Hold the excitement

Le Freeport, Luxembourg. Image courtesy of Le Freeport.

Art insurance and storage are not meant to be exciting business. That is why art warehouses are built in places like Geneva, Singapore and Luxembourg with stable economies and political climates rather than on earthquake fault lines in unstable republics. And no one wants problems with their insurers.

This week both have been unusually exciting for the wrong reasons.

Yves Bouvier, has stepped down from the board of Luxembourg’s le Freeport to defend himself against allegations from Dmitry Rybolovlev of price fixing. The FT has a good write-up on Bouvier’s defence and it should be stressed these are just allegations. Disputes between buyers and sellers are not rare, although the publicity surrounding this case is unusual.

One of the reasons that Bouvier is getting attached is that people like attacking Freeports. One of the biggest allegations is that they are opaque and murky and the perfect place to hide works. This is unfair. In fact Freeports can only exist if they have good relations with customs and government and they have high disclosure. They are not bank deposit boxes (also being discussed following an ambitious robbery in London) and – unlike a Berlin flat (sorry) – you cannot just hide anything in them.

In fact, Judith Pearson of Aris says storage liens – where owners have not paid storage fees for works stored in Freeports  – are becoming more common (they can be protected by title insurance). Although this is a hassle for buyers, imagine the ratings for a Storage Wars type programme centred on Freeports.

In the insurance market Willis is suing former employee David Gordon and rival broker Jardine Lloyd Thompson (JLT) for moving with 20 executives to fill JLT’s jewellery, fine art and specie team. Team moves are always contentious and this must be stressful for everyone involved. Rybolovlev knows this as he is also having problems with his AS Monaco football club.