The Blue Highway Beacon: Vol II, NO. 8

The Blue Highway Beacon has taken a short break into the summer season, as Blue

Highway and Blue Highway Global add new capabilities and new faces, with debuts of

expanded offerings and service areas set to commence as soon as the summer holidays

wrap up. One of the most important rollouts set for Fall of 2025 will be the expansion of our

core Creators’ Rights function, as we take up new themes, vital new areas of emphasis and

activism, and add a range of new partners and collaborators to our globally focused

campaign efforts. But there’s always just the right moment to drop a hint or two as to what’s

coming next, and here, Blue Highway’s own EVP Amanda Harcourt shines the most

comprehensive light yet on live performance royalty issues. At the outset, this is a

comprehensive read, but it covers EVERYTHING you’ll need to know about doings in the UK

and the EU (with a similar treatment of the US to follow).

Enjoy the read, and look to ahead, with us, to all that the Fall will bring. Lastly, as ever, we’re

just a call or email away from being of immediate assistance to you.

– Ian Christopher McCaleb, Founder / Principal, August ‘25

Why Aren’t ALL Songwriters Being Paid for their Songs in Live Concerts?

Part One (of Two): The Situation in the UK and Europe

By Amanda Harcourt, Executive Vice President for Intellectual Property Law and

the Entertainment Sectors, Blue Highway Advisory

The Problem:

After the digital revolution slashed music creators' revenues, and more recently Covid

interrupted their attempts to make money via live performance, the financial position of the

music creator is not a happy one.

Music creators’ revenues have shrunk markedly, unlike the recovery at record labels, music

publishers, music streamers and large promoters - companies all reporting a healthy

industry, as well as high-value rewards for senior executives. (Digital Music News 2024, Digital Music News 2023, MusicTech 2024)

As singer/songwriters are also faced with incomes threatened anew by the unremunerated copying of their works in unlicensed training of AI by digital behemoths, how are they to make up the difference?

One post-Covid answer might be: They go on the road.

An artiste’s relationship with their audience is the one that matters most. Ticket prices and

merchandise sales pay for touring costs (just about), the fee for the artists actually turning

up, and the licence fee charged for the performance of the songs in the set list, whether they are singing their own songs or performing those by songwriter colleagues.

Reportedly, the UK 2023 live sector has an economic impact of over £6 billion. So why then do songwriters report having so many problems being paid their royalties when their rights are performed live?

It seems writers of the songs in over 70,000 live gigs in the last three years are yet to be paid!

So, first, a brief music rights management tutorial for the uninitiated. If you know this, feel free to skip this next bit.

Music Licensing Background:

Copyright is not a solid thing, but a bundle of rights which are teased apart and licensed separately – the more strands, the greater the opportunity for licensing income. However, when a music writer signs an agreement so a publisher can manage their copyrights, not all the strands are assigned to the publisher’s ownership. A publisher has carriage of licensing, tracking, and accounting in relation to the works for such uses as in film, TV, games or ads and the copying of works in the pressing of CDs, for example.

Clearly, it would be unworkable for, say, Jazz Radio, in Lyon, France to secure consent to broadcast every work by every writer in the world for the entire week’s music output. So, by longstanding convention, a music writer’s licensing and royalty collection for other rights in the copyright bundle are dealt with differently. These rights are managed in bulk by collective management organisations (or CMOs) across the world.

Some CMOs collectively manage some aspects of the licences for copying as well. In the United Kingdom, the collective for reproduction or copying is the Mechanical Copyright Protections Society (MCPS). The CMO for communication to the public is done by a monopoly, the Performing Right Society (PRS).

A writer generally joins the CMO established in their home territory. By assignment, the writer grants the CMO the ability to license, collect revenue and pay the writer’s royalties from the strand of communication to the public, aka broadcast and public performance. As publishers have a right by contract to a share of all income, publishers need CMO membership as well. Both writers and publishers are represented on the UK and European CMO Boards.

The so-called “blanket licensing” revenue collected from broadcast and public performance, after usage analysis and allocation, is paid by the CMO in 50/50 shares, directly to both writer and publisher (or owner). The publisher then pays the writer a top-up of any monies greater than the 50% share as agreed in the publishing agreement.

