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17 U.S.C. § 1004 — Royalty payments
Federal law — U.S. Code and appendices · legal_authorities
**(a) Digital Audio Recording Devices.—**
(1) **Amount of payment.—** — The royalty payment due under section 1003 for each digital audio recording device imported into and distributed in the United States, or manufactured and distributed in the United States, shall be 2 percent of the transfer price. Only the first person to manufacture and distribute or import and distribute such device shall be required to pay the royalty with respect to such device.
(2) **Calculation for devices distributed with other devices.—** — With respect to a digital audio recording device first distributed in combination with one or more devices, either as a physically integrated unit or as separate components, the royalty payment shall be calculated as follows:
(A) If the digital audio recording device and such other devices are part of a physically integrated unit, the royalty payment shall be based on the transfer price of the unit, but shall be reduced by any royalty payment made on any digital audio recording device included within the unit that was not first distributed in combination with the unit.
(B) If the digital audio recording device is not part of a physically integrated unit and substantially similar devices have been distributed separately at any time during the preceding 4 calendar quarters, the royalty payment shall be based on the average transfer price of such devices during those 4 quarters.
(C) If the digital audio recording device is not part of a physically integrated unit and substantially similar devices have not been distributed separately at any time during the preceding 4 calendar quarters, the royalty payment shall be based on a constructed price reflecting the proportional value of such device to the combination as a whole.
(3) **Limits on royalties
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Source file: Laws/federal/codes/united-states-code/title-17/section-1004-royalty-payments--6a08c718a8.md
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Source location: Title 17, Chapter 10, § 1004; chapter-010-digital-audio-recording-devices-and-media.md
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**(a) Digital Audio Recording Devices.—**
(1) **Amount of payment.—** — The royalty payment due under section 1003 for each digital audio recording device imported into and distributed in the United States, or manufactured and distributed in the United States, shall be 2 percent of the transfer price. Only the first person to manufacture and distribute or import and distribute such device shall be required to pay the royalty with respect to such device.
(2) **Calculation for devices distributed with other devices.—** — With respect to a digital audio recording device first distributed in combination with one or more devices, either as a physically integrated unit or as separate components, the royalty payment shall be calculated as follows:
(A) If the digital audio recording device and such other devices are part of a physically integrated unit, the royalty payment shall be based on the transfer price of the unit, but shall be reduced by any royalty payment made on any digital audio recording device included within the unit that was not first distributed in combination with the unit.
(B) If the digital audio recording device is not part of a physically integrated unit and substantially similar devices have been distributed separately at any time during the preceding 4 calendar quarters, the royalty payment shall be based on the average transfer price of such devices during those 4 quarters.
(C) If the digital audio recording device is not part of a physically integrated unit and substantially similar devices have not been distributed separately at any time during the preceding 4 calendar quarters, the royalty payment shall be based on a constructed price reflecting the proportional value of such device to the combination as a whole.
(3) **Limits on royalties.—** — Notwithstanding paragraph (1) or (2), the amount of the royalty payment for each digital audio recording device shall not be less than $1 nor more than the royalty maximum. The royalty maximum shall be $8 per device, except that in the case of a physically integrated unit containing more than 1 digital audio recording device, the royalty maximum for such unit shall be $12. During the 6th year after the effective date of this chapter, and not more than once each year thereafter, any interested copyright party may petition the Copyright Royalty Judges to increase the royalty maximum and, if more than 20 percent of the royalty payments are at the relevant royalty maximum, the Copyright Royalty Judges shall prospectively increase such royalty maximum with the goal of having no more than 10 percent of such payments at the new royalty maximum; however the amount of any such increase as a percentage of the royalty maximum shall in no event exceed the percentage increase in the Consumer Price Index during the period under review.
**(b) Digital Audio Recording Media.—** The royalty payment due under section 1003 for each digital audio recording medium imported into and distributed in the United States, or manufactured and distributed in the United States, shall be 3 percent of the transfer price. Only the first person to manufacture and distribute or import and distribute such medium shall be required to pay the royalty with respect to such medium.
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Federal law — U.S. Code and appendices · legal_authorities
As used in this chapter, the following terms have the following meanings:
(1) A “digital audio copied recording” is a reproduction in a digital recording format of a digital musical recording, whether that reproduction is made directly from another digital musical recording or indirectly from a transmission.
(2) A “digital audio interface device” is any machine or device that is designed specifically to communicate digital audio information and related interface data to a digital audio recording device through a nonprofessional interface.
