Think your Company Is in Compliance with the Copyright Act: Listen Carefully

Date01 January 2019
Published date01 January 2019
Think your Company Is in
Compliance with the Copyright
Act: Listen Carefully
Dana L. Hart and Robert D. Slater
Compliance with
laws and regulations
is one of the primary
objectives of every
model of corporate
governance. A dra-
matic rise in the
number of chief com-
pliance ofcers
(CCO) in organiza-
tions, conrms that
companies realize the
value of compliance
(Lorde Martine, 2015). The
cost of violating laws and regu-
lations often goes beyond just
legal penalties. The adverse
publicity generated by coverage
of a compliance issue may
erode a rms stock price
(Rezee, Espahbodi,
Espahbodi, & Espahbodi,
2012). In many cases, this loss
of market capitalization is
larger than the legal nes. For
some investors, violations of
laws and regulations may be
signs of a weak internal control
structure. CCO and chief audit
executives (CAE) should work
together to develop a compre-
hensive strategy to create and
monitor a companys compli-
ance strategy.
One often overlooked com-
pliance issue for businesses is a
provision of the Copyright Act
dealing with the performance
of copyrighted works. Any
company that has music or
televisions playing in areas
where customers shop, eat,
drink, dance, or otherwise
congregate should
probably brush up on
their understanding
of performance
under the Copyright
Act of 1976 (2012)
before one or all of
Rights Organizations
(PROs) sues the
business for copyright
Managers or owners
may not always under-
stand what is aper-
formanceof copyrighted work.
While some businesses assume
their companys practices are
exempted by either the home-
style exemption (§110[5]) or the
Fairness in Music Licensing Act
(1998), this is often an incorrect
assumption. Most companies
avoid nes under the Copyright
music subscription. However, all
companies, even ones with com-
mercial music subscriptions,
should train and monitor
employee compliance with
Companies who use music or video to entertain
customers need to maintain compliance with the
performanceprovisions of the Copyright Act.
Many businesses assume they are automatically
exempt from paying royalties under the Copyright
Acts Homestyle Exemption or the Fairness in
Music Licensing Act of, 1998. Companies are
often surprised to nd they owe royalties to
Performance Rights Organizations. This article
discusses the Copyright Act and the compliance
issues associated with playing copyrighted works
within a business. © 2019 Wiley Periodicals, Inc.
© 2019 Wiley Periodicals, Inc.
Published online in Wiley Online Library (
DOI 10.1002/jcaf.22372 171

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT