NCC Remits 1.2B Copyright Levy to MCSN, ReLPI Demands Transparency 

In a statement by Musical Collection Society of Nigeria (MCSN) made available to Pulse Nigeria, the society thanked President Bola Tinubu, the DG of NCC John Assien, and the Minister of Justice Lateef Fagbemi SAN on disbursement of One Billion, Two Hundred and Five Million Nine Hundred and Fifty-Six Thousand, Five Hundred and Eighty Naira, Twenty Kobo (N1,205,956,580.20) which is the first tranche of the copying levy for musical works and sound recordings as provided by Section 4 of the Copying (Levy On Material) Order 2021.

In the statement, MCSN celebrated the payment as a new dawn for right owners in the Nigerian music industry, especially those in the grassroots, who the society promises would be beneficiaries, irrespective of location. 

Readers will recall that Pulse Nigeria reported the ongoing controversy surrounding the disbursement of the copyright levy by the Nigerian Copyright Commission (NCC).

The Musical Collection Society of Nigeria (MCSN) is the only Collective Management Organisation recognised by the NCC who insisted on paying the copying levy to the society despite the objection of Record Labels Proprietors Initiative (RELPI), who opted out of MCSN’s collective management in exercising its rights under section 88 (9) of the Nigerian Copyrights Act 2022.

RELPI, which is made up of several record labels, including global majors Sony Music, Universal Music, and Warner Records, Mavin Records, and Chocolate City, insisted upon its right to receive the copyright levy on behalf of its members by virtue of Section 89 (3)  of the Nigerian Copyrights Act 2022.

The payment of the copyright levy to MCSN is a bold statement by the NCC, who have all but thrown its weight behind the society as the only recognised CMO in Nigerian despite the provisions of Section 89 (3) of the Nigerian Copyrights Act 2022 and the recent attempt by a high-level Federal Government team to address the issues raised by RELPI. 

In the statement announcing the payment of the copyright levy, MCSN described RELPI’s campaign as lacking merit, as the organisation failed to properly define its status and interests.

The CMO also added that the Performing Musicians’ Association of Nigeria (PMAN), which is the only legally recognised union/association of performing and employers of musicians (including recording producers and labels), has a subsisting agreement with MCSN, with which MCSN represents the copyright interests of all performers and producers in Nigeria.

“The latest of such antics is the one being peddled by Record Labels Proprietors Initiative (RELPI), which is falsely campaigning that they represent sound recording owners, without properly defining their status and interests.

For a start, sound recordings are a shared interest between record producers and performers (performing musicians) whose performances were recorded.  The rights in sound recordings are normally shared between the producers and performers, in certain territories at the ratio of 50% a-piece.

In Nigeria, most performers (performing musicians) whose performances were recorded in albums are direct members and assignors of MCSN, vis-à-vis many independent record producers and label owners.  These are the real owners of sound recordings in Nigeria.

The Performing Employers’ Association of Nigeria (PMAN), which is the only legally recognised union/association of performing and employers of musicians (including recording producers and labels), has a subsisting agreement with MCSN with which MCSN represents the copyright interests of all performers and producers in Nigeria.”

PMAN in its statement backed the MCSN and commended the Federal government for releaseung first tranche of the Copyright Levy. In the statement by its president, Pretty Okafor, PMAN described the payment of the levy as an important step toward stronger protection and better welfare for Nigerian performing musicians.

MSCN insisted that it’s within the discretion of every country to determine the protection of intellectual property within its territory. It added that RELPI’s members are mostly foreign entities, portraying a picture of a deficient collection structure in Nigeria without attempting to support the efforts of the NCC-backed MCSN. 

“Every country determines how intellectual property, particularly copyright, is protected within its territories in line with relevant international, bilateral, and multilateral conventions and treaties.  Nigeria is not an exception, as it has in place its law, the Copyright Act 2022, under which copyright in seven or eight categories of works/rights are protected within the Nigerian economy and market.

RELPI, based on their public statement and publication, consists of only 9 entities, namely Mavin Records, Chocolate City, Davido Music Worldwide (DMW), Premier Records, Universal Music Group (UMG), Sony Music Entertainment (SME), Warner Music Group (WMG), Digital Music Commerce & Exchange (DMCE,) and Hypertek Digital.

