What Are Neighbouring Rights?
Neighbouring rights are royalties earned and paid to performers and master rightsholders (labels, self-releasing artists etc.) when recorded music is publicly played or broadcast. This includes everything from a song being on the radio, TV, as well as background music in a restaurant, bar, or shop etc.
Similarly to how performance royalties are paid to songwriters when music is publicly performed, neighbouring rights ‘sit next to’ these royalties, but instead represent earnings from the master copyright (sound recording) rather than the compositional copyright (lyrics, melody, structure).
Who Collects Them?
Neighbouring rights are collected by CMOs, or Collective Management Organisations. In the UK, neighbouring rights are collected by PPL who then pay royalties to the relevant bodies (performers and master rightsholders).
Certain distributors (like Kycker) also collect some neighbouring rights which will then be paid as part of your earnings alongside streaming royalties.
How Do You Get Your Neighbouring Rights
To receive neighbouring rights, you need to make sure that you’ve signed up to a CMO in the country that you are based in. As mentioned, in the UK, PPL collect neighbouring rights. Sign up is free and then you will have to register all of your songs correctly (including metadata and all performers/master rightsholders).
Although, it’s important to remember that rules vary for US artists…
How Do Neighbouring Rights Work Internationally?
Neighbouring rights have different laws and regulations in different countries. For example, in the US, neighbouring rights are not recognised and therefore royalties are limited to non-interactive digital streams like Pandora, SiriusXM, and not generating earnings via traditional AF/FM radio and plays in public venues.
This means that US artists are at risk of missing out on royalties collected internationally, unless they work with a rights management company that has reciprocal agreements with societies in countries that recognise all neighbouring rights.
What Happens If You Don’t Collect Your Neighbouring Rights?
For many reasons, neighbouring rights often fail to be collected and paid to rightsholders. If so, these earnings go into something called the ‘black box’. Held by collection societies, the black box refers to large pool of royalties that are currently unclaimed and therefore can’t be allocated to the correct rightsholders due to missing or incorrect data.
It’s important to remember that this doesn’t only affect neighbouring rights, but also applies to performance, mechanical and streaming royalties, and means that artists are often missing out on significant earnings rightfully owed to them.
