Before any buyer writes a check for your music catalog, they will verify 12 key areas — ownership, royalty history, contracts, legal status, and more. Understanding this checklist before you go to market is one of the most effective ways to accelerate your sale, avoid last-minute deal breaks, and maximize your valuation. This guide walks through every item from the seller’s perspective.
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Why Due Diligence Determines Your Deal
In the music catalog M&A market, due diligence is where deals close — or collapse. A catalog that looks clean from the outside can take months to clear if ownership records are incomplete, PRO registrations have wrong splits, or an old co-writer claim resurfaces.
Buyers are paying 10x–18x annual income for assets with 70+ year copyright lives. They cannot afford to discover a chain-of-title problem after closing. Their legal and financial teams conduct exhaustive reviews, and any issues they find become either a price reduction, a deal condition, or a deal-killer.
The good news: most due diligence issues are fixable. They just take time. The sellers who get the best outcomes are those who self-audit before going to market — identifying and resolving issues before a buyer’s team discovers them.
This checklist is organized in the same order a typical buyer’s diligence team works through a catalog.
The 12-Point Due Diligence Checklist
1. Verify Ownership and Chain of Title
This is the foundational question: who legally owns the rights you’re trying to sell?
Buyers need a complete “chain of title” — a documented history of how ownership of each copyright reached you. Every transfer, assignment, inheritance, or reversion must be documented.
What sellers should prepare:
- Original copyright registration certificates from the US Copyright Office (or equivalent in your country)
- All assignment agreements (if you acquired rights from another party)
- Any co-authorship or work-for-hire agreements
- Evidence of estate transfers if rights were inherited
- Documentation of any reversion of rights (Section 203 recaptures, for example)
Common problems and how to fix them:
- Undocumented oral agreements: A verbal deal where you “traded” rights with a collaborator years ago needs to be formalized in writing before a buyer accepts it. Get a retroactive written agreement.
- Missing old assignments: Dig up old publishing deals. Many independent artists from the 1990s–2000s signed deals they’ve forgotten about, which may still assign a portion of rights to a dormant publisher.
- Rights inherited through an estate: If you’re managing a deceased artist’s catalog, you need probate documentation, letters testamentary, and formal evidence of the inheritance chain.
2. Check Copyright Registrations
Federal copyright registration is technically optional in the US (copyright exists automatically on creation), but it is strongly expected by catalog buyers — and required for enforcement.
What buyers check:
- Is each song registered with the US Copyright Office (or national equivalent)?
- Are the registrations accurate — correct authors, correct year, correct ownership percentages?
- Are sound recordings and compositions registered separately?
How to self-audit: Search the US Copyright Office’s online catalog at copyright.gov. Search by song title, artist name, and registration number. Verify that each work in your catalog has a registration on record.
Pro tip: If registrations are missing or inaccurate, file corrections before going to market. The US Copyright Office processes registrations within 3–6 months (expedited service available for active transactions).
3. Review PRO Registrations (ASCAP, BMI, SESAC)
Every song must be registered with your Performing Rights Organization — and the registration must reflect the correct ownership splits. This is where a surprising number of catalogs have errors.
What buyers check:
- Is every song in the catalog registered with your PRO?
- Are the writer and publisher splits correctly recorded?
- Are co-writers registered at their correct PROs? (ASCAP writers and BMI writers must each register their own shares at their own PRO)
- Is there any conflict between your PRO registration and a co-writer’s registration?
How to self-audit: Log into your PRO account and run a title-by-title audit. Check:
- Title is spelled correctly (title disputes are more common than you’d think)
- Your share percentage is correct
- Your publisher is listed correctly (or you are listed as self-published)
- No “conflict” flags on any works
For international collection, ensure your PRO has active reciprocal agreements with collection societies in key markets (PRS in UK, GEMA in Germany, SOCAN in Canada, JASRAC in Japan). If your catalog earns significant foreign income, consider whether you have an active international sub-publisher.
Missing PRO registrations are one of the most common and costly due diligence problems. Unregistered songs generate no verified income — buyers simply won’t pay for income that can’t be confirmed.
4. Obtain 3–5 Years of Royalty Statements
Royalty statements are the financial evidence that your catalog’s income is real, recurring, and attributable to specific works.
