Allocation for Music Producers Act

In October 2018, as the third part of the Music Modernization Act, U.S. copyright law was changed to provide a right to producers, mixers, and sound engineers to receive payment for taking part in the creative process that created a sound recording.

The text of the Allocation for Music Producers Act (the “AMP Act”) is set forth below (though the text below is, for now, un-formatted in this post–sorry about that ).

SEC. 302. PAYMENT OF STATUTORY PERFORMANCE ROYALTIES. (a) Letter of Direction.–Section 114(g) of title 17, United States Code, is amended by adding at the end the following new paragraph: “(5) Letter of direction.– “(A) In general.–A nonprofit collective designated by the Copyright Royalty Judges to distribute receipts from the licensing of transmissions in accordance with subsection (f) shall adopt and reasonably implement a policy that provides, in circumstances determined by the collective to be appropriate, for acceptance of instructions from a payee identified under subparagraph (A) or (D) of paragraph (2) to distribute, to a producer, mixer, or sound engineer who was part of the creative process that created a sound recording, a portion of the payments to which the payee would otherwise be entitled from the licensing of transmissions of the sound recording. In this section, such instructions shall be referred to as a `letter of direction’. “(B) Acceptance of letter.–To the extent that a collective described in subparagraph (A) accepts a letter of direction under that subparagraph, the person entitled to payment pursuant to the letter of direction shall, during the period in which the letter of direction is in effect and carried out by the collective, be treated for all purposes as the owner of the right to receive such payment, and the payee providing the letter of direction to the collective shall be treated as having no interest in such payment. “(C) Authority of collective.–This paragraph shall not be construed in such a manner so that the collective is not authorized to accept or act upon payment instructions in circumstances other than those to which this paragraph applies.”. (b) Additional Provisions for Recordings Fixed Before November 1, 1995.–Section 114(g) of title 17, United States Code, as amended by subsection (a), is further amended by adding at the end the following new paragraph: “(6) Sound recordings fixed before november 1, 1995.– “(A) Payment absent letter of direction.–A nonprofit collective designated by the Copyright Royalty Judges to distribute receipts from the licensing of transmissions in accordance with subsection (f) (in this paragraph referred to as the `collective’) shall adopt and reasonably implement a policy that provides, in circumstances determined by the collective to be appropriate, for the deduction of 2 percent of all the receipts that are collected from the licensing of transmissions of a sound recording fixed before November 1, 1995, but which is withdrawn from the amount otherwise payable under paragraph (2)(D) to the recording artist or artists featured on the sound recording (or the persons conveying rights in the artists’ performance in the sound recording), and the distribution of such amount to one or more persons described in subparagraph (B) of this paragraph, after deduction of costs described in paragraph (3) or (4), as applicable, if each of the following requirements is met: “(i) Certification of attempt to obtain a letter of direction.–The person described in subparagraph (B) who is to receive the distribution has certified to the collective, under penalty of perjury, that– “(I) for a period of not less than 120 days, that person made reasonable efforts to contact the artist payee for such sound recording to request and obtain a letter of direction instructing the collective to pay to that person a portion of the royalties payable to the featured recording artist or artists; and “(II) during the period beginning on the date on which that person began the reasonable efforts described in subclause (I) and ending on the date of that person’s certification to the collective, the artist payee did not affirm or deny in writing the request for a letter of direction. “(ii) Collective attempt to contact artist.–After receipt of the certification described in clause (i) and for a period of not less than 120 days before the first distribution by the collective to the person described in subparagraph (B), the collective attempts, in a reasonable manner as determined by the collective, to notify the artist payee of the certification made by the person described in subparagraph (B). “(iii) No objection received.–The artist payee does not, as of the date that was 10 business days before the date on which the first distribution is made, submit to the collective in writing an objection to the distribution. “(B) Eligibility for payment.–A person shall be eligible for payment under subparagraph (A) if the person– “(i) is a producer, mixer, or sound engineer of the sound recording; “(ii) has entered into a written contract with a record company involved in the creation or lawful exploitation of the sound recording, or with the recording artist or artists featured on the sound recording (or the persons conveying rights in the artists’ performance in the sound recording), under which the person seeking payment is entitled to participate in royalty payments that are based on the exploitation of the sound recording and are payable from royalties otherwise payable to the recording artist or artists featured on the sound recording (or the persons conveying rights in the artists’ performance in the sound recording); “(iii) made a creative contribution to the creation of the sound recording; and “(iv) submits to the collective– “(I) a written certification stating, under penalty of perjury, that the person meets the requirements in clauses (i) through (iii); and “(II) a true copy of the contract described in clause (ii). “(C) Multiple certifications.–Subject to subparagraph (D), in a case in which more than one person described in subparagraph (B) has met the requirements for a distribution under subparagraph (A) with respect to a sound recording as of the date that is 10 business days before the date on which the distribution is made, the collective shall divide the 2 percent distribution equally among all such persons. “(D) Objection to payment.–Not later than 10 business days after the date on which the collective receives from the artist payee a written objection to a distribution made pursuant to subparagraph (A), the collective shall cease making any further payment relating to such distribution. In any case in which the collective has made one or more distributions pursuant to subparagraph (A) to a person described in subparagraph (B) before the date that is 10 business days after the date on which the collective receives from the artist payee an objection to such distribution, the objection shall not affect that person’s entitlement to any distribution made before the collective ceases such distribution under this subparagraph. “(E) Ownership of the right to receive payments.– To the extent that the collective determines that a distribution will be made under subparagraph (A) to a person described in subparagraph (B), such person shall, during the period covered by such distribution, be treated for all purposes as the owner of the right to receive such payments, and the artist payee to whom such payments would otherwise be payable shall be treated as having no interest in such payments. “(F) Artist payee defined.–In this paragraph, the term `artist payee’ means a person, other than a person described in subparagraph (B), who owns the right to receive all or part of the receipts payable under paragraph (2)(D) with respect to a sound recording. In a case in which there are multiple artist payees with respect to a sound recording, an objection by one such payee shall apply only to that payee’s share of the receipts payable under paragraph (2)(D), and shall not preclude payment under subparagraph (A) from the share of an artist payee that does not so object.”. (c) Technical and Conforming Amendments.–Section 114(g) of title 17, United States Code, as amended by subsections (a) and (b), is further amended– (1) in paragraph (2), by striking “An agent designated” and inserting “Except as provided for in paragraph (6), a nonprofit collective designated by the Copyright Royalty Judges”; (2) in paragraph (3)– (A) by striking “nonprofit agent designated” and inserting “nonprofit collective designated by the Copyright Royalty Judges”; (B) by striking “another designated agent” and inserting “another designated nonprofit collective”; and (C) by striking “agent” and inserting “collective” each subsequent place it appears; (3) in paragraph (4)– (A) by striking “designated agent” and inserting “nonprofit collective”; and (B) by striking “agent” and inserting “collective” each subsequent place it appears; and (4) by adding at the end the following new paragraph: “(7) Preemption of state property laws.–The holding and distribution of receipts under section 112 and this section by a nonprofit collective designated by the Copyright Royalty Judges in accordance with this subsection and regulations adopted by the Copyright Royalty Judges shall supersede and preempt any State law (including common law) concerning escheatment or abandoned property, or any analogous provision, that might otherwise apply.”. SEC. 303. EFFECTIVE DATE. (a) In General.–Except as provided in subsection (b), this title and the amendments made by this title shall take effect on the date of the enactment of this Act. (b) Delayed Effective Date.–Paragraphs (5)(B) and (6)(E) of section 114(g) of title 17, United States Code, as added by section 302, shall take effect on January 1, 2020.