Título VIII. Sociedades de gestión colectiva

Holders of copyright and related rights may establish nonprofit civil associations so that, once the respective registration has been obtained, they may request their authorization as collective management societies, for the defense and administration of the economic rights recognized by the present law. These associations shall be governed by the general provisions established in the Civil Code and the special provisions contained in this law and its regulation, as well as as provided in their bylaws, and shall be subject to the inspection and oversight of the State, through the Intellectual Property Register.

Associations that request their authorization as collective management societies may only have as their purposes those provided for in this law, without prejudice to their complementary activities of a cultural and welfare nature, and may not engage in any political or religious activity.

The authorization of a nonprofit association to operate as a collective management society may be granted by the Intellectual Property Registry when compliance with the following requirements is established:

a)That the association has been constituted and has obtained its legal personality in accordance with the provisions established for that purpose in Article 113 of this Law;

b)That it has the basic human, technical, financial and material resources for the fulfillment of its purposes;

c)That the association proves that it is comprised in its majority of members who are Guatemalans by origin or foreigners domiciled in Guatemala, who are holders of rights in the same category of works or productions;

d)That the members of the association are recognized as having an appropriate right of participation in the decisions of the entity;

e)That the distribution rules, once administrative expenses have been deducted up to the maximum percentage provided for in the bylaws, which in any event may not exceed thirty percent, guarantee an equitable distribution among the holders of the rights, proportionally to the actual use of the works, performances or artistic executions, or phonograms, as the case may be;

f)That it has, at a minimum, membership, tariff and distribution regulations;

g)That it proves the effectiveness of the management abroad or of the foreign repertoire in the national territory, by means of elements ensuring the conclusion of reciprocal representation contracts with associations or societies with the same purposes operating abroad. The Intellectual Property Registry shall carry out the pertinent evaluation; and

h)Any other information that in the judgment of the Intellectual Property Registry is necessary.

For the defense of the patrimonial rights of their associates, collective management societies are considered mandataries of the latter by the mere act of affiliation thereto.

Except as otherwise agreed, the powers of collective management societies are the following:

a)To represent their members before the judicial and administrative authorities of the country, in all matters of general and particular interest to them, unless the members decide to exercise on their own behalf the actions corresponding to the violation of their rights;

b)To negotiate with users the conditions of the authorizations for the performance of acts comprised in the rights they administer and the corresponding remuneration, and to grant such authorizations;

c)To collect and distribute to their members the remuneration derived from the rights to which they are entitled. For the exercise of this power the associations shall be considered mandataries of their associates by the mere act of affiliation thereto;

d)To enter into agreements with foreign collective management societies of the same activity or management;

e)To represent in the country the foreign societies with which they have a representation contract, before the judicial and administrative authorities, in all matters of interest to them, being empowered to appear at trial on their behalf;

f)To watch over the safeguarding of the national intellectual and artistic tradition; and

g)Such others as their statutes may indicate.

Once authorized, collective management societies shall have standing to exercise the rights that are the subject of their management and to enforce them in all kinds of administrative and judicial proceedings, requiring no other title and evidence than their own bylaws. Absent evidence to the contrary, it shall be presumed that the society holds representation of the rights claimed.

The bylaws of collective management societies shall state:

a)The name of the entity;

b)The purpose or objectives, with an indication of the rights that may be administered;

c)The classes of right holders covered by the management, and the participation of each category of holders in the direction or administration of the entity;

d)The conditions for the acquisition and loss of associate status;

e)The rights of the associates and represented persons;

f)The obligations of the associates and represented persons and the disciplinary regime to which they are subject;

g)The Governing bodies and their respective powers;

h)The procedure for the election of the authorities;

i)The initial patrimony and the projected economic resources;

j)The rules for the approval of the collection and distribution rules;

k)The regime for control and oversight of the economic and financial management of the society;

l)The time for submission of the balance sheet and the report on the activities carried out annually, as well as the procedure for verification of the balance sheet and its documentation; and

m)The destination of the patrimony of the society in case of dissolution.

Collective management societies shall admit as members the holders of rights protected by this law who so request and who duly prove their status as such. The bylaws shall determine the form and conditions of admission and withdrawal of admission.

Foreign members whose rights are administered by a collective management society, directly or on the basis of agreements with similar foreign societies, shall enjoy the same treatment as members who are nationals or who have their residence in the country.

Collective management societies shall always be obligated to accept the administration of the rights of the association.

