Music royalty regulations for commercial use such as in cafes and restaurants have caused unrest among business players. Many café, restaurant and hotel owners feel that the royalty collection procedures are not transparent and too burdensome, especially in the midst of post-pandemic economic recovery.
This makes them have to rack their brains to make a profit in the midst of this polemic case, but also free from penalty fines due to negligence in terms of royalties.
For example, Japanese restaurant owners in the Pamulang and Cipete areas. They have decided to stop playing music in their restaurants since this issue surfaced in recent weeks.
He doesn't want to be subject to a royalty payment of Rp120,000 per seat per year for commercial music playback.
The cafe, which used to play contemporary music, was quiet. There were no hits from famous musicians in the country.
"As a restaurant owner, I object to royalty payments because there are already many other financial piles, such as restaurant tax payments to the government, distribution of employee salaries which are also taxed. Not to mention, the restaurant's income is uncertain so when it is pegged at Rp 120,000 per seat in a year it feels heavy," the cafe owner told SUAR (6/8/2025).
He chose to remain anonymous in order to save his business.
"As a restaurant owner, I object to royalty payments because there are already many other financial piles, such as restaurant tax payments to the government, distribution of employee salaries which are also taxed." said a cafe owner who did not want to be named.
As we know, the Government through Government Regulation (PP) Number 56 of 2021 regulates the management of song and/or music copyright royalties. This regulation requires commercial establishments, including cafes and restaurants, to pay royalties to songwriters and related rights holders if they play music. Royalties are collected by the National Collective Management Agency (LMKN).
Many business owners have objected to this regulation because it is considered an additional burden on operational costs, in addition to other obligations such as local taxes and employee salaries. The owner of a Japanese restaurant in Pamulang and Cipete revealed that this regulation feels burdensome, especially because the fees charged are quite large and the uncertainty of the restaurant's daily income.
"I also don't understand why royalty payments are only now starting to get busy. Previously there was a Spotify application that was also a subscription, so what is the mechanism, can you use spotify?" he asked.
He also highlighted the lack of socialization regarding this rule, especially regarding music playback from apps like Spotify.
He also highlighted the lack of socialization regarding this rule, especially regarding music playback from apps like Spotify.
Before the royalty rule came into effect, this restaurant owner played music for a variety of important reasons for the comfort of customers and the ambience of the restaurant. According to him, music makes customers feel comfortable while eating and not feel confused while waiting for their orders.
Looking for innovative music substitutes
Instead of continuing to play music with the potential royalty fees, the restaurant owner looked for other solutions to still create a cozy atmosphere for customers.
He adopted several innovations that attracted visitors. One of his solutions was to play radio and music arrangements instead of music, which he felt did not require royalty payments.
In addition, it also provides various games for customers to create interaction between customers.
"We also provide games such as card games, chess, and congklak because our customers and target market are students," he said.
Another innovation is to utilize the Japanese interior of the restaurant. This unique interior design is a special attraction for visitors, especially for those who like to create content on social media.
When asked about the effectiveness of these innovations, the restaurant owner replied, "Oh, it's very effective, it's different. I also believe that customers will keep coming back because of the quality of the food, but these innovations can enhance their experience at the restaurant," he said.
"I also believe that customers will keep coming back because of the quality of the food, but these innovations enhance their restaurant experience," he says.
This issue surfaced after the news of the Director of PT Mitra Bali Sukses (Mie Gacoan), I Gusti Ayu Sasih Ira, who was officially named as a suspect in a copyright infringement case on Thursday (7/24/2025).
Ira allegedly did not pay music royalties for the use of songs or music played at Mie Gacoan Bali outlets . The value of music royalty arrears that need to be paid by PT Mitra Bali Sukses as the holder of the Gacoan Noodle brand outside Java is estimated at Rp 7 billion. This calculation is done using a method based on regulations on royalties.
Responding to this polemic, the Indonesian Hotel and Restaurant Association (PHRI) of West Nusa Tenggara called on café and restaurant businesses not to play music if they do not want to be exposed to criminal cases over royalty rules.
"If it's really hard (to pay royalties), don't play the song so it won't be a problem," said PHRI NTB Chair Ni Ketut Wolini as quoted by Antara.
