PROPOSED CHANGES TO SCREENRIGHTS COMPETING CLAIM RESOLUTION PROCEDURES
Screenrights is seeking your feedback on proposed changes to the competing claims resolution procedures. Submissions are welcomed until 5pm AEST Wednesday 17 May 2023.
Overview of Current Competing Claim Resolution Procedures
When two or more members claim the same royalties, Screenrights will notify those members that there is a competing claim.
Members are encouraged to review their claims and to try to reach a resolution themselves. Members can also use the Screenrights’ Competing Claim Resolution Procedures (CCRP), which pathways include the Express Resolution Process (ERP) and Alternative Dispute Resolution (ADR) procedures.
The ERP provides express pathways to resolve certain competing claims by applying presumptions based on Australian copyright law, standard industry practice and industry-agreed contracts.
The ADR procedures include a process through which members make submissions and provide supporting documentation to Screenrights to justify their claims. Screenrights then examines the submissions and issues a written determination (an ‘Internal Determination’). There are currently significant delays and a large backlog of matters tied up in the Internal Determination process.
While it is Screenrights’ view that the ERP is effective, an internal review of the effectiveness of the current ADR procedures has determined that the high levels of administrative engagement and costs of those procedures to the general membership are disproportionate to the amounts in dispute. The review has resulted in a recommendation that Screenrights’ ADR procedures should be less determinative and more facilitative. Screenrights is therefore proposing the changes set out below.
PROPOSED CHANGE 1: New Assisted Resolution Process (ARP)
A more cost-effective, facilitative approach to helping members resolve competing claims
Screenrights is proposing to replace the CCRP with a New Assisted Resolution Process (ARP) which includes:
- Structured pathways to ensure good-faith participation in efforts to resolve competing claims by all parties;
- A less determinative, more facilitative and efficient process that reduces costs, to keep expenses down to the benefit of all members; and
- Time limits to ensure the timely release of royalties to the relevant rightsholder.
The details of this proposed change are set out below.
CURRENT POLICY: Screenrights' Competing Claim Resolution Procedures (CCRP)
| Step 1 | Step 2 | Step 3 | Step 4 |
|---|---|---|---|
| SELF SERVICE: Informal approaches to resolution by the parties, including temporary resolution. | EXPRESS RESOLUTION PROCESS (ERP): The ERP is a framework for the timely resolution of non-complex Competing Claims utilising a simple set of Presumptions based on principles of Australian copyright and contract law and standard industry agreements. This is the process: 1. Screenrights checks whether a relevant Presumption under the ERP may be applicable; 2. If Screenrights identifies that a relevant Presumption may apply, the ERP is initiated; 3. If a Presumption is identified as applying, Screenrights notifies the parties to the Competing Claim that the ERP will be applied to assist in the resolution of the Competing Claim. The parties have sixty (60) days from the date of notice to submit a written application containing evidence to challenge the application of the Presumption; 4. If no challenge is received, the ERP resolves the Competing Claim, the claims are modified accordingly and the royalties are paid out. 5. If a challenge is raised to the application of a presumption, Screenrights Screenrights assesses the challenger’s submissions and supporting material to determine if it successfully overturns the application. 6. If a challenge is unsuccessful, the ERP resolves the competing claim. 7. If a challenge successfully overturns the application of the presumption, the matter may enter ADR. | ALTERNATIVE DISPUTE RESOLUTION (ADR) PROCEDURE: 1. Internal Determination (a) An Internal Determination may occur following a request by one of the parties, or in the CCF year may be initiated by Screenrights; (b) Within five (5) days following a Member request or upon Screenrights initiative in the CCF year, Screenrights will send the parties written notice to submit within 30 days of notice a written application up to five (5) pages and supporting evidence attached to a fully completed Internal Determination Submission Form for a Screenrights Representative to consider; (c) The Screenrights Representative will make the Internal Determination (which is a decision in writing) based on all submissions received and such other material available to the Screenrights Representative that in the Screenrights Representative’s view is relevant to