(3) A “digital audio recording device” is any machine or device of a type commonly distributed to individuals for use by individuals, whether or not included with or as part of some other machine or device, the digital recording function of which is designed or marketed for the primary purpose of, and that is capable of, making a digital audio copied recording for private use, except for—
(A) professional model products, and
(B) dictation machines, answering machines, and other audio recording equipment that is designed and marketed primarily for the creation of sound recordings resulting from the fixation of nonmusical sounds.
(4)
(A) A “digital audio recording medium” is any material object in a form commonly distributed for use by individuals, that is primarily marketed or most commonly used by consumers for the purpose of making digital audio copied recordings by use of a digital audio recording device.
(B) Such term does not include any material object—
(i) that embodies a sound recording at the time it is first distributed by the importer or manufacturer; or
(ii) that is primarily marketed and most commonly used by consumers either for the purpose of making copies of motion pictures or other audiovisual
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Appointment.—** The Librarian of Congress shall appoint 3 full-time Copyright Royalty Judges, and shall appoint 1 of the 3 as the Chief Copyright Royalty Judge. The Librarian shall make appointments to such positions after consultation with the Register of Copyrights.
**(b) Functions.—** Subject to the provisions of this chapter, the functions of the Copyright Royalty Judges shall be as follows:
(1) To make determinations and adjustments of reasonable terms and rates of royalty payments as provided in sections 112(e), 114, 115, 116, 118, 119, and 1004.
(2) To make determinations concerning the adjustment of the copyright royalty rates under section 111 solely in accordance with the following provisions:
(A) The rates established by section 111(d)(1)(B) may be adjusted to reflect—
(i) national monetary inflation or deflation; or
(ii) changes in the average rates charged cable subscribers for the basic service of providing secondary transmissions to maintain the real constant dollar level of the royalty fee per subscriber which existed as of the date of October 19, 1976,
except that—
(I) if the average rates charged cable system subscribers for the basic service of providing secondary transmissions are changed so that the average rates exceed national monetary inflation, no change in the rates established by section 111(d)(1)(B) shall be permitted; and
(II) no increase in the royalty fee shall be permitted based on any reduction in the average number of distant signal equivalents per subscriber.
The Copyright Royalty Judges may consider all factors relating to the maintenance of such level of payments, including, as an extenuating factor, whether the industry has been restrained by subscriber rate regulating authorities from increas
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Federal law — U.S. Code and appendices · legal_authorities
Page 212
TITLE 17—COPYRIGHTS
§ 1003
(b) DEVELOPMENT
OF
VERIFICATION
PROCE-
DURE.—The Secretary of Commerce shall estab-
lish a procedure to verify, upon the petition of
an interested party, that a system meets the
standards set forth in subsection (a)(2).
(c) PROHIBITION ON CIRCUMVENTION OF THE SYS-
TEM.—No person shall import, manufacture, or
distribute any device, or offer or perform any
service, the primary purpose or effect of which
is to avoid, bypass, remove, deactivate, or other-
wise circumvent any program or circuit which
implements, in whole or in part, a system de-
scribed in subsection (a).
(d) ENCODING OF INFORMATION ON DIGITAL MUSI-
CAL RECORDINGS.—
(1) PROHIBITION ON ENCODING INACCURATE IN-
FORMATION.—No person shall encode a digital
musical recording of a sound recording with
inaccurate information relating to the cat-
egory code, copyright status, or generation
status of the source material for the record-
ing.
(2) ENCODING OF COPYRIGHT STATUS NOT RE-
QUIRED.—Nothing in this chapter requires any
person engaged in the importation or manu-
facture of digital musical recordings to encode
any such digital musical recording with re-
spect to its copyright status.
(e) INFORMATION ACCOMPANYING TRANSMISSIONS
IN DIGITAL FORMAT.—Any person who transmits
or otherwise communicates to the public any
sound recording in digital format is not required
under this chapter to transmit or otherwise
communicate the information relating to the
copyright status of the sound recording. Any
such person who does transmit or otherwise
communicate such copyright status information
shall transmit or communicate such informa-
tion accurately.
(Added Pub. L. 102–563, § 2, Oct. 28, 1992, 106 Stat.
4240.)
SUBCHAPTER C—ROYALTY PAYMENTS
§ 1003. Obligation to mak
Source: Supplied 2024 U.S. Code historical extraction · 17 U.S.C. § 1004
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