What buyers require:
- Complete royalty statements from all sources: PRO, MLC (mechanical), SoundExchange (neighboring rights), distributors (for masters)
- Minimum 3 years; 5 years preferred; 7 years ideal for premium multiples
- Statements must be itemized by work — not aggregated lump sums
- Both US and international statements if applicable
How to prepare: Organize statements by year and source. Create a spreadsheet that aggregates NPS (Net Publisher’s Share) by year for your publishing catalog, and NLS (Net Label’s Share) by year for masters.
Calculate:
- Year-over-year trend (Trend Rate)
- 3-year average
- Last Twelve Months (LTM)
For a full explanation of how these numbers feed into your valuation, see: How Much Is My Music Catalog Worth? A Step-by-Step Valuation Guide.
Pro tip: Buyers will request the raw statements themselves — not your spreadsheet summary. Have original documents (PDFs, portal exports) available.
5. Analyze Income Trends: Stable, Growing, or Declining
Beyond confirming what the income has been, buyers model what it will be. Your historical income trend is the primary input for their projection models.
What buyers analyze:
- Year-over-year growth or decline rate (Trend Rate)
- Income source mix: is it shifting toward or away from streaming?
- Platform concentration: is one platform generating 80%+ of income?
- Seasonal patterns or anomalies
How sellers can strengthen their trend story:
- If income has been growing, quantify the growth rate: “Our catalog has grown 11% per year over the past three years.”
- If income dipped in a specific year, explain why — a catalog reregistration delay, a distribution switch, a temporary sync lull. Document the explanation.
- If income has been declining, be honest about it. Buyers will find it in the statements regardless. Unexplained declines are more concerning than explained ones.
Identify income sources: A catalog earning 70% from streaming and 30% from performance is structurally healthier than one earning 50% from physical/download sales. Streaming income is durable and growing; physical income is in structural decline.
6. Identify Income Sources by Type and Geography
Buyers want to understand not just how much your catalog earns, but from where — because different income types have different durability and growth profiles.
Income breakdown buyers want:
| Source | Type | Why Buyers Care |
|---|---|---|
| Streaming (on-demand) | Master + publishing | Growing, durable, cross-platform |
| Terrestrial radio | Publishing only | Stable but static (no streaming growth) |
| Digital performance / SiriusXM | Master (via SoundExchange) | Steady, SoundExchange-confirmed |
| International PRO income | Publishing | Signals global penetration |
| Sync placements | Master + publishing | High-value but variable |
| Physical/download | Master + publishing | Declining; treated skeptically |
| Publishing | Small but steady for well-known songs |
Geographic breakdown: If you collect significant income from the UK, Europe, or Asia — document this separately. International diversification is a positive signal. Buyers also look for “dark territories” — countries where your songs are likely performed but you’re not collecting. This is an upside opportunity they may factor into their offer.
7. Review All Contracts
Every contract that touches your catalog must be reviewed for:
- Term (when does it expire?)
- Rights granted (exclusive vs. non-exclusive? Specific territories?)
- Revenue splits (how much do you keep?)
- Transferability (can the rights be assigned to a new owner?)
- Restrictions (are there things the owner can’t do?)
Contract categories to compile:
- Publishing administration agreements
- Co-publishing agreements
- Recording contracts (major label, indie label, or distribution)
- Distribution agreements (digital and physical)
- Sync licensing agreements (especially ongoing/blanket licenses)
- Sample clearance agreements
- Collaboration/co-production agreements
- Management agreements that include any rights components
Transferability is critical: Some older publishing contracts have language that requires the original publisher’s consent to assign the deal to a new buyer. If your publishing admin agreement can’t be transferred, the buyer is acquiring rights that are temporarily trapped in an existing agreement.
Red flags buyers look for:
- Non-standard revenue splits that are unfavorable to the catalog
- Clauses that restrict future licensing or sync opportunities
- Right-of-first-refusal provisions that complicate the sale
- Automatic renewal clauses that extend unfavorable terms
8. Check for Transfer Restrictions
Even if you own the rights outright, some agreements contain provisions that restrict your ability to transfer or sell them.
