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What is the Promotional Royalty Rate [Patents] and Its Legal Implications?
Definition & Meaning
The promotional royalty rate refers to a specific statutory royalty rate set at zero for certain types of promotional interactive streams and promotional limited downloads. This definition is outlined in 37 CFR 385.11, which governs the rates and terms for the use of musical works under compulsory licenses. Essentially, this means that when music is distributed for promotional purposes, no royalty fees are required under certain conditions.
Table of content
Legal Use & context
This term is primarily used in the context of copyright law, specifically relating to the distribution of musical works. It is relevant for artists, record labels, and streaming services that engage in promotional activities. Understanding the promotional royalty rate is crucial for those involved in the music industry, as it allows for the legal distribution of music without incurring royalty fees, provided the streams or downloads meet specific criteria.
Key legal elements
Real-world examples
Here are a couple of examples of abatement:
Example 1: A record label releases a new album and allows users to stream select tracks for free as part of a promotional campaign. Since these streams qualify as promotional, the label does not owe any royalties.
Example 2: An artist offers a limited download of their new single for a short promotional period. If the download meets the criteria specified in the regulations, it falls under the promotional royalty rate, and no fees are required. (hypothetical example)
Relevant laws & statutes
The primary legal reference for the promotional royalty rate is found in 37 CFR 385.11, which is part of the regulations established by the Copyright Royalty Board. This regulation outlines the rates and terms for the use of musical works under compulsory licenses.
Comparison with related terms
Term
Definition
Difference
Statutory Royalty Rate
The fixed rate established by law for the use of copyrighted works.
The promotional royalty rate is specifically set at zero for promotional uses, while the statutory rate may vary.
Compulsory License
A license that allows the use of copyrighted material without the owner's permission under certain conditions.
The promotional royalty rate applies within the framework of a compulsory license but has specific promotional criteria.
Common misunderstandings
What to do if this term applies to you
If you are involved in the distribution of music and are considering promotional streams or downloads, ensure you understand the criteria that qualify for the promotional royalty rate. You may want to consult legal resources or templates available through US Legal Forms to assist you in navigating these regulations. If your situation is complex, seeking professional legal advice is advisable.
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