Developments of Note

Recording Industry Makes New Royalty Deal with Noncommercial Webcasters

On June 3, the Recording Industry Association of America (RIAA) announced that it reached a deal with noncommercial Webcasters, such as college, nonprofit and religious radio stations, on the royalty rates that must be paid to broadcast copyrighted music over the Internet. The agreement follows similar deals that the recording industry struck earlier this year with large and small commercial Webcasters, and as with those deals, many questions about fairness and profitability remain.

Under the terms of the agreement, noncommercial Webcasters that average less than 200 listeners an hour must pay between $250 and $500 as a flat annual fee for Webcasting rights, and stations exceeding that audience must pay a small per song fee for each listener above 200.

Six members of the first graduating class of Concord Law School passed the California bar in May, making them the first lawyers with Internet-based degrees. The online-only Concord Law School ' with its streamed audio and video lectures and e-mail or chat room interactions ' is not approved by the American Bar Association, but it is accredited by the California Bureau of Private Post-Secondary and Vocational Education, making its graduates eligible to take the California bar and practice law in that state no matter where their virtual education occurred. Concord was launched in 1998 by Kaplan, the test preparation company, and now has an enrollment of nearly 1,200 students.

Effective July 1, the EU began collecting value-added tax (VAT) on 'digital sales' ' including downloads, ISP subscriptions and online auction transactions ' made by U.S. and other non-European companies. For years, U.S. e-commerce companies have been exempt from this tax while their European counterparts have not. Now, U.S. companies face a choice: either set up a centralized office in one EU country and pay that country's tax rate, or operate without a European headquarters and pay the tax rate of the country where the customer lives ' ranging from a low of 12% in Madiera to a high of 25% in Sweden.

In response to the change, America Online announced that it would establish a new European headquarters in Luxembourg, and eBay and Amazon.com announced modifications to their businesses as well.

Developments of Note was written by Julian S. Millstein, Edward A. Pisacreta and Jeffrey D. Neuburger, partners in the New York office of Brown Raysman Millstein Felder & Steiner LLP.

Recording Industry Makes New Royalty Deal with Noncommercial Webcasters

On June 3, the Recording Industry Association of America (RIAA) announced that it reached a deal with noncommercial Webcasters, such as college, nonprofit and religious radio stations, on the royalty rates that must be paid to broadcast copyrighted music over the Internet. The agreement follows similar deals that the recording industry struck earlier this year with large and small commercial Webcasters, and as with those deals, many questions about fairness and profitability remain.

Under the terms of the agreement, noncommercial Webcasters that average less than 200 listeners an hour must pay between $250 and $500 as a flat annual fee for Webcasting rights, and stations exceeding that audience must pay a small per song fee for each listener above 200.

Six members of the first graduating class of Concord Law School passed the California bar in May, making them the first lawyers with Internet-based degrees. The online-only Concord Law School ' with its streamed audio and video lectures and e-mail or chat room interactions ' is not approved by the American Bar Association, but it is accredited by the California Bureau of Private Post-Secondary and Vocational Education, making its graduates eligible to take the California bar and practice law in that state no matter where their virtual education occurred. Concord was launched in 1998 by Kaplan, the test preparation company, and now has an enrollment of nearly 1,200 students.

Effective July 1, the EU began collecting value-added tax (VAT) on 'digital sales' ' including downloads, ISP subscriptions and online auction transactions ' made by U.S. and other non-European companies. For years, U.S. e-commerce companies have been exempt from this tax while their European counterparts have not. Now, U.S. companies face a choice: either set up a centralized office in one EU country and pay that country's tax rate, or operate without a European headquarters and pay the tax rate of the country where the customer lives ' ranging from a low of 12% in Madiera to a high of 25% in Sweden.

In response to the change, America Online announced that it would establish a new European headquarters in Luxembourg, and eBay and Amazon.com announced modifications to their businesses as well.

Developments of Note was written by Julian S. Millstein, Edward A. Pisacreta and Jeffrey D. Neuburger, partners in the New York office of Brown Raysman Millstein Felder & Steiner LLP.