News June 16, 2021

Sony Music Entertainment to pay royalties to legacy artists in landmark move

Sony Music Entertainment to pay royalties to legacy artists in landmark move

In an historic industry move, Sony Music Entertainment has announced that it will begin paying out the royalties of heritage artists who signed with the company prior to 2000 and have yet to recoup their record advances.

Dubbed the Legacy Unrecouped Balance Program, the plan acts as a continuation of Sony’s Artists Forward initiative to improve industry practice and transparency among creatives, with Sony detailing the move in a letter to thousands of artists over the weekend.

Throughout the 20th century, many record contracts were written in a manner that nullified the chance of artists earning catalogue royalties in the occurrence that they failed to recoup their initial recording advance payments.

Moving forward, however, Sony will effectively disregard unrecouped balances for qualifying artists, songwriters and producers who signed with the company prior to 2000 and are yet to recoup their advances.

As part of the policy, legacy acts will now begin to earn royalty payments on a regular basis, including payments backdated to January 1, 2021.

Qualifying artists, producers and songwriters will be informed of their eligibility in the scheme within coming weeks.

In a letter explaining the initiative, Sony Music Entertainment noted that the Legacy Unrecouped Balance Program would not result in the modification of contracts, but would pay through existing unpaid balances to “increase the ability of those who qualify to receive more money from uses of their music”.

“As part of our continuing focus on developing new financial opportunities for creators, we will no longer apply existing unrecouped balances to artist and participant earnings generated on or after January 1, 2021 for eligible artists and participants globally who signed to SME prior to the year 2000 and have not received an advance from the year 2000 forward,” the letter reads.

“Through this program, we are not modifying existing contracts, but choosing to pay through on existing unrecouped balances to increase the ability of those who qualify to receive more money from uses of their music.”

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