GEMA Must Justify Fee Increase

A German court of arbitration has told GEMA – the copyright collection society – it needs to come up with a better reason for wanting to hike up its rates to 10 percent of the show gross.

The two major promoters’ associations, Der Verband Der Deutschen Konzertdirektionen (VDKD) and Der Bundesverband der Veranstaltungswirtschaft (IDKV), gave a further clue they may amalgamate by joining forces to fight against the increase.

The German Patent and Brand Office’s court of arbitration ruled May 19 that GEMA should deliver further arguments to back up the increase.

The old GEMA tariff, the equivalent of the U.K.’s PRS, ranged between 1.8 percent and 4.5 percent depending on show size and other circumstances including discounts for regular promoters and members of either of the two major promoters’ organisations.

Those discounts will disappear under the new system, which will also apply the new 10 percent rate to sponsorship money and any other revenue streams the show may have.

“What’s 2 or 3 percent off the show gross can be 20 percent off the bottom line,” said senior German promoter Marek Lieberberg, who said he has no idea how GEMA can justify increasing the charges.

The matter comes back to court June 30 but it’s unlikely there will be a conclusion before the end of the summer.