Royalty remuneration and digital music exploitation
Artist claims 50% royalty for streaming at Armada Music
The Amsterdam District Court has dismissed most of the claims brought by an electronic-music producer in a dispute over royalty remuneration for digital exploitation. Between 2001 and 2009 the artist entered into seven exploitation agreements with the legal predecessors of Armada Music. Those agreements were entirely geared towards the sale of physical sound carriers - CDs, vinyl - with a royalty of 14% of the wholesale price (P.P.D.).
Digital exploitation was still in its infancy at the time. When Armada took over the exploitation rights in 2018, it also began exploiting the music via Spotify, Apple Music and YouTube. For this the artist initially received 14%, later increased to 22% of the net income. The artist considered this too little: in his view streaming is licensing to third parties, for which the agreements prescribe a royalty of 50%.
In the alternative, the artist argued that the percentage applied is unreasonably onerous within the meaning of Section 25f(2) of the Dutch Copyright Act (Auteurswet), or else unacceptable according to standards of reasonableness and fairness on the basis of Section 6:248(2) DCC. Finally, he relied on Section 25c(1) of the Copyright Act (fair remuneration), which as of 1 January 2026 also applies to old agreements.
Streaming is not a third-party licence under old record contracts
The court applied the Haviltex standard and held that the provisions on third-party licences do not cover digital distribution via online platforms. Armada had explained, without dispute, that those provisions were intended for situations in which the record company hands over exploitation entirely - for example to a foreign label for a particular territory. In the case of streaming, the record company itself remains responsible for production, marketing and creative exploitation.
Decisive was the conduct of the parties after the contracts were concluded. Since 2008 the artist had received royalty statements on which the digital income was broken down by platform - iTunes, Beatport, Napster - at the lower percentage. For fifteen years he raised no objection. The court held that Armada was therefore entitled to trust that the artist agreed to the royalty percentages applied.
The alternative claims also failed. The fact that digital exploitation was still in its infancy when the contracts were concluded does not make the provisions unreasonably onerous - that assessment is ex tunc. The reliance on Section 6:248(2) DCC likewise failed: 22% of the net income without further deductions is not unacceptable according to standards of reasonableness and fairness. The fairness criterion of Section 25c(1) Aw, applicable only since 1 January 2026, did not lead to a different outcome.
What does this mean for artists with old exploitation agreements?
The artist lost the royalty dispute but won on another point: termination. The court held - referring to the Nanada/Golden Earring judgment - that the long-term agreements are terminable after 17 to 25 years without a compelling ground. The investments were limited, the recordings were already complete when the contracts were concluded and the advances were minimal. The notice period of seven months was reasonable.
For artists with comparable old contracts the judgment offers two lessons. First: anyone who accepts royalty statements for years without objection effectively loses the right to demand higher remuneration after the fact. Second: termination is a real alternative in the case of long-running exploitation agreements. The longer the contract lasts and the more limited the label's investments, the less reason there is to require a compelling ground.contractual disputes and exploitation agreements and litigates on commercial litigation.
Frequently asked questions
Does streaming qualify as licensing to third parties?
Not without more. The Amsterdam District Court holds that distribution via Spotify or Apple Music is not a third-party licence within the meaning of classic exploitation agreements. Those provisions are intended for situations in which the label outsources exploitation entirely to a third party, not for digital distribution in which the label itself remains responsible for marketing and production.
Can an artist still claim a higher royalty after years?
That becomes difficult if you have accepted royalty statements for years without objection. The court took into account that the artist received the statements for fifteen years without protesting. That creates trust on the part of the label. Anyone who wants a higher percentage must raise the matter in good time - not after a decade and a half.
When may an artist terminate an exploitation agreement?
A long-term agreement for an indefinite period is in principle terminable, even without a statutory or contractual termination rule. The longer the contract lasts and the more limited the label's investments, the less compelling the ground needs to be. In the case of contracts of 17 to 25 years with minimal advances, no special ground is required - a reasonable notice period suffices.
ECLI:NL:RBAMS:2026:2196, Amsterdam District Court, 4 March 2026.
Cited case law
Supreme Court: ECLI:NL:HR:2017:1270
District Courts: ECLI:NL:RBAMS:2026:2196