Trust Agreement Terms and Conditions

• Article 1 (Purpose)

  The purpose of these Terms and Conditions is to define the terms of the trust agreement between the record producer or the person who has acquired or succeeded to the rights of the record producer (hereinafter referred to as the "Settlor") and the Recording Industry Association of Korea (hereinafter referred to as the "Trustee") for the due protection of the rights of the record producer and for the smooth licensing of such rights.

• Article 2 (Trust of Rights)

  1. ① The Settlor shall select from among the rights of the record producer as stipulated in the Copyright Act, the following rights (hereinafter referred to as "Trust Rights"), and shall entrust all or part of them to the Trustee in accordance with the provisions of these Terms and Conditions, and the Trustee shall manage them for the Settlor and distribute the royalties, etc. obtained therefrom to the Settlor.
     
     • 1. Right of reproduction/transmission online, wired or wireless
     • 2. Right of reproduction/distribution/rental of offline records
     • 3. Reproduction using digital media [Reproduction using digital media refers to reproduction through electronic recording media, etc., excluding the sale of conventional offline LPs, CDs, and MCs, where there is no qualitative degradation from the original even if reproduction is repeated, and simultaneous reproduction is possible] and the right of distribution/rental thereof
     • 4. Right of reproduction/transmission/distribution of sound sources to "special types of online service providers" under the Copyright Act
  2. ② If the Settlor designates a third party as a beneficiary, the Settlor shall submit a designation application to the Trustee without delay, and in the case of transfer, assignment, or succession of neighboring rights, the beneficiary designation shall be deemed to have been terminated.
  3. ③ If the Settlor grants a license to a third party for a part of the rights entrusted to the Trustee pursuant to Paragraph 1, the Settlor shall consult with the Trustee in advance.

• Article 3 (Procedure for Concluding a Trust Agreement)

  • ① A person who intends to entrust Trust Rights shall submit an application for a trust agreement to the Trustee with the necessary documents attached.
  • ② The Settlor shall be fully notified of the Trust Agreement Terms and Conditions by the Trustee, and the Trustee shall conclude the trust agreement only after having fully understood them.
  • ③ When the Trustee has concluded a trust agreement, the Trustee shall issue a trust certificate to the Settlor.

• Article 4 (Warranty of Rights)

  • ① The Settlor shall warrant to the Trustee that the Trust Rights have arisen from the Settlor's direct production of the record or that the rights have been lawfully succeeded to or acquired from another producer.
  • ② The Trustee may request the submission of data if necessary in relation to the rights warranted by the Settlor, and the Settlor shall submit them without delay.

• Article 5 (Jurisdiction of Business)

  1. ① The Trustee shall perform the Trust Rights management business in the following areas.
     
     • 1. Republic of Korea
     • 2. Foreign countries
  2. ② The Trustee may re-entrust the management of Trust Rights in foreign countries to a foreign rights management organization.

• Article 6 (Collection and Distribution of Royalties)

  • ① The Trustee shall grant permission for the use of the Trust Rights in the area where it conducts its business and shall collect royalties in accordance with the provisions of the Royalty Collection Regulations.
  • ② The royalties under Paragraph 1 shall be distributed to the Settlor in accordance with the provisions of the Royalty Distribution Regulations.
  • ③ Notwithstanding the provisions of Paragraph 2, if the expenses required for distribution of individual royalties subject to distribution account for a significant portion of the distribution amount or if it is deemed inappropriate to distribute them, the Trustee may use them for projects for the protection of the rights and interests of record producers with the approval of the General Assembly.

• Article 7 (Calculation and Timing of Distribution of Royalties)

  The calculation and timing of distribution of royalties shall be in accordance with the Royalty Distribution Regulations.

• Article 8 (Suspension of Licensing and Distribution)

  The Trustee may suspend the licensing of Trust Rights and the distribution of royalties in any of the following cases:

  • 1. When there is an objection to the Trustee regarding the attribution of the Trust Rights
  • 2. When the Trust Rights reported by the Settlor are different from the Trustee's data
  • 3. When a lawsuit is pending over a dispute over neighboring rights and the final judgment has not been rendered

• Article 9 (Collection of Management Fees)

  • ① The Trustee may collect fees determined with the approval of the Minister of Culture, Sports and Tourism for the management of the Trust Rights.
  • ② The Trustee may appropriate an amount equivalent to the management fees from the royalties in advance as expenses necessary for the performance of its duties.
  • ③ If the total income, including management fees for a fiscal year, exceeds the Trustee's operating expenses, resulting in a surplus, or if expenditures exceed income, resulting in a deficit, the Trustee shall handle it in accordance with a resolution of the Board of Directors and obtain the approval of the General Assembly.
  • ④ The Trustee shall distribute the interest generated from the trust account to the trust contractors.

• Article 10 (Collection of Costs Associated with Rights Management)

  The expenses falling under each of the following subparagraphs shall be borne by the relevant Settlor:

  • 1. Taxes on Trust Rights
  • 2. Costs incurred in connection with the registration of Trust Rights

• Article 11 (Settlor's Reporting Obligation)

  1. ① The Settlor shall report to the Trustee without delay and follow the prescribed procedures if any of the following events occur:
     
     • 1. When a new record is produced or rights are succeeded to or acquired
     • 2. When a reason for restricting the disposition of Trust Rights arises or ceases to exist
     • 3. When a document proving the trust is lost
     • 4. When the corporate name, name, address, or remittance destination is changed
     • 5. When the representative, agent, or receiving agent of the Settlor is changed
     • 6. When any other event that may interfere with the exercise of the Trust Rights occurs
  2. ② Any damages arising from the neglect of the obligations under each subparagraph of Paragraph 1 shall be borne by the Settlor.

