PUBLIC LAW 102-563—OCT. 28,1992

106 STAT. 4241

"(b) FILING OF NOTICE.—The importer or manufacturer of any Regulations,
digital audio recording device or digital audio recording medium,
within a product category or utilizing a technology with respect
to which such manufacturer or importer has not previously filed
a notice under this subsection, shall file with the Register of Copy-
rights a notice with respect to such device or medium, in such
form and content as the Register shall prescribe by regulation.
"(c) FILING OP QUARTERLY AND ANNUAL STATEMENTS OF
ACCOUNT.—

"(1) GENERALLY.—Any importer or manufacturer that dis- Regulations,
tributes any digital audio recording device or digital audio
recording medium that it manufactured or imported shall file
with the Register of Copyrights, hi such form and content
as the Register shall prescribe by regulation, such quarterly
and annual statements of account with respect to such dis-
tribution as the Register shall prescribe by regulation.

"(2) CERTIFICATION, VERIFICATION, AND CONFIDENTIALITY.—
Each such statement shall be certified as accurate by an author-
ized officer or principal of the importer or manufacturer. The Regulations.
Register shall issue regulations to provide for the verification
and audit of such statements and to protect the confidentiality
of the information contained in such statements. Such regula-
tions shall provide for the disclosure, hi confidence, of such
statements to interested copyright parties.

"(3) ROYALTY PAYMENTS.—Each such statement shall be
accompanied by the royalty payments specified in section 1004.

**§ 1004. Royalty payments

"(a) DIGITAL AUDIO RECORDING DEVICES.—

"(1) AMOUNT OF PAYMENT.—The royalty payment due under
section 1003 for each digital audio recording device imported
into and distributed in the United States, or manufactured
and distributed in the United States, shall be 2 percent of
the transfer price. Only the first person to manufacture and
distribute or import and distribute such device shall be required
to pay the royalty with respect to such device.

(2) CALCULATION FOR DEVICES DISTRIBUTED WITH OTHER
DEVICES.—With respect to a digital audio recording device first
distributed in combination with one or more devices, either
as a physically integrated unit or as separate components,
the royalty payment shall be calculated as follows:

"(A) If the digital audio recording device and such
other devices are part of a physically integrated unit, the
royalty payment shall be based on the transfer price of
the unit, but shall be reduced by any royalty payment
made on any digital audio recording device included within
the unit that was not first distributed in combination with
the unit.

"(B) If the digital audio recording device is not part
of a physically integrated unit and substantially similar
devices have been distributed separately at any time during
the preceding 4 calendar quarters, the royalty payment
shall be based on the average transfer price of such devices
during those 4 quarters.

"(C) If the digital audio recording device is not part
of a physically integrated unit and substantially similar
devices have not been distributed separately at any time