Taiwanese legislature passes amendments to manage CMOs

Taiwan’s Legislative Yuan introduced amendments to the Copyright Collective Management Organisation Act on 29 April 2022, which will create more transparency in the handling of collective management organisations (CMOs) and boost licensing efficiency between users and CMOs.

The Executive Yuan proposed the draft amendments to the Copyright Act and the Copyright Collective Management Organisation Act. While the Copyright Act is lying in the congress hall ahead of being debated, amendments to the latter have been reviewed and passed.

The amendments, according to the president of the Legislative Yuan, are aimed mainly at solving the problem of CMOs having a permanent director that grants too much power to private persons over semi-public affairs and ruining the trust these organisations have built with the public. Following these amendments, the terms of directors and supervisors shall not exceed four (4) years. They are eligible for re-election for a consecutive term; however, a director can serve no more than two consecutive terms, and the re-elected directors and supervisors shall not comprise more than two-thirds of the board.

In addition, CMOs shall have internal control over personnel, business and finance, and provide the Statement on Internal Control within three (3) months of the end of each business year to the specialised agency in charge of copyright matters.

A CMO shall also make its operational report and financial statement available to the public on its website once the reports are approved in the general meeting of its members. Further, the financial statement should be certified by a qualified accountant and returned to its supervisor for review at least thirty (30) days before the general meeting.

The efficiency of the licensing process is another highlight of the amendments. The legislatures added Article 21(4) requiring the specialised agency in charge of copyright matters to take on a more active role in assisting CMOs with adopting innovative technology to boost management efficiency, reduce cost and improve fee collection methods. However, the details of how the specialised agency will provide this, and the standard by which technology will meet the requirement of innovation, have yet to be published.

Lastly, the amendments raise the bar to set up a new CMO and welcome the public to express their opinions about the prospective organisations before the specialised agency approves the application. Among other rules, a promoter shall not be a member of CMOs in the same field or apply for more than two in the same field at the same time. To more efficiently identify unqualified applicants, the specialised agency will publicise the application form and other relevant documents on its official website to enable the public to review and leave comments for the agency. 

The amendments are considered a significant step forward in demonstrating the Taiwanese government’s commitment to joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, and its determination to build a friendly environment for IP protection.