• Article 12 (Assignment of Trust Rights and Establishment of Pledge)

  The Settlor may not assign the Trust Rights or the right to claim distribution of royalties or establish a pledge thereon without the consent of the Trustee, and the beneficiary may not perform any disposition, such as assignment, succession, or provision of security for the beneficial right.

• Article 13 (Succession of Agreement)

  • ① In the event of the death of an individual Settlor or the merger of a corporate Settlor, the heir or the corporation succeeding to the relevant Trust Rights may succeed to the rights and obligations of the Settlor under the trust agreement. In this case, the heir or the succeeding corporation shall report the fact of succession to the rights and obligations of the Settlor to the Trustee without delay.
  • ② If there are multiple heirs under Paragraph 1, one of them shall be appointed as a representative and reported.

• Article 14 (Notice to the Settlor)

  All notices to the Settlor shall be sent to the address reported by the Settlor. However, if the Settlor resides in a foreign country, they shall be sent to the address of the agent in Korea.

• Article 15 (Term and Renewal of Agreement)

  • ① The term of the trust agreement shall be five years from the date of conclusion of the agreement.
  • ② If the Settlor does not notify the Trustee in writing of its intention not to renew the agreement at least six months before the expiration of the agreement term, the agreement shall be deemed to have been renewed under the same conditions as before.

• Article 16 (Termination of Agreement, etc.)

  1. ① The Trustee shall terminate the trust agreement if all of the Settlor's rights have been extinguished due to the expiration of the rights protection period, etc.
  2. ② The Trustee may terminate the agreement in any of the following cases:
     
     • 1. When the Settlor is declared bankrupt or is dissolved
     • 2. When the Settlor has violated these Terms and Conditions
     • 3. When the Settlor has received royalties by falsely entrusting the neighboring rights of another person
  3. ③ The Settlor may terminate the trust if the Trustee fails to fulfill its obligations under the copyright trust management or if the Settlor is unable to maintain the contractual relationship due to unavoidable personal reasons.
  4. ④ Termination of this Agreement shall be in writing, and the effect of termination shall take effect six months after the other party to the agreement receives the notice of termination. However, this shall not apply in the case of termination due to the expiration of the rights protection period.
  5. ⑤ If the agreement with the Settlor is terminated, the Trustee shall post information such as the date of termination, the name of the Settlor, and the album name/song title of the entrusted neighboring works on the Trustee's website within 15 days from the date of termination.
  6. ⑥ The Trustee shall promptly return the trust certificate to the Settlor after the termination or cancellation of the trust agreement to transfer the Trust Rights, and shall pay and submit the unpaid royalties and the settlement statement thereof to the Settlor within six months.

• Article 17 (Right of Action)

  The Trustee may file a civil or criminal lawsuit against the infringer if an infringement occurs in connection with the management of the Trust Rights and royalties, etc.

• Article 18 (Notice of Change of Terms and Conditions)

  • ① If these Terms and Conditions are changed, the Trustee shall announce it without delay and notify the Settlor.
  • ② A Settlor who has an objection to the change of the Terms and Conditions under Paragraph 1 may terminate this Agreement in writing within 90 days from the date of notification, and if the right of termination is not exercised during this period, the trust agreement shall be deemed to have been changed by the changed Terms and Conditions. However, if the right of termination is exercised, the previous Terms and Conditions shall apply until the termination takes effect.

• Article 19 (Trustee's Notice)

  Remittances and other notices from the Trustee to the Settlor shall be sent to the address applied for by the Settlor. If the Settlor resides in a foreign country, they shall be sent to the address of the receiving agent in Korea.

• Article 20 (Liability for Damages)

  • ① The Settlor and the Trustee shall compensate for any damages caused to the other party by violating these Terms and Conditions.
  • ② The Trustee may first deduct the damages incurred under Paragraph 1 from the royalties obtained through the management of the Trust Rights.

• Article 21 (Amendment of Terms and Conditions)

  To amend these Terms and Conditions, it is necessary to obtain the approval of the Minister of Culture, Sports and Tourism through a resolution of the General Assembly of Delegates.

• Article 22 (Public Notice)

  The public notices stipulated in these Terms and Conditions shall be implemented by publishing them in the bulletin issued by the Trustee or on the notice board of the website operated by the Trustee.

• Article 23 (Enactment of Detailed Rules for Terms and Conditions)

  Matters necessary for the implementation of these Terms and Conditions shall be determined as detailed rules through a resolution of the Board of Directors.

• Article 24 (Relationship with Other Laws)

  Matters not otherwise provided for in these Terms and Conditions shall be governed by the provisions of the Trust Act and the Civil Act.

• Article 25 (Jurisdiction)

  The court having jurisdiction over the address of the defendant shall have jurisdiction over any lawsuit concerning the agreement concluded under these Terms and Conditions. However, if otherwise agreed between the parties, the agreed court shall be the competent court.

Addendum

These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• [Addendum 1 - 2001. 11. 17]

  • 1. These Terms and Conditions shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.
  • 2. Notwithstanding the provisions of Article 2, Paragraph 1 and Article 18, the application of Article 2, Paragraph 1, Subparagraph 2 shall apply only to members who have completed a separate individual consent procedure after the date of approval of these regulations by the Minister of Culture, Sports and Tourism.

• [Addendum 2 – 2012. 04. 27]

  • 1. These Terms and Conditions shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.
  • 2. Notwithstanding the provisions of Article 18, the application of Article 2 shall apply only to those who have completed a separate individual notification procedure after the date of approval by the Minister of Culture, Sports and Tourism, or who have newly concluded a trust agreement.

