Photo/IllutrationShunichi Tokura, chair of the Asia-Pacific Music Creators Alliance, fourth from right, speaks at a news conference demanding a rise in film music screening fees in Japan in Tokyo’s Shinjuku Ward on Nov. 8. (Erina Ito)

The nation's largest music copyright body has announced plans to change the fee on foreign films screened in Japan from a fixed basis to a percentage of the box-office revenues, which has theater owners warning of dire consequences.

The Japanese Society for Rights of Authors, Composers and Publishers (JASRAC) is demanding film distributors to pay 1 to 2 percent of revenues from foreign films as royalties for film music screening rights from April 2018. Under the current system, film distributing companies pay a flat fee of 180,000 yen ($1,580) per film to JASRAC.

The proposal is supported by other Asian music copyright bodies and a number of renowned composers, including Ryuichi Sakamoto, while cinema operators and distributors are furiously opposed to the plan.

Japan’s copyright laws require permission from composers and lyric authors of songs used in it to screen a film. Based on this rules, JASRAC has been collecting fees for film music screening rights from the film industry.

For Japanese films, the film music rights royalty is calculated based on the number of screening theaters.

For foreign films, 180,000 yen per film is paid from distribution companies, based on a contract between JASRAC and the Japan Association of Theater Owners (JATO). The fixed price does not change even if a film becomes a box-office hit, and however much cinemas and distributors make from it.

Because of the contracts, JASRAC currently receives only around 200 million yen from film music screening rights annually, including those of Japanese films.

In many European countries, fees for film music screening rights are set between 1 to 6 percent, and in France, Britain, Germany and Italy, royalties collected from the rights total between 1.3 to 2.3 billion yen per annum.

JASRAC has been negotiating with JATO for a rule change since 2011, and announced the plan on Nov. 8 to change the current rule for foreign films to a new percentage-basis on screening revenue.

JASRAC is aiming to set the rate at between 1 to 2 percent of revenue from screening in Japan, similar to that in European countries.

If achieved, royalties collected by JASRAC will significantly increase. Under the proposed rule, JASRAC could have collected, for example, 250 million yen to 500 million yen from Walt Disney’s “Frozen” alone that opened in 2014 in Japan and became the year’s highest-grossing film.

According to JASRAC, many music copyright societies in Asia, including China, Thailand and India, have been unable to collect fees for film music screening rights.

On Nov. 6, the Asia-Pacific Music Creators Alliance (APMA) that consists of music copyrights collection bodies of Asia, including JASRAC, held a general meeting in Tokyo, and voted to issue the Tokyo Declaration. The declaration, officially announced on Nov. 8, said, "While films constitute a major part of the vast entertainment industry, film music creators are not remunerated fairly in the Asia-Pacific countries for the public showing of films that include their music.

"Film music creators should be remunerated at a level where they too can enjoy the success of a movie."

Shunichi Tokura, a composer and the chair of APMA, appealed at the Nov. 8 news conference that Japanese film industry lacks “unwritten rules to pay the rewards that matches the job it did,” and that “takes away (musicians’) incentives.”

Oscar winning composer Ryuichi Sakamoto, who has produced many film scores for foreign films, including “The Revenant" (2015), sent a comment in support to the news conference.

“I am hoping Japan will take the leadership to protect the financial means of music creators,” Sakamoto said in the message.

On the other hand, film industries are reeling from the proposal. A person who works in the industry called the proposal “reckless.”

In response to JASRAC’s suggestion, JATO held discussions with film distributors and sent a formal letter to JASRAC dated Nov. 7. In it, JATO wrote it “absolutely cannot accept” the proposed new rules, citing it would “create great confusion to our businesses at a practical level.”

At the same time, JATO suggested an alternative plan to mitigate the fee increase on film screening rights. JATO’s plan includes setting up a three-tiered, fixed-fee system that changes depends on the number of theaters showing a film.

A person who works for a cinema complex said, “(JASRAC’s proposal) does not take the situation cinemas in Japan face, such as high wages and the high property rental cost. Some cinemas would go under should it take effect.”

Some operators consider that a rise in movie ticket prices would be inevitable if the change takes effect.

(This article was written by Yasukazu Akada, Noriki Ishitobi, senior staff writer, and Erina Ito.)