THE REGULATIONS ON THE DISTRIBUTION OF REMUNERATION
LaIPA Distribution Rules Description Document

• GENERAL PART

1. The remuneration that LaIPA receives for the use of phonograms within the specific fiscal year shall be counted separately for each type of use separately.

2. After the deduction of actual administration costs in accordance with Article 24 (20 of the Collective Management Law), 50% of the remuneration are channelled for distribution to the performers and 50% - to the producers of phonograms.

3. The net income, due to each group of the subjects of rights, is distributed in accordance with the Special Part of these Regulations on the distribution of remuneration to the performers and the phonogram producers.

4. LaIPA pays the remuneration due to the performers and the phonogram producers in accordance with the Special Part of these Regulations, from the net income to the individual subject of rights, if the remuneration exceeds the minimum sum, the amount of which is EUR 10,00.

5. LaIPA pays remuneration in the national currency of Latvia.

6. The time when the remuneration is paid is approved by the Board of the Association, however, it may not take place later than in the year following the collection of remuneration.

7. The remuneration is distributed and paid to the subjects of rights, on the basis of information obtained from the users on the used phonograms. In case it is impossible to obtain accurate information on the phonograms used, the Board of LaIPA takes a decision on the principles of distributing the collected remuneration.

8. LaIPA will make positive and negative adjustments to recordings and right holders allocations in its distribution adjustments. It is therefore possible for a right holder to receive positive and negative adjustments to their earnings because of changes to data.

9. According to Collective Management Law article 23 revenues will be adjusted for a prescription period of 3 years from the end of the first year in which the revenues were distributed. Any monies remaining undistributed after this period will be recycled in the next distribution.

• SPECIAL PART

I. THE DISTRIBUTION OF REMUNERATION TO THE PERFORMERS

1. To ensure cultural and educational activities not more than 10% are deducted from the performers non-distributable amounts after 3 years prescription period. The amount of the sum to be deducted is approved by the Board of LaIPA every year.

2. LaIPA distributed the sum of remuneration, from which all deductions are made, among those performers with regard to whom remuneration has been collected.

3. Every performer has the obligation to submit information on the phonograms it participates in, in accordance with the phonogram registration form developed by LaIPA.

4. The remuneration is paid only if the performer has concluded an agreement of representation with LaIPA and has submitted the information referred to in paragraph 3.

5. If LaIPA demands it, the performer has the obligation to prove in any way that he has participated in the phonogram. LaIPA has the rights to stay the payment of remuneration to this performer till the moment he has proved his participation in the phonogram.

6. If a dispute arises between two or more performers concerning the participation in the phonogram, the dispute is settled by the performers themselves who inform LaIPA by submitting a form, developed by LaIPA, signed by all partied involved in the dispute. LaIPA has the right to stay the payment of remuneration with regard to these performers until the moment the requested form has been submitted.

7. To make the distribution of remuneration to all performers as fair as possible, the following principles shall apply:
7.1. the actual use, based upon the length of playing the phonogram in each specific type of use;

7.2. a system of points, on the basis of which a performer is granted one or more points.

8. The distribution of the remuneration is done as follows:

8.1. the total sum to be distributed is divided by the length of the actual use in minutes in each specific type of use;
8.2. the obtained minutes sum is multiplied by the number of playing each specific phonogram. Thus a sum is obtained, which is to be distributed among the performers for each phonogram title.
 
9. If it is impossible to determine the actual use of the phonogram or the real time of playing in minutes, the Board of LaIPA has the right to decide upon a formula of distribution, on the basis of information available to LaIPA on the use of the phonogram.

10. The remuneration to the performers within the framework of one specific phonogram is distributed as follows:

10.1. participant of the group/ soloist/ conductor - 6 points
10.2. invited/ studio/ orchestra/choir/ and other performers - 1 point

11. The sum of remuneration due to the performers, to whom in accordance with these Regulations 1 point is due, cannot exceed 50% of the total sum of remuneration to be distributed.

12. The number of points of a performer, who has participated in the phonogram as an invited or studio performer and has played or sung several parts in the specific phonogram, are multiplied with the number of parts sung or played.

13. If the remuneration due to a specific performer does not exceed the minimum sum of remuneration, LaIPA shall not pay the remuneration, but shall keep it till the moment when the minimum amount of remuneration is reached, informing the performer thereof.

14. With regard to specific cases concerning the distribution of remuneration not mentioned in these Regulations, the decision shall be taken by the Board of LaIPA.

II. THE DISTRIBUTION OF REMUNERATION TO THE PHONOGRAM PRODUCERS

1. To ensure cultural and educational activities not more than 10% are deducted from the phonogram producer’s non-distributable amounts after 3 years prescription period. The amount of the sum to be deducted is approved by the Board of LaIPA every year.

2. LaIPA distributes the sum of remuneration, from which all deductions are made, among those phonogram producers with regard to whom remuneration has been collected.

3. Every phonogram producer has the obligation to submit information on the phonograms that he has produced and published with commercial purposes, in accordance with the phonogram registration form developed by LaIPA.

4. The remuneration is paid only if the phonogram producer has concluded an agreement of representation with LaIPA and has submitted the information referred to in paragraph 3.

5. If LaIPA demands so, the phonogram producer has the obligation to prove in any way that he has produced the phonogram. LaIPA has the rights to stay the payment of remuneration to this phonogram producer until the moment he has proved the fact of production.

6. If a dispute arises between two or more phonogram producers concerning the production of the phonogram, the dispute shall be settled by the phonogram producers themselves who inform LaIPA by submitting a form, developed by LaIPA, signed by all partied involved in the dispute. LaIPA has the right to stay the payment of remuneration with regard to these phonogram producers until the moment the requested form has been submitted.

7. The remuneration is paid to the phonogram producer for each type of use separately, proportionally to the actual use, on the basis of the length of playing the phonogram in each specific type of use.

8. The distribution of the remuneration is performed as follows:

8.1. the total sum for distribution is divided by the actual length of use in minutes in each specific type of use;
8.2. the obtained minutes sum is multiplied with the number of minutes the specific phonogram has been played. Thus, a sum is obtained to be distributed among the phonogram producers for each phonogram title.

9. If it is impossible to determine the actual use of the phonogram of the real time of playing in minutes, the Board of LaIPA has the right to decide upon a formula of distribution, based on information available to LaIPA on the use of the phonogram.

10. If several phonogram producers have produced the phonogram as co-producers, then the remuneration for each phonogram shall be paid proportionally to each phonogram producer. The remuneration shall be divided into equal parts, unless the phonogram producers have informed LaIPA about a different division among themselves.

11. If the remuneration due to a specific phonogram producer does not exceed the minimum sum of remuneration, LaIPA shall not pay the remuneration, but shall keep it till the moment when the minimum amount of remuneration is reached, informing the phonogram producer thereof.

12. With regard to specific cases concerning the distribution of remuneration not mentioned in these Regulations, a decision will be taken by the Board of LaIPA.