Royalties & Residuals

A quick overview of Royalties & Residuals:

Residuals: When working under AFM/CFM-negotiated agreements, musicians are not only paid for the initial performance, but also receive “backend” payments, known as residuals, for the continued use of their recording or performance.

Royalties: These are payments made to creators of copyrighted works and are generated from various sources, including live performances, radio broadcasts, sales (such as streaming, digital downloads, and albums), and licensing (for use by other artists, or placement in films or TV shows). Royalties are collected and distributed by specific organizations using a predefined formula. Common types of royalties include mechanical, performance (including neighboring rights), and sync royalties. It’s important to note that the AFM/CFM does not handle the collection or distribution of royalties.

The significance of protecting your original work through copyright and ensuring you work under contracts that safeguard your rights cannot be emphasized enough.

Here are some organizations that musicians might encounter:

Primary Market

Primary markets refer to the initial broadcast or exhibition of your recorded session. For example, if you work on a CBC production, your original session fee covers the first broadcast use of the recording.

  • Reuse: Any additional broadcasts beyond the initial window require a reuse fee. These residuals are collected and distributed through the CFM office.
  • New Use: If your recorded music is used in a different format, this triggers a new use payment. For instance, if a song recorded for an album is later used in a commercial, a new session fee is required, along with usage fees based on how the commercial is aired (e.g., TV, internet, radio). The AFM/CFM collects new use fees and disperses them to the Local where the song was recorded. If you believe you’re owed a new use payment, you can contact your Local for assistance.

Secondary Market

Secondary markets are instances where your content is exhibited after its initial release. For example, if you recorded a film score, its primary exhibition would be in a theater, but subsequent releases, such as DVDs, are considered secondary markets. Two organizations that handle secondary market residuals are:

It’s a good practice to check their websites for any unclaimed cheques.

Film Musicians Secondary Markets Fund (FMSMF)

This organization collects and distributes residuals for musicians who worked on AFM-covered theatrical and TV productions. It also distributes payments to musicians whose previous recordings have been used in new productions. Composers are generally not covered unless they have performed specific “bargaining unit work,” such as conducting or orchestrating.

Find more information at: fmsmf.org

AFM-SAG AFTRA Fund

This fund administers residual payments for sound recordings, motion pictures, television in certain foreign markets, and symphonic projects.

Learn more at: afmsagaftrafund.org