Future of Music Royalties in Indonesia

SKC Law recently sponsored and participated in the AKHKI-HKTDC Seminar “Menyambut RUU Hak Cipta: Peluang, Tantangan, dan Pelindungan Hak Cipta dalam Musik,” held in Jakarta. The event brought together leading IP practitioners, regulators, and industry stakeholders to address the evolving landscape of copyright management, royalty distribution, and international collaboration.

The seminar, organized by the Indonesian Intellectual Property Attorneys Association (AKHKI) in partnership with the Hong Kong Trade Development Council (HKTDC), focused on the upcoming revision of Indonesia’s Copyright Law (RUU Hak Cipta) and its impact on music copyright governance. The event featured keynote speeches, panel discussions, and the signing of a Memorandum of Understanding (MoU) to foster cross-border collaboration and promote best practices in royalty management.

Attendees included representatives from law firms, regulators (DJKI, Kemenkumham), collective management organizations (LMKN, LMK), music industry leaders, and academic institutions. The seminar’s multi-stakeholder format enabled direct dialogue between policymakers, practitioners, and users of copyrighted works.

SKC Law’s was not only a sponsor – representatives from our team also contributed to developing the event program. Our Co-Founder, Nidya Kalangie, served as the event’s Vice Leader, supported by Junior Associates Clarissa Aurelie and Hardiana Clarissa, who helped organize the overall program and drafted the Terms of Reference and minutes of the event, keys document for the event’s execution.

Summary of Discussions

Bapak Prof. Dr. H. Ahmad M. Ramli, a distinguished professor from UNPAD and founder of LMKN, emphasized the dual nature of copyright in music – moral rights, which are inherently tied to creators and performers, and economic rights, which can be transferred. He outlined four types of music royalties: mechanical, performing, synchronization, and print. The role of LMK (Collective Management Organizations) is to manage licensing, while LMKN supervises and audits these entities to ensure legal certainty and creator protection. Internationally, countries like Singapore and the UK have adopted blanket licensing systems, while Sweden leads in licensing AI-generated music. Prof. Ramli stressed that AI training using music must fairly compensate creators, balancing technological advancement with human rights.

Bapak Mohammad Iqbal Taufik from the Directorate of Copyright & Industrial Design presented the three pillars of copyright management: regulation, law enforcement, and commercialization. He referenced key regulations including Law No. 28/2014 and Government Regulation No. 56/2021, alongside ministerial decrees on royalty tariffs. He clarified that all commercial uses of music require royalty payments, though SMEs may be exempt upon verification. The blanket license system applies universally, covering both analog and digital formats. Upcoming revisions to the copyright law aim to reinforce moral and economic rights, enhance digital enforcement, safeguard cultural expressions, and address AI-related challenges.

Bapak Ari Juliano Gema of AKHKI reiterated that copyright is reserved for human creators and hinges on originality rather than novelty. He mapped out the music industry’s key stakeholders – creators, performers, producers, and publishers – and highlighted the three main economic rights: mechanical, synchronization, and performing.

Panel Discussions: Practice, Challenges, and the Road Ahead

Bapak Adi Adrian from WAMI discussed the uniqueness of Indonesia’s royalty management system, which involves state oversight through LMKN, unlike most countries where management is fully private. After a decade of implementation, he recommended transitioning back to private management with robust transparency and oversight. He also emphasized the importance of international cooperation with organizations such as APRA (Australia), ASCAP (USA), KOMCA (Korea), and MACP (Malaysia) to facilitate cross-border royalty collection. Royalties are distributed three times annually, supported by independent audits and a blanket license system.

Bapak Marcell Siahaan of LMKN shared updates on the organization’s digital transformation efforts. LMKN is developing the “Inspiration” platform to centralize and streamline royalty collection and distribution in real time. Targets for 2025 include launching the digital system, conducting public audits, improving metadata accuracy, and consolidating LMKs. He outlined the collaborative roles of LMKN as a clearing house, LMK as the distributor, DJKI as the administrative authority, and AKHKI as the legal education provider.

Why It Matters

This seminar directly addressed the landscape for intellectual property (IP) in Indonesia – a market with increasing global relevance. The seminar clarified new compliance requirements, royalty management systems, and digital transformation strategies, helping to reduce legal risks and adapt to international best practices.

The event fostered cross-border collaboration (e.g., the AKHKI-HKTDC MoU), enabling easier enforcement of IP rights and access to local expertise. Local companies and law firms gained actionable insights into regulatory changes, technology adoption, and practical compliance, supporting ease of doing business and opening doors to global networks.

Strategic Insights

For clients, the copyright bill presents both challenges and opportunities. Key implications include:

SKC Law is recognized for its IP expertise and ease of doing business. If you require advisory, enforcement, or collaboration on intellectual property matters in Indonesia, contact our team at enquiries@skclaw.id.

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