In historic move, Sony Music is disregarding unrecouped balances for heritage catalog artists

In historic move, Sony Music is disregarding unrecouped balances for heritage catalog artists

In historic move, Sony Music is disregarding unrecouped balances for heritage catalog artists Photo

For some time, influential voices in the industry have called for the unrecouped balances of heritage artists to be written off by record labels. This would see modern-day royalty earnings of these acts get paid into their pockets, rather than being swallowed by a record label with whom they may have ended dealings decades ago.

That is especially true, in many cases, for heritage Black artists. Last summer, during industry-wide discussions surrounding Blackout Tuesday, veteran US artist manager and attorney, Ron Sweeney, called on the major record companies to implement a number of new policies in a strong op/ed for MBW. Sweeney wrote: “With respect to Black artists signed to you prior to 2000, that are no longer signed to your companies, zero out their unrecouped royalty balances and let their royalties flow to them so they can support themselves.”

In a letter sent to thousands of artists today and obtained by MBW, Sony Music Entertainment (SME) has announced the launch of a new initiative called “Artists Forward”, which it says focuses on “prioritizing transparency with creators in all aspects of their development”.

SME’s landmark new policy under “Artists Forward” is called the Legacy Unrecouped Balance Program. The letter confirms: “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.

“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.”

“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.”

The main reason the balances will technically remain on Sony’s ledger, we understand, is if an artist has reversion rights tied to recoupment. In order to track when reversion will occur in these cases, SME will monitor when the qualifying artist would have recouped if the firm had not been flowing through royalties.

But the bottom line here: If an artist who last received an advance from Sony Music prior to 2000 is unrecouped today, they’re now going to start seeing streaming and other royalty earnings landing in their bank account on the regular… including money backdated to January 1 this year.

Sony’s letter outlining the Legacy Unrecouped Balance Program confirms the new policy will apply to both “artists and participants” who meet the eligibility criteria. MBW has confirmed that “participants” in this case will also include producers, JV partners, and distributed labels who have inked direct deals with SME in the past.

Sony says that artists and participants who qualify for the Legacy Unrecouped Balance Program will be notified of their eligibility individually in the weeks ahead.

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