Below the general policies for Producer Rights Denmark (PRD) are presented.
It follows from the Act on Collective Management of Copyright and related rights, that PRD's general meeting must make decisions on the general policies regarding:
- revenue distribution to right holders
- deductions from revenue to right holders
- non-distributable funds
- investment policy
At PRD's general meeting April 30, 2019, the present general policies were decided.
Below the general policy for PRD's revenue distribution to right holders is presented.
At the general meeting April 30, 2019, it was decided that revenue be distributed according to the following principles:
- Revenue must be distributed on the basis of objective distribution principles. When managing rights and distributing rights revenue, PRD must in no way discriminate against right holders, but is under an obligation to ensure equal terms for everyone regardless of nationality, affiliation, etc.
- Revenue deriving from a business area must be disbursed to the right holders whose productions have been used in the business area concerned. However, within the individual business areas, PRD’s board may choose to limit payment of remuneration for exploitations on channels and/or platforms with a certain reach, if the resources required to ensure full disbursement for all channels/platforms do not match up to the revenue from these areas.
- In principle PRD is required to distribute revenue individually on the basis of full reporting on the use of productions. However, PRD’s board may choose to distribute remuneration based on random sample reporting or the use of an analogue basis, if the resources required to collect full reporting do not match up to the revenue available for distribution from the area.
- PRD’s board must ensure that specific distribution rules are drawn up in accordance with the general principles adopted for the distribution of remuneration as well as with article 8 of the statutes.
- The specific rules for distributing remuneration decided by PRD’s board must be available on PRD’s website along with the general distribution principles adopted by the general meeting.
Deductions from revenue
Below the general policy for PRD's deductions from revenue to the right holders is presented.
PRD has deductions for administration costs and deductions for cultural funding.
At the general meeting April 30, 2019, it was decided that the following principles are applied to the deduction of administration costs:
- It follows from the Act on Collective Management that administration costs may not exceed the justified and documented costs.
- Prior to each calendar year a budget is made of the costs of Filmret ApS in the upcoming year for managing the rights and rights revenue handled by PRD.
- The administration percentage is set on the basis of the upcoming year’s expected disbursements of rights revenue and is calculated as budgeted management costs / expected disbursements of rights revenue = rounded administration percentage.
- Administration costs at the administration percentage are set off against each disbursement of rights revenue for each business area.
- If the deduction to cover administration costs deviates from the administration costs incurred, the deviation is included in the calculation of the following year’s administration percentage.
- PRD provides Filmret ApS with a loan facility for an amount corresponding to one year’s administration costs, always provided that the loan is repayable within the year.
- The board of PRD approves the upcoming year’s administration costs and administration percentage prior to each calendar year.
The board has initiated a project to investigate ways of improving the way administration costs are deducted, though from 2020 at the earliest. Accordingly, as an alternative to the method above, the board of PRD can decide to collect administration costs direct from revenue received rather than collect administration costs as a percentage of disbursed revenue. However, changing the method must not lead to an increase in total administration costs.
Deductions for cultural funding may be made from members’ rights revenue and from revenue disbursed to non-members who receive rights revenue from PRD as a result of licences issued under the authority of the provisions of the Danish Copyright Act concerning extended collective licence.
In areas where PRD has concluded reciprocal agreements with foreign management organisations, deductions for cultural funding may only be made if the reciprocal agreement provides direct authority to do so.
At the general meeting April 30, 2019, it was decided that the following principles be applied to deductions for cultural funding:
- Deductions for cultural funding in a royalty year may amount to no more than 5% of the total revenue relating to the previous royalty year.
- Deductions for cultural funding are made in the main business areas retransmission (both basic and commercial channels) and digital services.
- Cultural funding is awarded on the basis of specific applications submitted to PRD’s board. Only businesses/organisations may apply to the board for cultural funding.
- PRD is obliged to disclose on its website the organisations that have received cultural funding from PRD as well as the amount granted.
- Organisations whose applications for cultural funding are approved must comply with the rules set out in the Act on Collective Management and the guidelines drawn up by Copydan for the use of cultural funding and must ensure that PRD will remain free from any responsibility or liability in this regard.
Below the general policy for PRD's use of non-distributable funds is presented.
At the general meeting April 30, 2019, it was decided that the previous year's practice concerning time limitation of non-distributable funds be followed. According to this practice, these funds become time-barred three years after the expiry of the year to which the funds relate. Such three-year limitation period is in accordance with the rules set out in the Act on Collective Management; see section 16(7).
In the period from the receipt of rights revenue until the limitation period expires, it is Filmret ApS’ duty to ensure that all reasonable efforts are initiated to identify the individual right holders so that the rights revenue can be disbursed. Thorough, repeated searches for the correct right holders are to be made, for example, by searching the internet, contacting cooperative partners in Denmark, contacting organisations abroad in the case of foreign right holders, together with other relevant measures.
It has further been decided that rights revenue remaining undisbursed after the three-year period mentioned and is thus non-distributable be used as follows:
- A 10% reserve of the non-distributable and time-barred funds, although no more than DKK 2 million, is to be deposited in a reserve fund to meet any legitimate financial claims from right holders. The funds are to be taken proportionately from the individual business areas, but the use thereof is not otherwise related to a specific rights year or business area. The reserve fund is intended as a general reserve.
- Filmret ApS’ administration is entitled to make disbursements from the reserve fund to right holders having a legitimate financial claim against PRD. If the administration is in doubt about the legitimacy of a right holder’s financial claim, it must involve PRD’s board in the handling of the matter.
- The amount held in the reserve fund may never exceed DKK 5 million. Should the total balance amount to DKK 5 million, then no further amounts are to be taken in reserve from the time-barred funds.
- The remaining portion of the time-barred funds is to be allocated for redistribution within the business areas from which the rights revenue derives.
- The redistributed rights revenue becomes payable in connection with the next main disbursement for the business area to which the rights revenue relates.
Below the general policy for PRD's investment policy for rights revenue is presented.
At the general meeting April 30, 2019, it was decided that the following principles be applied to the investment of rights revenue:
- Rights revenue held by PRD is placed in current accounts
- No investments are made