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Music Licensing for Restaurants, Nightclubs and Bars

Copyright Law: Music Licensing for Restaurants, Nightclubs and Bars
By Justin M. Jacobson, Esq.

When operating a business, it is important for an owner to be aware of how restaurants, nightclubs, bars, and other hospitality enterprises can legally play music for its guests. Specifically, a public performance license must be obtained by the venue owner from the appropriate performing rights organization (PRO) to play the music for the owner’s patrons. This requirement applies to any establishment that is hosting live musical performances, including a live band, a solo artist, or a disc-jockey (DJ) as well as for store or restaurant that plays any music played within their establishment. In fact, this licensing requirement applies to a business playing music on traditional terrestrial radio as well as for digital and satellite radio stations and digital music streaming platforms such as SiriusXM, Pandora, Spotify, Tidal, or Apple Music

Music Licensing for Nightclubs, Bars, Restaurants, Pubs, Concert Halls, Music Venues

Typically, a business owner can obtain the appropriate license(s) from the appropriate performing rights organization (P.R.O.). Performing rights organizations license “small” performing rights in a composition. Today, there are currently four major performing rights organizations in the United States, which include the American Society of Composers, Authors & Publishers (ASCAP); Broadcast Music Inc.(BMI); the Society of European Stage Authors & Composers (SESAC); and, Global Music Rights (GMR).  These right organizations are authorized by the rights holders, typically the music publishing companies and recording labels, to license, administer, and compensate their artist members, such as songwriters and music producers, for the public performance of their works. Each performing rights organizations charges different fees and rates based on the size of the establishment. For example, a small store or club would generally pay less in licensing fees to a PRO than a large club with an extensive sound system would. (17 U.S.C. § 100 et. al.)

As discussed, nightclubs, bars, restaurants, and other hospitality establishments generally are required to obtain a license from the applicable PROs to legally play music to its guests. In most cases, a nightlife or hospitality business can receive a “blanket” license from a performance rights society.  This license permits them to publicly perform all of the songs in the society’s respective repertoire without requiring them to obtain an individual license for each song that is performed. This means that most all entertainment, culinary and other retail establishments need to acquire these licenses in order to play music for its patrons. Additionally, the use of a background music service, such as Muzak, might preclude this need for a licensing from a PRO since these types of music services already obtain the proper authorization and rights to play the music it provides. Similarly, digital music streaming platform, Spotify suggests using a music service such as Soundtrack Your Brand, which provides “background music for businesses.” In these cases, the business owner just pays for service and as part of their service fees, they receive the necessary public performance licenses. Ultimately, this means that the use of a radio or streaming of music in any business or nightlife establishment necessitates the obtaining of these licenses. Without them, the owner could potentially be liable for copyright infringement for the unauthorized public performances of music

In conclusion, most business establishments should be aware of the requirement for proper licensing when there is a public performance of music on an owner’s property. This requirement applies to concert venues, nightclubs, restaurants, retail stores and other similar hospitality establishments and the lack thereof could result in potential monetary or other liability.

This article is not intended as legal advice, as an attorney specializing in the field should be consulted.

© 2022 Justin Jacobson Law, P.C.