The EU said it wants to make sure artists are covered throughout their lifetimes, and do not have to face a decline in income later in their later years.
The IFPI international group representing the recording industry welcomed the measure. Opera singer Placido Domingo welcomed it as "great news for performing artists."
"Established artists can benefit from their work throughout their lifetimes," he said.
Thousands of European performers who recorded in the 1960s were on the point of losing airplay royalties, and suffering a subsequent loss of income.
The move will also allow artists, who often record music in their late teens or twenties, to prevent objectionable use of their performances later on.
Monday's decision by EU ministers means that the 27 member states will have to pass the measure through their national legislation within two years.
IFPI said that the decision will also bring the EU legislation closer in line with the international standard.