If you are a commercial radio station that authorized the Radio Music License Committee (RMLC) to represent you in negotiations and litigation against SESAC, then you need to act quickly to receive the full fruits of the RMLC’s labor. Unless you return an executed copy of the RMLC-SESAC radio license to SESAC by March 26, 2018 you will not be able to receive a retroactive refund of certain SESAC license fee overpayments thus far.
It hasn’t even been a year since an arbitration panel, empowered by a settlement agreement that ended litigation between the RMLC and SESAC, significantly lowered the rates paid by most commercial radio stations to perform musical works over the air and online. The panel’s ruling set a royalty rate of 0.2557% of net revenue for stations, with talk stations paying just 22.5% of that rate. These rates apply to the years 2016-2018 and can only be enjoyed by commercial radio stations that authorized the RMLC to represent them for those years.
But there is an important caveat to represented stations’ ability to benefit retroactively from the reduced rates that resulted from this arbitration. Stations must execute the RMLC-SESAC license and return it to SESAC no later than March 26, 2018 in order to receive a refund of certain overpayments made thus far. If they do not execute the license by that date, they will only be eligible to receive, at most, an operational credit for those overpayments. Under the license, stations must also submit an annual report of 2016 revenues within 30 days of executing the license and an annual report of 2017 revenues by April 1, 2018. The license and annual reports can be found on the SESAC website and must be submitted to SESAC via email at radiolicensingreports@sesac.com.
If you were asleep at the switch and would like to take advantage of the RMLC’s hard work in seeking lower SESAC fees going forward, all is not lost. You are still able to authorize the RMLC to represent you in future license periods, starting in 2019, if you act promptly.
As per the settlement agreement, the RMLC and SESAC must return to the negotiating table to set rates for represented stations for 2019-2022. If they do not reach an agreement by Dec. 31, 2018 it’s back to arbitration. This process continues for successive license terms through 2037.
Given that the rate that emerged from arbitration was significantly lower than the rate previously charged by SESAC to commercial radio stations, one can logically expect that, whether the RMLC and SESAC reach an agreement or whether they go to arbitration, the applicable rate for RMLC members is likely to be remain closer to the 2016-2018 RMLC-SESAC rate than the prior SESAC rate. It is therefore in the best interest of commercial radio stations to get in on this RMLC action.
If you have already authorized the RMLC to represent you regarding SESAC fees, you don’t need to do anything (other than avoid delinquent fee payments – more on that below). Your authorization carries forward into future license terms unless you tell the RMLC and SESAC otherwise.
If you did not already authorize the RMLC to represent you, you can still do so for future terms by completing this RMLC Authorization Form. Although the deadline for submitting this form is Sept. 30, 2018 the RMLC has requested that it be submitted no later than March 31 to give it sufficient processing time.
Regardless of whether you have previously authorized the RMLC to represent you or are doing so now, retaining that status requires you to avoid becoming seriously delinquent (i.e., by six months or more) in your payments to SESAC.
We have kept you up to date on all developments involving the dispute, litigation, negotiation and arbitration between the RMLC and SESAC for several years now. Please feel free to contact us if you need more information about these filing deadlines or anything else.