These entities are mostly foreign-interest dominated who mostly operate within the collective management system in their various home countries.  The collective management systems in their various home countries, particularly UMG, WMG, and SME, are operating very well with these entities as members either as publishers or producers.

Coming to Nigeria, they are presenting the picture that nothing good works in Nigeria, without taking any step to support what the government is building through the MCSN, AVRS, and REPRONIG; the three collective management organisations (CMOs) operating in Nigeria.  Lifting the veil a bit more, certain members of RELPI are agents or lawyers acting as agents of certain of these foreign entities, and as agents, they are merely fighting to protect and sustain their expected commission.  In all, the activities and campaign of RELPI is for the foreign entities to take over the Nigerian creative market using the back door, through the cover of copyright ownership.  This most certainly is against the fundamental national interest of Nigeria and Nigerians.  It is also against the policy of the African Union, which is working towards making and establishing strong CMOs in its member-countries.”

MCSN thanked the NCC and the Ministry of Justice for implementing the copyright levy and eliminating the confusion that has rocked the Nigerian music industry as it pertains to the licensing or copyright works and the payment of royalties. 

In its statement reacting to the payment of the copyright levy to MCSN, The Record Label Proprietors’ Initiative Ltd/Gte. (ReLPI) welcomed the Federal Government’s activation of long-standing statutory mechanisms designed to strengthen Nigeria’s creative economy and improve remuneration for creators and rightsholders. 

In the statement signed by its Chairman, Tega Ogenejobo, made available to Pulse Nigeria, ReLPI stated that it is in the interest of public clarity, legal certainty, and industrial stability to clarify some issues surrounding MCSN’s establishment and mandate, which is to manage rights in musical composition. RELPI maintains that the NCC’s approved CMO doesn’t have the mandate, doesn’t cover, or extend to the administration or collection of revenues on behalf of sound recording owners.

“We also acknowledge the roles of relevant public institutions and some creative industries stakeholders in advancing this process. However, in the interest of public clarity, legal certainty, and industry stability, ReLPI considers it necessary to place certain issues in their proper legal and institutional context. MCSN is currently established to administer and manage rights in musical compositions. 

While its public statement alludes to broader industry interests, it is important to state explicitly that its legal remit does not extend to the administration or collection of revenues on behalf of sound recording owners. Under Nigerian copyright law, musical works and sound recordings are distinct categories of protected works, each with separate ownership structures, rights, and modes of administration. 

The fact that there remains a gap within Nigeria’s collective management framework for sound recordings does not confer automatic authority on any existing collective management organisation to assume that role without a clear statutory basis or an express mandate from sound recording owners. Such authority can only arise through due process and direct authorisation by the affected rightsholders.”

ReLPI maintained that its position is not an attack on the collective management or an attempt to undermine government policy. Rathe it’s based on principled policy aimed at ensuring that copyright revenues, particularly those attributable to sound recordings, are administered strictly in accordance with the Copyright Act and principles of transparency. 

“ReLPI’s intervention on this matter is therefore not an attack on collective management, nor an attempt to undermine government policy. Rather, it is a principled policy and structural engagement aimed at ensuring that copyright revenues, particularly those attributable to sound recordings, are administered strictly in accordance with the Copyright Act, 2022, and established principles of transparency, accountability, and good governance. 

Sound recordings are owned by record labels and self-producing artists, and any levy or revenue attributable to sound recordings must be distributed through mechanisms that are accountable to owners of sound recordings.

Any interim or permanent arrangement for sound recording revenues must therefore be grounded in the express authority of sound recording rights owners and subject to appropriate oversight. ReLPI is a duly registered company limited by guarantee representing record labels, self-producing artistes, and owners of sound recordings who have expressly mandated it to act on their behalf.”

Addressing MCSN’s claim that ReLPI consists of a handful of labels, yet to define their interest, the record labels clarified that their members consist of a staggering 55% of Nigeria’s recorded music market. 

“While ReLPI’s active membership presently consists of a defined number of entities, those members collectively account for over 55% of Nigeria’s recorded music market and represent hundreds of Nigerian artistes, sound recording owners, and a wide network of companies providing critical services across the music ecosystem. The sound recordings owned, financed, and commercially exploited by ReLPI members include works by some of Nigeria’s most prominent cultural exports, including Davido, Wizkid, Burna Boy, Tems, Rema, Ayra Starr, Johnny Drille, Ladipoe, Crayon, Magixx, Adekunle Gold, Omah Lay, ODUMODUBLVCK, 2Face Idibia, Young Jonn, Blaqbonez, Candy Bleakz, Oxlade, Simi, CKay, Mayorkun, Andre Vibez, Jim Rex Lawson, Bobby Benson, Osita Osadebe, Victor Uwaifo, Celestine Ukwu, and many others.”

