Promoters Say The Well Is Dry

Germany’s biggest and recently renamed promoters’ association says it’s no use in the country’s royalty collection agency wanting more money because the well is running dry.

The Bundesverband der Veranstaltungswirtschaft, which recently switched its acronym from IDVK to BDV, was to meet GEMA representatives at the collection society’s Munich headquarters Oct. 7.

It will be the two sides’ third attempt to thrash out whether revenue streams from such things as sponsorship should also be liable to pay the tariff.

At the end of last year, they were forced into an uneasy compromise over the tariff being increased because the German arbitrary court threatened to hand the matter over to the High Court of Munich.

Had they failed to cut a deal before the arbitrary court’s deadline, both sides would have been plunged into a hugely expensive legal tangle with no guarantee of a favourable outcome.

GEMA dropped its bid to get the tariff hiked to 10 percent across the board, but the promoters still had to swallow new basic rates that are nearly double the 3.86 percent they were paying on larger shows and almost four times the 1.87 percent they were paying on smaller ones.

Discussions about the sponsorship money were put on the backburner, but the arbitrary court will expect the promoters and GEMA to reach a settlement on it by the end of the year.

At BDV’s annual meeting at Hamburg Empire Riverside Hotel Sept. 29, the 100 or so promoters present agreed they had to draw the line when it comes to GEMA’s efforts to get its hands on some of the sponsorship money.

“The problem is that most shows need some sort of sponsorship or they make no financial sense, but the questions will be how this is calculated,” BDV chief Jens Michow told Pollstar, when the earlier GEMA compromise was thrashed out. “If the sponsorship is in the form of 20 free radio slots, will GEMA want to add up the value of those slots and charge us on what they say we’ve saved?”

For the promoters, the reality is that GEMA isn’t likely to accept any deal that would see sponsorship remain exempt from the tariff. However, fighting with its toes to the line could mean the BDV would be forced to slug it out as far as the High Court.