Copyright Arbitration Royalty Panel

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The Copyright Arbitration Royalty Panel (CARP) system was established as a part of Congress. It started upon the suggestion of the Register of Copyrights and is sanctioned to appoint and organize copyright arbitration royalty panels. The CARP has many purposes including: first, to make decisions involving adjusting copyright royalty rates, their terms and payments. When determining the reasonable royalty rates, the CARP tries to make the creative works accessible to the public, to grant the copyright holder a fair reward for the work, and to minimize any disruptive impacts on the industries involved and associated with the copyright holder and user; second, to make determinations concerning the adjustment of the copyright royalty rates.

The CARP is being phased out due to the creation of the Distribution Reform Act of 2004. The Act consists of a system of three Copyright Royalty Judges, also known as CRJ, who will establish the conditions and rates for copyright statutory licenses (compulsory licenses) and govern the distribution system of royalties collected by the Copyright office on these statutory licenses.

The CRJ’s will serve for a six-year term, full-time and have the chance for reappointment. In order to avoid replacing all three judges at the same time, the first three judges appointed will serve staggered terms of two, four and six years.

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