MUSIC MODERNIZATION ACT; Congressional Record Vol. 164, No. 67
(House of Representatives - April 25, 2018)

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[Pages H3522-H3542]
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                        MUSIC MODERNIZATION ACT

  Mr. GOODLATTE. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 5447) to modernize copyright law, and for other purposes, as 
amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 5447

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Music 
     Modernization Act''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Rescission Of Unobligated Balances In The Department Of Justice 
              Assets Forfeiture Fund.

                 TITLE I--MUSIC LICENSING MODERNIZATION

Sec. 101. Short title.
Sec. 102. Blanket license for digital uses and mechanical licensing 
              collective.
Sec. 103. Amendments to section 114.
Sec. 104. Random assignment of rate court proceedings.

  TITLE II--COMPENSATING LEGACY ARTISTS FOR THEIR SONGS, SERVICE, AND 
                   IMPORTANT CONTRIBUTIONS TO SOCIETY

Sec. 201. Short title.
Sec. 202. Unauthorized digital performance of pre-1972 sound 
              recordings.
Sec. 203. Effective date.

               TITLE III--ALLOCATION FOR MUSIC PRODUCERS

Sec. 301. Short title.
Sec. 302. Payment of statutory performance royalties.
Sec. 303. Effective date.

     SEC. 2. RESCISSION OF UNOBLIGATED BALANCES IN THE DEPARTMENT 
                   OF JUSTICE ASSETS FORFEITURE FUND.

       Of the unobligated balances available under the Department 
     of Justice Assets Forfeiture Fund, $47,000,000 is hereby 
     permanently rescinded.

                 TITLE I--MUSIC LICENSING MODERNIZATION

     SEC. 101. SHORT TITLE.

       This title may be cited as the ``Musical Works 
     Modernization Act''.

     SEC. 102. BLANKET LICENSE FOR DIGITAL USES AND MECHANICAL 
                   LICENSING COLLECTIVE.

       (a) Amendment.--Section 115 of title 17, United States 
     Code, is amended--
       (1) in subsection (a)--
       (A) by inserting ``in General'' after ``Availability and 
     Scope of Compulsory License'';
       (B) by striking paragraph (1) and inserting the following 
     new paragraph:
       ``(1) Eligibility for compulsory license.--
       ``(A) Conditions for compulsory license.--A person may by 
     complying with the provisions of this section obtain a 
     compulsory license to make and distribute phonorecords of a 
     nondramatic musical work, including by means of digital 
     phonorecord delivery. A person may obtain a compulsory 
     license only if the primary purpose in making phonorecords of 
     the musical work is to distribute them to the public for 
     private use, including by means of digital phonorecord 
     delivery, and--
       ``(i) phonorecords of such musical work have previously 
     been distributed to the public in the United States under the 
     authority of the copyright owner of the work, including by 
     means of digital phonorecord delivery; or
       ``(ii) in the case of a digital music provider seeking to 
     make and distribute digital phonorecord deliveries of a sound 
     recording embodying a musical work under a compulsory license 
     for which clause (i) does not apply--

       ``(I) the first fixation of such sound recording was made 
     under the authority of the musical work copyright owner, and 
     sound recording copyright owner has the authority of the 
     musical work copyright owner to make and distribute digital 
     phonorecord deliveries embodying such work to the public in 
     the United States; and
       ``(II) the sound recording copyright owner or its 
     authorized distributor has authorized the digital music 
     provider to make and distribute digital phonorecord 
     deliveries of the sound recording to the public in the United 
     States.

       ``(B) Duplication of sound recording.--A person may not 
     obtain a compulsory license for the use of the work in the 
     making of phonorecords duplicating a sound recording fixed by 
     another, including by means of digital phonorecord delivery, 
     unless--
       ``(i) such sound recording was fixed lawfully; and
       ``(ii) the making of the phonorecords was authorized by the 
     owner of the copyright in the sound recording or, if the 
     sound recording was fixed before February 15, 1972, by any 
     person who fixed the sound recording pursuant to an express 
     license from the owner of the copyright in the musical work 
     or pursuant to a valid compulsory license for use of such 
     work in a sound recording.''; and
       (C) in paragraph (2), by striking ``A compulsory license'' 
     and inserting ``Musical arrangement.--A compulsory license'';
       (2) by striking subsection (b) and inserting the following:
       ``(b) Procedures To Obtain a Compulsory License.--
       ``(1) Phonorecords other than digital phonorecord 
     deliveries.--A person who seeks to obtain a compulsory 
     license under subsection (a) to make and distribute 
     phonorecords of a musical work other than by means of digital 
     phonorecord delivery shall, before or within 30 calendar days 
     after making, and before distributing, any phonorecord of the 
     work, serve notice of intention to do so on the copyright 
     owner. If the registration or other public records of the 
     Copyright Office do not identify the copyright owner and 
     include an address at which notice can be served, it shall be 
     sufficient to file the notice of intention with the Copyright 
     Office. The notice shall comply, in form, content, and manner 
     of service, with requirements that the Register of Copyrights 
     shall prescribe by regulation.
       ``(2) Digital phonorecord deliveries.--A person who seeks 
     to obtain a compulsory license under subsection (a) to make 
     and distribute phonorecords of a musical work by means of 
     digital phonorecord delivery--
       ``(A) prior to the license availability date, shall, before 
     or within 30 calendar days after first making any such 
     digital phonorecord delivery, serve a notice of intention to 
     do so on the copyright owner (but may not file the notice 
     with the Copyright Office, even if the public records of the 
     Office do not identify the owner or the owner's address), and 
     such notice shall comply, in form, content, and manner of 
     service, with requirements that the Register of Copyrights 
     shall prescribe by regulation; or
       ``(B) on or after the license availability date, shall, 
     before making any such digital phonorecord delivery, follow 
     the procedure described in subsection (d)(2), except as 
     provided in paragraph (3).
       ``(3) Record company individual download licenses.--
     Notwithstanding paragraph (2)(B), a record company may, on or 
     after the license availability date, obtain an individual 
     download license in accordance with the notice requirements 
     described in paragraph (2)(A) (except for the requirement 
     that notice occur prior to the license availability date). A 
     record company that obtains an individual download license as 
     permitted under this paragraph shall provide statements of 
     account and pay royalties as provided in subsection 
     (c)(2)(I).
       ``(4) Failure to obtain license.--
       ``(A) Phonorecords other than digital phonorecord 
     deliveries.--In the case of phonorecords made and distributed 
     other than by means of digital phonorecord delivery, the 
     failure to serve or file the notice of intention required by 
     paragraph (1) forecloses the possibility of a compulsory 
     license under paragraph (1). In the absence of a voluntary 
     license, the failure to obtain a compulsory license renders 
     the making and distribution of phonorecords actionable as 
     acts of infringement under section 501 and subject to the 
     remedies provided by sections 502 through 506.
       ``(B) Digital phonorecord deliveries.--
       ``(i) In the case of phonorecords made and distributed by 
     means of digital phonorecord delivery:

       ``(I) The failure to serve the notice of intention required 
     by paragraph (2)(A) or paragraph (3), as applicable, 
     forecloses the possibility of a compulsory license under such 
     paragraph.
       ``(II) The failure to comply with paragraph (2)(B) 
     forecloses the possibility of a blanket license for a period 
     of 3 years after the last calendar day on which the notice of 
     license was required to be submitted to the mechanical 
     licensing collective under such paragraph.

       ``(ii) In either case described in clause (i), in the 
     absence of a voluntary license, the failure to obtain a 
     compulsory license renders the making and distribution of 
     phonorecords by means of digital phonorecord delivery 
     actionable as acts of infringement under section 501 and 
     subject to the remedies provided by sections 502 through 
     506.'';
       (3) by amending subsection (c) to read as follows:
       ``(c) General Conditions Applicable to Compulsory 
     License.--
       ``(1) Royalty payable under compulsory license.--
       ``(A) Identification requirement.--To be entitled to 
     receive royalties under a compulsory license obtained under 
     subsection (b)(1) the copyright owner must be identified in 
     the registration or other public records of the Copyright 
     Office. The owner is entitled to royalties for phonorecords 
     made and distributed after being so identified, but is not 
     entitled to recover for any phonorecords previously made and 
     distributed.
       ``(B) Royalty for phonorecords other than digital 
     phonorecord deliveries.--Except as provided by subparagraph 
     (A), for every phonorecord made and distributed under a 
     compulsory license under subsection (a) other than by means 
     of digital phonorecord delivery, with respect to each work 
     embodied in the phonorecord, the royalty shall be the royalty 
     prescribed under subparagraphs (D) through (F) and paragraph 
     (2)(A) and chapter 8 of this title. For purposes of this 
     subparagraph, a phonorecord is considered `distributed' if 
     the person exercising the compulsory license has voluntarily 
     and permanently parted with its possession.
       ``(C) Royalty for digital phonorecord deliveries.--For 
     every digital phonorecord delivery of a musical work made 
     under a

[[Page H3523]]

     compulsory license under this section, the royalty payable 
     shall be the royalty prescribed under subparagraphs (D) 
     through (F) and paragraph (2)(A) and chapter 8 of this title.
       ``(D) Authority to negotiate.--Notwithstanding any 
     provision of the antitrust laws, any copyright owners of 
     nondramatic musical works and any persons entitled to obtain 
     a compulsory license under subsection (a) may negotiate and 
     agree upon the terms and rates of royalty payments under this 
     section and the proportionate division of fees paid among 
     copyright owners, and may designate common agents on a 
     nonexclusive basis to negotiate, agree to, pay or receive 
     such royalty payments. Such authority to negotiate the terms 
     and rates of royalty payments includes, but is not limited 
     to, the authority to negotiate the year during which the 
     royalty rates prescribed under this subparagraph and 
     subparagraphs (E) and (F) and paragraph (2)(A) and chapter 8 
     of this title shall next be determined.
       ``(E) Determination of reasonable rates and terms.--
     Proceedings under chapter 8 shall determine reasonable rates 
     and terms of royalty payments for the activities specified by 
     this section during the period beginning with the effective 
     date of such rates and terms, but not earlier than January 1 
     of the second year following the year in which the petition 
     requesting the proceeding is filed, and ending on the 
     effective date of successor rates and terms, or such other 
     period as the parties may agree. Any copyright owners of 
     nondramatic musical works and any persons entitled to obtain 
     a compulsory license under subsection (a) may submit to the 
     Copyright Royalty Judges licenses covering such activities. 
     The parties to each proceeding shall bear their own costs.
       ``(F) Schedule of reasonable rates.--The schedule of 
     reasonable rates and terms determined by the Copyright 
     Royalty Judges shall, subject to paragraph (2)(A), be binding 
     on all copyright owners of nondramatic musical works and 
     persons entitled to obtain a compulsory license under 
     subsection (a) during the period specified in subparagraph 
     (E), such other period as may be determined pursuant to 
     subparagraphs (D) and (E), or such other period as the 
     parties may agree. The Copyright Royalty Judges shall 
     establish rates and terms that most clearly represent the 
     rates and terms that would have been negotiated in the 
     marketplace between a willing buyer and a willing seller. In 
     determining such rates and terms for digital phonorecord 
     deliveries, the Copyright Royalty Judges shall base their 
     decision on economic, competitive, and programming 
     information presented by the parties, including--
       ``(i) whether use of the compulsory licensee's service may 
     substitute for or may promote the sales of phonorecords or 
     otherwise may interfere with or may enhance the musical work 
     copyright owner's other streams of revenue from its musical 
     works; and
       ``(ii) the relative roles of the copyright owner and the 
     compulsory licensee in the copyrighted work and the service 
     made available to the public with respect to the relative 
     creative contribution, technological contribution, capital 
     investment, cost, and risk.
       ``(2) Additional terms and conditions.--
       ``(A) Voluntary licenses and contractual royalty rates.--
       ``(i) License agreements voluntarily negotiated at any time 
     between one or more copyright owners of nondramatic musical 
     works and one or more persons entitled to obtain a compulsory 
     license under subsection (a) shall be given effect in lieu of 
     any determination by the Copyright Royalty Judges. Subject to 
     clause (ii), the royalty rates determined pursuant to 
     subparagraphs (E) and (F) of paragraph (1) shall be given 
     effect as to digital phonorecord deliveries in lieu of any 
     contrary royalty rates specified in a contract pursuant to 
     which a recording artist who is the author of a nondramatic 
     musical work grants a license under that person's exclusive 
     rights in the musical work under paragraphs (1) and (3) of 
     section 106 or commits another person to grant a license in 
     that musical work under paragraphs (1) and (3) of section 
     106, to a person desiring to fix in a tangible medium of 
     expression a sound recording embodying the musical work.
       ``(ii) The second sentence of clause (i) shall not apply 
     to--

       ``(I) a contract entered into on or before June 22, 1995, 
     and not modified thereafter for the purpose of reducing the 
     royalty rates determined pursuant to subparagraphs (E) and 
     (F) of paragraph (1) or of increasing the number of musical 
     works within the scope of the contract covered by the reduced 
     rates, except if a contract entered into on or before June 
     22, 1995, is modified thereafter for the purpose of 
     increasing the number of musical works within the scope of 
     the contract, any contrary royalty rates specified in the 
     contract shall be given effect in lieu of royalty rates 
     determined pursuant to subparagraphs (E) and (F) of paragraph 
     (1) for the number of musical works within the scope of the 
     contract as of June 22, 1995; and
       ``(II) a contract entered into after the date that the 
     sound recording is fixed in a tangible medium of expression 
     substantially in a form intended for commercial release, if 
     at the time the contract is entered into, the recording 
     artist retains the right to grant licenses as to the musical 
     work under paragraphs (1) and (3) of section 106.

       ``(B) Sound recording information.--Except as provided in 
     section 1002(e) of this title, a digital phonorecord delivery 
     licensed under this paragraph shall be accompanied by the 
     information encoded in the sound recording, if any, by or 
     under the authority of the copyright owner of that sound 
     recording, that identifies the title of the sound recording, 
     the featured recording artist who performs on the sound 
     recording, and related information, including information 
     concerning the underlying musical work and its writer.
       ``(C) Infringement remedies.--
       ``(i) A digital phonorecord delivery of a sound recording 
     is actionable as an act of infringement under section 501, 
     and is fully subject to the remedies provided by sections 502 
     through 506, unless--

       ``(I) the digital phonorecord delivery has been authorized 
     by the sound recording copyright owner; and
       ``(II) the entity making the digital phonorecord delivery 
     has obtained a compulsory license under subsection (a) or has 
     otherwise been authorized by the musical work copyright 
     owner, or by a record company pursuant to an individual 
     download license, to make and distribute phonorecords of each 
     musical work embodied in the sound recording by means of 
     digital phonorecord delivery.

       ``(ii) Any cause of action under this subparagraph shall be 
     in addition to those available to the owner of the copyright 
     in the nondramatic musical work under subparagraph (J) and 
     section 106(4) and the owner of the copyright in the sound 
     recording under section 106(6).
       ``(D) Liability of sound recording owners.--The liability 
     of the copyright owner of a sound recording for infringement 
     of the copyright in a nondramatic musical work embodied in 
     the sound recording shall be determined in accordance with 
     applicable law, except that the owner of a copyright in a 
     sound recording shall not be liable for a digital phonorecord 
     delivery by a third party if the owner of the copyright in 
     the sound recording does not license the distribution of a 
     phonorecord of the nondramatic musical work.
       ``(E) Recording devices and media.--Nothing in section 1008 
     shall be construed to prevent the exercise of the rights and 
     remedies allowed by this paragraph, subparagraph (J), and 
     chapter 5 in the event of a digital phonorecord delivery, 
     except that no action alleging infringement of copyright may 
     be brought under this title against a manufacturer, importer 
     or distributor of a digital audio recording device, a digital 
     audio recording medium, an analog recording device, or an 
     analog recording medium, or against a consumer, based on the 
     actions described in such section.
       ``(F) Preservation of rights.--Nothing in this section 
     annuls or limits (i) the exclusive right to publicly perform 
     a sound recording or the musical work embodied therein, 
     including by means of a digital transmission, under sections 
     106(4) and 106(6), (ii) except for compulsory licensing under 
     the conditions specified by this section, the exclusive 
     rights to reproduce and distribute the sound recording and 
     the musical work embodied therein under sections 106(1) and 
     106(3), including by means of a digital phonorecord delivery, 
     or (iii) any other rights under any other provision of 
     section 106, or remedies available under this title, as such 
     rights or remedies exist either before or after the date of 
     enactment of the Digital Performance Right in Sound 
     Recordings Act of 1995.
       ``(G) Exempt transmissions and retransmissions.--The 
     provisions of this section concerning digital phonorecord 
     deliveries shall not apply to any exempt transmissions or 
     retransmissions under section 114(d)(1). The exemptions 
     created in section 114(d)(1) do not expand or reduce the 
     rights of copyright owners under section 106(1) through (5) 
     with respect to such transmissions and retransmissions.
       ``(H) Distribution by rental, lease, or lending.--A 
     compulsory license obtained under subsection (b)(1) to make 
     and distribute phonorecords includes the right of the maker 
     of such a phonorecord to distribute or authorize distribution 
     of such phonorecord, other than by means of a digital 
     phonorecord delivery, by rental, lease, or lending (or by 
     acts or practices in the nature of rental, lease, or 
     lending). With respect to each nondramatic musical work 
     embodied in the phonorecord, the royalty shall be a 
     proportion of the revenue received by the compulsory licensee 
     from every such act of distribution of the phonorecord under 
     this clause equal to the proportion of the revenue received 
     by the compulsory licensee from distribution of the 
     phonorecord under subsection (a)(1)(A)(ii)(II) that is 
     payable by a compulsory licensee under that clause and under 
     chapter 8. The Register of Copyrights shall issue regulations 
     to carry out the purpose of this clause.
       ``(I) Payment of royalties and statements of account.--
     Except as provided in paragraphs (4)(A)(i) and (10)(B) of 
     subsection (d), royalty payments shall be made on or before 
     the twentieth day of each month and shall include all 
     royalties for the month next preceding. Each monthly payment 
     shall be made under oath and shall comply with requirements 
     that the Register of Copyrights shall prescribe by 
     regulation. The Register shall also prescribe regulations 
     under which detailed cumulative annual statements of account, 
     certified by a certified public accountant, shall be filed 
     for every compulsory license under subsection (a). The 
     regulations covering both the monthly and the annual 
     statements of account shall prescribe the form, content, and 
     manner of certification with respect to the number of records 
     made and the number of records distributed.

[[Page H3524]]

       ``(J) Notice of default and termination of compulsory 
     license.--In the case of a license obtained under subsection 
     (b)(1), (b)(2)(A), or (b)(3), if the copyright owner does not 
     receive the monthly payment and the monthly and annual 
     statements of account when due, the owner may give written 
     notice to the licensee that, unless the default is remedied 
     within thirty days from the date of the notice, the 
     compulsory license will be automatically terminated. Such 
     termination renders either the making or the distribution, or 
     both, of all phonorecords for which the royalty has not been 
     paid, actionable as acts of infringement under section 501 
     and fully subject to the remedies provided by sections 502 
     through 506. In the case of a license obtained under 
     subsection (b)(2)(B), license authority under the compulsory 
     license may be terminated as provided in subsection 
     (d)(4)(E).'';
       (4) by amending subsection (d) to read as follows:
       ``(d) Blanket License for Digital Uses, Mechanical 
     Licensing Collective, and Digital Licensee Coordinator.--
       ``(1) Blanket license for digital uses.--
       ``(A) In general.--A digital music provider that qualifies 
     for a compulsory license under subsection (a) may, by 
     complying with the terms and conditions of this subsection, 
     obtain a blanket license from copyright owners through the 
     mechanical licensing collective to make and distribute 
     digital phonorecord deliveries of musical works through one 
     or more covered activities.
       ``(B) Included activities.--A blanket license--
       ``(i) covers all musical works (or shares of such works) 
     available for compulsory licensing under this section for 
     purposes of engaging in covered activities, except as 
     provided in subparagraph (C);
       ``(ii) includes the making and distribution of server, 
     intermediate, archival, and incidental reproductions of 
     musical works that are reasonable and necessary for the 
     digital music provider to engage in covered activities 
     licensed under this subsection, solely for the purpose of 
     engaging in such covered activities; and
       ``(iii) does not cover or include any rights or uses other 
     than those described in clauses (i) and (ii).
       ``(C) Other licenses.--A voluntary license for covered 
     activities entered into by or under the authority of one or 
     more copyright owners and one or more digital music 
     providers, or authority to make and distribute permanent 
     downloads of a musical work obtained by a digital music 
     provider from a sound recording copyright owner pursuant to 
     an individual download license, shall be given effect in lieu 
     of a blanket license under this subsection with respect to 
     the musical works (or shares thereof) covered by such 
     voluntary license or individual download authority and the 
     following conditions apply:
       ``(i) Where a voluntary license or individual download 
     license applies, the license authority provided under the 
     blanket license shall exclude any musical works (or shares 
     thereof) subject to the voluntary license or individual 
     download license.
       ``(ii) An entity engaged in covered activities under a 
     voluntary license or authority obtained pursuant to an 
     individual download license that is a significant nonblanket 
     licensee shall comply with paragraph (6)(A).
       ``(iii) The rates and terms of any voluntary license shall 
     be subject to the second sentence of clause (i) and clause 
     (ii) of subsection (c)(2)(A) and paragraph (9)(C), as 
     applicable.
       ``(D) Protection against infringement actions.--A digital 
     music provider that obtains and complies with the terms of a 
     valid blanket license under this subsection shall not be 
     subject to an action for infringement of the exclusive rights 
     provided by paragraphs (1) and (3) of section 106 under this 
     title arising from use of a musical work (or share thereof) 
     to engage in covered activities authorized by such license, 
     subject to paragraph (4)(E).
       ``(E) Other requirements and conditions apply.--Except as 
     expressly provided in this subsection, each requirement, 
     limitation, condition, privilege, right, and remedy otherwise 
     applicable to compulsory licenses under this section shall 
     apply to compulsory blanket licenses under this subsection.
       ``(2) Availability of blanket license.--
       ``(A) Procedure for obtaining license.--A digital music 
     provider may obtain a blanket license by submitting a notice 
     of license to the mechanical licensing collective that 
     specifies the particular covered activities in which the 
     digital music provider seeks to engage, as follows:
       ``(i) The notice of license shall comply in form and 
     substance with requirements that the Register of Copyrights 
     shall establish by regulation.
       ``(ii) Unless rejected in writing by the mechanical 
     licensing collective within 30 calendar days after receipt, 
     the blanket license shall be effective as of the date the 
     notice of license was sent by the digital music provider as 
     shown by a physical or electronic record.
       ``(iii) A notice of license may only be rejected by the 
     mechanical licensing collective if--

       ``(I) the digital music provider or notice of license does 
     not meet the requirements of this section or applicable 
     regulations, in which case the requirements at issue shall be 
     specified with reasonable particularity in the notice of 
     rejection; or
       ``(II) the digital music provider has had a blanket license 
     terminated by the mechanical licensing collective within the 
     past 3 years pursuant to paragraph (4)(E).

