Control Mechanisms for CRM Systems and Competition Law

There are basically two different mechanisms to control collective management organizations (CMOs), namely the general competition-law approach and the sector-specific regulation approach. This chapter explains the features of copyright management (CRM) systems in general and discusses up- and downsides of both approaches. In conclusion it suggests a primary focus on sector-specific regulation. This approach not only takes into account the particularities of two-sided markets in which CMOs act as intermediaries, but also allows the balancing of non-economic values and interests which are among the objectives of CMOs. Sector-specific regulation is further capable of addressing governance issues of CMOs; above all, it promotes transparency for both right holders and users by providing ex ante guidance. General competition law, in contrast, applies ex post and is particularly likely to become a last resort to control CMOs.