By Marine Fidanyan

Collective Management Organizations of Authors' Economic Rights

1.Introduction

All the phases of the development of humankind have been accompanied by and reached nowadays with help of different types of art: rock carvings, oral folklore, songs, dances, ceramics.

Art, culture, nation, state through direct interconnection of these conceptions characterized and differentiated skills and specifics of each nation, which in its turn serves as a safe guarantee for ensuring sustainable continuity of the existence of a given country and for securing a place among the developed countries on the international arena. Therefore, the role and significance of State interest toward Art in particular country, development and initiation of legislative amendments, improvement of mechanisms of Copyright protection is indisputable.

The goal of this paper is to disclose the grounds of authors' moral and economic rights protection, who are working in the field of literature, science and art, to present functions of organizations collectively managing author's economic rights and basics for implementation of the relevant process.

2.The Government Program for 2008 and Intellectual Property

Generally, the field of Intellectual Property is regulated by legislation of the Republic of Armenia (RA) and by ratified international conventions. Intellectual Property is divided into two major branches:

• industrial property,
• copyright and related rights.

The Government Program for 2008 enclose this important field, and in section "Major Directions of the Government", clause 4.3.6 "Copyright and Property Rights" it touches on the issues of the field. The following observations can be made regarding this clause:

First

Under the title "Copyright and Property Rights" both author's economic rights and property rights are represented together. It is worth to clarify that in Armenia "property" word is used to specify two types of rights, that is

• real estate / property rights;
• author's economic rights / the author's right to receive remuneration from the user for any usage of author's work/.

Thus, it is important to differentiate the issues of these two fields from the beginning, since the mentioned two types of rights require different approaches and essentially different from each other.

Second

First and second sub-clauses of the Clause 4.3.6 refers to the "registration of appropriate rights of inventors and organizations", since inventions and, consequently, the rights of inventors are protected not by the Copyright legislation (which is implied from the title), but by the Industrial property's legislation, that is by law and other sublegislative acts regulating appropriate registration of patent and protection thereof.

Third

Government Program's clause 4.3.6, the 6th sub-clause presents the major issues regarding the management of a unified cadastre of real estate and enactment of property rights. Taking this into account, it is important to note that the Copyright is aimed to the protection of author's exclusive rights over own works created in the result of intellectual activity, which has no common with the property rights, i.e. to the registration, possession and exploitation of real estate.

Therefore, it is recommended to

• differentiate from the beginning the major issues regarding the rights of authors and inventors from other field's issues;
• present these issues under a separate title, namely "Intellectual Property Rights";
• then refer to issues regarding both Industrial property and Copyright and related rights.

3. Legislation

Copyright is regulated by RA Law on Copyright and Related Rights, adopted 15 June, 2006 (hereinafter "Copyright Law"). On the one hand it prescribes author's right to receive remuneration for usage of the work, that is regulates legal relationships between authors and other individuals, and, by considering interests of all members of the society, it defines the cases [] of free use, that is usage of the work without author's permission and without paying the relevant remuneration on the other.

Every day many songs are transmitted by radio and TV, performed in cafes and restaurants, performances are presented at theaters, numerous concerts and festivals are organized, where works of different styles are performed. Copyright Law, Article 13, point 3 stipulates that in case of any usage [] of the song or other "work" of art the author shall receive remuneration. This remuneration is the "salary" of the author, since the "activity" of creative individual differs from the everyday common work of ordinary employees.

On its appearance the legislator regulates legal relationships of this field by stipulating appropriate provisions. However, the authors still face numerous obstacles in exercising of their own rights.

Author - User legal relationships are implemented in two modes:

1. individual (contractual);
2. collectively.

In order to get permission to use the work, and consequently, to pay for it, a contract shall be signed between the Author and the User. This is the individual type of exercising the authors' economic rights. In cases when the control is impossible and/or is difficult, authors' economic rights are exercised only through collective management organizations.

4. Collective Management Organizations of Authors' Economic Rights

The fact of great worth is that RA Government Program for 2008, Clause 4.3.6 "Copyright and Property Rights", point 4 states the importance of the principles of the collective management of authors' economic rights organizations. Therefore, it is important to organize and initiate steps towards solving this important issue.

Such organizations are created by the authors, and are considered as intermediary body between authors and users. The main functions of organization are

• signing of contracts;
• collecting of relevant remuneration;
• distribution of collected remuneration.

The major principles of working are

• transparency;
• impartiality.

Organizations also sign mutual agreements with similar organizations establishing in foreign countries, provide national protection to foreign authors on their territory, based on responsibilities taken by own country through ratifying international conventions. Articles 63 and 64 of the RA Copyright Law regulate the activities of these organizations and define their functions.

Still there is only one such organization operating in Armenia, that is "Armauthor", which collects and distributes to its members the amount for monthly usage of works.

Thus, it is very important to initiate an immediate and consistent campaign to raise public awareness, because any violation of Copyright is legally prosecuted, and unawareness does not exempt infringers from charge.

5.Supervision

Armenia de facto has a law which regulates the above-mentioned legal relationships. However, in reality Copyright and related rights are infringed everywhere. What is the reason?

Recently, the consistent complaints voiced by the authors refer to both cases of illegal use of their works, and, consequently, to received little amounts of remuneration. Possibly, the above-mentioned organization faces different problems in organizing the whole process alone.