       ``(iv) If a notice of license is rejected under clause 
     (iii)(I), the digital music provider shall have 30 calendar 
     days after receipt of the notice of rejection to cure any 
     deficiency and submit an amended notice of license to the 
     mechanical licensing collective. If the deficiency has been 
     cured, the mechanical licensing collective shall so confirm 
     in writing, and the license shall be effective as of the date 
     that the original notice of license was provided by the 
     digital music provider.
       ``(v) A digital music provider that believes a notice of 
     license was improperly rejected by the mechanical licensing 
     collective may seek review of such rejection in Federal 
     district court. The district court shall determine the matter 
     de novo based on the record before the mechanical licensing 
     collective and any additional evidence presented by the 
     parties.
       ``(B) Blanket license effective date.--Blanket licenses 
     shall be made available by the mechanical licensing 
     collective on and after the license availability date. No 
     such license shall be effective prior to the license 
     availability date.
       ``(3) Mechanical licensing collective.--
       ``(A) In general.--The mechanical licensing collective 
     shall be a single entity that--
       ``(i) is a nonprofit, not owned by any other entity, that 
     is created by copyright owners to carry out responsibilities 
     under this subsection;
       ``(ii) is endorsed by and enjoys substantial support from 
     musical work copyright owners that together represent the 
     greatest percentage of the licensor market for uses of such 
     works in covered activities, as measured over the preceding 3 
     full calendar years;
       ``(iii) is able to demonstrate to the Register of 
     Copyrights that it has, or will have prior to the license 
     availability date, the administrative and technological 
     capabilities to perform the required functions of the 
     mechanical licensing collective under this subsection; and
       ``(iv) has been designated by the Register of Copyrights in 
     accordance with subparagraph (B).
       ``(B) Designation of mechanical licensing collective.--
       ``(i) Initial designation.--The Register of Copyrights 
     shall initially designate the mechanical licensing collective 
     within 9 months after the enactment date as follows:

       ``(I) Within 90 calendar days after the enactment date, the 
     Register shall publish notice in the Federal Register 
     soliciting information to assist in identifying the 
     appropriate entity to serve as the mechanical licensing 
     collective, including the name and affiliation of each member 
     of the board of directors described under subparagraph (D)(i) 
     and each committee established pursuant to clauses (iii), 
     (iv), and (v) of subparagraph (D).
       ``(II) After reviewing the information requested under 
     subclause (I) and making a designation, the Register shall 
     publish notice in the Federal Register setting forth the 
     identity of and contact information for the mechanical 
     licensing collective.

       ``(ii) Periodic review of designation.--Following the 
     initial designation of the mechanical licensing collective, 
     the Register shall, every 5 years, beginning with the fifth 
     full calendar year to commence after the initial designation, 
     publish notice in the Federal Register in the month of 
     January soliciting information concerning whether the 
     existing designation should be continued, or a different 
     entity meeting the criteria described in clauses (i) through 
     (iii) of subparagraph (A) shall be designated. Following 
     publication of such notice:

       ``(I) The Register shall, after reviewing the information 
     submitted and conducting additional proceedings as 
     appropriate, publish notice in the Federal Register of a 
     continuing designation or new designation of the mechanical 
     licensing collective, as the case may be, with any new 
     designation to be effective as of the first day of a month 
     that is no less than 6 months and no longer than 9 months 
     after the date of publication of such notice, as specified by 
     the Register.
       ``(II) If a new entity is designated as a mechanical 
     licensing collective, the Register shall adopt regulations to 
     govern the transfer of licenses, funds, records, data, and 
     administrative responsibilities from the existing mechanical 
     licensing collective to the new entity.

       ``(iii) Closest alternative designation.--If the Register 
     is unable to identify an entity that fulfills each of the 
     qualifications set forth in clauses (i) through (iii) of 
     subparagraph (A), the Register shall designate the entity 
     that most nearly fulfills such qualifications for purposes of 
     carrying out the responsibilities of the mechanical licensing 
     collective.
       ``(C) Authorities and functions.--
       ``(i) In general.--The mechanical licensing collective is 
     authorized to perform the following functions, subject to 
     more particular requirements as described in this subsection:

       ``(I) Offer and administer blanket licenses, including 
     receipt of notices of license and reports of usage from 
     digital music providers.
       ``(II) Collect and distribute royalties from digital music 
     providers for covered activities.
       ``(III) Engage in efforts to identify musical works (and 
     shares of such works) embodied in particular sound 
     recordings, and to identify and locate the copyright owners 
     of such musical works (and shares of such works).

[[Page H3525]]

       ``(IV) Maintain the musical works database and other 
     information relevant to the administration of licensing 
     activities under this section.
       ``(V) Administer a process by which copyright owners can 
     claim ownership of musical works (and shares of such works), 
     and a process by which royalties for works for which the 
     owner is not identified or located are equitably distributed 
     to known copyright owners.
       ``(VI) Administer collections of the administrative 
     assessment from digital music providers and significant 
     nonblanket licensees, including receipt of notices of 
     nonblanket activity.
       ``(VII) Invest in relevant resources, and arrange for 
     services of outside vendors and others, to support its 
     activities.
       ``(VIII) Engage in legal and other efforts to enforce 
     rights and obligations under this subsection, including by 
     filing bankruptcy proofs of claims for amounts owed under 
     licenses, and acting in coordination with the digital 
     licensee coordinator..
       ``(IX) Initiate and participate in proceedings before the 
     Copyright Royalty Judges to establish the administrative 
     assessment under this subsection.
       ``(X) Initiate and participate in proceedings before the 
     Copyright Office with respect to activities under this 
     subsection.
       ``(XI) Gather and provide documentation for use in 
     proceedings before the Copyright Royalty Judges to set rates 
     and terms under this section.
       ``(XII) Maintain records of its activities and engage in 
     and respond to audits described under this subsection.
       ``(XIII) Engage in such other activities as may be 
     necessary or appropriate to fulfill its responsibilities 
     under this subsection.

       ``(ii) Additional administrative activities.--Subject to 
     paragraph (11)(C) and clause (iii), the mechanical licensing 
     collective may also administer, or assist in administering, 
     voluntary licenses issued by or individual download licenses 
     obtained from copyright owners for uses of musical works, for 
     which the mechanical licensing collective shall charge 
     reasonable fees for such services.
       ``(iii) Restriction concerning public performance rights.--
     The mechanical licensing collective may, pursuant to clause 
     (ii), provide administration services with respect to 
     voluntary licenses that include the right of public 
     performance in musical works, but may not itself negotiate or 
     grant licenses for the right of public performance in musical 
     works, and may not be the exclusive or nonexclusive assignee 
     or grantee of the right of public performance in musical 
     works.
       ``(iv) Restriction on lobbying.--The mechanical licensing 
     collective may not engage in government lobbying activities, 
     but may engage in the activities described in subclauses 
     (IX), (X), and (XI) of clause (i).
       ``(D) Governance.--
       ``(i) Board of directors.--The mechanical licensing 
     collective shall have a board of directors consisting of 14 
     voting members and 3 nonvoting members, as follows:

       ``(I) Ten voting members shall be representatives of music 
     publishers to which songwriters have assigned exclusive 
     rights of reproduction and distribution of musical works with 
     respect to covered activities and no such music publisher 
     member may be owned by, or under common control with, any 
     other board member.
       ``(II) Four voting members shall be professional 
     songwriters who have retained and exercise exclusive rights 
     of reproduction and distribution with respect to covered 
     activities with respect to musical works they have authored.
       ``(III) One nonvoting member shall be a representative of 
     the nonprofit trade association of music publishers that 
     represents the greatest percentage of the licensor market for 
     uses of musical works in covered activities, as measured over 
     the preceding 3 full calendar years.
       ``(IV) One nonvoting member shall be a representative of 
     the digital licensee coordinator, provided that a digital 
     licensee coordinator has been designated pursuant to 
     paragraph (5)(B). Otherwise, the nonvoting member shall be 
     the nonprofit trade association of digital licensees that 
     represents the greatest percentage of the licensee market for 
     uses of musical works in covered activities, as measured over 
     the preceding 3 full calendar years.
       ``(V) One nonvoting member shall be a representative of a 
     nationally recognized nonprofit trade association whose 
     primary mission is advocacy on behalf of songwriters in the 
     United States.

       ``(ii) Board meetings.--The board of directors shall meet 
     no less than 2 times per year and discuss matters pertinent 
     to the operations, including the mechanical licensing 
     collective budget.
       ``(iii) Operations advisory committee.--The board of 
     directors of the mechanical licensing collective shall 
     establish an operations advisory committee consisting of no 
     fewer than 6 members to make recommendations to the board of 
     directors concerning the operations of the mechanical 
     licensing collective, including the efficient investment in 
     and deployment of information technology and data resources. 
     Such committee shall have an equal number of members of the 
     committee who are--

       ``(I) musical work copyright owners who are appointed by 
     the board of directors of the mechanical licensing 
     collective; and
       ``(II) representatives of digital music providers who are 
     appointed by the digital licensee coordinator.

       ``(iv) Unclaimed royalties oversight committee.--The board 
     of directors of the mechanical licensing collective shall 
     establish and appoint an unclaimed royalties oversight 
     committee consisting of 10 members, 5 of which shall be 
     musical work copyright owners and 5 of which shall be 
     professional songwriters whose works are used in covered 
     activities.
       ``(v) Dispute resolution committee.--The board of directors 
     of the mechanical licensing collective shall establish and 
     appoint a dispute resolution committee consisting of no fewer 
     than 6 members, which committee shall include an equal number 
     of representatives of musical work copyright owners and 
     professional songwriters.
       ``(vi) Mechanical licensing collective annual report.--Not 
     later than June 30 of each year commencing after the license 
     availability date, the mechanical licensing collective shall 
     post, and make available online for a period of at least 3 
     years, an annual report that sets forth how the collective 
     operates, how royalties are collected and distributed, and 
     the collective total costs for the preceding calendar year. 
     At the time of posting, a copy of the report shall be 
     provided to the Register of Copyrights.
       ``(E) Musical works database.--
       ``(i) Establishment and maintenance of database.--The 
     mechanical licensing collective shall establish and maintain 
     a database containing information relating to musical works 
     (and shares of such works) and, to the extent known, the 
     identity and location of the copyright owners of such works 
     (and shares thereof) and the sound recordings in which the 
     musical works are embodied. In furtherance of maintaining 
     such database, the mechanical licensing collective shall 
     engage in efforts to identify the musical works embodied in 
     particular sound recordings, as well as to identify and 
     locate the copyright owners of such works (and shares 
     thereof), and update such data as appropriate.
       ``(ii) Matched works.--With respect to musical works (and 
     shares thereof) that have been matched to copyright owners, 
     the musical works database shall include--

       ``(I) the title of the musical work;
       ``(II) the copyright owner of the work (or share thereof), 
     and such owner's ownership percentage;
       ``(III) contact information for such copyright owner;
       ``(IV) to the extent reasonably available to the mechanical 
     licensing collective--

       ``(aa) the international standard musical work code for the 
     work; and
       ``(bb) identifying information for sound recordings in 
     which the musical work is embodied, including the name of the 
     sound recording, featured artist, sound recording copyright 
     owner, producer, international standard recording code, and 
     other information commonly used to assist in associating 
     sound recordings with musical works; and

       ``(V) such other information as the Register of Copyrights 
     may prescribe by regulation.

       ``(iii) Unmatched works.--With respect to unmatched musical 
     works (and shares of works) in the database, the musical 
     works database shall include--

       ``(I) to the extent reasonably available to the mechanical 
     licensing collective--

       ``(aa) the title of the musical work;
       ``(bb) the ownership percentage for which an owner has not 
     been identified;
       ``(cc) if a copyright owner has been identified but not 
     located, the identity of such owner and such owner's 
     ownership percentage;
       ``(dd) identifying information for sound recordings in 
     which the work is embodied, including sound recording name, 
     featured artist, sound recording copyright owner, producer, 
     international standard recording code, and other information 
     commonly used to assist in associating sound recordings with 
     musical works; and
       ``(ee) any additional information reported to the 
     mechanical licensing collective that may assist in 
     identifying the work; and

       ``(II) such other information relating to the identity and 
     ownership of musical works (and shares of such works) as the 
     Register of Copyrights may prescribe by regulation.

       ``(iv) Sound recording information.--Each musical work 
     copyright owner with any musical work listed in the musical 
     works database shall engage in commercially reasonable 
     efforts to deliver to the mechanical licensing collective, 
     including for use in the musical works database, to the 
     extent such information is not then available in the 
     database, information regarding the names of the sound 
     recordings in which that copyright owner's musical works (or 
     shares thereof) are embodied, to the extent practicable.
       ``(v) Accessibility of database.--The musical works 
     database shall be made available to members of the public in 
     a searchable, online format, free of charge. The mechanical 
     licensing collective shall make such database available in a 
     bulk, machine-readable format, through a widely available 
     software application, to the following entities:

       ``(I) Digital music providers operating under the authority 
     of valid notices of license, free of charge.
       ``(II) Significant nonblanket licensees in compliance with 
     their obligations under paragraph (6), free of charge.
       ``(III) Authorized vendors of the entities described in 
     subclauses (I) and (II), free of charge.

[[Page H3526]]

       ``(IV) The Register of Copyrights, free of charge (but the 
     Register shall not treat such database or any information 
     therein as a Government record).
       ``(V) Any member of the public, for a fee not to exceed the 
     marginal cost to the mechanical licensing collective of 
     providing the database to such person.

       ``(vi) Additional requirements.--The Register of Copyrights 
     shall establish requirements by regulations to ensure the 
     usability, interoperability, and usage restrictions of the 
     musical works database.
       ``(F) Notices of license and nonblanket activity.--
       ``(i) Notices of licenses.--The mechanical licensing 
     collective shall receive, review, and confirm or reject 
     notices of license from digital music providers, as provided 
     in paragraph (2)(A). The collective shall maintain a current, 
     publicly accessible list of blanket licenses that includes 
     contact information for the licensees and the effective dates 
     of such licenses.
       ``(ii) Notices of nonblanket activity.--The mechanical 
     licensing collective shall receive notices of nonblanket 
     activity from significant nonblanket licensees, as provided 
     in paragraph (6)(A). The collective shall maintain a current, 
     publicly accessible list of notices of nonblanket activity 
     that includes contact information for significant nonblanket 
     licensees and the dates of receipt of such notices.
       ``(G) Collection and distribution of royalties.--
       ``(i) In general.--Upon receiving reports of usage and 
     payments of royalties from digital music providers for 
     covered activities, the mechanical licensing collective 
     shall--

       ``(I) engage in efforts to--

       ``(aa) identify the musical works embodied in sound 
     recordings reflected in such reports, and the copyright 
     owners of such musical works (and shares thereof);
       ``(bb) confirm uses of musical works subject to voluntary 
     licenses and individual download licenses, and the 
     corresponding pro rata amounts to be deducted from royalties 
     that would otherwise be due under the blanket license; and
       ``(cc) confirm proper payment of royalties due;

       ``(II) distribute royalties to copyright owners in 
     accordance with the usage and other information contained in 
     such reports, as well as the ownership and other information 
     contained in the records of the collective; and
       ``(III) deposit into an interest-bearing account, as 
     provided in subparagraph (H)(ii), royalties that cannot be 
     distributed due to--

       ``(aa) an inability to identify or locate a copyright owner 
     of a musical work (or share thereof); or
       ``(bb) a pending dispute before the dispute resolution 
     committee of the mechanical licensing collective.
       ``(ii) Other collection efforts.--Any royalties recovered 
     by the mechanical licensing collective as a result of efforts 
     to enforce rights or obligations under a blanket license, 
     including through a bankruptcy proceeding or other legal 
     action, shall be distributed to copyright owners based on 
     available usage information and in accordance with the 
     procedures described in subclauses (I) and (II) of clause 
     (i), on a pro rata basis in proportion to the overall 
     percentage recovery of the total royalties owed, with any pro 
     rata share of royalties that cannot be distributed deposited 
     in an interest-bearing account as provided in subparagraph 
     (H)(ii).
       ``(H) Holding of accrued royalties.--
       ``(i) Holding period.--The mechanical licensing collective 
     shall hold accrued royalties associated with particular 
     musical works (and shares of works) that remain unmatched for 
     a period of at least 3 years after the date on which the 
     funds were received by the mechanical licensing collective, 
     or at least 3 years after the date on which they were accrued 
     by a digital music provider that subsequently transferred 
     such funds to the mechanical licensing collective pursuant to 
     paragraph (10)(B), whichever period expires sooner.
       ``(ii) Interest-bearing account.--Accrued royalties for 
     unmatched works (and shares thereof) shall be maintained by 
     the mechanical licensing collective in an interest-bearing 
     account that earns monthly interest at the Federal, short-
     term rate, such interest to accrue for the benefit of 
     copyright owners entitled to payment of such accrued 
     royalties.
       ``(I) Musical works claiming process.--The mechanical 
     licensing collective shall publicize the existence of accrued 
     royalties for unmatched musical works (and shares of such 
     works) within 6 months of receiving a transfer of accrued 
     royalties for such works by publicly listing the works and 
     the procedures by which copyright owners may identify 
     themselves and provide ownership, contact, and other relevant 
     information to the mechanical licensing collective in order 
     to receive payment of accrued royalties. When a copyright 
     owner of an unmatched work (or share of a work) has been 
     identified and located in accordance with the procedures of 
     the mechanical licensing collective, the collective shall--
       ``(i) update the musical works database and its other 
     records accordingly; and
       ``(ii) provided that accrued royalties for the musical work 
     (or share thereof) have not yet been included in a 
     distribution pursuant to subparagraph (J)(i), pay such 
     accrued royalties and a proportionate amount of accrued 
     interest associated with that work (or share thereof) to the 
     copyright owner, accompanied by a cumulative statement of 
     account reflecting usage of such work and accrued royalties 
     based on information provided by digital music providers to 
     the mechanical licensing collective.
       ``(J) Distribution of unclaimed accrued royalties.--
       ``(i) Distribution procedures.--After the expiration of the 
     prescribed holding period for accrued royalties provided in 
     paragraph (H)(i), the mechanical licensing collective shall 
     distribute such accrued royalties, along with a proportionate 
     share of accrued interest, to copyright owners identified in 
     the records of the collective, subject to the following 
     requirements, and in accordance with the policies and 
     procedures established under clause (ii):

       ``(I) The first such distribution shall occur on or after 
     July 1 of the first full calendar year to commence after the 
     license availability date, with at least one such 
     distribution to take place during each calendar year 
     thereafter.
       ``(II) Copyright owners' payment shares for unclaimed 
     accrued royalties for particular reporting periods shall be 
     determined in a transparent and equitable manner based on 
     data indicating the relative market shares of such copyright 
     owners as reflected by royalty payments made by digital music 
     providers for covered activities for the periods in question, 
     including, in addition to royalty payments made to the 
     mechanical licensing collective, royalty payments made to 
     copyright owners under voluntary licenses and individual 
     download licenses for covered activities, to the extent such 
     information is available to the mechanical licensing 
     collective. In furtherance of the determination of equitable 
     market shares under this subparagraph--

       ``(aa) the mechanical licensing collective may require 
     copyright owners seeking distributions of unclaimed accrued 
     royalties to provide, or direct the provision of, information 
     concerning royalties received under voluntary licenses and 
     individual download licenses for covered activities, and
       ``(bb) the mechanical licensing collective shall take 
     appropriate steps to safeguard the confidentiality and 
     security of financial and other sensitive data used to 
     compute market shares in accordance with the confidentiality 
     provisions prescribed by the Register of Copyrights under 
     paragraph (12)(C).
       ``(ii) Establishment of distribution policies.--The 
     unclaimed royalties oversight committee established under 
     paragraph (3)(D)(iv) shall establish policies and procedures 
     for the distribution of unclaimed accrued royalties and 
     accrued interest in accordance with this subparagraph, 
     including the provision of usage data to copyright owners to 
     allocate payments and credits to songwriters pursuant to 
     clause (iv), subject to the approval of the board of 
     directors of the mechanical licensing collective.
       ``(iii) Advance notice of distributions.--The mechanical 
     licensing collective shall publicize a pending distribution 
     of unclaimed accrued royalties and accrued interest at least 
     90 calendar days in advance of such distribution.
       ``(iv) Songwriter payments.--Copyright owners that receive 
     a distribution of unclaimed accrued royalties and accrued 
     interest shall pay or credit a portion to songwriters (or the 
     authorized agents of songwriters) on whose behalf the 
     copyright owners license or administer musical works for 
     covered activities, in accordance with applicable contractual 
     terms, but notwithstanding any agreement to the contrary--

       ``(I) such payments and credits to songwriters shall be 
     allocated in proportion to reported usage of individual 
     musical works by digital music providers during the reporting 
     periods covered by the distribution from the mechanical 
     licensing collective; and
       ``(II) in no case shall the payment or credit to an 
     individual songwriter be less than 50 percent of the payment 
     received by the copyright owner attributable to usage of 
     musical works (or shares of works) of that songwriter.

