# 37 CFR § 210.3: Accounting requirements where sales revenue is “recognized.”

> Federal · Regulations · In force

URL: https://www.frixlaw.com/law-library/statutes/ecfr-37-210.3

## Section

- **Citation:** 37 CFR § 210.3
- **Heading:** Accounting requirements where sales revenue is “recognized.”
- **Jurisdiction:** Federal
- **Kind:** Regulations
- **Status:** In force
- **Text as of:** September 22, 2026
- **Source:** Publisher's official text
- **Location:** Title 37—Patents, Trademarks, and Copyrights > CHAPTER II—U.S. COPYRIGHT OFFICE, LIBRARY OF CONGRESS > SUBCHAPTER A—COPYRIGHT OFFICE AND PROCEDURES > PART 210—COMPULSORY LICENSE FOR MAKING AND DISTRIBUTING PHYSICAL AND DIGITAL PHONORECORDS OF NONDRAMATIC MUSICAL WORKS > Subpart A—Royalties and Statements of Account Under Non-Blanket Compulsory License

## Text

Where under § 210.2(g)(3)(i), revenue from the sale of phonorecords is “recognized” during any month after the month in which the compulsory licensee actually first parted with their possession, said compulsory licensee shall reduce particular phonorecord reserves by the number of phonorecords for which revenue is being “recognized,” as follows:
(a) If the number of phonorecords for which revenue is being “recognized” is smaller than the number of phonorecords comprising the earliest eligible phonorecord reserve, this phonorecord reserve shall be reduced by the number of phonorecords for which revenue is being “recognized.” Subject to the time limitations of § 210.2(g)(3)(ii), the number of phonorecords remaining in this reserve shall be available for use in subsequent months.
(b) If the number of phonorecords for which revenue is being “recognized” is greater than the number of phonorecords comprising the earliest eligible phonorecord reserve but less than the total number of phonorecords comprising all eligible phonorecord reserves, the compulsory licensee shall first eliminate those phonorecord reserves, beginning with the earliest eligible phonorecord reserve and continuing to the next succeeding phonorecord reserves, that are completely offset by phonorecords for which revenue is being “recognized.” Said compulsory licensee shall then reduce the next succeeding phonorecord reserve by the number of phonorecords for which revenue is being “recognized” that have not been used to eliminate a phonorecord reserve. Subject to the time limitations of § 210.2(g)(3)(ii), the number of phonorecords remaining in this reserve shall be available for use in subsequent months.
(c) If the number of phonorecords for which revenue is being “recognized” equals the number of phonorecords comprising all eligible phonorecord reserves, the person or entity exercising the compulsory license shall eliminate all of the phonorecord reserves.
(d) Digital phonorecord deliveries shall not be considered as accompanied by a privilege of return as described in § 210.2(g)(3), and the compulsory licensee shall not take digital phonorecord deliveries into account in establishing phonorecord reserves.
[79 FR 56206, Sept. 18, 2014. Redesignated at 85 FR 58143, Sept. 17, 2020]

## Nearby sections

- [37 CFR § 210.1 § 210.1 General.](https://www.frixlaw.com/law-library/statutes/ecfr-37-210.1.md)
- [37 CFR § 210.2 § 210.2 Definitions.](https://www.frixlaw.com/law-library/statutes/ecfr-37-210.2.md)
- [37 CFR § 210.3 § 210.3 Accounting requirements where sales revenue is “recognized.”](https://www.frixlaw.com/law-library/statutes/ecfr-37-210.3.md)
- [37 CFR § 210.4 § 210.4 Accounting requirements for offsetting phonorecord reserves with returned phonorecords.](https://www.frixlaw.com/law-library/statutes/ecfr-37-210.4.md)
- [37 CFR § 210.5 § 210.5 Situations in which a compulsory licensee is barred from maintaining reserves.](https://www.frixlaw.com/law-library/statutes/ecfr-37-210.5.md)
- [37 CFR § 210.6 § 210.6 Monthly statements of account.](https://www.frixlaw.com/law-library/statutes/ecfr-37-210.6.md)
- [37 CFR § 210.7 § 210.7 Annual statements of account.](https://www.frixlaw.com/law-library/statutes/ecfr-37-210.7.md)
- [37 CFR § 210.8 § 210.8 Documentation.](https://www.frixlaw.com/law-library/statutes/ecfr-37-210.8.md)
- [37 CFR § 210.9 § 210.9 Harmless errors.](https://www.frixlaw.com/law-library/statutes/ecfr-37-210.9.md)
- [37 CFR § 210.10 § 210.10 Statements required for limitation on liability for digital music providers for the transition period prior to the license availability date.](https://www.frixlaw.com/law-library/statutes/ecfr-37-210.10.md)
- [37 CFR § 210.11 § 210.11 Record companies using individual download licenses.](https://www.frixlaw.com/law-library/statutes/ecfr-37-210.11.md)
- [37 CFR § 210.21 § 210.21 General.](https://www.frixlaw.com/law-library/statutes/ecfr-37-210.21.md)
- [37 CFR § 210.22 § 210.22 Definitions.](https://www.frixlaw.com/law-library/statutes/ecfr-37-210.22.md)
- [37 CFR § 210.23 § 210.23 Designation of the mechanical licensing collective and digital licensee coordinator.](https://www.frixlaw.com/law-library/statutes/ecfr-37-210.23.md)

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Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/ecfr-37-210.3. Check the current official text before relying on it. Not legal advice.