Christie’s Bulletin for Professional Advisers
The increasing regulation of the art market
Nobody likes regulation: it distracts from
the world outside of the USA, almost entirely
the business of buying and selling art,
shuts down the UK commercial trade in
increases costs and may even scupper a
ivory. It prohibits almost any ‘dealing’ in
transaction altogether. Yet its presence
ivory. Dealing appears to exclude gifts and
is something that cannot be ignored, and
inheritance, but sales, purchases and even
dealers, auction houses and almost all art
the hiring of ivory artefacts are prohibited.
Thomas Klemme Associate, Charles Russell Speechlys
market participants who avoid it are now at
Therefore, if you are thinking of entering
risk of committing serious criminal offences,
into any transaction involving either an
which could close their businesses and even
ivory item or even an item which merely
Thomas Klemme is an associate at Charles Russell Speechlys. He specialises in all aspects of art-related litigation, advising dealers and collectors as well as other art market participants.
land them in jail. This article will give a brief
contains ivory, you should think again and
overview of the recent trend to regulate the
consider carefully whether your item falls
UK art market in order to bring it in line
within one of four very limited exceptions
with other sectors of the economy, such as
under the Act. They are as follows:
finance and real estate. In particular, it will look at the Ivory Act 2018 and the stringent
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Money Laundering and Terrorist Financing
pre-1918 items of outstanding artistic etc value and importance;
(Amendment) Regulations 2019 (the ‘2019 Money Laundering Regulations’), which
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pre-1918 portrait miniatures;
•
pre-1947 items with low
came into force rapidly and recently on 10 January 2020. It will also attempt to give practical advice on how to deal and best
ivory content; and
comply with these new laws so that art markets participants can continue to do
•
pre-1975 musical instruments.
what they do best: to buy and sell works of art. Finally, it will also briefly consider
In order to deal in pre-1918 items of
the future, suggesting that this is by no
outstanding artistic value and importance,
means the end of art market regulation.
art market participants must receive a government certificate. The application
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One of the crucial points to take in is
process is not simple and it is set out in the
that committing a criminal offence is no
Act and includes the need for an accredited
longer just a matter of criminal intent and
expert opinion. All pre-1918 portrait
the purview of a few evil doers. The new
miniatures, which are limited to a maximum
money laundering laws discussed below
320cm2 in size, must be registered with the
are effectively strict liability offences and
government before an art market participant
just because an art market participant has
can deal in them. ‘Low ivory content’ means
not done something entirely reprehensible
less than 10% of the total volume and
does not mean they may not unwittingly or
even then it must be registered in order
unknowingly have committed an offence.
for an art market participant to deal in it.
In fact, as should be clear by the end of the
Finally, the musical instrument exemption
article, art market participants – including
mandates an ivory content of less than 20%
artists and agents – could be committing
of total volume and, again, the item must be
crimes simply by doing nothing.
registered before anyone can ‘deal’ with it.
The Ivory Act 2018
Failure to comply with the Act could result
In a nutshell, the Ivory Act 2018 (the ‘Act’),
in a custodial sentence of up to five years
the most stringent legislation of its kind in
and/or a fine. Crucially, it is an offence not