• [Addendum 3 – 2013. 05. 09]

  Article 1 Effective Date

  • These Terms and Conditions shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• [Addendum 4 – 2017. 04. 21]

  Article 1 Effective Date

  • These Terms and Conditions shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

Royalty Collection Regulations

• Chapter 1 General Provisions

  • Article 1 (Purpose)

    The purpose of these Regulations is to stipulate matters concerning the collection of royalties for the use of the rights of record producers (hereinafter referred to as "Trust Rights") that the Recording Industry Association of Korea (hereinafter referred to as the "Association") has been entrusted with and manages, among the rights of reproduction, distribution, rental, and transmission under Articles 78 to 81 of the Copyright Act, by agreement between the Association and users, pursuant to Article 49, Paragraph 1 of the Enforcement Decree of the Copyright Act.

  • Article 2 (Documentation of Agreement)

    The Association shall conclude a use agreement in writing with a person who intends to use the Trust Rights it manages.

  • Article 3 (Classification of Use)

    The classification of use of the sound sources managed by the Association is as follows:

    • 1. Online reproduction and transmission
    • 2. Reproduction and distribution using digital media
    • 3. Others

• Chapter 2 Transmission Royalties

  • Article 4 (On-Demand Streaming Service)

    1. ① The royalty for providing music works (including music videos, hereinafter the same in this chapter) requested by consumers in a streaming method and charging consumers in proportion to the number of uses, or for providing them free of charge for the purpose of selling a specific product (service), is as follows.
       

       6.16 KRW (per track) × Number of uses

       • - Note 1) The number of uses shall be based on the data provided by the user, but if there is a disagreement on the criteria for calculating the number of uses, it shall be determined by mutual agreement. The user shall keep the data (log file) for at least one year (hereinafter the same in this chapter).
       • - Note 2) Specific products (services) do not include the monthly flat-rate streaming products of Paragraph 2 and the offline playback streaming products of Paragraph 3.
    2. ② Notwithstanding Paragraph 1, the royalty for providing music works in a streaming method for a monthly flat rate (hereinafter referred to as "monthly flat-rate streaming product") shall be the greater of the following.
       
       • 1. [3.08 KRW (per track) × Number of uses] or [Monthly 3,080 KRW (per subscriber) × Number of subscribers × Music Work Management Ratio]
       • 2. Revenue × 48.25% × Music Work Management Ratio
       • - Note 1) The royalty under Subparagraph 1 may be selected by the user on an annual basis.
       • - Note 2) A subscriber refers to a member who is allowed to use the service in the case of a membership system, and in the case of a mixture of membership and non-membership systems or a non-membership system, it refers to a unique visitor who has used the monthly service. However, if it is difficult to identify the unique visitors who have used the monthly service, it shall be determined separately by agreement between the Association and the user (hereinafter the same in this chapter, except as otherwise specifically provided in these regulations).
       • - Note 3) The Music Work Management Ratio refers to the usage ratio of music works managed by the Association among the music works used by the user (hereinafter the same).
       • - Note 4) Revenue refers to the total gross sales, which is the sum of the income from usage fees obtained from the relevant service on the service site directly or indirectly operated by the user, and the income from advertising and other sources, and includes the amount discounted due to sales promotion activities, etc. However, the income from advertising and other sources shall be calculated by reflecting the proportion of music on the relevant service site, and if there is no revenue, it shall be determined separately by agreement between the Association and the user (hereinafter the same in this chapter).
       • - Note 5) In the settlement of royalties for online music service providers, if the in-app payment service and the PC WEB service are the same, the royalty for the in-app payment service shall be settled by applying the price and settlement formula of the PC WEB service. (This applies to Article 4 and Article 5.)
       • - Note 6) Notwithstanding the method of calculating royalties under this Article, the Association may, at the user's request, calculate the royalties by dividing them by subscriber unit, in which case the royalties shall be the sum of the following amounts. However, if an agreement is not reached, the method of calculating royalties under this Article shall be followed (hereinafter the same in this Article).
         
         • 1. The total sum of [(Revenue per using subscriber × 48.25% or per-subscriber unit price (monthly 3,080 KRW), whichever is greater) × Music Work Management Ratio per using subscriber]
         • 2. (Total revenue from non-using subscribers × 48.25% or total per-subscriber unit price (monthly 3,080 KRW), whichever is greater) × Average of Music Work Management Ratio per using subscriber
         • * In the case of Paragraph 3, the per-subscriber unit price shall be 5,259.25 KRW per month.
    3. ③ Notwithstanding Paragraph 2, if a monthly flat-rate streaming product includes a function that allows consumers to play it offline during the subscription period (provided that the sound source stored for offline playback does not have properties similar to downloading, such as extraction, reproduction, or sharing), the royalty shall be the greater of the following.
       
       • 1. Monthly 5,259.25 KRW (per subscriber) × Number of subscribers × Music Work Management Ratio
       • 2. Revenue × 48.25% × Music Work Management Ratio

       - Note) The user shall aggregate and submit the number of uses played offline.

    4. ④ Notwithstanding Paragraphs 1 to 3, the royalty for providing music works to consumers free of charge in a way that exposes advertisements when consumers listen to music works for the purpose of advertising revenue (hereinafter referred to as "advertisement-based streaming product") shall be as in Subparagraph 1. However, if the amount is less than that of Subparagraph 2, it shall be as in Subparagraph 2.
       
       • 1. 3.38 KRW (per track) × Number of uses
       • 2. Revenue × 48.25% × Music Work Management Ratio

       - Note 1) Even if the method of exposing advertisements when consumers listen to music works is adopted, if the purpose is not advertising revenue but the sale of a specific product (service), Paragraph 1 shall apply.

