Playing music in your business in Malta: licences explained

A streaming account is not a business licence

A subscription to a streaming app or video platform, or CDs and downloads you have bought, give you access to music for your own listening. They do not give you permission to play that music to customers. The terms of the large consumer streaming services limit use to personal, non-commercial purposes, so a personal account used to fill a café, salon, shop or gym with music falls outside what you agreed to.

Owning a copy is not the same as owning the rights. Under the Copyright Act, communicating a musical work to the public and performing it in public are acts that only the copyright owner may authorise. Once recorded music plays in a restaurant, bar, shop, hotel lobby or fitness studio, it is being used in public, and permission is needed.

Radio and television work the same way: a broadcaster's licence covers its broadcasts, not a business playing them to people on its premises. A music licence is also not one of the permits the Government issues when you set up a business, so a trading licence does not settle the question of music.

What the Copyright Act says

The main law is the Copyright Act, Chapter 415 of the Laws of Malta, as amended.

• Article 7(1) gives the owner of copyright in a musical or literary work the exclusive right to authorise or prohibit, among other acts, the communication of the work to the public and its display or performance to the public.
• Article 2 defines communication to the public as the transmission of a work, performance or sound recording to the public by wire or wireless means. For article 19, it also includes making the sounds of a recording audible to the public, as when music plays through a venue's speakers.
• Article 19 covers recordings released for commercial purposes: when such a recording is used for broadcasting or any communication to the public, the user owes a single equitable remuneration to the performers and the producer, to be shared equally between them.
• Article 9 lists exceptions. They are narrow, for example use during religious celebrations or official celebrations organised by a public authority, and none of them is aimed at background music in commercial premises.

Most commercial music is licensed collectively, by collecting societies acting for many rights holders at once. Article 52 allows authors and other rights holders to authorise a collecting society to manage their economic rights. Under the Control of the Establishment and Operation of Societies for the Collective Administration of Copyright Regulations (S.L. 415.01), which transpose the EU Directive on collective management, a society may not operate in Malta unless it has been approved by the Copyright Board, set up under article 45 of the Act. The Board also approves the tariffs a society charges and monitors compliance with the regulations. It forms part of the Industrial Property Registrations Directorate within the Commerce Department.

Disputes with a collecting society about licensing conditions go to the First Hall of the Civil Court, or to mediation or arbitration if both sides agree (regulations 41 and 42).

Two separate sets of rights

A piece of recorded music usually carries two layers of rights:

• The musical work and the lyrics, which belong to songwriters, composers and music publishers.
• The sound recording and the performance captured on it, which belong to the record producer, usually a label, and to the performers. Maltese law calls these neighbouring rights.

On the authors' side, licences for businesses in Malta are issued by a collecting society approved by the Copyright Board. It is a foreign-based society representing songwriters, composers and publishers, it works through a local agent, and through agreements with sister societies abroad it licenses most international repertoire as well as Maltese music.

The recording side is organised differently. Article 19 requires the equitable remuneration for performers and producers to be paid to a collecting society that represents both groups or, where there is no such society, to the producer of the recording, who must pass half on to the performers. Studies by performers' organisations report that Malta has no collecting society for performers, and we found no published tariff for this remuneration, so the practical arrangements are less settled than on the authors' side. If unsure, ask the licensing body or your music provider to confirm in writing which rights its licence covers.

How the fee is worked out

There is no single price for playing music in a business. Collecting societies publish separate tariffs for different kinds of premises, such as shops and stores, restaurants and cafés, hotels and cinemas. Each tariff must be approved by the Copyright Board and published in the Government Gazette. Under the regulations, tariffs should normally reflect the economic benefit of using the music and take account of the type of business. In the published tariffs, the main factors are:

• Type of premises and how music is used. Background music is charged differently from featured music such as live bands, DJs, discos or karaoke, which can be charged as a share of the fees paid to performers or of admission receipts, or by capacity for each event.
• Size. For shops this is typically the area in square metres where music can be heard; for restaurants and cafés, the number of seats or covers in each room.
• The equipment used. A single small radio or television can attract a lower rate than a CD player, music system or jukebox, and where several kinds of equipment can be heard in the same room, the charges are combined.

