What amendments does the Regulation on Collective Management Organizations introduce?

Pursuant to Presidential Decision No. 5405, the “Regulation on Collective Management Organizations” (“ Regulation ”) was published in Official Gazette No. 31802 dated 7 April 2022 and entered into force. The legal basis for the Regulation is Article 42 of the Law on Intellectual and Artistic Works (“ Copyright Law ”) No. 5846, titled “Creation of Collective Management Organizations.”

Recent development

In line with the publication of the Regulation in the Official Gazette dated 7 April 2022 and its entry into force, a presidential decision which repealed the “By-Law on Collective Management Organizations and Federations of Authors of Intellectual and Artistic Works and Related Right Holders” (“ By-Law ”) and “Type Status of Collective Management Organizations of Authors of Intellectual and Artistic Works and Related Right Holders” was published in the said Official Gazette. The Regulation, prepared to replace the aforementioned By-Law which sought reducing paperwork and adapting to technological developments, aims to make collective management organizations more effective and transparent in accordance with the changes made in the Copyright Law and other relevant legislation, national developments in the copyright system that will affect the functioning of collective management organizations and international developments, especially the EU Directive 2014/26/EU on “Collective Management of Copyright and Related Rights and Multi-Territorial Licensing of Rights in Musical Works for Online Use in the Internal Market.” The Regulation foresees the establishment and functioning of collective management organizations of authors, related right holders and book publishers, membership regimes, relationships between collective management organizations and their members and users, distribution of royalties and compensations and other procedures and principles. As one of the most important amendments introduced by the Regulation, the procedures and principles regarding the creation and functioning of the federations, which were not regulated under the By-Law in detail, are regulated thoroughly.

What are the main amendments introduced by the Regulation?

• Pursuant to Article 4 of the Regulation, authors, related right holders and book publishers may establish more than one professional association in the fields that the relevant article specifies, to protect their common interests, administer and follow-up the rights granted by the Copyright Law, collect compensation and royalties and distribute them to the right holders.
• Article 9 of the Regulation regulates the basic duties and authorities of collective management organizations, such as managing rights, collecting and distributing all kinds of fees related to these rights, creating a database for these rights and taking measures for these rights, including resorting to administrative, legal and criminal remedies when deemed necessary.
• Article 10 of the Regulation titled “Right to Become a Member and Obligations of a Member” regulates the conditions for membership of a collective management organization or maintaining this membership. Legal persons can also become members of collective management organizations if they are established in accordance with Turkish laws.
• The By-Law regulated that collective management organizations may affiliate beneficiary members and candidate members in addition to the original members. On the other hand, the Regulation does not literally include any type of membership, but states that different types of membership can be created based on the term of membership or the royalty income obtained from the collective management organization, provided that such practice is fair and proportionate. There will be no discrimination between different types of membership in terms of distribution of income and compensation, social activities, etc. Collective management organizations should maintain a fair and balanced attitude in cases where differentiation between membership types is allowed.
• Pursuant to Article 16 of the Regulation, collective management organizations are authorized to manage the rights within the framework of the authorization given under the legislation or the authorization certificate given by their members. The rights of the right holders arising from the Copyright Law cannot be managed by any organization other than the collective management organizations established in accordance with the Regulation. Collective management organizations are exclusively authorized to follow-up the rights of the right holders subject to the authorization certificate. In this context, collective management organizations are authorized and liable to use the rights subject to the authorization certificate on their own behalf, allow third parties to use it, prevent them from using it, collect the fee paid for the use and apply and pursue all kinds of accidental, administrative and executive means for the follow-up and collection of these rights. It is essential to determine the type and scope of each right subject to the authorization certificate in accordance with the criteria to be set by the relevant collective management organization.

• Mandatory bodies of collective management organizations are listed as follows:

1. General assembly
2. Board of directors
3. Supervisory board
4. Technical-scientific committee
5. Dignity board

Collective management organizations can also form optional bodies, but it is not possible to transfer the duties, powers and responsibilities of mandatory bodies to optional bodies.

• Article 40 of the Regulation foresees the procedures and principles regarding the payment of royalties collected by the collective management organization. Accordingly, royalties are paid after the collective management organization’s share is deducted whereas, compensation revenues are paid after the collection expenses and the collective management organization’s share are deducted as soon as possible and, provided that the payments do not exceed nine months from the end of the financial year in which they are collected, after the collection expenses and/or the collective management organization’s share are deducted.
• Pursuant to Article 60 of the Regulation titled “Creation of Federations,” at least two collective management organizations can establish a federation and more than one federation cannot be established at the same time in the same specialization. In the same article, the specializations for which a federation can be created are listed one by one.
• The Regulation covers the scope of the authorization certificate to be given by the right holders to the collective management organizations, relationships with users, complaint application processes, the annual transparency report and website obligations under the section titled “Miscellaneous” and in Article 53 and the following.
• Provisional Article 1 and Provisional Article 2 have been added to the Regulation to be implemented during the transition period from the By-Law to the Regulation. In accordance with Provisional Article 1, collective management organizations and federations created prior to the date that the Regulation entered into force will bring their statutes and other regulations regarding their operation into compliance with the provisions of the Regulation upon an extraordinary general assembly meeting to be held by 1 January 2023 at the latest. During this period, the activities collective management organizations and federations will be carried out in accordance with the provisions of the By-Law. On the other hand, Provisional Article 2 regulates that the ordinary general assembly meetings of collective management organizations and federations established before the Regulation came into force will be held in the month specified in their statutes and within the year that the first paragraph of Article 23 of the By-Law specifies.

Conclusion

The Regulation, which was published in Official Gazette No. 31802 dated 7 April 2022, introduces amendments to matters such as the creation and structure of collective management organizations, membership principles and distribution of royalties. The Regulation reregulated the conditions for membership and expulsion from membership, authorized the collective management organizations to determine membership types based on certain objective criteria and to regulate the right to elect and be elected according to these membership types and introduced provisions which oblige collective management organizations’ activities to be conducted in accordance with the principles of efficiency, participation, transparency and accountability. In addition, other matters such as the royalty distribution procedure, relationships between collective management organizations, users and other organizations, complaint processes, membership disputes, inspection and termination of collective management organizations have been reregulated considering both the relevant EU Directive and relevant domestic legislation.