In this legal update, we analyse the Copyright Licensing and Rights to Benefit from Re-Sale Regulations [1]. The Regulations came into force on 18 March 2022 and are made under section 45 of the Copyright and Neighbouring Rights Act[2].
The Regulations prohibit public performance, communication, reproduction or broadcasting of a work that is copyright-protected. One can only do the aforementioned acts if:
they are licenced to do so by the Copyright Society of Tanzania (the Society),
they are authorised by the owner of the work; or
it is free to use in accordance with the Act.
In relation to “2” above, the Regulations provide a mandatory requirement for contracts between copyright owners, companies or organisations that have been entered into in Mainland Tanzania to be deposited at the Society before they become operational. The Society shall advise on the contracts and charge an administration service fee of a maximum of 1% of the contract value.
An application for the licence is made to the Society in a prescribed form (CST F.1/CST F.2). The application fees are prescribed in the Third Schedule to the Regulations. Upon successful application, the Society would issue a licence in the prescribed form (CST F.3). This licence is valid for the purpose it has been issued; for the period specified therein; and with respect to the specified user or premises.
The licence granted must be publicly displayed in a prominent and visible position by the licensee. The licence renewal must be made to the Society in writing within 30 days before expiry of the licence and subject to payment of the prescribed fees.
A licensee is obliged to notify the Society in writing within 7 days of it ceasing to carry on the licensed business. A licensee is also obliged to notify the Society in writing when a change occurs in any matter related to the licence.
The Society may revoke or suspend a licence where the licensee:
engages in activities beyond the scope of the licence;
obtains the licence by false or fraudulent representation;
is in contravention with the Act, Regulations or any other relevant written law; or
breaches the licence conditions.
The Society shall issue a 30 days’ written notice to the licensee to show cause as to why the licence should not be revoked or suspended. The Society shall revoke or suspend the licence upon failure of the licensee to file a defence as per the notice or failure to adduce sufficient reasons thereto.
Upon an unsuccessful application of the licence, the Society shall communicate the reasons for the refusal within 7 days from the date of the decision. An applicant who is aggrieved by the decision of the Society may appeal to the Minister responsible for Copyright and Neighbouring Rights (the Minister) in writing within 14 days from the date of the decision. The Minister may, within 21 days, set aside, vary or confirm the Society’s decision and inform the parties accordingly.
The Regulations protect the rights of authors of an original applied or fine artwork to a share in the proceeds of sale of that work as long as copyright subsists. According to the Regulations, this right is inalienable and shall not be waived under any circumstances. However, this right can only be realised after the first transfer of ownership of that work and shall not include an auction for charitable fundraising purposes.
The Regulations further provide that the author or their heirs are entitled to a resale rights royalty at the rate of 5% of the net sale price on the commercial resale of an artwork. The seller (and their art market professional and agent) has an obligation to pay and deposit the resale royalty. Where there are no agents of the seller, the buyer (and their art market professional and agent) shall have the obligation to pay and deposit the resale royalty.
The persons responsible for paying the resale royalty must notify the Society about the details of the work sold. Once the Society receives the notification, it shall process and inform the person providing the notification of the details on how the royalty is to be paid. Thereafter, the Society shall pay royalties (after tax deductions and the deduction of not more than 35% as administration fees) to the person whose work was sold.
The Regulations provide circumstances where royalties are not to be paid; two of them being that the sale price is less than TZS 1,000,000 (approximately USD 430) and the work is an auction for charitable purposes.
The Regulations revoke the Copyright (Licensing of Public Performance and Broadcasting) Regulations [3] and the Copyright and Neighbouring Rights (Copyrighted Works-Communication to Public) Regulations [4].
The Regulations contain a total of four Schedules, the fourth of which covers:
Distribution Rules for Public Performance and Broadcasting; and
Distribution Rules for Communication to the Public and Reproduction.
Should you wish to discuss any concerns relating to copyright and neighbouring rights, please contact Tenda Msinjili, Maria Kitambi and Oscar Mashaguri.
[1] The Copyright and Neighbouring Rights (Licensing and Rights to Benefit from Re-Sale) Regulations, G.N. No. 137 of 2022.
[2] The Copyright and Neighbouring Rights Act Cap. 218 R.E 2002.
[3] Copyright (Licensing of Public Performance and Broadcasting) Regulations, G.N. No. 328 of 2003.
[4] Copyright and Neighbouring Rights (Copyrighted Works-Communication to Public) Regulations, G.N. No. 29 of 2016.
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