When importing equipment and physical media, importers pay not only taxes and fees to the state, but also contributions to authorized collective management organizations (CMO). Currently, in Ukraine, there are two organizations of this type that receive contributions from 33 types of devices, including TVs, mobile phones, tablets, flash memory cards, hard drives and so on.
These contributions are an additional burden for official importers of household appliances, which can not compete with the so-called “grey import”, because these contributions add value to the goods that falls on consumers. And most importantly – in recent years, experts have many doubts regarding the way these funds are allocated by CMOs and what they are used for.
The experts of the BRDO’s ICT sector together with the Ministry of Economic Development presented a draft resolution of the Cabinet of Ministers, which proposes to reduce the list of equipment subject to paying contributions significantly, at the roundtable “Effectiveness and possible revision of the regulation of contributions on equipment prices”.
According to BRDO experts, today contributions are delivered with the view of further remuneration payments to authors, performers, and producers of phonograms for reproduction at home. This issue is regulated by Article 42 of the Law of Ukraine “On Copyright and Related Rights” and the CMU’s Resolution #992 dated 27/06/2003.
At the same time, there are many questions regarding the implementation of provisions on these contributions and payments to authors. In particular:
- a lack of correct information on the amount of contributions paid;
- imperfect accounting reports of collective management organizations;
- no standardized procedure for distribution of contributions to authors and performers, and the information on these payments;
- uncertainty as to whether the equipment is subject to paying contributions or not.
This situation leads to lawsuits between CMOs and importers as well as does not allow to have a picture of the effectiveness of contributions. Moreover, the principle, under which authors and performers get the money received from contributions, is unclear.
The Better Regulation Delivery Office proposes to suspend the collection of payments to regulate this aspect better and develop an effective and transparent mechanism of contributions. According to the BRDO experts, the main problem is not related to copyright fees, since they are also paid in ⅔ of European countries. The main problem – whether these funds reach owners or not, whether they feed the Ukrainian music and film production industry, which desperately requires support today, or not.