    5. ⑤ In the case of on-demand streaming, if there is no usage fee, the total playback time does not exceed 30 seconds per track, and the music work is provided on one's own homepage and server, the royalty may be exempted for the following subjects upon prior notification. However, the playback time may be adjusted by agreement within 60 seconds.
       
       • 1. When the user provides the service with the same track as the one to be sold for sales promotion
       • 2. When the author, performer, or record producer uploads his/her own work or a work related to his/her performance or record on his/her own homepage

  • Article 5 (On-Demand Download Service)

    1. ① The royalty for providing music works requested by consumers in a per-track download method shall be as in Subparagraph 1. However, if the amount is less than that of Subparagraph 2, it shall be as in Subparagraph 2.
       
       • 1. 367.5 KRW (per track) × Number of downloads
       • 2. Revenue × 52.5% × Music Work Management Ratio

       - Note 1) Download includes storing in a virtual space managed by the consumer.

       - Note 2) The number of downloads shall be based on the data provided by the user, but if there is a disagreement on the criteria for calculating the number of downloads, it shall be determined by mutual agreement. The user shall keep the data (log file) for at least one year (hereinafter the same in this chapter).

    2. ② Notwithstanding the provisions of Paragraph 1, in the case of selling in album units consisting of 5 or more and less than 30 tracks (excluding compilation albums), the royalty shall be the greater of the following.
       

       1. 183.75 KRW (per track) × Adjustment factor × Number of downloads

       2. Revenue × 52.5% (music usage rate) × Music Work Management Ratio

       Note 1) The annual adjustment factors are as follows:

       Year	2019	2020	2021 and after
       Adjustment Factor	1.2	1.6	2.0

    3. ③ Notwithstanding the provisions of Paragraph 1, in the case of providing a large number of downloads of 30 or more tracks, the royalty shall be the greater of the following.
       

       1. Per-track unit price × Adjustment factor × Number of downloads

       2. Revenue × 52.5% × Music Work Management Ratio

       • - Note 1) The per-track unit price shall be 183.75 KRW per track for 30 tracks, with a 1% discount from the previous unit price for each additional track, and 128.63 KRW per track for 65 or more tracks. After 2021, the per-track unit price shall be 183.75 KRW regardless of the number of tracks.
       • - Note 2) In the case of providing a large-volume download product available within a period of 2 months or more, the per-track unit price shall be applied by converting the number of tracks of the product into a monthly standard product.
       • - Note 3) If the user adds tracks that can be used within 1 month at his/her own expense to a large-volume download product (original product), the per-track unit price of the original product shall be applied.
       • - Note 4) The annual adjustment factors are as follows:
         

         Year	2019	2020	2021 and after
         Adjustment Factor	1.2	1.6	2.0

    4. ④ In the case of a service that restricts the use period of downloaded music works (for 1 month or less) or allows use only upon re-payment for the track (or the product in the case of Paragraph 3) after the restricted period, Paragraphs 1 to 3 shall apply, but the per-track unit price shall be 38% of the per-track unit price determined in Paragraphs 1 to 3. However, after 2021, the per-track unit price determined in Paragraphs 1 to 3 shall be followed.
    5. ⑤ In the case of providing a combination of the download service of Paragraph 1 (limited to cases where 30 or more tracks are provided in a bundle) and the streaming service of Article 4, Paragraph 2, the royalty shall be the following amount.
       

       (Streaming royalty of Article 4, Paragraph 2 × 0.5) + Corresponding download royalty

       Note 1) However, after 2021, the streaming royalty of Article 4, Paragraph 2 + the corresponding download royalty.

  • Article 5-2 (Deferment of Product Composition)

    The Association may, at the request of the rights holder, exclude a monthly flat-rate streaming product, a large-volume download product of 30 or more tracks, or both, from the service for a specified period.

  • Article 5-3 (Sales Promotion, etc.)

    • ① If a rights holder (in the case of entrusting to a trust management organization, the settlor, hereinafter the same in this Article) or a distribution service provider intends to provide sound sources free of charge for on-demand streaming services or on-demand download services for the purpose of promoting a specific work or service product with the consent of all related rights holders, a management fee of 10,000 KRW per track shall be paid to the Association.
    • ② If a rights holder or a distribution service provider discounts the royalty under these regulations or the usual royalty for a specific service product for the purpose of promotion or sales promotion, the Association may apply a separate discount rate in consultation with the user.

  • Article 6 (On-Demand Background Music Service)

    The royalty for providing music works requested by consumers as a background music service on personal homepages, etc., shall be the greater of the following:

    • 1. 175 KRW per track × Number of sales × Music Work Management Ratio × Discount rate
    • 2. Revenue × 35% × Music Work Management Ratio × Discount rate

    - Note 1) The discount rate shall be 0.9 if the period is limited to 6 months or less.

  • Article 7 (Broadcast Retransmission Service)

    1. ① The royalty for retransmitting music-specialized radio broadcasts (AOD) is as follows. For non-music-specialized broadcasts, the royalty shall be 1/2 of the following.
       
       • 1. If there is a usage fee or advertising fee (however, if the royalty in this case is less than that of Subparagraph 2, the provisions of Subparagraph 2 shall apply.)
         
         
         [Revenue × 2.5% × Music Work Management Ratio]
       • 2. If there is no usage fee or advertising fee
         
         
         [Monthly 60 KRW × Number of users × Music Work Management Ratio]
         
         

       - Note 1) The number of users refers to the number of non-duplicate users who used the retransmission service in the relevant month.

    2. ② The royalty for retransmitting TV broadcasts (VOD) shall be 1/2 of the provisions of Paragraph 1.

