Annual Report 2010

Annual report Buma/Stemra 2010

2 AnnuAl report 2010 â ContentS

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Buma Harpen Gala 2010

AnnuAl report 2010 | Buma/Stemra 3 â ContentS

This is Buma/sTemra

The facts:- There is no European market for online music

licenses even though everyone is said to be striving

for a uniform European market.

- The lengthy formation of the cabinet has delayed

the discussion about the renewal of copyright

by a year.

- The exploitation of Phono-Mechanical rights has,

to all intents and purposes, become unfeasible, not

just at Buma/Stemra but also at other societies

in Europe.

- The courts have endorsed that downloads from

illegal sources are allowed under Dutch law.

- The cabinet-Rutte is inflicting cutbacks of c 200

million on Dutch culture, in addition to that

the VAT rate on admission tickets for cultural

performances is going from 6% to 19%.

The opportunities:- Buma/Stemra boasts 20,000 music authors and

with that is a factor of significance.

- It is the copyright organization with proportionately

the highest distribution.

- It goes the furthest to make the exploitation of

copyright for music authors as flexible as possible.

- It has a top 3 position in the field of cost efficiency

among the collecting societies in Europe.

- Buma Cultuur is the most important promoter of

Dutch copyright.

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AnnuAl report 2010 | Buma/Stemra 5

TaBle of conTenTs

Key figures 6

Buma Five-year plan 8

Stemra Five-year plan 9

Report of the management boards 11

Directors’ Report 15

Buma financial statements for 2010 29

Stemra financial statements for 2010 51

Management boards and directors 71

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Key figures

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2006 2007 2008 2009 2010

106.002 112.770 113.575 119.972 129.432

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2006 2007 2008 2009 20100

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80

2006 2007 2008 2009 2010

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2006 2007 2008 2009 2010

Turnover development Buma/Stemra Turnover in € millions

Results Buma/StemraResults in € millions

Breakdown of 2010 turnover in percentages – StemraBreakdown of 2010 turnover in percentages – Buma

0.5% Performing Rights Online

Licensing

7.5% Performing Rights Abroad

8.5% Sales outlets

8.7% Cable

12.7% Workplaces

12.1% Catering

14.2% Stage

35.8% Radio & TV Performing Rights

1.4% Mechanical Rights Online

Licensing

9.0% Home Copy / Lending Rights

10.6% Mechanical Rights Abroad

17.7% Special Licensing /

Private Labels

14.4% Radio & TV Mechanical Rights

46.9% Biem Phonomechanical

Rights / Central Licensing

Members and participants

Foreign organisations

Fund for cultural and social purpose

Distribution by Stemra Royalties in € millionsDistribution by Buma Royalties in € millions

Associations and participants

Foreign organisations

Administrative costs deducted

Financial results

Result on ordinary activities

Operating results Stemra (S) Buma (B)

(S)

(B)

48,421 51,576 45,041 40,680 35,662

119,972 129,432 140,004 136,440 140,346

AnnuAl report 2010 | Buma/Stemra 7 ã ContentS

Staffing levels as per year-end Buma/StemraAs per year end

Turnover segmentation Buma(x € 1,000)

2010 2009 2008 2007 2006

radio & tV performing rights 50,228 51,329 52,541 45,714 42,286Stage 19,899 21,513 20,799 18,249 18,354 Catering 17,015 14,663 14,710 15,744 15,431Workplaces 17,799 13,777 15,215 15,143 12,620 Sales outlets 11,940 11,716 11,901 11,427 10,605 performing rights online licensing 757 893 946 840 564Cable 12,168 12,396 13,035 12,292 11,387 performing rights Abroad 10,540 10,153 10,857 10,023 8,725 140,346 136,440 140,004 129,432 119,972

Turnover segmentation Stemra(x € 1,000)

2010 2009 2008 2007 2006

Biem phonomechanical rights / Central licensing 16,684 18,229 19,866 24,599 23,917Special licensing / private labels 6,306 5,656 8,860 9,930 7,064radio & tV Mechanical rights 5,138 7,266 6,211 5,276 6,124Mechanical rights online licensing 515 1,314 1,219 1,664 1,081Home Copy / lending rights 3,223 3,533 4,184 4,269 4,727Mechanical rights Abroad 3,796 4,682 4,701 5,838 5,508 35,662 40,680 45,041 51,576 48,421

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Buma five-year planfor 2006 – 2010

Buma five-year plan for 2006-2010(x € 1,000)

2010 2009 2008 2007 2006

Distribution Members and participants 78,925 81,537 80,406 73,015 66,497 Foreign organizations 47,427 44,010 44,336 39,703 42,739

Distributed in the reporting year 126,352 125,547 124,742 112,718 109,236

to be distributed at year-end 162,211 156,536 153,816 151,991 136,798

Turnover 140,346 136,440 140,004 129,432 119,972 Profit and loss account Income 3,357 3,140 3,033 2,709 2,828 expenses -16,919 -16,381 -15,195 -14,659 -14,772 operating result -13,562 -13,241 -12,162 -11,950 -11,944 Financial result 8,496 8,322 -7,782 10,429 9,392 result on ordinary activities -5,066 -4,919 -19,944 -1,521 -2,552 Key index figures total turnover index (2006 = 100) 117.0 113.7 116.7 107.9 100

operating costs index (2006 = 100) 114.5 110.9 102.9 99.2 100

operating costs as % of turnover 12.1% 12.0% 10.9% 11.3% 12.3%

Distributed in the reporting year as % of (turnover last year -/- result on ordinary activities last year) 96.1% 104.6% 97.5% 96.0% 98.8%


sTemra five-year plan for 2006 – 2010

Stemra five-year plan for 2006-2010(x € 1,000)

2010 2009 2008 2007 2006

DistributionAssociates and participants 31,297 37,989 38,700 46,071 45,444 Foreign organizations 5,453 6,276 8,198 7,946 8,079

Distributed in the reporting year 36,750 44,265 46,898 54,017 53,523

to be distributed at year-end 38,755 40,863 45,438 49,175 51,332

Turnover 35,662 40,680 45,041 51,576 48,421

Profit and loss accountIncome 3,700 4,377 4,728 5,418 5,248 expenses -8,241 -8,975 -9,726 -9,446 -9,652

operating result -4,541 -4,598 -4,998 -4,028 -4,404

Financial result 4,821 4,187 -1,132 4,312 4,325

result on ordinary activities 280 -411 -6,130 284 -79

Key index figurestotal turnover index (2006 = 100) 73.6 84.0 93.0 106.5 100

operating costs index (2006 = 100) 85.4 93.0 100.8 97.9 100

operating costs as % of turnover 23.1% 22.1% 21.6% 18.3% 19.9%

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ã ContentSAnnuAl report 2010 | Buma/Stemra 11

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12 AnnuAl report 2010 ã ContentS

Financial statements

It is our pleasure to hereby present you with the financial

statements of the Vereniging Buma (Buma Association)

and the Stichting Stemra (Stemra Foundation) for the

financial year 2010. Both sets of financial statements have

been audited by KPMG Accountants N.V. and been issued

with an unqualified report. We recommend you to approve

the financial statements for 2010 of Buma and the financial

statements for 2010 of Stemra, including the board of

directors’ proposals, and to discharge the management

board and board of directors.

Meetings

The management boards met formally six times in the year under review. The Supervisory Board met three times.

During the management board meetings a large number of topics were discussed. All of these topics were dealt with in one or more meetings. Some of them will develop into proposals which will reach the members in 2011. Matters which were discussed concern such things as complaints development, housing, the establishment of the Podcasts working group (in which charges for the use of music in podcasts are determined), the progress that the Pastors working group is making and the start of the joint basic administration (in which the users’ data is shared between Buma and Sena). The management boards have also taken note of the proposals of the College of Copyright Supervision with regard to sound management and transparency. They have considered these proposals in their deliberations.

Flexibility

The management boards have thoroughly gone into proposals to adjust the regulations. This is necessary as the

members have emphatically brought to the fore their desire for making a greater flexibility possible in the way in which royalties are apportioned in the composers part. More and more frequently our rights owners work with so-called co-writes. Several composers and lyricists are then involved in the creation of a musical work. Within the current regulations each writer receives an equal share in the royalties but the desire is that the authors themselves can come to agreements about that, in which the publishers share stays the same. The management boards have also approved a proposal about a so-called Royalty Free Service in which the promotion of own music for non-commercial use on the own website and on CD and DVD may occur free. Furthermore, the management boards have accepted the proposal concerning flexible rights transfer

Online. The appraisal concerning various sorts of use of music was also discussed. It was decided that the Management Committe on Distribution will present a clear proposal in 2011.

The future of Stemra

In the past management year a great deal of attention was given to the future of Stemra. The issue is well-known: the sale of

music carriers is dropping at a high tempo and is not being replaced by income from the use of music on the internet. This latter is the result of a lack of adequate legislation for the protection of copyright in the digital world. Furthermore, the royalties from the commission percentage, according to the Cannes-agreement, Stemra may charge, do not offset the cost of maintaining the administration in a financially justified way . All the sister organizations of Stemra in Europe have the same problem. Even large societies like Gema and MCPS no longer manage to carry out the exploitation and administration of Phono-Mechanical rights in a financially healthy way. The Management Board have had many discussions in the past year to see where favourable solutions lie. It is clear that, no matter what, the administrations are going to have to be combined. There are good arguments, both from the side of the industry as of the societies, to keep up the administration of Phono-Mechanical rights in Europe. The current year should make clear if this leads to a long-term solution in which a healthy operational management of this administration is ensured.

Politics

One of the matters which has started to move is that the Ministry of Justice has published a rough draft of Authors

Rights Contracts. The only concrete step that has been taken in European, the context is that the European parliament accepted the Gallo-Report at the end of September. This report recognizes the problem of the illegal use of music, for instance, on the internet and the fact that measures must be taken against this. It is now a question of waiting to see what the European Commission is going to do with the recommendations of the report. We anxiously await State Secretary Teeven’s spearhead memorandum, which was announced in 2010, in which the position of copyright in the digital world will also be discussed.

reporT of The managemenT Boards


Social-Cultural

In several management board meetings the deduction percentage for social-cultural was discussed. The balance

that is available for this purpose must, for instance, be able to cover the (conditional) obligations that the fund entered into. Furthermore, the annual allocations and withdrawals are brought in balance. Therefore it was decided to reduce the deduction percentage in three steps from 10% to 8%.

The organization

The promotion of the importance of copyright and the role that Buma plays in this as well as implementing the PR-

policy have been on the agenda several times. The management boards decided, after lengthy deliberation, to set up a PR & Communication department for both Buma Cultuur and Buma. The management boards have ascertained that the policy of Buma Cultuur as formulated in 2009 has successfully been taken up in 2010 with vigour. During the managerial discussions on the budget and allocation for Buma Cultuur, specific support of certain genres, such as jazz was also discussed. In the light of the development of the outlook for Buma Cultuur, attention will also be given to the way in which genres, which are commercially interesting and those which are not are supported, also partly in relation to any possible pay back opportunities of an event on the one hand and cultural aspects on the other. The management boards have also spoken about the possibility of undertaking the activities of Musi©opy.

Second phase outsourcing

In accordance with the original decision making concerning outsourcing, the board of directors started the second phase of

the outsourcing project in the second half of 2010. In this phase the operations are transferred from Prague to India. As of 2011 operations for Buma/Stemra in Prague ceased and all activities take place under the responsibility of Accenture in India.

The General Members’ Meeting

The Joint General Members’ Meeting of the Vereniging Buma (Buma Association) and the Meeting of Affiliates of the

Stichting Stemra (Stemra Foundation) took place in Amsterdam on May 17, 2010. As introduced in 2009 the public part again had a number of workshops and seminars with various topics that are of interest to the visiting rights owners. At the meeting the financial statements of Buma and Stemra were presented by Mr Cees Vervoord for the last time in his capacity as chairman of the Board of Directors and he gave his explanatory remarks on the implemented policy.

The members gave their approval for the financial statements of Buma 2009 and the financial statements of Stemra 2009 and discharge management board and board of directors for the implemented policy. Also the meeting agreed to an age limit and term of office for members of the management board of Stichting Stemra (Stemra Foundation), the Supervisory Board and the management Committees. This means the upper age limit of candidates is fixed at 70 years. At the meeting the upper limit of the term of office for the Supervisory Board was fixed at three terms of a maximum of 4 years. The age limit for the management board at Buma remains unchanged.

Appointments

On March 22, 2010 an extra general members meeting took place. The meeting agreed to the appointment of Mr Hein

van der Ree as chairman of the Board of directors of Buma/Stemra. Mr Cees van Rij was appointed by the meeting as statutory co-director and vice-chairman of the board. The Joint General Members’ meeting of May 17 elected Mr Tom Peters as a member of the management board and reappointed Mr Maurice Mensink and Mr Paul van Brugge. The Meeting of Affiliates elected Mr Jochem Gerrits as a member of the management board of Stemra and re-elected Mr Hans Kosterman and Mr René Smit. During a reception at Artis on June 19 Buma/Stemra bid farewell in an appropriate way to Cees Vervoord as chairman of the board of directors. Mr Vervoord held this position from 1994 to May 2010. During the festive gathering Mayor Spekreijse of Lochem pinned on the decoration which goes with his appointment as Companion of the Order of Oranje-Nassau. The management boards realize that the organization under the leadership of the new chairman of the board of directors is faced with a heavy task. The organization is in a precarious phase in an environment in which copyright is respected less and less and in which the income position of rights owners and affiliates is continually being meddled with. However, the board of directors know however that they are confident of an organization that with the greatest possible degree of scrupulousness and efficiency does its work, as the figures in the financial statements show. The management boards of Buma and StemraHoofddorp, April 6, 2011

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inTroducTory remarKs

At the end of 2010 an amount of c 162.2 million is

available for distribution to Buma rights owners. This is

well over c 5 million more than there was to distribute at

the end of 2009. At Stemra has per the end of 2010 an

amount of c 38.8 million to distribute compared to c 40.9

million at the end of 2009.

