PHILIPPINES Trends and Developments Contributed by: Patricia A O Bunye, Anica Angela G Gomez, Angel Rae N Balbin and Bianca Marie J Angela M Rañola, Cruz Marcelo & Tenefrancia
Here, the Court held that the “pre-listening function” constitutes communication to the public, but not as a public performance. The Supreme Court then found that Wolfpac’s agreements with composers only authorised the conversion of musical works into down - loadable ringtones and their commercial distribution. These agreements did not explicitly include authori - sation to stream free 20-second samples. Because all unassigned rights remained reserved to the com - posers, Wolfpac’s use of the pre-listening function exceeded the scope of its licence and infringed upon the copyright owner’s right of communication to the public. Nevertheless, the Supreme Court ruled that the pre-listening function qualified as fair use, shielding Wolfpac from liability. This case is particularly important as creative content increasingly circulates through digital spaces. The Supreme Court’s approach balances acknowledg - ing developments caused by innovative digital tech - nologies while preserving the fundamental legislative policy of incentivising creativity.
The foregoing decisions highlight valuable consid - erations for individuals and entities who wish to do business in the Philippines by demonstrating the importance of ensuring that the necessary licences are obtained prior to using any copyrighted musical works. By properly licensing copyrighted works, fran - chise businesses can prevent any potential actions against them on the ground of copyright infringement. For instance, in the case of franchise agreements, warranty clauses regarding the use only of licensed intellectual property, which includes copyright, must be stipulated for the benefit of both the franchisor and the franchisee. This would ensure that only licensed copyrighted works are used for the franchise busi - ness, and any violation of such warranty would con - stitute a breach of the agreement. Additionally, when licensing copyrighted works, the party seeking to obtain a licence must ensure that all its intended uses of the work are sufficiently covered by the licence. Otherwise, any use exceeding the scope of the licence may be considered as copyright infringement, unless it falls under exceptions such as fair use.
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