By the end of this year, all of these public facilities in Shanghai as well as KTV bars and discos will be charged a fee based on their size to pay royalties to the songwriters, performers and composers of the music they play.

Last August, the city began pushing large entertainment facilities to begin paying copyright fees to the Shanghai Music Copyright Society, raising 2 million yuan (US$240,000) from 1,354 venues to date.

"Protecting intellectual property rights is a logical move. Charging for background music is a significant development in China," Lou Rongmin, deputy director of the Shanghai Copyright Administration, said yesterday.

Though many local hotels and department stores are still unaware of the charge, most of them interviewed yesterday by Shanghai Daily said they will pay.

"Our store will follow the regulation in accordance with the standard in the future," said Linda Shi, a spokeswoman for Lane Crawford, a department store on Huaihai Road.

To begin with, venues will be charged a fee based on an agreement Beijing's Music Copyright Society reached with Beijing Copyright Administration earlier this year, but the local society may try to renegotiate those charges.

According to Qu Jingming, deputy secretary general of the Shanghai society, the fee will be based on business area and focus.

Hotels will be charged based on the number of beds they have, while shopping malls, discos and bars will pay fees based on floor space.

While it has taken time to set the fee, the real trick is collecting the money.

"(In the past) the biggest problem was that the owners weren't aware that they should pay for background music,'' said Chen Xiyuan, a spokesman for the Shanghai Music Copyright Society.

"They never realized that they were playing their compact discs for business use, not private," Chen said.

(eastday.com October 12, 2002)