Art dealer Niall Fairhead is leading a new campaign to persuade the Government to raise the Artist’s Resale Right threshold from €1000 to the €3000 stipulated by the European Commission.
Mr Fairhead, who spearheaded a similar
campaign this time last year by setting up an online petition and
persuading thousands of people to send specially designed postcards
to then culture secretary Jeremy Hunt, says recent surveys by the
leading trade associations show how badly the industry is being
The costs and administrative burden
for both dealers and the collecting societies far outweigh any
benefits to artists below the €3000 threshold, he says. And he
added that the latest survey figures show just how "grossly
inaccurate" the Design and Artists Copyright Society (DACS) were in
underestimating these costs when persuading the then Labour
government to lower the anticipated threshold from the €3000
stipulated by the EC Directive to €1000 in 2006.
This 'gold-plating' of the Directive
also went directly against Government policy.
In 2005, in the run-up to the levy's
introduction, DACS submitted evidence to the Government claiming
the administrative costs to the trade per transaction for
collecting and paying ARR would be about £1, but even then industry
figures estimated that they would be around £30-40. The latest set
of surveys put it at around £50 - and that is without factoring in
DACS' own costs related to the transactions and
Now Mr Fairhead and fellow dealers
have drawn up a report showing these effects, which they have
submitted to Viscount Younger of Leckie, parliamentary under
secretary of state for intellectual property, in the hope of a
change of heart.
This impact assessment study is being
considered by the Intellectual Property Office, who are keen for
interested parties to contribute their thoughts and evidence before
the Government assesses the claims further.
A survey of around 20 members of The
Association of Art & Antiques Dealers (LAPADA), The British
Antique Dealers' Association (BADA) and the Society of London Art
Dealers (SLAD) compiled in December 2012 showed it takes an average
of just under an hour and 20 minutes to complete the task of
administering a single transaction involving ARR payment, with the
overall cost averaging £50.85. Earlier surveys showed similar
When it comes to costs incurred by
DACS, their 2010 Westminster Briefing reveals that they made around
29,160 individual payments to beneficiaries, at an average of £360
DACS stress that they are a
not-for-profit organisation, so their 15% fee can be presumed to
reflect the costs of administering the ARR payments. If that is so,
in order to pay out £360, they must have collected £423.50, putting
their collection and distribution costs per transaction at an
average of £63.50.
Together with dealer costs, this makes
an average overall cost per transaction fulfilment of £114.35,
equivalent to more than 30% of the average payment.
This indicates that DACS must be
losing money on lower-end transactions - the sale of a picture at
€1000 generates €40 (around £28) in ARR, for instance - with the
costs far outweighing actual payments to artists.
"The extension of ARR to the work of
deceased artists in 2012 has added to the cost burden, as four
times the number of sales are now liable to ARR than was the case
before," states Mr Fairhead and his colleagues' submission to the
"Small businesses in the art market
were disproportionately affected by the decision to introduce a
lower threshold, since they are most active in the market at lower
He further advises: "There is no
requirement in the Directive to apply ARR to art sales below €3000
and therefore the British Government is free to restore the
threshold without recourse to the European Commission. Doing so
would bring UK law in line with the precise requirements of the EC
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