Each CMO has reciprocal agreements with their equivalents overseas to mutually authorise the administration of each’s works in the other’s territory. Every CMO must treat the members of other CMO partners equally, giving them the same entitlements as those enjoyed by their own direct members. It is axiomatic, then, that each member within a CMO be given equal treatment… but more of that just a bit later.

Under these reciprocal agreements, where monies are collected in countries outside the country where a writer has their direct membership, the route of the 50/50 split is managed slightly differently. The publisher’s half is paid by the foreign CMO to the publisher’s local office, for forwarding internally to the country that is obliged by contract to account to the writer concerned. The other 50% - the writer’s share - is sent back to the CMO in the country where the writer has their direct membership.

This income route for foreign monies is a critical fact to bear in mind, as the vast majority of foreign income forming the PRS turnover is writers’ money!

There is, worryingly for the august UK society, currently a class action being considered by the UK Competition Appeal Tribunal that emanates from PRS writers! The potential suit relates to the disproportionate share of monies paid to publisher members where PRS has been unable to directly attribute the royalties to a particular work or writer. This is discussed in more detail below, but discussion of the actual class action is for another day.

By this international network and each CMO’s operating principles, any would-be music user can secure a licence for the entire world’s catalogue of music from the CMO where that music user is based. Thanks to the intervention of the European Commission some years ago, digital dissemination licensing is managed in a slightly different manner, but here we are concerned only with managing royalties from live performances.

Live Performance Royalties: The Plumbing

The live performance of music is a communication to the public. Touring should be a lifeline. In the words of one legendary musician and songwriter, “Income from the PRS for my songs used to be about 80% of my income; now I am lucky if it is 5%.”

For each live show, a tariff is calculated as a percentage value of income from ticket sales. In some countries, sponsorship revenue is taken into account. UK live tariffs vary between 2.5% and 4.2%. The tariff is deducted from the show’s income and paid to the CMO by the venue (even if the venue is not the legal user of the relevant rights), or by the festival. In the case of smaller UK venues, a flat fee tariff is imposed. Tariffs across Europe can be as little as 2% or as much as 11% depending upon the country in which the performance takes place.

Promoters, band managers or venues submit the set list from the live performances and this information is used to allocate the tariff value to those writers and publishers whose works have been performed.

Or so you would think.

This live analysis is generally acknowledged as being a costly operation to administer – 23% of live revenues at PRS. Local US live performance administration costs are lower, at 10-to-15%.

In Part Two of this series, which will focus on a study of US live performance revenues, we will explore why this is the case in that market.

Where a concert takes place abroad, the foreign CMO can be charging administration rates of as much as 30%. The half share remitted from abroad to the PRS will then suffer an additional deduction on top of what the foreign CMO has charged. These additional percentages can be as much as 4% to 8%. And remember: It is only the writer’s 50% of the monies that is being remitted to the UK, and is thereby suffering this double deduction.

Below, we will see that many tens of thousands of concerts remain unanalysed and the royalties unallocated. But, given the high administration costs (as much as 35%) being charged upon writers, one can see why writer members might be tempted to explore more valuable and more efficient options?

Live Performance Royalties: Historical Challenges to the System

It is worth noting that while a writer can audit their music publisher, no right of audit exists for any member in relation to the activities of their CMO. There are, however, legal rules covering the operation of collective management bodies which address, amongst other obligations, timing of accounting and transparency requirements in relation to their conduct. These are a result of four key events: two European Commission decisions about a German CMO; a high-profile investigation led by the Irish band U2; a competition enquiry into PRS; and most recently -- an EU Directive governing collective management organisations which is also incorporated into English law.

In the 1970s, the German CMO, GEMA twice found itself at the European Commission over its membership requirements and certain licensing practices.

