Corporate Annual Galas and Copyright Law: Judicial Definition of Free Performances vs. Commercial Promotion
As the Spring Festival approaches, enterprises and educational institutions are busy preparing for annual galas, evening parties and other events to reflect on the past year and look ahead to the new one. It is important to note, however, that staging artistic performances at such events using others' works without permission may expose the organizers to the risk of copyright infringement.
Recently, the Hefei High-Tech Industrial Development Zone People's Court in Anhui Province concluded a relevant case. An enterprise invited singers to perform songs created by others live at its annual gala and broadcast the event live online. Having failed to obtain the copyright holders' permission and pay remuneration, the enterprise was sued by the right holders. The court ultimately found the enterprise and the performers jointly liable for infringement and ordered them to compensate for economic losses of 40,000 yuan. The judgment has now entered into force.
Copyright disputes arising from the performance of others' songs are not uncommon at various events, from corporate annual galas to university freshmen welcome parties and graduation ceremonies. So, when singing others' songs at such artistic performances, which circumstances qualify as "fair use"? In which cases is authorization a must? And what copyright issues should be noted?
Fair Use Is Subject to Conditions
Unlike regular commercial performances, singing songs at internal events of enterprises or educational institutions is often regarded as "fair use". But in such cases, what rights are involved in performing without permission? Under what circumstances does it constitute infringement? And who shall bear the liability?
A professor at China University of Political Science and Law pointed out that live song performances mainly involve the copyright holders' right of performance. This right is exclusive to copyright holders, and no one else may publicly perform their works without permission. The Copyright Law of the People's Republic of China also stipulates that a "free performance"—namely, one for which no fees are charged to the audience, no remuneration is paid to the performers, and which is not conducted for profit purposes—may be held without the copyright holder's permission and without paying remuneration, provided that the author's name and the work's title are appropriately indicated. Performances that fail to meet the above conditions constitute an infringement of the right of performance, and both the event organizers and performers shall bear corresponding liabilities.
A "free performance" must simultaneously satisfy two conditions: no fees charged to the audience and no remuneration paid to the performers. If professional singers are invited and paid, the performance is no longer a "free performance" and may constitute an infringement.
In addition, fair use for "free performances" is limited to on-site dissemination. If the event is also broadcast live online, it falls under the scope of the right of broadcasting. Unauthorized live broadcasting will infringe upon the copyright holder's right of broadcasting.
Beyond the right of performance, live online broadcasting of a performance or the dissemination of a recorded performance may also involve the right of broadcasting or the right of information network dissemination. The use of an official original accompaniment will additionally involve the right to remuneration of sound recording producers.
Infringement is generally established when two elements are met: "without permission" and "public performance or dissemination". The liable parties usually include the event organizer and the performers, who may be found jointly liable for infringement.
Uploading videos of annual galas or evening parties to online platforms for dissemination may infringe upon the right of information network dissemination of the songwriters, composers and sound recording producers. Both the uploaders and the online platforms that fail to take necessary measures in a timely manner after receiving a notification may bear corresponding legal liabilities.
A Broad Interpretation of "For Profit Purposes"
In the aforementioned case, the court pointed out that although no tickets were sold for the corporate annual gala, the live broadcast on multiple media platforms attracted over 4 million views, which objectively served to promote the enterprise. Therefore, the performance did not qualify as fair use. The court made the above judgment by comprehensively considering factors such as the performers' popularity, the works' influence and the scale of the performance.
So how to determine whether a live broadcast "objectively serves commercial promotion purposes"?
In judicial practice, the court will generally consider a combination of factors, including whether the use conforms to the statutory circumstances of fair use, whether the live broadcast has commercial attributes, whether it enhances the organizer's popularity or brings potential commercial benefits, and the scope of dissemination and social impact. If a live broadcast obviously generates promotional effects or commercial opportunities, it is likely to be deemed as having commercial promotion purposes, and thus fair use will not apply.
The court stated that a "free performance" requires that it is "not conducted for profit purposes", and "for profit purposes" should be interpreted broadly. Even without direct profits, a performance that significantly enhances an enterprise's image and expands its public influence shall be deemed an act with potential commercial benefits.
For example, in the above case, the large-scale live broadcast obviously brought brand exposure to the enterprise, and thus it should be found to have profit-making purposes.
The current Copyright Law adds a principle to fair use: "the use shall not affect the normal exploitation of the work nor unreasonably prejudice the legitimate rights and interests of the copyright holder". Widespread public dissemination of an internal performance can hardly comply with this principle.
Therefore, once the use of a work exceeds the scope of fair use, the organizer must obtain authorization in accordance with the law.
This copyright dispute arising from an annual gala performance sounds another warning bell for us. Copyright is not a trivial matter; preventing infringement risks and respecting the creative achievements of others should be a compulsory course in the preparation of every event. We should start with ourselves and the small details, and work together to create a sound environment that respects copyright.
