Title: Collective administration of online rights in musical works: analysing the economic efficiency of the Directive 2014/26/EU

Authors: Ana María Peréz Gómez; Maria Alejandra Echavarría Arcila

Addresses: Intellectual Property Department, Universidad Externado de Colombia, Calle 12 # 1-17 Este, Bogotá, Colombia ' Intellectual Property Center, Universidad Pontificia Bolivariana, Circular 1 70-01, Medellín, Colombia

Abstract: Due to technological development, the distribution and exploitation of cultural content has transcended national borders and demands an administration of copyright and related rights on a multi-territorial basis. Considering their natural monopoly, the collective management organisations (hereafter 'CMOs') are an economically efficient option to grant cross-border and cross-repertory licenses for the online digital market, not only because of the diminution of the transaction costs, but also for the transfer of risk. Nevertheless, the information asymmetries between market actors implied by such administration lead to the need of granting transparency in their relationships, to prevent the problem of moral hazard. To that effect, the Directive 2014/26/EU establishes common standards of multi-territorial licenses and a model based on the competition between European CMOs, which are unlikely to be efficient. Therefore, the implementation of a European one-stop-shop would be an economically better solution to the digital administration of copyright and related rights.

Keywords: collective administration efficiency; cross border licensing; information asymmetries; natural monopoly; one stop shop; transaction costs; copyright; online rights; musical works; intellectual property rights; IPR; music rights; economic efficiency; collective management organisations; CMOs; moral hazard; multi-territorial licensing; Directive 2014/26/EU; EU Collective Rights Management Directive; digital administration; online music; digital music.

DOI: 10.1504/IJIPM.2014.070725

International Journal of Intellectual Property Management, 2014 Vol.7 No.3/4, pp.103 - 119

Received: 01 Nov 2014
Accepted: 03 Feb 2015
Published online: 22 Jul 2015 *

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