Musicians Forced to Sacrifice? ... Cosmetic Store Music Usage Fee Only 862 Won per Month

Court Recognizes Innisfree and Etude's Performance Rights Infringement
Korea Music Copyright Association Plans Appeal Over "Minimum Music Usage Fees"

An Innisfree store in Seoul.

[Asia Economy Reporter Kim Junran] The Korea Music Copyright Association (KOMCA) belatedly disclosed on the 9th that the court ruled that two domestic cosmetics companies must pay royalties for music usage. The association expressed its intention to immediately appeal, stating that the amount awarded by the court was absurdly low.

The Seoul Central District Court, Civil Division 208, ruled on the 21st of last month that Innisfree and Etude must return 5.88 million KRW and 3.71 million KRW respectively to the association as unjust enrichment. The court found that although the two companies had separate contracts with companies providing music in their stores, these contracts alone did not resolve the performance rights. It recognized that the two companies infringed on performance rights by using music without authorization.

However, KOMCA strongly criticized the ruling, saying, "At first glance, it seems like a victory, but the amount to be returned per store is only 862 KRW per month," and added, "This belittles the value of music and nullifies the efforts of musicians."

In calculating the unjust enrichment amount, the court applied the collection regulations used for coffee shops and similar establishments. These regulations are graded into six levels, ranging from a minimum of 2,000 KRW to 10,000 KRW per month. The court averaged the amounts across all grades to arrive at a monthly average usage fee of 5,750 KRW. Then, citing the short customer stay time and limited space in cosmetics stores, it reduced the amount by 85% to determine the final figure.

Choo Ki-yeol, chairman of KOMCA, said, "Despite this being a lawsuit against large corporate franchise headquarters rather than small franchise operators, rulings continue to force sacrifices only on musicians," and added, "Furthermore, while the current scope of performance royalty payments is limited to coffee shops and beer specialty stores, we plan to expand it to all business establishments that use music in the future."

According to the amendment to Article 11 of the Enforcement Decree of the Copyright Act, cafes, draft beer specialty stores, health clubs, complex shopping malls, and large stores must pay performance royalties if they play purchased music for multiple listeners starting from August 2018. However, traditional markets and small businesses with an area under 50㎡ are exempted.

Previously, KOMCA filed lawsuits against Innisfree and Etude, claiming that playing digital music in stores selling cosmetics constitutes performance rights infringement, seeking approximately 136.52 million KRW and 86 million KRW respectively.

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