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Federal Register / Vol. 86, No. 27 / Thursday, February 11, 2021 / Rules and Regulations
information that the MLC or DLC
receives in connection with leasing office space or equipment, requisitioning supplies, or making other contractual arrangements. 66 FMC
asserts that financial or business terms that could be used for commercial advantage is an inherently problematic category definition when some DSPs and some copyright owners have seemed eager to use every piece of available data for their commercial advantage, if they can think of a possible way to do so. 67
The Office agrees that cabining confidential information to include sensitive financial or business information disclosed by digital music providers, significant non-blanket licensees, or copyright owners or any of their authorized agents or vendors to the mechanical licensing collective or digital licensee coordinator would help reasonably ensure that the Offices regulations apply in relation to the administration of the section 115
statutory license, as opposed to information provided to the MLC and DLC more generally e.g., supply contracts. The interim rule accordingly adjusts the definition of confidential information to mean sensitive financial or business information disclosed by digital music providers, significant nonblanket licensees, and copyright owners or any of their authorized agents or vendors to the mechanical licensing collective or digital licensee coordinator. With respect to FMCs position that the phrase financial or business terms that could be used for competitive disadvantage or be used for commercial advantage could apply to data generallyto even nonconfidential informationthe Office notes that the phrase already modifies sensitive financial or business information to exclude broader types of information, and is also limited by the enumeration of non-confidential information articulated above.
ARM, while asserting that the proposed general definition is appropriate, asks that the definition specifically include information such as royalty rates and other provisions of agreements between recorded music companies and digital service providers. 68 The MLC supports ARMs position.69 In recognition of the need to protect sensitive data in agreements between recorded music companies and 66 Id.
67 FMC

NPRM Comment at 1.
NPRM Comment at 4; see id. at 1214.
69 MLC NPRM Comment at 20 Confidential information for particular sound recording licensors shall not be disclosed to copyright owners, songwriters or digital music providers..
68 ARM

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DMPs, the interim rule amends the definition of confidential information to also mean sensitive data concerning agreements between sound recording companies and digital music providers.
At the MLCs suggestion, the proposed rule excluded from the definition of confidential information, top-level compilation data presented in anonymized format that does not allow identification of such data as belonging to any digital music provider, significant nonblanket licensee, or copyright owner.70 Both the MLC and DLC incorporated this language into their respective proposed regulatory language,71 and no commenters objected. Accordingly, the interim rule adopts this aspect of the proposed rule without modification.
Commenters supported the definition of confidential information including information submitted by a third party that is reasonably designated as confidential by the party submitting the information, as well as usage data and other sensitive data used to compute market shares when distributing unclaimed accrued royalties, sensitive data shared between the MLC and DLC
regarding any significant nonblanket licensee, and sensitive data concerning voluntary licenses or individual download licenses administered by and/
or disclosed to the MLC. 72 In their respective proposals, the MLC and DLC
retained the Offices proposed provisions stating that confidential information does not include documents or information that are public or may be made public by law or regulation, or documents or information that may be made public by law or that at the time of delivery to the MLC or DLC is public knowledge. 73 By contrast, ARM expresses concern with the phrase information that may be made public by law, saying it is unclear, and that when inserted in an exception to the general definition of Confidential Information, that phrase could be read to say that any information the disclosure of which is not otherwise prohibited by law is excluded from the definition of Confidential Information, meaning that 70 85 FR at 22562; MLC Initial NOI Comment at 30; MLC Reply NOI Comment App. at 27.
71 MLC NPRM Comment App. at ii; DLC NPRM
Comment Add. at A2.
72 85 FR at 22567; see MLC NPRM Comment at 8 stating that the phrase information submitted by a third party that is reasonably designated as confidential by the party submitting the information can largely be integrated into this definition of Confidential Information; DLC
NPRM Comment Add. at A1; ARM NPRM
Comment at 11.
73 MLC NPRM Comment App. at iii; DLC NPRM
Comment Add. at A1.

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information only qualifies as Confidential Information when its disclosure is otherwise prohibited by law. 74 The Office believes the language is reasonably clear, and notes that the phrase information that may be made public by law is meant to cover information for which the Offices own regulations require certain disclosures from DMPs and significant nonblanket licensees that would not be considered confidential. This intention is made clear by subsequent subparagraphs enumerating these categories. After carefully considering these comments, the interim rule retains these aspects of the proposed definition.
Finally, ARM contends that because this rule focuses on the protection of information, referring to documents uniquely in the exclusions from the definition of Confidential Information creates interpretive issues, as documents embody information and a document that contains some Confidential Information should not be excluded from protection simply because it also includes some other information that is excluded from the definition of Confidential Information. 75 ARM maintains that the exceptions should apply only to information, and not to some potentially broader category of documents. 76 The Office agrees that the regulation intends to prevent the improper use or disclosure of confidential information.
The Office also agrees that a document containing both confidential and nonconfidential information should be extended protection, and did not suggest otherwise when issuing the proposed rule. Rather, the proposed rule identified specific documents e.g., notices of nonblanket activity and sources of information e.g., the public musical works database for which the Offices regulations require disclosure and to which confidentiality restrictions would not apply.
Accordingly, the Office has adjusted the phrase documents or information that are public or may be made public by law or regulation to refer solely to information. By focusing on information as opposed to documents, the rule clarifies that the MLC and DLC would be prohibited from disclosing documents containing confidential information disclosed by digital music providers, significant nonblanket licensees, and copyright owners or any of their authorized agents or vendors or third parties that reasonably designate information as confidential 74 ARM

NPRM Comment at 5.
at 45.
76 Id. at 5.
75 Id.

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