Rule2026-04627
Determination of Rates and Terms for Digital Performance of Sound Recordings by New Subscription Services and Making of Ephemeral Copies To Facilitate Those Performances (NSS V)
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
March 10, 2026
Effective
March 10, 2026
Issuing agencies
Library of CongressCopyright Royalty Board
Abstract
The Copyright Royalty Judges publish a final rule governing the rates and terms for the digital performances of sound recordings by new subscription services and for the making of ephemeral recordings necessary to facilitate those transmissions for the period commencing January 1, 2026, and ending on December 31, 2030.
Full Text
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<title>Federal Register, Volume 91 Issue 46 (Tuesday, March 10, 2026)</title>
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[Federal Register Volume 91, Number 46 (Tuesday, March 10, 2026)]
[Rules and Regulations]
[Pages 11471-11474]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-04627]
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LIBRARY OF CONGRESS
Copyright Royalty Board
37 CFR Part 383
[Docket No. 23-CRB-0013-NSR (2026-2030)]
Determination of Rates and Terms for Digital Performance of Sound
Recordings by New Subscription Services and Making of Ephemeral Copies
To Facilitate Those Performances (NSS V)
AGENCY: Copyright Royalty Board (CRB), Library of Congress.
ACTION: Final rule.
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SUMMARY: The Copyright Royalty Judges publish a final rule governing
the rates and terms for the digital performances of sound recordings by
new subscription services and for the making of ephemeral recordings
necessary to facilitate those transmissions for the period commencing
January 1, 2026, and ending on December 31, 2030.
DATES: Effective March 10, 2026.
Applicability date: The regulations apply to the license period
beginning January 1, 2026, and ending December 31, 2030.
ADDRESSES: Docket: For access to the docket, go to eCRB, the Copyright
Royalty Board's electronic filing and case management system, at
<a href="https://app.crb.gov/">https://app.crb.gov/</a>, and search for docket number 23-CRB-0013-NSR
(2026-2030).
FOR FURTHER INFORMATION CONTACT: Anita Brown, CRB Program Specialist,
at (202) 707-7658 or <a href="/cdn-cgi/l/email-protection#395a4b5b7955565a175e564f"><span class="__cf_email__" data-cfemail="87e4f5e5c7ebe8e4a9e0e8f1">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
Background
On December 19, 2024, the Copyright Royalty Judges published a
proposed rule governing the rates and terms for the digital
performances of sound recordings by new subscription services that
provide transmissions to residential subscribers as part of a cable or
satellite television bundle and for the making of ephemeral recordings
necessary to facilitate those transmissions for the period commencing
January 1, 2026, and ending on December 31, 2030. 89 FR 103722. The
rates and terms in the proposed rule were the subject of a settlement
between SoundExchange, Inc., Sirius XM Inc., and Stingray Music USA
Inc. Settling Parties' Joint Motion to Adopt Settlement, Docket No. 23-
CRB-0013-NSR (2026-2030) (``NSS V''). Those who would be bound by the
terms, rates, or other determination set by the agreement were given
the opportunity to comment and participants in the NSS V proceeding
were given the opportunity to object to any or all of the proposed
regulations. In response to a comment from the settling parties, the
Judges published a correction to the proposed rule on February 10,
2025, to correct the omission of certain parentheses in the rate
adjustment formulas. 90 FR 9224. The correction extended the comment
period through March 12, 2025.
The Judges received one additional comment to the proposed rule
from David Powell. Mr. Powell is not a participant in the NSS V
proceeding and thus is not entitled to object to the settlement. To the
extent he would be bound by the terms, rates, or other determination
set by the agreement, his comment did not contain ``any comprehensible
basis'' for deviating from the settlement. Order 6 Denying Powell
Motions, Docket No. 23-CRB-0013-NSR (2026-2030).
The Judges ``may decline to adopt the agreement as a basis for
statutory terms and rates for participants that are not parties to the
agreement,'' only ``if any
[[Page 11472]]
participant [in the proceeding] objects to the agreement and the
[Judges] conclude, based on the record before them if one exists, that
the agreement does not provide a reasonable basis for setting statutory
terms or rates,'' 17 U.S.C. 801(b)(7)(A)(ii), or where the negotiated
agreement includes provisions that are contrary to the provisions of
the applicable licenses or otherwise contrary to statutory law. No NSS
IV participant has objected to the settlement. The Register of
Copyrights has completed her review of the CRB's Final Rule for legal
error, under 17 U.S.C. 803(f)1)(D), and will not be issuing any
corrections. In the absence of any objection from a participant, and in
the absence of any cognizable indication that the Final Rule includes
provisions that are contrary to the applicable licenses or otherwise
contrary to statutory law, the provisions of 17 U.S.C. 801(b)(7)(A)
direct the Judges to adopt the Final Rule.\1\ Therefore, the Judges
adopt the terms and rates as proposed. The Judges find that under the
circumstances of this proceeding and this settlement, adoption of the
Final Rule is directed by the statute, and that such directed adoption
is principally a ministerial function by the Judges.
