,i  #aacth ,,congress  #ast ,session    
,h4 ,r4 #cbai  ,,in ,,the ,,house ,,of  
,,representatives  ,september #cj1      
#bjac,mr4 ,watt introduced the following
 bill2 which was referred to the        
,committee on the ,judiciary  ,a ,,bill 
,to amend title #ag1 ,united ,states    
,code1 to provide copyright owners in   
sound recordings with the exclusive     
right to negotiate in the marketplace   
the performance of their works to the   
public by means of an audio             
transmission1 and for other purposes4   
#a4 ,short title ,this ,act may be cited
 as the ,free ,market ,royalty ,act4    
#b4 ,broadcast performance right in     
sound recordings ,section #ajf7f7 of    
title #ag1 ,united ,states ,code1 is    
amended by striking a digital audio and 
inserting an audio4  #c4 ,free market   
for licensing of public performances    
,section #aad of title #ag1 ,united     
,states ,code1 is amended as follows3   
7#a7 ,subsection 7d7 is amended-- 7,a7  
in paragraph 7#a7-- 7i7 in the matter   

preceding subparagraph 7,a71 by striking
 a digital audio and inserting an audio2
  7ii7 by striking subparagraph 7,a72   
and  7iii7 by redesignating             
subparagraphs 7,b7 and 7,c7 as          
subparagraphs 7,a7 and 7,b71            
respectively2  7,b7 by striking         
paragraph 7#b72  7,c7 in paragraph      
7#c7-- 7i7 in subparagraphs 7,a7 and    
7,b77i71 by striking of digital audio   
and inserting of an audio2 and  7ii7 in 
subparagraph 7,d71 by striking a digital
 audio and inserting an audio2  7,d7 in 
paragraph 7#d71 in subparagraphs 7,a7   
and 7,b77i71 by striking a digital audio
 and inserting an audio2 and  7,e7 by   
redesignating paragraphs 7#c7 and 7#d7  
as paragraphs 7#b7 and 7#c71            
respectively4  7#b7 ,section #aad of    
title #ag1 ,united ,states ,code1 is    
amended by striking subsections 7e71    
7f71 and 7g71 and inserting the         
following3  7e7 ,efficiency of licensing
  7#a7 ,collective negotiation for      
noninteractive services ,pursuant to    

section #ajf7f71 and notwithstanding any
 other provision of law1 any            
noninteractive services performing sound
 recordings publicly by means of an     
audio transmission may collectively     
negotiate and agree to royalty rates and
 license terms and conditions for the   
performance of such sound recordings4   
7#b7 ,one-stop licensing for            
noninteractive services  7,a7           
,negotiation of licenses by common agent
 ,pursuant to section #ajf7f71 and      
notwithstanding any other provision of  
law1 for licenses for noninteractive    
audio transmissions1 ,sound,exchange1   
,inc41 or any successor entity is       
designated as the sole common agent to  
negotiate1 agree to1 pay1 and receive   
payments under this section4 ,if a      
license for noninteractive audio        
transmissions is agreed to by such      
common agent1 copyright owners of sound 
recordings may subsequently negotiate   
and agree to royalty rates and license  
terms and conditions with any           

noninteractive services performing sound
 recordings publicly by means of an     
audio transmission for the performance  
of such sound recordings4  7,b7 ,direct 
payment and equal compensation ,the     
common agent under subparagraph 7,a7    
shall make distributions directly to the
 following recipients from payments     
collected under this section as follows3
 7i7 #ej percent shall be paid to the   
copyright owner4  7ii7 #de percent shall
 be paid to featured recording artists4 
7iii7 #e percent shall be paid to       
nonfeatured musicians and vocalists     
7through the ,american ,federation of   
,musicians and ,screen ,actors          
,guild-,american ,federation of         
,television and ,radio ,artists         
,intellectual ,property ,rights         
,distribution ,fund1 or their           
successors74  7f7 ,payments from        
individual licenses for noninteractive  
audio transmissions ,in the case of a   
license granted by the copyright owner  
of a sound recording to a noninteractive

 service performing sound recordings    
publicly by means of an audio           
transmission1 such service shall pay to 
the common agent described in subsection
 7e7 receipts from the licensing of such
 transmissions in an amount equal to #ej
 percent of the total royalties and     
other compensation that the service is  
required to pay for such transmissions  
under the applicable license agreement4 
,such common agent shall distribute such
 payments in proportion to the          
distributions provided in clauses 7ii7  
and 7iii7 of subsection 7e77#b77;,b71   
and such payments shall be the sole     
payments to which featured and          
nonfeatured artists are entitled by     
reason of such transmissions under the  
license with that service4  7g7         
,backstop for public and noncommercial  
stations  7#a7 ,establishment of rates  
and terms ,if royalty rates and license 
terms and conditions for the audio      
transmission or retransmission of a     
nonsubscription broadcast consisting    