       ``(K) Dispute resolution.--The dispute resolution committee 
     established under paragraph (3)(D)(v) shall address and 
     resolve in a timely and equitable manner disputes among 
     copyright owners relating to ownership interests in musical 
     works licensed under this section and allocation and 
     distribution of royalties by the mechanical licensing 
     collective, according to a process approved by the board of 
     directors of the mechanical licensing collective. Such 
     process--
       ``(i) shall include a mechanism to hold disputed funds in 
     accordance with the requirements described in subparagraph 
     (H)(ii) pending resolution of the dispute; and
       ``(ii) except as provided in paragraph (11)(D), shall not 
     affect any legal or equitable rights or remedies available to 
     any copyright owner or songwriter concerning ownership of, 
     and entitlement to royalties for, a musical work.
       ``(L) Verification of payments by mechanical licensing 
     collective.--
       ``(i) Verification process.--A copyright owner entitled to 
     receive payments of royalties for covered activities from the 
     mechanical licensing collective may, individually or with 
     other copyright owners, conduct an audit of the mechanical 
     licensing collective to verify the accuracy of royalty 
     payments by the mechanical licensing collective to such 
     copyright owner, as follows:

       ``(I) A copyright owner may audit the mechanical licensing 
     collective only once in a year for any or all of the prior 3 
     calendar

[[Page H3527]]

     years, and may not audit records for any calendar year more 
     than once.
       ``(II) The audit shall be conducted by a qualified auditor, 
     who shall perform the audit during the ordinary course of 
     business by examining the books, records, and data of the 
     mechanical licensing collective, according to generally 
     accepted auditing standards and subject to applicable 
     confidentiality requirements prescribed by the Register of 
     Copyrights under paragraph (12)(C).
       ``(III) The mechanical licensing collective shall make such 
     books, records, and data available to the qualified auditor 
     and respond to reasonable requests for relevant information, 
     and shall use commercially reasonable efforts to facilitate 
     access to relevant information maintained by third parties.
       ``(IV) To commence the audit, any copyright owner shall 
     file with the Copyright Office a notice of intent to conduct 
     an audit of the mechanical licensing collective, identifying 
     the period of time to be audited, and shall simultaneously 
     deliver a copy of such notice to the mechanical licensing 
     collective. The Register of Copyrights shall cause the notice 
     of audit to be published in the Federal Register within 45 
     calendar days after receipt.
       ``(V) The qualified auditor shall determine the accuracy of 
     royalty payments, including whether an underpayment or 
     overpayment of royalties was made by the mechanical licensing 
     collective to each auditing copyright owner, but before 
     providing a final audit report to any such copyright owner, 
     the qualified auditor shall provide a tentative draft of the 
     report to the mechanical licensing collective and allow the 
     mechanical licensing collective a reasonable opportunity to 
     respond to the findings, including by clarifying issues and 
     correcting factual errors.
       ``(VI) The auditing copyright owner or owners shall bear 
     the cost of the audit. In case of an underpayment to any 
     copyright owner, the mechanical licensing collective shall 
     pay the amounts of any such underpayment to such auditing 
     copyright owner, as appropriate. In case of an overpayment by 
     the mechanical licensing collective, the mechanical licensing 
     collective may debit the account of the auditing copyright 
     owner or owners for such overpaid amounts, or such owner(s) 
     shall refund overpaid amounts to the mechanical licensing 
     collective, as appropriate.

       ``(ii) Alternative verification procedures.--Nothing in 
     this subparagraph shall preclude a copyright owner and the 
     mechanical licensing collective from agreeing to audit 
     procedures different from those described herein, but a 
     notice of the audit shall be provided to and published by the 
     Copyright Office as described in clause (i)(IV).
       ``(M) Records of mechanical licensing collective.--
       ``(i) Records maintenance.--The mechanical licensing 
     collective shall ensure that all material records of its 
     operations, including those relating to notices of license, 
     the administration of its claims process, reports of usage, 
     royalty payments, receipt and maintenance of accrued 
     royalties, royalty distribution processes, and legal matters, 
     are preserved and maintained in a secure and reliable manner, 
     with appropriate commercially reasonable safeguards against 
     unauthorized access, copying, and disclosure, and subject to 
     the confidentiality requirements prescribed by the Register 
     of Copyrights under paragraph (12)(C) for a period of no less 
     than 7 years after the date of creation or receipt, whichever 
     occurs later.
       ``(ii) Records access.--The mechanical licensing collective 
     shall provide prompt access to electronic and other records 
     pertaining to the administration of a copyright owner's 
     musical works upon reasonable written request of such owner 
     or the owner's authorized representative.
       ``(4) Terms and conditions of blanket license.--A blanket 
     license is subject to, and conditioned upon, the following 
     requirements:
       ``(A) Royalty reporting and payments.--
       ``(i) Monthly reports and payment.--A digital music 
     provider shall report and pay royalties to the mechanical 
     licensing collective under the blanket license on a monthly 
     basis in accordance with clause (ii) and subsection 
     (c)(2)(I), but the monthly reporting shall be due 45 calendar 
     days, rather than 20 calendar days, after the end of the 
     monthly reporting period.
       ``(ii) Data to be reported.--In reporting usage of musical 
     works to the mechanical licensing collective, a digital music 
     provider shall provide usage data for musical works used 
     under the blanket license and usage data for musical works 
     used in covered activities under voluntary licenses and 
     individual download licenses. In the report of usage, the 
     digital music provider shall--

       ``(I) with respect to each sound recording embodying a 
     musical work--

       ``(aa) provide identifying information for the sound 
     recording, including sound recording name, featured artist 
     and, to the extent acquired by the digital music provider in 
     connection with its use of sound recordings of musical works 
     to engage in covered activities, including pursuant to 
     subparagraph (B), producer, international standard recording 
     code, and other information commonly used in the industry to 
     identify sound recordings and match them to the musical works 
     the sound recordings embody;
       ``(bb) to the extent acquired by the digital music provider 
     in the metadata in connection with its use of sound 
     recordings of musical works to engage in covered activities, 
     including pursuant to subparagraph (B), provide information 
     concerning authorship and ownership of the applicable rights 
     in the musical work embodied in the sound recording 
     (including each songwriter, publisher name, and respective 
     ownership share) and the international standard musical work 
     code; and
       ``(cc) provide the number of digital phonorecord deliveries 
     of the sound recording, including limited downloads and 
     interactive streams;

       ``(II) identify and provide contact information for all 
     musical work copyright owners for works embodied in sound 
     recordings as to which a voluntary license, rather than the 
     blanket license, is in effect with respect to the uses being 
     reported; and
       ``(III) provide such other information as the Register of 
     Copyrights shall require by regulation.

       ``(iii) Format and maintenance of reports.--Reports of 
     usage provided by digital music providers to the mechanical 
     licensing collective shall be in a machine-readable format 
     that is compatible with the information technology systems of 
     the mechanical licensing collective and meets the 
     requirements of regulations adopted by the Register of 
     Copyrights. The Register shall also adopt regulations setting 
     forth requirements under which records of use shall be 
     maintained and made available to the mechanical licensing 
     collective by digital music providers engaged in covered 
     activities under a blanket license.
       ``(iv) Adoption of regulations.--The Register shall adopt 
     regulations--

       ``(I) setting forth requirements under which records of use 
     shall be maintained and made available to the mechanical 
     licensing collective by digital music providers engaged in 
     covered activities under a blanket license; and
       ``(II) regarding adjustments to reports of usage by digital 
     music providers, including mechanisms to account for 
     overpayment and underpayment of royalties in prior periods.

       ``(B) Collection of sound recording information.--A digital 
     music provider shall engage in good-faith, commercially 
     reasonable efforts to obtain from copyright owners of sound 
     recordings made available through the service of such digital 
     music provider--
       ``(i) sound recording copyright owners, producers, 
     international standard recording codes, and other information 
     commonly used in the industry to identify sound recordings 
     and match them to the musical works the sound recordings 
     embody; and
       ``(ii) information concerning the authorship and ownership 
     of musical works, including songwriters, publisher names, 
     ownership shares, and international standard musical work 
     codes.
       ``(C) Payment of administrative assessment.--A digital 
     music provider and any significant nonblanket licensee shall 
     pay the administrative assessment established under paragraph 
     (7)(D) in accordance with this subsection and applicable 
     regulations.
       ``(D) Verification of payments by digital music 
     providers.--
       ``(i) Verification process.--The mechanical licensing 
     collective may conduct an audit of a digital music provider 
     operating under the blanket license to verify the accuracy of 
     royalty payments by the digital music provider to the 
     mechanical licensing collective as follows:

       ``(I) The mechanical licensing collective may commence an 
     audit of a digital music provider no more than once in any 3-
     calendar-year period to cover a verification period of no 
     more than the 3 full calendar years preceding the date of 
     commencement of the audit, and such audit may not audit 
     records for any such 3-year verification period more than 
     once.
       ``(II) The audit shall be conducted by a qualified auditor, 
     who shall perform the audit during the ordinary course of 
     business by examining the books, records, and data of the 
     digital music provider, according to generally accepted 
     auditing standards and subject to applicable confidentiality 
     requirements prescribed by the Register of Copyrights under 
     paragraph (12)(C).
       ``(III) The digital music provider shall make such books, 
     records, and data available to the qualified auditor and 
     respond to reasonable requests for relevant information, and 
     shall use commercially reasonable efforts to provide access 
     to relevant information maintained with respect to a digital 
     music provider by third parties.
       ``(IV) To commence the audit, the mechanical licensing 
     collective shall file with the Copyright Office a notice of 
     intent to conduct an audit of the digital music provider, 
     identifying the period of time to be audited, and shall 
     simultaneously deliver a copy of such notice to the digital 
     music provider. The Register of Copyrights shall cause the 
     notice of audit to be published in the Federal Register 
     within 45 calendar days after receipt.
       ``(V) The qualified auditor shall determine the accuracy of 
     royalty payments, including whether an underpayment or 
     overpayment of royalties was made by the digital music 
     provider to the mechanical licensing collective, but before 
     providing a final audit report to the mechanical licensing 
     collective, the qualified auditor shall provide a tentative 
     draft of the report to the digital music provider and allow 
     the digital music provider a reasonable opportunity to 
     respond to the findings, including by clarifying issues and 
     correcting factual errors.
       ``(VI) The mechanical licensing collective shall pay the 
     cost of the audit, unless the

[[Page H3528]]

     qualified auditor determines that there was an underpayment 
     by the digital music provider of 10 percent or more, in which 
     case the digital music provider shall bear the reasonable 
     costs of the audit, in addition to paying the amount of any 
     underpayment to the mechanical licensing collective. In case 
     of an overpayment by the digital music provider, the 
     mechanical licensing collective shall provide a credit to the 
     account of the digital music provider.
       ``(VII) A digital music provider may not assert section 507 
     or any other Federal or State statute of limitations, 
     doctrine of laches or estoppel, or similar provision as a 
     defense to a legal action arising from an audit under this 
     subparagraph if such legal action is commenced no more than 6 
     years after the commencement of the audit that is the basis 
     for such action.

       ``(ii) Alternative verification procedures.--Nothing in 
     this subparagraph shall preclude the mechanical licensing 
     collective and a digital music provider from agreeing to 
     audit procedures different from those described herein, but a 
     notice of the audit shall be provided to and published by the 
     Copyright Office as described in clause (i)(IV).
       ``(E) Default under blanket license.--
       ``(i) Conditions of default.--A digital music provider 
     shall be in default under a blanket license if the digital 
     music provider--

       ``(I) fails to provide one or more monthly reports of usage 
     to the mechanical licensing collective when due;
       ``(II) fails to make a monthly royalty or late fee payment 
     to the mechanical licensing collective when due, in all or 
     material part;
       ``(III) provides one or more monthly reports of usage to 
     the mechanical licensing collective that, on the whole, is or 
     are materially deficient as a result of inaccurate, missing, 
     or unreadable data, where the correct data was available to 
     the digital music provider and required to be reported under 
     this section and applicable regulations;
       ``(IV) fails to pay the administrative assessment as 
     required under this subsection and applicable regulations; or
       ``(V) after being provided written notice by the mechanical 
     licensing collective, refuses to comply with any other 
     material term or condition of the blanket license under this 
     section for a period of 60 calendar days or longer.

       ``(ii) Notice of default and termination.--In case of a 
     default by a digital music provider, the mechanical licensing 
     collective may proceed to terminate the blanket license of 
     the digital music provider as follows:

       ``(I) The mechanical licensing collective shall provide 
     written notice to the digital music provider describing with 
     reasonable particularity the default and advising that unless 
     such default is cured within 60 calendar days after the date 
     of the notice, the blanket license will automatically 
     terminate at the end of that period.
       ``(II) If the digital music provider fails to remedy the 
     default within the 60-day period referenced in subclause (I), 
     the license shall terminate without any further action on the 
     part of the mechanical licensing collective. Such termination 
     renders the making of all digital phonorecord deliveries of 
     all musical works (and shares thereof) covered by the blanket 
     license for which the royalty or administrative assessment 
     has not been paid actionable as acts of infringement under 
     section 501 and subject to the remedies provided by sections 
     502 through 506.

       ``(iii) Notice to copyright owners.--The mechanical 
     licensing collective shall provide written notice of any 
     termination under this subparagraph to copyright owners of 
     affected works.
       ``(iv) Review by federal district court.--A digital music 
     provider that believes a blanket license was improperly 
     terminated by the mechanical licensing collective may seek 
     review of such termination in Federal district court. The 
     district court shall determine the matter de novo based on 
     the record before the mechanical licensing collective and any 
     additional supporting evidence presented by the parties.
       ``(5) Digital licensee coordinator.--
       ``(A) In general.--The digital licensee coordinator shall 
     be a single entity that--
       ``(i) is a nonprofit, not owned by any other entity, that 
     is created to carry out responsibilities under this 
     subsection;
       ``(ii) is endorsed by and enjoys substantial support from 
     digital music providers and significant nonblanket licensees 
     that together represent the greatest percentage of the 
     licensee market for uses of musical works in covered 
     activities, as measured over the preceding 3 calendar years;
       ``(iii) is able to demonstrate that it has, or will have 
     prior to the license availability date, the administrative 
     capabilities to perform the required functions of the digital 
     licensee coordinator under this subsection; and
       ``(iv) has been designated by the Register of Copyrights in 
     accordance with subparagraph (B).
       ``(B) Designation of digital licensee coordinator.--
       ``(i) Initial designation.--The Register of Copyrights 
     shall initially designate the digital licensee coordinator 
     within 9 months after the enactment date, in accordance with 
     the same procedure described for designation of the 
     mechanical licensing collective in paragraph (3)(B)(i).
       ``(ii) Periodic review of designation.--Following the 
     initial designation of the digital licensee coordinator, the 
     Register shall, every 5 years, beginning with the fifth full 
     calendar year to commence after the initial designation, 
     determine whether the existing designation should be 
     continued, or a different entity meeting the criteria 
     described in clauses (i) through (iii) of subparagraph (A) 
     should be designated, in accordance with the same procedure 
     described for the mechanical licensing collective in 
     paragraph (3)(B)(ii).
       ``(iii) Inability to designate.--If the Register is unable 
     to identify an entity that fulfills each of the 
     qualifications described in clauses (i) through (iii) of 
     subparagraph (A) to serve as the digital licensee 
     coordinator, the Register may decline to designate a digital 
     licensee coordinator. The Register's determination not to 
     designate a digital licensee coordinator shall not negate or 
     otherwise affect any provision of this subsection except to 
     the limited extent that a provision references the digital 
     licensee coordinator. In such case, the reference to the 
     digital licensee coordinator shall be without effect unless 
     and until a new digital licensee coordinator is designated.
       ``(C) Authorities and functions.--
       ``(i) In general.--The digital licensee coordinator is 
     authorized to perform the following functions, subject to 
     more particular requirements as described in this subsection:

       ``(I) Establish a governance structure, criteria for 
     membership, and any dues to be paid by its members.
       ``(II) Engage in efforts to enforce notice and payment 
     obligations with respect to the administrative assessment, 
     including by receiving information from and coordinating with 
     the mechanical licensing collective.
       ``(III) Initiate and participate in proceedings before the 
     Copyright Royalty Judges to establish the administrative 
     assessment under this subsection.
       ``(IV) Initiate and participate in proceedings before the 
     Copyright Office with respect to activities under this 
     subsection.
       ``(V) Gather and provide documentation for use in 
     proceedings before the Copyright Royalty Judges to set rates 
     and terms under this section.
       ``(VI) Maintain records of its activities.
       ``(VII) Engage in such other activities as may be necessary 
     or appropriate to fulfill its responsibilities under this 
     subsection.

       ``(ii) Restriction on lobbying.--The digital licensee 
     coordinator may not engage in government lobbying activities, 
     but may engage in the activities described in subclauses 
     (III), (IV), and (V) of clause (i).
       ``(6) Requirements for significant nonblanket licensees.--
       ``(A) In general.--
       ``(i) Notice of activity.--Not later than 45 calendar days 
     after the license availability date, or 45 calendar days 
     after the end of the first full calendar month in which an 
     entity initially qualifies as a significant nonblanket 
     licensee, whichever occurs later, a significant nonblanket 
     licensee shall submit a notice of nonblanket activity to the 
     mechanical licensing collective. The notice of nonblanket 
     activity shall comply in form and substance with requirements 
     that the Register of Copyrights shall establish by 
     regulation, and a copy shall be made available to the digital 
     licensee coordinator.
       ``(ii) Reporting and payment obligations.--The notice of 
     nonblanket activity submitted to the mechanical licensing 
     collective shall be accompanied by a report of usage that 
     contains the information described in paragraph (4)(A)(ii), 
     as well as any payment of the administrative assessment 
     required under this subsection and applicable regulations. 
     Thereafter, subject to clause (iii), a significant nonblanket 
     licensee shall continue to provide monthly reports of usage, 
     accompanied by any required payment of the administrative 
     assessment, to the mechanical licensing collective. Such 
     reports and payments shall be submitted not later than 45 
     calendar days after the end of the calendar month being 
     reported.
       ``(iii) Discontinuation of obligations.--An entity that has 
     submitted a notice of nonblanket activity to the mechanical 
     licensing collective that has ceased to qualify as a 
     significant nonblanket licensee may so notify the collective 
     in writing. In such case, as of the calendar month in which 
     such notice is provided, such entity shall no longer be 
     required to provide reports of usage or pay the 
     administrative assessment, but if such entity later qualifies 
     as a significant nonblanket licensee, such entity shall again 
     be required to comply with clauses (i) and (ii).
       ``(B) Reporting by mechanical licensing collective to 
     digital licensee coordinator.--
       ``(i) Monthly reports of noncompliant licensees.--The 
     mechanical licensing collective shall provide monthly reports 
     to the digital licensee coordinator setting forth any 
     significant nonblanket licensees of which the collective is 
     aware that have failed to comply with subparagraph (A).
       ``(ii) Treatment of confidential information.--The 
     mechanical licensing collective and digital licensee 
     coordinator shall take appropriate steps to safeguard the 
     confidentiality and security of financial and other sensitive 
     data shared under this subparagraph, in accordance with the 
     confidentiality requirements prescribed by the Register of 
     Copyrights under paragraph (12)(C).
       ``(C) Legal enforcement efforts.--
       ``(i) Federal court action.--Should the mechanical 
     licensing collective or digital licensee coordinator become 
     aware that a significant nonblanket licensee has failed to

[[Page H3529]]

     comply with subparagraph (A), either may commence an action 
     in Federal district court for damages and injunctive relief. 
     If the significant nonblanket licensee is found liable, the 
     court shall, absent a finding of excusable neglect, award 
     damages in an amount equal to three times the total amount of 
     the unpaid administrative assessment and, notwithstanding 
     anything to the contrary in section 505, reasonable 
     attorney's fees and costs, as well as such other relief as 
     the court deems appropriate. In all other cases, the court 
     shall award relief as appropriate. Any recovery of damages 
     shall be payable to the mechanical licensing collective as an 
     offset to the collective total costs.
       ``(ii) Statute of limitations for enforcement action.--Any 
     action described in this subparagraph shall be commenced 
     within the time period described in section 507(b).
       ``(iii) Other rights and remedies preserved.--The ability 
     of the mechanical licensing collective or digital licensee 
     coordinator to bring an action under this subparagraph shall 
     in no way alter, limit or negate any other right or remedy 
     that may be available to any party at law or in equity.
       ``(7) Funding of mechanical licensing collective.--
       ``(A) In general.--The collective total costs shall be 
     funded by--
       ``(i) an administrative assessment, as such assessment is 
     established by the Copyright Royalty Judges pursuant to 
     subparagraph (D) from time to time, to be paid by--

       ``(I) digital music providers that are engaged, in all or 
     in part, in covered activities pursuant to a blanket license; 
     and
       ``(II) significant nonblanket licensees; and

       ``(ii) voluntary contributions from digital music providers 
     and significant nonblanket licensees as may be agreed with 
     copyright owners.
       ``(B) Voluntary contributions.--
       ``(i) Agreements concerning contributions.--Except as 
     provided in clause (ii), voluntary contributions by digital 
     music providers and significant nonblanket licensees shall be 
     determined by private negotiation and agreement, and the 
     following conditions apply:

       ``(I) The date and amount of each voluntary contribution to 
     the mechanical licensing collective shall be documented in a 
     writing signed by an authorized agent of the mechanical 
     licensing collective and the contributing party.
       ``(II) Such agreement shall be made available as required 
     in proceedings before the Copyright Royalty Judges to 
     establish or adjust the administrative assessment in 
     accordance with applicable statutory and regulatory 
     provisions and rulings of the Copyright Royalty Judges.