  • Article 8 (Online Games and Animations, etc.)

    1. ① The royalty for music services for online games and animations (per episode) that primarily use music shall be the greater of the following:
       
       • 1. Revenue × 22% × Music Work Management Ratio
       • 2. [Annual 440,000 KRW per track × Number of managed tracks] or [6.16 KRW × Number of uses × Music Work Management Ratio]
       • - Note 1) The royalty payment method under Subparagraph 2 may be selected by the user annually.
       • - Note 2) Online games and animations that primarily use music refer to services where music is used as an essential element, such as having to operate the game in time with the music or the game being impossible to proceed if the music is not played.
       • - Note 3) Revenue refers to the sum of the income from usage fees, etc., generated by the music service provided by the game and animation on the relevant site, and the income from advertising and other sources (excluding income generated from paid goods used by consumers for purposes other than music playback). However, the income from advertising and other sources shall be calculated by reflecting the proportion of music on the relevant service site.
       • - Note 4) When applying the provisions of Paragraph 1, Subparagraph 2 of this Article to services with a music use period of less than one year, the royalty shall be calculated by applying a monthly royalty obtained by multiplying the annual per-track royalty by 1/12 on a monthly basis.
    2. ② The monthly per-track royalty for music services for online games and animations (per episode) that use music as a supplement is as follows.
       

       18,000 KRW × Number of managed tracks

  • Article 9 (Homepage Background Music Service)

    The royalty for a company using background music on its homepage, etc., is as follows:

    Average monthly visitors	Amount
    Less than 5,000	8,000
    5,000 to less than 10,000	20,000
    10,000 or more	60,000

  • Article 10 (Service Using Telephone)

    The royalty for using music through a telephone (mobile phone, landline phone, etc.) in the form of a ringtone, ringback tone, or other similar methods is as follows:

    Revenue × 30% × Music Work Management Ratio

  • Article 10-2 (Music On Hold Service)

    The per-track royalty for using music by wired transmission of a telephone service and its own transmission for the purpose of being received by a general telephone is as follows:

    Number of channels	Annual royalty
    1-10 channels	50,000 KRW
    11-20 channels	95,000 KRW
    21-30 channels	135,000 KRW
    31-50 channels	170,000 KRW
    51-80 channels	200,000 KRW
    81-120 channels	225,000 KRW
    121-200 channels	250,000 KRW
    201-300 channels	300,000 KRW
    301-500 channels	400,000 KRW
    501-1,000 channels	600,000 KRW
    1001 channels or more	Negotiable

    Note 1) If the period of use is less than one year, the royalty may be calculated on a monthly basis, with the monthly royalty being 1/12 of the annual royalty in the table above.

  • Article 10-3 (Royalty for Combined Services)

    In the case of combining services other than those in Article 5, Paragraph 5, the royalty shall be determined by agreement between the Association and the user, taking into account the nature of the combined service, based on the sum of the respective royalties stipulated in the Association's regulations.

  • Article 10-4 (Overseas Service)

    The royalty for providing a separate music service to overseas consumers shall be determined by agreement between the Association and the user, taking into account the service provision price, etc., and shall be confirmed with the approval of the Minister of Culture, Sports and Tourism.

• Chapter 3 Reproduction Royalties

  • Article 11 (Movies, Videos, Advertisements, and other Video Works)

    1. ① The reproduction royalty for video works such as movies, videos, and advertisements shall be determined in consultation with the user.
    2. ② The reproduction and distribution royalty for producing a photo album (wedding, couple, 60th birthday, growth video, etc.) is as follows:

    Sales price × 6% × (Number of approved tracks / Number of recorded tracks) × Sales quantity

• Chapter 4 Supplementary Provisions

  • Article 12 (Other Royalties)

    1. ① For services for which there are no royalty collection regulations, the Association may grant a license by agreeing on a usage rate or amount with the user.
    2. ② If a license is granted under Paragraph 1, the Association shall report it in writing to the Minister of Culture, Sports and Tourism within one month from the date of the license.
    3. ③ If the Association intends to renew a contract with the same or similar content as the service under Paragraph 1 or to grant a license to another business operator, it must be based on the royalty collection regulations approved by the Minister of Culture, Sports and Tourism.

  • Article 12-2 (Supplementary Provisions Regarding Mutual Consultation)

    1. ① If a consultation is not reached regarding matters to be determined by consultation between the Association and the user in accordance with these Regulations, it shall be subject to the mediation of the Ministry of Culture, Sports and Tourism.
    2. ② If a consultation is not reached between the Association and the user regarding the interpretation of these Regulations or the provisions to be applied to the service, it shall be subject to the interpretation of the Ministry of Culture, Sports and Tourism.

• Addendum

  These regulations shall enter into force on May 1, 2008.

• Addendum (2012. 6. 8.)

  • Article 1 (Transitional Provisions)

    1. ① These amended regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism. However, in the case of Article 4 and Article 5, they shall enter into force on January 1, 2013.
    2. ② With respect to the services under Article 4 and Article 5, subscribers on an automatic payment basis at the time of the enforcement of these amended regulations (January 1, 2013) shall be subject to the previous regulations until June 30, 2013, if the product exists and automatic payment is maintained.

• Addendum (2012. 12. 26.)

  • Article 1 (Effective Date)

    These regulations shall enter into force on January 1, 2013.

• Addendum (2012. 12. 27.)

  • Article 1 (Effective Date)

    These regulations shall enter into force on January 1, 2013.

• Addendum (2013. 3. 18.)

