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TARIFF FOR THE PUBLIC USE OF SOUND RECORDINGS
Tariff Code: A
Title: Discotheques
Effective Date: February 2018
CBI (B) Base: 103.7

1) Licence Fees are payable in accordance with the “Terms of Payment” hereinafterstated.

2)The minimum licence fees provided for above will be adjusted annually and increased or decreased by the percentage rise or fall in the Consumer Price Index “B” during the Financial Year immediately preceding the licence year.

3)Please make cheque payable to “Phonographic Performance (South East Asia) Limited”.

 
Licence Fee Calculation

 

Maximum Permitted Capacity

 Annual Licence Fee Payable

Band  1 

50 persons and Under 

3% of the turnover of the establishment for the financial year immediately preceding the year for which a licence is sought,  subject to a minimum licence fee of HK$99,000.00 and a maximum licence fee of HK$ 198,000.00. 

Band  2

51 to 100 persons

3% of the turnover of the establishment for the financial year immediately preceding the year for which a licence is sought, subject to  a minimum licence fee of HK$148,000.00 and a maximum licence fee of HK$ 296,000.00.

Band  3

101 to 200 persons

3% of the turnover of the establishment for the financial year immediately preceding the year for which a licence is sought, subject to a minimum licence fee of HK$198,000.00 and a maximum licence fee of HK$ 396,000.00.

Band  4 

Over 200 persons 

3% of the turnover of the establishment for the financial year immediately preceding the year for which a licence is sought, subject to a minimum licence fee of HK$230,000.00 and a maximum licence fee of HK$ 460,000.00

 

LICENSOR :

Phonographic Performance (South East Asia) Limited [“PP(SEA)L”]

TARIFF  :

Discotheques and other establishments using recorded music for the purpose of dancing.  The Licence Fee for a Licence for any Licence Year shall be:

BAND 1  :

Maximum Permitted Capacity of the establishment: 50 persons and under

Fee payable per annum :

3% of the Turnover of the establishment for the Licence Year immediately preceding the year for which a Licence is sought subject to a minimum Licence Fee of HK$99,000 and a maximum licence fee of HK$198,000.

BAND 2  :

Maximum Permitted Capacity of the establishment: 51 to 100 persons

Fee payable per annum :

3% of the Turnover of the establishment for the Licence Year immediately preceding the year for which a Licnece is sought subject to a minimum Licence Fee of HK$148,000 and a maximum licence fee of HK$296,000.

BAND 3  :

Maximum Permitted Capacity of the establishment: 101 to 200 persons

Fee payable per annum  :

3% of the Turnover of the establishment for the Licence Year immediately preceding the year for which a Licence is sought subject to a minimum Licence Fee of HK$198,000 and a maximum licence fee of HK$396,000.

BAND 4  :

Maximum Permitted Capacity of the establishment: Over 200 persons

Fee payable per annum :

3% of the Turnover of the establishment for the Licence Year immediately preceding the year for which a Licence is sought subject to a minimum Licence Fee of HK$230,000 and a maximum licence fee of HK$460,000.


 1. TERMS AND CONDITIONS: 

(1) “Maximum Permitted Capacity” means the maximum number of persons permitted to be on the establishment at any one time by the Food And Environmental Hygiene Department under the terms of the Liquor Licence pertaining to the establishment or in the event that the Food And Environmental Hygiene Department has not specified the maximum number of persons permitted on the establishment at any one time the gross floor space of the establishment in square metres times one point five.

(2) “Establishment” means any premises or part thereof and whether under sole or multiple occupancy.  Any assessment as to whether an establishment is used for dancing will depend on the facilities and equipment within the establishment which may be used for such purpose.

(3) “Licence Year” means from 1st January to 31st December.

(4) “Financial Year” means from 1st January to 31st December in any year.

(5) “Dancing Area” means any establishment or as the case may be that part of any establishment other than a Non-Dancing Area where facilities are provided (whether or not the same are actually used) for the performance of sound recordings as featured entertainment for the purposes of dancing.

(6) “Non-Dancing Area” means an area within the establishment other than a dancing area from which no access to nor contact with the Dancing Area can be obtained without payment of a fee including any membership fee or any additional fee for food or beverage consumed within the Dancing Area whether such fee is charged at the point of entry to the Dancing Area or elsewhere in the establishment.

