On 22 March 2017, the Italian Competition Authority ("ICA") accepted commitments from the copyright-collecting society NUOVOIMAIE ("NI") aimed at addressing ICA's concerns that NI had abused its dominant position on the Italian market for management and intermediation services in the audio-visual and musical sector, in violation of Article 102 TFEU and Article 3 of Law 10 October 1990, n. 287.
NI is a collecting society whose function is to collect the royalties accrued through the use of works of art (music, films, audio-visual material) and to redistribute the earnings to right holders (artists, interpreters and performers). NI is the successor of IMAIE, which had been the only collecting society in Italy, until it went bankrupt in 2009. In its capacity as successor, NI inherited IMAIE's general database which contained right holders' works and contact details. NI also assumed IMAIE's obligation to pay right holders their royalties, until market liberalisation occurred in 2012.
In April 2016, the ICA initiated an investigation after it received a complaint from two other market operators alleging that NI was abusing its dominant position in three ways. In particular, it was claimed that:
1. NI exploited its obligation to pay royalties on behalf of IMAIE, by using it as an opportunity to approach right holders and ask them to join the society. It also reportedly told some right holders that payment of outstanding royalties owed by IMAIE was conditional on becoming a member of NI;
2. NI refused to give competitors access to the general database, which was considered essential in order to identify and contact right holders; and
3. NI used its position as IMAIE's successor to sign agreements with foreign collecting societies in 2012, and also with important national broadcasters. The contracts were long-term and automatically renewed, thus excluding the new market entrants from the possibility of representing foreign artists and making it more difficult for them to represent their Italian members abroad.
Following the investigation, NI presented a number of commitments which the ICA deemed sufficient to re-establish a level playing field on the Italian market.
Specifically, NI committed to no longer request exclusive sponsorship and partnership agreements from right holders. It also agreed to give competitors free access to content uploaded to the general database before mid-March 2014 and full access in exchange for a license fee.
To address NI's long-term agreements with foreign collecting societies, NI agreed to recognise a party's right to terminate existing contracts on 30 days' notice. In addition, NI's future contacts will be limited in duration to one year and will not contain automatic renewal clauses.
Concerning its relations with TV broadcasters, NI agreed to the creation of a special commission and round table devoted to answering questions regarding the sums owed to right holders who are not affiliated with any collecting society. NI also committed to offer Italy's public national broadcaster a licensing contract to access the database on fair, reasonable and non-discriminatory ("FRAND") conditions.
Interestingly, the ICA recently opened another abuse of dominance investigation concerning the activities of the copyright-collecting society, SIAE, for alleged conduct similar to NI's.
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