([Re GEMA (No.1) (No 71/224) O.J. 1971, L134/15; 1971 C.M.L.R D35 and (No 2) Re: GEMA (No.72/268) O.J. 1972, L166/22; [1972] C.M.L.R D115; [1972] FSR 553])

One licensing practice that was criticised by the Commission was GEMA’s charging licence fees for works they did not control (some being in the public domain and therefore copyright free, for example). Part of the decision was that GEMA needed to improve operational flexibility and should allow members, on notice, to withdraw any of 12 identified strands (utilisation categories) in the bundle of rights assigned to a CMO. These entitlements applied, legally, to CMOs in all the EU Member States, including the UK on its membership in 1973.

In the early 1990s, Irish writer/performers U2, then writer members of PRS in the UK, commissioned an enquiry into their live performance royalties payable from their most recent tour. And here the author must declare an interest, having led the conduct of the enquiry on the band’s behalf. Over a period of nearly two years, the enquiry discovered the band’s live royalties were taking years to arrive back in the UK, if at all.

And the problems didn’t end there. In fact, the analysis of song set lists was patchy (to be polite); monies were, as now, suffering double administration deductions (the PRS’ and that of the CMO in the country of the performance); and many promoters were being given bulk discounts on tariffs by foreign CMOs (effectively, kickbacks), thereby devaluing writers’ copyrights. This is a practice that is arguably unlawful, yet continues to this day.

In addition it was found that many foreign CMOs were deducting two other “slices” from the revenue: as much as 10% to fund local cultural activities and, in some instances, what were known as “social deductions.” These latter deductions appeared largely to fund pension payments for some foreign writers and, incredibly, for executives at local publishing companies!

U2 argued that the PRS’ own Memorandum and Articles of Association permitted the withdrawal of certain rights, an argument supported by the categories enumerated in the GEMA cases. The PRS would “decline to exercise” the right in question. The band went on to issue proceedings against the PRS which were settled in 1994. Bono, Edge, Adam Clayton and Larry Mullen ultimately resigned from PRS to join IMRO, the recently established Eire CMO.

The U2 enquiry did not go entirely unnoticed.

On 30th November 1994, Sir Bryan Carsberg, the Director General of the UK Office of Fair Trading, referred the PRS for examination by the Monopolies and Mergers Commission, stating concerns that the PRS “may not [have been] operating in a fully efficient manner.” The Director General flagged concerns over distribution policies, high administration costs, inadequate representation for writers to effectively pursue their interests, the nature of the assignment and restrictions upon members who wished to leave.

Again, this author must declare an interest, as I was then serving as the CEO of the UK’s largest trade association for composers, authors and songwriters – now the Ivors Academy. I was expressly mandated by the membership to prepare the submissions for my Board’s approval, and the Academy delivered two very effective submissions to the MMC enquiry on behalf of what, we were informed by PRS, constituted over 70% of total PRS writers’ income.

In January 1996, PRS established a new Live Concert Service mere moments before the February publication by the Monopolies Commission of its 44 recommendations as to how PRS might buck up its ideas. Recommendation 2.112. stated “We therefore believe that a preferable recommendation is for the PRS to allow its members greater freedom to choose which rights to self-administer.”

PRS Live Concert Service

The PRS currently operates different licensing systems for different live concerts, one where the tariff (or licence fee) is a fixed rate operating at small and medium venues and festivals which PRS will subject to a 23% administration fee. There is a second system for performances taking place in venues of 5,000 or more persons where at least 60% of the songs are those written by the headliner, the so-called Major Live Concert Service (MLCS).

While PRS admit that costs of administering UK live performance rights come in at around 23%, in the case of the MLCS, administration costs are capped at £125 per set list (or £250 for one headliner and one support act). PRS state in one of their documents "For simplicity of presentation, we are treating the PRS £125 deduction as being 0.2% based on an average MLCS Event generating £62,500 in royalties." Effectively the more successful you are as a songwriter, the less the PRS charges to administer your royalties! Equal treatment?

So, let’s conduct a rough comparison of administration costs borne by members where, one might assume, all should be treated equally – particularly as overseas societies oblige the PRS to deliver equal treatment to their members.

1. Where we have a mid-level and singer/songwriters in the early stages of their careers, the administration rate they are paying is 23%. So, where ticket prices are £30.00, and the venue capacity is, say, 520, this will produce gross income of £15,600.00, with a net amount after 20% VAT (sales tax) of £13,000.00. The venue will be charged 4.2% tariff rate by PRS, which delivers a £546.00 licence fee. After administration costs of £125.58 (23%), a net tariff value of £420.42 results for the writers and publishers to share.