  • Article 1 (Effective Date and Transitional Provisions)

    1. ① These amended regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism. However, in the case of Article 4, Paragraph 2, they shall enter into force on May 1, 2013.
    2. ② With respect to the service under Article 4, Paragraph 2, subscribers using the service on an automatic payment basis before April 30, 2013, shall be subject to the regulations at the time of subscription until June 30, 2013.

• Addendum (2013. 5. 9.)

  • Article 1 (Effective Date)

    These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• Addendum (2014. 12. 4.)

  • Article 1 (Effective Date)

    These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• Addendum (2015. 12. 23.)

  • Article 1 (Effective Date and Transitional Provisions)

    1. ① These amended regulations shall enter into force on February 22, 2016.
    2. ② With respect to the services under Article 4, Paragraph 2, Subparagraph 1 and Article 5, Paragraph 3, subscribers using the service on an automatic payment basis before February 21, 2016, shall be subject to the regulations at the time of subscription until August 31, 2016.

• Addendum (2016. 1. 25.)

  • Article 1 (Effective Date)

    These amended regulations shall enter into force on February 1, 2016.

• Addendum (2016. 3. 28.)

  • Article 1 (Effective Date)

    These amended regulations shall enter into force on April 1, 2016.

• Addendum (2016. 10. 19.)

  • Article 1 (Effective Date)

    These amended regulations shall enter into force on November 1, 2016.

• Addendum (2018. 6. 20.)

  • Article 1 (Effective Date and Transitional Provisions)

    • ① These amended regulations shall enter into force on January 1, 2019.
    • ② With respect to the services under Article 4 and Article 5, subscribers on an automatic payment basis before the enforcement of these amended regulations (January 1, 2019) shall continue to be subject to the previous regulations if the product exists and automatic payment is maintained.

• Addendum (2018. 6. 20.)

  • Article 1 (Effective Date and Transitional Provisions)

    • ① These amended regulations shall enter into force on January 1, 2019.

• Addendum (2019. 12. 06.)

  • Article 1 (Effective Date)

    These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• Addendum (2023. 5. 9.)

  • Article 1 (Effective Date)

    These amended regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism. In the case of Article 4, Paragraph 2, Note 5), it shall apply only to sales from June 2022 to May 2024 (2 years).

• Addendum (2023. 6. 26.)

  • Article 1 (Effective Date and Transitional Provisions)

    • ① These amended regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.
    • ② In the case of Article 12, it shall apply from the case of a new license being granted under this provision after the enforcement of the amended regulations.

• Addendum (2023. 9. 15.)

  • Article 1 (Effective Date)

    These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

Royalty Distribution Regulations

• Article 1 (Purpose)

  The purpose of these Regulations is to stipulate matters concerning the distribution of royalties (hereinafter referred to as "royalties") collected as consideration for the management of music works entrusted to the Recording Industry Association of Korea (hereinafter referred to as the "Association").

• Article 2 (Definitions)

  The definitions of terms used in these Regulations are as follows:

  • 1. Rights Holder: A record producer who has concluded a trust agreement with the Association and a person who has succeeded to such rights.
  • 2. Managed Work: A work submitted to and registered with the Association by a Rights Holder.
  • 3. Usage Details: Data describing usage reports, sound source usage details, sales data, and other work usage details submitted by users, including data obtained by the Association through investigation by external organizations.
  • 4. Past Royalties: Money and things that can be converted into money generated as compensation for infringing acts that occurred in a non-contractual state through lawsuits and equivalent legal actions, such as damages and settlements for infringement of rights. However, this does not include non-distributable agreements such as banner advertisements and event hosting generated as a condition of settlement, etc.

• Article 3 (Persons Eligible for Distribution)

  1. ① Royalties subject to distribution shall be distributed to the settlor of the work subject to distribution or the person who has succeeded to such rights.
  2. ② Past royalties shall be distributed to the person who holds the status of being eligible for distribution under the preceding paragraph as of the time of infringement.

• Article 4 (Works Subject to Distribution)

  1. ① Works subject to distribution shall be works used during the collection period of the royalties subject to distribution or works that have become the subject of collection.
  2. ② Even if a work is listed as a managed work in the distribution data, if the Association recognizes that it is not a work subject to distribution through a resolution of the Board of Directors, it shall be excluded from the works subject to distribution.

• Article 5 (Distribution Data)

  1. ① The Association shall distribute royalties in accordance with the usage details submitted by the user.
  2. ② If the data submitted by the user is not appropriate or if it is practically impossible to secure the usage details, the usage details of a business operator of a similar type may be used as distribution data through a resolution of the Board of Directors. In this case, the Association shall report the resolution of the Board of Directors to the Minister of Culture, Sports and Tourism.

• Article 6 (Calculation of Distribution Amount)

  1. ① The distribution amount for each rights holder shall be calculated as follows:

     Distribution amount per rights holder = Total distribution amount / Total usage of works subject to distribution × Usage of the relevant rights holder

     Note 1) The total distribution amount refers to the amount obtained by deducting the management fee under the 'Management Fee Regulations' from the total amount of royalties collected from the business operator in the relevant quarter.

  2. ② The final distribution amount for the person eligible for distribution shall be the sum of the carry-over distribution amount.

• Article 7 (Distribution Adjustment)

  If it is found that royalties have been distributed in error, the relevant rights holder shall be notified, and the difference may be recovered from or additionally distributed to the royalties to be distributed in the following month.

• Article 8 (Timing of Distribution)

  1. ① The Association shall distribute royalties for each user within 3 months after the distribution data is secured and the royalties are collected.
  2. ② If a temporary change in the distribution target royalties and the distribution period under the preceding paragraph is unavoidable due to unavoidable circumstances, it may be changed through a resolution of the Board of Directors.

• Article 9 (Handling of Deposit Interest)

  Interest from the receipt to the distribution of royalties shall be used for the member welfare fund.

