The European Commission on Monday warned that royalty collecting societies which have signed up to the so-called Santiago Agreement may be in breach of European competition rules.
The purpose of the Santiago Agreement, which was notified to the EC in April 2001, is to allow participating societies to grant to online commercial users "one-stop shop" copyright licenses which include the musical repertoires of all societies and which are valid in all their territories.
In a statement, the EC explained that cross-licensing agreements reached by the societies for the use of copyright-protected material were likely to lead to "an effective lock up of national territories, transposing into the internet the national monopolies the societies have traditionally held in the offline world".
The collecting societies now have two and a half months to respond to the objections expressed by the EC.
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