   
   

2. Under the MLCS, where a venue has capacity of 80,000 paying on average £150 per ticket, this will produce gross ticket sales value of £12m. with a net amount after 20% VAT of £10m. The tariff of 4.2% will produce a license fee of £420,000. If there is a support act, the costs of administration will be a maximum of £250.00 (or 0.06%). If there is no support act £125 will be deducted (0.03%).

If you have a gross of £15,600, the writers will pay PRS £125.58 (23%), but if you have a gross of £12million, you will only pay PRS £125.00 (0.03%) i.e. less in both proportional terms, but also in marginally actual terms. So, it seems that for singer/songwriters at PRS, the rich get richer, and the poor stay poor.

The MLCS bespoke system for the more successful members would seem to be a vast improvement, and some report that it is. But what of those songwriters that aren’t eligible for the MLCS?

Under the government Regulations, undistributed or unallocated monies are absorbed back into the PRS “pot” of unidentified royalties after three years. These absorbed sums are colloquially known as the "black box", the value of which is well-nigh impossible to determine. But it is worth looking at the current state of play (no pun intended) when it comes to live royalties based on PRS’ own published figures. Under transparency policies, the PRS publishes the list of the concerts, with artiste names, dates and venues, where the society has yet to distribute royalties from the licence fees.

These figures aren’t just a shock. They are an embarrassment.

The recently published 2022-2024 figures show that 74,494 live events remain unanalysed and the writers unpaid! The previous year the number of such events was a little over 50,000; so, in the last 12 months the situation has worsened by more than 50%.

It is also worth noting that owing to the “three years and then into the black box rule,” PRS reports that 2021 monies have been removed from the figures (i.e. subsumed into general unidentifiable funds – the black box). The tariff revenues from the 74,494 listed gigs in 2022, 2023 and 2024 are, PRS reports, “being actively researched” with the exception of 2022 – the year for which one might assume those gig revenues are poised to topple over into the black box.

This may be a result of artistes or their managers (or publishers) failing to submit setlists, but one would expect the PRS to be active in reminding their members of this requirement and proactively contacting the relevant parties to request the information so they can distribute the royalties to the correct rightsholders. It is in everybody’s interests that the Society run outreach to fulfil PRS’ legal obligations to members.

There is a second option for the singer/songwriters who are performing. In line with the GEMA categories and the UK competition authorities: Recommendation 2.112 stated, “We therefore believe that a preferable recommendation is for the PRS to allow its members greater freedom to choose which rights to self-administer.” This is reflected in the PRS’ own Articles and internal Rules.

Direct Licensing: Lawful Withdrawal of the Live Performance Right

By relying upon The Collective Management of Copyright (EU Directive) Regulations 2016 and PRS’ own Memorandum and Articles of Association, a PRS member can give written notice of their decision to withdraw or terminate from PRS certain of the rights assigned. This, in the case of live performance, then enables the member to issue a licence to the concert promoter or festival regarding the songs performed, and invoice and collect the licence fees from the promoter, analyse the royalties and pay the writers and publishers concerned in the percentages prevailing in the publishing agreement.

A UK-based organisation, PACE Rights Management LLP has been operating to assist writers and publishers to directly license their rights with some success. But problems with effective communications with PRS have led to legal proceedings being issued against PRS by PACE, and by nine PRS writer members who have been obstructed by PRS from obtaining their royalties via direct licensing when they perform their works live. This refusal is arguably in breach of the national Regulations, the PRS’ own Rules and Articles of Association and British competition law itself, all causing loss.

At issue are denials of withdrawal and conditions attached that are alleged to be unfair, anti-competitive, lacking in even-handedness and in breach of the CMO’s own internal governance principles:

• An alleged failure to give 20 days’ notice. This is a PRS requirement notwithstanding that the CMO is obliged to only make conditions that are “objectively necessary” (and given the PRS’ data on undistributed live royalties this makes 20 days seem somewhat arbitrary).