       ``(ii) Treatment of contributions.--Each such voluntary 
     contribution shall be treated for purposes of an 
     administrative assessment proceeding as an offset to the 
     collective total costs that would otherwise be recovered 
     through the administrative assessment. Any allocation or 
     reallocation of voluntary contributions between or among 
     individual digital music providers or significant nonblanket 
     licensees shall be a matter of private negotiation and 
     agreement among such parties and outside the scope of the 
     administrative assessment proceeding.
       ``(C) Interim application of accrued royalties.--In the 
     event that the administrative assessment, together with any 
     funding from voluntary contributions as provided in 
     subparagraphs (A) and (B), is inadequate to cover current 
     collective total costs, the collective, with approval of its 
     board of directors, may apply unclaimed accrued royalties on 
     an interim basis to defray such costs, subject to future 
     reimbursement of such royalties from future collections of 
     the assessment.
       ``(D) Determination of administrative assessment.--
       ``(i) Administrative assessment to cover collective total 
     costs.--The administrative assessment shall be used solely 
     and exclusively to fund the collective total costs.
       ``(ii) Separate proceeding before copyright royalty 
     judges.--The amount and terms of the administrative 
     assessment shall be determined and established in a separate 
     and independent proceeding before the Copyright Royalty 
     Judges, according to the procedures described in clauses 
     (iii) and (iv). The administrative assessment determined in 
     such proceeding shall--

       ``(I) be wholly independent of royalty rates and terms 
     applicable to digital music providers, which shall not be 
     taken into consideration in any manner in establishing the 
     administrative assessment;
       ``(II) be established by the Copyright Royalty Judges in an 
     amount that is calculated to defray the reasonable collective 
     total costs;
       ``(III) be assessed based on usage of musical works by 
     digital music providers and significant nonblanket licensees 
     in covered activities under both compulsory and nonblanket 
     licenses;
       ``(IV) may be in the form of a percentage of royalties 
     payable under this section for usage of musical works in 
     covered activities (regardless of whether a different rate 
     applies under a voluntary license), or any other usage-based 
     metric reasonably calculated to equitably allocate the 
     collective total costs across digital music providers and 
     significant nonblanket licensees engaged in covered 
     activities, but shall include as a component a minimum fee 
     for all digital music providers and significant nonblanket 
     licensees; and
       ``(V) take into consideration anticipated future collective 
     total costs and collections of the administrative assessment, 
     but also, as applicable--

       ``(aa) any portion of past actual collective total costs of 
     the mechanical licensing collective not funded by previous 
     collections of the administrative assessment or voluntary 
     contributions because such collections or contributions 
     together were insufficient to fund such costs;
       ``(bb) any past collections of the administrative 
     assessment and voluntary contributions that exceeded past 
     actual collective total costs, resulting in a surplus; and
       ``(cc) the amount of any voluntary contributions by digital 
     music providers or significant nonblanket licensees in 
     relevant periods, described in subparagraphs (A) and (B) of 
     paragraph (7).
       ``(iii) Initial administrative assessment.--The procedure 
     for establishing the initial administrative assessment shall 
     be as follows:

       ``(I) The Copyright Royalty Judges shall commence a 
     proceeding to establish the initial administrative assessment 
     within 9 months after the enactment date by publishing a 
     notice in the Federal Register seeking petitions to 
     participate.
       ``(II) The mechanical licensing collective and digital 
     licensee coordinator shall participate in such proceeding, 
     along with any interested copyright owners, digital music 
     providers or significant nonblanket licensees that have 
     notified the Copyright Royalty Judges of their desire to 
     participate.
       ``(III) The Copyright Royalty Judges shall establish a 
     schedule for submission by the parties of information that 
     may be relevant to establishing the administrative 
     assessment, including actual and anticipated collective total 
     costs of the mechanical licensing collective, actual and 
     anticipated collections from digital music providers and 
     significant nonblanket licensees, and documentation of 
     voluntary contributions, as well as a schedule for further 
     proceedings, which shall include a hearing, as they deem 
     appropriate.
       ``(IV) The initial administrative assessment shall be 
     determined, and such determination shall be published in the 
     Federal Register by the Copyright Royalty Judges, within 1 
     year after commencement of the proceeding described in this 
     clause. The determination shall be supported by a written 
     record. The initial administrative assessment shall be 
     effective as of the license availability date, and shall 
     continue in effect unless and until an adjusted 
     administrative assessment is established pursuant to an 
     adjustment proceeding under clause (iii).

       ``(iv) Adjustment of administrative assessment.--The 
     administrative assessment may be adjusted by the Copyright 
     Royalty Judges periodically, in accordance with the following 
     procedures:

       ``(I) No earlier than one year after the most recent 
     publication of a determination of the administrative 
     assessment by the Copyright Royalty Judges, the mechanical 
     licensing collective, the digital licensee coordinator, or 
     one or more interested copyright owners, digital music 
     providers, or significant nonblanket licensees, may file a 
     petition with the Copyright Royalty Judges in the month of 
     October to commence a proceeding to adjust the administrative 
     assessment.
       ``(II) Notice of the commencement of such proceeding shall 
     be published in the Federal Register in the month of November 
     following the filing of any petition, with a schedule of 
     requested information and additional proceedings, as 
     described in clause (iii)(III). The mechanical licensing 
     collective and digital licensee coordinator shall participate 
     in such proceeding, along with any interested copyright 
     owners, digital music providers, or significant nonblanket 
     licensees that have notified the Copyright Royalty Judges of 
     their desire to participate.
       ``(III) The determination of the adjusted administrative 
     assessment, which shall be supported by a written record, 
     shall be published in the Federal Register during November of 
     the calendar year following the commencement of the 
     proceeding. The adjusted administrative assessment shall take 
     effect January 1 of the year following such publication.

       ``(v) Adoption of voluntary agreements.--In lieu of 
     reaching their own determination based on evaluation of 
     relevant data, the Copyright Royalty Judges shall approve and 
     adopt a negotiated agreement to establish the amount and 
     terms of the administrative assessment that has been agreed 
     to by the mechanical licensing collective and the digital 
     licensee coordinator (or if none has been designated, 
     interested digital music providers and significant nonblanket 
     licensees representing more than half of the market for uses 
     of musical works in covered activities), but the Copyright 
     Royalty Judges shall have the discretion to reject any such 
     agreement for good cause shown. An administrative assessment 
     adopted under this clause shall apply to all digital music 
     providers and significant nonblanket licensees engaged in 
     covered activities during the period it is in effect.
       ``(vi) Continuing authority to amend.--The Copyright 
     Royalty Judges shall retain continuing authority to amend a 
     determination of an administrative assessment to correct 
     technical or clerical errors, or modify the terms of 
     implementation, for good cause, with any such amendment to be 
     published in the Federal Register.

[[Page H3530]]

       ``(vii) Appeal of administrative assessment.--The 
     determination of an administrative assessment by the 
     Copyright Royalty Judges shall be appealable, within 30 
     calendar days after publication in the Federal Register, to 
     the Court of Appeals for the District of Columbia Circuit by 
     any party that fully participated in the proceeding. The 
     administrative assessment as established by the Copyright 
     Royalty Judges shall remain in effect pending the final 
     outcome of any such appeal, and the mechanical licensing 
     collective, digital licensee coordinator, digital music 
     providers, and significant nonblanket licensees shall 
     implement appropriate financial or other measures within 3 
     months after any modification of the assessment to reflect 
     and account for such outcome.
       ``(viii) Regulations.--The Copyright Royalty Judges may 
     adopt regulations to govern the conduct of proceedings under 
     this paragraph.
       ``(8) Establishment of rates and terms under blanket 
     license.--
       ``(A) Restrictions on ratesetting participation.--Neither 
     the mechanical licensing collective nor the digital licensee 
     coordinator shall be a party to a proceeding described in 
     subsection (c)(1)(E), but either may gather and provide 
     financial and other information for the use of a party to 
     such a proceeding and comply with requests for information as 
     required under applicable statutory and regulatory provisions 
     and rulings of the Copyright Royalty Judges.
       ``(B) Application of late fees.--In any proceeding 
     described in subparagraph (A) in which the Copyright Royalty 
     Judges establish a late fee for late payment of royalties for 
     uses of musical works under this section, such fee shall 
     apply to covered activities under blanket licenses, as 
     follows:
       ``(i) Late fees for past due royalty payments shall accrue 
     from the due date for payment until payment is received by 
     the mechanical licensing collective.
       ``(ii) The availability of late fees shall in no way 
     prevent a copyright owner or the mechanical licensing 
     collective from asserting any other rights or remedies to 
     which such copyright owner or the mechanical licensing 
     collective may be entitled under this title.
       ``(C) Interim rate agreements in general.--For any covered 
     activity for which no rate or terms have been established by 
     the Copyright Royalty Judges, the mechanical licensing 
     collective and any digital music provider may agree to an 
     interim rate and terms for such activity under the blanket 
     license, and any such rate and terms--
       ``(i) shall be treated as nonprecedential and not cited or 
     relied upon in any ratesetting proceeding before the 
     Copyright Royalty Judges or any other tribunal; and
       ``(ii) shall automatically expire upon the establishment of 
     a rate and terms for such covered activity by the Copyright 
     Royalty Judges, under subsection (c)(1)(E).
       ``(D) Adjustments for interim rates.--The rate and terms 
     established by the Copyright Royalty Judges for a covered 
     activity to which an interim rate and terms have been agreed 
     under subparagraph (C) shall supersede the interim rate and 
     terms and apply retroactively to the inception of the 
     activity under the blanket license. In such case, within 3 
     months after the rate and terms established by the Copyright 
     Royalty Judges become effective--
       ``(i) if the rate established by the Copyright Royalty 
     Judges exceeds the interim rate, the digital music provider 
     shall pay to the mechanical licensing collective the amount 
     of any underpayment of royalties due; or
       ``(ii) if the interim rate exceeds the rate established by 
     the Copyright Royalty Judges, the mechanical licensing 
     collective shall credit the account of the digital music 
     provider for the amount of any overpayment of royalties due.
       ``(9) Transition to blanket licenses.--
       ``(A) Substitution of blanket license.--On the license 
     availability date, a blanket license shall, without any 
     interruption in license authority enjoyed by such digital 
     music provider, be automatically substituted for and 
     supersede any existing compulsory license previously obtained 
     under this section by the digital music provider from a 
     copyright owner to engage in one or more covered activities 
     with respect to a musical work, but the foregoing shall not 
     apply to any authority obtained from a record company 
     pursuant to a compulsory license to make and distribute 
     permanent downloads unless and until such record company 
     terminates such authority in writing to take effect at the 
     end of a monthly reporting period, with a copy to the 
     mechanical licensing collective.
       ``(B) Expiration of existing licenses.--Except to the 
     extent provided in subparagraph (A), on and after the license 
     availability date, licenses other than individual download 
     licenses obtained under this section for covered activities 
     prior to the license availability date shall no longer 
     continue in effect.
       ``(C) Treatment of voluntary licenses.--A voluntary license 
     for a covered activity in effect on the license availability 
     date will remain in effect unless and until the voluntary 
     license expires according to the terms of the voluntary 
     license, or the parties agree to amend or terminate the 
     voluntary license. In a case where a voluntary license for a 
     covered activity entered into before the license availability 
     date incorporates the terms of this section by reference, the 
     terms so incorporated (but not the rates) shall be those in 
     effect immediately prior to the license availability date, 
     and those terms shall continue to apply unless and until such 
     voluntary license is terminated or amended, or the parties 
     enter into a new voluntary license.
       ``(D) Further acceptance of notices for covered activities 
     by copyright office.--On and after the enactment date--
       ``(i) the Copyright Office shall no longer accept notices 
     of intention with respect to covered activities; and
       ``(ii) previously filed notices of intention will no longer 
     be effective or provide license authority with respect to 
     covered activities, but before the license availability date 
     there shall be no liability under section 501 for the 
     reproduction or distribution of a musical work (or share 
     thereof) in covered activities if a valid notice of intention 
     was filed for such work (or share) before the enactment date.
       ``(10) Prior unlicensed uses.--
       ``(A) Limitation on liability in general.--A copyright 
     owner that commences an action under section 501 on or after 
     January 1, 2018, against a digital music provider for the 
     infringement of the exclusive rights provided by paragraph 
     (1) or (3) of section 106 arising from the unauthorized 
     reproduction or distribution of a musical work by such 
     digital music provider in the course of engaging in covered 
     activities prior to the license availability date, shall, as 
     the copyright owner's sole and exclusive remedy against the 
     digital music provider, be eligible to recover the royalty 
     prescribed under subsection (c)(1)(C) and chapter 8 of this 
     title, from the digital music provider, provided that such 
     digital music provider can demonstrate compliance with the 
     requirements of subparagraph (B), as applicable. In all other 
     cases the limitation on liability under this subparagraph 
     shall not apply.
       ``(B) Requirements for limitation on liability.--The 
     following requirements shall apply on the enactment date and 
     through the end of the period that expires 90 days after the 
     license availability date to digital music providers seeking 
     to avail themselves of the limitation on liability described 
     in subparagraph (A):
       ``(i) No later than 30 calendar days after first making a 
     particular sound recording of a musical work available 
     through its service via one or more covered activities, or 30 
     calendar days after the enactment date, whichever occurs 
     later, a digital music provider shall engage in good-faith, 
     commercially reasonable efforts to identify and locate each 
     copyright owner of such musical work (or share thereof). Such 
     required matching efforts shall include the following:

       ``(I) Good-faith, commercially reasonable efforts to obtain 
     from the owner of the corresponding sound recording made 
     available through the digital music provider's service the 
     following information:

       ``(aa) Sound recording name, featured artist, sound 
     recording copyright owner, producer, international standard 
     recording code, and other information commonly used in the 
     industry to identify sound recordings and match them to the 
     musical works they embody.
       ``(bb) Any available musical work ownership information, 
     including each songwriter and publisher name, percentage 
     ownership share, and international standard musical work 
     code.

       ``(II) Employment of one or more bulk electronic matching 
     processes that are available to the digital music provider 
     through a third-party vendor on commercially reasonable 
     terms, but a digital music provider may rely on its own bulk 
     electronic matching process if it has capabilities comparable 
     to or better than those available from a third-party vendor 
     on commercially reasonable terms.

       ``(ii) The required matching efforts shall be repeated by 
     the digital music provider no less than once per month for so 
     long as the copyright owner remains unidentified or has not 
     been located.
       ``(iii) If the required matching efforts are successful in 
     identifying and locating a copyright owner of a musical work 
     (or share thereof) by the end of the calendar month in which 
     the digital music provider first makes use of the work, the 
     digital music provider shall provide statements of account 
     and pay royalties to such copyright owner in accordance with 
     this section and applicable regulations.
       ``(iv) If the copyright owner is not identified or located 
     by the end of the calendar month in which the digital music 
     provider first makes use of the work, the digital music 
     provider shall accrue and hold royalties calculated under the 
     applicable statutory rate in accordance with usage of the 
     work, from initial use of the work until the accrued 
     royalties can be paid to the copyright owner or are required 
     to be transferred to the mechanical licensing collective, as 
     follows:

       ``(I) Accrued royalties shall be maintained by the digital 
     music provider in accordance with generally accepted 
     accounting principles.
       ``(II) If a copyright owner of an unmatched musical work 
     (or share thereof) is identified and located by or to the 
     digital music provider before the license availability date, 
     the digital music provider shall--

       ``(aa) within 45 calendar days after the end of the 
     calendar month during which the copyright owner was 
     identified and located, pay the copyright owner all accrued 
     royalties, such payment to be accompanied by a cumulative 
     statement of account that includes all of the information 
     that would have been provided to the copyright owner had

[[Page H3531]]

     the digital music provider been providing monthly statements 
     of account to the copyright owner from initial use of the 
     work in accordance with this section and applicable 
     regulations, including the requisite certification under 
     subsection (c)(2)(I);
       ``(bb) beginning with the accounting period following the 
     calendar month in which the copyright owner was identified 
     and located, and for all other accounting periods prior to 
     the license availability date, provide monthly statements of 
     account and pay royalties to the copyright owner as required 
     under this section and applicable regulations; and
       ``(cc) beginning with the monthly royalty reporting period 
     commencing on the license availability date, report usage and 
     pay royalties for such musical work (or share thereof) for 
     such reporting period and reporting periods thereafter to the 
     mechanical licensing collective, as required under this 
     subsection and applicable regulations.

       ``(III) If a copyright owner of an unmatched musical work 
     (or share thereof) is not identified and located by the 
     license availability date, the digital music provider shall--

       ``(aa) within 45 calendar days after the license 
     availability date, transfer all accrued royalties to the 
     mechanical licensing collective, such payment to be 
     accompanied by a cumulative statement of account that 
     includes all of the information that would have been provided 
     to the copyright owner had the digital music provider been 
     serving monthly statements of account on the copyright owner 
     from initial use of the work in accordance with this section 
     and applicable regulations, including the requisite 
     certification under subsection (c)(2)(I), and accompanied by 
     an additional certification by a duly authorized officer of 
     the digital music provider that the digital music provider 
     has fulfilled the requirements of clauses (i) and (ii) of 
     subparagraph (B) but has not been successful in locating or 
     identifying the copyright owner; and
       ``(bb) beginning with the monthly royalty reporting period 
     commencing on the license availability date, report usage and 
     pay royalties for such musical work (or share thereof) for 
     such period and reporting periods thereafter to the 
     mechanical licensing collective, as required under this 
     subsection and applicable regulations.
       ``(v) Suspension of late fees.--A digital music provider 
     that complies with the requirements of this paragraph with 
     respect to unmatched musical works (or shares of works) shall 
     not be liable for or accrue late fees for late payments of 
     royalties for such works until such time as the digital music 
     provider is required to begin paying monthly royalties to the 
     copyright owner or the mechanical licensing collective, as 
     applicable.
       ``(C) Adjusted statute of limitations.--Notwithstanding 
     anything to the contrary in section 507(b), with respect to 
     any claim of infringement of the exclusive rights provided by 
     paragraphs (1) and (3) of section 106 against a digital music 
     provider arising from the unauthorized reproduction or 
     distribution of a musical work by such digital music provider 
     to engage in covered activities that accrued no more than 3 
     years prior to the license availability date, such action may 
     be commenced within 3 years of the date the claim accrued, or 
     up to 2 years after the license availability date, whichever 
     is later.
       ``(D) Other rights and remedies preserved.--Except as 
     expressly provided in this paragraph, nothing in this 
     paragraph shall be construed to alter, limit, or negate any 
     right or remedy of a copyright owner with respect to 
     unauthorized use of a musical work.
       ``(11) Legal protections for licensing activities.--
       ``(A) Exemption for compulsory license activities.--The 
     antitrust exemption described in subsection (c)(1)(D) shall 
     apply to negotiations and agreements between and among 
     copyright owners and persons entitled to obtain a compulsory 
     license for covered activities, and common agents acting on 
     behalf of such copyright owners or persons, including with 
     respect to the administrative assessment established under 
     this subsection.
       ``(B) Limitation on common agent exemption.--
     Notwithstanding the antitrust exemption provided in 
     subsection (c)(1)(D) and subparagraph (A) (except for the 
     administrative assessment referenced therein and except as 
     provided in paragraph (8)(C)), neither the mechanical 
     licensing collective nor the digital licensee coordinator 
     shall serve as a common agent with respect to the 
     establishment of royalty rates or terms under this section.
       ``(C) Antitrust exemption for administrative activities.--
     Notwithstanding any provision of the antitrust laws, 
     copyright owners and persons entitled to obtain a compulsory 
     license under this section may designate the mechanical 
     licensing collective to administer voluntary licenses for the 
     reproduction or distribution of musical works in covered 
     activities on behalf of such copyright owners and persons, 
     but the following conditions apply:
       ``(i) Each copyright owner shall establish the royalty 
     rates and material terms of any such voluntary license 
     individually and not in agreement, combination, or concert 
     with any other copyright owner.
       ``(ii) Each person entitled to obtain a compulsory license 
     under this section shall establish the royalty rates and 
     material terms of any such voluntary license individually and 
     not in agreement, combination, or concert with any other 
     digital music provider.
       ``(iii) The mechanical licensing collective shall maintain 
     the confidentiality of the voluntary licenses in accordance 
     with the confidentiality provisions prescribed by the 
     Register of Copyrights under paragraph (12)(C).
       ``(D) Liability for good-faith activities.--The mechanical 
     licensing collective shall not be liable to any person or 
     entity based on a claim arising from its good-faith 
     administration of policies and procedures adopted and 
     implemented to carry out the responsibilities described in 
     subparagraphs (J) and (K) of paragraph (3), except to the 
     extent of correcting an underpayment or overpayment of 
     royalties as provided in paragraph (3)(L)(i)(VI), but the 
     collective may participate in a legal proceeding as a 
     stakeholder party if the collective is holding funds that are 
     the subject of a dispute between copyright owners. For 
     purposes of this subparagraph, `good-faith administration' 
     means administration in a manner that is not grossly 
     negligent.
       ``(E) Preemption of state property laws.--The holding and 
     distribution of funds by the mechanical licensing collective 
     in accordance with this subsection shall supersede and 
     preempt any State law (including common law) concerning 
     escheatment or abandoned property, or any analogous 
     provision, that might otherwise apply.
       ``(F) Rule of construction.--Except as expressly provided 
     in this subsection, nothing in this subsection shall negate 
     or limit the ability of any person to pursue an action in 
     Federal court against the mechanical licensing collective or 
     any other person based upon a claim arising under this title 
     or other applicable law.
       ``(12) Regulations.--
       ``(A) Adoption by register of copyrights and copyright 
     royalty judges.--The Register of Copyrights may conduct such 
     proceedings and adopt such regulations as may be necessary or 
     appropriate to effectuate the provisions of this subsection, 
     except for regulations concerning proceedings before the 
     Copyright Royalty Judges to establish the administrative 
     assessment, which shall be adopted by the Copyright Royalty 
     Judges.
       ``(B) Judicial review of regulations.--Except as provided 
     in paragraph (7)(D)(vii), regulations adopted under this 
     subsection shall be subject to judicial review pursuant to 
     chapter 7 of title 5.
       ``(C) Protection of confidential information.--The Register 
     of Copyrights shall adopt regulations to provide for the 
     appropriate procedures to ensure that confidential, private, 
     proprietary, or privileged information contained in the 
     records of the mechanical licensing collective and digital 
     licensee coordinator is not improperly disclosed or used, 
     including through any disclosure or use by the board of 
     directors or personnel of either entity, and specifically 
     including the unclaimed royalties oversight committee and the 
     dispute resolution committee of the mechanical licensing 
     collective.
       ``(13) Savings clauses.--
       ``(A) Limitation on activities and rights covered.--This 
     subsection applies solely to uses of musical works subject to 
     licensing under this section. The blanket license shall not 
     be construed to extend or apply to activities other than 
     covered activities or to rights other than the exclusive 
     rights of reproduction and distribution licensed under this 
     section, or serve or act as the basis to extend or expand the 
     compulsory license under this section to activities and 
     rights not covered by this section on the enactment date.
       ``(B) Rights of public performance not affected.--The 
     rights, protections, and immunities granted under this 
     subsection, the data concerning musical works collected and 
     made available under this subsection, and the definitions 
     described in subsection (e) shall not extend to, limit, or 
     otherwise affect any right of public performance in a musical 
     work.''; and
       (5) by adding at the end the following new subsection:
       ``(e) Definitions.--As used in this section:
       ``(1) Accrued interest.--The term `accrued interest' means 
     interest accrued on accrued royalties, as described in 
     subsection (d)(3)(H)(ii).
       ``(2) Accrued royalties.--The term `accrued royalties' 
     means royalties accrued for the reproduction or distribution 
     of a musical work (or share thereof) in a covered activity, 
     calculated in accordance with the applicable royalty rate 
     under this section.
       ``(3) Administrative assessment.--The term `administrative 
     assessment' means the fee established pursuant to subsection 
     (d)(7)(D).
       ``(4) Audit.--The term `audit' means a royalty compliance 
     examination to verify the accuracy of royalty payments, or 
     the conduct of such an examination, as applicable.
       ``(5) Blanket license.--The term `blanket license' means a 
     compulsory license described in subsection (d)(1)(A) to 
     engage in covered activities.
       ``(6) Collective total costs.--The term `collective total 
     costs'--
       ``(A) means the total costs of establishing, maintaining, 
     and operating the mechanical licensing collective to fulfill 
     its statutory functions, including--
       ``(i) startup costs;
       ``(ii) financing, legal, and insurance costs;
       ``(iii) investments in information technology, 
     infrastructure, and other long-term resources;
       ``(iv) outside vendor costs;

