In a rare case involving the so-called ‘apolidi’ (rightsholders who are not affiliated with any collecting society and manage their rights directly), the Court of Milan recently delivered a significant ruling[1], finding that collecting societies cannot charge fees for managing and collecting related rights in the absence of a mandate.
This article analyses the Court of Milan’s reasoning and explores its potential implications for the future of collective rights management in Italy.
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Background of the case
Tattica S.r.l., a phonogram production company in which famous Italian artist Renato Zero owns a 75% stake, sued SCF S.r.l., an Italian collecting society that manages related rights of performers and phonogram producers.
Tattica claimed that SCF had unlawfully collected remuneration for the exploitation of their related rights without ever being granted a written mandate to do so by Tattica, and even against their will. According to Tattica, they had never authorized SCF – or any other collecting society – to act on their behalf as they had always managed their rights autonomously. Tattica claimed that SCF had then unlawfully withheld part of the remuneration as consideration for their intermediation services. Tattica managed to recover some of the remuneration after making several formal requests to SCF, but SCF withheld a unilaterally determined intermediation fee of 19% of the collected amounts.
In response, SCF argued that their conduct was both lawful and even beneficial to Tattica. Firstly, SCF had never prevented Tattica from managing their rights independently. Furthermore, while Tattica had never granted them a mandate, SCF maintained that their intermediation was consistent with an alleged “industry practice” whereby the main collecting societies collect royalties on behalf of apolidi rightsholders too. Finally, SCF argued that Tattica had in fact benefited from their intermediation, thereby legitimizing such activity. Indeed, SCF’s negotiations enabled Tattica to exploit their catalog under more favorable licensing conditions and with user associations that Tattica could not have secured alone. SCF therefore claimed that it had lawfully retained part of the remuneration collected in consideration for its intermediation activities.
Notably, to support their argument that they were entitled to collect on behalf of non-associated rightsholders, SCF invoked Article of 12 Directive 2019/790/EU (on copyright and related rights in the digital single market) on extended collective licenses, as transposed by Article 180-ter Law No. 633/1941 (“Italian Copyright Law”). This national provision allows the three most representative collecting societies to enter into licensing agreements (for certain rights) that also apply to rightholders who did not grant them a mandate.
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The Reasoning of the court
First, the Court excluded the applicability of Article 180-ter of the Italian Copyright Law on extended collective licenses on the basis that the provision only applies “to works and other materials protected by national legislation on copyright and related rights in force on June 7, 2021”.. However, the claims concerned rights accrued prior to that date. Consequently, the Court did not assess the lawfulness of SCF’s conduct against that provision.
Instead, the Court referred to Sections 2028 and 2031 Italian Civil Code, which govern the negotiorum gestio (i.e., a form of spontaneous voluntary agency in which an intervener acts on behalf of and for the benefit of a principal without their prior consent). The Court found that SCF’s conduct could indeed be classified as a form of voluntary intervention in Tattica’s business.
In reconstructing the applicable framework, the Court clarified that, for the negotiorum gestio to apply, it is not necessary for the principal to be materially unable to act; it is sufficient that the principal does not expressly or tacitly object to the intervenor’s involvement. The Court thus examined whether Tattica had objected to SCF’s activities and found that they had not. Tattica did not contest SCF’s activities until three years after becoming aware of them, which gave rise to a legitimate expectation by SCF that they could indeed undertake and continue to manage Tattica’s rights.
Nevertheless, SCF’s de facto activity did not entitle them to receive any remuneration. According to Section 2031 of the Italian Civil Code, if the negotiorum gestio has been conducted usefully, the principal is only required to reimburse the intervenor for the necessary expenses incurred; no remuneration is due to the third party for the management itself. The Court stated that recognizing such a right would undermine the spontaneous and altruistic nature of the negotiorum gestio, encouraging “opportunistic” behaviors, i.e., interference motivated by the prospect of personal economic gain.
SCF argued that Tattica’s implicit acceptance of their conduct amounted to ratification and that this would produce the effects of a mandate, thereby legitimizing SCF’s intermediation and entitling them to retain the 19% commission fee. The Court rejected this argument, too.
Consequently, the Court of Milan ordered SCF to reimburse Tattica in full for the remuneration collected without a mandate and pay back the amount unlawfully retained as commission fees, totaling at EUR145,953.30 (plus interest).
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Conclusions
The decision under review offers an interesting perspective on a widely debated issue with few case precedents: the scope, limitations, and consequences of intermediation activities carried out by collecting societies on behalf of apolidi. If rightsholders are aware of such activities but do not oppose them, the Court construes this relationship as negotiorum gestio, whereby a person spontaneously performs legal acts in the interest of a third party, without any legal or contractual obligation to do so. Collecting societies are therefore not entitled to any compensation (at most, they could be reimbursed for out-of-pocket expenses if incurred and proven). This approach to the relationship is not entirely new and has already been suggested by some Italian scholars.
However, it should be noted that the Court’s decision solely concerns the relationship between the collecting society and the third party in whose interest they acted, i.e., the rightsholder. This is only natural, given that the claims here concerned a very specific aspect – the recovery of the fees wrongfully withheld by the collecting society. Therefore, the Court did not assess the lawfulness of collecting remuneration on behalf of apolidi per se, particularly with regard to users. In other words, the decision does not address the question of whether the collecting society was entitled to require users to pay the remuneration for non-mandating rightsholders. In the case in comment, this was not a question submitted to the Court and was not factually relevant, given that the remuneration had been paid.
The decision therefore raises two questions. Firstly, what if users had requested legal justification from SCF for their entitlement to collect for Tattica? Absent a mandate and given that Article 180-ter does not apply to the facts in dispute, the answer would likely have been negative. Now, for the first time, that same provision entitles (some) collecting societies to enter into agreements also on behalf of non-mandating rightsholders. However, could that relationship still be framed as negotiorum gestio? According to some scholars, the answer could be yes. While the decision does not apply to or provide insight into the application of Article 180-ter, it may therefore still be relevant in clarifying the legal boundaries of collective rights management and reinforcing the principle of consent when it comes to collecting fees for copyright and related rights. The consequences of this classification would be significant, as the “management of third-party affairs” would mean that collecting societies would not be entitled to any remuneration if they collect for apolidi, even under the new regime.
This ruling is thus likely to have far-reaching consequences, by calling into question industry practices and reminding operators of their legal obligations. Rightsholders and collecting societies alike will be watching closely to see whether this may trigger similar claims from other apolidi seeking to recover unauthorized royalty collections or undue commission fees.
[1] Court of Milan, Decision No. 10593 of May 16, 2024, published on December 8, 2024, in the civil proceedings Tattica S.r.l. v SCF S.r.l.
