Due to huge losses on the stock market in 2008 Dutch collecting society Buma-Stemra is not able to pay all collected royalties to its claimants, the artists.  Buma-Stemra, will retain a staggering 10.4% of all royalties collected over 2008 (€ 140 million Euros) to cover its costs and to compensate its losses on the stock market. In 2007, Buma-Stemra only retained 1.2% of all moneys collected to cover its costs. This is shown in the Annual Financial Report of Buma-Stemra of 2008 that recently got published.

Since years Buma-Stemra is investing moneys collected on behalf of its claimants between the time of collection and payment to the artists, in order to cover the costs of the organization and its management. In previous years these costs were almost always fully covered with a positive return on the investments made. In 2008, however, Buma-Stemra’s luck changed.  In addition to the operational costs of more than  € 12 million Euros, Buma-Stemra saw an extra € 14 million Euro of investments go up in smoke. The organizations reserves for 2008 were not sufficient to offset those losses. An accounting trick, to ease the pain somewhat, carried a loss of € 6.5 million Euro forward to next year. The remaining loss of  € 13.4 million euro shall be borne by the artists; Buma-Stemra shall deduct the 10,4% from their royalties.

Buma-Stemra’s Director Cees Vervoord declared that a deduction of more then 10% is indeed high, but permissible. Vervoord expects a return to the usual deduction of 1% to 2% next year. Buma-Stemra does therefore not intend to change its current investment policy. According to Vervoord the organization managed to limit its losses slightly by selling their shares just before the heights of the financial crisis. At the beginning of 2008 30% of the organizations total capital of approximately € 300 million Euro was invested in shares. This is now reduced to 20%.

(Source: Het Financieele Dagblad, 26 May 2009; http://www.fd.nl/artikel/11660074/artiest-levert-10-auteursrechten-beursverlies-buma)