Since December 2017, the Copyright Society of Nigeria (COSON) has stagnated and been unable to fulfil its fundamental obligation to its members. But there is something that is worse than the crisis itself! One of the factions insists that there is no crisis at all!
Chief Toni Okoroji, the honcho of this group would tell anyone who cares to listen that “COSON is working very well, extremely well. If you go to COSON house, you will see that it is operating at full capacity.”
But Efe Omorogbe, who is the alternative chairman appointed by the faction at variance with Okoroji would counters that: “COSON is only working for Okoroji and his acolytes and those who are offering paid services to COSON. COSON is not working for Olamide, or TuBaba nor for the big guys…”
There lies the major problem. An organisation that cannot own up to its crisis-ridden status is not about to find an end to that crisis and may be consumed by the very crisis that it denies. This time, sadly to the disadvantage of hardworking Nigerian music creators.
WHAT IS COSON
The Copyright Society of Nigeria (COSON) is one of the two copyright management organisations (CMOs) that are recognised in Nigeria.
Now, what is a CMO? The Copyright Act 1988 (as amended) defines a CMO as “an association of copyright owners which has its principal objectives as the negotiating and granting of licenses, collecting and distributing of royalties in respect of copyright works.”
And according to copyrights protection activist, Olugbenga Olatunji: “The opposite of CMO is individual management of rights. Almost all countries prefer CMO because of its advantages such as suitability to manage rights in the secondary copyright market, economies of scale advantage that leads to reduced transaction cost, availability of blanket licensing, special benefits to upcoming artistes, and collective enforcement power.”
He explains further that: “Copyright confers exclusive right on all musicians (with recognised exceptions) to authorise the use of their songs by any user, such that anyone who uses their songs without authorisation will be liable for infringement. The implication of this in practical term (using Davido as an example) is that anyone, any business, or any broadcasting corporation who desires to use Davido’s FIA track for some commercial purpose must secure his approval before use. This brings Davido under the obligation to enforce his right against erring people or businesses. But the reality, against how many individuals can Davido enforce this right? How many radio or TV stations in Lagos alone can he visit? What about other users of music such as shopping malls, eatery, nightclubs, hotels, etc. in the 36 states of the federation and FCT? How many of them can he single-handedly visit to enforce this right? Assuming he acquires some supernatural power to do this, what about the cost implication of concluding authorisation agreements with each of these users? Will it be worth it after all?”
The issue of collection management has always been a contentious issue in Nigeria. Before the formation of the COSON in 2010, the Performing Right Musical Society (PRMS) and the Music Copyright Society of Nigeria (MCSN) struggled for superiority while musicians’ right went un-catered to for years.
Investigations by eelive.ng revealed that sometime about 2006, a few music entrepreneurs got worried by the inability of the various professionals in the music industry to earn maximally from their efforts and started conversations to start a unified collecting society. These conservations, which went on for about four years involved gladiators in the MSCN, PMRS and other non-aligned stakeholders who wanted better prospects for the music industry in Nigeria.
These efforts yielded fruits in 2010 when COSON was approved with the PMRS structure subsumed into it. The MSCN resisted attempts to collaborate with promoters of the new initiative and remains an alternative collecting society until date.
At inception, COSON had an interim board of directors which later became substantive. This board which was representative of various groups of professionals like music writers, composers, publishers and label owners included people Ms Onyeka Onwenu, Tony Okoroji, Sunny Neji, Obi Asika, Ebenezer Obey, Sir Victor Uwaifo, Mr Ajayi and Efe Omorogbe. It had Okoroji as chairman.
WHEN TROUBLE STARTED
Sources told us that things started going wrong with COSON right from the start. Not wanting to be named, our source explained that the major challenge was that many members of the board were too busy to pay attention to activities of the society.
Eelive.ng sources informed that there were a lot of corporate governance issues which escalated between 2013 and 2015. One of this was the introduction of the COSON Week, which was said to have been suggested by the chairman.