On MCSN’s claim that ReLPI's members are foreign entities with interests that don’t appreciate the local efforts to build a collection system in the Nigerian music ecosystem, RELPI stated that Nigeria’s recorded music industry operates within a globalised commercial environment.

“With respect to suggestions that ReLPI’s members are “foreign-interest dominated,” it is important to recognise that Nigeria’s recorded music industry operates within a globalised commercial environment.

Nigerian-incorporated entities and lawfully operating subsidiaries or affiliates of international record companies invest substantially in Nigerian talent, employ Nigerian professionals, pay taxes locally, and export Nigerian culture worldwide. Their participation strengthens, rather than diminishes, Nigeria’s national and economic interests. ReLPI also notes that in countries where collective management works well, it is because different types of rights are clearly separated, and each is managed only with the clear permission of the right owners. 

These systems are transparent, accountable, and usually have separate structures for musical compositions and sound recordings. ReLPI is simply calling for the same clarity, fairness, and effectiveness to be reflected in Nigeria’s copyright system. ReLPI recognises and respects performers’ rights as provided under Nigerian law and applicable international conventions.”

ReLPI insisted that allocations attributable to sound recordings must be distributed through transparent, auditable, and sound recording owner-mandated mechanisms that inspire confidence across the industry. It further cautions against narratives that has historically pitted segments of the music industry against one another when the questions of transparency, accountability, and governance are raised.

“Allocations attributable to sound recordings must be distributed through transparent, auditable, and sound recording owner-mandated mechanisms that inspire confidence across the industry.

ReLPI cautions against a return to narratives that historically pitted segments of the music industry against one another whenever legitimate questions were raised about transparency, accountability, and governance.”

ReLPI insisted that its fight is for the establishment of a properly constituted, representative, and lawful collective management system for sound recording rights, in accordance with the Copyright Act, 2022, and international best practices. 

It would appear that the Nigerian Copyright Commission (NCC) has unequivocally thrown its weight behind Musical Collection Society of Nigeria (MCSN) by paying the first tranche of the copyright levy to its approved Collective Management Organisation despite ReLPI's objection and the provisions of Section 89 (3) of the Copyrights Act that allows organised representatives of right holders to receive the copyright levy on behalf of their members.

ReLPI’s objection and the current scrutiny of MCSN mandate and operation is the latest to rock the Nigerian music industry, where different interest groups have battled over the mandate to administer licenses and receive royalties in the country.

Even though MCSN has NCC’s approval and by extension statutory backing, the questions surrounding its establishment and mandate is not going away any time soon unless some cogent questions are addressed.

Among these questions is the determination of whether MCSN has the power to receive royalties for sound recordings, which goes to labels, especially as it was established as a body to receive performance royalties, which is of an entirely distinct nature from the sound recording royalties. NCC’s decision to ascribe the power to receive sound recording royalties to MCSN has created confusion where the CMO’s power now extends to an area its mandate shouldn’t cover.

Further, the questions of transparency, accountability, and governance that has plaqued MCSN will continue to arise unless the CMO carry along all stake holders by providing clarity on its finances, operations,  royalties sharing formular, the recipients of these royalties, and other disclosures that meets global operational standards for CMOs.

The controversy around the collection of music royalties in Nigeria is not lost on the Federal government, which recently called a high-level meeting involving the Minister of Art, Culture, Tourism, and Creative Economy, the Minister of Justice, the DGs of NCC and NCAC, and industry stakeholders to address the issues raised by RELPI.

While the engagement is still in its early days, it would appear that the government, for some reason, has elected to maintain the status quo by remitting the first tranche of the copyright levy to MCSN.

It's left to be seen whether these closed-door meetings will lead to clarity and reform of collective management and music royalties collection and distribution in Nigeria.

At any rate, stakeholders within the Nigerian music industry will be keenly following MCSN’s processes in the administration and distribution of the copyright levy.