Implications of recent judgments on transfer of copyright and related rights in a (Belgian) employment relationship

a)            CJEU NOB ruling

On 6 March 2025, the CJEU issued a ruling in the case of musicians against the Belgian State (C 575/23). The case concerned the lawfulness of the Belgian Royal Decree of 1 June 2021 concerning the related rights of artistic personnel of the Belgian National Orchestra (Royal Decree), which stipulates that musicians employed by the National Orchestra of Belgium (NOB) automatically transfer their related rights (such as the right of communication to the public, reproduction and distribution rights), worldwide and for the entire protection period, to their employer (NOB) without their explicit consent.

Challenging the automatic transfer of their related rights through various platforms (such as radio, television, digital platforms), the musicians brought their case before the Belgian Council of State. The Council of State then referred preliminary questions to the CJEU to assess whether the Royal Decree violated EU directives, paving the way for a decision with significant implications for the transfer of related rights.

The CJEU sided with the musicians and ruled that such automatic transfer without prior consent violates Article 2(b) and Article 3(2)(a) of Directive 2001/29/EC (Infosoc Directive), as well as Article 3(1)(b), Article 7(1), Article 8(1) and Article 9(1)(a) of Directive 2006/115/EC (Rental and Lending Rights Directive). These articles grant performers exclusive rights to authorize or prohibit the reproduction and communication of their performances, and do not contain any exception that allows automatic transfer without consent. The CJEU emphasized that this protection applies regardless of the nature of the employment relationship, whether contractual or statutory. Furthermore, the CJEU affirmed that the principle of appropriate and proportionate remuneration, as established in Directive 2019/790 (DSM Directive), prohibits any national measure that unilaterally transfers exclusive rights without obtaining the rightsholder's explicit consent and guaranteeing adequate compensation.

Consequently, the Royal Decree is contrary to EU law because it transfers the exclusive rights of musicians to their employer without prior consent. Belgian legislation must be amended accordingly. This implies that any future exploitation of performances must comply with the strengthened requirements, including the necessity of prior consent and fair remuneration.

b)            Supreme Court ruling

On 3 March 2025, the Belgian Supreme Court issued a ruling confirming the judgment of the Court of Appeal of Antwerp of 16 June 2022 (Nr. S.23.0078.N), which held that the remuneration paid by TVBASTARDS (a television production company that engages actors, directors, and other professionals for the creation of television programs) to its employee-authors and employee-performers for the transfer of copyright and related rights can be considered “wages” within the meaning of Article 2 of the Law of 12 April 1965 on the protection of workers’ wages and salaries (Loonbeschermingswet), and is therefore subject to social security contributions payable to the National Social Security Office (RSZ/ONSS).

Moreover, the Supreme Court confirmed that:

• Many of the actors and directors are employed by the production company under open-ended employment contracts and, in return for the work performed under those contracts, receive a monthly gross salary.
• These employment contracts specify, in addition to the gross monthly salary, the position and responsibilities the employees are expected to fulfil in the production of the television programs.
• In addition, production companies, often through a separate agreement, provide for the payment of a lump-sum fee to the actors, directors, and others employed under an employment contract, in consideration for the transfer of their economic rights and related rights. These separate agreements for the transfer of copyright and related rights also refer to the employee’s role in the production of the television programs and to the characters and roles they are required to portray in the execution of their employment contract.
• The aforementioned separate agreements for the transfer of copyright and related rights are often signed on the same day as the employment contracts. These agreements provide for a lump-sum payment in euros to contractually engaged actors or performers for the transfer of their economic copyright and related rights to the employer.
• These lump-sum payments for the transfer of copyright and related rights thus constitute “monetary benefits” within the meaning of Article 2 of the Law of 12 April 1965 on the protection of workers’ wages and salaries.
• The fact that the transfer of copyright and related rights was not regulated in the employment contract itself, but in a separate agreement, does not negate the connection between the transfer of economic rights and the employment contract.

As a general rule, employees retain all economic and moral rights to works created within the scope of their employment, unless the contract or statute explicitly provides for the transfer of economic rights and/or a waiver of moral rights, provided that the creation of the work falls within the scope of the contract or statute.

Therefore, if the employer wishes to retain the economic and moral rights, this must be explicitly contractually (not necessarily in the employment agreement self) /statutory agreed upon. In contrast, the employer is deemed to have acquired all economic rights on computer programs, software, databases, and designs developed by employees in the exercise of their duties under the employment contract, unless otherwise contractually stipulated. Therefore, the employer does not need to include a transfer clause in the employment contract in relation thereto. However, employees may produce copyrighted works related to software that are not covered by this exception, such as user manuals, information sheets, software documentation, or other associated materials. These documents and materials will be subject to the general principle that employees retain both the economic and moral rights, unless otherwise specified in their employment contract or in a separate agreement / document between the parties.

The CJEU NOB judgment has significant implications for employment contracts in Belgium, particularly in the area of related rights and the protection of performing artists.

First, the judgment emphasizes the importance of securing explicit agreements regarding the ownership and use of works created by employees. The assumption that an employer owns the rights to works created during employment may no longer be sufficient without clear contractual provisions. Employment contracts (or separate agreements) will likely need to include detailed clauses outlining the scope of the employer’s rights over any creations, as well as the terms under which these rights are transferred.

Additionally, the judgment highlights the requirement for fair remuneration and informed consent when it comes to related rights, such as performers' rights. This means that employers in the media, entertainment, and software industry may need to implement separate compensation structures for employees whose work generates related rights. As a result, negotiating IP clauses could become more intricate, particularly when employees' creations hold a commercial value that extends beyond the standard employer-employee relationship.

Consequently, Belgium must amend its legislation to comply with EU directives, meaning that the automatic transfer of related rights without the explicit consent of the artists is no longer permitted. This ruling confirms that performing artists, including musicians in the public sector, have the exclusive right to authorize or prohibit the reproduction and communication of their performances. This provides them with greater control over their work and better protects their interests.

Ultimately, the NOB judgment calls for a shift towards more transparent, individualized clauses in Belgian employment contracts to ensure compliance and avoid future disputes over IP ownership and compensation. Employers will need to revise their employment contracts (or separate agreements) to ensure that the transfer of related rights is explicitly agreed upon and consented to by the performing artists. This may lead to more negotiations and clearer agreements between employers and employees. Additionally, this ruling can serve as a precedent for future cases involving the rights of performing artists, underscoring the importance of consent and the protection of artists’ rights within the EU.

Additionally, the Belgian Supreme Court ruling has several practical implications for employers, particularly in the creative and media sectors:

• Employers must treat lump-sum payments for the transfer of copyright and related rights –
• if stipulated in a separate contract – as “wages” within the meaning of Article 2 of the Law of 12 April 1965 on the protection of workers’ wages and salaries (Loonbeschermingswet). As a result these payments are subject to social security contributions (RSZ/ONSS).
• The ruling confirms that structuring copyright payments in separate agreements does not disconnect them from the employment relationship if (i) the rights are transferred in the context of work performed under an employment contract, (ii) the roles, tasks, or characters are linked to the employee’s function.

Consequently, employers must re-evaluate their treatment of copyright-related compensation for creative staff (e.g., actors, directors, writers) to ensure compliance with legal and social security obligations.