Controlled Composition Clause

Some recording contracts contain a clause that limits the amount of mechanical royalties paid by record labels for songs written, co-written, or owned by the performing artist whose album it appears on. The record company and publisher often agree to pay a reduced rate, usually 75% of the statutory rate, for the songs or shares of songs written by the recording artist. Additionally, there may be a cap on the total mechanical royalties paid per album sale, which is generally equivalent to 10 tracks.