THE CREATIVE CRISIS: R300 MILLION IN UNCLAIMED ROYALTIES AND THE FIGHT FOR ARTISTS' RIGHTS

 Rabbi Mashabela, Director at Mashabela Attorneys and Shynebright Entertainment

The South African creative sector is facing a major crisis, with over R300 million in unclaimed royalties sitting with collecting agencies.

This staggering amount of money is a result of a systemic problem that has been plaguing the industry for years.

According to Rabbi Mashabela, director at Mashabela Attorneys and Shynebright Entertainment, this issue is a result of a lack of understanding and communication between artists and collecting agencies.

The Copyright Amendment Bill and the Performers' Protection Amendment Bill, which are currently before the Constitutional Court, aim to update South Africa's copyright regime. However, critics argue that these bills contain provisions that could be devastating to the sector's stability. One of the most concerning issues is the inclusion of retrospective clauses, which would allow artists to claim rights or royalties dating back decades.

Mashabela warns that this could amount to unconstitutional deprivation of property and create legal uncertainty. "You cannot rewrite history through law," he explains. "The President Cyril Ramaphosa was correct in flagging this. It creates legal uncertainty and violates the principles of fairness."

The disconnect between artists and collecting agencies is also a major issue. Many artists don't understand how to claim their royalties, and the agencies are failing to bridge the gap. Mashabela emphasizes the importance of financial literacy and legal knowledge for artists, saying that they need to understand their rights and obligations.

"The same big names who owe SARS are the ones who skip financial literacy workshops," says Mashabela. "It's a cycle of self-defeat." Many artists, especially emerging ones in rural and peri-urban areas, lack access to legal advice, financial literacy, or brand management training.

This lack of knowledge and understanding is a major contributor to the crisis facing the creative sector. The creative economy is a significant contributor to South Africa's GDP, and it's essential that the sector is nurtured and protected. The Copyright Amendment Bill and the Performers' Protection Amendment Bill have the potential to either support or stifle the growth of the sector, depending on how they are implemented.

As the Constitutional Court deliberates on the future of these bills, the outcome will have enormous implications for the industry. The court's decision will determine the fate of the creative sector and the livelihoods of thousands of artists.

Financial literacy is crucial for artists to understand their rights and obligations. Many artists don't know how to manage their finances, and this lack of knowledge can lead to financial ruin. Mashabela shares stories of well-known musicians falling into financial trouble, not because they failed as artists, but because they never learned to operate as entrepreneurs.

"You'd be shocked how many don't separate personal and business finances," he says. "They issue invoices without knowing their tax responsibilities, spend company money as if it's personal, and only realise the consequences when SARS or creditors come knocking."

Legal knowledge is also essential for artists to understand their rights and obligations. Many artists don't know how to negotiate contracts or protect their intellectual property. Mashabela emphasizes the importance of legal counsel when signing with labels or publishers.

"The law says you are bound by what's above your signature," he says. "Too often, people sign long-term contracts without reading them or understanding clauses like automatic renewal or royalty splits. Once you're in, you're stuck."

The creative sector needs to come together to address these issues and ensure that artists receive the support and protection they deserve. This includes providing financial literacy and legal training for artists, as well as working to bridge the gap between artists and collecting agencies. By working together, we can build a more sustainable and equitable creative industry.

The Constitutional Court's decision on the Copyright Amendment Bill and the Performers' Protection Amendment Bill will have a significant impact on the future of the creative sector. It's essential that the court considers the potential implications of these bills and makes a decision that supports the growth and development of the sector.

The creative sector is facing a major crisis, with over R300 million in unclaimed royalties sitting with collecting agencies. The Copyright Amendment Bill and the Performers' Protection Amendment Bill have the potential to either support or stifle the growth of the sector, depending on how they are implemented. It's essential that artists have access to financial literacy and legal knowledge to understand their rights and obligations. By working together, we can build a more sustainable and equitable creative industry.