It is safe to say the role of artist management has become indispensable. Besides serving as architects of an artist’s career, they oversee everything from contract negotiations to branding and global reach.

However, as crucial as their role is, the intricacies of management agreements often become a point of contention, and one of the most contentious and essential aspects of a management agreement is the Post-Term Commission or Sunset Period.

Generally, managers are paid by commission on the artist’s earnings or, rarely, on a fee basis. This fixed-fee alternative tends to be an option reserved for superstars who can afford to pay their manager away from their commission and are in a strong bargaining spot to avoid paying their managers commission from the enormous fees from their live performances and royalties earned from their music.

What is the Post-Term Commission or Sunset Period?

This commission refers to the payment a manager or management company continues to receive after their agreement with an artist has ended. As mentioned earlier, managers are paid through a commission structure from an artist’s ‘gross’ earnings. This could range from live performance fees to music royalties and endorsement deals.

The known industry standard for management commission is often 20%, though the other specifics will differ based on negotiations.

This sunset period ensures that managers are fairly compensated for their work during the agreement's term and helps balance the interests of both parties. So, while the artist benefits from the manager’s efforts, the manager is not left empty-handed if the artist’s career continues to thrive post-termination of the contract.

I believe the first thing to check in a post-term agreement as an artist is the duration. Artists should carefully review how long the post-term commission agreement or sunset period lasts.

Also, try to ensure the agreement specifies how the commission rate will be reduced over time. For example, the manager will continue to earn his/her commission at the full rate for the period of the agreement, after which the rate will reduce by 50% for five years before ceasing completely, this reflects the idea of the name SUNSET.

This structure reflects the diminishing role of the manager in generating new revenue and acknowledges that the artist may have established a strong foundation that can sustain their career independently.

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Post-Term Commission or Sunset Period?

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