Common transfer restrictions:
- Consent requirements: Some contracts require a co-publisher, co-writer, or label to approve any sale
- Right of first refusal (ROFR): A former publisher or label has the right to match any third-party offer before you can sell
- Right of first negotiation (ROFN): You must negotiate with a specific party first before going to market
- Lien/security interest: A prior creditor may have a lien on the catalog that must be discharged before transfer
How to identify these: Read every existing agreement with legal counsel, specifically looking for assignment restriction clauses. If a restriction exists, determine:
- Has the restriction period expired?
- Can the restriction be waived by the counterparty?
- Does the restriction survive termination of the underlying deal?
9. Look for Co-Writer and Co-Publisher Agreements
Co-ownership is the most common structural complexity in catalog M&A. Every co-written song introduces at least one other rights holder whose cooperation may be needed.
What buyers verify:
- Written agreements confirming each co-writer’s share percentage
- Co-publisher agreements (if any)
- That co-writers’ shares are not encumbered by conflicting agreements
- That co-writers don’t have ROFR or consent rights over your share
A scenario buyers fear: You own 50% of publishing on a co-written song. The other 50% is owned by your former bandmate. That former bandmate signed a deal with a major publisher — which means the major publisher has to consent to any transaction involving their share. Suddenly your co-written song requires a four-party deal instead of two.
How to prepare:
- Get signed written agreements with all co-writers documenting the percentage split
- Clarify whether any co-writer’s share is covered by a third-party publishing deal
- For songs with multiple co-writers, map out the full ownership structure before presenting to buyers
10. Verify No Outstanding Legal Disputes or Liens
Any pending litigation, unsettled claims, or financial liens on the catalog will halt a deal until resolved — or result in significant price reductions to account for the contingent liability.
What buyers check:
- Copyright infringement claims (past or present)
- Sampling disputes (did your recording sample someone else without clearance?)
- Plagiarism allegations
- Co-writer disputes over credit or splits
- Label contract disputes
- UCC filings / liens (has the catalog been used as collateral for a loan?)
How to self-audit:
- Review your own correspondence for any unresolved disputes
- Check if any past co-writer or collaborator has made any claim over your works
- Search for UCC filings against your name or entity at the Secretary of State level
- Confirm with your attorney that no copyright infringement suits are pending
Important: Even settled disputes can raise flags. Have documentation showing the dispute was resolved and the resolution terms.
11. Assess Future Potential: Sync Opportunities and Genre Trends
Buyers are making a forward-looking investment. They will assess not just what your catalog has earned, but what it could earn.
What buyers evaluate:
- Sync potential: Are these songs stylistically flexible for advertising, TV, film? Have they been placed before? What genres are currently in demand for sync?
- Genre trajectory: Is your genre growing (Latin pop, bedroom pop, lo-fi hip-hop) or declining (mid-2000s mall punk)?
- Playlist placement: Is the catalog appearing on editorial playlists on Spotify or Apple Music? This signals algorithmic favor and ongoing streaming growth.
- Fan base and artist presence: An active artist with a social following who continues to drive catalog discovery can lift income for the buyer post-acquisition.
- Emerging uses: Short-form video (TikTok, Reels) and UGC platforms are generating new income streams. Songs that trend on short-form video see streaming spikes.
How sellers can strengthen this narrative:
- Document sync placements with platform, year, and fee received
- Show streaming data from Spotify for Artists or similar platforms demonstrating trend
- Highlight any songs that have had viral or trend moments on social media
12. Evaluate Territorial Coverage and Collection Efficiency
International under-collection is endemic among independent artists. Buyers who have robust international infrastructure know this — and it affects both valuation and deal interest.
What buyers check:
- Does the catalog collect in all major markets? (US, UK, Germany, France, Japan, Australia)
- Are sub-publishing agreements in place, or does the PRO’s reciprocal network cover it?
- Are there “dark territories” — countries where the songs are popular but income is not being collected?
- Is SoundExchange registered for neighboring rights?
The collection efficiency opportunity: If your catalog earns 80% from the US and virtually nothing internationally — but your music is streamed in the UK and Europe — a sophisticated buyer with international infrastructure can unlock significant incremental income. This upside potential can be a positive deal driver.