[[Page H3532]]

       ``(v) costs of licensing, royalty administration, and 
     enforcement of rights;
       ``(vi) costs of bad debt; and
       ``(vii) costs of automated and manual efforts to identify 
     and locate copyright owners of musical works (and shares of 
     such musical works) and match sound recordings to the musical 
     works the sound recordings embody; and
       ``(B) does not include any added costs incurred by the 
     mechanical licensing collective to provide services under 
     voluntary licenses.
       ``(7) Covered activity.--The term `covered activity' means 
     the activity of making a digital phonorecord delivery of a 
     musical work, including in the form of a permanent download, 
     limited download, or interactive stream, where such activity 
     qualified for a compulsory license under this section.
       ``(8) Digital music provider.--The term `digital music 
     provider' means a person (or persons operating under the 
     authority of that person) that, with respect to a service 
     engaged in covered activities--
       ``(A) has a direct contractual, subscription, or other 
     economic relationship with end users of the service, or, if 
     no such relationship with end users exists, exercises direct 
     control over the provision of the service to end users;
       ``(B) is able to fully report on any revenues and 
     consideration generated by the service; and
       ``(C) is able to fully report on usage of sound recordings 
     of musical works by the service (or procure such reporting).
       ``(9) Digital licensee coordinator.--The term `digital 
     licensee coordinator' means the entity most recently 
     designated pursuant to subsection (d)(5).
       ``(10) Digital phonorecord delivery.--The term `digital 
     phonorecord delivery' means each individual delivery of a 
     phonorecord by digital transmission of a sound recording that 
     results in a specifically identifiable reproduction by or for 
     any transmission recipient of a phonorecord of that sound 
     recording, regardless of whether the digital transmission is 
     also a public performance of the sound recording or any 
     musical work embodied therein, and includes a permanent 
     download, a limited download, or an interactive stream. A 
     digital phonorecord delivery does not result from a real-
     time, noninteractive subscription transmission of a sound 
     recording where no reproduction of the sound recording or the 
     musical work embodied therein is made from the inception of 
     the transmission through to its receipt by the transmission 
     recipient in order to make the sound recording audible. A 
     digital phonorecord delivery does not include the digital 
     transmission of sounds accompanying a motion picture or other 
     audiovisual work as defined in section 101 of this title.
       ``(11) Enactment date.--The term `enactment date' means the 
     date of the enactment of the Musical Works Modernization Act.
       ``(12) Individual download license.--The term `individual 
     download license' means a compulsory license obtained by a 
     record company to make and distribute, or authorize the 
     making and distribution of, permanent downloads embodying a 
     specific individual musical work.
       ``(13) Interactive stream.--The term `interactive stream' 
     means a digital transmission of a sound recording of a 
     musical work in the form of a stream, where the performance 
     of the sound recording by means of such transmission is not 
     exempt under section 114(d)(1) and does not in itself, or as 
     a result of a program in which it is included, qualify for 
     statutory licensing under section 114(d)(2). An interactive 
     stream is a digital phonorecord delivery.
       ``(14) Interested.--The term `interested', as applied to a 
     party seeking to participate in a proceeding under subsection 
     (d)(7)(D), is a party as to which the Copyright Royalty 
     Judges have not determined that the party lacks a significant 
     interest in such proceeding.
       ``(15) License availability date.--The term `license 
     availability date' means the next January 1 following the 
     expiration of the two-year period beginning on the enactment 
     date.
       ``(16) Limited download.--The term `limited download' means 
     a digital transmission of a sound recording of a musical work 
     in the form of a download, where such sound recording is 
     accessible for listening only for a limited amount of time or 
     specified number of times.
       ``(17) Matched.--The term `matched', as applied to a 
     musical work (or share thereof), means that the copyright 
     owner of such work (or share thereof) has been identified and 
     located.
       ``(18) Mechanical licensing collective.--The term 
     `mechanical licensing collective' means the entity most 
     recently designated as such by the Register of Copyrights 
     under subsection (d)(3).
       ``(19) Mechanical licensing collective budget.--The term 
     `mechanical licensing collective budget' means a statement of 
     the financial position of the mechanical licensing collective 
     for a fiscal year or quarter thereof based on estimates of 
     expenditures during the period and proposals for financing 
     them, including a calculation of the collective total costs.
       ``(20) Musical works database.--The term `musical works 
     database' means the database described in subsection 
     (d)(3)(E).
       ``(21) Nonprofit.--The term `nonprofit' means a nonprofit 
     created or organized in a State.
       ``(22) Notice of license.--The term `notice of license' 
     means a notice from a digital music provider provided under 
     subsection (d)(2)(A) for purposes of obtaining a blanket 
     license.
       ``(23) Notice of nonblanket activity.--The term `notice of 
     nonblanket activity' means a notice from a significant 
     nonblanket licensee provided under subsection (d)(6)(A) for 
     purposes of notifying the mechanical licensing collective 
     that the licensee has been engaging in covered activities.
       ``(24) Permanent download.--The term `permanent download' 
     means a digital transmission of a sound recording of a 
     musical work in the form of a download, where such sound 
     recording is accessible for listening without restriction as 
     to the amount of time or number of times it may be accessed.
       ``(25) Qualified auditor.--The term `qualified auditor' 
     means an independent, certified public accountant with 
     experience performing music royalty audits.
       ``(26) Record company.--The term `record company' means an 
     entity that invests in, produces, and markets sound 
     recordings of musical works, and distributes such sound 
     recordings for remuneration through multiple sales channels, 
     including a corporate affiliate of such an entity engaged in 
     distribution of sound recordings.
       ``(27) Report of usage.--The term `report of usage' means a 
     report reflecting an entity's usage of musical works in 
     covered activities described in subsection (d)(4)(A).
       ``(28) Required matching efforts.--The term `required 
     matching efforts' means efforts to identify and locate 
     copyright owners of musical works as described in subsection 
     (d)(10)(B)(i).
       ``(29) Service.--The term `service', as used in relation to 
     covered activities, means any site, facility, or offering by 
     or through which sound recordings of musical works are 
     digitally transmitted to members of the public.
       ``(30) Share.--The term `share', as applied to a musical 
     work, means a fractional ownership interest in such work.
       ``(31) Significant nonblanket licensee.--The term 
     `significant nonblanket licensee'--
       ``(A) means an entity, including a group of entities under 
     common ownership or control that, acting under the authority 
     of one or more voluntary licenses or individual download 
     licenses, offers a service engaged in covered activities, and 
     such entity or group of entities--
       ``(i) is not currently operating under a blanket license 
     and is not obligated to provide reports of usage reflecting 
     covered activities under subsection (d)(4)(A);
       ``(ii) has a direct contractual, subscription, or other 
     economic relationship with end users of the service or, if no 
     such relationship with end users exists, exercises direct 
     control over the provision of the service to end users; and
       ``(iii) either--

       ``(I) on any day in a calendar month, makes more than 5,000 
     different sound recordings of musical works available through 
     such service; or
       ``(II) derives revenue or other consideration in connection 
     with such covered activities greater than $50,000 in a 
     calendar month, or total revenue or other consideration 
     greater than $500,000 during the preceding 12 calendar 
     months; and

       ``(B) does not include--
       ``(i) an entity whose covered activity consists solely of 
     free-to-the-user streams of segments of sound recordings of 
     musical works that do not exceed 90 seconds in length, are 
     offered only to facilitate a licensed use of musical works 
     that is not a covered activity, and have no revenue directly 
     attributable to such streams constituting the covered 
     activity; or
       ``(ii) a `public broadcasting entity' as defined in section 
     118(f).
       ``(32) Songwriter.--The term `songwriter' means the author 
     of all or part of a musical work, including a composer or 
     lyricist.
       ``(33) State.--The term `State' means each State of the 
     United States, the District of Columbia, and each territory 
     or possession of the United States.
       ``(34) Unclaimed accrued royalties.--The term `unclaimed 
     accrued royalties' means accrued royalties eligible for 
     distribution under subsection (d)(3)(J).
       ``(35) Unmatched.--The term `unmatched', as applied to a 
     musical work (or share thereof), means that the copyright 
     owner of such work (or share thereof) has not been identified 
     or located.
       ``(36) Voluntary license.--The term `voluntary license' 
     means a license for use of a musical work (or share thereof) 
     other than a compulsory license obtained under this 
     section.''.
       (b) Technical and Conforming Amendments to Section 801.--
     Section 801(b) of title 17, United States Code, is amended--
       (1) by redesignating paragraph (8) as paragraph (9); and
       (2) by inserting after paragraph (7) the following new 
     paragraph:
       ``(8) To determine the administrative assessment to be paid 
     by digital music providers under section 115(d). The 
     provisions of section 115(d) shall apply to the conduct of 
     proceedings by the Copyright Royalty Judges under section 
     115(d) and not the procedures described in this section, or 
     section 803, 804, or 805.''.
       (c) Effective Date of Amended Rate Setting Standard.--The 
     amendments made by subsections (a)(3)(D) and (b)(1) shall 
     apply to any proceeding before the Copyright Royalty

[[Page H3533]]

     Judges that is pending on, or commenced on or after, the date 
     of the enactment of this Act.
       (d) Technical and Conforming Amendments to Title 37, Part 
     385 of the Code of Federal Regulations.--Within 9 months 
     after the date of the enactment of this Act, the Copyright 
     Royalty Judges shall amend the regulations for section 115 in 
     part 385 of title 37, Code of Federal Regulations to conform 
     the definitions used in such part to the definitions of the 
     same terms described in section 115(e) of title 17, United 
     States Code, as amended by subsection (a). In so doing, the 
     Copyright Royalty Judges shall make adjustments to the 
     language of the regulations as necessary to achieve the same 
     purpose and effect as the original regulations with respect 
     to the rates and terms previously adopted by the Copyright 
     Royalty Judges.

     SEC. 103. AMENDMENTS TO SECTION 114.

       (a) Uniform Rate Standard.--Section 114(f) of title 17, 
     United States Code, is amended--
       (1) by striking paragraphs (1) and (2) and inserting the 
     following:
       ``(1)(A) Proceedings under chapter 8 shall determine 
     reasonable rates and terms of royalty payments for 
     transmissions subject to statutory licensing under subsection 
     (d)(2) during the 5-year period beginning on January 1 of the 
     second year following the year in which the proceedings are 
     to be commenced pursuant to subparagraph (A) or (B) of 
     section 804(b)(3), as the case may be, or such other period 
     as the parties may agree. The parties to each proceeding 
     shall bear their own costs.
       ``(B) The schedule of reasonable rates and terms determined 
     by the Copyright Royalty Judges shall, subject to paragraph 
     (2), be binding on all copyright owners of sound recordings 
     and entities performing sound recordings affected by this 
     paragraph during the 5-year period specified in subparagraph 
     (A), or such other period as the parties may agree. Such 
     rates and terms shall distinguish among the different types 
     of services then in operation and shall include a minimum fee 
     for each such type of service, such differences to be based 
     on criteria including the quantity and nature of the use of 
     sound recordings and the degree to which use of the service 
     may substitute for or may promote the purchase of 
     phonorecords by consumers. The Copyright Royalty Judges shall 
     establish rates and terms that most clearly represent the 
     rates and terms that would have been negotiated in the 
     marketplace between a willing buyer and a willing seller. In 
     determining such rates and terms, the Copyright Royalty 
     Judges--
       ``(i) shall base their decision on economic, competitive, 
     and programming information presented by the parties, 
     including--
       ``(I) whether use of the service may substitute for or may 
     promote the sales of phonorecords or otherwise may interfere 
     with or may enhance the sound recording copyright owner's 
     other streams of revenue from the copyright owner's sound 
     recordings; and
       ``(II) the relative roles of the copyright owner and the 
     transmitting entity in the copyrighted work and the service 
     made available to the public with respect to relative 
     creative contribution, technological contribution, capital 
     investment, cost, and risk; and
       ``(ii) may consider the rates and terms for comparable 
     types of audio transmission services and comparable 
     circumstances under voluntary license agreements.
       ``(C) The procedures under subparagraphs (A) and (B) shall 
     also be initiated pursuant to a petition filed by any sound 
     recording copyright owner or any transmitting entity 
     indicating that a new type of service on which sound 
     recordings are performed is or is about to become 
     operational, for the purpose of determining reasonable terms 
     and rates of royalty payments with respect to such new type 
     of service for the period beginning with the inception of 
     such new type of service and ending on the date on which the 
     royalty rates and terms for eligible nonsubscription services 
     and new subscription services, or preexisting services, as 
     the case may be, most recently determined under subparagraph 
     (A) or (B) and chapter 8 expire, or such other period as the 
     parties may agree.''; and
       (2) by redesignating paragraphs (3), (4), and (5) as 
     paragraphs (2), (3), and (4), respectively.
       (b) Repeal.--Subsection (i) of section 114 of title 17, 
     United States Code, is repealed.
       (c) Use in Musical Work Proceedings.--
       (1) In general.--License fees payable for the public 
     performance of sound recordings under section 106(6) of title 
     17, United States Code, shall not be taken into account in 
     any administrative, judicial, or other governmental 
     proceeding to set or adjust the royalties payable to musical 
     work copyright owners for the public performance of their 
     works except in such a proceeding to set or adjust royalties 
     for the public performance of musical works by means of a 
     digital audio transmission other than a transmission by a 
     broadcaster, and may be taken into account only with respect 
     to such digital audio transmission.
       (2) Definitions.--In this subsection:
       (A) Transmission by a broadcaster.--A ``transmission by a 
     broadcaster'' means a nonsubscription digital transmission 
     made by a terrestrial broadcast station on its own behalf, or 
     on the behalf of a terrestrial broadcast station under common 
     ownership or control, that is not part of an interactive 
     service or a music-intensive service comprising the 
     transmission of sound recordings customized for or 
     customizable by recipients or service users.
       (B) Terrestrial broadcast station.--A ``terrestrial 
     broadcast station'' means a terrestrial, over-the-air radio 
     or television broadcast station, licensed as such by the 
     Federal Communications Commission, including an FM Translator 
     as defined in section 74.1231 of title 47, Code of Federal 
     Regulations, and whose primary business activities are 
     comprised of, and revenues are generated through, 
     terrestrial, over-the-air broadcast transmissions, or the 
     simultaneous or substantially-simultaneous digital 
     retransmission by the terrestrial, over-the-air broadcast 
     station of its over-the-air broadcast transmissions.
       (d) Rule of Construction.--Subsection (c)(2) shall not be 
     given effect in interpreting provisions of title 17, United 
     States Code.
       (e) Use in Sound Recording Proceedings.--The repeal of 
     section 114(i) of title 17, United States Code, by subsection 
     (b) shall not be taken into account in any proceeding to set 
     or adjust the rates and fees payable for the use of sound 
     recordings under section 112(e) or section 114(f) of such 
     title that is pending on, or commenced on or after, the date 
     of the enactment of this Act.
       (f) Decisions and Precedents Not Affected.--The repeal of 
     section 114(i) of title 17, United States Code, by subsection 
     (b) shall not have any effect upon the decisions, or the 
     precedents established or relied upon, in any proceeding to 
     set or adjust the rates and fees payable for the use of sound 
     recordings under section 112(e) or section 114(f) of such 
     title before the date of the enactment of this Act.
       (g) Technical and Conforming Amendments.--
       (1) Section 114.--Section 114(f) of title 17, United States 
     Code, as amended by subsection (a), is further amended in 
     paragraph (4)(C), as so redesignated, by striking ``under 
     paragraph (4)'' and inserting ``under paragraph (3)''.
       (2) Section 801.--Section 801(b)(1) of title 17, United 
     States Code, is amended by striking ``The rates applicable'' 
     and all that follows though ``prevailing industry 
     practices.''.
       (3) Section 804.--Section 804(b)(3)(C) of title 17, United 
     States Code, is amended--
       (A) in clause (i), by striking ``and 114(f)(2)(C)'';
       (B) in clause (iii)(II), by striking ``114(f)(4)(B)(ii)'' 
     and inserting ``114(f)(3)(B)(ii)''; and
       (C) in clause (iv), by striking ``or 114(f)(2)(C), as the 
     case may be''.

     SEC. 104. RANDOM ASSIGNMENT OF RATE COURT PROCEEDINGS.

       Section 137 of title 28, United States Code, is amended--
       (1) by striking ``The business'' and inserting ``(a) In 
     General.--The business''; and
       (2) by adding at the end the following new subsection:
       ``(b) Random Assignment of Rate Court Proceedings.--
       ``(1) In general.--
       ``(A) Determination of license fee.--Except as provided in 
     subparagraph (B), in the case of any performing rights 
     society subject to a consent decree, any application for the 
     determination of a license fee for the public performance of 
     music in accordance with the applicable consent decree shall 
     be made in the district court with jurisdiction over that 
     consent decree and randomly assigned to a judge of that 
     district court according to that court's rules for the 
     division of business among district judges currently in 
     effect or as may be amended from time to time, provided that 
     any such application shall not be assigned to--
       ``(i) a judge to whom continuing jurisdiction over any 
     performing rights society for any performing rights society 
     consent decree is assigned or has previously been assigned; 
     or
       ``(ii) a judge to whom another proceeding concerning an 
     application for the determination of a reasonable license fee 
     is assigned at the time of the filing of the application.
       ``(B) Exception.--Subparagraph (A) does not apply to an 
     application to determine reasonable license fees made by 
     individual proprietors under section 513 of title 17.
       ``(2) Rule of construction.--Nothing in paragraph (1) shall 
     modify the rights of any party to a consent decree or to a 
     proceeding to determine reasonable license fees, to make an 
     application for the construction of any provision of the 
     applicable consent decree. Such application shall be referred 
     to the judge to whom continuing jurisdiction over the 
     applicable consent decree is currently assigned. If any such 
     application is made in connection with a rate proceeding, 
     such rate proceeding shall be stayed until the final 
     determination of the construction application. Disputes in 
     connection with a rate proceeding about whether a licensee is 
     similarly situated to another licensee shall not be subject 
     to referral to the judge with continuing jurisdiction over 
     the applicable consent decree.''.

  TITLE II--COMPENSATING LEGACY ARTISTS FOR THEIR SONGS, SERVICE, AND 
                   IMPORTANT CONTRIBUTIONS TO SOCIETY

     SEC. 201. SHORT TITLE.

       This title may be cited as the ``Compensating Legacy 
     Artists for their Songs, Service, and Important Contributions 
     to Society Act'' or the ``CLASSICS Act''.

[[Page H3534]]

  


     SEC. 202. UNAUTHORIZED DIGITAL PERFORMANCE OF PRE-1972 SOUND 
                   RECORDINGS.

       (a) Protection for Unauthorized Digital Performances.--
     Title 17, United States Code, is amended by adding at the end 
     the following new chapter:

   ``CHAPTER 14--UNAUTHORIZED DIGITAL PERFORMANCE OF PRE-1972 SOUND 
                               RECORDINGS

``Sec.
``1401. Unauthorized digital performance of pre-1972 sound recordings.