the Competing Claim; (d) If Screenrights does not receive a written application from a party within thirty (30) days of Screenrights’ notice, an Internal Determination may be made in favour of the other party/parties without further reference to that party; (e) If a decision is not made in a Member's favour and that Member does not submit a request for Independent Expert Determination within five (5) working days from the notice of the decision, the status of their claim is made ‘withdrawn’ or is amended in accordance with the Internal Determination. | ADR PROCEDURE (CONTINUED): 2. Expert Determination (a) If a Member is not satisfied with an Internal Determination made by Screenrights under the ADR Procedure, they may request for the determination to be referred to an Independent Expert chosen from a panel which has been put together by an independent organisation; (b) The Member needs to submit an Independent Expert Determination Form to Screenrights within five (5) working days of receiving the relevant Internal Determination from Screenrights. The form includes guidance on the range of past costs for Independent Expert Determinations; (c) Where Screenrights is of the view that a previous Expert Determination could serve as a precedent to support the Internal Determination in question, Screenrights notifies the Member of the potential precedent. If the Member still wishes to proceed, they must advise Screenrights in writing within five (5) working days of the notice; (d) Where a potential precedent has been identified by Screenrights, the Independent Expert will be requested to make a determination on whether the suggested precedent is in fact applicable to the determination in question, in addition to making the determination itself. The applicability of the precedent has cost implications; (e) If the Member accepts the cost estimate, the Independent Expert will proceed to make a determination following receipt by Screenrights of a signed Expert Determination Agreement, which is an agreement between the relevant parties to the Competing Claim, Screenrights and the Independent Expert. The agreement includes an acknowledgement that a summary of the resulting determination will be published and that the party requesting the Expert Determination will pay costs where appropriate; (f) An Expert Determination is made on the parties’ written submissions and Screenrights makes all reasonable efforts to ensure that the Independent Expert completes the determination within thirty (30) days from receipt of the signed Expert Determination Agreement. |
PROPOSED CHANGE 1: New Assisted Resolution Process (ARP) - A more cost-effective, facilitative approach to helping members resolve competing claims
| Step 1 | Step 2 | Step 3 | Step 4 |
|---|---|---|---|
| SELF SERVICE: Informal approaches to resolution by the parties, including temporary resolution (no change). | ERP: 1. Screenrights checks whether a relevant Presumption under the ERP may be applicable; 2. If Screenrights identifies that a relevant Presumption may apply, the ERP is initiated; 3. If no Presumption is identified as applying, Screenrights notifies the parties to the Competing Claim and encourages them to resolve the competing claim directly with the other party/ies. Screenrights also informs them that they have the option to request that their matter go to the Assisted Resolution Process (ARP). 4. If a Presumption is identified as applying, Screenrights notifies the parties to the Competing Claim that the ERP will be applied to assist in the resolution of the Competing Claim. Per the current CCRP, parties will have sixty (60) days from the date of notice to submit a written application containing evidence to challenge the application of the Presumption; 5. If no challenge is received, the ERP resolves the Competing Claim, the claims are modified accordingly and the royalties are paid out. 6. If a challenge to the application of a presumption is successful, the matter goes straight into Phase 1 of the ARP. | ASSISTED RESOLUTION PROCESS (ARP): If a Member requests that their matter enter the ARP, the following Phases are applied, in order of application: Phase 1: 30 days. All parties are notified and have 30 days to confirm or amend their claims. If the claim is resolved, Screenrights will close the conflict and pay royalties accordingly. Failure to act within deadline will be considered a withdrawal of the claim, and Screenrights will amend the claim accordingly. Phase 2: 60 days. Where the competing claim persists, Screenrights will ask the parties to provide relevant legal evidence of their claim (e.g. contracts) plus written submissions within 60 days. Screenrights will review documents for relevance and compliance, and advise parties if they do not comply. If one party