Whereas the turnover of Buma has risen, Stemra has been

deteriorating for a succession of years, 2010 was no

exception to this. Not just Stemra, but all the other societies

in Europe have great difficulty in financially maintaining the

exploitation of Phono-Mechanical rights. Therefore intensive

consultations are taking place with societies in order to

come to a common solution.

At the moment of writing this annual report the final details

are being settled for a new Cannes-agreement. With that the

compensation percentage for Phono-Mechanical rights

remains virtually unchanged. This agreement is valid up to

and including 2013 and offers some repose regarding the

compensation percentage that Stemra can count on.

The Key figures 2010

General

Turnover Buma increases, Stemra decreases

The state of affairs per product sector at Buma and

Stemra provided a higher turnover at Buma in 2010 and,

once again, a substantially lower turnover at Stemra. In

general. The increase in turnover at Buma is partly the result

of a number of settlement of accounts with music users

which also relate to preceding years.

Settlement of accounts from preceding years plays a decisive role in the achieved turnover

In general licenses, Buma (catering, stage, work and sales

outlets) the economic crisis has, for the second successive

year, clearly had an impact on the turnover invoegen of

Buma. Especially catering has been considerably hard hit,

which is apparent in an increase in bankruptcy cases. Fewer

music users also means less contributions to Buma.

Also the turnover at Stage ar below expectations. The

organizers of great events have achieved substantially lower

turnover through the lack of large acts in 2010. In former

years performances by artistes as U2, Madonna, Coldplay,

but also those of Marco Borsato and Guus Meeuwis were

great sources of income, in 2010 there were significantly less

of this kind of event. The fact that the decrease at Stage

remained limited and nevertheless generated a turnover of

c 19.9 million, is due to the extra efforts of the increase of

small-scale and often one-off events. In 2010, for the first

time, technology, which automatically traces websites that

have information about events, was used to track and

investigate relevant performances.

The advance of cable viewers disappointing

In the Cable sector we see that in the past two years more

and more more households have switched to a form of digital

television. At the end of 2008 that applied to approximately

50% of families, in 2010 that percentage increased to 62%. The

remaining part use a satellite dish or have a connection with

a telephone company. For Buma/Stemra the growth in the

number of subscribers to cable television on digital channels

is especially of importance, the advance last year lapsed

disappointingly. The majority of cable viewers still watch

analog channels. This is an important fact because this leads

to the redistribution of turnover among the groups of rights

owners in the cable collective. Through this the share for

Buma will decrease. Moreover, because the consumer price

index was negative per January 1, 2010, no growth could be

realised by means of the index adjustments.

Broadcasting companies provide far fewer mechanical recordings than formerly

One would assume that through the growing use of music

on radio and television that here, of all places, the turnover

would increase. On the other hand however, broadcasting

companies record much fewer broadcasts for the long-term.

This has to do with other technical storage systems in

which music is called up from a central server.

Consequently far fewer copies of each musical work are

recorded. Also the broadcasts themselves are recorded in

another way. More and more frequently the music, for

example for a television documentary, is removed in storage.

This also leads to a diminished contribution, because, in

this way, no Stemra-license is necessary for the recording of

own productions.

direcTors’ reporT


In 2010 the Dutch entertainment market once again disappointing

In 2010 the income from the use of music on the internet

remained zero, this as a result of the lack of protection of

copyright in the digital world. Furthermore, at the end of

2009, the Online sector was negatively affected by the

discontinuation of the charges for background music. In

addition to this in 2010 it was decided not to charge

websites for embedded content, in view of the discussion

about a definite regulation for this form of online use of

music. Another important reason of the large decrease of

income in the Online sector is the fact that various

publishers have withdrawn their mechanical rights from

almost all societies. Through this, the income from both

existing and new streaming and download contracts have

been more than halved.

The market disappoints

The Dutch entertainment market in 2010 was once again

disappointing. The sales and turnover, both in money

and numbers, taken as a whole, have dropped by more than

10 per cent in nearly all the product groups.

The whole market dropped by 12.7 per cent and consequently,

ended up for the first time under the turnover level of c 1

billion. In 2009 a turnover of c 1.1 billion was achieved,

whereas in 2010 this amounted to c 970.6 million. The music

market shrank by well over 15 per cent to c 218.1 million. In

2009 this turnover was still c 258.4 million. Only the sales of

digital albums and digital singles rose by respectively

22.7 and 4.7 per cent. The above-mentioned, emerged from

figures that trade association NVPI published at the

beginning of 2011. Analysis of the figures show that the

national product has done relatively well. The success

of Caro Emerald, Marco Borsato, Nick & Simon and Jan

Smit have contributed to this.

New Cannes agreements

After months of delays a new Cannes agreement,

Cannes-III, was established in 2010. This encompasses

retroactively the years 2009 and 2010. The agreement

regulates the percentages which the societies for Phono-

Mechanical rights may retain as remuneration for their

administrative activities and distribution of royalties. The

two parties involved, are the international music publishers

on one hand and the organizations for Phono-Mechanical

rights in West Europe on the other. In both years Stemra

obtained a compensation percentage of 7.325 for this

turnover category. For the first time the operation of the

Cannes agreement has been extended to music DVDs. A

higher compensation percentage has been agreed on for

this, namely 9.325 per cent, because more rights owners are

involved in this and it means a more complex

administration for the societies.

New Cannes agreement entered into for the period up to 2013 inclusive

At the beginning of 2011 the final negotiations were

conducted for the Cannes-IV agreement. The new agreement

will last for a period of three years, from January 1, 2011 up to

and including December 31, 2013. As regards the percentages

Cannes-IV will be a virtually unchanged continuation of

Cannes-III. This new agreement means that there will be

certainty for three years about the compensation percentage

on which Stemra can count on.

Hereafter, it is described how the above-mentioned factors

have affected the figures for Buma and Stemra for 2010.

Buma

With a turnover of c 140.3 million in 2010 the royalties

from copyright exploitation have come out slightly

higher than that of the record year 2008. It is too premature

to draw the conclusion from this that Buma is once more on

the growth path, after the slight relapse of 2009 (turnover

c 136.4 million).

In the largest sector, Performing Rights Radio & TV, the

turnover has decreased slightly to c 50.2 million compared

to c 51.3 million in 2009. With this it is maintaining the level

of last year when a non-recurring income was still

incorporated in the turnover. Also in the Stage sector there

is a question of a decrease, of c 21.5 million in 2009 to

c 19.9 million in 2010.

Turnover Buma has risen to over d 140 millionThe turnover of the Catering sector increased by c 2.3

million from c 14.7 million in 2009 to c 17.0 million in 2010.

This is remarkable in view of the economic recession in

catering. The higher turnover also chiefly has to do with the

settlement of accounts over a number of years. Furthermore

marketing was intensified and the joint invoicing which was

set up with other collecting societies (CSs) under the name


SCAN resulted in an increase in the number of invoices. The

Workplaces sector also achieved a higher turnover. Also here

it is a question of one-off income from preceding years

through which the turnover figures stand out favourably

compared to preceding years. The turnover increased from

c 13.8 million in 2009 to c 17.8 million in 2010.

The Sales Outlets sector achieved a practically unchanged

turnover of c 11.9 million in 2010 (2009: c 11.7 million). The

sector Performing Rights Online Licensing turnover

decreased to c 757,000 compared to c 893,000 in 2009.

The Cable sector realised a turnover of c 12.2 million

compared to c 12.4 million in 2009. In Performing Rights

Abroad the turnover increased slightly to c 10.5 million

(2009: c 10.2 million). A positive boost came from the extra

use of tunes & jingles from Dutch music creators by

European broadcasting stations.

Stemra

The decrease in turnover at Stemra was not brought to a

halt in 2010. Whereas in 2009 c 40.7 million income was

secured, in 2010 it was c 35.7 million. The greatest decrease

was at Mechanical Rights Radio & TV, with a turnover of c 5.1

million in 2010 compared to c 7.3 million the year before. The

largest sector is Phono-Mechanical rights Biem/Central

Licensing. Here the turnover was c 16.7 million (2009: c 18.2

million). The decline is directly connected to the caving in of

the sale of physical music carriers.

The annual decline last year was still somewhat compensated

by the unexpected sale of Michael Jackson CDs.

Slump in turnover chiefly through decrease at Radio & TV

With the amount of c 6.3 million the Special Licensing/Private

Labels sector booked a slightly higher turnover (2009: c 5.7

million). The income from Mechanical Rights Online

Licensing was decimated from c 1.3 million in 2009 to

c 515,000 in the year under review. Here we see the

consequences of the fact that the large music publishers have

taken away the exploitation of their repertoire for online from

the European societies, and therefore also from Buma/

Stemra. However, the most important cause of the decrease

in turnover is the lack of a earning model for use of music on

the internet. In Homecopy/Lending Rights the turnover is

dependent on a third party. This went down to c 3.2 million

(2009: c 3.5 million). Mechanical Rights Abroad noted a

decrease from c 4.7 million in 2009 to c 3.8 million in 2010.

The development of the results

The revenue from investments is of important value in

the financial foundation of the organization. The

practice of investing available funds under conditions, came

into effect on the basis of a management decision in the

nineties. The management board was confronted with the

fact that funds which the organization receives from the

exploitation of rights cannot immediately be distributed to

the rights owners. The administration needs time to gather

all data and to arrive at a correct distribution. It often takes

many months before certainty is gained about the exact use

of musical works by licensees, certainly if it concerns users

overseas. In the last decade of the previous century it

became clear that it was more sensible, under conditions, to

invest received funds that were waiting for distribution,

rather than just paying them into a, mediocre yield, deposit

account. That applied then, and it still does now. To that end

an investment policy was formulated in which many risks

were reduced. On the understanding that of course no

investment is completely without risk.

Shares and bonds are valued in the balance sheet against

the prices on the stock exchange on the balance sheet date.

The results derived from this are incorporated in the

revaluation reserve. As far as the balance of the revaluation

reserve permits, in addition to the dividend received on

shares and – from 2006 – in addition to the received interest

on the fixed interest portfolio, a so-called standard return

can also be entered in the financial results. This

methodology fits in with the objective of Buma/Stemra that

the well-considered investment results on shares and fixed

interest securities over the years show as constant as

possible course in the operating statement.

Since then the revenue from the investments is used to cover a

considerable part of the costs of the organization . In retrospect

it can be ascertained that this, against the background of the

compensation which societies received for their activities, was

a wise decision. The administration costs which we at Stemra

can charge within the framework of, among others, the

Cannes-agreement have not covered costs for years.

In the meantime the investment proceeds have become a

stable second source of revenue. They contribute to the fact

that, of the European societies, Buma has the lowest level of

costs year after year and consequently also the highest

distribution ratio. The following record reflects the netto costs

as percentage of the achieved turnover in the year 2009 (figures

for 2010 are not yet available):

direcTors’ reporT


Buma operates with the lowest cost percentages in the branch

The results of the investments is entered in the profit and

loss account of Buma and Stemra under the item financial

results.

Profit and loss account Buma

Besides the reported turnover from the exploitation of

rights of c 140.3 million in 2010, revenue was also

received of c 3.4 million (2009: c 3.1 million). This revenue

partly emanated from the administrations of other

collecting societies which Buma takes care of.

The expenditure at a higher turnover has largely remained

unchanged and came to c 16.9 million. In 2009 the

expenditure amounted to c 16.4 million.

The exploitation result amounted to c 13.6 million negative

(2009: c 13.2 million negative). The financial results

(including the changes revaluation) improved slightly and

amounted to c 8.5 million (2009: c 8.3 million), as a result of

which ultimately c 5.1 million costs were debit to the

turnover compared to c 4.9 million in 2009.

Before Buma goes on to the distribution of the collected

funds, after processing revenue and expenditure, a portion

is added to the Fund for Social and Cultural purposes. This

occurs in accordance with a decision of the management

board which is reconfirmed each year. The addition for 2010

is fixed at 8.5% (2009: 9%) of the amount of the Netherlands

royalties available for distribution. With that the allocation

amounted to c 10.2 million (2009: c 10.4 million).

Profit and loss account Stemra

The turnover of Stemra in year under review, amounted

to c 35.7 million, once again a sharp decline compared

to 2009 (c 40.7 million). Also the revenue went down and

amounts to c 3.7 million (2009: c 4.4 million). In comparison

to expenditure of c 8.2 million (2009: c 9.0 million). From this

an exploitation result of c 4.5 million negative remains. In

2009 this was c 4.6 million negative. The financial result

(including the revaluation changes) amounts to c 4.8 million.

What remains is a result from ordinary activities of

c 280,000 positive compared to c 411.000 negative in 2009.

This result will have an influence on the financing of the

negative appropriated reserve which was set up in 2008.

Stemra has completely redeemed the loan from Buma

Balance Buma and Stemra

An important decision which has an influence on the

balance of both Buma and Stemra is that in the year

under review, Stemra completely redeemed the loans from

Buma and BSO/BSA for a total of c 55.7 million. This amount

is deducted from the current account with Stemra.

disTriBuTion

General

In two years’ time Buma hopes to celebrate its 100th

anniversary. The Vereniging Buma (Buma Association) was

founded in 1913 by composers and music authors who, with

the advent of the radio, were not able to monitor the use of

their musical works themselves. For that purpose they

founded the Vereniging Buma (Buma Association) to whom

they handed over the exploitation of their Performing

Rights.

When later on the sale of records and other music carriers

also boomed, the association members set up the Stichting

Stemra (Stemra Foundation). Stemra targeted on the

exploitation of Phono-Mechanical rights. Later the minister

of Justice deemed Buma as the sole collecting society which

may deal with the exploitation of music rights in The

Netherlands. Since then the organization has worked under

the supervision of the Ministry.

The exploitation of rights and the collection and distribution

of the resulting royalties from that is the most important

task of the organization. It is important to realise that the

distribution which is justified each year in the annual report,

relates to what is distributed to rights owners in the year

under review, primarily on the basis of the turnover royalties

which were realised the year before.

Buma has as per December 31, 2010 an amount of c 162.2

million on the balance that is available for distribution,

Stemra has an amount of c 38.8 million. The distribution of

this will largely take place in 2011.

