South African Music Performance Rights Association v Foschini Retail Group (Pty) Ltd and others
 2 All SA 40 (SCA)
SUPREME COURT OF APPEAL
30 November 2015
L MPATI P, NZ MHLANTLA, R PILLAY, KGB SWAIN and DH ZONDI JJA
. Editor's Summary . Cases Referred to . Judgment .
Intellectual property Copyright Payment of royalties Tariff of royalties Determination of tariff by Copyright Tribunal
Section 9A read with sections 30(b), 33(3) and 33(5) of the Copyright Act 98 of 1978 Jurisdiction of tribunal established
by absence of agreement between user and owner of copyright All that is required of a claimant is to place evidence
before the tribunal on the issue of whether the claim is wellfounded.
The respondents were a group of retailers whose entitlement to play background music in their stores attracted an
obligation to pay royalties to the appellant ("SAMPRA"). Section 9A(1)(a) of the Copyright Act 98 of 1978 (the "Act")
imposed such obligation, providing as it did that in the absence of an agreement to the contrary no person may
broadcast, cause the transmission of, or play a sound recording without the payment of a royalty to the owner of
the relevant copyright. The amount of the royalty payable ("the tariff") was in terms of section 9A(1)(b) of the Act,
to be determined by agreement between the user of the sound recording, the performer and the owner of the
copyright, or between their representative collecting societies. In the absence of an agreement, section 9A(1)(c) of
the Act provided that the user, performer, or owner could refer the matter to the Copyright Tribunal ("the tribunal"),
or they may agree to refer the matter for arbitration.
Agreement not being reached in this case, the retailers referred the matter to the tribunal for determination. The
tribunal determined that in the circumstances a reasonable tariff lay somewhere between the respective amounts
proposed by the retailers and set by SAMPRA. The tariff awarded exceeded that proposed by the retailers, but was
less than that set by SAMPRA. SAMPRA, accordingly, applied for and was granted leave by the tribunal, to appeal to
this Court against the tariff awarded, as well as the costs order granted in favour of the retailers.
SAMPRA argued on appeal, that the retainers would have to satisfy the tribunal that their claims regarding the
unreasonableness of the tariff set by SAMPRA were wellfounded, and only then would the tribunal be empowered
to determine a reasonable tariff. SAMPRA then submitted that the retailers did not adduce sufficient evidence in
support of their claims regarding the unreasonableness of the tariff, and that the appeal should be upheld, the tariff
determined by the tribunal be set aside and replaced by the tariff set by SAMPRA. In response, the retailers argued
that all that was necessary to activate the tribunal's jurisdiction was the absence of agreement on the amount of
the tariff between the retailers and SAMPRA.
Page 41 of  2 All SA 40 (SCA)
Held In terms of section 9A, all that was required before the matter could be referred to the tribunal was the
absence of an agreement between the user (being the retailers) and SAMPRA, as "the owner", as to the amount of
any royalty payable to the owner of the relevant copyright. Once the absence of an agreement was established,
the jurisdiction of the tribunal to determine the dispute in terms of section 30, read with section 33(3) and 33(5), of
the Act was established.
Section 33(5) provides that the tribunal shall make an order declaring that the applicant is entitled to a licence on
such terms and conditions and subject to the payment of such charges, as the tribunal may determine to be
reasonable in the circumstances, if it is satisfied that the claim of the applicant is wellfounded. For the tribunal to
be satisfied that the claim of the applicant is wellfounded, it must have a foundation in fact or reason, based on
good grounds or evidence. Consequently, all that is required of a claimant is to place evidence before the tribunal
on the issue of whether the claim is wellfounded. That involves an evidentiary burden rather than a legal burden of
The Court then turned to consider whether sufficient evidence was placed before the tribunal for it to be satisfied
that the claim by the retailers was wellfounded in that the tariff proposed by SAMPRA was unreasonable. The Court
had regard to expert evidence, and found that SAMPRA had led no expert evidence to rebut the evidence of the
retailers' expert that the tariff set by SAMPRA was excessive and therefore unreasonable. The Court also found no
basis for the tariff set by the tribunal. It found the tariff proposed by the retailers to be fair to SAMPRA and the
retailers and reasonable in the circumstances of this case. That conclusion led to the upholding of the appeal.
For Intellectual property see:
LAWSA Second Edition Replacement Volume Vol 29 (paras 1294)
Burrell TD Burrells South African Patent and Design Law 3ed Durban LexisNexis 1999