… and change

The groan you can hear in the air is probably the tectonic plates of the art economy starting to shift. There’s Webb’s plucky experiment with the turnover model in Parnell, the fallout from the Bambury/Jensen settlement, Bowerbank/Ninow testing a dealer auction mash-up, My art offering collectors interest-free cash to buy stuff with, a corporate taking over the Auckland Art Fair and some very sharp words dissing auctions from the world of art dealers.

'If you are wanting to start an art collection, to go to an auction to buy the art is bad practice. You won’t get the best examples and you won’t learn anything: the work is a product, which is an anathema to us.

There are all sorts of pressures that go with auctions, let alone the competition. If you are bidding against one other maniac you will overpay – it’s too dangerous.' 
Dealers Tim Melville and Emma Fox reported in NZ Herald on Saturday
 
Ouch.

Finally there’s a cash and carry online model for art and collectibles being set up by the Fairfax Group of all people. And the media barons look as though they're going straight for the jugular with the simple proposition 'Get Stuff' riffing on the name of their eponymous website. In a sample Facebook page (you can see it here) for instance you could bid for a work by Rohan Wealleans starting with an opening bid of $800 or use the 'buy now' feature and get it directly off the shelf for $1,800. It's a technique that makes most art dealers go pale but in this case at least one (Ivan Anthony) is in on the game with his artists and contact details featuring as the art part in the launch offering. So, as far as art's concerned, even though the site is presented as an auction, the chances of getting a bargain look kind of remote. 

Image: Yvonne Todd. Buy now

The returning

The new Bowerbank Ninow Gallery (set to open late November on K-Road) is promising a return to artists on the hammer price of works it sells at auction. Back in 2007 the attempt to legislate a return to artists on resales fell over in New Zealand after some forceful lobbying from dealer galleries. EU countries (including the UK) have had schemes in place since 2006 and Australia introduced its own version in 2010 covering works selling for more than $1,000. The proposal in NZ was for artists to have an inalienable right to 5% royalties on all resales. Now, according to Louisa Gommans in the Law Society's LawTalk, the debate is back. The issues are pretty much as you'd expect (an administrative nightmare, pressure on high value works, chiseled profit margins) but Bowerbank Ninow are diving in anyway. Their recent press release makes it unclear as to whether they intend this scheme to cover other secondary sales they undertake as well but presumably it will. As it stands, a work hammered down on the night by Bowerbank Ninow for $20,000 would return $450 to the artist.

The 5 percent solution

The Government is acting on its promise to introduce a resale royalty on the sale of artwork. The Copyright (Artists' Resale Right) Amendment Bill was introduced into Parliament today.

In its present form the legislation, if passed, will mean visual artists receive a 5 percent royalty payment each time one of their original art works (if worth more than $500) is resold commercially, through any auction house, gallery, dealer, or other intermediary or professional involved in the business of dealing in works of art. The royalties will be owed on work sold during the artist’s lifetime and for 50 years after the artist’s death.

Let them eat cake

When dealer galleries raised their commissions from 33 and 1/3 percent to 40 percent, it didn’t spell the end of the line for dealers, artists or collectors. Later, when the auction houses went for buyer and seller premiums, sales went up not down. But suggest that artists get a share of the spoil and all hell breaks loose. Suddenly it is all our duties to protect market forces and predictions of doom are rife if we don’t.

So what really happens when a percentage of resale is given back to artists?

This from artnet: “Britain’s new resale royalty law, which grants living artists a portion of the proceeds when their artworks are resold by art dealers or auction houses, turns one year old on Feb. 14, 2007. Opponents of the measure, which was prompted by British participation in the European Economic Union, feared that the new tax -- also known by its French name, droit de suite -- would damage the country’s art market and drive business to the U.S. and Switzerland. Has that been the case?

“Au contraire. London’s contemporary art business is stronger than ever. ‘Sales have been as healthy as they were before the law came into effect,’ said Glenn Scott-Wright, director of London’s Victoria Miro Gallery. ‘Clients haven’t indicated that they were unwilling to buy because of the royalty. In fact, there hasn’t really been much discussion of the law at all.’

“British auctioneers have reported similar results. Pilar Ordovas, head of Christie’s contemporary art department in London, stated that 2006 brought ‘the best sales ever in contemporary art in our history.’ As far as paying royalties on sales, she said, ‘Nobody seems to be concerned.’”
Thanks to Russell Brown for pointing to this response.

Give and take

We have always been big supporters of the idea that artists get some monetary return on the resale of their work. In our experience the rising value of art has little to do with the walls it hangs on or the people who come to own it. Instead the value is a recognition of what the work means to the culture and this determination is invariably based on the growing reputation of the artist plus their ongoing production. If that's the case, it has always seemed to us only fair that the person most responsible for this rise in value should get a share when that value is realised. So we are very pleased to see the Government through the Ministry of Culture and Heritage has issued a fascinating discussion paper on resale rights for visual artists looking at many international examples. You may also be entertained by the varying estimates on the size of the NZ art market each year (from Peter Webb's $40-50 million including both first sales and resales to an $80 million punt from John Daly-Peoples).

The Ministry's paper includes a heavy duty questionnaire that you can respond to. We can't promise to answer all the questions but we certainly plan to tackle some of them. You can read the discussion paper here.