Specimen Publishing Agreement
Published: 08 October 2020 | 11:46 AM
Updated: 20 January 2021 | 12:47 PM
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A Publishing or Song-writing Agreement is the document by which a songwriter assigns the copyright in his compositions to a music publisher in exchange for royalties and, in appropriate cases, an advance against those royalties.
Traditionally music publishers acted in much the same way as book publishers and printed and sold copies of the compositions in the form of sheet music. However with the coming of the gramophone record and the advent of mechanical royalties (the licence fee charged by the owner of the copyright in a musical composition for the right to reproduce that composition “mechanically” on a record) arranging for compositions to be recorded and collecting these monies became the main work of most publishers. Then came film and television and publishers began to seek new sources of income from allowing the compositions, which they controlled to be used in synchronisation with moving images (“syncs”) for inclusion in film and television programmes and in advertising. Now the publisher will administer, through MCPS-PRS Alliance the “making available” right which deals with the use of compositions online.
Many argue that songwriters should be wary of signing deals with publishers who will do little more than act as banks – collecting money from collections societies, holding onto it for up to six months and then paying it over to the songwriter less their percentage. A good publisher will do far more than this and will actively “work” the compositions, which they publish in order to secure the recording of cover versions, synchronizations in film, TV, advertisements and computer games (to name but a few). They will also chase money that collection societies may have missed or mis-allocated and generally seek to speed up the “money-go-round” that is the modern music business. The other advantage that the songwriter gains is that in many instances the publishers will pay an advance which can help him or her to pay the rent and feed themselves whilst writing. Good publishers will also give advice and help to the songwriter, arrange co-writes where appropriate and, if they are performers as well as songwriters will often help to find and advise upon recording deals.
A brief explanation of the key clauses
Clause 2: Term
As with Recording Agreements, Publishing Agreements are usually structured as an initial period followed by a number of “option periods”. The options are always exercisable at the discretion of the publishing company. Each of the initial period and the option periods are usually referred to as “Contract Periods” and the Contract Periods together are referred to as “the Term”. Agreements are usually structured, as here, with the length of the each period being dependent upon delivery of a minimum commitment of compositions by the songwriter. It is important to ensure that, although the length of each Contract Period will depend upon the date of delivery of such minimum commitment that there is a longstop cut-off (clause 2.2), often 2 or 3 years, to prevent a Contract Period being endless if delivery does not take place for any reason.
In this Agreement the Minimum Commitment in each of the Contract Periods is defined (clause 1.8) as one Album wholly written by the Songwriter, which is released by a Major Record Company (as defined in clause 1.7). It is not always the case that the publisher will require the album to be released but publishers obviously prefer this stipulation as it increases their chances of having income to collect. If the songwriter writes with other people it will be inappropriate for the Minimum Commitment to be a “wholly” written Album and it should be a percentage of such Album (this may require further negotiations if it is likely that part of the relevant album will include compositions wholly written by third parties). In the event that the songwriter delivers less than the Minimum Commitment in a Contract Period there is often provision in the Agreement for advances to be reduced proportionately (there is very rarely provision for advances to be increased in the event that they deliver more).
Traditionally publishers will want as many option periods as they can get while it is in the songwriter’s interest to grant as few options as possible. This agreement provides for 3 option periods that would be considered fairly short for a major agreement with 4 or 5 option periods being more common.
Clause 3: Duration of Rights
Unlike recording agreements where record companies will almost invariably take an assignment of copyright in the recordings for the life of such copyright, many (but not all) publishers will only want an assignment, and thus the right to collect income and administer the rights, for a limited period, (the “Rights Period”, sometimes called the “retention period”). In this agreement this period has been set at ten years but this will obviously vary from case to case (the norm being anything between five and twenty five years after the end of the Term) and is really a matter for negotiation.
Clause 4: Engagement
This agreement provides for the songwriter to provide his or her exclusive services to the publishers, as a songwriter and composer and the copyright in all compositions written during the term of the agreement will belong to the publisher for the Rights Period. This obviously means that the songwriter cannot assign any compositions written during this period to anyone else.
Clause 5: Advances
As with Recording Agreements advances under Songwriting Agreements are non-returnable but are recoupable from publishing royalties. The amount of the advances has been left blank, as this will be subject to negotiation.
Advances for Option Periods are often based upon what is known as a “mini-max” formula where the actual advance payable is calculated as a percentage (usually between 66% and 75%) of royalties generated over the preceding year of the Agreement (or some other period of time) subject to agreed minimum and maximum (hence “mini-max”) payments set out in the Agreement.
Clause 6: Royalties
This clause deals with the royalties that will be paid by the publisher to the songwriter (or used to recoup a previously paid advance). The royalties are broken down into categories of income, the most important of which are set out below. The figures used in the Agreement are by way of illustration and are the level of royalties which a reasonably successful songwriter might hope to achieve after some negotiation. Some agreements contain provision for royalties to escalate as the Term goes on and options are exercised whilst others provide for escalations depending upon chart positions or sales.
i) Mechanical Royalties – these are the royalties paid by record companies for the right to reproduce compositions on records.
ii) Covers – these are royalties from recordings of cover versions of the compositions. The meaning of “cover” is dealt with in clause 1.6 and publishers traditionally demand that a reduced royalty be paid on such recordings to reflect their work in obtaining the cover for the songwriter. You will see that in the definition of what constitutes a “cover” (clause 1.6) it must be obtained by the publisher’s efforts. Publishers will often try to resist this and claim that any recording not by the songwriter should be considered a cover and qualify for a royalty break.
