SGAE Fined €6.5 Million in Spain for Anticompetitive Licensing Practices

The Spanish General Society of Authors and Editors (SGAE) has been fined €6.5 million by Spain’s competition regulator, CNMC, over its anticompetitive licensing approach for radio and TV broadcasters. This penalty comes as a result of SGAE’s flat rate licensing system, which CNMC has ruled breaches competition law.

SGAE’s licensing model requires most broadcasters to accept a flat rate license, irrespective of the actual use of its music repertoire. According to CNMC, this system is unfair as it does not account for the number of works used or the intensity of their usage. The flat rate setup means that broadcasters’ payments to SGAE remain unchanged even if they use less of its music, which complicates negotiations for smaller rival societies.

This ruling is especially significant given the presence of a second song rights collecting society in Spain, Unison. Established in 2017, Unison aims to introduce more competition into the collective licensing market, a goal aligned with recent European legal reforms. Unison’s emergence coincided with a period of controversy for SGAE, which faced criticism over its governance and distribution of broadcast royalties.

Previously, SGAE was fined for making it difficult for members to switch to Unison. The current fine highlights ongoing issues with SGAE’s practices that hinder competition and create challenges for new entrants in the market.

Source: Complete Music Update