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\1\ The provisions of 37 CFR 383.4 in the Final Rule do not
limit the statutory obligations in 17 U.S.C. 114(g)(5) or (6).
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List of Subjects in 37 CFR Part 383
Copyright, Sound recordings, Webcasters.
Final Regulations
0
For the reasons set forth in the preamble, the Copyright Royalty Judges
revise 37 CFR part 383 to read as follows:
PART 383--RATES AND TERMS FOR SUBSCRIPTION TRANSMISSIONS AND THE
REPRODUCTION OF EMPHEMERAL RECORDINGS BY CERTAIN NEW SUBSCRIPTION
SERVICES
Sec.
383.1 General.
383.2 Definitions.
383.3 Royalty fees for public performances of sound recordings and
the making of ephemeral recordings.
383.4 Distribution of royalties.
383.5 Auditing payments and distributions.
383.6 Terms for making payment of royalty fees.
Authority: 17 U.S.C. 112(e), 114, and 801(b)(1).
Sec. 383.1 General.
(a) Scope. This part establishes rates and terms of royalty
payments for the public performance of sound recordings in certain
digital transmissions by Licensees in accordance with the provisions of
17 U.S.C. 114, and the making of certain ephemeral recordings by
Licensees in accordance with the provisions of 17 U.S.C. 112(e), during
the period commencing January 1, 2026, and continuing through December
31, 2030.
(b) Legal compliance. Licensees relying upon the statutory licenses
set forth in 17 U.S.C. 112(e) and 114 shall comply with the
requirements of those sections and the rates and terms of this part.
(c) Relationship to voluntary agreements. Notwithstanding the
royalty rates and terms established in this part, the rates and terms
of any voluntary license agreements entered into by Copyright Owners
and Licensees shall apply in lieu of the rates and terms of this part
to transmissions with the scope of such agreements.
Sec. 383.2 Definitions.
For purposes of this part, the following definitions shall apply:
(a) Bundled Contracts means contracts between the Licensee and a
Provider in which the Service is not the only content licensed by the
Licensee to the Provider.
(b) Collective means the collection and distribution organization
that is designated by the Copyright Royalty Judges, and which, for the
current rate period, is SoundExchange, Inc.
(c) Copyright Owner means a sound recording copyright owner, or a
rights owner under 17 U.S.C. 1401(l)(2), who is entitled to receive
royalty payments made under this part pursuant to the statutory
licenses under 17 U.S.C. 112(e) and 114.
(d) License Period means the period commencing January 1, 2026, and
continuing through December 31, 2030.
(e) Licensee is a person that has obtained statutory licenses under
17 U.S.C. 112(e) and 114, and the implementing regulations in this
part, to make digital audio transmissions as part of a Service (as
defined in this section), and ephemeral recordings for use in
facilitating such transmissions.
(f) Payor means the entity required to make royalty payments to the
Collective or the entity required to distribute royalty fees collected,
depending on context. The Payor is:
(1) A Licensee, in relation to the Collective; and
(2) The Collective in relation to a Copyright Owner or Performer.
(g) Performers means the independent administrators identified in
17 U.S.C. 114(g)(2)(B) and (C) and the parties identified in 17 U.S.C.
114(g)(2)(D).
(h) Provider means a ``multichannel video programming distributor''
as that term is defined in 47 CFR 76.1000(e); notwithstanding such
definition, for purposes of this part, a Provider shall include only a
distributor of programming to televisions, such as a cable or satellite
television provider.
(i) Qualified auditor means a Certified Public Accountant
independent within the meaning of the American Institute of Certified
Public Accountants Code of Professional Conduct.
(j) Service is a non-interactive (consistent with the definition of
``interactive service'' in 17 U.S.C. 114(j)(7)) audio-only subscription
service (including accompanying information and graphics related to the
audio) that is transmitted to residential subscribers of a television
service through a Provider which is marketed as and is in fact
primarily a video service where:
(1) Subscribers do not pay a separate fee for audio channels.
(2) The audio channels are delivered by digital audio transmissions
through a technology that is incapable of tracking the individual sound
recordings received by any particular consumer.
(3) However, paragraph (j)(2) of this section shall not apply to
the Licensee's current contracts with Providers that are in effect as
of the effective date of this part if such Providers become capable in
the future of tracking the individual sound recordings received by any
particular consumer, provided that the audio channels continued to be
delivered to Subscribers by digital audio transmissions and the
Licensee remains incapable of tracking the individual sound recordings
received by any particular consumer.
