Art Market Research

We  live  in  changing  times!  The  art  market  has  developed  dramatically  in  the  last  decade  due  to  an  exponential   expansion  in  the  appetite  for  acquiring  great  art  from  virtually  every  corner  of  the  globe,  advances  in  technology,   greater  access  to  information,  a  breaking  down  of  some  of  the  more  arcane  aspects  of  the  art  world  and  yes,  of   course,  those  sky  high  prices!     

Yet  despite  these  significant  and  largely  beneficial  changes,  the  art  market  remains  less  regulated  when  compared   to  the  financial  services  industry.  There  is  still  scope  for  fraud,  misrepresentation  or  perhaps  most  commonly  just   plain  misunderstanding,  all  of  which  open  up  the  risk  of  expensive  and  time  consuming  litigation.     

UK  resident,  non-­domiciled  art  collectors  who  may  have  in-­depth  experience  of  business  and  wealth  management   often  view  art  as  a  pleasure  asset  which  does  not  require  the  same  stringent  financial  disciplines  that  they  would   apply   to   other   assets.   Given   the   inherent   subjectivity   in   valuing   art,   the   scope   for   exploitation   still   abounds   particularly  if  the  collectors  do  not  take  adequate  advice  from  the  appropriate  person. 

At a recent Roundtable hosted by Sotheby's and Stonehage  at  the  end  of  2013,  an  eminent  group  of  professionals   discussed  these  matters  in  depth  through  the  use  of  a  fictitious  case  study.  In  short,  a  UK  resident  non-­domiciled   collector  needed  to  sell  a  painting  located  in  Germany,  which  he  believed  to  be  a  German  master.  Unfortunately   he  made  a  number  of  critical  mistakes,  none  of  which  are  uncommon:  he  appointed  an  adviser,  without  a  detailed   and  binding  agreement  and  failed  to  work  properly  with  that  adviser;;  he  brought  the  painting  into  the  UK  without   observing   the   correct   import   and   export   procedures;;   he   transferred   the   work   into   an   offshore   trust   without   sufficient  evidence  of  where  this  happened;;  he  then  exported  the  painting  for  authentication  by  a  leading  expert   and  having  sold  it  as  an  authenticated  German  master,  remitted  the  proceeds  to  the  UK.

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ArtBanc Intelligence - March 2013

Written by Published in Art Market Research

ArtBanc International's Quarterly publication provides important and timely articles on various aspects of the art market.

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