(7) “Turnover” means the total gross revenue received from all sales whether from cash or credit or otherwise of goods, food, beverages or services, including without limitation fixed service charges, entrance and membership fees arising from any business conducted on, at or from the establishment whether by the Licensee or others subject only to the following deductions: -

(i) any revenue which is solely and exclusively derived from customers using a Non-Dancing Area;
(ii) rent paid to the Licensee by any third party for the temporary use of the establishment.

 

2. TERMS OF PAYMENT: 

 All Licence Fees shall be made payable by the Licensee directly to PP(SEA)L as follows: -

(1) For Licences taken out on or before 31st March of each Licence Year: -

(i) 75% of the applicable Minimum Annual fee at the time of the application of a Licence;

(ii) the balance of the Licence Fee payable in respect of the Licence Year on or before the 30th June of that Licence Year.

(2) For Licences taken out on or after 1st April of each Licence Year: -

(i) 75% of the Licence Fee payable for the Licence Year within one (1) month of the date of the application; and

(ii) 25% of the Licence Fee payable for the Licence Year within three (3) months of the date of the application or by 31st December of the Licence Year whichever is the sooner.

(3) In the event of any default by the Licensee in the payment of any installment(s) payable under 2(1) and 2(2) above, the outstanding annual Licence Fee together with interest thereon at 2% above the Hong Kong and Shanghai Banking Corporation prime lending rate from the date the installment falls due until the date of payment shall immediately become due and payable.

(4) In the event that a Licensee

a) goes into voluntary or compulsory liquidation during the course of a Licence Year; or

b) has ceased trading; or

c) has terminated the Licence,

the Licence Fee for that Licence Year during which termination occurs shall be pro-rated on a daily basis for the period from 1st January to the date of the occurrence of such event and if any amount of Licence Fee remains outstanding that amount shall immediately become due and payable.

The Licensee shall inform PP(SEA)L by notice in writing of the termination not later than 14 days from the effective date of occurrence of such event.

(5) Where a Licensee is issued with a Licence in accordance with the terms hereof and such Licence is revoked or otherwise terminated and the Licensee is at any time thereafter issued with a further Licence in respect of the same establishment, the Licence Fees payable in respect of the second or any subsequent Licence will be assessed on the Turnover calculated and increased pro rata where necessary as if the Licensee had been continually licensed from the date of issue of the original Licence.

(6) The Licensee will deposit with PP(SEA)L on or before 1st March in the Licence Year a certified Statement of Turnover of the establishment from a Certified Public Accountant in respect of its operations conducted in, at or from the establishment for the preceding Licence Year or part thereof.  In the event that such certified Statement of Turnover has not been prepared in respect of the Licensee on or before the 1st March in the Licence Year the Licensee will deposit with PP(SEA)L on or before the 1st March in the Licence Year management accounts signed by two directors of the Licensee certifying the Turnover for the preceding Licence Year or part thereof and will deposit with PP(SEA)L a certified Statement of Turnover for the preceding Licence Year or part thereof from a Certified Public Accountant on or before 30th September in the current Licence Year.  In the event such certified Statement of Turnover differs from the management accounts, PP(SEA)L shall be entitled to adjust the Licence Fee for the relevant Licence Year and any deficiency or any portion of Licence Fee already paid shall be immediately due and payable by the Licensee to reflect such difference.

(7) Where the Licensee takes out a licence on or after 1st April, Licensee shall deposit the certified Statement of Turnover mentioned in (6) above within one month of the date of application.  In the event that such certified Statement of Turnover has not been prepared within one month of the date of application, the Licensee will deposit with PP(SEA)L management accounts signed by two directors of the Licensee certifying the Turnover for the preceding year or part thereof and will deposit with PP(SEA)L a certified Statement of Turnover for the preceding Licence Year or part thereof from a Certified Public Accountant within three(3) months of the date of the application or by 31st December of the Licence Year whichever is the sooner.  In the event such certified Statement of Turnover differs from the management accounts, PP(SEA)L shall be entitled to adjust the Licence Fee for the relevant Licence Year and any deficiency or any portion of the Licence Fee already paid shall be immediately due and payable by the Licensee to reflect such difference.

(8) In the event such certified Statement of Turnover has not been submitted under (6) and (7) above in the Licence Year, PP(SEA)L shall be entitled to apply the maximum license fee for the relevant Licence Year. 

