5 Key Policies Music Industry Retailers and Manufacturers Should Know
Whether you’re manufacturing music products or running a music retail store, it’s important to stay informed with the various policies that may affect your business operations. This roundup includes some of the top policies relevant to companies in the music products industry.
1. Federal Music Education Funding
Summary: Title I, Title II and Title IV, Part A are federal programs with funds that can be used to support music education in schools. Specifically, Title I funds are meant to help students from low-income families meet academic standards; Title II aims to support higher-quality instruction by providing funds for teacher, principal, administrator and staff recruitment and professional development; and Title IV, Part A aims to provide students with a well-rounded education that includes music and the arts by improving learning conditions and use of technology to boost digital literacy.
How it affects music retail stores: Music retailers often rely on contracts with districts to rent instruments during the school year, as well as to outfit new and expanding band and orchestra programs. It makes financial sense for music store owners to get involved in advocating for Title I, Title II and Title IV, Part A federal dollars to be used for hiring and providing professional development for teachers and for purchasing, renting and repairing instruments.
How it affects music product manufacturers: States distribute Title I, Title II and Title IV, Part A federal dollars to school districts that may use these funds to purchase instruments, sheet music, music software and other music education-related products.
2. CITES
Summary: The Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) is a treaty between 184 countries (including the U.S. and EU) to protect endangered animals and plants from international trade practices that could threaten their existence.
How it affects music retail stores: Does your store sell vintage guitars internationally? Are you a bowed instrument player in a traveling orchestra? Do you run a shop that sells instruments that contain Brazilian rosewood, elephant ivory, tortoiseshell or other protected species? If you answered “yes” to any of these questions, then you must be able to prove that the materials used are certified as “pre-convention,” meaning, the product was produced before the materials were added to the endangered species list. Penalties vary depending on your country of origin, but can range from fines, confiscation of products, jail time and even sanctions.
How it affects music product manufacturers: If you import or export products that contain a CITES-listed species, a permit is required to prove that the materials were acquired legally. Controlled species are listed in one of three Appendices, with Appendix I being the most restrictive. Each Appendix has its own regulations and permit and/or certificate requirements.
3. General Product Safety Regulation
Summary: The European Union’s General Product Safety Regulation (GPSR) sets out to guarantee the safety of consumer products placed onto the EU market. GPSR replaces the General Product Safety Directive and introduces new measures that require additional product safety information for all non-food products. Additionally, online marketplaces are required to have an authorized representative who resides in the EU and who is the responsible party for all products sold there. The deadline for compliance is December 13, 2024, and includes requirements for all parties involved in the retail chain — from manufacturers to distributors and importers to online marketplaces and retailers.
How it affects music retail stores: Retailers selling products in the EU must comply with all GPSR regulations, such as having a single point of contact that has a physical presence in the EU and whose contact information is publicly available via product labeling. Products must also include the manufacturer’s name, trademark and address along with any warning or safety information.
How it affects music product manufacturers: Manufacturers are required to provide technical documentation outlining risk assessments and outcomes before putting products on the market. Products must provide clear instructions for use, safety information and warnings related to products and packaging. Information must also be available in the language of the country where products are sold.
4. Section 301 Tariffs
Summary: Section 301 of the Trade Act of 1974 authorizes the imposition of trade sanctions, such as tariffs, on foreign countries that violate U.S. trade agreements or engage in unfair trade practices. In 2017, a U.S. investigation concluded that China had engaged in unfair trade practices related to technology transfer, intellectual property and innovation. As a result, additional tariffs were levied in four lists of product categories, issued in phases starting in 2018.
How it affects music retail stores: Retailers and their consumers bear the costs of these tariffs. The Section 301 tariffs are extra taxes imposed on thousands of products, including musical instruments, parts and accessories, as well as electronics products used widely across the music industry.
How it affects music product manufacturers: The costs of the Section 301 tariffs fall directly on many U.S. manufacturers of musical products and other companies importing finished products, accessories and parts used in manufacture of products stateside. Many affected U.S. businesses in the musical products industry have either absorbed the costs of the tariffs or passed a portion or all the costs on to consumers. Additionally, the tariffs have disrupted supply chains, forcing companies to expend time and financial resources to seek and secure alternative suppliers. As a result, the Section 301 tariffs have left many companies with reduced resources for investment, product development and the hiring or promotion of employees.
5. Lacey Act
Summary: The U.S. Lacey Act forbids the trade of fish, wildlife or plants that have been illegally taken, possessed, transported or sold. The law also requires that all containers used to ship wildlife be properly marked and prohibits false labeling. Additionally, the Lacey Act requires the humane treatment of wildlife shipped to the U.S.
How it affects music retail stores: The Lacey Act applies to the entire supply chain, including sales and purchases of protected wood products, so the importer of record is not the only one who can be held liable. The Lacey Act requires “due care” to be applied to finding out how plant products are grown, harvested and moved through the supply chain. Therefore, retailers and manufacturers of musical instruments with wood and other plant material should be mindful of the Lacey Act’s requirements.
How it affects music product manufacturers: One way to exercise due care and demonstrate compliance is through establishing and following procedures. For example, companies should know their suppliers and (1) keep detailed records regarding the source and purchase of the product; (2) employ wood product chain-of-custody procedures; (3) collect specific documentation from the supplier about the sources of raw materials; and, (4) if feasible, enlist a third-party auditor to inspect suppliers and confirm supplier-provided information. Companies will also want to use extreme caution when dealing with those in the supply chain associated with countries of origin with lax environmental regulation and enforcement.
How it affects musicians: For vintage instruments that contain exotic wood, it can be difficult to trace the origins of the materials to ensure compliance with the Lacey Act. Such issues pose risks for performers traveling with their instruments. NAMM and partner organizations raised concerns about the adverse impacts of such circumstances. In response, the U.S. government has clarified that musical instruments imported for performance reasons do not need to be declared. However, any materials protected under CITES or the Endangered Species Act will require a permit.
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Following the rules and regulations of each country you do business in helps you avoid compliance mistakes that can lead to confiscation of product, fines, legal trouble and business disruption. Visit our Policy page for educational webinars and articles covering policy updates to remain informed.
About the Author
Claire Kreger-Boaz is the public policy manager at NAMM, where she guides high-impact lobbying efforts and member education, with a focus on music education advocacy, business compliance and workforce development. Kreger-Boaz spent more than a decade in academic publishing before joining NAMM in 2014.