Our sources told us that members of the board rejected the idea of spending COSON money on such programmes since the laws only permitted the expenditure of not more than 30percent of the collections for administrative purposes. An agreement was thereafter reached to grant Mr Okoroji’s company, TOPS, the right to seek for sponsorship for the event while the company would get a percentage of whatever it accrues.
“But at the end of the event, we were told that only N20m was made from the sponsorship drive and that they ended up spending 30 or 40million, that TOPS was in deficit, that they would need COSON to underwrite it,” our source who was a member of the initial board of the society told eelive.ng.
The source explained further that before the bubble finally burst in December 2017, there were a series of complains by some members of the board about how the society was run.
They alleged that the chairman and some members of the board had taken over the daily administration of the organisations and that there were a lot of occasions that decisions were taken without the knowledge of the board. One of the instances was about a query allegedly issued by the supervisory Nigerian Copyright Commission (NCC) said to have been answered by the chairman without consultation with other board members.
There were also accusations about lack of consultation and suspected mismanagement of the purchase and renovation of the organisation’s secretariat in Ikeja. Eelive.ng was told that the sum for the renovation, which was initially put at N11m but allegedly came with a variation that went up to a whopping N50m! The board, (through its finance committee) although miffed at the turns of events was said to have approved this payment of this sum while insisting on getting a significant discount. Shortly after this, the chairman was said to have ordered the dissolution of the finance committee, a step which members claim was beyond his capacity. And by then, the trouble within the organisation was about to take another shape.
THINGS FINALLY FALL APART
eelive.ng was told that rumbles in the COSON house came to a head in December 2017 when a few stakeholders wrote a petition to the board complaining about the running of the organisation. These members who included Chief Ebenezer Obey, Mr Bode Akinyemi, Mr Laolu Akins and Mr Toju Ejueyitchie complained about the alleged misrepresentation of the board through a “secretive” reply to the Nigerian Copyright Commission without the knowledge of the board; repeated abuse of due process in the award of contracts and the decision of the chairman to go against the resolution of the board to stop the 2017 edition of COSON Week for which he was also alleged to have given a retroactive approval for 26.2m to his company, TOPS.
On December 7, an extraordinary meeting of the society was held where the board of directors decided to remove Okoroji from office as chairman of COSON and replaced him with Efe, one of the original promoters of the idea of COSON. The board also decided to bar all its directors and their companies from taking on contracts from COSON in addition to engaging either of the two renewed auditing firms, KPMG or PWC for a forensic audit of the society.
Addressing the press at a conference in the aftermath of Okoroji’s purported removal, the Omorogbe-led COSON board explained why it elected Omorogbe to replace Okoroji.
Dare ‘Baba Dee’ Fasasi, a COSON director, explained that “the change is occasioned by the need to reposition COSON and lead it to its new era. It is time to consolidate on our gains and ensure that we get the society to the place of our dreams”.
Obi Asika, also a COSON director, said: “It is on record that during the tenure of Chief Tony Okoroji, COSON made giant strides such as the commissioning of the magnificent COSON House; the first of its kind in the Nigerian music industry, the launch of COSON’s digital licensing platform, CLAP, amongst several other key projects. His tenure also brought about the collection and distribution of royalties by COSON yearly without fail since its approval in Nigeria. However, we are confident that we are moving forward in the right direction and we know that COSON will continue to benefit from Chief Okoroji’s reservoir of knowledge and goodwill.”
But wishes are not horses and so, none of these desires by board members loyal to Omorogbe came to pass. Just a few days after, Okoroji mobilised some of his supporters across the country and sacked the COSON headquarters. This group which included Sir Victor Uwaifo also announced the reinstatement of Okoroji as chairman as well as the sack of Omorogbe, Obi Asika, Audu Maikori, Joel Ajayi, Dare Fasasi and Sikiru Agboola from the board. Six new directors were then named to replace the sacked ones.