solely of noncommercial educational and 
cultural radio programs are not         
negotiated and agreed upon collectively 
under subsection 7e7 between the common 
agent and a noncommercial educational   
broadcast station funded on or after    
,january #a1 #aiie1 under section       
#cif7k7 of the ,communications ,act of  
#aicd 7#dg ,u4,s4,c4 #cif7k771 a        
proceeding under chapter #h of this     
title shall determine the rates and     
terms for such transmissions and        
retransmissions4 ,the ,copyright        
,royalty ,judges shall establish such   
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  
seller4 ,in determining such rates and  
terms1 the ,copyright ,royalty ,judges  
shall base their decision on economic1  
competitive1 and programming information
 presented by the parties4  7#b7        
,payment of royalties ,all royalty      
payments under this subsection for      

over-the-air nonsubscription broadcast  
transmissions required to be paid by    
public broadcasting entities that are   
eligible to receive funding on the basis
 of the formula set forth in section    
#cif7k77#f77;,b7 of the ,communications 
,act of #aicd 7#dg ,u4,s4,c4            
#cif7k77#f77;,b77 or that are authorized
 to transmit over-the-air               
nonsubscription broadcast performances  
of nondramatic musical works pursuant to
 arrangements negotiated or otherwise   
made by the ,corporation for ,public    
,broadcasting under section #aah1 shall 
first be made using funds made available
 pursuant to section                    
#cif7k77#c77;,a77,i77,,ii7 of the       
,communications ,act of #aicd4  4  7#c7 
,subsection 7h77#a7 is amended by       
striking a digital audio and inserting  
an audio4  7#d7 ,subsection 7j7 is      
amended-- 7,a7 in paragraph 7#a71 by    
striking digital audio and inserting    
audio2  7,b7 by striking paragraphs     
7#b71 7#d71 7#e71 7#f71 7#h71 7#aj71 and

 7#aa72  7,c7 by inserting after        
paragraph 7#a7 the following3  7#b7 ,an 
audio transmission is a transmission    
that embodies the transmission of a     
sound recording1 and does not include   
the transmission of any audiovisual     
work4  2  7,d7 by redesignating         
paragraph 7#g7 as paragraph 7#d72  7,e7 
by inserting after paragraph 7#d71 as   
redesignated1 the following3  7#e7 ,a   
noninteractive service is a service that
 would have been eligible for statutory 
licensing under subsection 7d77#b7 of   
this section1 as such subsection was in 
effect on ,september #a1 #bjac  2 and   
7,f7 by redesignating paragraphs 7#i71  
7#ab71 7#ac71 7#ad71 and 7#ae7 as       
paragraphs 7#f71 7#g71 7#h71 7#i71 and  
7#aj7 respectively4  #d4 ,ephemeral     
recordings ,section #aab of title #ag1  
,united ,states ,code1 is amended-- 7#a7
 in subsection 7a77#a71 by striking     
including a statutory license under     
section #aad7;f7 and inserting including
 a license to perform a sound recording 

under section #aad2 and  7#b7 by        
striking subsection 7e7 and inserting   
the following3  7e7 ,efficiency of      
licensing ,the provisions of subsections
 7e77#a71 7e77#b77;,a71 and 7g7 of      
section #aad shall apply to licensing of
 the right to reproduce phonorecords of 
a sound recording under section         
#ajf7a7-- 7#a7 for use solely to make   
noninteractive audio transmissions      
licensable under such subsections of    
section #aad1 or  7#b7 for use solely   
under the limitation on exclusive rights
 specified by section                   
#aad7;d77#a77;,b77iv71  under           
circumstances in which such             
reproductions would have been eligible  
for statutory licensing under this      
subsection1 as this subsection was in   
effect on ,september #a1 #bjac4  4  #e4 
,chapter #h proceedings of ,copyright   
,royalty ,judges2 technical amendments  
7a7 ,functions ,section #hja7;b7 of     
title #ag1 ,united ,states ,code1 is    
amended-- 7#a7 in paragraph 7#a7-- 7,a7 

by striking #aab7;e71 #aad12 and  7,b7  
by striking sections #aad7;f77#a77;,b71 
#aae1 and inserting sections #aae2  7#b7
 in paragraph 7#c77;,c71 by striking    
#hjd7;b77#h7 and inserting #hjd7;b77#g72
  7#c7 in paragraph 7#g77;,b71 by       
striking #aab7;e77#e71 #aad7;f77#c712   
7#d7 by redesignating paragraph 7#h7 as 
paragraph 7#i72 and  7#e7 by inserting  
after paragraph 7#g7 the following3     
7#h7 ,to determine the rates and terms  
for transmissions under section #aad7;g7
 and reproductions under section        
#aab7;e74  4  7b7 ,proceedings ,section 
#hjc of title #ag1 ,united ,states      
,code1 is amended-- 7#a7 in subsection  
7b77#a77;,a77i7-- 7,a7 by striking      
subclauses 7,,ii7 and 7,,iii72  7,b7 in 
subclause 7,,iv71 by striking           
#hjd7;b77#h7 and inserting #hjd7;b77#g72
 and  7,c7 by redesignating subclauses  
7,,iv7 and 7,v7 as subclauses 7,,ii7 and
 7,,iii71 respectively2 and  7#b7 in    
subsection 7c77#b77;,e77i71 by striking 
on a specified date1 then-- and all that

