By Daniel Hunter

The Federation of Small Businesses (FSB) has criticised of the progress made by copyright collecting societies and wants to see a more transparent service for small firms wanting to play music.

Collecting societies protect the rights of intellectual property in industries such as music, the media and design but the FSB suggests many small businesses are confused by the way the rules and regulations work.

New research from the FSB found as many a quarter of its members with a relationship with a copyright collecting society (24%) had made a complaint of some sort. The findings also show the lack of progress towards achieving greater transparency and simplicity of charges over the past 12 months. Without such progress, trust amongst small businesses in the current system will be undermined.

The firms questioned also thought that copyright collecting societies had not improved their understanding of the needs of small businesses. However, small firms did acknowledge some improvement to joint working between PRS for Music and Phonographic Performance Ltd (PPL). Businesses also welcomed improvements to the accuracy of information used by collection societies.

Later this month collecting societies are expected to publish a response to an independent review of their codes of conduct as laid out by their self-regulatory body the British Copyright Council.

Previous FSB surveys have indicated most small businesses who have a relationship with collecting societies are licensees of both PRS and PPL. Two percent of FSB members have membership of other collecting societies, including of PRS, the Authors’ Licensing and Collecting Society (ALCS), the Design and Artists Copyright Society (DACS).

John Allan, National Chairman of Federation of Small Businesses, said:

“An unexpected demand for licence payments to allow you to play music in your business can be a very unpleasant shock to some small businesses, and the industry should be sensitive in how they approach the issue. For trust to be built, they need to make sure they are very clear on why a licence is needed and completely transparent on how charges are calculated.

“Although collecting societies have a strong code of conduct in place, we are not convinced they are making enough progress in meeting their own standards. This research should be seen as a warning sign that without faster change, small business will start seeking stronger regulation of the industry.”

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