According to Article 63.1 of the Copyright Law, no more than one organization can be established for the same category of rights. Thus, the legislator stipulates adequate provisions on regulating the activities of collective management organizations of economic rights, however, fails to conduct the supervision over organizations which factually are in a monopole position.

Study of international experience shows that there are different models of supervising such organizations. Each model has its own characteristics according to its country's legislations. Supervising is conducted either through the competition legislation, or by a special permanent Supervisory body. This is a separate topic for other study, which is also necessary to conduct with the aim to find more applicable model for Armenia.

Supervision of such organizations will allow both users and authors to feel equally protected, and the outcomes will be rather tangible. Thus,

• users will cease to be objects of lawless and "selective" collection of money, i.e. all users will pay the same amount for the usage of work;
• authors will receive appropriate remuneration.

6. Possible abuses

Following abuses and violations might be observed in activities of "unsupervised" collective management organizations (hereinafter "Organization"), particularly

• whether such Organization receives an exact list of used works per month from the user
• whether the Organization carry out radio and television monitoring with the purpose to compare and check the list provided by the consumer
• whether the Organization concludes contracts with all users on equal terms
• whether remuneration is collected from all concerts organized on the territory of the Republic of Armenia
• whether the administration of concert hall is responsible to inform the organizer of the concert on remuneration issue
• whether the administration of concert hall provide relevant information about the organizer to the Organization
• whether the Organization collects money for only one category of rights
• whether contracts' fixed amounts signed with various users contradict with the minimum remuneration rates defined by the RA Government Decision, that is not less than the defined rates
• whether presented amount from ticket sales is accurate, since the Organization cannot compare presented amount with taxation authorities
• whether the Organization is entitled to collect money for non-member authors
• whether the Organization have appropriate human resources to fulfil the appropriate process
• whether the Organization protects the rights of foreign authors in Armenia according to the provisions of the RA Copyright Law, which is very important in gaining reputation for protection of copyright in our country.

Thus, for protection of authors' rights it is necessary to propose legislative amendments and prepare appropriate mechanisms for effective management of authors' economic rights.

7.One organization, or...?

7.1. Legislator stipulates that administration of different categories of rights shall be exercised by different organizations (RA Law on Copyright, Article 63.1). However, the categories of rights mentioned in different articles vary, thus causing confusion.

In general, there are rights, which shall be exercised only by mentioned organizations.

Those are

• Reprographic reproduction
• Lending
• Renting
• Reproduction for Private Purposes

Reproduction for Private Purposes is subject to collective management of rights, which is not mentioned in Copyright Law at all, and the other types of rights mentioned above are not clarified.

In case of Private reproduction remuneration is paid by the organization, which imports adequate equipment to Armenia (equipment, by means of which the copy of the original work can be made). Thus, legislative amendments are required.

7.2. Whether the existence of so many organizations in a country like Armenia with small population and, consequently, small number of authors is justified?

For instance, many singers in our country are also the authors of their songs. Thus, it can be inferred that the same author should be a member of at least two different organizations, which will complicate documentation matters and, in the result of which both authors and users will become involved in bureaucratic troubles.

On the international arena there are different types of organizations with the centralized implementation of different types of rights. This is a topic of separate study, which is also important in considering issues of centralized or separate exercising of authors' rights in our country.

8.Objectives

The necessity of state's attention and immediate interference in this issue is justified by a number of factors:

• implementation of authors' rights to receive prescribed by law fair remuneration, which will later contribute to ensuring pensions;
• protection of both authors and users rights;
• development of mutual confidence between authors and users;
• fulfillment of international obligations of the Republic of Armenia;
• increase of tax payment;
• increase of budget;
• reduction of piracy and, consequently, its partial elimination;
• prevention of creative people's migration;
• Increase of level of trust within international society towards the Armenia.

9.Recommendations

The feeling of being a full member of society is essential for any citizen and is conditioned by state's initiated sufficient steps directed to protection of rights. Therefore, to meet the objectives mentioned above, it is recommended to

• organize an awareness campaign;
• design a website "Copyright" with information on copyright issues in Armenia;
• create a working group to analyze and research issues mentioned above;
• initiate concrete steps towards formation of a separate state Supervisory Body;
• present legislative amendments and/or proposals;
• organize discussions, roundtables about the above-mentioned issues;
• promote the establishment of collective management organizations for other categories of rights prescribed by law.

10.Conclusion

To sum up, the protection of Intellectual Property, particularly Copyright protection, requires serious and immediate attention. It is necessary to initiate concrete steps in a short time in promotion of the process targeting this issue by involvement of a possibly large number of stakeholders.

The issues of Intellectual Property, in one way or another, are connected with almost all the major priorities defined in the Government Program, which implies that protection of authors' and other right holders' rights is essentially feasible.

Art people differ from the other members of the society in their temperament, mentality, lifestyle and sensitivity. They create national values, which are durable and are considered to be the guarantee of the sustainability of the nation and state. Therefore, the necessity of providing state's interest over authors' rights protection is conditioned and determined historically. Protection of copyright and appropriate administration of economic rights will be favorable not only to the reduction of poverty in the country, but also to the economic growth in general, which is conditioned with the raising of the role and significance of the collective management organizations of authors' economic rights.

By initiating different actions targeted to the improvement of the current situation and finding solutions to the mentioned issues, the RA Government will make a significant step towards developing a healthy society, improvement of the living standards, increase of trust towards the state, and growth of foreign investments in the country.

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