Update on PPCA Case
By Les Mills Australia Pacific
Published: September 26, 2009

Just to recap, PPCA's claim was to have the tariff increased from its current level of 97 cents per fitness class to $4.54 per member per month and $0.99 per visit for a casual attendee at a fitness centre. The proposed tariff would be payable by the club owner on every member of the club regardless of whether that member participated in a fitness class or not. This would represent a significant increase from the current level. The Copyright Tribunal heard the case over a 5 week period in April and June.

Closing submissions from PPCA, Fitness Australia and the ACCC were heard in the Copyright Tribunal at the beginning of July. Fitness Australia's closing submissions included a significant challenge to the economic modelling and analysis conducted by PPCA to arrive at their proposed per member per month licence scheme for the use of music in fitness classes and the proposed tariff of $4.54 per member per month. The ACCC closing submissions largely supported Fitness Australia's position.

Fitness Australia's legal team remain confident of a favourable outcome in this case and that any change to the current PPCA tariff scheme of 97 cents per fitness class will be kept to a minimum. Les Mills Asia Pacific agrees with that assessment. Furthermore, in the unlikely event that there was a significant increase to the current PPCA tariff, Les Mills would provide alternative high quality cover music which would not be subject to the PPCA tariff. For your information, over 50% of the music on Les Mills last quarterly release for its 8 programs was non PPCA protected.

Notwithstanding the above, and because of the complexity of the case and the volume of evidence produced by all three parties, the Tribunal has indicated that a decision is unlikely to be made until the first half of 2010. Therefore, the current PPCA tariff scheme of 97 cents per fitness class will be in place for some months yet within the fitness industry and it remains BUSINESS AS USUAL.

We will of course keep you updated on any further developments. In the meantime, if you have any queries around this update please do not hesitate to contact us ask@lesmills.com.au