Will the Art Market Ever Regulate Itself?

Regulation in the world of art commerce is a troublesome word. It whips up Wittgensteinian conundrums, takes and double takes on meaning and context the likes of which are only seen in 1960s romantic comedies. Yet, despite this, calls for more regulation rise every so often, phoenix-like from the ashes of previous entreaties, and every time they are burned in the fires of outrage and stubborn tradition. With reactions ranging from the wide-eyed innocence of “but we already regulate ourselves” to the defensive “what are you implying about my sources?” calls for regulation have never gained ground.

And so it is that Elliot Lee, a UK arts and antiques dealer, treads lightly in his newest attempt to lay down some law in a market that has, on many occasions, been likened to the Wild West. Owner, manager, and “perhaps editor in chief” of Antiques and Luxury Design blog, Lee is rocking a few boats by introducing what he calls a “Straight Deal Charter” (SDC) which would, should it ever be worked through and signed onto by industry professionals, introduce a uniform code of ethics for dealers to abide by and for customers to count on.

“I still believe in a hand shake deal,” says Lee, “However, in the sprawling landscape of the World Wide Web, with no barrier to entry into this marketplace, we all need to go one step further than ever before in providing as much security in our dealing as possible.”

When I say, he’s “rocking a few boats” with his recent “invitation to dialogue” post on the AAD blog, I mean he’s rocking them in a quiet, polite kind of way, asking colleagues to comment on an evolving draft of the charter.

In fact, following the string of comments on the post, one is startled by the uniform civility of all commenters. It is matched only by equally uniform foot-dragging. “Do pardon,” the entire string seems to whisper, “but I daresay I would love for you to drop it.”

The reasons why are myriad. The nascent SDC is, thus far, full of proposals which cause Lee’s peers to squirm. One of them, in particular is meeting with a lot of resistance:

“Legal entitlement to goods valued at over £5000 ($8000.00) will be backed by a certificate from the Art Loss Register or Stolen Art Belgium (organizations which list reported stolen items of value).”

Nothing crazy about that, right? After all, the frequency of art theft has increased and many perceive this to be a growing problem. One report on NPR suggests that “art crime is now the third-highest grossing criminal enterprise worldwide.” And since most stolen art gets passed around the black market, before it’s laundered back through the legitimate market, and then sold for it’s real value, the ethical response should indeed be for dealers, especially of secondary market works such as Old Masters and antiques, to check the Art Loss Register before purchasing, or at least before selling, a piece.

But art consultant Margie FitzSimons, adding her voice to the comments of the SDC post, thinks that such a regulation would be too costly:

“The whole cert requirement is expensive, as many others have said. To have a search done, the Art Loss Registry charges $95/search or $800/year or 25 searches, whichever comes first, according to their website.”

In fact many of Lee’s peers agree that they don’t want to deal with the cost of checking relevant items. No one even deigns to talk about outreach to the FBI and to Art Loss to investigate the possibilities of cooperation and discounts for costs incurred.

And there’s the clincher: Lee’s efforts may be dead in the water if he can’t nudge his fellow dealers into a pro-active state of mind. Not only does the expense of checking to make sure their inventory is legit seem insurmountable to Lee’s group, but they are also easily put off by small issues such as drawing up exemptions to rules (too many!) and adding sold items to a register (client confidentiality forbids!) and keeping abreast of industry news and trends (who’d going to keep track?). There’s a lot of “we do that already” and scattered “this can’t be enforced.”

The ultimate charter killer, though, seems to be civility. Yes, you’re reading that right: civility. Most of the dealers on the AAD site are honest and so are their sources. They take a lot of time reminding each other of that and are loathe to appear to question, even in a general way, the ethics of anyone in the field.

“I would expect that the vast majority would already adhere to the majority of these principles and those that don’t wouldn’t want to be part of it anyway,” comments Anthony Smith, a dealer of contemporary paintings and sculpture from China, South East Asia and Australia.

“Mutual trust and a handshake will remain my preferred way and after some 30 years playing about in the trade I am unlikely to change now … ,” muses Tom Higgenson in the comment thread.

“The sources for the art on our website are people that I know personally, and I deal with them not only because I trust them; they have good reputations for honest dealing … It would be insulting to ask them if the art they would like to sell through our website could have been stolen,” explains Margie FitzSimons.

And there is the reality of the situation, as no sane antiques dealer will ever say, ‘Yes, please! I’d love to pay for more research, assiduously document my sales online, prove that I’m studying and doing my homework, and second-guess all of my trusted sources.’

But what about that increase in art thefts (some say as high as 43%) and the resultant hot art that shows up at auction? And what about the increase in discoveries of stolen art due to the Art Loss Register and the FBI’s National Stolen Art File? What about the looted art that gets laundered and passed along for decades even while it’s disputed?

New York antiques dealer and consultant, Sarah Ann Filler has been working with Lee on the charter. Asked her if she forsees any pitfalls to moving forward too quickly without garnering widespread support and her answer was, as expected, measured. But what is striking and encouraging is her desire to move forward and work out the kinks:

“The art and antique industry overall is obviously complex and multi-layered, with a wide range of sometimes opposing needs expressed by the various segments. It can be a true challenge to look beyond the present and into the future needs of the material we are charged with. Finding this balance here is just one aspect of what many in the industry are now weighing, and including all segments in this discussion is very important in ensuring the most well-considered outcome. We’re both very keen on sustainability.”