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Judgment of the Presidium of the Supreme Commercial Court of 4 December 2012 № 11277/12 in the case The company “Melnitsa XXI vek” vs The Russian Author’s Society (RAO)

Point of law: how specific should be the subject of a license contract concluded under Art 1243 of the Civil Code between the user of a musical composition (licensee) and the accredited organization for the management of rights on the collective basis (RАО), in order to be recognised as being agreed upon?

Alternative attitudes: 1) such contract should specify particular compositions, which are permitted for use under the contract, otherwise the contract is considered to be unconcluded  (the view of lower courts); or 2) RАО acts in the interests of an unlimited class of persons, which includes all the right-holders in the respective field; users may use any compositions from the respective category (which number constantly grows due to new compositions being included into the repertoire of RAO), save the compositions explicitly excluded from it, hence there is no need to reflect in the contract the real use of particular compositions (the view of the panel of judges of the Supreme Commercial Court). 

Ratio decidendi: in the view of Presidium, the second approach is legally correct. Besides, the Presidium noted that the conclusion of a license contract by the user directly with the right-holder entails the termination of RAO’s right to collect remuneration for the use of corresponding objects of copyright and related rights. 

Practical consequences: the Judgment says that prior court decisions in analogous cases if inconsistent with this interpretation may be reversed in the procedure and within the limits envisaged by Art 311 of the Commercial Procedure Code

Text
All court decisions in the case
Subject areas: 
Civil law  IP-rights 

 

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