The Indonesian government has issued a circular requiring businesses playing music in public spaces to pay royalties. The rule applies to commercial establishments including restaurants, cafes, hotels, shopping centers, entertainment venues, and transportation services.
New Regulations for Music Use in Commercial Spaces
According to the Law Ministry’s Director General of Intellectual Property, Hermansyah Siregar, the circular aims to clarify regulations and protect the economic rights of music creators. The government categorizes the playing of music to support business activities as “commercial utilization,” triggering the royalty obligation.
Payments will be administered through the National Collective Management Organization (LMKN), operating under existing copyright regulations. LMKN collaborates with Collective Management Organizations (LMK) who represent creators and copyright owners, and then distributes the royalties accordingly.
Streamlining Royalty Payments
LMKN Commissioner Marcell Siahaan stated the new system is designed to simplify the process for businesses. “Business actors do not need to be confused about who to pay. Just go through LMKN, and we ensure those royalties are distributed fairly and transparently to the creators, copyright holders, and related rights owners,” he said.
The Directorate General of Intellectual Property will oversee the system’s operation and conduct outreach to increase awareness of copyright obligations. The government emphasizes that royalty payments are economic rights, vital to sustaining the national music ecosystem.
Frequently Asked Questions
What types of businesses are affected by this circular?
Restaurants, cafes, hotels, shopping centers, entertainment venues, and even modes of transportation are included, as any business using music to support its activities is considered a commercial user.
How will royalty payments be handled?
Commercial users must pay royalties via the National Collective Management Organization (LMKN).
What role does the Directorate General of Intellectual Property play?
The Directorate General of Intellectual Property acts as a regulator, ensuring the system operates according to the rules and raising public awareness of copyright obligations.
It remains to be seen how readily businesses will adopt the new system, and whether the LMKN will be able to efficiently manage the collection and distribution of royalties. A possible next step could involve increased outreach to businesses to ensure compliance. Analysts expect ongoing monitoring of the system’s effectiveness will be crucial for its long-term success.
