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Industry Report: Produce - Co-Produce...

Contracts in cinema I: Copyright and the chain of title


- The article gives a definition of intellectual property and provides information on how to finance, produce, sell or show a film.

Contracts in cinema I: Copyright and the chain of title

Whom should I pay for the music of a film? Is an actor an author? If a work has already been broadcasted, can the author prevent others from fixing it? When is a work in the public domain? These are some of the questions that producers, financiers, public support institutions, distributors, world sales companies or exhibitors may ask themselves when conceiving, financing, producing, selling or showing a film.

Copyright and related rights
According to the WIPO (World International Property Organization), intellectual property can be defined in a broad way as “the legal rights which result from intellectual activity in the industrial, scientific, literary and artistic fields”, which includes copyright, patents or trademarks.

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Article 2 of the Berne Convention for the Protection of Literary and Artistic Works lists the kind of works to be protected. It includes the rights of authors of cinematographic works, books and other writings, choreographic works, musical compositions, works of drawing, painting, architecture and sculpture, photographic works, dramatic works, etcetera. It also provides that “translations, adaptations, arrangements of music and other alterations of a literary or artistic work shall be protected as original works”. One or more of these sorts of work are usually involved in the production of a film.

The rights granted to these works’ authors are known as copyrights in common law countries and authors’ rights in civil law countries, and are both moral and economic. The moral rights include the right to claim authorship of the work and the right to object to any distortion, mutilation or other modification of the work. The exclusive economic rights include copying or reproducing the work, performing the work in public, making a sound recording or a motion picture, broadcasting the work and translating or adapting it.

But not only the authors have rights; the International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations (Rome Convention) and the WIPO Performances and Phonograms Treaty (WPPT) confer rights to the performing artists in their performances, to the producers of phonograms in their phonograms, and the broadcasting organizations in their radio and television programs; the so called related or neighboring rights. Especially important for the cinema production is the case of performers (actors, musicians, singers …), that have right to paternity and to prevent others from fixing their performances, as well as from broadcasting or communicating to the public not previously broadcasted or fixed performances.

Each of the several rights generated by an artistic work can be transferred independently. The rights holder can license one, several or all the owned rights for one or more purposes. He can also make a territorial division of their rights and limit them in the time, as well as license them exclusively or not.

The chain of title
Many copyrights are involved in the exploitation of audiovisual works throughout its value chain. The chain of title is the sequence of rights’ transfers from the present time to the first generation of the rights.

The chain of title documents shall include all the agreements dealing with the copyrights of the film. They must be checked and will be checked as many times as a purchase of the film’s rights takes place, since they certify the producer has acquired all the rights involved in the film and therefore is allowed to grant them to third parties (distributor, TV channel, world sales company …) to exploit the film. These documents should be registered in a notary’s office or an official registry office.

The chain of rights’ list of documents shall include:
- Option Agreement for the adaptation of the literary rights;
- Agreement with the actors (including rights to their work, image, likeness, and personality), directors, choreographers, musicians and scriptwriter working for the film;
- Rights clearance of music (copyright, recording rights and performance rights), archive materials, existing films’ footage, TV clips, pictures, buildings, actor’s performance rights used in the film;
- Errors and Omissions Insurance.

Assignment, license and clearance of rights
An assignment is a sell of the copyright where the assignee becomes the owner of the rights, without reversibility of the assigned rights to the assignor. Nevertheless it is not allowed in all countries. A typical example of this would be the screenwriter’s rights in a film, commonly assigned to the film production company.
A license is a leasing of rights, where the licensor remains owner of his rights, but authorizes the licensee to exercise some of his rights within agreed conditions for a concrete purpose. De facto, a license of rights in perpetuity produces a similar effect as an assignment.

An agreement on the adaptation of a literary work is a good example of licensing: the rights’ holder of a novel licenses the exclusive right to a film producer to adapt it into a script in order to produce a determined audiovisual work. The producer will also have to purchase the so called underlying rights to communicate to the public, to broadcast or to copy the resulting work, since the author of the pre-existing work will become co-author of the film.

A clearance is a sort of non exclusive rights’ license of a work. It is desirable to obtain it when pre-existing artistic works, such as pictures or sculptures, appear by chance in a film. Even if it can be argued that its use was incidental and, therefore does not infringe the copyrights, it is always better to ask the rights’ holder for a clearance so as to avoid problems in the future.

Duration of copyright. Public domain
While moral rights never expire, the protection of economic rights is limited in time. The international agreements on this purpose establish that copyright national laws must protect copyright for a period of at least 50 years following the death of the author; nevertheless European legislation extend the duration to 70 years.

In the case of related rights, the broadcasters shall be protected for a minimum period of 20 years since the first broadcast. The performers are also protected for a period of 20 years; 50 years in the case of performers of works fixed in phonograms other than in the form of a fixation incorporated in cinematographic works.

When the copyright protection period expires, the work enters the public domain and everybody can use it without having to ask for the rights or pay for them. A film producer must take into account that not all the rights surrounding a work enter the public domain at the same time. For instance, if he wants to include a Beethoven’s work in the soundtrack of a film, he does not have to pay for the copyright, but he may have to pay to the performers and the producer of the phonograph he intends to use; otherwise he will have to hire performers and record the music for the film.

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