The distribution for Buma which took place in October 2010,

is related to the amount that was available for distribution

to the rights owners on December 31, 2009. For Buma that

was c 156.5 million and for Stemra c 40.9 million.



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For Buma the available amount for distribution has risen, for Stemra it has fallen

Distribution Buma once again higher

At the beginning of the year under review there was

c 156.5 million to distribute. In addition to this, during

2010 an amount of c 132.0 million became available for

distribution. From that, the amount that was distributed in

2010 is deducted. On balance at the end of 2010 c 162.2

million is available for distribution to the rights owners of

Buma. This is largely distributed in 2011. The construction of

these amounts is described in the Notes on the balance of

Buma on page 42 of this annual report.

Distribution Stemra is lower

At the beginning of the year under review there was an

amount of c 40.9 million to distribute. During 2010 an

amount of c 34.6 million is available for distribution. From

that, the amount that is distributed in 2010 is deducted. On

balance at the end of 2010 c 38.8 million is available for

distribution to the rights owners of Stemra. This is

distributed in 2011. This is nearly c 2 million less than the

comparable amount over 2009. The composition of these

amounts is described in the Notes on the balance of Stemra

on page 62 of this annual report.

The only turnover online that is not increasing is that of music

Protection of copyright

The expectation from years ago that legal downloads

would amply surpass the sale of physical carriers has,

for the time being, turned out to be an illusion. As far as that

is concerned, the Netherlands is one of the most infamous

music markets in the world. Research by the organization of

the international record industry, IFPI, over 2010 shows that

the online market in The Netherlands is bringing up the rear

in Europe and the world. Whereas, in Denmark and Great-

Britain respectively, approximately 25 per cent and 20 per

cent of the music sales take place online, in our country it is

only 6 to 8 per cent. For the whole of Europe this percentage

is on average, 15 per cent of the turnover. By way of

comparison: in the US currently 43 per cent of the music

sales take place online. PriceWaterhouseCoopers has

another relevant observation about the Dutch market. They

observe that the music sales are steadily dropping and that

this is in sharp contrast with the turnover which internet

service providers realise and the amounts that are spent on

advertising and direct mailings on internet. Each year since

2006 these numbers are again substantially higher than

those of music sales.

The efforts of tracing organization BREIN to trace as many

sites as possible which distribute music without licences

and to have legal action taken are indeed successful but still

very troublesome. BREIN (a collaboration of rights and

producer organizations in our country) manages to take

effective action against online infringements of copyright,

but for each shut down illegal website a few new

alternatives crop up.

Home Copying Scheme frozen

In Dutch copyright it states that the copying of music is

allowed provided that this is done for own use or for study

purposes. To compensate the rights owners for this the

legislator devised the Home Copying Scheme, based on a

compensation on blank carriers and other objects which can

be used to store music. Through this music authors,

composers and publishers were somewhat compensated

financially for the loss of income which they suffered as a

result of the Homecopy exception. There are two major

problems with this scheme.

In the Home Copying Scheme the recordable CD is the most modern music carrier

In the first place the scheme has not been adjusted anymore

since 2003. Since then the rights owners have, to no avail,

been zealous advocates of the implementation of the Home

Copying Scheme on modern music carriers such as

MP3players, smart phones, hard disc recorders, memory

sticks, recordable DVDs and other new recording media. But

last year, via an Order in Council, the government froze the

scheme for another three years. Not only has the scale of

charges been left unchanged, but also modern music

carriers fall outside the scheme for another three year. The

compensation is imposed on carriers which are hardly ever

sold anymore. The income from the Home Copying Scheme

is, not surprisingly, also halved.

Bill on supervision pushed through

This year the parliamentary considerations over the bill

that regulates the supervision of the collecting societies

direcTors’ reporT


must be rounded off. It is certain that the bill will mean an

expansion and strengthening of government supervision.

Discussion in parliament about the future of copyright delayed by one year

Authors Rights Contracts

Another political topic caused a lot of turmoil in 2010.

During the summer a rough draft for the regulation of

the Authors Rights Contracts was made public. With this

regulation the Netherlands wants to follow the example of

a number of other European countries, where it appears to

work well. The rough draft outlines the rules which must

be observed when entering into contracts between authors

and the exploitant of his work. With this the legislator

wants to improve the negotiating position of the author in

relation to the licensee. The regulation will not just apply

to music authors but for the creators of all works protected

by copyright. Licensees are, according to Authors Rights

Contracts, not just the recording companies, but also

broadcasting companies, software companies, publishers,

film and television producers etc.

The proposal Authors Rights Contracts jeopardizes publishers’ investments in acts

Brussels

In the meantime Europe is becoming more important by

the day for national copyright and for the regulating of the

exploitation and administration of this right. It must be

stated that the European Commission in 2010 has also not

yet taken action to get a clear picture of European copyright

in the digital age, let alone that an effective regulation is

reached. While technology is racing like a storm through the

various sectors, the music author is left to fend for himself.

neW iniTiaTives

FlexCo further fleshed out

In 2010 the concept of FlexCo became more concrete.

Flexible Collective Management is an initiative that meets

the desire of rights owners to be able to deal more flexibly

with the transfer of rights to Buma/Stemra. In particular

young composers and lyricists want to be able to exploit

their music themselves via internet. There is already a pilot

running with Creative Commons. In the past year it was

decided that music authors have the possibility to do the

online exploitation of their works whether or not carried out

by Buma/Stemra. In the latter case the exploitation risk

comes to lie by the rights owner. This means for example

that Buma/Stemra will no longer take action against sites

that make illegal use of their works. The members meeting

of May 2011 will receive a proposal about this.

Buma Works hard on greater flexibility for rights owners

Another part where Buma/Stemra offers more flexibility is

allowing variant distributions. Now it is so that in the Buma/

Stemra regulations fixed distributions are employed. For an

increasing number, in particular younger authors and

composers the fixed distribution is no longer satisfactory.

Hits are more and more frequently co-writes; the sum of

contributions from various authors. Within the current

regulations more authors can be registered for a work, but

in that case they each receive an equal percentage of the

Buma share. The members meeting of May 2011 can look

forward to a proposal in which it is possible that within the

authors share variant agreements can be made among the

authors themselves.

collaBoraTion

Pastors working group: concrete agreements

Pastors working group made good progress in 2010 and

moreover achieved important results. The working

group, officially Working Group Improvement Collection

Royalties, was started in 2008. Within the working group

consultations between the collecting societies and the

business community take place, combined in VNO/NCW

and MKB The Nederland (Small and Medium Sized

Enterprises the Netherlands). In 2010 a great amount of

work was accomplished.

Pastors Working group achieves important results


The working group is engaged in five matters:

1. The setting up of a central basic registration. The aim is

that copyright organizations arrive at a joint database

with all the user data. At the closing of this annual

report the planning was that the basic registration will

go ahead in spring 2011. This starts in any case with

Buma, SENA and Videma. Also other organizations can

join this.

2. Joint negotiating. Via mutual understanding from both

CSs and user-representatives to endeavour to establish

parameters and make regulations. Thus a new regulation

for live-performances was thoroughly discussed. This

has also come into being.

3. Disputes and complaints settlement. A number of

preparations have been made, but the definite

interpretation of the regulation will depend on the

Supervision of Collecting Societies Act which must be

dealt with in parliament within the foreseeable period.

4. A hallmark for rights organizations. Definite agreements

have been made about this. Buma meets the

requirements.

5. Electronic invoicing. This was realised at the beginning

of 2010 with the start of the Service Centrum Authors-

and Naburige Rights (Service Centre Copyright & Related

Rights) (in short “SCAN”).

In December the working group decided to freeze the

charges for 2011. So that this year a number of sensitive

discussion points can be settled in peace and quiet, such as

the adjustment of the parameters by Buma and SENA plus

the adjustment of charges so that they are better attuned to

the requirements in the market. The working group has

given itself time till October 1, 2011 for this purpose, so that

the business community knows in time which changes

come into effect in 2012.

Tasks transferred to SCAN

Except for one production function all the tasks of the

department Individual Licences of Buma have been

transferred to the Stichting Service Centrum Authors and

Naburige Rights (Service Centre Copyright & Related Rights)

SCAN. SCAN does not serve as a new rights organization but

acts purely as an administration service centre for various

rights organizations. At the moment these are Buma, SENA

and Videma. On behalf of these three organizations SCAN

now takes care of the administration, invoicing and collection

for music licences.

SCAN has been in operation since 2008. In 2010 it further

improved and supplemented the joint database. Last year

SCAN consisted of 60,000 accounts. In 2011 it will reach

100,000 accounts. Furthermore, in 2010 for the first time, the

invoicing was done jointly. It was found that SCAN

contributes to greater efficiency in the administrative process.

The aim is that as many as possible rights organizations and

music users place their invoicing and collection with SCAN as

a result of which the costs per invoice for the participating

CSs can decrease. In addition, this year the field organizations

from the participating organizations will be combined.

SCAN grows to 100,000 accounts this year

The organiZaTion

Social-Cultural: allocation of € 10.2 million

The most important task of the social-cultural activities

of the organization is the promotion of Dutch music and

the arrangement of a supplementary pension for rights

owners. The activities are financed from the allocation to

the Funds for Social & Cultural purposes. The level of the

addition to this fund comes from the agreements which

were made within the CISAC, the international umbrella for

Copyright organizations.

In the financial year 2010 c 10.2 million (2009: c 10.4 million)

was added to the fund. As a percentage of the turnover this

is 8.5% compared to 9% in 2009. The management board has

namely decided that in the case of growth of the turnover,

Buma does not have to automatically stay the addition at

the same percentage of the turnover.

The aim is to bring Buma to the attention of the public, politics and industry the whole year longIn 2010 Buma Cultuur received from this addition c 3.6 million.

The “Toeslag Ernstig” (Surcharge Serious), the provision which

is used for supporting of activities in the category Serious

Music, amounted to c 2.4 million in 2010. Other cultural

objectives were assigned c 0.7 million.

Furthermore in 2010 c 3.9 million was assigned to support the

social objectives of the organization. It concerns the Buma

Social Fund that was assigned c 1.5 million. To Other Social

c 2.4 was distributed. For this item it concerns contributions on

behalf of the AENA superannuation scheme and the Publishers

superannuation scheme.

direcTors’ reporT


Buma Cultuur (Buma Culture) reaches its targets

In 2010 Buma Cultuur implemented its policy plan 2009 -

2012. Buma Cultuur’s aim is to promote and support

Dutch music copyright in the broadest sense. With this the

organization has a unique place in the Dutch cultural

climate, in which music from The Netherlands takes up an

increasingly important role. In foreign countries the

attention for music from The Netherlands is greater than

ever. Buma Cultuur has been able to contribute a lot to this.

Broadening of the field of activity

Buma Cultuur streamlined its own organization in 2010

to be able to work more efficiently and effectively. This

has led to a broadening of the initiative package, so that all

the relevant genres are supported and illuminated. Buma

Cultuur sees it as its task to make certain that rights owners

have the feeling that the cultural activities are relevant and

actually supportive of the genres in which they are active.

The genres that Buma Cultuur concentrates on, are:

1. Dutch -language (Folk)

2. Pop/rock/alternative

3. Dance/urban/world-music

4. Jazz/cabaret/contemporary/applied music/World-music

One of the first priorities in 2010 was the broadening of the

field of activity. This led to the launching of two new events,

BUMA NL and Buma Rotterdam Beats. BUMA NL is the

showcase-festival for Dutch language songs. For two days

BUMA NL, with more than 500 professionals and artistes,

formed a cross section of Dutch language music and the

Dutch language industry. The BUMA NL Award show drew

a large public.

Buma Rotterdam Beats is the new showcase and seminar

event for Dutch urban music, a genre that produces many

hits and with which Dutch composers score internationally.

Buma Cultuur successfully launches two new events

Bonds with media partners

Another priority in 2010 was the expansion of the

collaboration with media partners at various events.

Thus the Buma Harpen Gala in 2010 was, for the second

time, broadcast live by the TROS. Also BUMA NL and Buma

Rotterdam Beats received a lot of media interest. The

collaboration with media partners at other large events as

Eurosonic Noorderslag, the Amsterdam Dance Event and

the Annie M.G. Schmidtprijs is enhanced and extended.

Thus Buma on Tour was extensively heard on 3FM. There

were also many sets to be heard on this station from DJs

who performed during the 15th Amsterdam Dance Event.

The whole year through Buma Cultuur will create media

attention and couple the name Buma to as many media and

programmes as possible. In addition, Buma Cultuur is

setting its sights at calling attention in public opinion, in

politics and industry to Dutch music and music copyright.

Buma Cultuur is aiming with that not just at the

professionals but also at the public at large.

Focus on top-marketing

Finally Buma Cultuur has discontinued a number of

activities because allocation of resources was not optimal

or the coupling to its own objective got insufficient attention.

Thus participation in Music Export was stopped. Instead of

that Buma Cultuur targets on top-marketing support, the

promotion abroad of authors who have already built up a

reputation in the Netherlands. Buma Cultuur does not pay

towards the costs of artistes tours abroad but offers support

with the promotion to do with it. It consequently has more

the character of sponsoring than subsidizing. In exchange for

this the artistes promote Buma, in interviews and other

things. In this way in 2010 acts such as Caro Emerald and

Wouter Hamel are effectively supported. The tightening up of

the policy was also noticeable at the Buma Harpen Gala held

in March 2010. The accent at the Gala was more on the music

author and composer than on the performing artiste. Also

the publicity that the event drew was extremely great. Thus

both the NOS News and the RTL News devoted a lot of space

to the Buma Harpen Gala, both in the broadcasts on the

evening of the presentation as in the morning broadcasts the

day after. Also many other programmes, such as RTL

Boulevard, dedicated various items to the event. The 2011

edition which was held on March 3 had as a new element

that it was no longer a professional jury that awarded the

prizes, but the Buma-Affiliates themselves.

DisputesThe Arbitration board

Since 2006 rights owners at Buma/Stemra with

complaints concerning decisions from the Board

of Directors and management board can invoke a

dispute. A special Arbitration board makes a ruling about

the complaint.


