OTT Eumdae Association to Ministry of Culture, Sports and Tourism: "Legal Action if Music Copyright Fee Standards Are Not Revised Again"

[Image source=Yonhap News]

[Asia Economy Reporter Kim Heung-soon] The OTT Music Copyright Countermeasure Council (OTT Eumdae-hyeop), composed of major domestic online video service (OTT) providers, announced on the 17th that it is urging the Ministry of Culture, Sports and Tourism to revise the recently approved OTT music copyright fee collection standards. They stated that if the revision is not made, they will actively consider legal actions such as administrative lawsuits.

In an official statement released that day, OTT Eumdae-hyeop said, "The Ministry of Culture, Sports and Tourism's approval of the Korea Music Copyright Association's (KOMCA) revised collection regulations on the 11th is not only a biased decision that seriously loses balance among stakeholders but also a clear abuse of discretion that violates the legal and procedural legitimacy required under copyright and administrative law." They declared their strong resolve to respond firmly.

Major domestic companies such as Wavve, TVING, Watcha, KakaoPage, and Lotte Cultureworks participate in OTT Eumdae-hyeop. Regarding the Ministry's announcement of a 1.5% music usage rate, they criticized, "In reality, it is no different from accepting a rate close to 2%, which KOMCA had claimed," adding, "They raised the base rate nearly threefold at once and plan to increase it further annually through a step-up coefficient." They also noted that although opinions were collected over four months from about 20 user companies, the industry's voices were ultimately ignored in the approval outcome.

Source: Provided by the Ministry of Culture, Sports and Tourism

OTT Eumdae-hyeop further stated, "The Ministry's decision thoroughly stifled the dynamism and development potential of OTT as a new industry," and "Domestic companies struggling to survive fierce competition against giant global corporations cannot help but feel despair." They strongly demanded that the Ministry recognize the procedural and substantive issues in the KOMCA collection regulation revision approval process and immediately undertake a re-revision. They emphasized, "If this legitimate demand is not accepted, we will actively consider legal responses such as filing administrative lawsuits as a last resort." They also called for the establishment of institutional improvements, including strengthening management and supervision of KOMCA.

According to the revised bill approved earlier by the Ministry, a new clause for 'video transmission services' applicable to OTT was introduced. The music copyright usage rate for OTT videos, where music works are used as incidental purposes, will start at 1.5% in 2021 and gradually increase annually to a final 1.9995% in 2026. For content primarily using music works, such as music entertainment or live performances, the music copyright usage fee is set at 3.0%.

Until now, KOMCA submitted a revision bill setting the music copyright usage rate at 2.5% of sales, citing reports published by the International Confederation of Societies of Authors and Composers (CISAC) and contracts with global OTT Netflix. On the other hand, major domestic OTT providers argued that about 0.625% of sales is appropriate based on the existing 'broadcast retransmission service' regulations applied to broadcasters' internet catch-up services. With the rates claimed by both sides differing by about four times, the revision was approved at a rate closer to KOMCA's demand.

This content was produced with the assistance of AI translation services.