Playing music in your business in New Zealand: licences explained

A streaming account is not a business licence

A paid streaming subscription, a 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 or staff. The terms of the large consumer streaming services limit use to personal, non-commercial purposes, so an account used to fill a café, salon or shop with music falls outside what it was sold for.

Owning a copy is also different from having the right to play it in public. Under the Copyright Act 1994, playing a sound recording in public and performing a song in public are acts that only the copyright owner may do or authorise. Once music can be heard in a café, restaurant, bar, shop, hotel lobby or gym, permission is generally needed, whatever the source.

Radio and television are a partial special case, explained below, but they do not remove the need for permission altogether.

What New Zealand law says

The governing law is the Copyright Act 1994, which is administered by the Ministry of Business, Innovation and Employment.

• Section 16 gives the copyright owner the exclusive right to perform, play and show a work in public, and to authorise others to do so. Under section 29, anyone who does one of these acts other than under a licence infringes copyright.
• Section 32 splits the public use of music in two. Performing in public applies to musical and literary works, meaning the song and its lyrics. Playing in public applies to sound recordings. Under section 2, a performance includes presenting a work by means of a sound recording or a broadcast, so background music through speakers involves both.
• Section 81 allows certain non-profit clubs and societies with charitable, religious, educational or social welfare aims to play sound recordings without infringing. It does not fit commercial premises.
• Sections 87 and 87A deal with playing radio or television free of charge to the audience. They refer to the broadcast itself and to the sound recordings in it, not to the songs, and they do not apply where people pay for admission or where prices are raised because of the broadcast.

Most commercial music is licensed collectively, by licensing bodies acting for many rights holders at once. Part 8 of the Act regulates their licensing schemes, meaning the tariffs and terms they offer to whole classes of users. A scheme can be referred to the Copyright Tribunal, a state tribunal continued under Part 10 of the Act, which can confirm or vary it as it considers reasonable (sections 149 to 152). A business, or an organisation representing businesses, can apply, and the Ministry of Justice, which supports the Tribunal, states that filing a licensing dispute is free.

Two sets of rights in most commercial music

A commercially released track usually carries two separate sets of rights:

• The musical work and lyrics, which belong to the songwriters, composers and music publishers.
• The sound recording, which belongs to the record producer, usually a record label.

In New Zealand these rights are represented by two different licensing bodies: one acting for songwriters, composers and publishers, and one acting for record labels and recording artists. For most businesses the two bodies offer a single joint licence, administered on behalf of both. You deal with one licensing service and hold one licence, and the fee is then distributed by the two bodies under their own policies. The joint licence covers the repertoire those bodies control, which they describe as essentially all commercially released music.

Performers have rights of their own. Since 31 May 2023, section 174B of the Act has provided that playing a recording of a performance in public without the performer's consent infringes the performer's rights. These rights exist independently of copyright in the song or the recording (section 170). The Act frames this as a right to give or withhold consent rather than as a separate statutory right to payment.

Some uses sit outside the standard business licence. Ticketed events above a set price need event licences, and the joint licence charges an additional component where music is copied, downloaded or streamed onto a device for use in the business. If you are unsure which licences apply to you, ask for written confirmation.

How the fee is worked out

There is no single price for playing music in a business. The joint licence publishes rate schedules by industry, and the fee depends mainly on:

• Type of business. Restaurants and cafés are charged on a different scale from pubs and bars. Shops and service businesses, accommodation, gyms, workplaces and function venues each have their own schedule.
• Size of the premises. For hospitality and retail the fee rises in bands by floor area in square metres. For accommodation, the area counted is the public space where music can be heard.
• Members, classes or staff. Gyms are charged per member for background music, with separate charges for group fitness classes and on-demand classes. Music in a workplace is charged per employee, and music on hold by caller capacity.
• How music is played. Live performers, DJs and karaoke attract a per-day charge on top of background music. A separate component applies where music is copied, downloaded or streamed onto a device, and a reduced rate applies where only terrestrial radio is played.
• Events. Events with an advertised ticket price at or above a set threshold need their own licences, from each body whose rights are used.

Licences run for a year at a time and renew. Rates are published inclusive of GST and may rise each year in line with the Consumer Price Index, so the schedules change regularly. For an accurate figure, ask for a written quote based on the actual details of your premises. If music is used in more than one way, for example background music plus live entertainment or ticketed events, more than one licence or charge may apply.

If music is played without permission

Playing music in public without the necessary permission infringes copyright. Under section 120 the copyright owner can bring civil proceedings, and the court can grant damages, an injunction, an account of profits or any other relief available for infringement of a property right. In practice such claims are usually brought by a licensing body on behalf of the rights holders it represents.

• Damages. Ordinary damages compensate the rights holder. In a 2018 High Court decision concerning a bar that kept playing music after repeated letters and licence offers, compensatory damages were based on the licence fees the business would have paid.
• Additional damages. Section 121(2) lets the court award additional damages, having regard in particular to the flagrancy of the infringement and any benefit the business gained from it. In the same case the court awarded additional damages on top of the compensatory amount and granted a permanent injunction.
• Where copyright was unknown. If it is proved that the business did not know, and had no reason to believe, that copyright existed in the work, damages are not available, but the rights holder can still claim an account of profits (section 121(1)).

An occupier who gave permission for equipment to be brought onto the premises, knowing or having reason to believe it was likely to be used to infringe, can also be liable (section 39).

There is also a criminal offence. Under section 131(3), a person who causes a sound recording to be played in public, or a musical work to be performed, knowing that this infringes copyright, commits an offence punishable by a fine or imprisonment of up to five years. The offence requires knowledge, and the presumptions that help claimants in civil cases do not apply to it (section 131(7)).

Performers' rights carry similar civil remedies, including additional damages for flagrant infringement (section 196).

How a directly licensed catalogue works

Collective licensing is not the only route. The test in section 29 is whether you act under a licence from the copyright owner. Where one company owns or controls both the musical works and the sound recordings in a catalogue, it can grant that permission directly, without a licensing body. This is usually called direct licensing. The joint licence, by contrast, covers the repertoire controlled by its two licensing bodies, and those bodies themselves mention direct arrangements with copyright owners, or music outside their repertoire, as alternatives.

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 premises 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;
• commercial music used for fitness classes, functions or events.

If any of these are also used on your premises, they need their own permission, which may mean a collective licence for that part of your music use.

Performers' consent under section 174B sits alongside copyright. Whichever provider you use, it is reasonable to ask how that right is dealt with for the recordings in its catalogue.

Keep your paperwork in order. In civil proceedings the Act presumes certain facts about authorship in the claimant's favour until the contrary is proved (section 126), so your records are how you show where your music comes from. Hold on to the licence certificate for each venue, the provider's details, information identifying the catalogue (for example a track list or catalogue numbers) 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 licensing body'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 quieter mornings to busier evenings.
• Separate zones. Each area of a venue, such as the dining room, terrace or bar, can play its own programme independently.
• Keeps playing offline. Tracks are downloaded in advance, so 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 verified by QR code.
• In-store announcements. Short announcements, 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.