The Arbitration board is made up of three members who are

appointed by the members meeting of Buma/Stemra. The

Arbitration board consists of an independent chairman (a

lawyer in the field of copyright), and two Buma/Stemra-

rights owners. The Disputes settlement is accessible to all

authors and music publishers who are affiliated to Buma/

Stemra. With that the Arbitration board of Buma/Stemra is

the professional body for a rights owner with a concrete

complaint about a decision from the management board

and the board of directors through which he/she

individually and directly is affected in his/her interests. The

ruling of the Arbitration board serves parties as a binding

recommendation, unless the judge in a concrete case rules

differently. In 2010 the Arbitration board made a ruling in

two matters. In the one case the Arbitration board decided

in the complainant’s favour and in the other case not. In

both cases it was about the implementation of the double

claim procedure when two rights owners claim the same

(part of a) work.

The Standing Committee on Plagiarism (SCP) The Plagiarism Committee makes simple settlements of

disputes possible. Currently five musicologists and two

professors serve on the SCP. The SCP came into being in 1967

as an extra service to our members. The background is that

members who are in dispute with each other about the

origin and originality of a musical work do not immediately

have to turn to the courts. In the meantime the SCP has

turned out to be an extremely useful addition to the service

of Buma/Stemra; the procedure is efficient, fast, practical

and relatively inexpensive.

In 2010 the SCP dealt with two complaints. In both cases it

was established that there was no question of plagiarism.

Mediation

As of 2010 Buma/Stemra facilitates, under certain

conditions, the possibility of solving disputes via

mediation. At least one of the parties involved must be a

Buma/Stemra rights owner and Buma/Stemra itself should

not be a party in the conflict.

To the present day no use has yet been made of the above-

mentioned possibility.

Musi©opy at Stemra

Stichting Musi©opy (Musi©opy Foundation) intends to

cease its activities in 2011. Stemra has offered to carry

on the activities of Musi©opy. Through this one service desk

comes into being for collective music arrangements at the

Stichting Stemra (Stemra Foundation).

Since 1995 Musi©opy has served the interests of music

authors and music publishers in the field of the copyright

aspects of song texts and musical notations, and the

licensing of the re-use of these works. Musi©opy had too

little income to be able to work as a professional

organization. Furthermore, it was difficulty for them to

reach the choirs, brass bands, orchestras and wind and

percussion bands. Buma/Stemra has the necessary systems

which makes the administration easier and more efficient.

In addition to this our organization can draw on contacts

with the groups mentioned.

With the activities of Musi©opy, Stemra can offer interested

parties an extra service. At the moment of writing, the

agreement with all the large interested parties is not yet

completely finalized, as a result of which the take-over

of Musi©opy is not yet definitely settled.

Licenses for online use of music possible

Since May 2010 music users at Buma/Stemra can also apply

online for licences for online use of music. Consequently,

we are able to offer our clients more ease and efficiency and

achieve greater transparency. Most users of this service

currently come from the world of webcasting: the live

broadcasting of image and sound material via internet.

Through this new service these users can also arrange their

licences themselves.

PINO realises ultimate goal

The term PINO became an important term in 2010 for all

rights owners and affiliates. PINO stands for Paper Is No

Option: the name of the operation which was started in 2009

to make communication with members, including the

settlement of accounts, completely digital. In 2010 the project

was successfully rounded off. 95 per cent of the affiliates

receive their data via internet. The remaining five per cent

mostly consists of older people who have no computer or

who find it troublesome to deal with. They, of course, still

receive their pieces by post.

direcTors’ reporT


a looK ahead 2011

The current year promises, on various points, to give

more clarity. If we look at the political front, then State

Secretary Teeven will come with his bill concerning the

supervision of collecting societies. Also the report of the

Gerkens committee will be dealt with in the Lower House of

the Dutch Parliament and the Authors Rights Contracts is on

the agenda.

In Brussels a lot of interest is shown in the new directive

from the European Commission concerning copyright and

the online possibilities of exploiting musical works. Though

whether the directive will see the light this year is still the

question.

2011 promises to be the year of clarity

The future of Stemra is also waiting for clarity this year.

Consequently, the current talks with “sister” organizations

in Europe and the publishers are of overriding importance.

Only if we succeed in bundling administrations is the

exploitation of Phono-Mechanical rights feasible in the

long term.

Three factors are important for the turnover which can be

achieved this year. The first is that a new Cannes-agreement

is entered into for a duration of three years up to and

including 2013. Therein, the international music publishers

assent to a virtually unchanged deduction percentage for

the exploitation of Phono-Mechanical rights.

The second factor is that at the beginning of 2011 an

agreement is reached on a new contract with Koninklijke

Horeca The Netherlands (Royal Dutch Catering).

The third factor is that as of December 31, 2010 the contracts

with the commercial tv-stations, NPO and Kabel expire. The

negotiations about that, which began last year, will have to

be wrapped up this year.

Achieving results is determined by whatever requirements

the cabinet stipulates for the investment policy of the CSs.

To all appearances it looks as if the room to invest will be

limited. If that happens, then the investment revenue is no

longer an extra source of income to cover the costs and is

therefore also no longer a stable cornerstone under our

financial household. That will again be to the cost of the

height of the distribution to rights owners.

The strategy of Buma/Stemra is aimed at:

• Lobby for legislation for the protection of copyright in

the digital world

• Enhancing service direction (improve complaints

process)

• Improved and more frequent communication with our

members, extension portal functionality)

• Maintaining the position as licenser of the world

repertoire

• Maximization of the turnover

• Top-3 position amongst the CSs in Europe in the field of

cost efficiency

• The strategy of Stemra focusing on the creating

international collaboration with as aim the efficient

administration of Mechanical Rights

With the steps that we have taken in 2010 and taking into

consideration the expected market circumstances we

anticipate being able to further realise these strategic targets

in 2011.

The Board of directors Buma/Stemra

Hein van der Ree (chairman)

Cees van Rij

Wieger Ketellapper

Hoofddorp, April 6, 2011



financial sTaTemenTs for 2010 Buma

toonzetters 2010

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Buma Balance sheeT

Buma balance sheet as per 31 December 2010After appropriation of the result (x € 1,000)

31 December 2010 31 December 2009*

asseTs Fixed assets

Intangible fixed assets (1)

Company information system - 40

- 40

Tangible fixed assets (2)

Hardware/computer equipment 414 683

other operating assets 90 121

504 804

Financial fixed assets (3)

Securities 202,846 159,781

202,846 159,781

Current assets

Accounts receivable

Debtors 8,151 4,528

Current account balances (4) 2,619 47,052

taxes and dividends 344 966

other receivables and prepayments (5) 9,261 10,898

20,375 63,444

Cash at bank and in hand (6)

Deposit accounts 16,944 23,030

other cash at bank and in hand 18,912 3,179

35,856 26,209

259,581 250,278

liaBiliTies

reserves

Continuity reserve (7) 1,855 2,367

Appropriated reserve (8) - -3,253

Revaluation reserve for financial fixed assets (9) 10,796 9,878

12,651 8,992

Provisions (10) 11,174 12,275

23,825 21,267

Long term liabilitiesFund for cultural and social purposes (11) 17,168 17,557

17,168 17,557

Current liabilitiesroyalties to be distributed (12) 162,211 156,536

Creditors 6,237 6,922


taxes and social security contributions 405 303

other accruals and deferred income (14) 3,851 4,291

218,588 211,454

259,581 250,278

* Adjusted for comparison


Buma profiT and loss accounT

Buma profit and loss account for 2010 (x € 1,000)

2010 2009*

income

Administrative costs charged 2,151 1,940

entrance fees and annual allowances 604 549

other income 602 651

3,357 3,140

expenses

personnel expenses (15) 8,151 8,150

Housing expenses 1,141 1,160

Depreciation and amortisation 406 656

other expenses 7,221 6,415

16,919 16,381

operating result -13,562 -13,241

Financial result (16) 8,496 8,322

result on ordinary activities -5,066 -4,919

exceptional income 512 -

exceptional expenses -512 -

Result -5,066 -4,919

Result appropriationresult allocated to appropriated reserve 3,253 3,254

result deducted from royalties to be distributed -8,319 -8,173



Buma cash floW sTaTemenT

Buma cash flow statement(x € 1,000)

2010 2009*

Cash flow from operating activitiesturnover 140,346 136,440

Distribution incl. administrative costs charged -126,352 -125,547

Changes in Fund for cultural and social purposes -389 -512



Investment costs, including charge-ons 175 346

Changes in indemnification obligation 15 23

Changes in provisions -1,116 -607

Withdrawal from continuity reserve -512 -

Changes in accounts receivable (excl. Interest due) 43,312 -602

Changes in current liabilities (excl. royalties to be distributed) 1,459 1,378

44,771 776

Cash flow from business operations 43,782 -1,666

Interest received on securities 5,578 7,069

Financial expenses - -527

Interest paid on securities -314 -420

5,264 6,122

Cash flow from operating activities 49,046 4,456

Cash flow from direct investment activitiesInvestments in tangible fixed assets -240 -175

Cash flow from investing activities -240 -175

Cash flow from indirect investment activitiespurchase of securities -84,670 -28,883

repayments/sales 45,511 39,236

Cash flow from indirect investment activities -39,159 10,353

Changes in cash at bank and in hand 9,647 14,634



general

Buma Association’s objectivesThe Association aims to promote both the material and

immaterial interests of authors and music publishers, with

its ensuing activities taking place on a non-profit basis.

The Association participates in the implementation and

promotion of various activities in this context to achieve

its objective.

Principles for the valuation of assets and liabilities and determination of the resultThe principles adopted for the valuation of assets and

liabilities and determination of the result are based on

historical costs unless otherwise explained.

Unless stated otherwise, assets and liabilities are stated at face

value. Income and expenses are allocated to the period to

which they apply.

The figures of 2009 are re-classified for comparison (with the

figures of 2010).

Accounting principles for the translation of foreign currencyTransactions denominated in foreign currency are translated to

euros at the applicable exchange rate on the transaction date.

Monetary assets and liabilities denominated in foreign

currency are translated to euros at the exchange rate applicable

on balance sheet date. Exchange rate differences are taken to

the profit and loss account. Non-monetary assets and liabilities

denominated in foreign currency that are valued on the basis

of historical costs are translated at the applicable exchange

rate on the transaction date.

Principles of consolidationIn view of their transparent structure, Stichting Buma/Stemra

Obligatiefonds and Stichting Buma/Stemra Aandelenfonds are

included in the Buma financial statements by means of

proportional consolidation. Assets and liabilities, as well as

income and expenses, are included in proportion to the

participating interest. On the basis of the information provided

in the notes, no separate financial statements for Buma are

included.

Intangible fixed assetsThe intangible assets concern the expenses for the new

business information system to support the primary business

processes. These are valued at historical cost less cumulative

investment expenses or amortisation. These investments

are charged to the profit and loss account over a period of

three years.

Tangible fixed assetsThe valuation of tangible fixed assets takes place on the basis of

historical cost less cumulative depreciation.

Depreciation is calculated as a percentage of the purchase price

according to the straight-line method on the basis of the expected

useful life.

The following expected useful life terms are used:

• Hardware/Computer equipment 3 years

• Other operating assets 3 - 7 years

Accounts receivableAccounts receivable are stated at nominal value less a

provision for bad debts.

Financial fixed assets The securities included under financial fixed assets are listed

shares, bond funds, and (convertible) bonds. Securities are

stated at market value as at balance sheet date.

Revaluation reserve for financial fixed assets Price gains/losses arising from the valuation of securities at

market price are not directly taken to the trading account, but

are first included in the revaluation reserve for financial fixed

assets (hereinafter: ‘revaluation reserve’). To the extent that the

revaluation reserve is insufficient, the deficit is charged to the

result.

Each year, the size of the revaluation reserve needed to absorb

price fluctuations is determined by the management board in

consultation with its asset managers. If the revaluation reserve

is larger than deemed necessary, this surplus is eligible for

addition to the royalties to be distributed.

Financial result and standard returnDividends are accounted for in the period in which they are

made payable, interest income is accounted for in the period to

which it relates.

Insofar as the balance of the revaluation reserve, less a possible

appropriate reserve for (un)realised gains or losses arising

from changes in market prices, leaves room for this, a ‘standard

return’ is included in the financial result, in addition to any

receivable share dividend and interest on bond funds. In the

calculation of the standard return, the dividend and interest

already paid out are taken into account, and only the difference

between the dividend/interest received and the standard

return is settled with the revaluation reserve.

The standard return is calculated as a percentage of the

average value of the shares and bond funds over the financial

noTes To The Buma Balance sheeT and profiT and loss accounT


year, and comprises the effective return on 5-year euro

government bonds at the end of the financial year plus a risk

mark-up for shares. The difference between the standard

return and the dividend received on shares or interest received

on bond funds is withdrawn from the revaluation reserve,

if possible.

Due to progressive changes in legislation and regulations, the

system of applying a standard return is no longer regarded as

a generally acceptable principle.

However the system of standard return fits in with the

requirement that the recorded investment results on shares

and fixed-income securities show the most even development

possible in the profit and loss account over the years. For this

reason the management board and directors have decided to

continue the system of standard return.

Continuity reserve The continuity reserve’s aims include guaranteeing the

continuity of the work. It also serves to fulfil obligations in

respect of third parties, in particular with regard to distribution

of the royalties yet to be distributed in accordance with the

financial statements. This reserve furthermore serves to level

out unwanted fluctuations in the amounts available for

distribution, resulting, among other things, from domestic and

international pressure on turnover, as well as continuing

changes in the distribution of rights.

Fund for cultural and social purposesFor the benefit of this fund, in accordance with Article 29(3) of

the Articles of Association, each year a percentage defined by

the management board on the recommendation of the board of

directors, with a maximum of 10%, is deducted from the Dutch

royalties available for distribution.

The amounts deducted are reserved by the management board

for payments to institutions or organizations whose purpose

is to represent the idealistic or material interests of composers,

lyricists and music publishers, or who otherwise promote

Dutch music. The fund for cultural and social purposes is

classified as liability, because the fund is never available to

the organization.

