1 The auctioneer
The German auction scene is not regulated nationally, but on a regional basis. The job title is not protected by law – anyone can apply for a licence, as long as they have a financially secure background and no criminal record (in the last five years). Applications are addressed to the local Ordnungsamt or regulatory office, which issues a licence to hold auctions. After several years an auctioneer can apply to become publicly appointed and sworn auctioneer, enabling them to carry out sales at the behest of the courts or state authorities.
2 Trade association
Most of the leading German auctioneers are members of the Bundesverband deutscher Kunstversteigerer (BDK), an association founded in 1969. Members adhere to a common code of practice. The BDK was in the forefront of protests against the controversial Kulturgutschutzgesetz, which came into force in August 2016.
3 The Kulturgutschutzgesetz
As of 2016, this law – designed to protect ‘cutural property’ – requires works of art that are over 75 years old and have a value of more than €300,000 to have an export licence. However, the law also asks, in the case of a legal dispute, that the owners of ‘cultural goods’ with a value of at least €2500 provide proof of the item’s provenance for the previous 20 years.
It has led some auctioneers to hold certain sales outside Germany.
No German auctioneers hold weekly sales, and even monthly sales are rare. Hosting just six to eight sales a year, including specialist thematic actions, is quite common. Some houses only hold two – albeit monumental – auctions a year, in spring and autumn. Almost all auctions are accompanied by a fully illustrated catalogue, often encompassing several volumes. Extra information with further detailed illustrations is often available online.
Viewing is generally held for at least three days before a sale, sometimes for up to a week. While most catalogues these days can be viewed online, not all auctioneers have facilities for live online bidding.
After registration, potential bidders are given a numbered ‘paddle’ or bieternummer, which is held demonstratively aloft to bid. Scratching noses, waving a pencil or other discreet signs are not generally acknowledged as legitimate forms of bidding. Most auctioneers start the bidding at the reserve or at the price defined by the level of commission bidding.
7 Unter Vorbehalt
If an item fails to meet the reserve the auctioneer can, at his discretion, accept lower bids and there is a provisional knock down (unter Vorbehalt). The bidder is bound to his bid for four weeks, during which time the auctioneer asks the consignor if he will accept less than the reserve. After some negotiation, a satisfactory arrangement is often found.
8 Buyer’s premium
Charging the buyer has been standard practice at German auctions for well over a century. In 1909, for instance, a Berlin auctioneer charged buyers a premium of 5%. In the 1970s the standard rate was 16%. In recent years this has risen considerably – it now ranges between 20 and 33%. Several houses charge a higher premium for online bidders.
Two forms of taxation apply to auction purchases, depending on the status of the consignor. Under the margin scheme the standard rate of VAT (currently 19%) is charged only on the buyer’s premium; under the standard or regular scheme both the hammer price and the buyer’s premium is subject to VAT. If applicable, a droit de suite surcharge will be applied in both cases.
10 Post sale – Nachverkauf
Many auctioneers give potential buyers up to four weeks to purchase unsold lots after the sale. They are generally available for the reserve price plus buyer’s commission. This practice is not universal; some auctioneers do not hold a Nachverkauf. Unsold items are either held over for a future sale or returned to the consignors.