A SMALL RADIO CAN LAND YOU WITH A BIG BILL

Rural shopkeepers are not usually angry people – dealing with the great British public every day needs real tolerance, as does implementing a great raft of laws, all apparently designed for Tesco-sized companies! But one issue that seems guaranteed to create real anger is the law governing the playing of music in shops. Often the first retailers know of the need to pay is when they receive an aggressive phone call demanding that they buy a licence. A number of shopkeepers have asked us to clarify the Alice-in-Wonderland world of “public broadcasting”. Please note that the RSA has nothing to do with the system – we are only reporting it!
There are two separate bodies that collect licence fees for music. The PRS collects money on behalf of the composers. PPL separately collects money on behalf of the record companies and artists. If you play music, a TV or radio in your shop you are required to pay a fee to both organisations.

Performing Rights Society (PRS for Music)
Under the Copyright, Design and Patents Act 1988 (as amended) if you play copyrighted music outside of your home life you must obtain the permission of the copyright holder. In practice this means the PRS. Hence recorded music, including through TV or radio, played in a shop or even in its staff rest area, is covered.
The current PRS standard Shops and Stores Tariff applies when there are up to four people employed in the shop. It includes permission to play music in both the sales area and the backshop. For an audible area up to 100 sq. m. (1,076 sq.ft.) the standard rate at time of writing is £136.70 + VAT, for areas up to 150sq.m. (1,615 sq.ft.) it is £199.80 + VAT per year. “Audible area” is defined as the part of the premises wall-to-wall to which the public is admitted and music is audible. There is a reduced rate of £73.60 + VAT where there is only a single portable radio or small TV, audible over an area under 100sq.m. That’s the good news; the bad news is that there are additional charges where music is provided in staff areas for five or more employees at a time.
Last year the PRS had an income of more than £600m. and its highest paid director received £425,000. This remuneration is potentially the income from over 3,000 village stores playing music – rather at odds with the idea of collecting money for composers starving in their unheated garrets!
The PRS is facing a major legal challenge later in the year. In a case in the High Court, PRS are claiming £200,000 from the car tyre company Kwik-Fit. This is for seven years back payment to cover radios that their fitters brought to their workplace for their own listening; these were nothing to do with the company. This could be a very interesting test case. Watch this space!

Phonographic Performance Ltd (PPL)
PRS collects money for composers, but the rights to the specific performance of their music are held separately, usually in practice by PPL. So you need this second licence to play recorded music in a non-domestic setting, with the money going to the record companies and the musicians.
If your shop has an audible area of less than 50sq.m. (538 sq.ft.) and you play only “traditional” radio or TV broadcasts, there is a PPL “concessionary rate” tariff of £58.10 + VAT per annum.
The standard rate for a shop up to 100 sq.m. is £116.20 + VAT, for 101-200 sq.m. it is £174.30 + VAT.
Back in 2004, PPL tried to simplify their scheme. However, this led to an increase in fees of up to 400% for some users. The Government referred the issue to the Copyright Tribunal in December 2004 and the case subsequently went to appeal. The judge in the appeal ruled against PPL, stating that the system they had developed was "inconvenient, cumbersome, expensive, and involved a waste of judicial and public resources". He also ruled it to be a misinterpretation of the Act.
The Copyright Tribunal is expected to reconvene in May to determine the appropriate level of charges, which should lead to a reduction in the fees paid by users of copyright music in-store. Affected retailers may receive a substantial reduction in charges and there is a likelihood that the court will make PPL repay a proportion of fees charged dating back to 2005. This system is really moving slowly. PPL themselves have said it needs an overhaul and the RSA agrees with them.
In 2007, the PPL had an income from licences of £115m. That year, their highest paid director received emoluments of £740,000.

The View of the RSA
We asked the RSA Sounding Board members for their views on this issue. Thank you to all of you who responded and we have published a cross-section of your comments. This clearly is an issue where strong emotions apply. The key issue seems to be that small village shops are caught up in legislation really intended for public performances. Music in small shops is usually for the benefit of owners and maybe a couple of staff, not for customers. It feels like playing music in your own home. After all, a customer popping in for a packet of cigarettes or a chocolate bar would be lucky to catch a complete verse, let alone enjoy a full “performance”. Although we can fully understand the aggressive approaches reported by shopkeepers (this is an area where “nice” probably doesn’t work), nevertheless it leaves a bitter taste.
We will keep you informed on developments, but in the meantime, do please let us have details of your experiences and your views.

For more information:
PPL
1 Upper James Street, London, W1F 9DE
020 7534 1070
www.ppluk.com

PRS for Music
Copyright House, 29-33 Berners St, London W1T 3AB
020 7580 5544
www.prsformusic.com

QUOTES

I have a small radio, which I use to listen to Radio 4. If the PRS demand money for a licence fee then they will be wearing the radio!!!!

In our village shop we have our radio tuned to BBC Radio Cornwall. It isn't for customers - we need to know what is going on. We would be happy if no music was played. We would rather remove the radio (than pay a licence), but haven't done so as yet. We’ve been approached by letter several times. Eventually my wife told them to get lost and to take us off their mailing list and to spend their money more sensibly.
To date we have not played "background" music due to cost, so far we have not been approached by the PRS.

We used to play music in the back office to break up the silence during quiet periods, as a security measure to give the impression that someone was out back and also because we really enjoy music! We are a very small shop (approx 270sqft) which is run by my partner and myself, our daughter and one Saturday staff work part time. The music was not broadcast to the public in any way and could barely be heard in the shop. We received a letter PRS last year telling us that we needed a licence and to be honest I was shocked.
I felt I could just about justify a fee of around £20 - £30 pounds to be able to continue playing the radio but the price of over £100 was ridiculous. I was also unhappy about the heavy-handed approach they used, mentioning court action etc with a fine that could be any amount!

It really has affected our working lives quite considerably. There are times when there is only one of us in the shop and not having some background noise really does make a difference. In fact music while you are working really does affect how you feel. We spend up to 14 hours as day in the shop and it has been horrible not being able to listen to some music. I cannot believe that this is really what musicians (or radio advertisers) would want. Surely they write songs to be heard (which may lead to us purchasing their albums and attending their concerts) which thanks to this licence is now not happening in 1000's of workplaces around the country.


If we were playing music for our customers then we can understand the need for a licence fee but in a small village shop with a transistor radio behind the counter we do not agree. The only alternative is for us to stand behind our shop counter wearing headphones!