Negotiating Power And Inequality In Music Industry Contracts: A Critical Analysis
- IJLLR Journal
- Apr 9
- 1 min read
Updated: Apr 18
Hiten Berwal, LLM, City St George’s, University of London
ABSTRACT
This article examines the challenges arising in the negotiation of entertainment contracts within the music industry, focusing on the imbalance of bargaining power between artists and record labels. While classical contract theory assumes agreements are freely negotiated between parties of equal standing, this assumption is largely inapplicable in this context. Structural inequalities, driven by an oversupply of aspiring musicians, high industry risk, and disparities in legal and commercial knowledge, grant record labels a dominant negotiating position. The analysis is primarily grounded in United Kingdom law, while situating the discussion within the broader global music industry.
The article explores how this imbalance leads to recurring disputes concerning remuneration, exclusivity, and creative control. It argues that mechanisms such as recoupable advances, royalty-based earnings, and broad exclusivity clauses often operate to the detriment of artists and may, in some cases, amount to unreasonable restraints of trade.
While recognising that record labels assume significant financial risk, the article contends that excessive bargaining power can be counterproductive, undermining creativity and long-term commercial relationships. It concludes that more balanced contractual practices are both equitable and commercially beneficial, reducing the likelihood of disputes and fostering sustainable success.
