If you are a songwriter with commercial work that’s been publicly released, you may eventually receive a Notice of Intent (NOI) letter stating that a third party wants to record or distribute your composition. This is because the Copyright Act of 1976 requires a compulsory mechanical license from a rightsholder in order to distribute their recording, and sending an NOI letter is all that’s needed to obtain it.
The only stipulation is that the original songwriter must be properly compensated. By agreeing to pay Congress’ statutory royalty rate — currently 9.1 cents per song for physical or download copies — a composition can be re-recorded or distributed without the writer’s or publisher’s approval.
The Mechanical Rights Copyright Loophole
It’s important to note that the U.S. Copyright Office asks artists and distributors to make good faith efforts to locate and pay songwriters mechanical rights for any cover works they distribute. It does not require them to take extraordinary measures to find the writer beyond sending an NOI to whomever it believes owns the mechanical rights.
Problems arise when a potential distributor searches for a rightsholder in the Copyright Office’s files, where not every songwriter is registered. Searching the records of a digital service, the service’s licensing agent, or a Performing Rights Organization (PRO) is far more effective, but some distributors don’t take the time because a loophole in the statute does not require them to actually find the rightsholder.
If they can’t be located, a notice is filed with the Copyright Office. To date, more than 1 million “address unknown” forms have followed this procedure, releasing licensors from the obligation to pay mechanical royalties.
Locating Mechanical Rights
You may already know that every song has two types of copyright. There is the copyright on the “master,” or sound recording (captured on tape or a hard drive), and the copyright on the “composition,” or the underlying music and lyrics. A compulsory license only seeks the mechanical rights to a composition; it does not grant any other rights, including syncs (using music along with video).
Streaming services like Spotify and Apple Music need to license both master and composition copyrights to offer a song for sale or download, and an additional sync license is required in order to use a song/recording in a video uploaded to YouTube or elsewhere.
While your PRO (e.g., ASCAP, BMI or SESAC) deals with performance rights, mechanical rights are handled by Mechanical Rights Organizations (MROs) like The Mechanical Licensing Collective (The MLC). The newly formed nonprofit was created as part of the Music Modernization Act (MMA) to administer blanket mechanical licenses to eligible streaming services and pay the resulting royalties to songwriters, composers, lyricists, and publishers.
Whenever a song you write is recorded and sold in either a physical or digital format, you are entitled to a mechanical royalty. Working with a publishing administrator like Songtrust is the smartest way to cope with issues related to your mechanical rights. Songtrust will register your songs with The MLC and other international MROs. Once that’s taken care of, we will obtain all the proper mechanical licenses for cover versions of your songs, so you can focus on what you do best: writing and recording music.
Please note: This article is based on U.S. law and does not address international regulations. Feel free to contact us if you have any questions, or head straight to our signup page to make Songtrust your publishing administrator today.