04-28605. Rate Adjustment for the Satellite Carrier Compulsory License

AGENCY:

Copyright Office, Library of Congress.

ACTION:

Notice of voluntary negotiation period.

SUMMARY:

The Copyright Office of the Library of Congress is announcing the voluntary negotiation period for the purpose of determining the royalty fees for analog signals to be paid by satellite carriers under the satellite carrier compulsory license.

DATES:

The voluntary negotiation period commences on December 30, 2004 and concludes on January 10, 2005.

ADDRESSES:

If hand delivered by a private party, an original and five copies of voluntary agreements should be brought to Room LM-401 of the James Madison Memorial Building and the envelope should be addressed as follows: Office of the General Counsel/CARP, U.S. Copyright Office, James Madison Memorial Building, Room LM-401, 101 Independence Avenue, SE., Washington, DC 20559-6000 between 8:30 a.m. and 5 p.m. If delivered by a commercial courier, an original and five copies of voluntary agreements must be delivered to the Congressional Courier Acceptance Site located at 2nd and D Streets, NE. between 8:30 a.m. and 4 p.m. The envelope should be addressed as follows: Office of the General Counsel/CARP, Room LM-403, James Madison Memorial Building, 101 Independence Avenue, SE., Washington, DC. If sent by mail (including overnight delivery using U.S. Postal Service Express Mail), an original and five copies of voluntary agreements should be addressed to: Copyright Arbitration Royalty Panel (CARP), P.O. Box 70977, Southwest Station, Washington, DC. 20024. Voluntary agreements may not be delivered by means of overnight delivery services such as Federal Express, United Parcel Service, etc., due to delays in processing receipt of such deliveries.

FOR FURTHER INFORMATION CONTACT:

David O. Carson, General Counsel, or Gina Giuffreda, Attorney Advisor, Copyright Arbitration Royalty Panel (CARP), P.O. Box 70977, Southwest Station, Washington, DC. 20024. Telephone: [phone]. Telefax: [phone].

SUPPLEMENTARY INFORMATION:

Background

The satellite carrier compulsory license establishes a statutory copyright licensing scheme for satellite carriers that retransmit television broadcast signals to satellite dish owners for their private home viewing. 17 U.S.C. 119. Congress created the license in 1988 with the passage of the Satellite Home Viewer Act of 1988. Congress reauthorized the satellite license for additional five-year periods in 1994 and 1999, and the license was slated to expire on December 31, 2004. However, Congress again reauthorized the satellite license for another five years with the passage of the Satellite Home Viewer Extension and Reauthorization Act of 2004 (“the 2004 Act”) (as part of the Consolidated Appropriations Act, 2005), Pub. L. 108-447, which was signed into law by the President on December 8, 2004.

Satellite carriers pay royalties based on a flat, per-subscriber, per-month fee. These rates were initially set by Congress in the Satellite Home Viewer Act of 1988 and then later adjusted by a three-person arbitration panel convened by the former Copyright Royalty Tribunal. 57 FR 19052 (May 1, 1992). When the license was reauthorized in 1994, Congress directed that the rates be adjusted by the Librarian of Congress using the system that replaced the Copyright Royalty Tribunal, namely, ad hoc Copyright Arbitration Royalty Panels (“CARPs”) administered by the Librarian of Congress and the Copyright Office. Accordingly, the Librarian adjusted the rates in 1997. 62 FR 55742 (October 28, 1997). In the Satellite Home Viewer Improvement Act of 1999, which reauthorized the license for an additional five years, Congress reduced the rates set by the Librarian.

The 2004 Act adopts the rates as reduced by Congress in 1999 but calls for the amendment of those rates to be paid by satellite carriers for the secondary transmission of the primary analog transmission of network stations and superstations. This notice begins the process mandated by the statute.

Voluntary Negotiation Period

Sections 119(c)(1)(B) of the Copyright Act, 17 U.S.C., provides that “[o]n or before January 2, 2005, the Librarian of Congress shall cause to be published in the Federal Register [notice] of the initiation of voluntary negotiation proceedings for the purpose of determining the royalty fee to be paid by satellite carriers * * * under subsection (b)(1)(B).” This notice initiates the voluntary negotiation period.

The statute provides that “[w]ithin 10 days after publication in the Federal Register of a notice of the initiation of voluntary negotiation proceedings, parties who have reached a voluntary agreement may request that the royalty fees in that agreement be applied to all satellite carriers, distributors, and copyright owners without convening an arbitration proceeding.” 17 U.S.C. 119(c)(1)(D)(ii)(I). In accordance with this provision, the voluntary negotiation period commences today, December 30, 2004, and concludes January 10, 2005.

If a voluntary agreement is reached by the end of the negotiation period, the parties can request that the Librarian publish the agreement for notice and comment in accordance with section 119(c)(1)(D)(ii)(II) and adopt the rates in the voluntary agreement if no objections are received from a party with a significant interest and an intention to participate in an arbitration proceeding. 17 U.S.C. 119(c)(1)(D)(ii)(III). If an objection to the voluntary agreement is received or if parties are unable to reach a voluntary agreement, the statute dictates that the rates be determined under the current CARP system.^[1] Therefore, if a CARP proceeding becomes necessary, the Library must apply the rules and regulations of 37 CFR part 251. Consequently, should the parties be unable to reach a voluntary agreement by the end of the voluntary negotiation period or should a party with a significant interest and an intention to participate in an arbitration proceeding file an objection to the agreement, the Library will publish a subsequent notice calling for the filing of Notices of Intent to Participate.

Dated: December 27, 2004.

David O. Carson,

General Counsel.

Footnotes

1.  On November 30, 2004, the President signed into law the Copyright Royalty and Distribution Act of 2004, Pub. L. 108-419, which eliminates the CARP system and replaces it with three permanent Copyright Royalty Judges. However, the 2004 Act calls for satellite royalty rates to be determined “under chapter 8 as in effect on the day before the date of enactment of the Copyright Royalty and Distribution Act of 2004.” 17 U.S.C. 119(c)(1)(F).