The art market is a difficult place in which to manoeuvre without the right guidance. And there are many things new players are expected to know. For instance, art transactions can sometimes go wrong due to unverified paintings or identities. It has taken eight years for a dispute over a forged Frans Hals portrait to be settled.
Further, with the EU’s new (the fifth) Anti-Money Laundering Directive (AMLD5) set to become law on January 10, 2020, buyers and sellers should understand what art deals entail.
So, to help make life easier for newcomers, here is some free advice from some of the leading lawyers in the art industry:
What is one piece of advice you would give first-time buyers and sellers?
“Decide with your eyes and your heart, but seek early for the advice of a professional.”
Andreas Ritter, Ritter & Partner
“Become an art collector for aesthetic considerations not for investment returns. Certainly, there is a chance of making profits on art, but the cons outweigh the benefits. Art often means no liquidity; it is difficult to sell and the chance of buying the right stuff is slim. Moreover, the art market is not yet regulated as a result of which, you cannot rely on accurate data to corroborate your investment decision.”
Oliver Lenaerts, Contour Law
“Trust to your instincts but go with a friend.”
William Hancock, Collyer Bristow
What did you learn from your worst case?
“Do not let your client select the barrister in litigation and challenge the barrister until you are comfortable that their strategy stands a good chance of winning.”
Pierre Valentin, Constantine Cannon LLP
How do you think the new Anti-Money Laundering Directive (AMLD5) will affect the art market?
“I try to look at this in positive way. It will certainly create a further burden on galleries, dealers and intermediaries, but I don’t think that it will dramatically change if they are already complying with the laws. In Italy, for instance, the obligation to identify your client already exists.
“There is a law that was approved in the 1930s that obliges an intermediary to register in a special register. You know, maybe one day this register will be online. Today it is still a paper document to identify the consigner.”
“I am very much in favour of the principles that the beneficial owners should always be identified. And I think that in major international auctioneers already do this. I think it is important to fight against money laundering.”
Giuseppe Calabi, CB&M Partners