• Article 10 (Suspension of Royalty Distribution)

  The Association may suspend the distribution of royalties if there is a civil or criminal dispute regarding the attribution of trust rights in accordance with Article 8 of the Trust Agreement Terms and Conditions.

• Article 11 (Amount Held for Royalty Claims)

  1. ① In preparation for cases where a work or a person eligible for distribution cannot be specified due to unclear information, or is omitted from the distribution data for other reasons such as a business operator's request for settlement and return, a reserve may be accumulated by deducting in advance from the distribution target amount at the following rate:

     Reserve ratio: Determined by the Board of Directors within 5% of the distribution target amount

  2. ② The reserve amount determined in this article shall be redistributed in the last distribution period of the following year based on the relevant usage list.
  3. ③ If the royalties to be paid exceed the reserve amount for the relevant month and the distribution reserve is insufficient, the royalties shall be paid by adding the reserve amount from the distribution period immediately preceding the relevant distribution month.

• Article 12 (Objection)

  1. ① If a settlor has an objection to the distribution method, distribution amount, etc., he/she may file an objection with the Association within one year from the time his/her trust rights were used.
  2. ② If a settlor wishes to file an objection regarding distribution, he/she must apply to the Association by attaching data that can prove the used rights and the fact that the rights were used to the 'Royalty Distribution Objection Form' in Appendix Form 1.
  3. ③ When the Association receives an objection, it shall confirm the content of the application by methods such as checking it against the data stored at the Association and determine its appropriateness.
  4. ④ The Association shall process the objection within one month of receipt and notify the applicant and the relevant rights holder of the results. However, this shall not apply if it cannot be processed within the period due to reasons such as duplication of rights or a considerable distribution period related to the objection.

• Article 13 (Use of Undistributed Funds for Public Interest Purposes)

  If royalty distribution is impossible for any of the following reasons and the distribution amount is not received by the end of 3 years from the date of public notice of royalty payment through promotional media, the Association may use the royalties for projects to promote the rights and improve the status of its members with the approval of the Minister of Culture, Sports and Tourism through a resolution of the General Assembly:

  • 1. When the cumulative distribution amount of the person eligible for distribution for 3 years is less than 10,000 KRW
  • 2. When the whereabouts of the person eligible for distribution are unknown
  • 3. When the person eligible for distribution refuses to receive the distribution amount

• Article 14 (Enforcement Rules)

  Matters necessary for the enforcement of these Regulations shall be determined as enforcement rules through a resolution of the Board of Directors.

• Article 15 (Amendment of Regulations)

  To amend these Regulations, it is necessary to obtain the approval of the Minister of Culture, Sports and Tourism through a resolution of the Board of Directors.

Addendum

• [Addendum 1 – 2003. 03. 17]

  Article 1 (Effective Date)

  • These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• [Addendum 2 – 2003. 10. 16]

  Article 1 (Effective Date)

  • These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• [Addendum 3 – 2005. 06. 27]

  Article 1 (Effective Date)

  • These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• [Addendum 4 – 2009. 06. 08]

  Article 1 (Effective Date)

  • These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• [Addendum 5 – 2011. 12. 30]

  Article 1 (Effective Date)

  • These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• [Addendum 6 – 2013. 05. 09]

  Article 1 (Effective Date)

  • These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• [Addendum 7 – 2017. 05. 04]

  Article 1 (Effective Date)

  • These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• [Addendum 8 – 2022. 10. 28]

  Article 1 (Effective Date)

  • These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

Trust Management Fee Regulations

• Article 1 (Purpose)

  The purpose of these regulations is to stipulate matters concerning the fees (hereinafter referred to as "management fees") necessary for the performance of the neighboring rights trust management business of the Recording Industry Association of Korea (hereinafter referred to as the "Association").

• Article 2 (Management Fees)

  1. ① The Association's management fee rate shall be within 13% of the royalties.
  2. ② The Association shall determine the management fee rate annually within the scope of Paragraph 1 by a resolution of the Board of Directors and obtain the approval of the General Assembly of Delegates.

• Article 3 (Timing of Deduction of Management Fees)

  Management fees shall be deducted at the time of royalty distribution. However, up to 50% of the management fees may be deducted in advance at the time of royalty collection to cover the expenses necessary for business performance, depending on management conditions, etc.

• Article 4 (Amendment)

  To amend these regulations, it is necessary to obtain the approval of the Minister of Culture, Sports and Tourism through a resolution of the General Assembly of Delegates.

Addendum

• Addendum (2003. 3. 17)

  These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• Addendum (2005. 9. 9)

  These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• Addendum (2008. 7. 1)

  • Article 1 (Effective Date)

    These regulations shall apply from July 1, 2008.

  • Article 2 (Transitional Measures)

    The management fee rate from September 2006 to June 2008 shall be governed by the previous regulations.

• Addendum (2009. 10. 30)

  • Article 1 (Effective Date)

    These regulations shall apply from November 1, 2009.

• Addendum (2011. 12. 30)

  • Article 1 (Effective Date)

    These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

  • Article 2 (Transitional Measures)

    The management fee rate before the enforcement of these regulations shall be governed by the previous regulations.

• Addendum (2013. 5. 9)

  • Article 1 (Effective Date)

    These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

• Addendum (2016. 7. 1)

  • Article 1 (Effective Date)

    These regulations shall enter into force on the date of approval by the Minister of Culture, Sports and Tourism.

Trust Music Promotion Regulations

• Chapter 1 General Provisions

  • Article 1 (Purpose)

    The purpose of these regulations is to promote the efficient performance of promotions by stipulating matters concerning the marketing activities related to the promotion of the Association's trust music, thereby promoting the use of trust music and increasing the Association's sales.