Appropriated reservesAppropriated reserves are the parts of reserves that

management has set aside for a special purpose. In this case,

it concerns the appropriated reserve for (un)realised gains/

losses arising from changes in market prices. For more detailed

information on this appropriated reserve, please refer to the

notes to the balance sheet.

ProvisionsProvisions are measured at either the nominal value of the

estimated expenditure required to settle liabilities and losses,

or the present value of that expenditure.

A provision is mentioned in the balance sheet when there is:

• a legal or constructive obligation as a result of a past

event, and

• of which a reliable estimate can be made, and

• it is probable a cash outflow is necessary to settle the

obligation.

The provision for reorganization costs is related to the estimated

costs of redundancy.

The long-service awards provision is a provision for future

long-service awards. The provision is the present value of future

benefits to be paid for long-service awards.

Determination of the resultIncome and expenses are accounted for in the year to which

they apply. The result is determined by calculating the

difference between the balance of realised income and

expenditure and the financial result for the year. The balance

of the profit and loss account is allocated/deducted from the

royalties to be distributed and/or the reserves by means of

profit appropriation.

Financial expensesThe operating costs of the system for the collection of

programme data, Fingerprinting, are no longer classified as

financial expenses, but from 2010 directly charged to the

operating result.

Pension plansObligations for contributions to defined contribution pension

plans are recognised as an expense in the profit and loss account

when the contributions are due.

Turnover In the financial statements, the turnover in royalties is added

to the royalties distributed. Buma includes the exploitation of

performing rights in turnover, insofar as these relate to the

financial year, can be determined in a reliable manner, and

there is reasonable certainty that the revenue is collectible.

TaxWith regard to Buma, the Dutch tax authorities stipulated in an

agreement dated November 6, 2001, determining the legal

relationship between the parties, that Vereniging Buma is liable

to pay corporation tax. This agreement was extended at the

end of 2008 for a period of three years, and is valid until

noTes To The Balance sheeT and profiT and loss accounT


December 31, 2011. Foreign withholding tax available for set-off

and Dutch dividend tax may be deducted from the tax due by

virtue of this agreement determining the legal relationship

between parties. A tax item is only included in the financial

statements if corporation tax is still owed after deduction of

the foreign withholding tax available for set-off.

Accounting principles for cash flow statementThe cash flow statement is drawn up using the indirect method.

Use of estimatesDrawing up the financial statements requires management to

form opinions and make estimates and assumptions that

influence the application of principles and the reported value

of assets and liabilities, and of income and expenses. The

estimates and the associated assumptions are based on past

experience and various other factors that are considered

reasonable in view of the circumstances.

The outcome forms the basis for the opinion on the carrying

value of assets and liabilities that does not emerge clearly from

other sources.

The actual results may differ from these estimates.


noTes To The Buma Balance sheeT as per 31 decemBer 2010

Business information system

Actual cost as per 1 January 2010 6,958

Cumulative investment costs -6,918

Balance sheet value as per 1 January 2010 40

Changes during financial year:

Investments -

Amortisation -40

-40

Actual cost as per 31 December 2010 6,958

Cumulative amortisation -6,958

Balance sheet value as per 31 December 2010 -

Amortisation in number of years on average: 3

(1) Intangible fixed assets The changes in the intangible fixed assets can be specified

as follows

(x € 1,000)


Hardware/ Other

Computer- operating-

equipment assets Total

Actual cost as per 1 January 2010 3,085 5,263 8,348

Cumulative depreciation -2,402 -5,142 -7,544

Balance sheet value as per 1 January 2010 683 121 804


Investments 207 33 240

Depreciation -476 -64 -540

-269 -31 -300

Actual cost as at 31 December 2010 3,292 5,296 8,588

Cumulative depreciation -2,878 -5,206 -8,084

Balance sheet value as per 31 December 2010 414 90 504

Depreciation in number of years on average 3 7

the depreciation accounted for in the statement of

movements is partly charged on, as the assets in question

are used by Stemra or sub-tenants. the amounts charged

on to Stemra and the sub-tenants is for both € 0.1 million.

(2) Tangible fixed assetsThe changes in the tangible fixed assets can be specified

as follows: (x € 1,000)


2010 2009

Balance sheet value as per 1 January 159,781 157,608

Changes during the financial year:

Acquisitions 84,670 28,883

repayments / sales -45,511 -39,236

price movements 3,906 12,526

43,065 2,173

Balance sheet value as per 31 December 202,846 159,781

(3) Financial fixed assetsThe changes in the financial fixed assets can be specified as follows:

(x € 1,000)

Securities

31 December 2010 31 December 2009asseTs

Fixed assets

Financial fixed assets 254,006 251,695

Other assets 15,823 73,440

269,829 325,135

liaBiliTies

Participants’ account 269,395 324,752

Current liabilities

Creditors 434 383

269,829 325,135

the fully-combined Financial statements of Stichting Buma/Stemra Obligatiefonds (BSO) [Buma/Stemra bond Fund Foundations] and

Stichting Buma/Stemra Aandelenfonds (BSA) [Buma/Stemra equity Fund] can be represented in condensed form as follows:

(x € 1,000)


Securities and bonds of Vereniging Buma are carried at market value.

Valuation differences on bonds and shares are charged or

credited to the revaluation reserve for financial fixed assets.

the total face value of the bonds amounted to € 47.6 million (2009:

€ 41.9 million) compared to a market value of € 49.1 million (2009:

€ 42.3 million). the reduction in the face value of € 41.9 million to

€ 47.6 million is on the one hand the effect of the conversion of part

of the fixed-income securities to bond funds and on the other hand

an increase in interest in the Stichting Buma/Stemra obligatiefonds

of 16.4%. this increase of 16.4% is the result of the sale of

participations by Stemra worth € 69.5 million (repayment of loan

in current account to Buma € 55.7 million, repayment of loan in

current account to BSo and BSA € 13.3 million, increase cash Stemra

€ 0.5 million).

Buma’s securities have been placed in Stichting Buma/Stemra

obligatiefonds and Stichting Buma/Stemra Aandelenfonds. the

foundations are proportionally consolidated in Buma’s financial

statements at an average percentage of 79.9% (2009: 63.5%).

At the end of 2010 the interest is changed from 63.5% to 79.9%.

For the result implies that the percentages are used as applied for

2010 (63.5%). the participations give Vereniging Buma a 79.9%

(2009: 63.5%) interest in Stichting Buma/Stemra Aandelenfonds

and a 79.9% (2009: 63.5%) interest in Stichting Buma/Stemra

obligatiefonds at year end 2010.


(5) Other receivables and prepayments

(x € 1,000) 31 December 2010 31 December 2009

Cable fees due 5,782 5,086

Interest due 1,160 917

other receivables and prepayments 2,319 4,895

9,261 10,898

(6) Cash at bank and in handFor the rent of the office building, a bank guarantee has been issued for

€ 0.5 million. All the other cash at bank and in hand is freely available.

(7) Continuity reserveThe changes can be specified as follows 2010 2009(x € 1,000)

As per 1 January 2,367 2,367

Allocations - -

Withdrawals -512 -

As per 31 December 1,855 2,367

During the year a withdrawal is made that refers to the completion

of the streamlining of the organization which started in the previous

years. the withdrawal of € 0.5 million was recognized through the

profit and loss account (exceptional income and expenses).

(8) Appropriated reserveThe changes can be specified as follows: 2010 2009(x € 1,000)

As per 1 January -3,253 -6,507

Allocations 3,253 3,254

Withdrawals - -

As per 31 December - -3,253

(4) Current account balancesthe loan of € 55.7 million (2009 € 43.8 million) from Buma to

Stemra is completely redeemed and is reduced on the current

account balance with Stemra. the loan is subject to the euribor

three-month rate.

Further notes about the settlement of this current account balance is

mentioned at the financial fixed assets.

€ 6.5 million of the negative result in 2008 is set aside by means

of result appropriation by the management board and the board of

directors in the appropriated reserve, in order to not fully settle the

effects of the stock exchange decline in 2008 with the 2008 collection

year. In accordance with the intention of 2008, 50% of the appropriate

reserve of 2008 was balanced with the distributions of the 2009

collection year and the remaining 50% is settled with the distributions

of the 2010 collection year.


Provision for long-service awardsthe provision for long-service awards is a provision for future long-

service awards, calculated on the basis of actuarial assumptions with

regard to indexation and life expectancy.

Provision for reorganization coststhe expectation is that the provision for estimated severance

payments will largely be settled in 2011.

Provision for SFB scheme annual allowancethe provision for annual SFB allowances concerns a provision for the

actual obligations by virtue of the annual allowances paid to (former)

authors and publishers and their next of kin through the Stichting

Sociaal Fonds Buma (SFB).

Although the obligations have been included provisionally, there is

a firm intention to meet the obligations. the part of the provision

for which no subsidy has been committed to the SFB as yet is

recognised. the expected remaining term of the provision is until the

end of 2022, and it has been calculated on the basis of the nominal

amounts of the annual allowances with non-actuarial assumptions

with regard to indexing and life expectancy. the provision was

formed from the Fund for cultural and social purposes; releases are

part of the deductions and taken to the Fund.

Provision for obligation to indemnifyAs a party to the agreements concluded with cable operators

concerning copyright arrangements for relaying programmes from

broadcasting companies, Buma has undertaken obligations with

regard to copyright claims that could be enforced against cable

operators by third parties, not represented in the matter by Buma.

In respect of obligations to indemnify arising from these agreements,

the provision for obligations to indemnify amounts to 3% of the

monies collected. the addition/withdrawal takes place to the debit/

credit of the collection.


(9) Revaluation reserve for financial fixed assetsThe changes in the revaluation reserve for financial fixed assets can

be specified as follows: 2010 2009(x € 1,000)

As per 1 January 9,878 -

(un)realized gains/losses arising from price changes 3,907 12,526

Withdrawal to the credit of the financial result to standard return -2,989 -2,648


(10) ProvisionsThe changes in the provisions can be specified as follows:

(x € 1,000) Balance as per Additions Withdrawals Balance as per

1 January 2010 2010 2010 31 December 2010

long-service awards 419 198 -198 419

reorganization costs 157 - -18 139

SFB scheme annual allowance 11,133 - -1,098 10,035

obligation to indemnify 566 581 -566 581

12,275 779 -1,880 11,174

the (un)realized gain in securities amount to € 3.9 million (2009:

12.5 million) and are taken directly to the revaluation reserve for

financial fixed assets. the results on shares, (convertible) bonds and

bond funds are stated at a standard return. the percentage for 2010

was 6.2% (2009: 6.6%) for shares and for fixed-income securities 3.7%

(2009: 4.1%). the withdrawal for the benefit of the financial result at a

standard return was € 3.0 million (2009: € 2.6 million).


the withdrawal from the available amount to be allocated for

distribution of royalties in the netherlands and the resulting addition

to the Fund is set by the board of directors at 8.5% (2009: 9%).

€ 10.7 million of the total fund has a short term characteristic.

2010 2009

As per 1 January 17,557 18,069


Withdrawals -10,601 -10,907


(11) Funds for cultural and social purposes

The changes can be specified as follows:

(x € 1,000)


2010 2009

royalties to be distributed at the beginning of the year 156,536 153,816

royalties turnover 140,346 136,440

Changes in royalties to be distributed -8,319 -8,173

Available for distribution 288,563 282,083

Distributed in the reporting year:

Members and participants 67,440 69,943

Foreign organizations 46,549 43,269

Fund for cultural and social purpose 10,212 10,395


Distribution incl. administrative costs charged 126,352 125,547

Royalties to be distributed at the end of the year 162,211 156,536

of the available amount to be processed for distribution in 2011,

€ 4.7 million will be added to the indivisible rights (2009: € 4.5

million, distributed in the 2010 payment).

the negative result for 2010 amounts to € 5.1 million (2009:

€ 4.9 million negative). In accordance with the decision of 2008,

€ 3.3 million was allocated to the appropriated reserve and

€ 8.3 million (2009: € 8.2 million) was deducted from the royalties

to be distributed.

(12) Royalties to be distributed (x € 1,000)

2010 2009


Indivisible rights 4,715 4,469

Changes in royalties to be distributed -8,319 -8,173

Became available for distribution during the year 136,742 132,736

to be distributed at the beginning of the year 156,536 153,816

Available * 132,027 128,267

Distributed -126,352 -125,547


*Excluding indivisible rights which have already been accounted

for in the opening balance sheet

Available for distribution Buma(x € 1,000)



2010 2009

radio & tV performing rights 50,228 51,329

Stage 19,899 21,513

Catering 17,015 14,663

Workplaces 17,799 13,777

Sales outlets 11,940 11,716

performing rights online licensing 757 893

Cable 12,168 12,396

performing rights Abroad 10,540 10,153

140,346 136,440

Distribution of Buma’s turnover(x € 1,000)

2010 2009

live entertainment 16,335 18,407

Mechanical entertainment 38,345 32,138

radio 5,868 5,848

television 7,637 7,556

Film 2,403 1,965

Serious categories 3,222 3,219

Cable 10,859 10,982

Satellite 31,321 32,073

International 10,540 10,153

Fund for cultural and social purposes 10,212 10,395

136,742 132,736

The amount available for distribution (including addition for indivisible

rights) is allocated to the different categories as follows:

(x € 1,000)


31 December 2010 31 December 2009

Sister companies abroad 26,064 25,464

Specific obligations 14,719 14,210

Buma members and participants 752 613

Current account Stemra 949 -

other 3,400 3,115

45,884 43,402

(13) Current account balances (x € 1,000)

the amounts owed to sister companies abroad were largely settled

at the beginning of 2011.

the specific obligations are obligations to foundations with

social-cultural purposes:

• Buma Cultuur € 5,309 (2009: € 4,317)

• AenA € 5,071 (2009: € 5,265)

• Sociaal fonds Buma € 4,339 (2009: € 4,628)

31 December 2010 31 December 2009

third-party cable right owners 1,882 2,848

Holiday allowance/annual leave 793 754

other liabilities and accruals 1,176 689

3,851 4,291

(14) Other liabilites and accruals(x € 1,000)



off-Balance sheeT commiTmenTs

Partially pledged bond portfolioIn accordance with the decision of the management board, at the

end of 2002, part of the bond portfolio of Stichting Buma/Stemra

obligatiefonds amounting to € 27.5 million was pledged as security

to InG Bank n.V. in connection with a cash facility needed for normal

operations.