Members may not, in any case, be expelled. The bylaws shall determine the cases in which suspension of membership rights is appropriate. To approve the suspension, seventy-five percent (75%) of the votes represented at the session of the General Assembly in which the resolution is adopted shall be required. The suspension shall not entail deprivation or withholding of economic rights or receipts.

The collective management society shall have, as a minimum, the following bodies: the General Assembly, a Board of Directors and a Supervisory Committee. The collective management society shall be obliged to have an external audit. It shall also have a General Director, who shall be appointed by the Board of Directors. Whoever presides over the Board of Directors and the General Director shall have legal representation of the entity, without prejudice to other offices which by provision of the bylaws also have legal representation of the entity.

Every collective management society shall record in the Register of Intellectual Property the regulations it issues.

The General Assembly is the supreme body of the entity and shall appoint the members of the other bodies. The General Assembly is responsible for, among others:

a)To approve or reject the financial statements and annual report of the entity;

b)To approve or reject the report of the Supervisory Commission;

c)To designate the external audit;

d)To approve the amendment of the Bylaws; and

e)Any other powers established by its bylaws, insofar as they do not contravene the provisions of this law.

Without prejudice to the oversight rules established in the bylaws, the financial statements and the accounting records and documentation of the entity shall be submitted to the analysis and opinion of the external audit. The report of the external audit, the financial statements and the accounting records and documentation shall be made available to the members fifteen days in advance of the holding of the respective General Assembly. The call for the holding of the General Assembly shall be made known to the members by means of notices published at least twice in the official gazette and in another of those of greatest circulation in the country, with no less than fifteen days in advance of the date of its holding.

The decisions lawfully adopted by the General Assembly are binding even for members who were not present or who voted against, except for the right to challenge them judicially when they are contrary to public order, to this law and its regulations, the bylaws and regulations of the collective management society. The challenge by judicial means shall be exercised through the procedure of incidents within the fifteen days following the date on which the general assembly took place.

Approval of the regulations and of the annual budget shall be a power of the General Assembly upon proposal of the Board of Directors.

Persons who form part of the governing bodies of a collective management society shall not serve in similar bodies of another entity related to this subject matter.

The following persons shall not be principal or alternate members of the Board of Directors, of the Oversight Committee or General Director of a collective management society:

a)Relatives of each other, up to the fourth degree of consanguinity and second of affinity;

b)Spouses or those who are united in a de facto union;

c)Artistic directors, entrepreneurs, owners, partners, representatives or attorneys serving debtor entities of the collective management society or that have pending litigation with it; and

d)Relatives up to the fourth degree of consanguinity, or second of affinity, spouses or those who are united in a de facto union with the public officials or personnel of the Register of Intellectual Property as established in the regulation of this law.

The members of the Board of Directors, of the Oversight Committee and the General Director, upon assuming their positions and annually, within the first fifteen days of the month of January, shall submit to the Register of Intellectual Property a sworn declaration contained in a notarial record that they are not covered by any of the incompatibilities referred to in this law.

Collective management societies are obligated to supply to their members and represented persons detailed periodic information on all activities of the organization that may be of interest to the exercise of their rights. Similar information must be sent to the foreign associations or societies with which they maintain a representation contract.

They are likewise obligated to provide to the Intellectual Property Register all information it may require, as well as to facilitate its access to books and documents in order to verify compliance with legal and statutory rules.

Collective management societies are empowered to collect and distribute the remunerations corresponding to the use of the works and sound recordings whose administration has been entrusted to them, being empowered to establish the tariffs corresponding for the use thereof.

The distribution of the collected rights shall be made equitably among the holders of the administered rights, as approved in the bylaws. The following principles shall apply to the distribution of the collected rights:

a)Distribution shall be made proportionally to the use of the works, performances or productions;

b)The distribution of rights corresponding to foreigners shall be made on the same terms established for the distribution of rights corresponding to Guatemalans;

c)The right to claim settlement of undistributed rights shall prescribe in five years, counted from the day following the date on which distribution is due. Therefore, collected rights not distributed within the time limit of 5 years, due to lack of identification or documentation of the works or productions, shall be distributed proportionally to the use of the works, performances or productions, duly identified or documented, corresponding to the same collection period.

No remuneration collected by a collective management society may be allocated to any purpose other than distribution to its members, once the respective administrative expenses have been deducted, except upon express authorization from the General Assembly of Associates. The directors of the society shall be jointly and severally liable for the violation of this provision.

To permit the holding of public shows and public auditions of protected works and phonograms, the governance authorities and any other competent authority shall verify that authorization has been obtained from the holders of the right and from the collective management entities, as applicable, and that payment of the remuneration set in the corresponding tariffs has been made.