The Federation of Small Businesses and David Cameron
The Prime Minister David Cameron speaking at an FSB eventReuters

A quarter of small businesses have complained about the lack of transparency that copyright collecting societies are willing to show, according to a new report.

Research from the Federation of Small Businesses (FSB) shows that 24% of small businesses have complained to the regulator regarding a lack of clarity when it comes to obtaining music, media and design – which are often used for promotional purposes – with issues surrounding licence payments and potential copyright infringement being prominent.

The industry body says that copyright collecting societies, which protect the intellectual properties of said industries, lack clarity when it comes to rules and regulations.

It adds that there has been a lack of progress regarding transparency issues over the last year, which means that small businesses are at risk of being undermined.

John Allan, national chairman of the FSB, said: "An unexpected demand for licence payments to allow you to play music in your business can be a very unpleasant shock to some small businesses, and the industry should be sensitive in how they approach the issue.

"For trust to be built, they need to make sure they are very clear on why a licence is needed and completely transparent on how charges are calculated.

"Although collecting societies have a strong code of conduct in place, we are not convinced they are making enough progress in meeting their own standards. This research should be seen as a warning sign that without faster change, small business will start seeking stronger regulation of the industry."

Collecting societies are expected to publish a response to an independent review of their codes of conduct later this month, as laid out by their self-regulatory body the British Copyright Council.