     ``Sec. 1401. Unauthorized digital performance of pre-1972 
       sound recordings

       ``(a) Unauthorized Acts.--Anyone who, before February 15, 
     2067, and without the consent of the rights owner, performs 
     publicly, by means of a digital audio transmission, a sound 
     recording fixed on or after January 1, 1923, and before 
     February 15, 1972, shall be subject to the remedies provided 
     in sections 502 through 505 to the same extent as an 
     infringer of copyright.
       ``(b) Certain Authorized Transmissions.--A digital audio 
     transmission of a sound recording fixed on or after January 
     1, 1923, and before February 15, 1972, shall, for purposes of 
     subsection (a), be considered to be authorized and made with 
     the consent of the rights owner if--
       ``(1) the transmission is made by a transmitting entity 
     that is publicly performing sound recordings fixed on or 
     after February 15, 1972, by means of digital audio 
     transmissions subject to section 114;
       ``(2) the transmission would satisfy the requirements for 
     statutory licensing under section 114(d)(2), or would be 
     exempt under section 114(d)(1), if the sound recording were 
     fixed on or after February 15, 1972;
       ``(3) in the case of a transmission that would not be 
     exempt under section 114(d)(1) as described in paragraph (2), 
     the transmitting entity pays statutory royalties and provides 
     notice of its use of the relevant sound recordings in the 
     same manner as is required by regulations adopted by the 
     Copyright Royalty Judges for sound recordings fixed on or 
     after February 15, 1972; and
       ``(4) in the case of a transmission that would not be 
     exempt under section 114(d)(1) as described in paragraph (2), 
     the transmitting entity otherwise satisfies the requirements 
     for statutory licensing under section 114(f)(4)(B).
       ``(c) Transmissions by Direct Licensing of Statutory 
     Services.--
       ``(1) In general.--A transmission of a sound recording 
     fixed on or after January 1, 1923, and before February 15, 
     1972, shall, for purposes of subsection (a), be considered to 
     be authorized and made with the consent of the rights owner 
     if such transmission is included in a license agreement 
     voluntarily negotiated at any time between the rights owner 
     and the entity performing the sound recording.
       ``(2) Payment of royalties to nonprofit collective.--To the 
     extent that such a license agreement entered into on or after 
     the date of the enactment of this section extends to digital 
     audio transmissions of a sound recording fixed on or after 
     January 1, 1923, and before February 15, 1972, that meet the 
     conditions of subsection (b), the licensee shall pay, to the 
     collective designated to distribute receipts from the 
     licensing of transmissions in accordance with section 114(f), 
     50 percent of the performance royalties for the transmissions 
     due under the license, with such royalties fully credited as 
     payments due under the license.
       ``(3) Distribution of royalties by collective.--The 
     collective described in paragraph (2) shall, in accordance 
     with subparagraphs (B) through (D) of section 114(g)(2), and 
     paragraphs (5) and (6) of section 114(g)), distribute the 
     royalties received under paragraph (2) under the license 
     described in paragraph (2). Such payments shall be the only 
     payments to which featured and nonfeatured artists are 
     entitled by virtue of the transmissions described in 
     paragraph (2) under the license.
       ``(4) Rule of construction.--This section does not prohibit 
     any other license from directing the licensee to pay other 
     royalties due to featured and nonfeatured artists for such 
     transmissions to the collective designated to distribute 
     receipts from the licensing of transmissions in accordance 
     with section 114(f).
       ``(d) Relationship to State Law.--
       ``(1) In general.--Nothing in this section shall be 
     construed to annul or limit any rights or remedies under the 
     common law or statutes of any State for sound recordings 
     fixed before February 15, 1972, except, notwithstanding 
     section 301(c), for the following:
       ``(A) This section preempts any claim of common law 
     copyright or equivalent right under the laws of any State 
     arising from any digital audio transmission that is made, on 
     and after the date of the enactment of this section, of a 
     sound recording fixed on or after January 1, 1923, and before 
     February 15, 1972.
       ``(B) This section preempts any claim of common law 
     copyright or equivalent right under the laws of any State 
     arising from any reproduction that is made, on and after the 
     date of the enactment of this section, of a sound recording 
     fixed on or after January 1, 1923, and before February 15, 
     1972, and that would satisfy the requirements for statutory 
     licensing under paragraphs (1) and (6) of section 112(e), if 
     the sound recording were fixed on or after February 15, 1972.
       ``(C) This section preempts any claim of common law 
     copyright or equivalent right under the laws of any State 
     arising from any digital audio transmission or reproduction 
     that is made, before the date of the enactment of this 
     section, of a sound recording fixed on or after January 1, 
     1923, and before February 15, 1972, if--
       ``(i) the digital audio transmission would have satisfied 
     the requirements for statutory licensing under section 
     114(d)(2) or been exempt under section 114(d)(1), or the 
     reproduction would have satisfied the requirements of section 
     112(e)(1), as the case may be, if the sound recording were 
     fixed on or after February 15, 1972; and
       ``(ii) except in the case of transmissions that would have 
     been exempt under section 114(d)(1), the transmitting entity, 
     before the end of the 270-day period beginning on the date of 
     the enactment of this section, pays statutory royalties and 
     provides notice of the use of the relevant sound recordings 
     in the same manner as is required by regulations adopted by 
     the Copyright Royalty Judges for sound recordings that are 
     protected under this title for all the digital audio 
     transmissions and reproductions satisfying the requirements 
     for statutory licensing under section 114(d)(2) and section 
     112(e)(1) during the 3 years prior to the date of the 
     enactment of this section.
       ``(2) Rule of construction for common law copyright.--For 
     purposes of subparagraphs (A) through (C) of paragraph (1), a 
     claim of common law copyright or equivalent right under the 
     laws of any State includes a claim that characterizes conduct 
     subject to such subparagraphs as an unlawful distribution, 
     act of record piracy, or similar violation.
       ``(3) Rule of construction for public performance rights.--
     Nothing in this section shall be construed to recognize or 
     negate the existence of public performance rights in sound 
     recordings under the laws of any State.
       ``(e) Limitations on Remedies.--
       ``(1) Fair use; uses by libraries, archives, and 
     educational institutions.--The limitations on the exclusive 
     rights of a copyright owner described in sections 107, 108, 
     and 110(1) and (2) shall apply to a claim under subsection 
     (a) for the unauthorized performance of a sound recording 
     fixed on or after January 1, 1923, and before February 15, 
     1972.
       ``(2) Actions.--The limitations on actions described in 
     section 507 shall apply to a claim under subsection (a) for 
     the unauthorized performance of a sound recording fixed on or 
     after January 1, 1923, and before February 15, 1972.
       ``(3) Material online.--Section 512 shall apply to a claim 
     under subsection (a) for the unauthorized performance of a 
     sound recording fixed on or after January 1, 1923, and before 
     February 15, 1972.
       ``(4) Principles of equity.--Principles of equity apply to 
     remedies for a violation of this section to the same extent 
     as such principles apply to remedies for infringement of 
     copyright.
       ``(5) Filing requirement for statutory damages and 
     attorneys' fees.--
       ``(A) Filing of information on sound recordings.--
       ``(i) Filing requirement.--Except in the case of a 
     transmitting entity that has filed contact information for 
     that transmitting entity under subparagraph (B), in any 
     action under this section, an award of statutory damages or 
     of attorneys' fees under section 504 or 505 may be made with 
     respect to an unauthorized transmission of a sound recording 
     under subsection (a) only if--

       ``(I) the rights owner has filed with the Copyright Office 
     a schedule that specifies the title, artist, and rights owner 
     of the sound recording and contains such other information, 
     as practicable, as the Register of Copyrights prescribes by 
     regulation; and
       ``(II) the transmission is made after the end of the 90-day 
     period beginning on the date on which the information filed 
     under subclause (I) is indexed into the public records of the 
     Copyright Office.

       ``(ii) Regulations.--The Register of Copyrights shall, 
     before the end of the 180-day period beginning on the date of 
     the enactment of this section, issue regulations establishing 
     the form, content, and procedures for the filing of schedules 
     under clause (i). Such regulations shall provide that persons 
     may request that they receive timely notification of such 
     filings, and shall set forth the manner in which such 
     requests may be made.
       ``(B) Filing of contact information for transmitting 
     entities.--
       ``(i) Filing requirement.--The Register of Copyrights 
     shall, before the end of the 30-day period beginning on the 
     date of the enactment of this section, issue regulations 
     establishing the form, content, and procedures for the 
     filing, by any entity that, as of the date of the enactment 
     of this section, performs sound recordings fixed before 
     February 15, 1972, by means of digital audio transmissions, 
     of contact information for such entity.
       ``(ii) Time limit on filings.--The Register of Copyrights 
     may accept filings under clause (i) only until the 180th day 
     after the date of the enactment of this section.
       ``(iii) Limitation on statutory damages and attorneys' 
     fees.--

       ``(I) Limitation.--An award of statutory damages or of 
     attorneys' fees under section 504 or 505 may not be made, 
     against an entity that has filed contact information for that 
     entity under clause (i), with respect to an unauthorized 
     transmission by that entity of a sound recording under 
     subsection (a) if the transmission is made before the end of 
     the

[[Page H3535]]

     90-day period beginning on the date on which the entity 
     receives a notice that--

       ``(aa) is sent by or on behalf of the rights owner of the 
     sound recording;
       ``(bb) states that the entity is not legally authorized to 
     transmit that sound recording under subsection (a); and
       ``(cc) identifies the sound recording in a schedule 
     conforming to the requirements prescribed by the regulations 
     issued under subparagraph (A)(ii).

       ``(II) Undeliverable notices.--In any case in which a 
     notice under subclause (I) is sent to an entity by mail or 
     courier service and the notice is returned to the sender 
     because the entity either is no longer located at the address 
     provided in the contact information filed under clause (i) or 
     has refused to accept delivery, or the notice is sent by 
     electronic mail and is undeliverable, the 90-day period under 
     subclause (I) shall begin on the date of the attempted 
     delivery.

       ``(C) Section 412.--Section 412 shall not limit an award of 
     statutory damages under section 504(c) or attorneys' fees 
     under section 505 with respect to an unauthorized 
     transmission of a sound recording under subsection (a).
       ``(6) Applicability of other provisions.--
       ``(A) In general.--Subject to subparagraph (B), no 
     provision of this title shall apply to or limit the remedies 
     available under this section except as otherwise provided in 
     this section.
       ``(B) Applicability of definitions.--Any term used in this 
     section that is defined in section 101 shall have the meaning 
     given that term in section 101.
       ``(f) Application of Section 230 Safe Harbor.--For purposes 
     of section 230 of the Communications Act of 1934 (47 U.S.C. 
     230), subsection (a) shall be considered to be a `law 
     pertaining to intellectual property' under subsection (e)(2) 
     of such section.
       ``(g) Rights Owner Defined.--In this section, the term 
     `rights owner' means the person who has the exclusive right 
     to reproduce a sound recording under the laws of any 
     State.''.
       (b) Conforming Amendment.--The table of chapters for title 
     17, United States Code, is amended by adding at the end the 
     following new chapter:

``14. Unauthorized digital performance of pre-1972 sound rec1401''.....

     SEC. 203. EFFECTIVE DATE.

       This title and the amendments made by this title shall take 
     effect on the date of the enactment of this Act.

               TITLE III--ALLOCATION FOR MUSIC PRODUCERS

     SEC. 301. SHORT TITLE.

       This title may be cited as the ``Allocation for Music 
     Producers Act'' or the ``AMP Act''.

     SEC. 302. PAYMENT OF STATUTORY PERFORMANCE ROYALTIES.

       (a) Letter of Direction.--Section 114(g) of title 17, 
     United States Code, is amended by adding at the end the 
     following new paragraph:
       ``(5) Letter of direction.--
       ``(A) In general.--A nonprofit collective designated by the 
     Copyright Royalty Judges to distribute receipts from the 
     licensing of transmissions in accordance with subsection (f) 
     shall adopt and reasonably implement a policy that provides, 
     in circumstances determined by the collective to be 
     appropriate, for acceptance of instructions from an artist 
     payee identified under subparagraph (A) or (D) of paragraph 
     (2) to distribute, to a producer, mixer, or sound engineer 
     who was part of the creative process that created a sound 
     recording, a portion of the payments to which the artist 
     payee would otherwise be entitled from the licensing of 
     transmissions of the sound recording. In this section, such 
     instructions shall be referred to as a `letter of direction'.
       ``(B) Acceptance of letter.--To the extent that the 
     collective accepts a letter of direction under subparagraph 
     (A), the person entitled to payment pursuant to the letter of 
     direction shall, during the period in which the letter of 
     direction is in effect and carried out by the collective, be 
     treated for all purposes as the owner of the right to receive 
     such payment, and the artist payee providing the letter of 
     direction to the collective shall be treated as having no 
     interest in such payment.
       ``(C) Authority of collective.--This paragraph shall not be 
     construed in such a manner so that the collective is not 
     authorized to accept or act upon payment instructions in 
     circumstances other than those to which this paragraph 
     applies.''.
       (b) Additional Provisions for Recordings Fixed Before 
     November 1, 1995.--Section 114(g) of title 17, United States 
     Code, as amended by subsection (a), is further amended by 
     adding at the end the following new paragraph:
       ``(6) Sound recordings fixed before november 1, 1995.--
       ``(A) Payment absent letter of direction.--A nonprofit 
     collective designated by the Copyright Royalty Judges to 
     distribute receipts from the licensing of transmissions in 
     accordance with subsection (f) (in this paragraph referred to 
     as the `collective') shall adopt and reasonably implement a 
     policy that provides, in circumstances determined by the 
     collective to be appropriate, for the deduction of 2 percent 
     of all the receipts that are collected from the licensing of 
     transmissions of a sound recording fixed before November 1, 
     1995, but which is withdrawn from the amount otherwise 
     payable under paragraph (2)(D) to the recording artist or 
     artists featured on the sound recording (or the persons 
     conveying rights in the artists' performance in the sound 
     recording), and the distribution of such amount to one or 
     more persons described in subparagraph (B), after deduction 
     of costs described in paragraph (3) or (4), as applicable, if 
     each of the following requirements is met:
       ``(i) Certification of attempt to obtain a letter of 
     direction.--The person described in subparagraph (B) who is 
     to receive the distribution has certified to the collective, 
     under penalty of perjury, that--

       ``(I) for a period of at least 4 months, that person made 
     reasonable efforts to contact the artist payee for such sound 
     recording to request and obtain a letter of direction 
     instructing the collective to pay to that person a portion of 
     the royalties payable to the featured recording artist or 
     artists; and
       ``(II) during the period beginning on the date that person 
     began the reasonable efforts described in subclause (I) and 
     ending on the date of that person's certification to the 
     collective, the artist payee did not affirm or deny in 
     writing the request for a letter of direction.

       ``(ii) Collective attempt to contact artist.--After receipt 
     of the certification described in clause (i) and for a period 
     of at least 4 months before the collective's first 
     distribution to the person described in subparagraph (B), the 
     collective attempted, in a reasonable manner as determined by 
     the collective, to notify the artist payee of the 
     certification made by the person described in subparagraph 
     (B).
       ``(iii) No objection received.--The artist payee did not, 
     as of the date that is 10 business days before the date on 
     which the first distribution is made, submit to the 
     collective in writing an objection to the distribution.
       ``(B) Eligibility for payment.--A person shall be eligible 
     for payment under subparagraph (A) if the person--
       ``(i) is a producer, mixer, or sound engineer of the sound 
     recording;
       ``(ii) has entered into a written contract with a record 
     company involved in the creation or lawful exploitation of 
     the sound recording, or with the recording artist or artists 
     featured on the sound recording (or the persons conveying 
     rights in the artists' performance in the sound recording), 
     under which the person seeking payment is entitled to 
     participate in royalty payments that are based on the 
     exploitation of the sound recording and are payable from 
     royalties otherwise payable to the recording artist or 
     artists featured on the sound recording (or the persons 
     conveying rights in the artists' performance in the sound 
     recording);
       ``(iii) made a creative contribution to the creation of the 
     sound recording; and
       ``(iv) submits a written certification to the collective 
     stating, under penalty of perjury, that the person meets the 
     requirements in clauses (i) through (iii) and includes a true 
     copy of the contract described in clause (ii).
       ``(C) Multiple certifications.--Subject to subparagraph 
     (D), in a case in which more than one person described in 
     subparagraph (B) has met the requirements for a distribution 
     under subparagraph (A) with respect to a sound recording as 
     of the date that is 10 business days before the date on which 
     a distribution is made, the collective shall divide the 2 
     percent distribution equally among all such persons.
       ``(D) Objection to payment.--Not later than 10 business 
     days after the date on which the collective receives from the 
     artist payee a written objection to a distribution made 
     pursuant to subparagraph (A), the collective shall cease 
     making any further payment relating to such distribution. In 
     any case in which the collective has made one or more 
     distributions pursuant to subparagraph (A) to a person 
     described in subparagraph (B) before the date that is 10 
     business days after the date on which the collective receives 
     from the artist payee an objection to such distribution, the 
     objection shall not affect that person's entitlement to any 
     distribution made before the collective ceases such 
     distribution under this subparagraph.
       ``(E) Ownership of the right to receive payments.--To the 
     extent that the collective determines that a distribution 
     will be made under subparagraph (A) to a person described in 
     subparagraph (B), such person shall, during the period 
     covered by such distribution, be treated for all purposes as 
     the owner of the right to receive such payments, and the 
     artist payee to whom such payments would otherwise be payable 
     shall be treated as having no interest in such payments.
       ``(F) Artist payee defined.--In this paragraph, the term 
     `artist payee' means a person, other than a person described 
     in subparagraph (B), who owns the right to receive all or 
     part of the receipts payable under paragraph (2)(D) with 
     respect to a sound recording. In a case in which there are 
     multiple artist payees with respect to a sound recording, an 
     objection by one such payee shall apply only to that payee's 
     share of the receipts payable under paragraph (2)(D), and 
     does not preclude payment under subparagraph (A) from the 
     share of an artist payee that does not so object.''.
       (c) Technical and Conforming Amendments.--Section 114(g) of 
     title 17, United States Code, as amended by subsections (a) 
     and (b), is further amended--
       (1) in paragraph (2), by striking ``An agent designated'' 
     and inserting ``Except as provided for in paragraph (6), a 
     nonprofit collective designated by the Copyright Royalty 
     Judges'';

[[Page H3536]]

       (2) in paragraph (3)--
       (A) by striking ``nonprofit agent designated'' and 
     inserting ``nonprofit collective designated by the Copyright 
     Royalty Judges'';
       (B) by striking ``another designated agent'' and inserting 
     ``another designated nonprofit collective''; and
       (C) by striking ``agent'' and inserting ``collective'' each 
     subsequent place it appears;
       (3) in paragraph (4)--
       (A) by striking ``designated agent'' and inserting 
     ``nonprofit collective''; and
       (B) by striking ``agent'' and inserting ``collective'' each 
     subsequent place it appears; and
       (4) by adding at the end the following new paragraph:
       ``(7) Preemption of state property laws.--The holding and 
     distribution of receipts under section 112 and this section 
     by a nonprofit collective designated by the Copyright Royalty 
     Judges in accordance with this subsection and regulations 
     adopted by the Copyright Royalty Judges shall supersede and 
     preempt any State law (including common law) concerning 
     escheatment or abandoned property, or any analogous 
     provision, that might otherwise apply.''.

     SEC. 303. EFFECTIVE DATE.

       (a) In General.--Except as provided in subsection (b), this 
     title and the amendments made by this title shall take effect 
     on the date of the enactment of this Act.
       (b) Delayed Effective Date.--The effective date for 
     paragraphs (5)(B) and (6)(E) of section 114(g) of title 17, 
     United States Code, as added by section 302, shall be January 
     1, 2020.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Virginia (Mr. Goodlatte) and the gentleman from New York (Mr. Nadler) 
each will control 20 minutes.
  The Chair recognizes the gentleman from Virginia.


                             General Leave

  Mr. GOODLATTE. Mr. Speaker, I ask unanimous consent that all Members 
may have 5 legislative days within which to revise and extend their 
remarks and include extraneous materials on H.R. 5447, currently under 
consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Virginia?
  There was no objection.
  Mr. GOODLATTE. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, today, the House brings early 20th century music laws 
for the analog era into the 21st century digital era. These changes are 
a culmination of years of effort by interested parties as well as by 
many members of the Judiciary Committee.
  The problems and failures in our Nation's music laws have imposed 
real financial costs upon artists and creators. Music is no longer 
written on piano rolls and our laws shouldn't be based on that 
technology any longer either.
  Several years ago, the Judiciary Committee began a comprehensive 
review of our Nation's copyright laws. We held dozens of hearings, 
heard from over 100 witnesses, and traveled to multiple cities across 
the country to hear directly from stakeholders who use these laws. This 
review provided the foundation upon which several bills to reform our 
copyright laws were constructed.
  During the course of this review, we learned that our music licensing 
laws were no longer working as intended for songwriters, artists, and 
creators, or for the companies that deliver the music in innovative 
ways for consumers.
  Specifically, we have heard about several key problems, including a 
dysfunctional mechanical licensing system that seems to generate more 
paperwork and attorneys' fees than royalties; a need to provide 
protection for pre-1972 performances; a lack of recognition in the law 
for the creative input of producers, sound engineers, and mixers; and a 
lack of a unified rate standard for music royalties.
  The Judiciary Committee regularly hears from a variety of groups 
interested in copyright law, and it will not surprise anyone to know 
that, typically, not everyone agrees regarding what changes to title 17 
are necessary. One person's problem may be another's benefit, and some 
have preferred a broken system over an unknown change.
  However, in a reflection of how bad our music statutes are, the 
opposite is true with respect to the bill before us today. Every party 
that has spoken about music recognizes the problems caused by our 
current licensing framework and wants real solutions. The existing 
music provisions of title 17 are simply that bad.
  I tasked the industry to come together with a unified reform bill 
and, to their credit, they delivered, albeit with an occasional bump 
along the way. Today, the major players in the music industry are 
unified in supporting comprehensive music licensing reform to bring the 
state of our Nation's copyright laws into the digital age that the 
industry itself has already transitioned to.
  While no bill is perfect, by all accounts, this is a bill with 
overwhelming consensus behind it. Groups that represent songwriters, 
musical works copyright owners, digital music providers, individual 
artists, sound recording copyright owners, artist guilds, and 
performing rights organizations all support the bill.
  The reasons for such widespread support are clear:
  The Music Modernization Act boosts payments for copyright owners and 
artists by shifting the reasonable costs of a new mechanical licensing 
collective onto digital music services that, themselves, benefit from 
reduced litigation costs as a result of other provisions in the bill.
  Songwriters gain a seat at the table in seeing how their royalties 
are collected and then allocated.
  Pre-1972 artists who currently go unpaid will finally see royalties 
for their creations, as will sound engineers, mixers, and producers. 
The public benefits, too, by having immediate access to all music on 
their favorite services. Furthermore, libraries and archives gain 
educational and fair use access to pre-1972 works currently governed 
under State law.
  This bill is the work product of many stakeholders and many Members. 
I want to highlight the work of several of my colleagues, including the 
ranking member, who were leaders in working on the underlying 
components of this bill.
  I want to especially thank Mr. Collins and Mr. Jeffries for their 
leadership on section 115 reform. I would like to thank Mr. Issa and 
Mr. Nadler for their leadership on behalf of pre-1972 performers. I 
would also like to thank Mr. Crowley and Mr. Rooney for their efforts 
on behalf of producers, mixers, and sound engineers.
  And last but not least, I would like to thank Ranking Member Nadler 
for his leadership on these issues and for his willingness to partner 
with me in putting these pieces together into a comprehensive and 
consensus music licensing reform package.
  Sometimes big pieces of legislation can come together only through 
the efforts of a large number of people who invest their time in making 
change happen, as so many Members and so many stakeholders in the music 
and digital delivery communities have done. It also has to happen at 
the right time.
  I would note that only 1 week ago, GRAMMYs on the Hill brought 
hundreds of artists to D.C. to explain to their own Members of Congress 
how important an updated licensing system is to them. This bill 
delivers that for them just 1 day before World Intellectual Property 
Day, when we recognize the value of intellectual property and those who 
create it. So I am on safe ground when I say that this bill fits right 
into the perfect sweet spot on both timing and substance.
  Mr. Speaker, I urge my colleagues to support this important piece of 
legislation, and I reserve the balance of my time.