(k) Subscriber means every residential subscriber to the underlying
service of the Provider who receives Licensee's Service in the United
States for all or any part of a month; provided, however, that for any
Licensee that is not able to track the number of subscribers on a per-
day basis, ``Subscribers'' shall be calculated based on the average of
the number of subscribers on the last day of the preceding month and
the last day of the applicable month, unless the Service is paid by the
Provider based on end-of-month numbers, in which event ``Subscribers''
shall be counted based on end-of-month data.
(l) Stand-Alone Contracts means contracts between the Licensee and
a Provider in which the only content licensed to the Provider is the
Service.
[[Page 11473]]
Sec. 383.3 Royalty fees for public performances of sound recordings
and the making of ephemeral recordings.
(a) Royalty rates. Royalty rates for the public performance of
sound recordings by eligible digital transmissions made over a Service
pursuant to 17 U.S.C. 114, and for ephemeral recordings of sound
recordings made pursuant to 17 U.S.C. 112(e) to facilitate such
transmissions during the License Period, are as follows. For 2026, each
Licensee will pay, with respect to content covered by the License that
is provided via the Service of each such Licensee:
(1) For Stand-Alone Contracts, a monthly payment of [amount to be
calculated in November 2025 and published in December 2025 in the final
rule] per Subscriber to the Service of such Licensee, which is
equivalent to the 2025 royalty rate of $0.0234, as adjusted by the
annual royalty fee adjustment in paragraph (b) of this section.
(2) For Bundled Contracts, a monthly payment of [amount to be
calculated in November 2025 and published in December 2025 in the final
rule] per Subscriber to the Service of such Licensee, which is
equivalent to the 2025 royalty rate of $0.0390, as adjusted by the
annual royalty fee adjustment in paragraph (b) of this section.
(b) Annual royalty fee adjustment. (1) The Copyright Royalty Judges
shall adjust the royalty fees each year, as described in paragraph
(b)(2) of this section, beginning with the fees for 2026, to reflect
any changes occurring in the cost of living as determined by the most
recent Consumer Price Index for All Urban Consumers (U.S. City Average,
all items) (CPI-U) published by the Secretary of Labor before December
1 of the preceding year.
(2)(i) The calculation of the rate for each year shall be
cumulative based on a calculation of the percentage increase in the
CPI-U from the CPI-U published in November 2024 (CPI-U%) and shall be
made according to the following formulas:
(A) For Stand-Alone Contracts, (1 + (C<INF>y</INF>-315.664)/
315.664) x $0.0234; and
(B) For Bundled Contracts, (1 + (C<INF>y</INF>-315.664)/315.664) x
$0.0390; and
(ii) For both formulas C<INF>y</INF> is the CPI-U published by the
Secretary of Labor before December 1 of the preceding year. The
adjusted rate shall be rounded to the nearest fourth decimal place.
(3) The Judges shall publish notice of the adjusted fees in the
Federal Register at least 25 days before January 1 of each year of the
License Period. The adjusted fees shall be effective on January 1 of
each year of the License Period for such year.
(c) Minimum fee. Each Licensee will pay an annual, non-refundable
minimum fee of one hundred thousand dollars ($100,000), payable on
January 31 of each calendar year in which the Service is provided
pursuant to statutory licenses under 17 U.S.C. 112(e) and 114. Such fee
shall be recoupable and credited against royalties due in the calendar
year for which the payment is made.
(d) Allocation between ephemeral recordings fees and performance
royalty fees. The Collective must credit 5% of all royalty payments as
royalty payment for Ephemeral Recordings and credit the remaining 95%
to royalties under 17 U.S.C. 114. All Ephemeral Recordings that a
Licensee makes which are necessary and commercially reasonable for
making noninteractive digital transmissions through a Service are
included in the 5%.
Sec. 383.4 Distribution of royalties.
The Collective must promptly distribute royalties received from
Licensees to Copyright Owners and Performers that are entitled thereto,
or to their designated agents. The Collective shall only be responsible
for making distributions to those who provide the Collective with
information as is necessary to identify and pay the correct recipient.
The Collective must distribute royalties on a basis that values all
usage by a Licensee equally based upon the information provided under
the Reports of Use requirements for Licensees pursuant to Sec. 370.4
of this chapter and this part. However, in any case in which a Licensee
has not provided a compliant Report of Use, whether for the License
Period or otherwise, and the board of directors of the Collective
determines that further efforts to seek the missing Report of Use from
the Licensee would not be warranted, the Collective may distribute the
royalties associated with the Licensee's missing Report of Use on the
basis of Reports of Use for the corresponding calendar year filed by
other Licensees.
Sec. 383.5 Auditing payments and distributions.