Longterm financial liabilitythe financial liability with regard to the business accommodation in

Hoofddorp was entered until April 30, 2012.

the annual rent for Buma/Stemra together amounts to € 1.9 million

of which approximately 40% will be charged to third parties.

In the current composition, the annual amount for the leasing of cars

by Buma/Stemra is € 0.3 million. the liability for terms longer than

one year is € 0.4 million.

the financial liability for the rent of the printers was entered until

May 1, 2013. the annual rent amounts to € 0.1 million.

Buma/Stemra entered into a contract allowing Accenture to perform

a large portion of Buma/Stemra’s back office activities from 2007

until March 31, 2017. the resulting financial obligation amounts to

€ 18.2 million for the remaining duration of the contract, assuming

consistent volumes.

the off-balance sheet commitments of € 21.5 million can be

summarised as follows:

• less than 1 year: € 5.1 million

• between 1 and 5 years: € 15.7 million

• longer than 5 years: € 0.7 million


2010 2009

Salaries 8,473 7,868

Social security contributions 1,030 940

pension contributions 1,032 862

other personnel expenses 2,652 3,207

13,187 12,877

Charged /compensated to third parties -5,036 -4,727

8,151 8,150

expenses

(15) Personnel expenses (x € 1,000)

the average number of employees during the reporting

year was 173 employees (2009: 165 employees) which

corresponds to an average of 166.5 Fte (2009: 154.6 Fte).

this includes:

• average 4 employees (2009: 1 employee) are charged to SCAn, which corresponds

to an average of 4.0 Fte (2009: 0.8 Fte)

• employees who work partly for Stemra, on the basis of which part of the costs are

charged on to Stemra

• 1.0 Fte which is charged to other affiliated foundations

Salary management board Buma and registered Directors Buma/Stemra for the year 2010 (x € 1,000)

Management BumaFee for 12 members of the management board Buma

(incl. expense allowance) € 95.4

Registered Directors Buma/StemraH.G. van der ree salary € 200.0

(from May 1, 2010) pension charges € 40.4

C. van rij salary (incl. variable reward) € 233.9

pension charges and car € 55.2

C.p. Vervoord, former chairman

of the board of Directors salary (incl. variable rewards) € 379.2

(till August 1, 2010) pension charges € 56.1

of the amounts mentioned above 70% is recognized in the financial statements of Vereniging Buma and 30% in the financial statements of

Stichting Stemra.

In preparing the financial statement until 2009 we used the exemption under Article 383 paragraph 1, title 9 BW2.

noTes To The Buma profiT and loss accounT for 2010


2010 2009

Interest income and other incomeFixed-income securities

Interest received on bonds 1,605 1,957

Shares

Share dividend received 3,509 3,755

5,114 5,712

Mutations revaluation reserve

Withdrawal from revaluation reserve for the benefit

of the financial result at a standard return 2,989 2,648

other interest income and similar income 707 909

total income from investments 8,810 9,269


Interest expenses and other costs -314 -420

8,496 8,322

(16) Financial result(x € 1,000)

Financial expensesthe operating costs of the system for the collection of programme

data, Fingerprinting, are no longer classified as financial expenses,

but from 2010 directly charged to the operating result.


oTher informaTion

To: The Board of Directors and the general meeting of affiliates to Vereniging Buma

independenT audiTor’s reporT

We have audited the accompanying financial statements 2010

of Vereniging Buma, Hoofddorp, which comprise the balance

sheet as at December 31, 2010, the profit and loss account for

the year then ended and the notes, comprising a summary of

the accounting policies and other explanatory information.

Management’s responsibility Management is responsible for the preparation of the financial

statements in accordance with the accounting policies selected

and disclosed by the entity, as set out in the notes to the

financial statements. Furthermore, management is responsible

for such internal control as it determines is necessary to enable

the preparation of financial statements that are free from

material misstatement, whether due to fraud or error.

Auditor’s responsibilityOur responsibility is to express an opinion on these financial

statements based on our audit. We conducted our audit in

accordance with Dutch law, including the Dutch Standards on

Auditing. This requires that we comply with ethical require-

ments and plan and perform the audit to obtain reasonable

assurance about whether the financial statements are free

from material misstatement.

An audit involves performing procedures to obtain audit

evidence about the amounts and disclosures in the financial

statements. The procedures selected depend on the auditor’s

judgment, including the assessment of the risks of material

misstatement of the financial statements, whether due to

fraud or error. In making those risk assessments, the auditor

considers internal control relevant to the entity’s preparation

of the financial statements in order to design audit procedures

that are appropriate in the circumstances, but not for the

purpose of expressing an opinion on the effectiveness of

the entity’s internal control. An audit also includes evaluating

the appropriateness of accounting policies used and

the reasonableness of accounting estimates made by mana-

gement, as well as evaluating the overall presentation

of the financial statements.

We believe that the audit evidence we have obtained is

sufficient and appropriate to provide a basis for our

audit opinion.

OpinionIn our opinion, the financial statements are prepared, in all

material respects, in accordance with the accounting policies

selected and disclosed by the entity, as set out in notes to the

financial statements.

Basis of accounting and restriction on distribution and useWe draw attention to notes to the financial statements, which

describes the basis of accounting. The accounting policies used

are selected and disclosed by the entity. Our opinion is not

qualified in this respect.

Amstelveen, April 6, 2011

KPMG ACCOUNTANTS N.V.

R.J. Groot RA


suBsequenT evenTs

Profit appropriationFor Buma, the result for 2010 will be deducted from the

royalties still to be distributed.

Then, according to the assessment of the reserve, it will be

determined to what extent funds will have to be added to

or deducted from this. This movement will also be credited

or charged to the royalties to be distributed.

Proposal of the board of directorsAs shown in the financial statements, which we prepared in

accordance with Article 26(2) of the Articles of Association,

the board of directors proposes deducting c 8.3 million of the

negative result of c 5.1 million from the royalties to be

distributed and allocating c 3.3 million to the reserve. (in

accordance with the decision made in 2008).

The proposal has already been incorporated in the 2010




financial sTaTemenTs for 2010 sTemra

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sTemra Balance sheeT

Stemra balance sheet as per 31 December 2010After profit appropriation (x € 1,000)


asseTs

Fixed assets

Tangible fixed assets (1)

Hardware/computer equipment 210 224

210 224

Financial fixed assets (2)

Securities 51,159 91,915

51,159 91,915

Current assets

Accounts receivableDebtors 4,868 2,791


taxes and social security contributions 885 1,762

other receivables and prepayments (4) 288 426

10,221 7,491

Cash at bank and in hand (5)

Deposit accounts 2,781 12,724

other cash at bank and in hand 3,524 1,924

6,305 14,648

67,895 114,278

liaBiliTies

Reserves

Foundation capital 1 1

Continuity reserve (6) 5,760 5,929

Appropriated reserve (7) - -1,300

Revaluation reserve financial fixed assets (8) 5,561 5,683

11,322 10,313

Provisions (9) 213 379

11,535 10,692

Current liabilitiesroyalties to be distributed (10) 38,755 40,863

Creditors 932 986


other accruals and deferred income (12) 12,055 12,094

56,360 103,586

67,895 114,278



sTemra profiT and loss accounT for 2010

Stemra profit and loss account for 2010(x € 1,000)

2010 2009

income


entrance fees and annual allowances 604 549

3,700 4,377

expenses

personnel expenses (13) 5,018 4,951

Housing expenses 761 774


other expenses 2,192 2,813

8,241 8,975


Financial result (14) 4,821 4,187

result from ordinary activities 280 -411

exceptional income 169 -

exceptional expenses -169 -

Result 280 -411

Profit appropriationresult allocated to appropriation reserve 1,300 1,300

result deductions from continuity reserve - -721

Changes in royalties to be distributed -1,020 -990


sTemra cash floW sTaTemenT

Stemra cash flow statement(x € 1,000)

2010 2009

Cash flow from operating activitiesturnover 35,662 40,680

Distribution -36,750 -44,265



Investment costs, including charge-ons -99 -270

Changes in provisions -166 -51

Withdrawal from continuity reserve -169 -

Changes in accounts receivable (excl. interest due) -2,868 -583

Changes in current liabilities (excl. royalties to be distributed) -45,118 10,121

-47,986 9,538

Cash flow from business operations -53,779 1,471

Interest received on securities 3,299 3,570


Interest paid on securities -709 -704

2,590 2,734

Cash flow from operating activities -51,189 4,205

Cash flow from direct investment activitiesInvestments in tangible fixed assets -157 -102

Cash flow from investing activities -157 -102

Cash flow from indirect investment activitiespurchase of securities -10,790 -17,842

repayments/sales 53,793 23,819

Cash flow from indirect investment activities 43,003 5,977

Changes in cash at bank and in hand -8,343 10,080


general

Stemra Foundation’s objectivesThe Foundation’s objective is to represent and promote both

the tangible and intangible interests of music authors and

publishers and other copyright owners, in particular with

regard to mechanical reproduction rights. The Foundation’s

other goals are exercising and maintaining mechanical

reproduction rights for participating authors, participating

publishers, as well as other authors and copyright owners.

The Foundation’s participates in the implementation and

promotion of various activities in this context to achieve

its objective.

Principles for the valuation of assets and liabilities and the determination of the resultThe principles adopted for the valuation of assets and

liabilities and determination of the result are based on

historical costs unless otherwise explained.

Unless stated otherwise, assets and liabilities are stated at face

value. Income and expenses are allocated to the period to

which they apply.

The figures of 2009 are re-classified for comparison (with the

figures of 2010).

Accounting principles for the translation of foreign currencyTransactions denominated in foreign currency are translated to

euros at the applicable exchange rate on the transaction date.

Monetary assets and liabilities denominated in foreign

currency are translated to euros at the exchange rate applicable

on balance sheet date. Exchange rate differences are taken to

the profit and loss account. Non-monetary assets and liabilities

denominated in foreign currency that are valued on the basis

of historical costs are translated at the applicable exchange

rate on the transaction date.

Principles of consolidationIn view of their transparent structure, Stichting Buma/Stemra

Obligatiefonds and Stichting Buma/Stemra Aandelenfonds

are included in the Stemra financial statements by means of

proportional consolidation. Assets and liabilities, as well as

income and expenses, are included in proportion to the

participating interest. On the basis of the information provided

in the notes, no separate financial statements for Stemra

are included.

Tangible fixed assetsThe valuation of tangible fixed assets takes place on the basis of

historical cost less cumulative depreciation.

The depreciation is calculated as a percentage of the purchase

price according to the straight-line method on the basis of the

expected useful life.

The following expected useful life terms are applied:

• Computer equipment 3 years

Accounts receivableAccounts receivable are stated at nominal value less a

provision for bad debts.

Financial fixed assets The securities included under financial fixed assets are listed

shares, bond funds, and (convertible) bonds. Securities are

stated at market value as at balance sheet date.

Revaluation reserve for financial fixed assets Price gains/losses arising from the valuation of securities at

market value are not directly taken to the trading account, but

are first included in the revaluation reserve for financial fixed

assets (hereinafter: ‘revaluation reserve’). To the extent that the

revaluation reserve is insufficient, the deficit is charged to the

result.

Each year, the size of the revaluation reserve needed to absorb

price fluctuations is determined by the management board in

consultation with its asset managers. If the revaluation reserve

is larger than deemed necessary, this surplus is eligible for

addition to the royalties to be distributed.

Financial result and standard returnDividends are accounted for in the period in which they are

made payable; interest income is accounted for in the period

to which it relates.

Insofar as the balance of the revaluation reserve, less a possible

appropriate reserve for (un)realised gains or losses arising from

changes in market prices, leaves room for this, a ‘standard

return’ is included in the financial result, in addition to any

receivable share dividend and interest on bond funds. In the

calculation of the standard return, the dividend and interest

already paid out are taken into account, and only the difference

between the dividend/interest received and the standard

return is settled with the revaluation reserve.

The standard return is calculated as a percentage of the average

value of the shares and bond funds over the financial year, and

comprises the effective return on 5-year euro government

bonds at the end of the financial year plus a risk mark-up for

shares. The difference between the standard return and the

dividend received on shares or interest received on bond funds

is withdrawn from the revaluation reserve, if possible.

noTes To The sTemra Balance sheeT and profiT and loss accounT


Due to progressive changes in legislation and regulations, the

system of applying a standard return is no longer regarded as a

generally acceptable principle.

However the system of standard return fits in with the

requirement that the recorded investment results on shares

and fixed-income securities show the most even development

possible in the profit and loss account over the years. For this

reason the management board and directors have decided to

continue the system of standard return.

Continuity reserve The continuity reserve’s aims include guaranteeing the

continuity of the work. It also serves to fulfil obligations in

respect of third parties, in particular with regard to distribution

of the royalties yet to be distributed in accordance with the

financial statements. This reserve furthermore serves to level

out unwanted fluctuations in the amounts available for

distribution, resulting, among other things, from domestic and

international pressure on turnover, as well as continuing

changes in the distribution of rights.

Appropriated reserveAppropriated reserves are the parts of reserves that

management has set aside for a special purpose. In this case, it

concerns the appropriated reserve for (un)realised gains/losses

arising from changes in market prices. For more detailed

information on this appropriated reserve, please refer to the

notes to the balance sheet.

ProvisionsProvisions are measured at either the nominal value of the

estimated expenditure required to settle liabilities and losses,

or the present value of that expenditure.

A provision is mentioned in the balance sheet when there is:

• a legal or constructive obligation as a result of a past

event, and

• of which a reliable estimate can be made, and

• it is probable a cash outflow is necessary to settle

the obligation.

The provision for reorganization costs is related to the

estimated costs of redundancy.

The long-service awards provision is a provision for future

long-service awards. The provision is the present value of

future benefits to be paid for long-service awards.