  Mr. NADLER. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise in support of the Music Modernization Act. I am 
proud to partner with Chairman Goodlatte on this comprehensive bill 
intended to resolve some longstanding inequities and inefficiencies in 
the music marketplace. We have achieved consensus on this bill, which 
passed out of the Judiciary Committee by a remarkable vote of 32-0.
  The package includes the original Music Modernization Act, H.R. 4706, 
introduced by Mr. Collins and Mr. Jeffries, which significantly reforms 
the process for licensing mechanical reproduction royalties under 
section 115 of the Copyright Act. It also includes a number of 
provisions to ensure that songwriters and other music creators receive 
fair market value for their work.
  The package includes the CLASSICS Act, H.R. 3301, introduced by 
Chairman

[[Page H3537]]

Issa and me, to resolve the dispute over payment to legacy artists for 
pre-1972 works played on digital radio platforms.
  For too long, many of our Nation's great cultural icons have been 
unfairly denied compensation. That is why this measure is supported by 
the NAACP and more than 300 major artists.
  The bill includes the AMP Act, H.R. 831, introduced by Mr. Crowley 
and Mr. Rooney, to simplify the payment of royalties to producers, 
mixers, and engineers, recognizing in Federal copyright their important 
contributions to the creation of music.
  Several of these measures were included in the Fair Play Fair Pay 
Act, H.R. 1836, a bipartisan bill I introduced with Representative 
Marsha Blackburn, Chairman Issa, and Mr. Deutch, to create a uniform 
system for sound recordings. They, along with Mr. Collins and Mr. 
Jeffries, deserve a tremendous amount of credit for getting us to this 
point.
  We are at a unique moment in time where virtually all the industry 
stakeholders have come together in support of a common music policy 
agenda. The bill is supported by a broad coalition that includes 
songwriters and artists, publishers and labels, and internet and 
digital media companies such as Pandora, Spotify, Google, and Amazon.
  I want to thank the members of my staff who worked for years to 
resolve some very complex and sensitive issues to move this legislation 
forward: Lisette Morton, Jason Everett, and David Greengrass. This is 
an historic opportunity to accomplish a great deal that hasn't been 
done in decades.
  Mr. Speaker, I urge all of my colleagues to support the Music 
Modernization Act, and I reserve the balance of my time.

                              {time}  1415

  Mr. GOODLATTE. Mr. Speaker, I yield 5 minutes to the gentleman from 
Georgia (Mr. Collins), a member of the Judiciary Committee and a key 
legislator in making sure that this legislation moves forward. He has 
worked very, very hard on it.
  Mr. COLLINS of Georgia. Mr. Speaker, I rise today in support of H.R. 
5447, the Music Modernization Act.
  It has already been said that this bill combines critical pieces of 
legislation to update our laws, including legislation that I authored, 
the Music Modernization Act, but it also represents the CLASSICS Act, 
the AMP Act, and rate standardization, things that have been negotiated 
for a long period of time.
  As we have looked at this and we have talked about it, this is a bill 
today that comes to the floor with overwhelming support, not just on 
this floor, not just in the committee where it passed 32-0. It comes to 
this floor with an industry that many times couldn't even decide that 
they wanted to talk to each other about things in their industry, but 
who came together with overwhelming support and said this is where we 
need to be.
  I can remember when the chairman first laid out a vision that would 
deal with copyright. Most thought it was a dream that would never 
happen. In fact, some thought we would never even get text that people 
could agree on. They were wrong, because we did.
  I want to thank the leadership of Chairman Goodlatte and Ranking 
Member Nadler for their tireless commitment to getting something done 
on copyright, which ultimately got us here. I thank their staffs: Joe 
Keeley, Lisette Morton, and Jason Everett.
  Also in this, Mr. Speaker, there is someone whom I also want to thank 
who, not only in this bill but in many others, epitomizes to me what is 
good about this institution. The Music Modernization Act has put my 
friend Hakeem Jeffries and I in, again, a leading role and is living 
proof that a rural Member from northeast Georgia and a Democrat from 
Brooklyn can find common ground. With Hakeem and I, we know that we can 
come together with good product when we have the right intentions in 
mind.
  Senators Hatch and Alexander have been champions in the Senate, where 
they have introduced companion legislation. Congressmen Issa, Rooney, 
and Crowley have all been key players, and many from different States 
have all taken part in this. As I have said earlier, they come from 
many places: David Israelite with NMPA; Bart Herbison from Nashville 
Songwriters Association International; Dina LaPolt, Michelle Lewis, and 
Kay Hanley from SONA; Beth Mathews from ASCAP; Mike O'Neill from BMI; 
Chris Harrison from Digital Media; Michael Beckerman from Internet 
Association; Mitch Glazier from Recording Industry Association of 
America; Todd Dupler and Darryl Friedman from Recording Academy; and 
others, such as Rick Carnes, Mike Huppe, Curtis LeGeyt, and many 
others; also my friends, one sitting behind me, Marsha Blackburn as 
well, who has been at the forefront of this.
  Mr. Speaker, before I finish up in just a little bit, I do need to 
thank two more, and that is my staff, who have lived with me, who have 
worked with me for a long time: Brendan Belair, my chief of staff, who 
has kept us on target; and Sally Rose Larson. You couldn't meet a 
better steel magnolia, who has shown herself to be such an invaluable 
asset during this process.
  Mr. Speaker, I want to end not with the bill. We will talk about it. 
But what brought me to this point and what brought me to this area and 
why this is so important today as we move forward for generations of 
others: I want to take you back in time almost 40-plus years to a state 
trooper's kid in north Georgia whose friends were books, whose friends 
were music, a radio, and songs that came true. It was in there that 
those songs that would come out, the music and lyrics, would take me to 
places far away from northeast Georgia and let me travel the world long 
before I could even drive a car.
  When we talk about copyright and we talk about the creator's spirit, 
it is about the creator's spirit, what comes out of their heart, that 
comes out of their mind, that comes through their hands and out of 
their mouths and into the lives that touch everyone of whom we become a 
part.
  This is about something bigger than ourselves. And my friend Hakeem 
and all the rest who have worked on this show that this place, when put 
properly forward, can touch the very soul of America. We have new ways 
of hearing that music nowadays, long past a radio. And the digital 
companies needed a place where they could give music to others, but 
songwriters needed to be fairly compensated.
  When I think of my friends who write music--Hakeem, we have talked to 
so many--it is about hopes, it is about dreams, it is about everything 
in this place. Any one of us in here would think of a song that could 
make us think of the first time we fell in love, the first time we had 
our heart broken, the first time we laid someone to rest, the first 
time we got that joyful noise of a new job or a new hope.
  Today, Mr. Speaker, we come carrying the dreams of those who have not 
even yet understood a song, of those who have not yet understood a 
melody. We carry those dreams into the future.
  And I want to thank everybody who has been a part of this, because 
today the song lives on, because it all begins with that emotion, with 
that heart, and with that melody.
  Mr. NADLER. Mr. Speaker, I yield 2 minutes to the gentleman from New 
York (Mr. Jeffries), the Democratic lead sponsor of the original Music 
Modernization Act.
  Mr. JEFFRIES. Mr. Speaker, I thank my good friend, the distinguished 
ranking member, for yielding, for his leadership, and, of course, to 
the chairman of the committee and to so many other Members: 
Representative Issa, Representative Rooney, and Representative Crowley 
and many, many others who have worked hard on this particular piece of 
legislation.
  Of course, above all else, I want to thank my good friend and 
colleague, Congressman Doug Collins, who has been a phenomenal leader 
in bringing stakeholders together from across the music ecosystem, 
bringing folks together from the digital industry, bringing the 
National Association of Broadcasters together to help us reach this 
moment where we have a consensus product that can ensure that the 
people of America and the Nation can continue to enjoy the music we 
have come to know and love.

  Article 1, section 8, clause 8 of the United States Constitution 
gives Congress the power to promote and create a robust intellectual 
property system in order to, in the words of the Founding Fathers, 
promote the progress of

[[Page H3538]]

science and useful arts. The Founding Fathers of this great Nation 
understood that we should incentivize creative brilliance and 
incentivize innovation and, in that context, that the creator should be 
able to benefit from the fruits of their labor and, in doing so, will 
continue to share their creative brilliance with the world.
  In the context of music, we know that the manner in which we have 
consumed music has changed over time: from vinyl to 8-track, from 8-
track to cassette, from cassette to CD, from CD to downloads, from 
downloading to streaming. The manner in which we consume music has 
changed, but the underlying brilliance and beauty and creativity of 
that music remains the same.
  Consistent with what the Founding Fathers have suggested, we need a 
modern-day music licensing system, and that is what the MMA will 
accomplish. I am thankful that it has brought together not just 
stakeholders and industry, but it has brought together a Jerry Nadler 
and a Chairman Goodlatte, a Darrell Issa and a Joe Crowley. It has 
brought together a conservative Republican from Georgia and a 
progressive Democrat from the people's republic of Brooklyn.
  Music is a unifying force. It has the power to bring us together. We 
should have the power to modernize our system on behalf of these 
brilliant creators.
  Mr. GOODLATTE. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman 
from Florida (Mr. Rutherford), a member of the Judiciary Committee.
  Mr. RUTHERFORD. Mr. Speaker, music has been an integral part of the 
fabric of our culture for hundreds of years because it can capture a 
moment in time and space like nothing else. You remember where you were 
the first time you heard that special song, and time after time, it 
takes you back to a moment and a place of significance in your life.
  For me, Mr. Speaker, one of the most meaningful songs in my life is 
``More Today Than Yesterday'' by The Spiral Starecase. It just so 
happens that that song signifies the bond between my wife, Pat, and I 
that we have shared now for over 45 years. And I can tell you, it is a 
priceless reminder of our lives and so many special moments together. 
And while we may not be able to put a price on a song's ability to 
transport us to a memory, we can all agree that the creators of the 
music we hold so dear should be fairly compensated for their craft.
  That is why I am so pleased to support the Music Modernization Act, 
which offers a long-overdue update to our copyright laws to account for 
the changing ways we consume music. Songwriters, musicians, producers, 
engineers, and artists should all have the opportunity to receive their 
fair due. And I thank Chairman Goodlatte, Ranking Member Nadler, and 
Representatives Collins and Jeffries for all their hard work to ensure 
that our copyright laws are all singing from the same sheet of music.
  Mr. NADLER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Florida (Mr. Deutch), one of the Democratic lead sponsors of this bill 
as well as of the Fair Play Fair Pay Act and the CLASSICS Act.
  Mr. DEUTCH. Mr. Speaker, I thank the ranking member and the chairman 
for their leadership. I thank Congressman Jeffries and Congressman 
Collins for helping to shepherd the bill to this point.
  It is a pleasure to vote on these much-needed consensus reforms. 
Consensus on copyright has been difficult. It has been difficult to 
forge between the various interests represented in the content and the 
tech communities but, fortunately, we now have consensus. Much of that 
has been borne out of true necessity, the technological demands of 
licensing tens of millions of songs and streaming services, and much of 
it has been borne out of basic fairness. Recording artists, 
songwriters, producers, and engineers deserve to be paid for their 
creativity and genius; and digital services deserve more certainty in 
their operations. The current system is broken.
  As someone who cares deeply about music and the incredible people who 
are a part of making it and who understands the importance of the 
intersection of technology and creative works that benefit all American 
music fans, I really feel privileged to be part of this process of 
modernizing our copyright laws. The Music Modernization Act does not 
include everything that I have supported to bring fairness and 21st-
century sophistication to the copyright laws, but it takes big steps 
forward toward those goals.
  I am hopeful that, with this bill, it will help to ensure that we all 
continue to benefit from the amazing artists of yesterday and today and 
the innovative technologies that bring them into our lives.
  Mr. Speaker, I urge my colleagues to support the Music Modernization 
Act.
  Mr. GOODLATTE. Mr. Speaker, at this time I yield 2\1/2\ minutes to 
the gentlewoman from Tennessee (Mrs. Blackburn), who is from music-
loving Tennessee and a great champion for the music industry and people 
who love music around our country.
  Mrs. BLACKBURN. Mr. Speaker, what an honor it is to stand here today 
and to celebrate the bipartisan work that has been done on this 
legislation and to bring it to this point.
  Indeed, this is something on which we can all agree: that the 
creative community, these wonderful creators, have that constitutional 
protection to what they create, the right to be compensated for their 
creation. And I am so appreciative that that has already been mentioned 
in this debate.
  Chairman Goodlatte said I come from music-loving Tennessee, and 
indeed I do. And we are so pleased that we are known as Music City and 
that, whether it is classical music or country or gospel, that you are 
going to hear music from every hill and every valley. And we treasure 
that creative community and protecting that product that they do 
create.
  Now, one of the things that has happened through time: With the 
change of delivery systems, it has become more difficult for these 
artists and these creators and the support network around them, the 
engineers, those who work on producing this product, to be 
appropriately compensated. This bill, as Doug Collins mentioned, has 
been in the works for years; and the CLASSICS Act, to take care of 
those who are now no longer able to tour and to make certain that they 
and their heirs are able to be compensated for that music that they 
have created.
  One thing to bear in mind: Songwriters and musicians are truly small-
business people. They work for themselves. Their stock and trade is 
their idea. And they have the right to commercialize that idea and to 
be compensated. The Music Modernization Act and the different bills 
that it brings together to update this system, to protect those 
copyrights, and to make certain that the creators are compensated, has 
been a collaborative effort.

                              {time}  1430

  Chairman Goodlatte and Congressman Collins have been to Nashville 
several times to meet with stakeholders and to hear their stories 
firsthand. We are grateful for that, we are grateful for the 
bipartisanship, and we are very grateful for the passage of this 
legislation.
  Mr. NADLER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Georgia (Mr. Johnson), the ranking member of the Committee on the 
Judiciary Subcommittee on Courts, Intellectual Property, and the 
Internet.
  Mr. JOHNSON of Georgia. Mr. Speaker, I rise in support of the Music 
Modernization Act, and I am also proud to be a cosponsor. This 
comprehensive music bill will help create an efficient and fair music 
licensing system.
  Currently, streaming services have to obtain licenses on a song-by-
song basis. The Music Modernization Act would reform section 115 of the 
Copyright Act by establishing a collective to offer blanket licenses to 
streaming services for mechanical rights.
  Under current law, only sound recordings made after 1972 receive 
payments from digital radio services under Federal law. This bill would 
benefit legacy artists and music creators who recorded music before 
1972 by establishing royalty payments whenever their music is played on 
digital radio.
  That is why this section of the bill is supported by Dionne Warwick, 
Duke Fakir of the Four Tops, Tina Turner, and the estates of Miles 
Davis and Otis Redding, among many others. The bill provides producers 
a right to collect

[[Page H3539]]

digital royalties and provides a process for studio professionals to 
receive royalties for their contributions to the creation of music. 
This bill would, for the first time, add producers and engineers who 
play an important role in the creation of sound recordings to the U.S. 
copyright law.
  Music organizations representing U.S. music publishers, record 
labels, songwriters, composers, artists, and performance rights 
organizations support this bill. The reforms made by this bill are 
critical because the royalty system has not kept pace with the digital 
age. These changes will benefit consumers, creators, and the entire 
music marketplace.
  I urge my colleagues to vote for this bill. I commend the efforts of 
Doug Collins, Hakeem Jeffries, and Chairman Goodlatte, as well as 
Ranking Member Nadler for shepherding this legislation to this point.
  Mr. GOODLATTE. Mr. Speaker, may I ask how much time I have left?
  The SPEAKER pro tempore. The gentleman from Virginia has 5\1/2\ 
minutes remaining. The gentleman from New York has 12 minutes 
remaining.
  Mr. GOODLATTE. Mr. Speaker, I reserve the balance of my time.
  Mr. NADLER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Rhode Island (Mr. Cicilline).
  Mr. CICILLINE. Mr. Speaker, I rise today in support of the Music 
Modernization Act. I am proud to be a cosponsor of this bill.
  I am proud to come from the great State of Rhode Island, the State 
that sent the great Senator Claiborne Pell to Washington. It was 
Senator Pell who authored the bill that established the National 
Endowment for the Arts and the National Endowment for the Humanities.
  Senator Pell knew that the greatness of our Nation is not only 
defined by the strength of our military or the value of our GDP, but by 
our ability to promote and protect our culture and history through the 
arts and humanities.
  In keeping with that tradition today, Congress moves to make sure 
that artists and their creations are protected under the Music 
Modernization Act. Music has always been a part of our culture and 
history. The power of music has brought people together in moments of 
celebration and soothed people in difficult times. Music transcends 
political, ethnic, and religious boundaries.
  The Music Modernization Act is the culmination of years of debate and 
negotiation with various stakeholders. We held dozens of hearings and 
heard from artists, producers, and industry experts to develop a 
solution that reflects the changing landscape of how people consume 
music and ensures creators are fairly compensated.
  From the start, we were committed to making sure this bill was 
bipartisan and a compromise that everyone could support. Within the 
music community, this legislation brought together an unprecedented 
coalition of music publishers, record labels, songwriters, composers, 
artists, and performance rights organizations.
  The result was a bill that is meant for the digital age and 
recognizes the contributions that many people are involved in during 
the creation of a song. For the first time, this bill will set up a 
collective that can give out blanket mechanical licenses to streaming 
services and ensure proper payments to songwriters and publishers.
  Importantly, this bill also ensures compensation for pre-1972 artists 
who have been left out of the Federal copyright system for far too 
long. It also provides a clearer process for engineers, mixers, and 
producers to collect royalties.
  It has been a privilege to be a part of this historic moment. I urge 
all of my colleagues to support the Music Modernization Act, and I want 
to thank Mr. Jeffries, Mr. Collins, Mr. Deutch, Chairman Goodlatte, and 
Ranking Member Nadler for their extraordinary leadership in 
accomplishing what is not only significant for our committee but 
significant for our ability to hear and appreciate and continue to 
nurture our souls with the beauty of music.
  Mr. GOODLATTE. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman 
from Tennessee (Mr. Roe), another Member from music-loving Tennessee 
and the chairman of the Veterans' Affairs Committee.
  Mr. ROE of Tennessee. Mr. Speaker, I rise today in support of H.R. 
5447, the Music Modernization Act, a bipartisan bill that will finally 
update our Nation's copyright laws and correct a terrible injustice 
that threatens the future of quality music.
  Music has changed, perhaps, more than any other industry over the 
past 50 years. When the Copyright Act of 1976 was signed into law, most 
people got their music on a vinyl record. I still like vinyl, I might 
add. Today, you can instantly stream music to your phone from any 
number of services at the touch of a button. That Copyright Act might 
have been what was needed at the time, but it never could have 
anticipated the radical shift in how music was consumed over the past, 
even in the last 10 years.

