Concept and Definition of the Rights Administration Agreement
Ein Rights Administration Agreement is a civil law contract by which one party (the rights assignor) transfers certain rights to copyrighted works or performances to another party (usually a collecting society or another representative body, the rights assignee) for fiduciary or personal administration. The purpose of the rights administration agreement is to ensure the efficient and consolidated exploitation, management, and enforcement of copyright or related rights. Such agreements are primarily used in the field of copyright and by collecting societies.
Legal Basis of the Rights Administration Agreement
Statutory Classification
The rights administration agreement is not explicitly regulated by the German Civil Code (BGB), so its specific form is mainly determined by the general provisions of the law of obligations as well as the relevant regulations of the Copyright Act (UrhG) and the Collecting Societies Act (VGG). Particularly, Sections 31 et seq. UrhG (granting of rights), the VGG, as well as supplementary statutes and individual agreements between the parties, shape the content and structure of the contractual relationship.
Contracting Parties
Typical parties to the contract are, on one side, authors, holders of related rights, or rightsholders (e.g., composers, writers, musicians, broadcasting organizations) and, on the other side, collecting societies (e.g., GEMA, VG Wort, VG Bild-Kunst) or other organizations entrusted with the management of rights.
Legal Nature
The rights administration agreement exhibits characteristics of a services supply contract and an agency agreement (Sections 662 et seq. BGB), but, due to its specific nature, is often classified as a so-called ‘atypical contract’. It may be structured as a continuing obligation, is generally intended for a longer duration, and is subject to the particularities of fiduciary administration and collective rights management.
Components and Content of the Rights Administration Agreement
Subject Matter of the Contract
The central subject of the contract is the transfer or granting of specific copyright exploitation rights and/or the commissioning of the enforcement of statutory remuneration claims. Frequently, the following rights are transferred:
- Right of reproduction
- Right of distribution
- Right of public performance
- Right of making available to the public
- Right to remuneration pursuant to Sections 27 et seq., Sections 54 et seq. UrhG (including equipment and blank media levies)
Rights and Duties of the Parties
Rights of the Rights Assignee
- Exercise and administration of the transferred rights in their own or in another’s name
- Enforcement of claims against third parties (e.g., users or infringers)
- Collection and distribution of license and remuneration payments
Duties of the Rights Assignee
- Proper and diligent management of the rights as well as transparent accounting for the collected remunerations
- Forwarding the collected amounts to the entitled parties according to established distribution schemes
- Reporting and informational obligations towards the rights assignor
Rights and Duties of the Rights Assignor
- Right to participate in remuneration proceeds according to their own repertoire and usage
- Duty to cooperate in rights clarification and, if applicable, to notify works or changes to works
Contract Duration and Termination
Rights administration agreements are usually concluded for an indefinite period. The legal provisions (Section 8 (1) VGG) require that termination must be possible no later than the end of one year after receipt of the notice of termination, unless otherwise contractually agreed. Special regulations apply with regard to post-contractual remuneration claims and concerning the termination of the contract and the retransfer of rights.
Special Features Regarding Collecting Societies
Collecting societies are subject to legal supervision (Section 19 VGG) and must, in particular, ensure that the interests of rights holders are protected. Rights administration agreements with collecting societies are subject to statutory transparency and information obligations (cf. Sections 32 et seq. VGG), as well as requirements for collective decision-making and distribution of income.
Legal Effects and Consequences of the Rights Administration Agreement
Binding Effect
By entering into a rights administration agreement, exclusive or non-exclusive rights management is established, i.e., the management of specific rights is assigned exclusively or jointly with other rights to the appointed entity. For exclusive rights management, the author is generally no longer authorized to exercise the rights themself or to appoint third parties for the term of the contract.
Effect Toward Third Parties
By the transfer of rights, the rights assignee acquires the authority to assert claims in their own name. Third parties, such as exploiters and users of the works, are obliged to contact the rights assignee directly regarding rights clearance.
Retransfer of Rights
Upon termination of the rights administration agreement, the transferred powers expire, unless a post-contractual effect or winding-up period has been contractually agreed. Exclusively transferred rights must be retransferred at the latest upon expiry of the contract.
Typical Fields of Application and Examples
Music and Literary Sectors
Authors and musicians regularly conclude rights administration agreements for collective rights management by collecting societies. The societies handle licensing to users (e.g., radio stations, streaming services) and distribute remuneration to the authors.
Image and Film Industry
Image authors and film producers also use rights administration agreements to represent themselves to third parties, particularly for the enforcement of rights to public performance or reproduction.
Academia and Education
Rights administration agreements are increasingly used in the field of academic publishing and in the collective exploitation of text and data mining rights.
