How to Create Contracts
Contracts are the hub of all royalty processes - they are used to store down contract terms, match the catalogue to, & track your artist's balance. Please watch our introduction to Contracts in the video below. We provide notes and further reading further down this page.
How to Create Contracts
In the Contract you will specify which rate you will pay as a royalty to your artists. You will also specify how often you want to create a statement for this Contract, if there currently is an outstanding balance for the Contract, which Payee you want to account the royalties to, & if you want to create self-invoices on behalf of the artist. You can create Contracts either via the interface on Curve, or in bulk via the Contract template.
Add Contracts via the Interface
To get started, go to the Contracts directory and select the Contracts page. You can create a new Contract by selecting the +Create button on the top right of your screen. A Contract has many features to cover all possible contract scenarios, many of which are optional to use. First, we will go through all the steps one generally would go through when creating a Contract. Further down we’ll briefly discuss the available options you may wish to use.
Overview Tab
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- Select the Payee – Specify in which portal you would like the statements of this Contract to be published.
- 2
- Name your Contract – For your and your artist’s reference, pick a name that is clear and consistent.
- 3
- Select the Accounting Period – How often do you wish to account to this artist? More info
- 4
- Select the Contract type – Is this a Royalty or Flexible Profit Share deal? In a Royalty deal, a royalty percentage will be applied to each sale & cost on a line by line basis. In a Flexible Profit Share deal, Curve will take the sum of all sales & all costs, & apply a set percentage to your artist’s balance. When selecting a Flexible Profit Share deal, an additional Profit Share % field will appear where you can specify the share of the profit you wish to share with your artist. More info
- 5
- Set the Opening Balance – Is there any ongoing business going on with this artist? Perhaps your artist is due an unpaid royalty, or there is a loss or advance still to be recouped? Your Opening Balance field allows you to set the starting point for your first royalty statement to build on. This amount is stored in the Contract's Currency. In a Royalty and Flexible Profit Share deal, the Opening Balance equals the artist share. In a Classic Profit Share deal, a positive Opening Balance should equal the artist share, but a negative Opening Balance will be treated as an expense and should equal the total loss of the project. More info
- 6
- Set the Minimum Payout – Only balances that hit this minimum payment threshold will be paid to your artist. Generally implemented to avoid having to make payments that hold very little value.
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- Enable/Disable Auto-Payment – When enabled, & once the balance of the contract has reached the Minimum Payout, Curve will automatically notify you a payment is due to your artist and mark the balance as paid. When disabled, you will wait for your artists to personally invoice you their balance, & manually deduct payments made from your artist’s balance on Curve. More info
Terms Tab
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- Set your Sales Terms – The royalty rates are set within the Terms tab, & here you have the ability to pinpoint specific terms for specific use cases. The first line of a term can be read as an “if”. The second line can be read as a “then”. ie If revenue matches the given criteria, then apply the given royalty rate. More info
In a
Royalty type deal; here you specify the royalty share that should be shared with your artist. How many terms you need depends on the complexity of your artist deal. The simplest of all royalty deals will have just one general term and all sales will be applied the same royalty rate. In the example below, 50% of all revenue will be shared with your artist.
You may need to add more sales terms to your contract if you pay different royalty rates for different sales types. In the example below, 60% of all Digital revenue will be shared with the artist, all other revenue types will be shared at 50%. To any given sales line, the contract will always apply the Sales term that is most specific. The term that is deemed most specific is the term with a set condition highest up in the hierarchy. The hierarchy goes from left to right, so from Cat Type > Cat Group > Territory > Channel > Configuration > Price Category > Source.
In a
Profit Share deal; your sales term represents which revenue should be included in your profit share pool. In a standard profit share deal, you will generally include 100% of all Net Receipts and set one general sales term as per below. But you have the ability to reduce or exclude certain sale types from your profit share by adding an additional term.
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- Set your Cost terms – As per your Sales Terms; in a Royalty contract, here you specify which share of the costs is to be recouped from your artists. In a Profit Share contract, here you specify which costs are to be included in your profit share pool. More info
Add Contracts via the Excel Templates
Record labels & distributors can import Contracts using the
Contract Excel template. You can add the same metadata as you would via the interface. Once your Contract template is complete, you can import your contracts via the Import button on the Contracts page.
Additional Features
The below features are not mandatory to use, but may be helpful to clients with specific requirements. Features with a ✪ icon are available to clients on a Curve Pro plan only and may need to be enabled as an add-on.
Add Advances or Payments as a Transaction - Whenever a balance is paid to your Payee, you will need to mark this balance as paid on the Contract. More info
Store the original Contract file – Attach a pdf version of your artist deal to the Contract for your own reference.
Set a Start & End Date – Specify for your own reference the start & expiration date of your Contract. This is just for your own reference & will not affect your royalty accounting process, even when the expiration date has passed.
Categorise your Contracts – You can categorise your Contracts for your own reference. This does not impact your royalty accounting process.
More info
Catalogue specific royalty rates using Catalogue Groups – This allows you to differentiate the royalty rate from one Track/Release to another, all within the same Contract.
More info
Delay royalties using Reserves – Reserves are a temporary deduction of artist royalties, again to be released in an upcoming statement. Most commonly used with physical sales to protect the label from unsold copies being returned by the record stores.
More info
Assign a different Currency to a Contract (✪ Multicurrency) – By default you will report to your artists in your home currency. Though if you have selected additional currencies in your settings, you will be able to report to your artists in a different currency. More info
Apply a custom Statement Design (✪ Companies) – As a default, your Contract will use the statement design as specified in your Settings. But you can further customise the statement design of this contract or a group of contracts using Companies.
More info
Generate Self-Bill Invoice (✪ Self-Billing) – Automatically creates an invoice on behalf of your artist when the Minimum Payout is met.
More info
Generate Fees Invoice (✪ Self-Billing) – You will automatically create an invoice that specifies your distribution fee or commission.
More info
Deduct Withholding Tax (✪ Withholding Tax) – Deduct tax from the artist royalties.
More info
Apply Reductions or Multipliers to your sales terms (✪ Complex Sales Terms) - Further reduce or multiply the royalty rate that is set on your sales terms.
Create additional deductions (✪ Deductions) - This option allows you to set additional Deduction terms which decide under which conditions a deduction should be applied.
More info
Transfer or deduct royalties from one Contract to another using Cross-Contracts (✪ Cross-Contracts) – If you wish to deduct one artist’s royalties from another, or wish to summarise multiple contract balances onto one summary contract, you can use Cross-Contracts.
More info
Automatically attach the Contract to a label’s catalogue (✪ FTP Ingestions) – For distributors only, all Tracks/Releases from a specific Label can automatically be funnelled to that label’s Contract. More on this in our next step, creating Catalogue.
More info
Group your Term conditions (✪ Term Groups) – Simplify your Terms by using Contract Term Groups. This allows you to condition a
group of Territories, Channels, Configurations, Sources and Price Categories within the same term.
More info
Escalations (✪ Escalations) – Enables you to pay an increased royalty rate to your artist once a certain number of units or revenue has been met, or once a date has been passed.
More info
Once your Contracts are complete, please follow us to the next step of onboarding your data:
Creating Catalogue.