(a) General. This section prescribes procedures by which any entity
entitled to receive payment or distribution of royalties may verify
payments or distributions by auditing the Payor. The Collective may
audit a Licensee's payments of royalties to the Collective, and a
Copyright Owner or Performer may audit the Collective's distributions
of royalties to the Copyright Owner or Performer. Nothing in this
section shall preclude a verifying entity and the Payor from agreeing
to verification methods in addition to or different from those set
forth in this section.
(b) Frequency of auditing. The verifying entity may conduct an
audit of each Licensee only once a year for any or all of the prior
three calendar years. A verifying entity may not audit records for any
calendar year more than once.
(c) Notice of intent to audit. The verifying entity must file with
the Copyright Royalty Judges a notice of intent to audit the Payor,
which notice the Judges must publish in the Federal Register within 30
days of the filing of the notice. Simultaneously with the filing of the
notice, the verifying entity must deliver a copy to the Payor.
(d) The audit. The audit must be conducted during regular business
hours by a qualified auditor who is not retained on a contingency fee
basis and is identified in the notice. The auditor shall determine the
accuracy of royalty payments or distributions, including whether an
underpayment or overpayment of royalties was made. An audit of books
and records, including underlying paperwork, performed in the ordinary
course of business according to generally accepted auditing standards
by a qualified auditor, shall serve as an acceptable verification
procedure for all parties with respect to the information that is
within the scope of the audit.
(e) Access to third-party records for audit purposes. The Payor
must use commercially reasonable efforts to obtain or to provide access
to any relevant books and records maintained by third parties for the
purpose of the audit.
(f) Duty of auditor to consult. The auditor must produce a written
report to the verifying entity. Before rendering the report, unless the
auditor has a reasonable basis to suspect fraud on the part of the
Payor, the disclosure of which would, in the reasonable opinion of the
auditor, prejudice any investigation of the suspected fraud, the
auditor must review tentative written findings of the audit with the
appropriate agent or employee of the Payor in order to remedy any
factual errors and clarify any issues relating to the audit; provided
that an appropriate agent or employee of the Payor reasonably
cooperates with the auditor to remedy promptly any factual errors or
clarify any issues raised by the audit. The auditor must include in the
written report information concerning the cooperation or the lack
thereof of the employee or agent.
(g) Audit results; underpayment or overpayment of royalties. If the
auditor
[[Page 11474]]
determines the Payor underpaid royalties, the Payor shall remit the
amount of any underpayment determined by the auditor to the verifying
entity, together with interest at the rate specified in Sec. 380.2(d)
of this chapter. In the absence of mutually agreed payment terms, which
may, but need not, include installment payments, the Payor shall remit
promptly to the verifying entity the entire amount of the underpayment
determined by the auditor. If the auditor determines the Payor overpaid
royalties, however, the verifying entity shall not be required to remit
the amount of any overpayment to the Payor, and the Payor shall not
seek by any means to recoup, offset, or take a credit for the
overpayment, unless the Payor and the verifying entity have agreed
otherwise.
(h) Paying the costs of the audit. The verifying entity must pay
the cost of the verification procedure, unless the auditor determines
that there was a net underpayment (i.e., underpayments less any
overpayments) of 10% or more, in which case the Payor must bear the
reasonable costs of the verification procedure, in addition to paying
or distributing the amount of any underpayment.
(i) Retention of audit report. The verifying party must retain the
report of the audit for a period of not less than three years from the
date of issuance.
Sec. 383.6 Terms for making payment of royalty fees.
(a) Terms in general. Subject to the provisions of this section,
terms governing timing and due dates of royalty payments to the
Collective, late fees, statements of account, audit and verification of
royalty payments and distributions, retention of records requirements,
treatment of Licensees' confidential information, distribution of
royalties by the Collective, unclaimed funds, designation of the
Collective, and any definitions for applicable terms not defined in
this part and not otherwise inapplicable shall be those adopted by the
Copyright Royalty Judges for digital audio transmission and the
reproduction of ephemeral recordings by Commercial Webcasters in part
380, subpart A, of this chapter, for the License Period. For purposes
of this part, the term ``Collective'' refers to the collection and
distribution organization that is designated by the Copyright Royalty
Judges. For the License Period, the sole Collective is SoundExchange,
Inc.
(b) Reporting of performances. Without prejudice to any applicable
notice and recordkeeping provisions, statements of account shall not
require reports of performances.
(c) Applicable regulations. To the extent not inconsistent with
this part, all applicable regulations, including part 370 of this
chapter, shall apply to activities subject to this part.
Dated: February 25, 2026.
Trevor Jefferson,
Interim Chief Copyright Royalty Judge.
David R. Strickler,
Copyright Royalty Judge.
Steve Ruwe,
Copyright Royalty Judge.
Approved by:
Robert R. Newlen,
Acting Librarian of Congress.
[FR Doc. 2026-04627 Filed 3-9-26; 8:45 am]
BILLING CODE 1410-72-P
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