The European Parliament (EP) has taken the initiative to question the Commission on the second approval of the merger between Sony and Bertelsmann Music Group (BMG). The question challenges certain incoherencies surrounding this decision and asks the Commission how the decision can be justified in the context of the EC’s policy of support for cultural SMEs.
The question has been submitted by Guy Bono (PSE, Fr), member of the European Parliament’s Culture Committee and currently responsible for the committee’s eagerly awaited report on the cultural industries.
Guy Bono said, “The European Parliament is exercising democratic control over European institutions by interrogating the Commission on the Sony/BMG merger. Like many cultural sectors, music suffers from chronic concentration. Artists and cultural SMEs need to be supported as they play a key role in fostering creativity and innovation as well as growth and employment in a Europe. We must put cultural diversity at the heart of EU policy”

Patrick Zelnik, IMPALA President and President of Naïve welcomed this initiative, “I am pleased to see that the European Parliament is interrogating the Commission on the Sony/BMG merger on behalf of thousands of entrepreneurs and artists across Europe. We rely on the Parliament to ensure the Commission is held to answer. The question posed by Guy Bono clearly highlights many of the key concerns voiced by IMPALA in the aftermath of the decision.”

This question follows a complaint lodged by IMPALA with the European Ombudsman which aims to be sure that the interests of cultural SME’s and artists are not marginalised.
The European Commission has a three weeks deadline to answer the written question addressed by the EP member. Please note that European Parliament will hold a public hearing on cultural industries next 20 November.

The European Commission has confirmed the merger of Sony and BMG for a second time despite the decision of the Court of First Instance in July 2006.
      - the conclusions of the European Council on the 8th May 2007 confirming that “the importance of SME’s in the cultural sector in view of their role as drivers of growth, job creation and innovation.”
      - The UNESCO Convention which underlines that “cultural diversity is manifested through the varied ways of artistic creation and production.”
      - The Commission’s communication on a European agenda for culture in a globalising world.
      - Previous cases in which the European Commission reiterated the necessity of introducing remedies to re-establish a competitive music market as was done for EMI/Warner in 2000, as well as in the Universal/BMG decision in 2007.
      - The conclusions regarding Apple and the majors in which the Commission raised competitivity problems with the majors in the online music market.
is the Commission’s authorisation of the merger between Sony and BMG coherent with the points mentioned above as well as with European policy of supporting SMEs in the music sector who create more jobs than the majors and represent 99% of the actors in the market as well as 80% of the innovation in the sector.”

Please see the attached document for the background to the Sony/BMG decision and Guy Bono’s question. Background to Sony /BMG and Guy Bono's’ question
About IMPALA  

IMPALA was established in April 2000 to help independent record companies and music publishers to consider the issues of interest to independent music companies and to promote the expansion and competitiveness of independent music in the interest of cultural diversity.
99% of music companies are SMEs. The independents are world leaders in terms of R&D and discovering new music and artists. Despite this, they face increasingly complex barriers to trade and severe market access problems. Over 80% of the market and 95% of key radio and retail is concentrated in the hands of the majors. The independents’ collective market share fluctuates considerably from territory to territory in Europe. The gap between the majors and the independents is now so wide that not one independent has more than 1.5% across Europe.
IMPALA has over 3500 members including the top independents: !K7 (Germany), Beggars Group (UK), Bonnier Amigo (Sweden), CLS Kft (Hungary), CNR (NL), Cooking Vinyl (UK), Edel (Germany), Epitaph (US/NL), Gazell (Sweden), Menart doo (SIovenia), Musicvertrieb (Switzerland), Naïve (France), Odyssey (Ukraine), PIAS Group (Belgium), Playground (Sweden), Red Bullet (NL), Soyuz Music (Russia), SPV (Germany), V2 Music Group (UK), Wagram (France), as well as national trade associations from the UK (AIM), France (UPFI), Germany (VUT), Spain (UFI), Italy (PMI), Denmark (DUP), Norway (FONO), Israel (PIL) and Sweden (SOM) and the Catalonian association APECAT.
For further queries, please see or contact IMPALA on T: + 32 2 503 31 38, IMPALA, Coudenberg 70, B-1000, Brussels.