Distinction from Other Types of Contracts
The rights administration agreement should not be confused with simple license agreements, in which only exploitation rights are granted, without the licensee assuming the task of collective or fiduciary enforcement and management. In contrast to a management or agency agreement, the rights administration agreement is characterized by a comprehensive transfer of rights and a specific fiduciary function.
Significance in Case Law and Practice
Rights administration agreements are of high relevance in case law and practice, particularly in the context of collective rights management. The agreements regularly concluded by collecting societies are subject to judicial review, especially with regard to the structure of remuneration regulations, the contract duration, and the retransfer of rights. Furthermore, the requirements for transparency and accounting obligations have been further clarified in recent years by legislative reforms.
Summary
The rights administration agreement is a key legal instrument for the efficient management, enforcement, and licensing of copyright and related rights. It creates the legal basis for collective rights management by organizations such as collecting societies and helps to balance the interests of rights holders, users, and exploiters. The legal framework ensures transparency, oversight, and fair remuneration for the legitimate rights holders.
Frequently Asked Questions
How does a rights administration agreement legally differ from a license agreement?
A rights administration agreement differs fundamentally from a license agreement in legal terms, as it is regularly concluded with a collecting society (e.g., GEMA, VG Wort) and not with an individual user. In a rights administration agreement, the rightsholder assigns certain exploitation rights to the collecting society for fiduciary management, usually in the form of exclusive exploitation powers. The society manages the rights in its own name and on its own account, settles claims in the event of unauthorized use, grants licenses, and distributes revenue to beneficiaries. In contrast, a license agreement exclusively regulates the relationship between the rightsholder (licensor) and the licensee; the exploitation right to a specific work is granted directly here. The rights administration agreement is also generally regulated by the Copyright Administration Act (UrhWahrnG), which provides for special requirements and rights for rights holders and collecting societies, whereas license agreements are essentially governed by general contract law and the Copyright Act.
Is the rights administration agreement subject to statutory form requirements?
The rights administration agreement is generally not subject to a written form requirement under the BGB; however, for reasons of legal certainty and on the basis of Section 6 (2) UrhWahrnG, collecting societies usually require written or textual form. This serves to clearly document the rights and obligations transferred. In practice, a precise listing of the affected rights (e.g., mechanical reproduction, public performance) and the applicable contractual terms is essential to avoid later disputes about scope, remuneration, and termination. Form requirements usually arise from the statutes of the respective collecting society, which, in the interest of transparency and verifiability, specify very precise requirements for concluding and amending contracts.
Which rights are typically transferred by a rights administration agreement?
When entering into a rights administration agreement, the collecting society is regularly assigned the exploitation rights and related rights intended for administration. This typically covers the right of reproduction, the right of distribution, the right of public performance, the broadcasting right, and the right of making available to the public. In some cases, further (possibly future) rights are transferred within the scope of a so-called rights bundle. The transfer of rights is often comprehensive (exclusive) to enable the society to effectively enforce and license the rights. Reservations and restrictions can be stipulated in supplemental agreements, for example, for the right holder’s personal use or for specific types of exploitation not to be administered.
What typical obligations does the rightsholder have within the framework of a rights administration agreement?
The rightsholder is especially obliged to provide complete and truthful information about all relevant works and rights to be administered. To ensure the proper distribution of remuneration, the entitled party must regularly report works, amendments, and relevant administrative actions to the collecting society in a timely manner. Furthermore, the rightsholder undertakes not to exercise the transferred rights independently outside of the contractual relationship and not to grant competing exploitation rights (exclusive commitment). There may also be an obligation to cooperate in legal enforcement or damage claims under the terms of the contract.
How is remuneration legally regulated in the rights administration agreement?
Remuneration is typically not determined directly in the individual rights administration agreement, but rather by tariffs and distribution plans established by the collecting society and negotiated with the relevant stakeholders. These distribution plans form part of the society’s statutes and regulate in detail how collected license fees, compensation, and other remuneration are distributed. The legal claim to payment depends largely on the correct and timely reporting of works and the fulfillment of contractual and statutory requirements by the rightsholder. Changes in tariffs or distribution plans are regularly coordinated within the framework of democratic decision-making by the collecting societies and communicated to the beneficiaries in good time.
Under what legal prerequisites can a rights administration agreement be terminated?
As a rule, the rights administration agreement provides for fixed notice periods and modalities, which are derived from the statutes of the respective collecting society. Often, ordinary termination is only possible at the end of a calendar year with a notice period of at least three to six months. Regardless, according to Section 6 UrhWahrnG, there is a right to extraordinary termination for good cause, for example in the event of serious breaches of duty by the society or significant changes to the legal framework. An effective withdrawal or partial termination of individual rights may require additional statutory requirements; the return of already licensed rights is usually excluded to safeguard existing usage relationships and the contractual fidelity of the society.
