Music production consists of the process of entering into and negotiating legal contracts at various stages due to the involvement of Intellectual Property. This article discusses a few of the contracts prevalent in the music industry. It is important to note that it is always better to obtain professional legal advice from experts before entering or negotiating any contract and this content, in no way, qualifies for the same and is for educational purposes only.
1. Work-Made-For-Hire Agreement is an agreement entered into by the producer/label and the artist where the artist’s work will constitute for work-made-for-hire and the artist shall be monetarily compensated for the same. This is an initial, the most basic and important agreement in the industry as it involves the waiver of one’s Intellectual Property Rights.
2. A Music Collaboration Agreement is signed between the producer and the artist and establishes a collaboration between them for the production of a track or an album, as the case may be. It involves a lot of negotiation as it deals with the percentage cuts that each party gets, before signing of the agreement. It is important to pay attention to the exclusivity clause of this contract as most labels enter into an exclusive-artist contract for a single track or an album, as the case may be. Similarly, a Side Artist Agreement comes into play when another (usually side/auxiliary) artist is involved to contribute to the music production process.
3. Split Sheet Agreement is one of the most important agreements in the industry and shows the distribution of profits among the artists, gained by selling the composition. This agreement aids in the quantified receipt of royalties and profits from the sale of music. It also comes in handy if and when the parties decide to register the work with a competent copyright society or agent, in order to receive royalties from the work’s exploitation.
4. Mechanical License is a licensing agreement entered into between the producer and the recording company which duly states the musical composition rights that have been granted to the company. This agreement aids in claiming mechanical royalties from the company. Similarly, a Record Company and Producer Agreement is a classic record deal in which the “rights in the recording” are transferred to the record company and the company, in turn, looks after the manufacturing, distribution and marketing of the recording. The key aspects controlled by record deals are: format, production volume, duration, exclusivity, sync and merchandising rights, sub-license rights, etc. In the above scenario, the producer agrees to deliver the master recording of the music to the record label and the label agrees to pay a pre-decided fee to the producer.[1] The producer also benefits from the sale of recording in the present case.
5. Recording Studio Rental Agreement is entered into for renting a studio. This is mainly for the production companies that are dependent on third-party recording studios to manufacture and produce their track and this agreement also includes usage of the other facilities of the studio. These agreements lay out the duration of engagement, compensation and dispute resolution mechanisms, in case things go haywire.
6. Release Agreements are made when the producer of a music/ engineer/ production company agrees to release the artist from the obligations of a previously signed contract and vice-versa. This agreement forms an evidence document that supports their independence from each other.
7. Minor’s Parental Consent and Guarantee Agreements are used in situations where the artist is below the age of 18 years and hence is not competent to enter into a contract according to the Indian laws. This agreement requires for both the minor and their parents to consent to the contract.
8. Band contracts are entered into by the members of a band in order to regulate monetary compensation, tax and other legal matters amongst themselves. The contract covers the distribution of income, band name rights, distribution of jobs, withdrawal of band members, fatality, insurance, possession of instruments/equipment and voting rights within the group.[2]
9. Distribution contracts involve the record labels/ independent musicians and the distributors. Under this agreement, only the exclusive right of distribution of the content is transferred. The key aspects covered under this contract are: the recordings covered by the contract, the distribution area, costs and payment, release, transactions with collection societies, protective rights and stock management.
AGREEMENTS BETWEEN THE SONGWRITER AND THE PUBLISHERS:
- Individual Song and Exclusive Songwriter Agreements are the most common types of songwriter-publisher agreements. In the case of an individual song agreement, the writer/lyricist transfers the copyright of the respective composition to the publisher in return of royalties. These royalties are collected every time the said composition is used. Whereas, in the exclusive agreement, the songwriter assigns all compositions (written over a specific duration), with the guarantee of a share of the income generated and usually a provision for weekly or monthly payments. All the payments made to the lyricist are considered as advances that are recoupable from their future royalties. These sums shall be deducted from any royalties that become due from record sales, downloads, sheet music, commercials, home video, television and motion picture synchronization fees, as well as from any other source of income that the publisher controls.[3]
- Under the Co-Publishing Agreement, the songwriter is the co-owner of the copyright of their songs and receives a portion of the publisher’s share of income (which is usually 50%) in addition to the songwriter’s share. Similarly, under the Participation Agreement, the writer shares in the publisher’s income, the only difference being, they do not become a co-owner of the copyright. Publishers also receive rights in compositions through the above-mentioned types of agreements. These rights do not transfer the ownership of the copyright but transfer the rights to control and administer the compositions for a specified period of time.[4]
Since the entire process of Music Production involves planning and finances, it is important to ensure that the parties involved are on the same page as each other, in order to avoid misunderstandings. Hence, contracts eliminate the possibility of confusion, uncertainty and substantial losses. A consented agreement also provides the parties with an option to approach courts or adhere to alternate modes of dispute resolution, in cases of disputes or non-enforcements of the contracts. Sale, assignment and licensing deals are much laid-back and easier to understand when documented and consented to by the collaborating parties. One shoe does not fit all, similarly, different aspects of music in different stages of production need different contracts and a standard agreement shall not work for the same.
[1] Types of Agreements related to Music Production, found at https://blog.ipleaders.in/music-agreement/
[2] iMusician, “The most important contracts in the music industry”, found at https://imusician.pro/en/resources/blog/the-most-important-contracts-in-the-music-industry
[3] Todd Brabec & Jeff Brabec, “SONGWRITER AND MUSIC PUBLISHER AGREEMENTS: A Relationship Necessary For Success, found at https://www.ascap.com/help/music-business-101/200809
[4] Todd Brabec & Jeff Brabec, “SONGWRITER AND MUSIC PUBLISHER AGREEMENTS: A Relationship Necessary For Success, found at https://www.ascap.com/help/music-business-101/200809
YLCC would like to thank Pratyusha Ganesh for her valuable insights in this article.