How to audit your territorial collection: Check your PRO account for international royalty payments. If you’re receiving little to no international income but have streaming plays in international markets (check Spotify for Artists geographic data), you likely have a collection gap.
Putting It All Together: A Pre-Sale Preparation Timeline
Based on the 12-point checklist, here is a realistic pre-sale preparation timeline:
| Phase | Timeline | Tasks |
|---|---|---|
| Initial audit | Month 1 | Compile royalty statements, PRO review, identify gaps |
| Legal cleanup | Month 1–2 | Fix PRO splits, register missing copyrights, formalize co-writer agreements |
| Contract review | Month 1–2 | Review all agreements with legal counsel, identify transfer restrictions |
| Documentation package | Month 2–3 | Organize chain of title, statements, registrations into a clean data room |
| Go to market | Month 3+ | Present catalog to buyers with clean documentation |
Catalogs that go to market with a well-organized due diligence package close faster and with higher offers. Buyers pay a premium for certainty.
Common Due Diligence Surprises (And How to Avoid Them)
Surprise 1: A forgotten publishing deal that’s still technically active Many artists signed short-term admin deals in the early days of their career and assumed they expired. Check every agreement you’ve ever signed. If a deal’s term is unclear, have an attorney confirm its status.
Surprise 2: PRO registrations showing wrong publisher If you changed your publishing entity (from one LLC to another, or from admin’d to self-published), old registrations may still list the former publisher. Update all PRO records before going to market.
Surprise 3: A sample that was never cleared If one of your songs samples another work without a formal clearance agreement, the sampled work’s owner could have a claim. Get clearances documented and executed before a buyer’s legal team surfaces the issue.
Surprise 4: A foreign co-writer whose agreement is missing International collaborations often happen informally. If you wrote a song with a co-writer in another country and the splits were agreed verbally, get a written agreement — ideally with a document notarized in their jurisdiction.
Ready to Run Your Pre-Sale Audit?
The sellers who get the best prices are the ones who show up prepared. Run through this checklist yourself first — ideally with a music attorney — before presenting your catalog to buyers.
For context on what buyers pay once due diligence is complete, see: Music Catalog Multiples Explained: NPS, NLS, and What Buyers Actually Pay.
Ready to find out what your catalog is worth? Use our free Music Catalog Valuation Calculator — and get guidance on any due diligence issues that could be affecting your price.
Frequently Asked Questions
How long does due diligence take when selling a music catalog?
A simple, clean catalog with organized documentation and no legal complications typically takes 30–60 days to clear buyer due diligence. Complex catalogs — with multiple co-writers, international rights, existing agreements, or any legal history — commonly take 90–180 days. Having your documentation organized before going to market significantly reduces this timeline.
Do I need a music attorney for catalog due diligence?
For any catalog valued at $100,000+, a music attorney is strongly recommended. They can identify chain-of-title issues, review contract transferability, flag potential infringement exposures, and negotiate protective representations and warranties in the final purchase agreement. The cost of legal counsel is small relative to the risk of an undiscovered issue.
What happens if a due diligence issue is found after a deal is signed?
Most catalog purchase agreements include representations and warranties from the seller: you warrant that you own what you’re selling, there are no undisclosed disputes, registrations are accurate, etc. If a post-closing issue emerges that contradicts your representations, the buyer may have legal recourse. Undisclosed issues can result in deal rescission or damages claims. Disclosure before signing is always better.
Can I sell a catalog with an ongoing co-writer dispute?
It depends on the severity. A minor dispute over a small catalog share can sometimes be dealt with via escrow (holding back a portion of the purchase price pending resolution). A major dispute — particularly one involving the primary songs in the catalog — will likely block the deal until resolved. Buyers will not assume undetermined legal liability.
What is a data room, and do I need one?
A data room is a secure, organized digital repository of all documents relevant to the catalog: royalty statements, copyright registrations, PRO records, contracts, and chain-of-title documentation. Major buyers expect one. For smaller deals, a well-organized shared folder (Google Drive, Dropbox) with clear labeling can serve the same purpose. Having a complete data room signals professionalism and accelerates the buyer’s review process.
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