  • Article 2 (Definitions)

    The following definitions shall apply to the promotion activities of these regulations:

    • 1. Music subject to promotion: Newly produced trust music within 2 weeks before release
    • 2. Management fee: Fee generated by the Association's management rate among trust royalties

• Chapter 2 Promotion Targets and Support Details

  • Article 3 (Classification of Support)

    The targets for promotion expense support shall be in accordance with the following classifications:

    • 1. General expense support: Trust contractors with an Association management fee exceeding 4 million KRW within the last year as of the time of the promotion request
    • 2. Partial expense support: Trust contractors with an Association management fee of 2 million KRW or more and 4 million KRW or less within the last year as of the time of the promotion request
    • 3. Other: Trust contractors other than those in Subparagraphs 1 and 2

  • Article 4 (Budget Scope)

    Support cannot exceed the promotion budget for the current year.

    Classification	General Support	Partial Support	Other Support
    Event	Mutual agreement	Mutual agreement	X
    Design	Production support (event pages, banners, etc.)	X	X
    Latest music exposure	Mutual agreement	Mutual agreement	Mutual agreement
    Prize delivery	Association support	X	X
    Follow-up measures	Sharing of promotion progress results	Sharing of promotion progress results	Sharing of promotion progress results

  • Article 5 (Promotion Support and Details)

    Promotion support and details shall be proposed to and carried out with the user (service provider) in mutual consultation with the trust contractor (member) in accordance with the following classifications, and the progress of the promotion shall be provided to the trust contractor (member).

  • Article 6 (Deliberation and Procedure for Promotion Support Targets)

    The support and execution procedures based on Article 5 above shall be as follows:

    • 1. The selection of support targets must be approved by the Executive Director. However, if the Association anticipates activation of the trust and an increase in the Association's sales among the new albums of the trust contractors under Article 3, Subparagraph 3, the promotion manager (team leader) may provide the other support of Article 5 of these regulations to the trust contractor through its own deliberation.
    • 2. The support of expenses shall be executed in accordance with general accounting procedures, but may not exceed the relevant project budget.

  • Article 7 (Exclusion from Promotion Targets)

    In the event of the following reasons, the contractor may be excluded from the next promotion target:

    • 1. If it is revealed that the rights holder is false
    • 2. If the Association is restricted from promotion by the user (service provider) due to failure to fulfill the obligations of Article 8 of these regulations

• Chapter 3 Supply and Delivery of Promotion Prizes

  • Article 8 (Own Expense)

    In accordance with Article 5 Promotion Support and Details, if there is a cost burden related to design (event pages, banners, etc.), provision and supply of prizes, and prize delivery, or costs incurred during the production of mobile music, the trust contractor (member) shall bear the cost.

• Chapter 4 Other

  • Article 9 (No Duplicate Promotion)

    In principle, duplicate promotion of the same album is not allowed. However, an exception is made for the production of a regular album, such as adding tracks after producing a single.

• Addendum

  These regulations shall enter into force on the date they are passed by the Board of Directors.

Deposit Handling Operating Rules

• Article 1 (Purpose)

  The purpose of these regulations is to stipulate all matters necessary for the receipt and handling of deposits under Article 16 of the Association's Terms of Use.

• Article 2 (Method of Receiving Deposits)

  1. ① In accordance with Article 16 of the Terms of Use, the Association may receive all or part of the deposit from the user in lieu of a guarantee insurance policy, and the cash receipt ratio is as follows:
     
     • 1. 50%: If there is no change or addition to the service and there is no history of overdue royalties. However, this applies when renewing the use agreement with the user.
     • 2. 50% or more: The following shall apply when renewing or initially concluding a use agreement with the user:
       
       • a. If there are frequent changes and additions to the service
       • b. If there is a history of overdue royalties of 1 or more times
       • c. If there is a history of habitual overdue royalties or there is a risk of overdue royalties
       • d. When concluding a use agreement for the first time. However, if the estimated annual royalty to be generated from the user does not exceed 5 million KRW, the deposit may be received in full in cash in consultation with the user within a limit not exceeding 5 million KRW.
  2. ② The reduction or exemption of all or part of the deposit shall apply only to users who fall under the following:
     
     • 1. When receiving an annual royalty for using a small amount of copyrighted works
     • 2. In the case of an overseas corporation
     • 3. If there is no history of overdue payments for 2 years or more after the conclusion of the contract

• Article 3 (Handling of Deposits in Case of Non-payment of Royalties)

  If royalties are overdue during or after the contract period, the Association may, at its option, offset the unpaid royalties (including overdue surcharges) from the deposit already received and return the balance, or return the full amount and claim payment of the unpaid royalties.

• Article 4 (Guarantee Period)

  The deposit (or guarantee insurance) guarantees against default of royalty obligations for up to one year after the conclusion of the contract.

• Article 5 (Renewal of Deposit)

  After the use agreement with the user, upon (automatic) extension of the contract, the effect of the deposit received in cash shall be extended as a subordinate contract of the use agreement. However, the guarantee insurance shall be renewed on an annual basis.

• Article 6 (Return of Deposit)

  The deposit received by the Association in accordance with these detailed rules shall be offset against the unpaid royalties in accordance with Article 3 after the termination of the use agreement, or the full amount shall be returned within 2 weeks.

• Article 7 (Confirmation of Deposit)

  When concluding a use agreement, the contract manager (team) shall notify the accounting manager (team) of this by means of a document, etc., and the accounting manager (team) shall notify this in the same way after confirming the deposit.

Addendum

These regulations shall enter into force on the date they are passed by the Board of Directors.