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Music Giants Fight For Royalties
http://www.sina.com.cn 2004/03/04 08:28  Shanghai Daily

  More than 50 music companies, including some of the world's largest entertainment firms, are taking action to compel China's karaoke bars to pay licensing fees for using their music video discs.

  Universal Music, EMI Music and Warner Music together with other foreign and domestic companies hired Beijing Tenwell Law Firm and Beijing Ying Ke Law Firm to deal with the issue. They expect to get annual royalties ranging from 7,000 yuan (US$844.4) to 120,000 yuan from each karaoke bar, depending on the bar's size and revenue.

  It is the first time that music companies worked together on the issue. They want to establish a common stand on the matter and regulate the market, industry insiders said.

  "It is a recognized global rule that bars have to pay for the commercial use of music video discs," said Wang Fei, a Tenwell's lawyer involved in the case. "The Chinese copyright law also supports the claim. What we can discuss is how much should be charged."

  In Japan and South Korea, similar bars pay up to 50 percent of their revenues to the studios as royalty fees, according to industry sources.

  Meanwhile, some recent court cases have given music companies a legal basis to fight for the royalty payments. Last month, Sony Music Entertainment (Hong Kong) Ltd filed a lawsuit against the Cashbox Karaoke Bar for screening discs without permission and asked for compensation of up to 350,000 yuan. The parties are currently negotiating an out-of-court settlement.

  In December, Hong Kong-based Go East Entertainment Co Ltd won a case against a Beijing karaoke bar and was awarded 56,376 yuan compensation.

  Karaoke bars in Beijing, Shanghai and Guangzhou will receive a letter from the law firm this month, which urges them to apply for permission from the music companies and pay royalties for 2003. Other karaoke bars in China, which has more than 10,000 of them, will receive the letter sometime this year.

  "If any karaoke bar refuses to do so (pay royalties), we will resort to the court," said Wang.

  Gu Enjie, a manager with Shanghai Holiday Music Entertainment Co Ltd, a popular karaoke club which has six outlets in Shanghai, said he has not got the letter so far, but "will negotiate with the entertainment companies on royalty fee."




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