CONFERENCE REPORT INSTITUTE OF ART AND LAW STUDY FORUM: London, Saturday 23rd February 2019.
| Author | Gould, Emily |
| Position | Conference notes |
The Institute of Art and Law's Spring 2019 Study Forum, held in central London on 23rd February, covered a wide variety of subject matter and included presentations from those in the fields of legal practice, business, education and academia.
Christine Burron, the CEO of Pi-Ex Ltd, (1) teamed up with Azmina Jasani, solicitor at Constantine Cannon, to discuss auction house practices and third-party guarantees. These guarantees are an increasingly common phenomenon in high-value auction sales. In their simplest form, they typically involve a third party, in return for a fee, agreeing to purchase a lot at a pre-determined price in the event that the bidding fails to reach that sum. The seller is assured of a sale, as is the auction house (thus guaranteeing a commission and helping to attract future consignors), and the third-party guarantor receives its fee plus either the lot itself or, potentially, a share in any 'overage' (the amount by which the sale price exceeds the guaranteed sum). The precise mechanisms by which these transactions operate vary between auction houses and are not always entirely transparent--one of the aspects of these financial instruments which has resulted in a degree of controversy regarding their use from some quarters. The detailed examination of the legal intricacies behind these arrangements presented by Azmina Jasani certainly penetrated the fog which may have surrounded the topic for many of the event's delegates. The legal analysis complemented Christine Burron's fascinating insight into the commercial landscape to provide a thorough review of this increasingly significant area for the worlds of fine art and finance.
The financial aspects of art transactions were further explored by Janet Ulph, Professor of Commercial Law at Leicester University, who spoke on the recent anti-money laundering regulations (2) and their potential impact on the arts sector. Professor Ulph started by noting the importance of a recent UN Security Council Resolution (2347 of 2017), condemning the looting and smuggling of cultural property, notably by terrorist groups. The Resolution calls on governments to engage with the museum sector and art trade on 'differentiated due diligence' and other measures 'to prevent the trade of stolen or illegally traded cultural property.' The talk focused on this issue of due diligence, examining the extent to which the new regulations will require an enhanced level of scrutiny within both the...
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