• The charging of a fee of £20 + VAT (£24.00) per work subject to the Notice of Withdrawal. Objectively necessary?

• Prior to December 2022, the requirement that writers sign an indemnity against claims from third parties brought as a result of the withdrawal. This was seemingly a blanket indemnity in respect of all members withdrawing their live rights.

• An Additional Agreement which provides no further rights or remedies to PRS, but requires the Member to seek guidance from their legal advisors prior to signing it (with the additional cost and delay such causes). Again, is that in the best interests of the members and objectively necessary?

To remind us of the competition rules applicable to UK monopolies, we turn to s 18 (2) of the Competition Act 1998. Abuse of a dominant position in the market occurs where a monopoly (in this case PRS):

“(a) directly or indirectly impos[es] unfair purchase or selling prices or other unfair trading conditions. (b) ……… (c) apply[s] dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage. (d) mak[es] the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of the contracts.”

This is a cause for concern given that at the monopoly that is PRS:

• There are different proportional administration fees charged to different members and rightsholders - s 18 (2) (a).

• There are different proportional administration fees charged to different members and rightsholders, to the benefit of the PRS wealthier members - s 18 (2) (c).

• Members wishing to withdraw their rights are being charged a fee of £20 +VAT per work when trying to exercise their right to withdraw – (c ) and (d).

• The historic indemnity arguably falls foul of s 18 (2) (d).

• It is difficult to justify objectively the notice period given the delays in licensing, tariff collection and, more importantly, the analysis and distribution of live royalties – viz the Regulations and the 70,000+ gigs awaiting analysis.

• All members are not being treated equally.

LEFT Principles

What is truly saddening is that a century old organisation, a not-for-profit set up to protect songwriters and composers, should be facing legal action - two in fact, given the class action application being made in relation to the broader allocation of black box royalties. Both have been brought by the creators themselves.

In 1947, Winston Churchill, indicating the uncertainty of the epigram’s origin, noted that “it has been said that democracy is the worst form of Government except all those other forms that have been tried from time to time.” Collective management of copyright is a little like democracy. It benefits consumers, it is simple and convenient for licensees, and it is (in theory) heavily regulated, at least in the UK and EU. It operates as not-for-profit, and creators have the right to influence policy.

The CMO system often meets with criticism, particularly from licensees. But, to direct to licensees an expression more folksy than Churchillian: “smashing up other people’s furniture doesn’t make your own furniture look any nicer.”

I for one will always try to defend the collective management model. But I expect every CMO to adhere to what I call LEFT principles: Lawful, Efficient, Flexible and Transparent.

I am not sure, on these facts, that presently the PRS in the UK is scoring on any of the four when it comes to live music royalty management and administration. And regrettably, I cannot tell you how much in live performance royalties is sitting at PRS, just as we cannot know the size of the black box of unattributed revenues.

In PRS’ 2024 accounts, total live performance revenues are buried under the general label “Public Performance,” and are shown as £287 million! The statutory Regulations require CMO transparency of, inter alia, the reporting of licensing sources. The PRS’ own Articles of Association (at 7 cA) (i) identify live performance as a revenue source. So why, despite these requirements, does the figure appear as simply the generic “public performance”?

We have to assume the sum includes licence revenues from shops, pubs, clubs etc collected via the PRS/PPL joint venture, and thus we cannot see the PRS’ live royalty total.

The Society’s current CEO is often in the press and has been voted Businesswoman of the Year by the industry. Does she preside over a system that is Lawful, Efficient, Flexible and Transparent? She rightly promotes increased revenues and reduced administration charges. But while she trumpets the Society’s work on ethnicity, diversity, gender equity and anti-misogyny, she has unfortunately also been quoted defending the HQ’s security systems as essential to protect the Society from members on the grounds that “they think it’s their money”!

It is inescapable that by the PRS’ own published information, writer members from more than 70,000 gigs are yet to be paid for their live work!

Disappointing? Helpful? Fair?

You decide.

In the next issue of the Beacon, we will explore what happens to live performance royalties in the USA when live performances take place and how the multitude of US CMOs “manage” them.

Buckle up for the next installment.

© Amanda Harcourt 2025