Won't bankrupt you
Chairman of the National Collective Management Institute (LMKN), Dharma Oratmangun, responded to the concerns of café and restaurant entrepreneurs regarding the obligation to pay music royalties. He emphasized that paying royalties is a tribute to creative industry players and will not make businesses go bankrupt.
"As if paying royalties is bankrupt. In fact, royalty payments protect creative industry players. This tariff is the lowest adjusted to the state of the national economy," he said as quoted from Kompas TV (5/8/2025).
According to him, LMKN has also considered various things. For example, micro, small and medium enterprisesUMKM) will be given different calculations and of course cheaper than restaurants. He added that LMKN does not calculate tariffs based on 365 full days because of certain months such as the fasting month.
Anang Hermansyah, an Indonesian singer, musician, songwriter, music producer, explained that royalty payments from music playback in cafes and restaurants are rights that have been regulated and protected in Law No. 28/2014 on Copyright.
"Artists today are only asking for their rights. The law has explained about copyright, performing rights, there are mechanical rights, fixation rights, and there are other rights that are protected by law. We agree with the law," he told SUAR (7/8/2025).
He added that songwriters do not simply ask for their rights, but the rights are born from the work and creative work of artists. according to him, songs used by others for commercial purposes contribute to cafe and restaurant owners so artists also need to benefit from the effort of creating the song.
According to D'Masiv Band Vocalist, Rian Ekky Pradipta, royalty payments are not a burden for entrepreneurs, but an appreciation for songwriters.
"The regulation has been clear for a long time. Since 11 years ago, many restaurants, cafes, malls, and stations have also paid royalties to LMKN," said Rian D'Masiv as quoted on Kompas TV (6/8/2025).
Find a way out that is not burdensome
According to Minister of State Secretary Prasetyo Hadi, the government is aware of the polemic surrounding the payment of music royalties in cafes and restaurants. The government is currently trying to find the best way to resolve this issue.
"We are looking for the best way out," he said in a release from the Presidential Secretariat.
Prasetyo emphasized that the purpose of this regulation is basically to protect songwriters. He also mentioned that the government will continue to conduct socialization and dialogue with all relevant parties, including the Café and Restaurant Association, as well as the National Collective Management Agency (LMKN). It is hoped that through this approach, a fair and balanced solution will be reached for all parties.
Responding to this, Deputy Speaker of the House of Representatives Sufmi Dasco Ahmad asked the Ministry of Law (Kemenkum) to immediately formulate technical regulations that do not burden business actors, but still protect the economic rights of songwriters.
"The House of Representatives is also paying close attention to the world of music which has had dynamics for some time, and we have asked the Ministry of Law which then also oversees LMK-LMK (Collective Management Institution) to also make rules that do not complicate things," Dasco said in a press statement received by the SUAR team.
According to Dasco, Commission X of the House of Representatives is currently discussing the revision of Law No. 28/2014 on Copyright. This revision is expected to provide legal clarity and a more transparent and accountable royalty management system.
"While waiting for the revision of the Copyright Law that is being revised by the DPR, the government needs to create fair regulations," he said.
Data from the National Collective Management Institute (LMKN) notes that by 2023 the total royalty income will reach more than IDR 150 billion, but its distribution to songwriters is still in the spotlight. Currently, there are around 10 Collective Management Institutions (LMK) operating in Indonesia with the task of collecting and distributing royalties from various types of song usage.
Data from the National Collective Management Institute (LMKN) noted that in 2023 the total royalty income reached more than IDR 150 billion, but its distribution to songwriters is still in the spotlight.
On the other hand, musicians and songwriters demand that their economic rights be fulfilled as stipulated in the law. They call the playing of works without compensation a form of legalized piracy.
Dasco emphasized that the technical rules to be drafted by the government and LMK must be fair and not cause new conflicts between business actors and songwriters. "There must be clarity of mechanism, transparency of tariffs, and complaint channels if there are violations from both parties," he said.
The House, Dasco continued, also hopes that the revision of the Copyright Law will be able to regulate in more detail the classification of business premises based on business scale, so that the application of royalties can be more proportional.