Licences are generally paid annually in advance, with VAT added, and rates can be adjusted in line with official inflation. Societies are required to resubmit their tariffs to the Copyright Board every two years. The published tariffs also apply a higher rate in the first year where music was played before a licence was obtained. Because more than one set of rights can be involved, a business may need more than one licence for the same music. For an accurate figure, ask for a written quote based on the actual details of your premises.

If music is played without permission

Under article 42 of the Copyright Act, anyone who does, or causes another person to do, an act controlled by copyright or neighbouring rights without a licence from the rights holder infringes those rights. Playing protected music to the public without the necessary permission falls into this category.

Under article 43, the rights holder, or a collecting society acting for it, can bring a civil action before the First Hall of the Civil Court. The court can:

• order the payment of damages, or of a fine set according to a scale prescribed by the Minister;
• order the infringer to hand over the profit made from the infringement, unless the defendant proves that they were not aware, and could not reasonably have been aware, that the work was protected;
• award additional damages where the circumstances justify it, taking into account in particular how flagrant the infringement was and any benefit the defendant gained.

The Enforcement of Intellectual Property Rights (Regulation) Act (Chapter 488) adds further rules. Damages are to be commensurate with the actual prejudice suffered, and the court may instead set a lump sum that includes at least the royalties or fees that would have been due had permission been requested (article 12). The same Act provides for measures to preserve evidence and for injunctions against continued infringement.

The Criminal Code also contains a copyright offence, in article 298B. It is aimed at people who, in the course of trade or for gain, reproduce, sell or distribute infringing articles, or hold them for that purpose, and proceedings can only be brought on the complaint of the injured party. Whether it could apply to music played in a venue depends on the facts of the case.

A licence also covers only what it describes: music played after it has ended, or live music it does not mention, is unlicensed.

How a directly licensed catalogue works

Collective licensing is not the only route. Under article 42 of the Copyright Act, the question is whether you hold a licence from the rights holder. The licensing body for songwriters itself states that a business playing none of its repertoire does not need its licence. Where one company owns or controls both the musical works and the recordings in a catalogue, it can grant that permission directly. This is usually called direct licensing.

A direct licence covers what its terms say it covers. Typically that means the tracks in the provider's catalogue, played through the provider's service, at the venues named in the licence, for as long as the subscription is active. It does not cover:

• radio or television switched on in the venue;
• live music, DJs or karaoke;
• your own playlists, a staff member's phone or another streaming service;
• music from other sources used for classes, events or private functions.

Anything else played on your premises needs its own permission, which may mean a collective licence for that part of your music use.

The performers' and producers' remuneration under article 19 deserves its own question, because the Act ties it to the public use of commercially released recordings rather than to society membership. Ask any provider, Mublic included, how it is dealt with for the recordings it supplies, and keep the answer on file.

Keep your paperwork in order. If anyone asks about the music in your venue, your records show where it comes from: keep the licence certificate for each venue, the provider's details, information identifying the catalogue and the dates the service was in use.

How Mublic works

Mublic is a background music service for cafés, restaurants, shops, hotels and gyms. The catalogue was produced by Mublic and is not part of any collecting society's repertoire, and the licence to play it in your venue is included in the subscription.

• Music suited to your sector. Programmes are put together for each type of business, and the atmosphere changes through the day, from calmer mornings to livelier evenings.
• Separate zones. Each area of a venue, such as the dining room, terrace or bar, can play its own programme.
• Keeps playing offline. Tracks are downloaded in advance, so the music continues if the internet connection drops.
• A certificate for every venue. With a paid subscription, each venue receives a licence certificate that can be checked by scanning its QR code.
• In-store announcements. Short messages, such as offers or closing times, can be scheduled between tracks.
• Free trial. You can try the service for 7 days without entering a card. The trial is for trying the service; the licence certificate is issued once a paid subscription starts.

The licence covers only the Mublic catalogue. Radio, television, live music or another music service playing in the venue falls outside it.

You can start a free trial, see the pricing, or set up your venue.