Copyright and Performances (Application to Other Countries) (Amendment) (No. 2) Order 2024

The Government further justifies their position by arguing that expanding performers’ rights would negatively impact the UK music sector. The Government’s decision to not expand performers’ eligibility is partly based on the argument that UK affiliates of overseas record labels retain a significant proportion of the revenues attributable to foreign rights holders. Specifically, the British Phonographic Industry, BPI, claimed that UK labels retain 30% of the revenues collected in the UK on behalf of foreign affiliates, and that any reduction in revenues for US record labels would mean less money for the UK music sector.

Little evidence for this claim has been made and the Musicians’ Union disputes it, arguing that this paints an “exaggerated, bleak picture”, that the UK and US operations remain financially separate in practice, and that it cannot find any workings in the BPI’s redacted submission to the consultation. This suggests that the Government’s financial justification is based on flawed information, not solid evidence. Smaller independent record companies have, by contrast, expressed that the current situation is unfair and supported option 1, which would expand performers’ eligibility for remuneration.

The Government also claim that denying US performers public performance rights is intended to encourage the US to adopt material reciprocity. However, the revised economic impact assessment acknowledges that this is unlikely to influence US policy. In the view of Equity, a more effective strategy would be to offer US performers rights for a limited term, such as 10 years, and then use that as leverage to negotiate material reciprocity with the US Government. This approach would provide US performers with fair compensation while creating an incentive for the US to reciprocate. The current strategy effectively withholds remuneration from performers as a negotiating tactic, while a more effective strategy will still guarantee that performers get paid for their work.

The Government’s policy is intended to ensure that UK law meets its international obligations under the Rome convention and the WIPO Performances and Phonograms Treaty. However, the implementation of option 0A undermines the spirit of these treaties by creating a system of unequal treatment for performers based on their nationality. Equity believes that all foreign performers in countries that qualify for public protection rights should benefit from the same level of protection. It considers the current approach to be unethical, and we agree. As a matter of principle, performers should be remunerated for their work. This option leaves some performers benefiting from national treatment, ignoring lack of material reciprocity, while US performers are denied remuneration on the basis of material reciprocity.

The Government have stated that the current statutory instrument corresponds closely to option 0, which was the status quo option. However, the Intellectual Property Office itself stated in its revised impact assessment that

“Parliament has passed the CPTPP Act. The CPTPP Act contains measures that will, when it comes into force (expected in December 2024), expand eligibility for performers’ rights generally, in a way that approximates the effects of Option 1. Doing nothing therefore now means allowing the law to change in a way similar to that set out in Option 1, rather than maintaining the effect of existing law”.

Therefore, the Government’s claim that they are maintaining the status quo is actually incorrect, because the status quo is already changing due to the CPTPP Act, which has now come into effect. The Government are claiming to maintain the status quo, but that status quo is already changing due to that legislation.

Equity, SAG-AFTRA, the Musicians’ Union and PPL have all raised concerns regarding the Government’s proposed course of action. This statutory instrument should be withdrawn due to a flawed consultation, the unfair treatment of US performers, the disputed financial claims, its ineffective approach to achieving material reciprocity, the ethical concerns and the contradictions with existing legislation. The Government should reconsider their approach, consult on both option 0A and option 1 and implement a system that provides equitable remuneration for all performers. I beg to move.

This order creates a two-tier system whereby some foreign performers continue receiving payments while others do not, even if their work is commercially successful in the United Kingdom. It undermines the principle that all artists should be fairly compensated for their work, regardless of nationality. As an addendum, if fewer performers are entitled to equitable remuneration, UK collecting societies may collect less overall, which might impact their ability to distribute royalties efficiently and affect the broader musical and entertainment industries.

In conclusion, this order undermines fair pay for performers and risks harming UK artists abroad, and it could even lead to unnecessary international disputes. So, instead of limiting performers’ rights, the UK should lead by example and ensure that all performers are treated equitably, regardless of their nationality.

The approach implemented by this order largely preserves the effect of the former law—option 0 in the consultation—except for some limited changes. This means that more foreign performers qualify for the right than previously—a change that was made to allow the UK to fulfil its international commitments. The noble Lord, Lord Clement-Jones, asked whether we were in effect maintaining the status quo. This SI largely preserves the effect of the law as it formerly applied at the point that the SI took effect. The SI took effect simultaneously with the changes in the CPTPP Act. The consultation also explicitly noted that the effects of that Act may be modified by this SI.

To come back to the main point, under the law as amended by this order, some foreign performers enjoy these public performance rights only where and to the extent that British performers enjoy equivalent protection under the other country’s law. The Government adopted this approach in light of the evidence submitted at consultation, which indicated that the other options under consideration would have meant substantial costs and disruption to the UK’s creative industries. I am not sure that noble Lords gave enough credence to that argument. For example, granting rights to all foreign performers, regardless of whether the other country provides reciprocal protection to British performers, would mean additional costs to the UK recorded music sector—estimated at £5.9 million per year—with no benefit to UK creators, copyright owners or the public. This could undermine continued investment in new British artists and their music.

I have listened to what people say and I appreciate that some consider it unfair to provide different treatment to performers based on their nationality. However, as I have said, this is a reflection of the treatment accorded to British performers by other countries. If they were to change their law and provide equivalent protection to British performers, then performers from these countries would automatically enjoy these rights under UK law. The Government would be pleased to see all other countries adopt similarly high standards of protection to the UK in this area, to the mutual benefit of performers from the UK and other countries. We continue to pursue that objective where and when we can. I assure noble Lords that these measures were not targeted at the US or any other country in particular. The SI implements the general principles that deliver the best outcome for the UK’s creative industries. I hope we can agree that that ought to be a priority.

I thank all noble Lords who have taken part in this debate. I hope they are in some ways reassured about the Government’s process in making this order, which we believe delivers the best outcome for the UK’s creative industries. I hope noble Lords will reflect on it and that the noble Lord, Lord Clement-Jones, will be content to withdraw his Motion.

I very much hope that the Government will at least take back from this regret Motion that in producing an option at the last minute, however creative it may be—I would not deny that creativity is a useful thing to have in the department—you can be slightly overly creative if you are not consulting on a particular option. I thought it was a neat piece of speechwriting but not necessarily to be desired. It is the kind of thing that would go to judicial review if a commercial organisation was involved in this SI. If this was BT, or another major telecom company, disputing an SI in which an option had not been consulted on, they would take this kind of thing to court. As it happens, this is about artists and unions, so they are not going to do that; they are going to go through the political process. I welcome that, but it nevertheless shows the fragility of the decision that has been taken in this case. I beg leave to withdraw the Motion.