Chief Okoroji would not response to all these accusations which he described as distractions.
POINT OF NO RETURN
Things have not been the same for COSON since these 2017 events. The crisis in the association has indeed deepened with court case after court case. At the last count, sources told us that between twelve (12) and fifteen (15) court cases have been instituted around COSON. And at some point, Omorogbe and Ajayi were briefly detained over allegations of forgery and breach of public peace.
Even though Okoroji has effective control of the assets of COSON now, the Omorogbe faction has not relented in its insistence that the latter is a mere impostor in office. In addition, that they insist that he must surrender the society to a forensic audit. A request which the chairman has repeated dismissed.
Okoroji told eelive.ng that COSON is the most audited CMO in Nigeria stating that external auditors look at the books on an annual basis. He explained: “After the presentation of the audited accounts to the Board by the COSON Finance & Audit Committee, the Board considers the accounts and if it is satisfied, the accounts are printed and sent to every member of the society at least 21 days before an Annual General Meeting (AGM) attended by the external auditors. At the AGM, every member who has issues with the accounts can raise them and to get a response. It is only after the members are satisfied, that a motion is moved to approve the accounts which become the audited accounts of COSON and is then forwarded to the Corporate Affairs Commission and the Nigerian Copyright Commission. This process has been followed every year to the minutest detail…The fact is that neither the Chairman of COSON nor the Board has the authority to order a fresh audit after the General Assembly of the members has approved the audited accounts. The only body that can legally do that is the General Assembly reversing itself if it has adequate reasons to so do.”
Yet the Omorogbe faction dismiss the posture that COSON account has been properly audited insisting that the 2018 financial statement is the most copious testament of the need for a forensic audit. Speaking with eelive.ng, Omorogbe cited the 2017 and 2018 earnings and expenditure, he said: “This is the reality, N480m collected in 2017, N209m collected in 2018, so the society collected N270m less, we had expected to double this figure in 2018 as projected. N270m in lost revenue compared to 2017, N147m in administrative cost. You collect N207m and spend N147m. They spent 31m on security in 2018, please what security, N35m on legal and N28m on Transport and travelling amongst other. None of this goes for the payments of artistes. It is interesting that a self-styled “benevolent protector” of the commonwealth of intellectual property owners, would allow the sum of sixty-five million naira (N65m) as legal and security expense on internal issues, while distributing forty million naira (N40m) as royalties to right owners. Consultants, lawyers, security and police, have earned more in 2018 than all Nigerian musicians under COSON. These financial statements provide the greatest evidence of the need for a forensic audit of COSON operations.” The idea of a forensic audit has also been supported by artistes including 2Baba, Sunny Neji, Blackky amongst others.
BUT THERE IS A BIGGER PROBLEM
Even as question of a forensic audit, which a major stakeholder has offered to pay appears to be COSON’s most serious contention, there is a more serious problem that may sound its death knell. This is the confrontation between COSON and the Nigerian Copyright Commission.
Although Okoroji told eelive.ng that no court of law in the country has declared that COSON is operating unlawfully, the newspaper is in possession of NCC correspondence communicating the suspension of COSON’s approval to operate as a CMO as well as court documents instituting criminal actions against Okoroji and four others for running a collecting society without the approval of the NCC. This October 2018 matter followed the suspension of the society’s approval via a letter addressed to the General Manager on April 30, 2018. COSON is however challenging the suspension in court.
But while at that, the situation got even worse now that the licence of the society has expired! Licences for the operation of collecting societies are for a two-year renewable period. COSON was however deep in its war of attrition when its approval expired in May 2019.
Zonal Manager of the NCC, Mr. Obi Ezeilo, told eelive.ng that the implication of this is that COSON can no longer operate as a collection management organisation until the determination of the case COSON instituted in court and the renewal of its licence.
While the elephants are all levels are slugging it out however, the Nigeria music creative suffers under the abuse of users of his work, who even when they are willing to pay royalties, do not find the bodies to pay it to.
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