Indies prepare their own Euro-showcase

Date: 04/07/02

By Peter Chapman

INDEPENDENT record labels plan to launch their own rival to the lavish Platinum Europe Awards which take place in Brussels next week.

Philippe Kern, secretary-general of the Independent Music Companies Association (IMPALA), said the 'indie' awards are likely to honour artists who have sold half a million records, rather than the million needed to 'go platinum'.

The 4th Platinum Awards, which takes place on Wednesday (10 July), is organised by the International Federation for the Phonographic Industry. Kern claims the IFPI is primarily a vehicle for the major labels to influence policymakers.

He says the awards - which will this year feature Luciano Pavarotti and Bob Geldof - are tailored mostly to acts backed with the majors' marketing muscle. 'The problem with the Platinum Awards is that out of the winning artists, very few are signed to independent labels,' adds Kern, himself a former IFPI and PolyGram executive.

Independent labels have, however, enjoyed some notable success stories in the past couple of years.

Britney Spears and the Backstreet Boys had huge record sales while signed to the independent Zomba label, which was bought last month by German giant BMG.

Despite the gulf in resources, the industry minnows are hoping to score lobbying hits in some - if not all - of the same areas as IFPI.

Kern said Impala, along with a coalition of record shops, is gearing-up to persuade the EU to allow lower rates of value added tax on CDs. It hopes the European Commission will support the idea when it releases a report on the so-called sixth VAT directive later this year.

The list of products for which member states can currently charge lower levels of VAT include food, water supplies, transport, medicines and books. Both IMPALA and the IFPI argue that CDs should be eligible for the same treatment as books. 'If you buy a book about Beethoven in France you may pay VAT of only 5.5. But if you buy a CD of his work it might be charged at 19.6. There is a distortion of competition,' says Kern.

Record companies face a tough task changing the regime. Under EU rules, any change to tax laws requires unanimous support from the 15 member states' finance ministers.

But with elections looming in Germany, Sweden and the Netherlands, Kern thinks there has never been a better chance. 'Promising to cut VAT would win votes - especially among the young,' he said.

The music industry has faced huge criticism for charging sky-high prices for CDs. But if taxes are cut, they say the savings will be passed on to the consumer.

Independent record labels plan to launch their own rival to the lavish Platinum Europe Awards which take place in Brussels on 10 July 2002.