(9) Within 10 working days following receipt of the Statement of Turnover or management accounts, PP(SEA)L will advise the Licensee of the Licence Fee payable for the current Licence Year subject to (10) hereof.

(10) PP(SEA)L or its designee shall have the right at any time during the Licence Year at its own cost and expense, upon 5 business days’ prior notice, to appoint an Accountant nominated by the President of the Hong Kong Society of Accountants to inspect such books and records of the Licensee as may in the opinion of PP(SEA)L be necessary for the purpose of verifying the Statement of Turnover submitted by the Licensee for any Licence Year.  In the event that PP(SEA)L exercises its right of inspection under this clause, PP(SEA)L shall notify the Licensee in advance of the commencement of the inspection and the Licensee shall use its best endeavours to cooperate with PP(SEA)L in the inspection.  The Licensee shall maintain accurate records of all transactions carried out at on or from the establishment for each Licence Year for a minimum of 2 years from the end of that Licence Year.

(11) If any inspection carried out pursuant to paragraph (10) discloses a liability for a Licence Fee greater than that charged pursuant to paragraph (6) the Licensee shall immediately pay the deficiency in the Licence Fee and if the deficiency exceeds 5% of the Licence Fee charged in paragraph (6), the Licensee shall bear the full cost of such inspection and shall make payment of such costs to PP(SEA)L within 10 days of the completion of the investigation.

(12) Where an establishment using recorded music for the purpose of dancing was in operation for less than six months during the preceding Licence Year the Licensee will pay the minimum Licence Fee provided for according to the tariff band into which it falls.  That Licence Fee will be subject to upward adjustment in accordance with the actual Turnover of all business conducted at, in or from the establishment in the first twelve months of operation.  Where during the preceding Licence Year the establishment using recorded music for the purposes of dancing was in operation for not less than six months, but less than the entire Licence Year the assessment will be based on the actual Turnover and increased pro rata in order to arrive at a figure for the entire Licnece Year.

(13) Where an establishment using recorded music for the purpose of dancing is in operation for less than 365 days during the Licence Year, the Licence Fee payable for that year shall be pro-rated accordingly.

(14) In the event that dancing facilities are provided at the establishment for less than five nights on average per week, the Licence Fees provided for in the Tariff and the applicable minimum annual Licence Fees will be subject to the following reductions:

No. Of Days Per Week During
Which Dancing Takes Place                                  % Reductions
      
                  2                                                                      40.00
                  3                                                                      30.00
                  4                                                                      20.00

Any establishment which operappseal_business on more than four nights a week must pay the full annual licence fee provided for hereunder.  Any establishement which uses recorded music for the purpose of dancing on only one night per week must take out a one-off licence for each such occasion and this Tariff is not applicable.

(15) Notwithstanding anything to the contrary the Licence Fee in the Licence Year shall be subject to a discount calculated as follows: -

(i) Where live music is provided at the establishment after 9 p.m. on everyday on which any business is in operation at the establishment and where such live music is provided for more than 20% of such hours of operation after 9 p.m. the Licensee shall be entitled to a reduction representing that proportion which the total number of hours during which such live music is performed after 9 p.m. bears to the total number of hours of operations;

(ii) Such reduction shall not exceed 50% of the annual Licence Fee and shall be subject to production of all relevant performance contracts.

(16) Any notice, Statement of Turnover or other document which is required to be served on PP(SEA)L hereunder will be presented in a legible form and will become the property of PP(SEA)L with effect from the date of delivery.  PP(SEA)L will not divulge any information relating to the Turnover of any Licensee or information of a confidential nature relating to the operations of individual Licensees.

(17) In the event that the establishment is used for any other purposes on days on which no dancing facilities are provided but recorded music publicly performed, a separate licence will be required to be taken out from PP(SEA)L according to the use to which the establishment is put on those days; (appropriate Tariff will be applicable).

(18) This Tariff does not extend to the use of music videos for public performance on the establishment or to the use on the premises of the establishment in connection with exhibitions, promotions, fashion shows or other demonstrations conducted by third parties.  The Licensee shall inform PP(SEA)L of any such event.

(19) If the Licensee fails to fulfill any of its obligations hereunder, PP(SEA)L may give notice in writing to the Licensee requiring it to fulfil its obligation(s) and if the Licensee within the period of 30 days from service of such notice fails to comply with it, PP(SEA)L shall have the right without prejudice to any right or remedies it may have against the Licensee to revoke the Licence.

 
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