does not respond, or provide adequate documentation within 60 days, Screenrights will close the conflict and pay royalties to the complying party. If no party responds or complies, Screenrights will close the conflict and redistribute the royalties. | ARP (CONTINUED): Phase 3: 180 days. Where the conflict persists after documents have been submitted, Screenrights will notify parties and request they resolve the conflict through direct negotiations within 180 days. Parties must actively engage in negotiation, e.g. participate in calls, meetings and communications, and provide evidence of their claims to the other party/ies. If one party does not respond or actively engage within the deadline, Screenrights will treat their claim as withdrawn. If only one party engages in the process, they must document their actions. Screenrights will close the conflict and pay royalties to the participating party. If neither party communicates their outcome to Screenrights within 180 days, the conflict will be closed, the claim closed and retained royalties will be redistributed. If parties reach agreement, they must provide the terms and amend their claim accordingly. Screenrights will then pay the royalties held. If parties fail to reach agreement within 180 days, they may inform Screenrights of their intention to initiate legal proceedings, arbitration, or mediation. Phase 4: If parties fail to reach agreement within 180 days, they may inform Screenrights of their intention to initiate legal proceedings, arbitration or mediation. Parties must upload evidence within 60 days of proceedings commencing. Parties must advise Screenrights of the outcome of proceedings, so Screenrights can amend the claim and pay accordingly. Royalties subject to a competing claim that is not resolved between the parties or through ADR will be forfeited at the end of the statutory distribution period and redistributed across usage events in the following distribution period. |
PROPOSED CHANGE 2: A new Presumption 11 under the Express Resolution Process (ERP)
The ERP currently utilises seven (7) presumptions based on principles of Australian copyright and contract law and standard industry agreements as set out in the Competing Claim Resolution Procedures (CCRP).
In October 2020, the Australian Competition and Consumer Commission (ACCC) authorised ASDACS to change its constitution to enable ASDACS to receive an assignment of retransmission rights from its members.
The ASDACS’ Constitution was amended on 29 October 2020 to reflect this authorisation. Effectively, the ASDACS conditions of membership require a director member to enter into an agreement assigning to ASDACS all past and present “retransmission rights” which the Director owns and, most critically, all such future rights that the director would own but for that agreement.
The effect is that a director member of ASDACS signed under the new terms cannot assign their copyright to another party, such as a producer, as they have already assigned it to ASDACS.
“Retransmission Rights” assigned include rights under s 98 of the Act and therefore include Screenrights statutory retransmission royalties.
Therefore, for cinematograph films produced on or after 1 January 2021, it is reasonable to assume that, for members that have entered into the new agreement, ASDACS has been assigned the relevant rights via an assignment from the director.
Therefore ASDACS will jointly (with the producer/s of a cinematograph film) be eligible to receive statutory royalties for retransmission and, in the absence of any indication to the contrary, ASDACS and the producer/s are likely to share such royalties in equal shares as tenants in common.
It is proposed that a new presumption be added to the current set of presumptions, as set out below.
Presumption 11
The assignment from Directors to ASDACS of rights relating to Statutory Royalties for retransmission in accordance with the ASDACS Constitution applies and therefore for a cinematograph film that commenced production on or after 1 January 2021 such royalties are payable 50% to ASDACS and 50% to the producer/s.
The Presumption does not apply to cinematograph films that commenced production prior to 1 January 2021 and is subject to the exceptions set out in the Copyright Act.
MEMBER ENGAGEMENT PROCESS
How can I have my say on the proposed changes?
Screenrights is seeking your feedback on the proposed changes, specifically:
- Do you agree/disagree with the proposed changes?
- What other things should be considered in making any changes?
- What further information do you need to decide?
You can make a submission by:
- Completing an online survey here
- Requesting a consultation to discuss the proposed changes.
The closing date and time for submissions is 5pm AEST Wednesday 17 May 2023.