SOCAN Tariff for Commercial TV Stations

Summary#

This item publishes SOCAN Tariff 2.A – Commercial Television Stations (2014-2024), the schedule of music royalties that the Society of Composers, Authors and Music Publishers of Canada (SOCAN) can collect from commercial TV broadcasters in Canada for music used in their broadcasts. It sets a simple option that costs 1.9% of a station’s gross income and a more detailed “modified” option with several percentage components and extra reporting and record-keeping requirements.

What it does#

• Applies to broadcast television stations in Canada for the years 2014–2024.
• Excludes stations owned and operated by the Canadian Broadcasting Corporation and stations covered under other tariffs.
• Gives each station two licence choices:
  • Standard blanket licence: pay 1.9% of the station’s gross income (based on income from two months earlier) and report and pay by the day before the month the tariff applies.
  • Modified blanket licence (MBL): use a multi-part formula (see bullets below) and follow extra reporting rules and deadlines.
    • Components used in the MBL calculation include: 3% × 1.9%, 1% × 1.9%, 5% × 1.9%, and 22% × 95% × 1.9% applied to either “all programs” or “cleared programs” as specified in the tariff.
    • Stations using the MBL must submit Form A (calculation) and Form B (a music-by-music report for every program they call “cleared”) and provide proof of clearances when requested.
    • Amounts paid on account for cleared programs (parts of the formula) are not refundable if a program was incorrectly claimed as cleared.
• Election and timing rules:
  • A station must file an election in writing 30 days before the first day of the month the election takes effect.
  • A station can make at most two elections in a calendar year.
  • If a station never elected, it is treated as having chosen the standard blanket licence.
• Record-keeping and audits:
  • Stations must keep records for six years.
  • SOCAN may audit those records during that period.
  • If an audit finds royalties were understated by more than 10%, the station may have to pay the audit costs (except for errors caused by SOCAN).
• Late payments and interest:
  • Interest is charged daily at a rate equal to 1% above the Bank Rate (as published by the Bank of Canada) until payment is received; interest does not compound.

Who's affected#

• Primarily commercial broadcast television stations in Canada that are not owned by the Canadian Broadcasting Corporation and not covered by another tariff.
• Station owners and operators will face direct costs and reporting duties under either licence option.
• Producers and program suppliers could be indirectly affected because stations must track and document music clearances for “cleared programs.”
• It is not clear from the notice whether very small or community stations are specifically treated differently beyond the general exclusions.

Why it matters#

• This sets how much commercial TV stations must pay SOCAN for using music in broadcasts over a ten-year span (2014–2024), so it affects station budgets and accounting for music use.
• The two licence choices change cash flow and paperwork: the standard licence is simpler; the modified licence can lower some charges but requires detailed reporting and carries the risk of non-refundable charges if stations misclassify programs.
• The audit and record-keeping rules mean stations need reliable tracking of music rights for up to six years, or they risk extra costs, interest, and paying audit fees if significant under-reporting is found.