In America, the industry of music publishing has its roots in New York's Tin Pan Alley. Since that time, it has grown into a worldwide industry. But the simple truth is, almost anyone can form a basic music publishing company with a little planning.
1
Form a music publishing company
A business entity may take one of many forms: the most prominent are sole proprietorship, corporation (Subchapter C or S), partnership, limited liability company. That decision will, in part at least, determine what type of documentation you need to submit to the state in which your company’s principal place of business is located. One factor that weigh in favor of forming either a corporation or limited liability company is that these business entities offer a form of protection against personal liability (i.e., your house, car and other personal possessions)
2
Check with your state to see what steps are required
In most states, the Secretary of State is the department that handles the formation of business entities or the registration of fictitious business names. If you choose to be a sole practitioner or partnership, chances are there is very little the state will require, other than perhaps the filing of a “D/B/A” or fictitious name form and a business license. On the other hand, if you select either a corporation or a limited liability company, you will be required to pay an annual filing fee and submit a form to the Secretary of State who will then assign you a control number. You should probably seek the services of an attorney to draft and file the appropriate documentation and advise you as to the business governance.
3
File with the IRS for an EIN and file any additional local paperwork
Once you’ve met all the state requirements, you should obtain an employee identification number. This number is required to open a bank account in the name of the business entity. In addition, other filings may be required in your particular locality: in addition to a possible business license, as mentioned earlier, you may also be required to register the corporation or limited liability company with the Register of Deeds in the county in which you will be conducting business.
4
Register with the Performance Rights Organizations
This step is unique to business entities involving music publishing. In order to “publish” music, you should register with the performance rights organizations (PRO’s) ASCAP, BMI and SESAC, at least for starters. Foreign registration may be required in certain circumstance, but that is a topic for another guide. For starters, just register with the three U.S. performance rights organizations. Each organization has a website (identified below) which contains all necessary applications and explanations. Basically, you will need to have a work that you anticipate will be performed in the near future and may be ask to identify that work. You will need to select three names for each PRO in order of preference. These should be different for each organization. Then, submit the application along with the fee.
5
Start building your catalog
A music publisher’s catalog is its major asset. Some catalogs are valued at billions of dollars, depending on numerous rating factors. As a start up company, your goal will be to enter into agreements with songwriters in order to build your catalog. One type of agreement used to accomplish this is know as an Exclusive Songwriting Agreement, in which you as the publisher pay the songwriter a salary to produce a certain number of songs per year, the copyright in which is assigned to you. Another type of agreement is the Single Song Agreement, which basically accomplishes the same feat on a song by song basis. You might also consider purchasing an existing catalog, which is a much faster way to build a repertoire.
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