US Terrestrial Radio Performance Exemption

The US Terrestrial Broadcast Performance Exemption

Unlike almost every other developed nation in the world, the United States does not recognize a full public performance right for sound recordings on terrestrial broadcast radio (AM/FM). This legal discrepancy represents one of the most significant structural 'blind spots' in global music copyright.

1. The Legal Loophole (17 U.S.C. § 114) The U.S. Copyright Act grants an exclusive public performance right to musical compositions, but historically denied it to sound recordings. While the Digital Performance Right in Sound Recordings Act of 1995 created a performance right for *digital* transmissions (satellite, internet streaming, webcast), it explicitly left traditional AM/FM terrestrial radio stations exempt. * Composition Side (ASCAP/BMI/SESAC/GMR): Broadcasters pay public performance royalties to songwriters and publishers. * Sound Recording Side (Artists/Labels): Broadcasters pay zero public performance royalties to performing artists or record labels.

2. Global Neighboring Rights and Reciprocity Loss Outside the United States, collective management organizations (CMOs) like PPL (UK) or GVL (Germany) collect Neighboring Rights royalties for both compositions and sound recordings played on AM/FM radio, television, and public venues. Because neighboring rights are distributed based on reciprocity between countries: * Since the US does not collect royalties for foreign sound recordings played on US AM/FM radio, foreign CMOs are not legally required to distribute radio performance royalties to American artists. * As a result, American recording artists and session musicians lose out on hundreds of millions of dollars in global broadcast royalties.

3. Strategic Workarounds Independent and major U.S. artists can bypass this lack of federal reciprocity by registering directly with international CMOs (like PPL or GVL) or working with specialist neighboring rights administrators who can claim royalties in foreign territories where local rules allow direct collection.