Music Management Conflicts of Interest: Spot and Negotiate Protections
/Hidden Conflicts in Modern Music Management Deals
A manager-artist relationship can encompass music, publishing, label services and merch, all under the same management company or a management company’s subsidiary companies. That can look efficient on the surface, but it also opens the door to potentially serious conflicts of interest, commission stacking, a.k.a. “double dipping”, that cuts into your income and control as an artist.
In music, film, TV and digital work, managers may also act as producers, music publishers, label owners and merch partners. One management relationship can extend to many other contractual obligations, such as:
Record production agreements
Recording agreements or development deals
Music publisher single song and exclusive term contracts
Merchandising agreements and management commissions, endorsement or commercial tie-in deals
When these roles and commissions are not clearly separated, you can end up with lower royalties, stacked commissions on the same income source and less control over income from record licensing and distribution agreements, collaboration agreements or live performance contracts and riders. This is a key reason why many artists work with a music lawyer before they sign such multi rights or 360° agreements with a manager.
Where Conflicts Hide in Management
Be aware of wording such as:
Management agreements that entitle the manager to also “produce” masters, “administer” songs or “exploit” audio and audio-visual masters or music publishing
Management agreements that specify a broad power of attorney allowing the managers to enter into long term third party agreements binding the artist
Music publishing or record production agreements that are attached as schedules and form part of the management agreement
If the same manager controls a company that signs you to a recording agreement or development deal, conflicts can arise when: advising you as your personal career manager and also acting as your record label. If they also run a music publishing company that signs your songwriting services under a co-publishing agreement or exclusive term contract, the conflict gets deeper.
Cross-collateralization of these income sources, for example, master purchase and sale agreements, master use licences and domestic and foreign licensing of record masters can all be tied to your management company or its affiliates own and control recordings and music
Understanding Commission Stacking Across Your Revenue Streams
“Commission stacking” happens when the same entity takes commissions from publishing the same income source more than once.
For example, here is how multiple commissions can occur when a manager serves several roles:
Recording income from recording agreements or distribution deals, plus a production fee through record production agreements
Music publishing income from mechanical licences, synchronization licences and sub-publishing agreements or a share through a co-publishing agreement
Live performance fees from contracts and riders, with extra margins from sound and light agreements or transportation agreements they control
Merchandising income from merchandising agreements and endorsements or commercial tie-ins where the manager is also a merch partner or manufacturer.
In addition, there are audit and accounting issues when a manager is also the music publisher and record label. They are often the entity accounting to the artist and rendering royalty statements. If the management agreement does not give clear rights to audit accounting and royalty statements it is much harder to challenge underpayments or hidden revenue.
Key Contract Protections to Negotiate Before You Sign
Many of these risks can be reduced if you negotiate clear contractual protections before you sign. Careful contract review with a music law lawyer can make a significant difference.
Role separation and disclosure are a strong starting point. You can:
Require that management agreements, record production agreements and music publisher contracts clearly define each role
Insist that if the manager or any related or affiliated company of manager of manager’s affiliates is involved, that relationship must be disclosed in writing
Commission caps and exclusions are also important. It is common to:
Cap the total management commission percentage that can be taken across all services provided and contracts controlled by the manager
Prohibit commission stacking on the same income stream, so you are not paying the manager twice on the same income source
Exclude certain specified revenue from management commission
Approval rights matter too. You can negotiate:
Artist approval over third party co-publishing agreements, master purchase and sale agreements and option agreements in film and television
To include wording in the agreements entered into that you are free to seek independent legal advice from a music law lawyer on agreements and addenda before you sign or renew anything
Strengthening Your Position Across Related Music Contracts
Protecting yourself is not only about your management agreement. Your whole contractual structure needs to be aligned.
Contract terms should also be consistent across:
Recording and record production agreements
Live performance contracts and riders, plus agreements for musicians’ services
Endorsement, sponsorships, commercial tie-in deals, and merchandising agreements
Music publishing agreements
You also want to protect your IP and brand. That can mean:
Trademarks in your own name or in an entity you control, not in a manager-controlled company
Making sure copyright registration and copyright licences do not move full ownership to the manager
Owning your social media and e-mails
How A Music Lawyer Can Help
Untangling conflicts of interest and commission stacking is not something most artists can or should try to do on their own. A focused legal review by qualified legal counsel can show how all your agreements connect.
A music lawyer can:
Review management, agency, co-management and booking agent agreements together
Compare producer agreements, publishing contracts, live performance agreements and merchandising deals to find overlaps with the management agreement
Suggest amending agreements and addenda that separates management roles, clarify commissions and improve audit and approval rights
When there is tension, a music lawyer can help reset the relationship without necessarily ending it.
Take time to sort out and avoid conflicts of interest and commission stacking in your management and related agreements. This can give you more control over your career and fewer surprises down the road.
Protect Your Music Career With Clear, Fair Agreements
As musicians and creators, you should not be guessing what you are signing or what rights you are granting or giving up. At Sanderson Entertainment Law we can help you understand, negotiate and secure contracts that reflect your goals and protect your future income. We can walk you through every key clause in plain language so you can make informed decisions with confidence. Ready to move forward with a new deal or review an existing one? Contact us to schedule a consultation.
This post is written for Canadian artists and is based on Canadian law. It is general information only and is not legal advice for your specific situation.