 follows through as of the date of that 
determination4 and inserting on a       
specified date1 then the initial        
determination of the ,copyright ,royalty
 ,judges that is the subject of the     
rehearing motion shall be effective as  
of the day following the date on which  
the rates and terms that were previously
 in effect expire44  7c7 ,judicial      
review ,section #hjc7;d77#b77;,c77ii7 of
 title #ag1 ,united ,states ,code1 is   
amended by striking by the ,copyright   
,royalty ,judges and inserting under    
section #aad7;e77#b7 or #aab7;e71 or1 in
 any other case1 by the ,copyright      
,royalty ,judges14  7d7 ,institution of 
proceedings ,section #hjd of title #ag1 
,united ,states ,code1 is amended-- 7#a7
 in subsection 7a7-- 7,a7 in the first  
sentence1 by striking #aab1 #aad12 and  
7,b7 by striking the last sentence2 and 
7#b7 in subsection 7b7-- 7,a7 by        
striking paragraph 7#b72  7,b7 by       
striking paragraph 7#c7 and inserting   
the following3  7#b7 ,certain sections  

#aad and #aab proceedings ,proceedings  
under this chapter to determine terms   
and rates of royalty payments under     
section #aad7;g7 or #aab7;e7 may be     
commenced only pursuant to petitions    
filed after the end of the #f-month     
period beginning on the effective date  
of the ,free ,market ,royalty ,act4     
,thereafter1 proceedings described in   
the preceding sentence may be commenced 
only pursuant to a petition filed at any
 time within #a year after negotiated   
licenses authorized by section #aad or  
#aab7;e7 7as the case may be7 expire and
 are not replaced by subsequent         
agreements4 ,for purposes of proceedings
 to determine terms and rates under this
 paragraph1 the ,copyright ,royalty     
,judges shall make a determination as to
 whether the petitioner has a           
significant interest in the terms and   
rates in which a determination by the   
,judges is requested4 ,if the ,copyright
 ,royalty ,judges determine that the    
petitioner has such a significant       

interest1 the ,copyright ,royalty       
,judges shall cause notice of this      
determination1 with the reasons for such
 determination1 to be published in the  
,federal ,register1 together with the   
notice of commencement of proceedings   
under this chapter4  2 and  7,c7 by     
redesignating paragraphs 7#d7 through   
7#h7 as paragraphs 7#c7 through 7#g71   
respectively4  7e7 ,technical amendments
 ,section #aad of title #ag1 ,united    
,states ,code1 is amended as follows3   
7#a7 ,subsection 7a7 is amended by      
striking clauses and inserting          
paragraphs4  7#b7 ,subsection 7b7 is    
amended-- 7,a7 by striking clause each  
place it appears and inserting          
paragraph2  7,b7 by striking clauses    
each place it appears and inserting     
paragraphs2 and  7,c7 by striking       
section #cig of title #dg and inserting 
section #cig of the ,communications ,act
 of #aicd 7#dg ,u4,s4,c4 #cig74  #f4    
,study by ,copyright ,office ,the       
,register of ,copyrights shall-- 7#a7   

conduct a study on the protection of    
making available to the public          
copyrighted works under paragraph 7#c7  
of section #ajf of title #ag1 ,united   
,states ,code1 and communicating to the 
public copyrighted works under paragraph
 7#d7 of such section1 and recommend any
 amendments to such paragraphs necessary
 to so protect the rights of making     
available to the public copyrighted     
works and communicating to the public   
copyrighted works2 and  7#b7 not later  
than #i months after the date of the    
enactment of this ,act1 submit to the   
,committees on the ,judiciary of the    
,house of ,representatives and the      
,senate a report on the results of the  
studies conducted under paragraph 7#a71 
including any recommendations under such
 paragraph4  #g4 ,effective date  7a7   
,phase-,out of statutory licenses ,the  
amendments made by sections #b1 #c1 #d1 
and #e-- 7#a7 shall take effect upon the
 expiration of the #a-year period       
beginning on the date of the enactment  

of this ,act2 and  7#b7 shall apply with
 respect to audio transmissions of sound
 recordings that are made on or after   
the effective date under paragraph 7#a74
  7b7 ,other provisions ,sections #a and
 #f shall take effect on the date of the
 enactment of this ,act4