Fitness Classes Tariff

 

Tariff V1 – Fitness Classes 

Tariff V1 - Two Tiered Reporting

 

 Fitness 2

 

 

What happened with PPCA’s Fitness Class Tariff review?

 

In December 2005, PPCA wrote to a number of fitness industry associations, including Fitness Australia, to notify them of PPCA’s intention to review the rate payable for the use of recordings in fitness classes under the Fitness Tariff and to invite them to participate in a consultation process with PPCA in relation to the review.

During 2006, PPCA met with Fitness Australia’s representatives on a number of occasions, in an attempt to reach agreement on the tariff to apply to fitness classes.

On 8 December 2006, PPCA issued formal proceedings in the Copyright Tribunal in order for the Tribunal to conduct a review of the Fitness Tariff, and determine a reasonable fee for the Fitness Tariff on the basis of economic and other evidence. 

On 25 January 2007, Fitness Australia Incorporated joined the proceedings as the First Respondent.
On 1 May 2007, the ACCC informed PPCA that it wished to join the proceedings pursuant to section 157B of the Copyright Act 1967.  On 8 May 2007, this was formalised by the Tribunal. 

The Tribunal published its decision in the Reference on 17 May 2010 and concluded, inter alia, that the licence scheme should include the options of a per-class payment and a per-attendee per class payment and that a fair and reasonable per class rate was $15 per class.

On 15 June 2010, Fitness Australia filed an application for an order of review, seeking an administrative review of the Copyright Tribunal’s decision (“Appeal”). The Federal Court heard the Appeal on 26 November 2010.

On 13 December 2010, the Full Federal Court found that the Tribunal’s decision of 17 May 2010 should be set aside on the ground that the Tribunal had acted in a way which was procedurally unfair and remitted the matter back to the Copyright Tribunal for “determination according to law.”

PPCA and Fitness Australia have since entered into discussions in an attempt to negotiate a settlement of the Reference, and on 10 October 2011, both parties agreed to adopt the licence scheme now known as Tariff V1.

The new scheme will take effect from 1 January 2012, and will be phased in over a three year period.  A copy of the tariff, with the phase in schedule following, can be viewed here

 

If you have a media query, please contact Felicity Moffat on 0418 677 701.

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Joint Statement – PPCA & Fitness Australia

 

A new pricing scheme for PPCA licensed music used in fitness classes will come into effect next year following an agreement between peak bodies representing the music and fitness industries.

The 5 year tariff scheme has been agreed between the parties after a judgment of the Copyright Tribunal of Australia was set aside by the Federal Court on appeal by Fitness Australia in December last year.

Under the new scheme, fitness centre operators can elect to pay licence fees at a flat rate applicable to all classes or at a two-tiered rate adjustable on the number of participants in each class.

The flat class rate per will be $1.50 in 2012 rising to $2.50 in 2014. The two tiered rate is set out in the table below.

The Phonographic Performance Company of Australia (PPCA) representing artists and labels and Fitness Australia said in a joint statement: “We are pleased to announce this agreement which brings to an end a period of uncertainty for recordings artists and labels and fitness centre operators using PPCA licensed music in classes. It means that the case will not have to return for another potentially lengthy hearing before the Copyright Tribunal in order to settle a rate.”

The new scheme comes into effect on 1st January 2012.

Period

Single Per Class Rate

Two Tiered Rate Per Class

01.01.12 to 31.12.12

$1.50

$0.90 per class with <10 participants

$2.10 per class with >10 participants

01.01.13 to 31.12.13

$2.00

$1.20 per class with <10 participants

$2.80 per class with >10 participants

01.01.14 to 31.12.14

$2.50

$1.50 per class with <10 participants

$3.50 per class with >10 participants

01.01.15 to 31.12.15

$2.50 plus CPI

Previous year’s rates plus CPI

01.01.16 to 31.12.16

Previous year’s rate plus CPI

Previous year’s rates plus CPI

Fitness 3


 

Frequently Asked Questions

 

1. What brought about the new Tariff V1 (Fitness Classes)?

In 2005 PPCA commenced a lengthy consultation process with the fitness industry and engaged experienced economic consultants to carry out a study to calculate the value of music in fitness classes.

Following this research and consultation, in 2006 PPCA referred a proposed licence scheme to the Copyright Tribunal of Australia for consideration.  The proposed licence scheme related to the granting of licences for the use of protected sound recordings in fitness classes.  In May 2010, the Copyright Tribunal determined a licence fee rate which was due to be implemented on 1 January 2011.  Fitness Australia appealed the Copyright Tribunal’s decision in the Federal Court.  The outcome of this appeal in December 2010 was to send the case back to the Copyright Tribunal for a redetermination.

We are pleased to advise that this has now been resolved following negotiations between PPCA and Fitness Australia, and a new Fitness Class Tariff has been agreed upon.

 

2.      When does the new Tariff V1 (Fitness Classes) start?

The new scheme will start on 1 January 2012.  Until the commencement of the scheme, the present fitness class rate of $0.968 will apply.

