The U.S. Copyright Office has launched a formal inquiry into performing rights organizations (PROs) following concerns raised by Congress members about transparency and licensing practices.

The inquiry, announced in response to a letter from Representatives Scott Fitzgerald, Jim Jordan, and Darrell Issa, focuses on two key areas:

1. PRO Proliferation Concerns:

• Growing number of PROs beyond ASCAP and BMI, including GMR, SESAC, and AllTrack
• Increased financial burden on small businesses, particularly bars and restaurants
• Higher risk of infringement allegations from multiple sources

2. Royalty Distribution Transparency:

• Questions about accuracy in compensating independent artists and smaller publishers
• Need for improved royalty calculation methods
• Concerns about fair distribution compared to major artists and publishers

The inquiry timeline includes:

• Initial public comments due by April 11th
• Follow-up responses deadline: May 27th

The MIC Coalition, representing the National Restaurant Association and National Association of Broadcasters, has endorsed the inquiry, calling for increased transparency and competition in the music licensing marketplace.

Current challenges include:

• Complex licensing system affecting businesses of all sizes
• Limited accuracy in tracking non-digital public performances
• Fragmented marketplace requiring multiple PRO licenses
• Need for more efficient royalty tracking systems

The inquiry aims to address these issues while seeking solutions for a more transparent and efficient music licensing system that benefits both businesses and rights holders.

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