Art

Art Law with Artist Resale Rights or Droit de Suite

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Damien Hirst loves to combine money and art and has pinpointed a truth in the way art is sold. From a London Times article: “The first time you sell something is when it should cost the most,” he says. “I’ve definitely had the goal to make the primary market more expensive.” He compares a Prada outlet and an Oxfam shop. Why, in the world of shoes, do you pay more for a new pair from Prada, while in the world of art, the big money kicks in only when the shoes get to Oxfam?

His commentary refered to his single artist sale at Sotheby’s in September 2008 when he directly put his new artworks on the auction market rather than selling them through his gallery. The goal being to obtain full benefits himself rather than sharing with his gallery. He was upset by the Van Gogh phenomenon where the artist never got to see the recognition of his art by the public or the supplementary monetary benefits his art would have in the future. This introduces the topic of droit de suite, which when translated from French means “the right to follow” otherwise known as the artist resale rights.

Essentially, it implies the artist is entitled to a percentage (a royalty) of the final sale price as long as they’re living, or if deceased then the royalties going to heirs for 70 years after the death of the artist, or depending on the laws in your country. The buyer of the art is responsible for this payment to the aritst.

It gives artists more rights and control over their work so they’re not completely detached from a creative product once it has been sold the first time around. Not to mention the incentive to keep producing quality art works that can potentially increase in value over time. It makes sense for the artist, who originally created a work of art, to be able to profit from the art’s value as it grows and gains popularity worldwide. It also seems absurd that other artists, notably musicians and writers are fully familiar with getting benefits from resale royalties- so why make this different for visual artists? Nonetheless, the artist resale right is not without its problems.

It began with the French when the owner of the painting put up Jean-Francois Millet’s “The Angelus” at auction. The seller benefited from the full profit while Millet’s family struggled in poverty. After World War I, this was the case for many families or widows of artists killed during the war. In the 1920s the droit de suite was created as a supplementary tax art dealers or highest bidders at art auctions had to pay as a percentage of the final price in addition to other commissions.

Since this time, most European Commission countries have adopted the artist resale right, the UK recently put this into legislation, and in the US it is only implemented by California with different clauses for every country depending on how much the work was sold for, the percentage of royalties, the nationality of the artist, where geographically the sale took place, where the seller resides, and whether the artist took the initiative to track the artwork’s resale. It depends on many factors and in the UK a resale cannot exceed 12,500 euro no matter how high the resale price and doesn’t apply if the artwork is to be bought by a museum or a non-profit.

There are some concerns as to why countries have been reluctant to apply this right. It seems so apparent it should already exist for the sake of artists. First of all, there’s the risk of decreasing market competitiveness, the dealers and auction houses are afraid that by introducing the royalty it will decrease the possible prices obtained at the auction, decrease competition in the art markets, and also the primary sales of the artworks will also decrease. This is the fear and it makes sense.

If you’re an art seller and want the benefits from re-selling an artwork why would you put it in an auction in Paris or the UK if you don’t have to pay the royalty in the US? Also when buying an artwork initially you would try to get a discount since you know later on you have to pay a higher royalty. Overall this would work better if everyone complied or then the seller would really have to be an arts crusader and want some of the benefits to go back to the artist. However, it also supposedly puts the art market at a disadvantage for Europe and the UK compared to the US.

Doesn’t this sound familiar for other global initiatives? I’m thinking current position on the environment and the Kyoto Protocol, the International Criminal Court and human rights…where is the US on this one? In any case we all know how binding and enforcing those United Nations conventions actually are, and even for this one UNESCO has composed a treaty with country signatures trying to enforce this right.

Other arguments against include that this benefits the wrong artists, meaning the ones that are already established and stars (but what’s wrong with that?) This is a difficult law to enforce since the artist would literally have to track down the resale of a work of art, and this proves difficult when there isn’t much transparency in the art world.

However, maybe we will see an emergence of new small businesses operating as representatives of the artist’s rights where their primary job would be to track down resales to attribute the royalties appropriately.

For more aricles and information on artist resale rights or droit de suite please consult the search listings found on www.MutualArt.com

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