Under the new scheme a licensee may elect once a year, before the start of their annual licence period, whether they wish to pay their licence fees on a ‘Single Rate’ or a ‘Two Tiered Rate’, enabling licensees to select the most economical option for their class structures.  Details of both these options and their applicable fees can be found in the below Tariff V1 sheet.

 

3.      How does PPCA define a “Fitness Class” under Tariff V1 (Fitness Classes)?

A Fitness Class is defined as a “structured form of exercise conducted in a class environment…which is (a) directed and (b) included in a published time-table or advance notification to potential participants.

The following are examples (without limitation) of the types of classes included in the definition of a Fitness Class:- aerobics, circuit, dance, cycle/spin, strength/resistance, hybrid, boxing/combat, flexibility/stretching/abdominal, yoga and pilates, specialty, aqua and age/lifestyle.

For more detail on this definition, please refer to the below Tariff V1 sheet.

 

4.       What if I use “cover music” in fitness classes?

If a fitness class does not use any recordings within PPCA’s extensive repertoire, it will not require a licence under the new scheme.  

Some cover versions of original sound recordings are not included in PPCA’s repertoire.  PPCA’s extensive repertoire includes the majority of commercially released sound recordings in Australia.  Anyone operating fitness classes with music that does not have a PPCA licence (or other relevant licence, eg. directly from a record company) will need to conduct rigorous investigations to ensure that the music played is not within PPCA’s repertoire.

 

5.      To what organisations does Tariff V1 (Fitness Classes) apply?

The new licence applies to all Fitness Centres and Freelance Fitness Instructors.

A Fitness Centre means a fitness centre operating on a commercial basis as a business, including offering memberships (periodic or casual) which entitle members to go attend Fitness Classes. 

A licence is also required by Freelance Fitness Instructors meaning someone who provides fitness instruction on a commercial basis as a business, other than at a Fitness Centre or as an employee in an organisation conducting Fitness Classes.  As a result of this, non-commercial ventures whose premises are used for fitness classes should ensure that all commercially operating fitness instructors teaching classes on their premises are properly licensed. 

 

6.      How will licence fees under Tariff V1 (Fitness Classes) be calculated and invoiced?

Invoicing occurs annually in advance based upon the information provided in the PPCA Licence Application.  Where the Two Tiered Rate is selected, licence holders must provide PPCA (on a quarterly basis), month by month reports to verify the rate applicable to the licensee.

If the licence holder is liable to pay more than $1,000 in the Licence Year, paying quarterly is an option which may be selected.

 

7.      How should I contact PPCA with questions about the new fitness class scheme?

By Telephone:           02 8569 1111

By Email:                    fitness.mail@ppca.com.au

By Fax:                        02 8569 1183

By Post:                      PO Box 1230, Queen Victoria Building, NSW 1230

 

If you have a media query, please contact Felicity Moffat on 0418 677 701.

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Fitness Classes – Response Form

 

If you are a current PPCA licence holder of Tariff V – Fitness Classes/Fitness Teachers & Instructors, you will need to provide PPCA with information regarding the continuation or cancellation of your licence. 

Please visit the [Fitness Classes – Response Form] to complete and submit your details online.

To download and print a Response Form, please see below:

pdf format Response Form (203.39 KB)

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Tariff V1 – Fitness Classes Sheet

 

(Downloadable pdf format Tariff  V1))

 

Public Performance Tariff V1:

Fitness Classes

Effective Date

This Tariff applies from 1 January 2014

What is licensed under this Tariff?

Protected Sound Recordings (see definition of Sound Recordings below)

What uses are covered by this Tariff?

This Tariff covers the use of Sound Recordings accompanying a Fitness Class conducted by:

  • a Fitness Centre employing fitness instructors; or
  • a Freelance Fitness Instructor.

This Tariff does not cover the public exhibition of music video clips, including DVD or any
other similar medium (covered by Tariffs W and/or WE). This Tariff also does not cover any
other use of Sound Recordings in a Fitness Centre, including without limitation:

  • as a general amenity, or as background music, in the free weights area, specialised exercise equipment area, change rooms or other public areas of the Fitness Centre (covered by Tariff V2); or
  • in a restaurant or cafe operating within the Fitness Centre (covered by Tariff R1).

Terms used in this Tariff have the following meanings:
Fitness Centre means a fitness centre operating on a commercial basis as a business
(including, without limitation, gymnasiums, health clubs, aquatic centres, recreation centres,
leisure centres, sport centres, incidental fitness amenities and specialty centres) including
offering periodic or casual memberships (whether called by that name or any other name)
which entitle its members to attend Fitness Classes.
Fitness Class means a structured form of exercise conducted in a class environment on a
commercial basis whether at a Fitness Centre or by a freelance fitness instructor, which is:

  • directed (whether by a fitness instructor, video instruction or otherwise); and
  • included in a published time-table or advance notification to potential participants, and includes, without limitation, the following types of classes:- aerobics, circuit, dance, cycle/spin, strength/resistance, hybrid, boxing/combat, flexibility/stretching/abdominal, including yoga and pilates, specialty, aqua and age/lifestyle.