Determination of the resultIncome and expenses are accounted for in the year to which

they apply. The result is determined by calculating the

difference between the balance of realised income and

expenditure and the financial result for the year. The balance

of the profit and loss account is allocated/deducted from the

royalties to be distributed and/or the reserves by means of

profit appropriation.

Financial expenses The operating costs of the system for the collection of

programme data, Fingerprinting, are no longer classified as

financial expenses, but from 2010 directly charged to the

operating result.

Pension plans Obligations for contributions to defined contribution pension

plans are recognised as an expense in the profit and loss account

when the contributions are due.

Turnover In the financial statements, the turnover in royalties is added

to the royalties distributed. Stemra includes the exploitation of

mechanical rights in the turnover, insofar as these relate to the

financial year, can be determined in a reliable manner, and

there is reasonable certainty that the revenue is collectible.

TaxWith regard to Stemra, the Dutch tax authorities stipulated in an

agreement dated November 6, 2001, determining the legal

relationship between the parties, that Stichting Stemra is liable to

pay corporation tax. This agreement was extended at the end of

2008 for a period of three years, and is valid until 31 December

2011. Foreign withholding tax available for set-off and Dutch

dividend tax may be deducted from the tax due by virtue of this

agreement determining the legal relationship between parties.

A tax item is only included in the financial statements if

corporation tax is still owed after deduction of the foreign

withholding tax available for set-off.

Accounting principles for cash flow statementThe cash flow statement is drawn up using the indirect method.

noTes To The sTemra Balance sheeT and profiT and loss accounT


Use of estimatesDrawing up the financial statements requires management to

form opinions and make estimates and assumptions that

influence the application of principles and the reported value

of assets and liabilities, and of income and expenses. The

estimates and the associated assumptions are based on past

experience and various other factors that are considered

reasonable in view of the circumstances.

The outcome forms the basis for the opinion on the carrying

value of assets and liabilities that does not emerge clearly from

other sources.

The actual results may differ from these estimates.


noTes To The sTemra Balance sheeT as per 31 decemBer 2010

Computer equipment

Actual cost as per 1 January 2010 1,354

Cumulative depreciation -1,130

Balance sheet value as per 1 January 2010 224

Changes during the financial year:

Investments 157

Depreciation -171

-14

Actual cost as per 31 December 2010 1,511

Cumulative depreciation -1,301

Balance sheet value as per 31 December 2010 210

Depreciation in number of years on average 3

In the profit and loss account, the depreciation expense is stated,

including depreciation charged on by Buma of € 0.1 million as a

result of Stemra’s use of Buma’s assets.

(1) Tangible fixed assetsThe changes in the tangible fixed assets can be specified

as follows:

(x € 1,000)


2010 2009

Balance sheet value as per 1 January 91,915 90,687


Acquisitions 10,790 17,842

repayments / sales -53,793 -23,820

price movements 2,247 7,206

-40,756 1,228

Balance sheet value as per 31 December 51,159 91,915

Securities and bonds of Stichting Stemra are carried at market value.

Valuation differences on bonds and shares are charged or credited to

the revaluation reserve for financial fixed assets.

the total face value of the bonds amounted to € 12.0 million (2009:

€ 24.1 million) compared to a market value of € 12.4 million (2009:

€ 24.4 million). the reduction in the face value of € 24.1 million to

€ 12.0 million is on the one hand the effect of the conversion of part

of the fixed-income securities to bond funds and on the other hand

a decline in interest in the Stichting Buma/Stemra obligatiefonds

of 16.4%. this decline of 16.4% is the result of the sale of partici-

pations by Stemra worth € 69.5 million (repayment of loan in

current account to Buma € 55.7 million, repayment of loan in current

account to BSo and BSA € 13.3 million, increase cash Stemra € 0.5

million).

Stemra’s securities have been placed in Stichting Buma/Stemra

obligatiefonds and Stichting Buma/Stemra Aandelenfonds. the

foundations are proportionally consolidated in Stemra’s financial

statements at an average percentage of 20.1% (2009: 36.5%). At

the end of 2010 the interest is changed from 36.5% to 20.1%.

For the result implies that the percentages are used as applied for

2010 (36.5%). the participations give Stichting Stemra a 20.1%

(2009: 36.5%) interest in Stichting Buma/Stemra Aandelenfonds

and a 20.1% (2009: 36.5%) interest in Stichting Buma/Stemra

obligatiefonds at year end 2010.

(2) Financial fixed assetsThe changes in the financial fixed assets can be specified as follows:

(x € 1,000)

Securities

31 December 2010 31 December 2009asseTs

Fixed assets

Financial fixed assets 254,006 251,695

Other assets 15,823 73,440

269,829 325,135

liaBiliTies

Participants’ account 269,395 324,752

Current liabilities

Creditors 434 383

269,829 325,135

the fully-combined Financial statements of Stichting Buma/Stemra obligatiefonds (BSo) [Buma/Stemra bond Fund Foundations] and

Stichting Buma/Stemra Aandelenfonds (BSA) )[Buma/Stemra equity Fund] can be represented in condensed form as follows:

(x € 1,000)


(4) Other accruals and deferred income

(x € 1,000) 31 December 2010 31 December 2009

Interest to be received 228 426

(3) Current account balancesthese consist mainly of current account balances with Stemra

associations and participants. Further notes about the settlement

of this current account balance is mentioned at the financial

fixed assets.

During the year a withdrawal is made that refers to the completion

of the streamlining of the organization which started in the previous

years. the withdrawal of € 0.2 million was recognized through the

profit and loss account (exceptional income and expenses). In 2009 a

withdrawal of € 0.7 million was made by way of profit appropriation.

the withdrawal levels out unwanted fluctuations in the amounts

available for distribution partly as a result of the negative financial

result.

(5) Cash at bank and in handAll the cash at bank and in hand is freely available

(6) Continuity reserveThe changes can be specified as follows

(x € 1,000)

2010 2009

Balance as per 1 January 5,929 6,650

Allocations - -

Withdrawals -169 -721

Balance as per 31 December 5,760 5,929

(7) Appropriated reserveThe changes can be specified as follows

(x € 1,000)

2010 2009

Balance as per 1 January -1,300 -2,600


Withdrawals - -

Balance as per 31 December - -1,300


€ 2.6 million of the negative result in 2008 is set aside by means

of result appropriation by the management board and the board

of directors in the appropriated reserve, in order to not fully settle

the effects of the stock exchange decline in 2008 with the 2008

collection year. In accordance with the intention of 2008, 50% of the

appropriate reserve of 2008 was balanced with the distributions of

the 2009 collection year and the remaining 50% is settled with the

distributions of the 2010 collection year.


2010 2009

Balance as per 1 January 5,683 -

(un)realised gains/losses arising from price changes 2,247 7,206

Withdrawal to the credit of the financial result to

standard return -1,719 -1,523

Withdrawal allocated to financial result -650 -

Balance as per 31 December 5,561 5,683

the (un)realized gain in securities amount to € 2.2 million (2009:

7.2 million) and are taken directly to the revaluation reserve for

financial fixed assets. the results on shares, (convertible) bonds and

bond funds are stated at a standard return. the percentage for 2010

was 6.2% (2009: 6.6%) for shares and for fixed-income securities

3.7% (2009: 4.1%). the withdrawal for the benefit of the financial

result at a standard return was € 1.7 million (2009: € 1.5 million).

the withdrawal allocated to the financial result was € 0.7 million.

(8) Revaluation reserve for financial fixed assets

The changes in the revaluation reserve for financial fixed assets can

be specified as follows: (x € 1,000)

Balance as per Additions Withdrawals Balance as per

1 January 2010 2010 2010 31 December 2010

optimisation of operations 148 - -148 -

long-service awards 74 12 -12 74

reorganization costs 157 - -18 139

397 12 -178 213

(9) Provisions

The changes in the provisions can be specified as follows:

(x € 1,000)

Provision for optimisation of operationsthe international changes with regard to music use and as a result of

this the allocated funds require an adjustment of the organization to

optimise the services provided in accordance with domestically and

internationally accepted standards and competitive conditions.

Provision for long-service awardsthe provision for long-service awards is a provision for future long-

service awards, calculated on the basis of actuarial assumptions with

regard to indexation and life expectancy.

Provision for reorganization coststhe expectation is that the provision for estimated severance pay-

ments will generally be settled in 2011.


2010 2009

royalties to be distributed at the beginning of the year 40,863 45,438



Available for distribution 75,505 85,128

Distributed in the reporting year:

Associations and participants 28,493 34,128

Foreign organizations 4,964 5,638

Central licensing 195 671

Administrative costs withheld in the netherlands 2,920 3,604

Administrative costs withheld abroad 178 224

Distribution incl. administrative costs charged 36,750 44,265


of the available amount to be processed for distribution in 2011,

€ 2.3 million will be added to the indivisible rights (2009: € 2.3

million, distributed in the 2010 payment).

the positive result for 2010 amounts to € 0.3 million (2009: € 0.4

million negative). € 1.0 million (2009: € 1,0 million) of this amount is

deducted from the royalties to be distributed and in accordance with

the decision of 2008, € 1.3 million (2009: € 1.3 million) was allocated

to the appropriated reserve.

(10) Royalties to be distributed (x € 1,000)

2010 2009


Indivisible rights 2,348 2,285


Became available for distribution during the year 36,990 41,975

to be distributed at the beginning of the year 40,863 45,438

Available* 34,642 39,690

Distributed -36,750 -44,265


* Excluding indivisible rights which have already been

accounted for in the opening balance sheet

Available for distribution for Stemra(x € 1,000)



2010 2009

Biem phonomechanical rights/Central licensing 16,684 18,229

Special licensing/private labels 6,306 5,656

radio & tV Mechanical rights 5,138 7,266

Mechanical rights online licensing 515 1,314

Home Copy/lending rights 3,223 3,533

Mechanical rights Abroad 3,796 4,682

35,662 40,680

Break-down of Stemra turnover(x € 1,000)


Sister organizations abroad 3,063 3,475

Stemra associations and participants 1,555 1,522

Buma current account - 44,646

4,618 49,643

(11) Current account balances (x € 1,000)

the amounts owed to sister organizations abroad were largely

settled at the beginning of 2011. In the current account balance with

Buma a loan was included of € 55.7 million (2009: € 43.8 million)

from Buma to Stemra.

this loan is completely redeemed in 2010 by Stemra, so the Buma

current account was nil at the end of 2010. the loan is subject to

the euribor three-month-rate.

Advances to Dutch industrythis includes the invoiced advances on reproduction rights to

be settled by the Dutch industry for periods up to the end of 2010.

When the settlements are received from these producers, the

advances are deducted from the royalties to be received.


Advances to Dutch industry 11,355 11,209

to be offset with industry and private labels 263 196

Holiday allowance/annual leave 102 142

other liabilities and accruals 335 547

12,055 12,094

* adjusted for comparison

(12) Other liabilities and accruals (x € 1,000)


off-Balance sheeT commiTmenTs

Partially pledged bond portfolioIn accordance with the decision of the management board, at the

end of 2002, part of the bond portfolio of Stichting Buma/Stemra

obligatiefonds amounting to € 27.5 million was pledged as security

to InG Bank n.V. in connection with a cash facility needed for

normal operations.

Longterm financial liabilitythe financial liability with regard to the business accommodation in

Hoofddorp was entered until April 30, 2012.

the annual rent for Buma/Stemra together amounts to € 1.9 million

of which approximately 40% will be charged to third parties.

In the current composition, the annual amount for the leasing of cars

by Buma/Stemra is € 0.3 million.

the liability for terms longer than one year is € 0.4 million.

the financial liability for the rent of the printers was entered until

May 1, 2013. the annual rent amounts to € 0.1 million.

Buma/Stemra entered into a contract allowing Accenture to perform

a large portion of Buma/Stemra’s back office activities from 2007

until March 31, 2017. the resulting financial obligation amounts to

€ 18.2 million for the remaining duration of the contract, assuming

consistent volumes.

the off-balance sheet commitments of € 21.5 million can be

summarised as follows:

• less than 1 year: € 5.1 million

• between 1 and 5 years: € 15.7 million

• longer than 5 years: € 0.7 million



2010 2009

Salaries 826 884

Social security contributions 119 121

pension contributions 78 86

other personnel expenses 72 41

1,095 1,132

Charged/compensated to third parties 3,923 3,819

5,018 4,951

expenses

(13) Personnel expenses (x € 1,000)

noTes To The sTemra profiT and loss accounT for 2010

the average number of employees during the reporting

year was 22 employees (2009: 23 employees) which corresponds

to an average of 20 Fte (2009: 20 Fte).

this amount does not include employees charged on via Buma.

Salary management board Stemra and registered Directors Buma/Stemra for the year 2010(x € 1,000)

Management StemraFee for 12 members of the management board Stemra

(incl. expense allowance) € 74.2

Registered Directors Buma/Stemra

H.G. van der ree salary € 200.0

(from May 1, 2010) pension charges € 40.4

C. van rij salary (incl. variable reward) € 233.9

pension charges and car € 55.2

C.p. Vervoord, former

chairman salary (incl. variable rewards) € 379.2

(till August 1, 2010) pension charges € 56.1

of the amounts mentioned above 30% is recognized in the financial statements of Stichting Stemra and 70% in the financial statements of

Vereniging Buma.

In preparing the financial statement until 2009 we used the exemption under Article 383 paragraph 1, title 9 BW2.


2010 2009

Interest income and other incomeFixed income securities

Interest received on bonds 923 1,126

Shares

Share dividend received 2,019 2,160

2,942 3,286

Mutations revaluation reserve

Withdrawals from revaluation reserve for the benefit

of the financial result at standard return 1,719 1,523

Withdrawal from revaluation reserve allocated to financial result 650

other interest income and similar income 219 214

total income from investments 5,530 5,023


Interest expenses and other costs -709 -704

4,821 4,187

(14) Financial result (x € 1,000)

Financial expenses the operating costs of the system for the collection of programme

data, Fingerprinting, are no longer classified as financial expenses,

but from 2010 directly charged to the operating result.


oTher informaTion

To: The Board of Directors and the general meeting of affiliates to Stichting Stemra

independenT audiTor’s reporT

We have audited the accompanying financial statements 2010

of Stichting Stemra, Hoofddorp, which comprise the balance

sheet as at December 31, 2010, the profit and loss account for

the year then ended and the notes, comprising a summary of

the accounting policies and other explanatory information.

