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The new gallery will open officially on October 15 in the heart of New York’s most prestigious art dealing district at 21 East 67th Street, between Madison and Fifth Avenues. The 3500 sq ft premises, consisting of a ground and first floor, was once Colnaghi’s New York outlet and the English art dealers Hall and Knight are in the same building.

The new branch will specialise in Impressionist, Post-Impressionist and contemporary art while Frost & Reed’s gallery in King Street, St. James’s will continue to deal in 19th and early 20th century British and European paintings.

A growing number of London antique and art firms are opening in New York and this seems a logical step for Frost & Reed, who were founded in 1808 and have business links with the United States going back to 1884 when Walter Frost crossed the Atlantic with a stock of engravings.

The gallery’s client base today is largely American and they already exhibit at major American fairs.

Last week Tony Nevill, managing director of the gallery, told the Antiques Trade Gazette that the move is linked to the increasing burden of taxes and bureaucracy imposed on the British art market by European Community legislation. He cited in particular droit de suite, the artist’s resale tax, which will be levied on most contemporary picture sales from 2006, and the imposition of VAT on paintings imported from outside the EU, as factors making life in the London art trade increasingly dificult.

He said: “Pictures bought in New York will stay there. Those bought here and liable to droit de suite will go to New York.”

And will the London gallery close? “Not if we can help it,” says Mr Nevill, who added: “bureaucracy is against the art dealers of London and as things get more difficult rents and rates just go up.”