Fitness Class Use means the use of Sound Recordings to accompany Fitness Classes.
Freelance Fitness Instructor means a fitness instructor who provides fitness instruction on a
commercial basis as a business, otherwise than at a Fitness Centre or as an employee of an
organisation conducting Fitness Classes.


Sound Recordings means sound recordings the copyright in which includes the exclusive
right to cause the recordings which form part of the PPCA repertoire to be heard in public
under the Copyright Act 1968 and the Copyright (International Protection) Regulations 1969.

What are the Licence Fees?

The fee for the year 1 January 2014 to 31 December 2014 is:

  • Single Rate per PPCA Class:                                          $2.50

                              OR

  • Two Tiered Rate per PPCA Class:-
    • With 10 or fewer participants:                        $1.50
    • With more than 10 participants:                    $3.50

Fees for subsequent years can be found on the PPCA website at www.ppca.com.au.

Additional terms used in this section of the Tariff have the following meanings:

PPCA Class means a Fitness Class in which Sound Recordings comprising part of the PPCA
repertoire are used either for the entirety of the class, or part only.

Licence Year means the 12 month period following the date the licence commences.

Licence Period

Annual (but Licence Fees may be paid quarterly, as noted in Special Condition A)

Special conditions applicable to this Tariff

 

 

This Tariff is subject to the Special Conditions.

Special Condition A

A person who wishes to obtain a licence to play Sound Recordings in a Fitness Class must
advise PPCA upon application for a new licence agreement :

(a) if it wishes to pay according to Single Class Rate or the Two Tiered Rate, and

(b) if it is liable to pay more than $1000 in the Licence Year, if it wishes to pay quarterly.

Special Condition B

If a Licensee wishes to change any election notified under Special Condition A it must do so in
writing at least 40 days before the licence’s annual renewal date. Any such changed election
will take effect in the following Licence Year and apply for the whole of that Licence Year.

Special Condition C

Licence fees are payable in advance and shall be based on the number of PPCA Classes to
be held in the Licence Year as advised by the Licensee in writing and in accordance with
these Special Conditions or PPCA’s Standard Terms and Conditions.

The Licensee must advise PPCA of any variation to the number of PPCA Classes in the
Licence Year in accordance with the Standard Terms and Conditions. Where a reassessment
of the licence reduces the annual fee to an amount less than that already paid, PPCA’s refund
policy will apply.
 
Special Condition D

Where licence fees are payable pursuant to the two tiered rate set out above, the licensee is
to provide PPCA on a quarterly basis month by month reports indicating the number of
attendees in Fitness Classes conducted by the licensee, the number of attendees in PPCA
Classes conducted by the licensee and any other supporting documentation PPCA may
reasonably require to verify the two tiered participant per class rate applicable to the licensee.

Special Condition E

(1) The licensee agrees that PPCA may notify the licensee in writing that it wishes, on a day
specified in the notice, being an ordinary working day of the licensee specified in the notice
not earlier than 7 days after the day on which the notice is given, to do such of the following
things as are specified in the notice:

(a) assess the amount of public performance of Sound Recordings;

(b) inspect all the relevant records that relate to the public performance of Sound
Recordings;

(c) inspect such other records as are relevant to the assessment of the amount of equitable
remuneration payable by the licensee to PPCA.

(2) Where PPCA gives a notice, a person authorised in writing by PPCA may, during the
ordinary working hours of the relevant licensee on the day specified in the notice (but not
before 10 a.m. or after 3 p.m.), carry out the assessment, or inspect the records, to which the
notice relates and, for that purpose, may enter the premises of the licensee.

(3) The licensee shall take all reasonable precautions, and exercise reasonable diligence, to
ensure that a person referred to in paragraph (2) of this Special Condition E who attends at
the premises of the licensee for the purpose of exercising the powers conferred by that
paragraph is provided with all reasonable and necessary facilities and assistance for the
effective exercise of those powers.


 

 

ALL AMOUNTS ARE INCLUSIVE OF GST.
NOTE: Tariff V1 licences will be issued subject to PPCA’s Standard Terms and Conditions for Licences for the Public Use of Protected Sound Recordings  

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Tariff V1 – Fitness Classes Phase In Schedule

 

Period

Single Per PPCA Class Rate

Two Tiered Rate Per PPCA Class

01.01.12 to 31.12.12

$1.50

$0.90 per class with <10 participants

$2.10 per class with >10 participants

01.01.13 to 31.12.13

$2.00

$1.20 per class with <10 participants

$2.80 per class with >10 participants

01.01.14 to 31.12.14

$2.50

$1.50 per class with <10 participants

$3.50 per class with >10 participants

01.01.15 to 31.12.15

$2.50 plus CPI

Previous year’s rates plus CPI

01.01.16 to 31.12.16

Previous year’s rate plus CPI

Previous year’s rates plus CPI

 

ALL AMOUNTS ARE INCLUSIVE OF GST.

(CPI means the Consumer Price Index, being the index of that title All Groups Australia published by the Australian Bureau of Statistics, or by any authority substituted by statute.)

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