iii) Synchronisation Fees – i.e. synchronisation of the Composition with a film, TV advert, computer game etc. – sometimes a reduced royalty is paid to reflect the extra work by the publisher in negotiating and arranging the synchronisation deal.
iv) Performance Income – this is a very important source of income for songwriters (for many it can be the major source). In the UK performance income, which is the fee paid by the user to the copyright owner each time a composition is performed in public including on the radio or on television, is collected by the Performing Right Society. In other countries there are similar bodies that have reciprocal arrangements with PRS for collection of performance income. Both publishers and songwriters can join the PRS and receive periodic payments based on the usage of their compositions, which they have previously registered. Half of the performance income collected (after deduction of the society’s commissions) is paid directly to the songwriter (“the writer’s share”) and the publisher does not share in this income nor can it be used to recoup advances. The other half of the performance income called, predictably enough, the “publisher’s share” is paid to the publisher and this is now generally shared with the songwriter, in this Agreement the split is 50:50 (bringing the overall rate for performance income back to 75%/25% mechanical rate).
It is important to note that the royalties in this Agreement are expressed to be “at source”. This term is defined in clause 1.3 and means that where monies are collected for the publisher by licensees or affiliates, the songwriter’s royalty is based upon the sums received by those licensees or affiliates and not upon the sums received by the publisher, which may have had commission deducted. Not all publishers offer at source deals but where they do not songwriters should seek to limit the amount of deductions permitted and seek a correspondingly higher royalty rate.
Clause 7: Assignment of Rights
By signing the Publishing Agreement the songwriter agrees that the copyright in all of his or her compositions will belong to the publisher either for the life of copyright or, as in this case, the Rights Period (here the Term plus 10 years – Clause 1.11)
As owners of the copyright, the publisher will be entitled to exploit the compositions subject to any restrictions in the Publishing Agreement. By this clause those rights are assigned to the publisher; the clause also details the restrictions placed upon their exploitation of the copyrights.
Whilst many songwriters want (or need) the services and money offered by publishers many do not want to relinquish all control over their works. Conversely if the publisher is paying the songwriter an advance (and in some cases even if they aren’t) they want the freedom to be able to exploit the rights and make money out of them without too many restrictions. The restrictions and controls given to the songwriter in this Agreement are ones that someone signing to a major publisher might reasonably expect to get with a little negotiation. Essentially the more successful the songwriter the more “artistic” controls they are likely to be able to get from the publisher. It is also worth noting that if the songwriter feels strongly about certain things, the use of his or her compositions to advertise armaments, meat, tobacco or their use in pornographic or “X” rated films, this should be made plain to the publisher who will usually be co-operative, provided that the restrictions are not too many or too limiting.
Often in the assignment of rights will be wording which entitles the publisher to the rights in compositions which were written before the Term and which have not been previously assigned to another publisher. In addition they will also try to catch any rights which revert to the writer from old publishing agreements so if you have a big and valuable back catalogue which you expect to revert during the Term you need to be aware of this.
Clause 8: Writer’s Warranties
The warranties contained in this clause are fairly standard and essentially promise and warrant that the songwriter owns the rights that are being assigned and the compositions will be original and will not infringe third party rights and that songwriter will not compose for anyone else during the Term.
In addition, the songwriter warrants that if they have signed a recording agreement which states that mechanical licences in North America will be available on terms less than those provided by statute, they have disclosed this to the publisher (clause 8.6). This clause also provides that the publisher will accept limitations of such mechanical royalty in any future recording agreement. Over the past few years, publishers have become more reluctant to accept this blanket undertaking and require at least the opportunity to make representations to the record company at the time that the recording agreement is being negotiated. (In practice most are pragmatic about this although they are becoming less so).
Clause 11: Accounting
This clause deals with the publisher’s obligation to account to the songwriter. In this agreement accounts are to be prepared and delivered twice a year, which is usual but it is worth trying to get the publisher to account quarterly as this might aid cash flow.
Under English law artists would normally have six years in which to bring proceedings against the company for any discrepancies or inadequacies in the accounts. However publishers always try and limit the time in which any objection must be made to incorrect accounts, often to as little as one year. From the artist’s point of view this period should be as long as possible but it really should not be less than three years.
It is also important to ensure that the agreement contains provision for the songwriter to carry out an audit of the publisher’s books and for the publisher to pay the cost of such audit if a material underpayment is discovered.
Clause 12: Publisher’s Obligations
This clause is really self-explanatory but it is often very hard to get even the best of publishers to commit to these things in the Agreement. It is however worth trying as it gives the publisher something to think about.
Clause 13: Re-Assignment
This clause is important as it essentially provides that if the publisher does not do anything with the compositions the songwriter can have them back. The uses that the publisher must obtain are a bona-fide recording (it is worth pushing for release) by a recording artist or a synchronisation of the compositions. Some agreements also provide that acceptable uses for the purposes of clauses such as this one, would be a public performance or the compositions publication in sheet-music form. If a public performance is to be included, it must be on a proper radio or television station (not hospital radio) or in an auditorium or venue with a reasonable capacity before a fee-paying audience. Failure to insert these provisos would allow the performance of any composition by a busker to a cinema queue to count as exploitation. Be aware however that in some cases your own performance of your Composition in public may entitle the Publisher to retain it for the Rights Period even if there is no further or other exploitation.
Clause 14: Indemnity and Remedies
This clause is important and should be read carefully as the songwriter agrees to indemnify the publisher for any breach of the Agreement by the songwriter. This clause also contains provision for the songwriter to terminate the Agreement in the event of liquidation of the publisher and for compositions to revert to the songwriter in that event.