CIC Association

Serving Community Enterprise

Hi all,

I'm setting up a CIC in the area of community music and I have a question regarding intellectual property and the asset lock.

It might be simpler to outline a scenario and just get some feedback as to whether my understanding is correct:

My new CIC commissions a composer, for a fee, to produce a new piece of music which the CIC publishes (may CIC is a publisher of community music). Normally royalties are split between publisher and composer 50/50 (and it is in fact illegal for a composer to receive less than 50% of ongoing royalties). Therefore I would assume that should any royalties be generated, only the 50% publishing share would become income for the CIC and it's just this 'publishing' share of the 'product' that forms part of the CIC's asset. This seems pretty clear to me, but would be interested in any views or feedback.

Royalties are distributed by the PRS (performing rights society) and my CIC would only ever receive the 50% publisher share from them - so this standard arrangement shouldn't conflict with a CIC, right?

Thanks for any insights.


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Replies to This Discussion

Hi Mike

Correct, always good to double check any doubts, best of luck


Thanks, John.

That would seem correct to me. The difference, as a CIC, being that the assets (intellectual property in the music) must be used principally for the benefit of the community, and cannot be transfered for less than full consideration (i.e. sold at less than market value).

That's interesting.  Your reminder about 'full consideration' raises another point.  As part of the rationale for my CIC being different to a commercial company, I was intending to publish the essential elements of our projects in such a way that community groups could download and use them free of charge.  Does this break the rule of 'full consideration'?  Surely this FOC element is an important part of teh benefit to the community.  I'm guessing that as long as there is a distinction between usage (free for community use, chargeable at full rates for commercial use), then this is OK?

Hello Mike

Sorry for the confusion. This rule does not apply to the transfer of assets made for the benefit of the community (or the transfer of assets into certain an asset-locked bodies).



Thanks James, that makes perfect sense.



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