Eight months after the Copyright (Amendment) Act, 2012 sailed through Parliament, I’m told that at least some composers & lyricists are involved in intense negotiations with producers, with both sides trying to interpret to their advantage the new amendments inserted into the Copyright Act. The most contentious provisions are the provisos in Section 18 and Section 19 which mandatorily requires that all royalties earned from exploitation of the music and lyrics as a part of a cinematograph film be shared equally with the composer and lyricist.
Leaving aside these contentious negotiations, I am quite sure that there are a bunch of authors and composers who are more worried about just receiving a one-time down payment, even at the cost of surrendering their right to mandatory royalty sharing provision. Only problem being, that they cannot surrender these rights under the amendments since the provisions have been designed to protect composers and lyricists from themselves and no producer is going to give them down payments without a clear undisputed title to the entire work. So technically although a composer or author can sign a contract surrendering these rights to the producer, he or she can always challenge the contract later and ask a court to declare it void under the 2012 amendments, thereby entitling him or her to a share of royalties earned by the producer.
But is there a way to avoid this entire scenario especially the mandatory royalty sharing provisions of the Copyright (Amendment) Act, 2012?
What if all the parties to the contract were to choose to enter into the contract under a foreign law such as Singapore copyright law or who knows, Sri Lankan copyright law - somewhere close to India? The applicable law to the contract would be Singapore copyright law and not Indian copyright law. There is nothing in Indian law which forbids Indians living in India from entering into such contracts under foreign law at the cost of excluding Indian copyright law. Once Indian copyright law is excluded, I’m guessing that the mandatory royalty sharing provisions under Indian copyright law will no longer be applicable.
A foreign work can be enforced in India by virtue of Section 40 of the Copyright Act, 1957 which mandates reciprocity for foreign copyrights as a requirement of fulfilling India’s treaty obligations.
Will an Indian court apply the mandatory royalty sharing provisions to even foreign contracts and foreign works? I’m not sure about that but I don’t think that the principles of the Berne Convention and TRIPs would allow India to fundamentally alter foreign contracts entered into under foreign copyright law by forcing the mandatory royalty sharing provisions onto unsuspecting foreign copyright owners.
The only possible problem with such an approach could be potential taxation issues but I have no clue about taxation law, so I’ll stay silent on this aspect. What do our readers think? Will such an approach work or am I completely off the mark?