The PRS Licence Loophole: What It Is and What It Costs Songwriters

What Is the PRS Licence Loophole?

The phrase 'PRS licence loophole' refers to situations where a business plays music publicly without a PRS licence - either by claiming a legal exemption, or simply by not paying. PRS for Music requires most UK businesses that play music in public to hold a licence. When they don't, the songwriters whose music is played receive no performance royalties for those plays. It is one of the most common sources of uncollected income for working musicians.

The Claimed Exemptions - and What They Actually Cover

Several genuine exemptions exist in UK copyright law, but they are narrower than businesses often claim:

• Section 72 CDPA - free public showing of broadcasts: Originally designed to allow hotels and similar establishments to show TV broadcasts to guests without a separate copyright fee. This section was narrowed significantly following European Court of Justice case law, but residual misinterpretations continue to create disputes about what qualifies as a free public showing. It does not cover playing Spotify or streamed music in a commercial space.
• Section 31 CDPA - incidental inclusion: A copyright work that appears incidentally in another work does not infringe copyright. Venues sometimes argue that background music playing when a camera pans across a room is incidental. In practice, music deliberately chosen and played in a business environment is not incidental.
• Live Music Act 2012 - this is the most misunderstood exemption: The Act removed the requirement for a premises licence for live music in venues with a capacity of 500 or fewer in England and Wales. It did not create an exemption from PRS licensing. A venue staging live performances of copyrighted works still requires a PRS licence.
• Domestic use: Music played in a genuinely private home does not require a PRS licence. The moment the same TV or radio plays in a waiting room, shop, or office, a licence is required. Courts have consistently rejected the argument that radio in a commercial workplace is private use.
• Religious services: Certain acts of worship are exempt under the CDPA. Commercial religious broadcasters are not.

Radio in the Workplace

One of the most persistent misunderstandings is radio played in shops, salons, garages, and offices. PRS requires a licence for any music played publicly in a business environment, including radio broadcasts played through speakers in a commercial space. Businesses that argue they are simply receiving a public broadcast and therefore do not owe an additional licence fee are generally incorrect. A separate PRS licence (and a PPL licence for the sound recording) is required whenever music is played in a commercial context, regardless of the original broadcast source.

Why Most 'Loopholes' Are Not Loopholes

The exemptions above are genuine but narrow. What businesses often present as a loophole is simply misreading the law. A hairdresser playing Spotify without a TheMusicLicence (which covers both PRS and PPL) is not exploiting a loophole - they are infringing copyright. PRS for Music and PPL have inspection teams that visit unlicensed premises and can pursue back payments and legal action. For businesses, the risk is real. For songwriters, it represents income that is not being collected.

What This Costs Songwriters

The financial impact is difficult to quantify precisely because it depends on what music is being played, in how many venues, and for how long. PRS for Music estimates that unlicensed music use costs the UK music industry tens of millions of pounds each year. A songwriter with significant airplay on licensed radio or in licensed venues may receive little or nothing from the same song played in unlicensed premises, even if those plays exceed the licensed ones in raw minutes.

How Songwriters Can Protect Their Income

There is no way for an individual songwriter to force a business to buy a licence. But there are steps that maximise your royalty collection from the plays that are tracked and paid:

• Register all compositions with PRS for Music - unregistered works cannot generate royalties even when they are played
• Register the publisher share with a publishing administrator so both the writer share and publisher share are collected
• Ensure your works are registered with MCPS for mechanical royalties from recordings
• Report live setlists to PRS after every performance - these are the plays PRS tracks directly
• Use a publishing administrator to audit your registrations and identify missing royalty streams

How to Get Started

If you want to ensure every possible royalty stream from your compositions is being collected, start with a Catalog Assessment.

• Visit codegroupmusic.co.uk/#catalog-assessment and complete the short form
• Receive a breakdown of which royalty streams are currently active and which are missing
• Begin with a publishing administration engagement to close the gaps

Frequently Asked Questions