Management’s responsibility Management is responsible for the preparation of the financial

statements in accordance with the accounting policies selected

and disclosed by the entity, as set out in the notes to the

financial statements. Furthermore, management is responsible

for such internal control as it determines is necessary to enable

the preparation of financial statements that are free from

material misstatement, whether due to fraud or error.

Auditor’s responsibilityOur responsibility is to express an opinion on these financial

statements based on our audit. We conducted our audit in

accordance with Dutch law, including the Dutch Standards on

Auditing. This requires that we comply with ethical require-

ments and plan and perform the audit to obtain reasonable

assurance about whether the financial statements are free

from material misstatement.

An audit involves performing procedures to obtain audit

evidence about the amounts and disclosures in the financial

statements. The procedures selected depend on the auditor’s

judgment, including the assessment of the risks of material

misstatement of the financial statements, whether due to

fraud or error. In making those risk assessments, the auditor

considers internal control relevant to the entity’s preparation

of the financial statements in order to design audit procedures

that are appropriate in the circumstances, but not for the

purpose of expressing an opinion on the effectiveness of

the entity’s internal control. An audit also includes evaluating

the appropriateness of accounting policies used and the

reasonableness of accounting estimates made by manage -

ment, as well as evaluating the overall presentation of the


We believe that the audit evidence we have obtained

is sufficient and appropriate to provide a basis for our

audit opinion.

OpinionIn our opinion, the financial statements are prepared, in all

material respects, in accordance with the accounting policies

selected and disclosed by the entity, as set out in notes to the


Basis of accounting and restriction on distribution and useWe draw attention to notes to the financial statements, which

describes the basis of accounting. The accounting policies

used are selected and disclosed by the entity. Our opinion is

not qualified in this respect.

Amstelveen, April 6, 2011

KPMG ACCOUNTANTS N.V.

R.J. Groot RA


suBsequenT evenTs

Profit appropriationFor Stemra, the result for 2010 will be deducted from the

royalties still to be distributed.

Then, according to the assessment of the reserve, it will be

determined to what extent funds will have to be added to

or deducted from this. This movement will also be credited

or charged to the royalties to be distributed.

Proposal of the board of directorsAs shown in the financial statements, which we prepared in

accordance with Article 26(2) of the Articles of Association,

the board of directors proposes deducting c 1.0 million of the

positive result of c 0.3 million, from the royalties to be

distributed and allocating c 1.3 million to the appropriated

reserve (in accordance with the decision made in 2008).

The proposal has already been incorporated in the 2010





managemenT Boards and direcTors

De Jeugd van tegenwoordig

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composiTion of managemenT Boards and direcTors

As per April 1, 2011

Management board of Vereniging Buma

dr. K.P. Boehmer

Chairman – composer

serious music

mr. H. Kosterman

Vice-chairman - composer/

lyricist light music

T. Berk

Secretary – publisher

drs. S.A.A. Abdoelbasier

composer / lyricist light

music

J.A. van Bergen

lyricist

A.J.H. van Berkel

publisher

P.M. van Brugge

composer media music

H.C.M. de Clercq

composer serious music

M.W. Mensink

publisher

T.J.M. Peters

composer/lyricist

light music

A.L.L. de Raaff

publisher

drs. H.O. Westbroek

composer/lyricist

light music

R.D. van Vliet

vice chairman - publisher

mr. E. Boom

secretary – author

mr. drs. L.J. Deuss

publisher

J.C.R. Gerrits

publisher

J.H. Grevelt

author

J.N. Hamburg

author

mr. H. Kosterman

author

A.J. Kraamer

author

A.C.M. Ruiter

author

drs. H.O. Westbroek

author

dr. K.P. Boehmer,

chairman – author,

appointed by Buma

Management board of Stichting Stemra Vacancy per 1-1-2011

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Directors of Buma/Stemra

H.G. van der Ree

Chairman of the Board

of Directors

mr. C. van Rij

Director Legal Affairs

drs. W.J. Ketellapper

Director General Affairs

mr. H. Eijkelenboom

Secretary of the Board of

Directors


addiTional joBs sTaTuTory direcTors

lisT of addiTional posiTions of memBers of The Board of Buma as per april 1, 2011

Drs. S.A.A. Abdoelbasier, Composer/lyricist light music- employed at royal Bank of Scotland- Chairman Stichting Consent- Commissioner and shareholder of Financial

Street VoF- Commissioner and shareholder of Beaubury

trading Street VoF- Member of the board palm- Member of the board BSA (Stichting Buma/

Stemra Aandelenfonds)- Member of the board BSo (Stichting Buma/

Stemra obligatiefonds)

J.A. van Bergen, Lyricist- Freelance Author for theatre, tv, movie, radio,

song, print and advertising - In partnership Van Bergen and Storimans/

Authors, Hoorn- Advisor Music theatre Fonds podium Kunsten- Intended secretary and joint managing

Director of Stichting paul van Vliet Academie i.o.

- Member of the board BSA (Stichting Buma/Stemra Aandelenfonds)

- Member of the board BSo (Stichting Buma/Stemra obligatiefonds)

T. Berk, Publisher- Managing Director ( president) of talpa Music

B.V., AMV/talpa Music GMBH, 8ball Musisic and “the Voice talent Agency BV.” Also of his private holding “Son Vida Holdings BV”



A.J.H. van Berkel, Publisher- Managing Director Warner/ Chappell Music

Holland BV.- Member of the board BSA (Stichting Buma/



Dr. K.P. Boehmer, Composer serious music- Freelance composer- Member of the board GeneCo

- Member of the board unie van Composeren in the netherlands

- Vice-Chairman european Composers Forum (eCF)

- Vice-Chairman BIeM- Chairman Stemra- Member of the board BSA (Stichting Buma/



P.M. van Brugge, Composer media music- Freelance composer- Senior lecturer composition bij Codarts

Hogeschool voor de Kunsten rotterdam- Freelance executive musician and conductor

(ZZp)- Member of the board of the association

Dutchfilmcomposers.nl - Member of the board BSA (Stichting Buma/



H.C.M. de Clercq, Composer serious music - Freelance composer- Freelance filmmaker(directing, camera,

editing)- Member of the board BSA (Stichting Buma/



Mr. H. Kosterman, Composer/lyricist light music- Chairman of palm- Secretary of Sena- Member of the board Stemra- Member of the board BSA (Stichting Buma/



M.W. Mensink, Publisher- Director Strengholt BV- Managing Director and majority shareholder

VoC BV- treasurer Vereniging Muziekhandelaren and –

uitgeverijen van nederland- Member of the board BSA (Stichting Buma/



T.J.M. Peters, Composer/lyricist light music- Freelance composer / lyricist- Freelance Music producer- Music publisher- owner/partner nrGY Music BV - partner BoepBV (digital music distributor)- Member of the board Sena (sector performers)- Member of the board Vereniging palm - treasurer GonG- treasurer StoMp (independent record label

nVpI)- Member of the board BSA (Stichting Buma/



A.L.L. de Raaff, Publisher- Managing Director and majority shareholder

of entertainment company CtM BV, including the Music publisher Cp Masters BV and Imagem CV

- Chairman nederlandse Muziek uitgevers Vereniging

- production Harpengala- Member of the board BSA (Stichting Buma/



Drs. H.O. WestbroekComposer/lyricist light music- Copywriter- performing artist- Columnist- radio and tV presenter at radio Veronica,

respectively rtV utrecht- Joint manager Café-restaurant ‘Stairway to

Heaven’- Member of the board Stemra- Member of the board BSA (Stichting Buma/



H.G. van der Ree, Chairman of the Board of Directors Buma/Stemra as per May 1, 2010- Statutory chairman of the Board of Directors

Stichting Buma/Stemra Aandelenfonds- Statutory chairman of the Board of Directors

Stichting Buma/Stemra obligatiefonds- Member of the board Stichting Buma/Stemra

Deelneming- Secretary/treasurer Stichting SCAn- Member of the board Stichting Brein- Secretary Stichting Buma Cultuur- Vice chairman Vereniging VoICe

mr. C. van Rij, Vice Chairman of the Board of Directors Buma/Stemra, Director Legal Affairs Buma/Stemra- Member of the board Stichting Buma/Stemra

Deelneming- Secretary Stichting Brein- treasurer Stichting de thuiskopie- Member of the board Stichting leenrecht- Member of the board Stichting onderhandelin-

gen thuiskopievergoeding- Member of the board Stichting

onderhandelingen leenrechtvergoeding

- Member of the board Stichting Beheer rechten Fingerprinting Database

- Member of the board vereniging VoICe

C. Vervoord, 1 May resigned as Chairman of the Board of Directors and in August 2010 resigned from Buma/Stemra


Dr. K.P. Boehmer, Author, appointed by Buma- Freelance composer- Member of the board GeneCo - Member of the board unie van Composeren in

nederland, - Vice-chairman european Composers Forum (eCF)- Vice-chairman BIeM- Chairman Buma- Member of the board BSA (Stichting Buma/



R.D. van Vliet, Publisher- owner of Cloud 9 Music bv- Member of the board Buma Cultuur- Member of the board BSA (Stichting Buma/


Stemra obligatiefonds)- Managing Director and majority shareholder

Cloud 9 Music bv- Managing Director and majority shareholder

Cloud 9 Dance nv- Managing Director and majority shareholder

Chrysalis Songs Benelux- Managing Director and majority shareholder

Dance Foundation bv- Managing Director and majority shareholder

napith ltD- Managing Director and majority shareholder

the right track Music- owner rVV Music bv

Mr E. Boom, Author- Composer/Copywriter- Musician- Managing Director and majority shareholder

number one Music Holland BV, music publisher- Managing Director and majority shareholder

Gentle Consultancy BV, legal consultancy entertainment-line of business

- Member of the board; secretary Stichting Sociaal Fonds Buma

- Member of the board; secretary Vereniging pAlM

- Member of the board occupational pension fund Stichting AenA

- teacher Johan Alsbach Stichting, College for Music publishers



Mr. drs. L.J. Deuss, Publisher- Director Albersen Verhuur bv and Deuss

Holding bv- Chairman of the board leo Smit Stichting- Chairman Stichting output/Amsterdam

electric- Vice-chairman board VMn (Vereniging

of Music sellers and Music publishers in nederland)

- Member of the board/treasurer Stichting nederlands Music Instituut

- Member of the board Stichting Sociaal Fonds Buma

- Advisor Cultural projects of the city the Hague- Freelance teacher Artez Conservatorium Arnhem- Member of the board BSA (Stichting Buma/



J.C.R. Gerrits, Publisher- Managing Director and majority shareholder

High Fashion Music BV- Member of the board nederlandse Muziek

uitgevers Vereniging- Member of the board BSA (Stichting Buma/



J.H. Grevelt, Author- Member of the board BSA (Stichting Buma/


Stemra obligatiefonds)- treasurer Vereniging pAlM- owner HSG Music

J.N. Hamburg, Author- Composer- Director and joint owner of rapenburg

produkties V.o.F. including FutureClassics (CD’s) and FutureClassicsMusic (publisher)

- Chairman of Genootschap nederlandse Componisten

- Chairman of Stichting GeneCo- Member of the board BSA (Stichting Buma/



Mr. H. Kosterman, Author - Chairman of pAlM - Secretary van Sena- Vice-chairman Buma



A.J. Kraamer, Author- Musician, composer, lyricist, performing artist,

producer, publisher, conductor, arranger, technician

- owner/Director neW B.V. (new efficient Wholesale B.V.), teD B.V. (the electronic Designers), AKM B.V. (Ad Kraamer Music B.V.)

- Member of the board (Chairman) Htr (Stichting Heusdense tV& radio station)

- Member of the board pAlM (professional association, professional Authors light Music)

- Member of the board GonG (Genootschap onafhankelijke nederlandse Geluidsproducers)



A.C.M. Ruiter, Author- Freelance composer- Freelance performing musician- Member of the board BVpop, department of

FnV KIeM - Member of the board pAlM, professional

association of professional authors of light Music

- Member of the board General Management of Sena and Member of the board of department executives of Sena



Drs. H.O. Westbroek, Author - Copywriter- performing artist- Columnist- radio and tV presenter at radio Veronica

(respectively rtV utrecht)- Joint manager Café-restaurant ‘Stairway to

Heaven’- Member of the board Buma- Member of the board BSA (Stichting Buma/



lisT of addiTional posiTions of memBers of The Board of sTemra as per april 1, 2011


colophon

Fran

s D

uijt

s /

phot

o: A

ll A

cces

s en

tert

ain

men

t

phoTo cover:

Caro emeraldphoto: Adrie Mouthaan

Kytemanphoto: Mike Breeuwer

Michel van der Aaphoto: Marco Borggreve

Seung-Ah ohphoto: Co Broerse

renske taminiauphoto: Hans Speekenbrink

Sara Kroos(Annie M.G. Schmidtprijs)photo: Frans van Zijst

the ploctonesphoto: Jeroen Dietz

richard rijnvosphoto: Co Broerse

chief ediTors

Frank Helmink, Buma/Stemra

TexT

erik de Boer, Boardroom Financial pr

concepT & design

link Design, Amsterdam

prinTing W.C. Den ouden bv, Amsterdam

typographical and printing errors reserve. All amounts quoted in this annual report are in euros.Disclaimerthe original financial statements of Vereniging Buma and Stichting Stemra are prepared in the Dutch language. this document is an english translation of these financial statements. In case of differences between the english and Dutch text the latter will prevail.

phoTos BacK cover from Top To BoTTom:

ã ContentS

76 AnnuAl report 2010

Siriusdreef 22-282132 Wt Hoofddorpt 023 799 79 99F 023 799 77 77e [email protected]

the Hague officelange Voorhout 86-122514 eJ Den Haagt 070 310 91 09F 070 310 91 00e [email protected]

some of The mosT-TalKed

aBouT composers/lyricisTs in 2010

Buma association/stemra foundation

ã ContentS

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Annual Report 2010

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