A Canadian Music License Agreement is a legally binding contract between a copyright owner (the Licensor) and a party seeking to use musical compositions (the Licensee). This agreement grants the Licensee specific rights to use, reproduce, perform, or adapt one or more musical works under defined terms and conditions, while the Licensor retains copyright ownership. In Canada, music licensing is governed by the Copyright Act (R.S.C. 1985, c. C-42), which establishes the framework for intellectual property protection in creative works.

The Copyright Act grants copyright owners exclusive rights including the right to reproduce the work (s. 3(1)(a)), to perform the work in public (s. 3(1)(f)), and to communicate the work to the public by telecommunication (s. 3(1)(f)). A music license agreement allows the copyright owner to authorize one or more of these uses without transferring ownership of the copyright itself. Canada's copyright regime also protects the moral rights of authors under Section 14.1 of the Act, which include the right of integrity and the right of attribution. Unlike copyright, moral rights cannot be assigned, though they may be waived in writing.

Canada has several collective societies that administer music rights on behalf of creators. SOCAN (Society of Composers, Authors and Music Publishers of Canada) administers public performance and communication rights. Re:Sound collects neighbouring rights royalties on behalf of performers and record labels. The CMRRA (Canadian Musical Reproduction Rights Agency) handles mechanical reproduction licenses. A direct music license agreement between parties operates alongside these collective licensing frameworks and is essential when the intended use falls outside the scope of collective tariffs or when the parties wish to negotiate terms specific to their transaction.

A Canadian Music License Agreement is needed whenever one party wishes to use another party's musical composition for commercial or non-commercial purposes beyond what is permitted under the fair dealing provisions of the Copyright Act (ss. 29-29.2). Common scenarios include licensing music for use in film, television, and video productions; synchronization with audiovisual content; digital streaming and online distribution; live performances and event production; advertising campaigns and promotional materials; video games and interactive media; podcasts and audio programs; and theatrical productions.

This agreement is particularly important when the intended use does not fall within the scope of existing SOCAN or Re:Sound tariffs, or when the parties require specific terms regarding exclusivity, territory, duration, or compensation that differ from standard collective license terms. Under the Copyright Act, an exclusive license must be in writing and signed by the owner of the copyright or by the owner's duly authorized agent (s. 13(4)). Even non-exclusive licenses benefit from written documentation to clearly define the scope of authorized use and avoid disputes.

The agreement should be executed before any use of the musical work begins, as unauthorized use constitutes copyright infringement under Section 27 of the Act. Copyright infringement in Canada can result in statutory damages of between $500 and $20,000 per work infringed for commercial purposes (s. 38.1(1)(a)), or up to $5,000 total for non-commercial purposes (s. 38.1(1)(b)).

An effective Canadian Music License Agreement must clearly identify both parties and the specific musical work(s) being licensed, including title, composer, ISRC number or catalogue reference, and any associated sound recordings. The agreement must specify the type of license being granted (exclusive, non-exclusive, or sole) and define the precise scope of permitted uses, as any use beyond the granted license constitutes infringement under the Copyright Act.

The agreement should define the licensed territory, duration, and any renewal provisions. Compensation terms must be clearly stated in Canadian dollars (CAD), including any upfront license fees, ongoing royalties, and the method and timing of payments. The agreement should address the relationship between direct payments under the agreement and royalties collected through collective societies such as SOCAN, Re:Sound, and the CMRRA.

Key legal provisions include representations and warranties from the Licensor confirming copyright ownership and non-infringement of third-party rights; acknowledgment and protection of the Licensor's moral rights under Section 14.1 of the Copyright Act; credit and attribution requirements; provisions for termination and the Licensee's obligations upon termination; indemnification and limitation of liability clauses; and a governing law clause specifying the applicable Canadian province. The agreement should also address GST/HST obligations under the Excise Tax Act (R.S.C. 1985, c. E-15), as license fees may be subject to federal and provincial sales taxes depending on the nature of the transaction and the location of the parties.