Spotify to leave Uruguay after changes to the country’s Copyright Law

Spotify to leave Uruguay after changes to the country’s Copyright Law

In a recent statement, Spotify, one of the world’s largest audio platforms, announced through a spokesperson that it will stop offering its services to users in Uruguay by February 2024. The decision, according to the company, was due to the updating of Uruguay’s Copyright Law (Law 9.739/37 amended by Law 17616/2003), approved in November.

Articles 329 and 303 of the Bill Revenues Law, Law 20212, approved on November 6, 2023, amend articles 36 and 39 of the Uruguayan LDA, which now provide for the payment of related rights for performances and interpretations shown and transmitted on social networks and the internet, as well as determining that performers and musicians receive percentages in an equitable manner, which do not differ fundamentally from those obtained by record companies, publishers and authors.

In the statement, Spotify expressed concerns that the approved changes could result in double payments for the same song, making its business model unsustainable. “Spotify already pays almost 70% of every dollar it generates from music to the labels and publishers who own the rights to the music and represent and pay artists and songwriters. Any additional payments would make our business unsustainable,” says the announcement.

Thus, the decision to leave the company will have an impact on the music sector in Uruguay, which in 2022 represented the 53rd largest recorded music market in the world, with revenues of US$13.2 million (an increase of 20.2% on the previous year), with streaming accounting for 64.4% of these revenues, according to research by the International Federation of the Phonographic Industry (IFPI).

In Brazil, there is a Bill of Law (PL) currently before the Chamber of Deputies (substitute text for PL 2370/2019) which deals with the remuneration of holders of copyright and related rights for the use of musical works on the internet by providers (a term which includes social networks and on-demand providers), art. 88b of the PL. According to these dispositive, right holders will be entitled to the remuneration to be paid by the provider, even if the use was initiated by third parties within the scope of the services offered by the provider, regardless of the existence of an instrument transferring rights to third parties for the production and economic use of the musical work, phonogram, interpretation, or performance.

The Bill of Rights Act amending articles 36 and 39 of the Uruguayan LDA can be accessed via the following link: : https://medios.presidencia.gub.uy/legal/2023/leyes/11/cons_min_806.pdf

Substitute text n. 2 of Bill 2370/2029 can be accessed at: https://www.camara.leg.br/proposicoesWeb/prop_mostrarintegra?codteor=2311416&filename=PRLP+2+%3D%3E+PL+2370/2019

Spotify’s press release can be accessed via this link: https://pr-newsroom-wp.appspot.com/2023-12-01/spotify-esta-siendo-forzado-a-salir-de-uruguay/

Note: For quick release and cost control, this English version is provided by automated translation without human review.