The great heavy tour of Def Leppard, Whitesnake and Europe beats the SGAE in the Supremo

2023-12-04 23:17:53

In 2013, the heavy bands Whitesnake, Def Leppard and Europe starred in a joint tour of Spain that still rings in the ears of the General Society of Authors and Editors (SGAE). The tour promoter refused to pay the 10% box office fee that the SGAE required at the time, and the Barcelona Court ruled in 2019 that 3% was already fine. The SGAE took the case to the Supreme Court, convinced that it would win to avoid that precedent. But the High Court has ruled that this 3% “does not constitute any arbitrariness.” The SGAE minimizes the importance of the ruling and limits it to that heavy tour, but the lawyer who won it warns of the gap it opens at a time of litigation between courts and the SGAE in the midst of the live music boom.

Justice condemns the Starlite festival in Marbella to pay 364,000 for non-payment of copyright

Rocknrock Productions brought together in 2013 what would have been a dream in the 80s: three of the best heavy bands toured San Sebastián, Barcelona, ​​Madrid and Santiago. The promoter was Pierre Sabbag, who for years brought the best heavy groups to Spain. According to this Time.news On the San Sebastián gig, Europe made “sparring with a bad sound.” Whitesnake did not deserve that “deficient and inappropriate sound” and Def Leppard did show “compact, professional and brilliant staging.”

What no one knew then is that, when it finished, a judicial fight that has lasted for a decade began. The SGAE, as it did then, demanded 10% of the box office from the promoter as copyright for public communication: 115,398.40 euros. He refused, the SGAE went to trial and won in the first instance.

But at that time, the National Markets and Competition Commission sanctioned the SGAE for abuse of a dominant position. The court ratified that sanction and forced him to lower that percentage to 8.5%. That gave Rocknrock Productions a bullet. In 2019, The Barcelona Court highlighted “the excessive nature of the general rates applied by SGAE, which are seen to be far above those applied in other States” and established that 3% of the box office as sufficient. That is the amount that, for example, is paid in the United Kingdom.

The SGAE went to the Supreme Court convinced that it would revoke that decision, a dangerous precedent for other promoters. But on November 7, the Supreme Court endorsed the decision: “The Court justifies why the rates applied to the license contracts agreed between SGAE and the defendant were null, as a consequence of the abuse of the dominant position with which it had been imposed. the 10% rate, which had motivated the CNMC sanction; and also justifies the criteria it follows to apply a rate that it considers equitable, 3%.”

The SGAE removes iron from the decision. According to a spokesperson, the entity’s legal services consider that “it is limited to a specific case from 2013.” And he adds: “The legislation changed, the rate dropped to 8.5% and now the SGAE agrees on it among the main actors (concert promoters and other people in the sector).”

However, the lawyer who won the case, Montserrat Pareja, highlights the importance of the ruling. “The ruling confirms that the rate was not equitable and that the modification to 8.5% is not equitable either and I believe it remains not equitable because of the criteria for determining equity. The SGAE continues to have the lead when setting the rate,” she explains.

The doubt lies in the scope of the sentence. Although the SGAE limits it to the 2013 tour, Pareja believes that it can open a waterway: “There is still a dominant position on the part of SGAE, which continues to set its fees at its discretion. It has lowered it to 8.5% but I still think that it is not equitable and the arguments given by the Court and the Supreme Court are applicable. Many promoters are trying to explore this avenue, but there was no jurisprudence. When this is confirmed, a gap may open.”

At a time when festivals are booming, disputes between the SGAE and the promoters are not uncommon. The SGAE, for example, has managed to win from the Starlite of Marbella the payment of 364,000 euros for copyright. In this case, as in the case of the heavy tour, the promoter alleged that the fee was unilateral and announced his intention to go to the Supreme Court.

The cake is succulent. SGAE income [PDF] concerts have skyrocketed after the pandemic: 28.4 million in 2022 (118% more than the previous year). In total, according to his memory [PDF], distributed 316.3 million, 27.4% more than the previous year. This has also increased conflicts with the promoters. In a very unequal sector, businessmen try to reduce copyright payments as much as possible and focus on caches that negotiate directly with the bands. The SGAE argues that its programs not only distribute rights among great creators but, among other things, help the most precarious. Last year, it allocated 649,852 euros to help 815 authors.

Pareja points out that conflicts often arise due to the charging system for live music: “No one disputes that copyright is sacred, but the SGAE charges 8.5% of the box office without taking into account whether it has had losses. or benefits. In these cases, the investment is brutal and the risk and risk is very high. The settings, the caches… are brutal. I have clients with losses who also have to pay 8.5% of the royalties. If anything, it should be about net profit.” And he adds a doubt: “If the British entity pays the authors 3%, I always wonder what happens to the remaining money.”