How to Understand a Music Contract: Guide for Artists and Managers

Introduction

Contracts are an essential part of any artist or manager's life. But let's be honest: reading them can feel like deciphering an alien language.

Here we provide you with a clear and practical guide so you can understand a music contract without being a lawyer, and sign with confidence and without unpleasant surprises.

Identify the type of contract

The first step is to know what contract you are signing.

• Check the title: it usually indicates if it is a distribution, production, management contract, etc.

• Knowing the type of contract gives you clues about your rights, obligations, and what is expected of you.

💡 Tip

If the title is not clear, ask directly or seek advice before signing. There are no silly questions when it comes to protecting your art.

Review the contracting parties

Identify who is signing with you:

• Check full legal names, IDs, and addresses.

• If someone is signing on behalf of someone else, make sure they have valid authorization (e.g., a power of attorney).

⚠️ Note

If this is not well detailed, the contract can become invalid or lead to legal issues in the future.

Analyze the term clause

The term defines how long you will be committed.

• Commonly, they range from 3 to 5 years in music contracts.

• Check if there is an automatic renewal clause: if you don’t notify 30, 60, or 90 days in advance, the contract may renew automatically.

💬 Advice

Set an alarm or reminder for the deadline to notify non-renewal. It will save you headaches!

Read your obligations carefully

Obligations are the heart of the contract.

• Make sure you understand what you must comply with.

• If you cannot meet any, propose modifying it before signing.

💡 Tip

Negotiating is not fighting: it is about protecting your work and your opportunities.

Check for exclusivity

Some contracts require exclusivity, for example:

• Original beats only for one artist.

• Digital distribution only with one distributor.

⚠️ Warning

If you sign exclusivity and work with others, you could breach the contract and face fines.

Confirm the percentages of royalties and payments

Ask and verify:

• What percentage do you receive and the other party?

• Gross or net payments?

• How often and how are payments made?

💬 Advice

Clarifying this avoids surprises and future conflicts over money.

Look for early termination clauses

The contract can terminate due to:

• Expiration of its term.

• Breach of obligations (early termination).

⚠️ Caution

In case of early termination, there may be fines or compensations. Read carefully and ensure you understand the risks.

💡 Final reflections

Understanding a music contract is not impossible: it requires patience and attention to detail.
While it's always ideal to have legal advice, this guide will help you gain confidence and autonomy to protect your career and your income.

With tools like Divisi, you can sign contracts digitally, transparently, and securely, and centralize all your documentation in one place.
That way, you can focus on what you do best: create and connect with your audience.