  For far too long, hardworking songwriters have been penalized under 
the old system and have been paid only pennies on the dollar for their 
creative works, even though their songs may have been streamed millions 
of times every second around the world.
  Garth Brooks' iconic song, ``The Dance,'' has been streamed tens of 
millions of times; and the songwriter, Tony Arata, who wrote that 
beautiful song, was paid a few hundred dollars. That is ridiculous, and 
it is wrong.
  Under the current system, the creative geniuses that write this music 
won't be able to make a living doing what they love doing, which is 
writing great songs. The Music Modernization Act seeks to fix this 
discrepancy and properly recognize the hard work these songwriters put 
into their craft before they simply stop writing music because they can 
no longer earn enough money to survive.
  As a musician myself, I understand what songwriters and performers go 
through when getting a song out for the world to hear, and it is time 
we recognize the contributions the songwriters make to the creative 
process. This bill was supported by the entire music industry: 
songwriters, record labels, music publishers, streaming services, just 
to name a few. It isn't often that we have a truly bipartisan and 
widely supported piece of legislation to consider, but with this bill, 
we have the opportunity and can change the lives of some of our 
Nation's most talented people for the better.
  I strongly support H.R. 5447 and encourage all of my colleagues to 
listen to their favorite song one more time before coming to the floor 
and think of the person who wrote it, think about what it means, then 
support this bill and truly make a difference in someone's life.
  Mr. NADLER. Mr. Speaker, I yield 2 minutes to the gentlewoman from 
Texas (Ms. Jackson Lee), a senior member of the Judiciary Committee.
  Ms. JACKSON LEE. Mr. Speaker, I thank the gentleman very much for 
yielding, and I make the very point that there are three Members on 
this floor today from the Judiciary Committee who have an enormous 
amount of seniority, who have seen the long journey that our talented 
genius-based musical icons in our Nation have traveled to come to this 
point, and so I say congratulations.
  In the markup, I indicated that there was a harmonious sound coming 
from the Judiciary Committee and that it was evident that we could work 
together in a bipartisan manner.
  I thank the chairman, Mr. Goodlatte, and the ranking member, Mr. 
Nadler, who have been intimately involved; and I am reminded of all of 
those who have come in and out of my office through the years as I 
served on the Courts, Intellectual Property, and the Internet Committee 
some years back and that they were still traveling even in this year, 
2018.
  So I applaud Mr. Collins and Mr. Jeffries for providing that musical 
tone. This is a very important bill. It is an important bill because it 
was an inconsistent patchwork that governed the industry that was in 
dire need of reframing, and the MMA 2018 addresses that patchwork. And 
specifically, under title II, it finally gives a just compensation to 
those artists who recorded works prior to 1972.
  First and foremost, the MMA is a proposition that is supported by 
both the majority of songwriters and publishers and the digital service 
providers.
  Secondly, it modernizes the process and brings music licensing into 
the 21st century--long overdue.

[[Page H3540]]

  Third, it puts unclaimed royalties in the hands of the content 
community, rather than sitting with digital services. It streamlines 
the streamline.
  Fourth, it finally creates a comprehensive database, and confidence 
grows in the market.
  And for all of those individuals who provided us the joy that was 
earlier mentioned, it creates a formalized body run by publishers that 
administer the law, the mechanical licensing and compositions streamed 
on services like Spotify and Apple Music, and others; it changes the 
procedure by which millions of songs are made available; and it funds 
the creation of a comprehensive database, but, more importantly, it 
helps those who prerecord it.
  My tribute to Aretha Franklin, Dionne Warwick, the late Jackie 
Wilson, Duke Fakir, The Shirelles, French Family in Houston, Bun B, 
Trae tha Truth, and the late Crickets, the Ebony singers in Houston, 
the Houston Grand Opera, Mrs. Barbara Tucker, End Jazz, Jason Moran, 
Kirk Whalum, Howard Harris, Imani children's band, Kashmere jazz band; 
and, of course, gospel, Kirk Clark, Kathy Taylor, Michael McCain, and 
Georgia Adams. Houston is a hub, Mr. Speaker, and we are celebrating 
because of this bill. I congratulate everyone.
  Mr. Speaker, I rise in support of the Music Modernization Act of 2018 
(MMA) of which I am an original cosponsor.
  This bill has arrived at its current state through the diligent work 
of various stakeholders involved, including the music industry, 
congressional staff, and Members of Congress.
  Hours of debate, negotiation, and deliberation have yielded a product 
of cooperation and compromise.
  I commend the industry and the parties involved in drafting this 
bipartisan solution--it is rare that this committee reaches such 
agreements when considering major legislation.
  Houston, being a music hub with its Grammy Award winning orchestra 
and Grammy nominated rappers including my dear friend Bun B from 
Underground Kingz, will certainly benefit from this legislation 
becoming law.
  The exemplary efforts exhibited by the music industry in this 
instance, with the goal of solving problems and addressing a wide 
variety of stakeholder concerns, are a model that this committee and 
this Congress should use as inspiration to best serve the American 
people.
  The need for this legislation is clear; much of the current licensing 
system was established in an analog era, with non-digital physical 
recordings done song-by-song, using compulsory licenses first 
established in 1909.
  In addition, artists who recorded works prior to 1972 do not receive 
any digital performance royalties under federal law, and current 
statute does not ensure that non-recording artists such as producers, 
sound engineers, and mixers receive revenue from webcasts of their 
work.
  The inconsistent patchwork that governs the industry is in dire need 
of reframing and the MMA 2018 addresses that patchwork and specifically 
under Title II, finally gives just compensation to those artists who 
recorded works prior to 1972.
  With the MMA, Congress is fulfilling its duty to provide order and 
guidance to the faulty program currently in place.
  The United States has the most innovative and influential music 
culture in the world, but its legal framework for music licensing dates 
back to the age of the Victrola.
  There is a widespread perception from across the industry that this 
complex framework is under strain and needs updating.
  The last general revision of the Copyright Act took place in 1976 
following a lengthy and comprehensive review process carried out by 
Congress, the Copyright Office, and interested parties.
  Congress significantly amended the Act in 1995, with the Digital 
Performance Right in Sound Recordings Act (``DPRSRA''), and 1998, with 
the Digital Millennium Copyright Act (``DMCA''), to address emerging 
issues of the digital age.
  While the current Copyright Act reflects many sound and enduring 
principles, and has enabled the internet to flourish, it could not have 
foreseen all of today's technologies and the myriad ways consumers and 
others engage with music in the digital environment.
  First and foremost, the MMA is a proposition that is supported by 
both a majority of songwriters and publishers and the (Digital Service 
Providers)--two groups who rarely agree.
  Secondly, it ``modernizes'' the process and brings music licensing 
into the 21st century.
  Instead of bulk Notices of Intention--the environmentally unfriendly 
process of sending actual physical letters of intent to each publisher 
for each share of each song--the licensing will be done electronically.
  Third, it puts unclaimed royalties in the hands of the content 
community, rather than sitting with the Digital Service Providers.
  Fourth, it finally creates a comprehensive database.
   While various companies and services have a version of a database, 
U.S. publishers have not agreed on one that is both comprehensive and 
accurate.
  As part of the MMA, the digital service providers will pay for the 
creation and maintenance of a database that will finally put all 
mechanical licensing information in one place that is accessible to 
all.
  Finally, it provides streaming services with confidence that, if they 
follow the process, they can accurately and comprehensively license all 
the musical works on their service without fear of billion dollar 
lawsuits against them.
  And confidence grows markets and boosts economy.
  A number of interested music industry groups have come together to 
create a consensus bill that makes several major changes including: 
Title I--Music Modernization Act.
  The Music Modernization act creates a formalized body, run by 
publishers, that administers the ``mechanical licensing'' of 
compositions streamed on services like Spotify and Apple Music (these 
companies are referred as Digital Service Providers or DSPs).
  The bill reflects how modern digital music services operate by 
creating a blanket licensing system to quickly license and pay for 
musical work copyrights.
  It changes the procedure by which millions of songs are made 
available for streaming on these services and limits the liability a 
service can incur if it adheres to the new process.
  Discusses music litigation that generates legal settlements in favor 
of simply ensuring that artists and copyright owners are paid in the 
first place without such litigation.
  The MMA funds the creation of a comprehensive database with buy in 
from all the major publishers and digital service providers.
  Ends the flawed U.S. Copyright Office bulk notice of intent system 
that allows royalties to go unpaid.
  The bill also creates a new evidentiary standard by which the 
performance rights organizations American Society of Composers, 
Authors, and Publishers (ASCAP) and Broadcast Music Incorporated (BMI) 
can argue better rates for the performance of musical works on DSPs.
  It implements uniform rate setting standards to be used by the 
Copyright Royalty Board for all music services.
  The bill shifts the costs of the new licensing collective created by 
the bill to those who benefit from the collective--the licensees.
  The MMA updates how certain rate court cases are assigned in the 
Southern District of New York.
  Title II--Compensating Legacy Artists for their Songs, Service, and 
Important Contributions to Society (CLASSICS) Act provides a public 
performance right for pre-1972 recordings.
  Title III--The Allocation for Music Producers (AMP) Act ensures that 
record producers, sound engineers, and other creative professionals 
receive compensation for their work
  I urge my colleagues to join me in support of the MMA.
  Mr. GOODLATTE. Mr. Speaker, I reserve the balance of my time.
  Mr. NADLER. Mr. Speaker, I yield 2 minutes to the gentlewoman from 
California (Ms. Bass).
  Ms. BASS. Mr. Speaker, I rise today in support of the Music 
Modernization Act. I also come from one of those districts that is a 
hub.
  After meeting with songwriters and producers in my district and 
listening to their testimony before the House Judiciary Committee, it 
is clear we risk losing the next generation of songwriters if we do not 
address the rate standards for digital streaming.
  Recently, I met with world-renown songwriter, Paul Williams, and I 
have had open discussions with hundreds of songwriters from around the 
country. Songwriters from my district have voiced that it is nearly 
impossible to earn a fair income via digital streaming. They are 
usually not the famous performers and cannot go on tour to earn a 
living.
  Over 50 percent of their income is derived from licensing performance 
rights to their music. One of my constituents, Michelle Lewis, shared 
that she made just $3.78 for 1.3 million streams of her work on one 
streaming service. As the Grammy Award winning artist and songwriter 
Ne-Yo stated: ``Even if you write a hit song that's streamed millions 
of times, you're still not going to earn enough to pay the rent from 
streaming. And that's where the entire industry is moving,'' which

[[Page H3541]]

is why I support the Songwriters Equity Act, AMP, the CLASSICS Act, and 
MMA.
  MMA also closes a loophole, which has negatively impacted early music 
icons of Motown, jazz, blues, and rock and roll. According to Grammy 
Award winning artist Dionne Warwick: ``How could it be that 1979's 
`I'll Never Love This Way Again' receive compensation, but 1969's `I'll 
Never Fall in Love Again' . . . does not?''
  Recently, legacy songwriter and performer Darlene Love visited my 
office to express her support for closing the legacy loophole. Born in 
Los Angeles, she was inducted into the Rock and Roll Hall of Fame in 
2011. She sang backup for Elvis, Aretha Franklin, and Frank Sinatra. 
After decades of listening to her hard work being streamed without 
being compensated, with the passage of MMA, she and other songwriters 
will finally have access to the fair compensation they deserve.
  If we are serious about supporting a next generation of songwriters, 
then we must continue to address antiquated, though well-intentioned, 
laws.
  Mr. GOODLATTE. Mr. Speaker, I yield 2 minutes to the gentleman from 
Ohio (Mr. Chabot), a member of the Judiciary Committee and chairman of 
the Small Business Committee.
  Mr. CHABOT. Mr. Speaker, I rise today to express my continued support 
for this legislation. A lot of hard work has gone into this legislation 
over the years, and the result is an unprecedented level of consensus 
from a broad coalition of stakeholders in the music industry who don't 
always agree.

                              {time}  1445

  This legislation, I think, will prove to be a great benefit to music 
consumers, creators, and producers alike.
  The way we listen to and experience music is much different today 
than it was when the Copyright Act was enacted back in 1976. As a 
result, our copyright laws have become outdated and are, in many ways, 
insufficient for the music industry in the 21st century. This 
legislation provides much-needed updates to bring music licensing into 
the digital age, particularly improving market efficiencies and 
transparency to reflect the modern music marketplace.
  So again, I thank the chairman, ranking member, and various sponsors 
of the underlying pieces of legislation included in this bill.
  Mr. Speaker, I urge my colleagues to support this bill.
  Mr. NADLER. Mr. Speaker, I yield 1 minute to the gentleman from 
California (Mr. Ted Lieu).
  Mr. TED LIEU of California. Mr. Speaker, as has been said, music is 
the lifeblood of culture that can transform world views, transport 
listeners, and inspire social movements.
  Ensuring that the law keeps up with music and its changing forms is 
crucial. With the support of music publishers, artists, songwriters, 
streaming services, and other stakeholders, the Music Modernization Act 
will propel the music industry into the 21st century and beyond. I am 
proud to be an original cosponsor of the act.
  I want to thank Chairman Goodlatte, Ranking Member Nadler, as well as 
Representatives Collins, Jeffries, and others for their hard work on 
this bill.
  As the Representative for California's 33rd Congressional District, 
these issues hit close to home. My district sits at the heart of 
California's music industry. It is home to thousands of brilliant 
songwriters, publishers, engineers, record producers, recording 
artists, and musicians.
  I am proud to have worked with such a unique and engaged community. 
They make up different threads of the industry's fabric, but share a 
common goal of developing solutions to some of the most complex and 
longstanding copyright issues facing our country. Today, we honor that 
legacy by moving Federal music copyright forward.
  Mr. Speaker, I urge my colleagues to support this bill.
  Mr. GOODLATTE. Mr. Speaker, I reserve the balance of my time.
  Mr. NADLER. Mr. Speaker, how much time do I have remaining, please?
  The SPEAKER pro tempore. The gentleman from New York has 5 minutes 
remaining. The gentleman from Virginia has 2 minutes remaining.
  Mr. NADLER. Mr. Speaker, I yield 1 minute to the gentlewoman from 
California (Ms. Judy Chu).
  Ms. JUDY CHU of California. Mr. Speaker, I rise in strong support of 
the Music Modernization Act. As co-chair of the Congressional Creative 
Rights Caucus, I am proud to stand with my colleagues to support this 
consensus bill that aims to modernize our copyright law.
  Music is at the heart of how we experience life. We count on the 
right song to help us express a moment better than we could ourselves.
  For music creators, their works help them support their families, 
keep a roof over their head, and food on the table. But, for far too 
long, I have heard from songwriters whose compensation was less than 
pennies in digital play for number one hits, and I have heard from 
music legends who are touring well into their seventies because their 
works created before 1972 are not eligible for royalties on digital 
broadcasts.
  This bill will help bring our copyright law into the digital era and 
address the gaps that prevent creators from receiving fair compensation 
for their work. Mr. Speaker, I urge my colleagues to vote for this 
bill. The lives of our most treasured creators depend on it.
  Mr. GOODLATTE. Mr. Speaker, I continue to reserve the balance of my 
time.
  Mr. NADLER. Mr. Speaker, I yield 2 minutes to the gentleman from New 
York (Mr. Crowley), the distinguished Democratic Caucus chair and the 
lead sponsor of the AMP Act, which is included in this package.
  Mr. CROWLEY. Mr. Speaker, I thank my friend and colleague from New 
York (Mr. Nadler) for yielding.
  Mr. Speaker, I thank Chairman Goodlatte, Ranking Member Nadler, 
Congressman Doug Collins, Congressman Hakeem Jeffries, and all of my 
friends on the Judiciary Committee for working in such a bipartisan 
fashion to get this important bill to the floor.
  We all remember the iconic tune from the 1970s, ``I Write the 
Songs.'' First performed by Captain and Tennille and made popular by 
David Cassidy and, of course, Barry Manilow, the song encapsulates the 
universality of music.
  While we rightly celebrate the artists and singers behind these hits 
and these great songs, there often are a number of individuals who work 
just as hard to make that song a hit. Because to make a great song, you 
need not just the writers and the singers, but also engineers, 
technicians, and producers, people like my friend Mike Clink, as well 
as Darrell Brown. They may not be as famous as Guns N' Roses or LeAnn 
Rimes, the folks they helped produce, but they are equally important 
when it comes to the process of making that music. But they are not 
often given the credit or compensation they so rightly deserve.
  With this bill, that will finally change. We are making important 
updates to music copyright law to make sure that everyone with a role 
in making hits that get stuck in our heads gets paid for their fair 
share.
  I am especially glad that my bill, the Allocation for Music 
Producers, or AMP Act, is included in this package. I thank my 
colleague across the aisle, Tom Rooney, for working with me to help the 
many people who work so hard to make perfect the iconic recordings we 
hear every day.
  This bill will, for the first time, make mention of engineers and 
producers in copyright law and provide a system for them to be directly 
paid for the hard work that they do.

  As a musician and songwriter myself, I am so glad to see bipartisan 
agreement around these important issues. I am proud to see all of the 
various folks in the recording industry coalesce around these critical 
fixes, and I am proud to vote today in support of fair compensation for 
creators in the music industry.
  Mr. GOODLATTE. Mr. Speaker, I continue to reserve the balance of my 
time.
  Mr. NADLER. Mr. Speaker, I yield 1 minute to the gentleman from 
Tennessee (Mr. Cohen).
  Mr. COHEN. Mr. Speaker, I thank Mr. Nadler for yielding. I appreciate 
the work of Mr. Goodlatte and the other sponsors, Mr. Nadler and 
everybody else.
  This was really an issue where we showed that Congress can be 
productive, can get something done, working

[[Page H3542]]

with all of the different groups and bringing them together. It is a 
successful effort.
  Music is very important to my hometown of Memphis, which, of course, 
is the hometown of Elvis Presley, where Sam Phillips put Elvis in the 
studio at Sun Records and produced the rock and roll that Chuck Berry 
and Little Richard had been playing but had not really reached a lot of 
people's ears. It did, and it set the world on fire. It brought a 
change in music and an appreciation for it.
  In Memphis, we have had Isaac Hayes, who did so much; Sam and Dave; 
David Porter; and many, many Memphians who participated.
  But I have personal friends in Warren Zevon, Jackson Browne, and J.D. 
Souther, who were great songwriters and performers and have not 
received, necessarily, their financial due as they should, and 
fairness, and this will get them done.
  As Mr. Crowley mentioned, it will get engineers and producers payment 
for their work to help create these musical creations that people love.
  Mr. Speaker, I thank all of the sponsors and appreciate the fact that 
I was able to participate and support it and be a cosponsor.
  Mr. GOODLATTE. Mr. Speaker, I continue to reserve the balance of my 
time.
  Mr. NADLER. Mr. Speaker, I yield 1 minute to the gentleman from Texas 
(Mr. Doggett).
  Mr. DOGGETT. Mr. Speaker, my hometown of Austin, Texas, is modestly 
known as the ``Live Music Capital of the World.'' The title is well 
justified, from the South by Southwest music festival in the spring, to 
Austin City Limits on a couple of weekends in October. It is a 
wonderful place for live music.
  It is the musicians and those who support them in technical ways--
weekday, weekend, and in between--that make this industry so vital and 
who contribute so much to our local economy.
  This piece of legislation is a step in the right direction. There is 
much more that needs to be done to ensure that our musicians and all 
who are involved in the creative economy get their fair compensation.
  I am pleased this step is taken because these are really not only 
talented and creative people, but small-business people, and they 
deserve to have the property that they generate--their talent, their 
music, that adds so much joy to our lives--fairly compensated. This is 
a good step forward, and I certainly support the legislation.
  Mr. NADLER. Mr. Speaker, I yield back the balance of my time.
  Mr. GOODLATTE. Mr. Speaker, may I inquire how much time is remaining.
  The SPEAKER pro tempore (Mr. Lamborn). The gentleman from Virginia 
has 2 minutes remaining.
  Mr. GOODLATTE. Mr. Speaker, I yield myself the balance of my time to 
close.
  Mr. Speaker, this is landmark legislation that has been decades in 
coming. We have not had a significant review of our music licensing and 
copyright laws in many, many, many years.
  There are many people to be thanked, including the staff of the 
Judiciary Committee on both sides of the aisle. I particularly want to 
recognize Joe Keeley, who is the chief counsel of the Courts, 
Intellectual Property, and the Internet Subcommittee.
  I also want to thank the leadership of the committee who have worked 
for many, many years on intellectual property issues: Shelley Husband, 
the chief of staff and general counsel; and Branden Ritchie, the chief 
counsel of the committee.
  Time doesn't allow me to recognize everyone, but I especially want to 
recognize the Courts, Intellectual Property, and the Internet 
Subcommittee vice chairman, Doug Collins. He and his staff have put 
literally hundreds and hundreds of hours into aspects of this 
legislation, and I want to personally thank him for that work as well.
  This legislation has very strong, bipartisan support. It is supported 
by groups that look at intellectual property issues across the 
ideological spectrum, and it is nearly universally supported by the 
music industry, the technology companies, and others that provide the 
platforms on which that music is performed.
  It is going to more fairly treat so many sectors of the music 
industry that it would be a shame not to see this legislation pass the 
House with a very strong, bipartisan vote, go to the Senate, pass 
there, and then on to the President's desk, where I have every 
confidence it will be signed into law.
  During the course of many years of review of our copyright laws, we 
learned that our music licensing laws were no longer working as 
intended for songwriters, artists, and creators, people behind the 
scenes for the companies that deliver the music in innovative ways to 
our consumers.
  The Music Modernization Act, a product of the Judiciary Committee's 
comprehensive copyright review, is a bipartisan bill. I urge my 
colleagues to join together and pass it and send it to the Senate.
  Mr. Speaker, I yield back the balance of my time.
  Mrs. TORRES. Mr. Speaker, I rise in support of H.R. 5447, The Music 
Modernization Act. Mr. Speaker, there is broad, bipartisan agreement 
that current music licensing laws no longer meet the needs of creators 
and music providers in the digital age. Southern California has 
established itself as a leader in the entertainment industry, and 
supporting our artists and music industry is a job creator for my 
constituents.
  This bill would address the inefficiencies in the music industry's 
licensing system by establishing uniformity in the licensing process. 
Licenses will now be managed by one entity which in turn would be paid 
for by the licensees. In addition to an increase in efficiency, the 
Music Modernization Act would foster a more transparent relationship 
between creators and music platforms. Information regarding music owed 
royalties would be easily accessible through the database created by 
the Music Modernization Act. This transparency will surely improve the 
working relationship between creators and music platforms and aid the 
music industry's innovation process.
  Most importantly, this bill would establish a uniformed rate that 
would allow song writers and artists to receive fair market pay for 
their ideas and creations.
  As a society, we value the work and products of artists, creators, 
and the music industry. For years now, creators, and music providers 
have spoken out about the outdated music licensing process and the 
issues they repeatedly face because of its flawed system. It is only 
fair that we address these inefficiencies and bring the music 
industries' processes in accordance with the digital age.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Virginia (Mr. Goodlatte) that the House suspend the 
rules and pass the bill, H.R. 5447, as amended.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds 
being in the affirmative, the ayes have it.
  Mr. GOODLATTE. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further 
proceedings on this motion will be postponed.

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