The Market Court upheld a major part of Teosto’s demands on Finnish broadcasting company MTV

The Market Court gave its ruling on 29 November 2019 in the dispute between the Finnish Composers’ Copyright Society Teosto and the Finnish broadcasting company MTV concerning Teosto’s fees for audiovisual services.

 The Market Court upheld a major part of Teosto’s demands and, among other matters, confirmed the legitimacy of Teosto’s fee schedule for free TV channels. The Market Court also ordered MTV to pay additional royalties to composers, lyricists, arrangers and music publishers for the years 2017 and 2018.  

For several years, there has been a dispute between MTV and Teosto concerning copyright royalties for use of music content in MTV’s free and paid audiovisual services. Since 2017, MTV has refused to pay royalties in accordance with Teosto’s fee schedule. Teosto turned to the Market Court to collect the royalties unpaid by MTV and also to get a confirmation for the reasonability of its pricing. Similarly, MTV turned to the Market Court to have the royalties adjusted.

Today, the Market Court gave its ruling, mainly in favour of Teosto. Based on the ruling, MTV must pay EUR 1.7 million in royalties payable to music rightsholders for the years 2017 and 2018. In addition, MTV was ordered to pay EUR 600,000 in Teosto’s legal costs.

“We are satisfied with the fact that the Market Court has confirmed Teosto’s pricing mechanism for free TV channels. Royalties can now be distributed in full to music rightsholders. For its part, the ruling guarantees market peace and gives an opportunity for future service development,” says Teosto’s General Counsel Antti Härmänmaa.

The object of the dispute was Teosto’s new AV fee schedule adopted on 1 January 2017, which simplified Teosto’s pricing structure. The pricing model used by Teosto was considered and confirmed by the Finnish Competition and Consumer Authority already in 2017.  According to an independent analysis conducted for the legal proceedings, Teosto’s price level is in line with the average European level.

However, the additional royalties demanded by Teosto with regard to MTV’s paid channels were not imposed. Teosto will assess the impact of the decision in the next few months.

The royalties to be received from MTV can be distributed to music authors and publishers after the ruling has become final and the royalties have been received. Teosto will pay the royalties within 4–6 months of MTV’s payment to Teosto.

A possible leave to appeal the ruling must be applied for within 60 days from the date of the ruling. If leave to appeal is applied for, it may take several months before the final decision is reached.