The Day the NRA Took on Copyright

No, not THAT NRA! I’m talking about the National Restaurant Association. Back in the mid-90s they pushed for a carve-out from having to pay songwriters for the music played in bars and restaurants. They got what they wanted and it has hurt American copyright diplomacy ever since.

The issue is about as basic as you can get: bars, restaurants, and other retail establishments play music to enhance the mood (and sales) but they don’t like paying for it. The law already had an exception for very small businesses that used only “homestyle” stereo equipment and the NRA and others came to Washington looking to expand that exception. They didn’t have the votes to pass their bill, but they had the support of one key Congressman who held up other copyright legislation until he got his bill. So, the deal was cut and both bills became law.^[1]

Every year, songwriters lose income because of this law, but that’s just the beginning. Shortly after the law passed, the country of Ireland brought a complaint against the United States in the World Trade Organization. They claimed the United States had violated its obligations on copyright by enacting an exception that was too broad and that Irish songwriters were losing money when their songs were played in Irish pubs in the U.S. When the law was still pending before Congress, then-Register of Copyrights Marybeth Peters had warned this could happen. She was right and Ireland won its case.

The amount of money at issue was small. The WTO found that it was only about a million dollars a year, although that was twenty-five years ago. Still, in the context of the multi-billion dollar entertainment sector, this is small potatoes.

The U.S. had a choice – either change its law or pay Ireland compensation. The Congressman who supported the law was still in office and didn’t care about the WTO, so there was no changing the law. The United States actually paid Ireland for three years before Congress decided to cut that off.

Today, the Congressman has long-since retired but the law still stands. There’s a bit of inertia to these things. Plus, the politics are bad. It would anger the NRA (you know which one I mean) to repeal the law, and of course every Member of Congress has restaurants in their home district. One the other side, the amount of money involved is so small that it isn’t worth the effort for the songwriters and their representatives to ask Congress to fix it. The result is that for the last 20+ years, the United States has been in violation of its copyright commitments through the WTO.

So what’s the big deal? Well, this is the part that gets to diplomacy. When the WTO rules were being negotiated, the U.S. was a leader in calling for strong requirements for copyright because we have the world’s greatest copyright sector, by far. When our negotiators travel around the world demanding other countries live up to their commitments, those countries love to throw this issue back in our faces. This is especially true for the Europeans, who seem to delight in reciting how many years, months, days, hours, minutes, and seconds it has been since we lost the case to Ireland.

The practical reality is that this is a silly argument for others to make. It is a niche issue with negligible monetary consequence in the grand scheme of things. When other countries try to use this as an excuse of massive volumes of piracy in their country, it is a smokescreen. Still, it is a failing on our part that makes it harder to demand adherence to the rules by others.

It would be nice to fix this and take away the talking point from those who are trying to avoid accountability for serious problems. Unfortunately the part about the bad politics is hard to overcome. Maybe one day….

^[1] If you’re wondering, the other bill added twenty years to the length of copyright protection to match what had been put in place in Europe.