Buying and selling artworks
With most purchases you know exactly what you are buying. With art you do not. Value is subjective and the market has its own customs. Where you stand depends on the law, on your contract and on what is usual in the art trade. That last part is written down nowhere.
This page sets out Dutch law and Dutch market practice. It applies when the seller, the buyer or the work is in the Netherlands, and often to cross-border deals involving a Dutch party.
The purchase agreement and the warranty on attribution
A buyer, a seller, a price, an object to be delivered. In that sense buying an artwork is no different from any other purchase. The content does differ, and most sharply on authenticity.
In many transactions the attribution to a particular artist is an essential part of the deal. Does the seller warrant that the work is by that artist, or does the description say attributed to or studio of? That difference can be worth hundreds of thousands of euros. The agreement should say what the seller does and does not warrant, and what happens if the attribution is challenged later.
Then the chain of ownership. Is the seller actually entitled to sell? It sounds obvious, and in the art trade it is not. Works sit on consignment, hang out on loan, or are the subject of an ownership dispute. You want to know you are dealing with someone who can dispose of the work.
Across borders, applicable law is added. A sale between professional parties from different countries may fall under the Vienna Sales Convention, which has its own rules on conformity, notice periods and damages. Parties can exclude it, but only explicitly.
Authenticity and due diligence in the art trade
Disputes about authenticity are as old as the art trade itself. Some experts estimate that up to twenty per cent of the works on the market are not authentic. Which leaves the question of who has to find out what.
The seller has a duty to disclose. Doubts about authenticity that are known to the seller belong on the table. Against that sits the buyer’s duty to investigate. In the professional trade you do your own due diligence. Consulting experts, tracing the ownership history, asking for documentation. The more professional the buyer, the more is expected of that buyer.
Consumer sales work differently. A private individual buying from a professional seller falls under consumer law, and the burden of proof then weighs more heavily on the seller.
If a work turns out not to be authentic, several routes are open. Non-conformity, where the work is not what the buyer was entitled to expect. Mistake (dwaling), where the buyer would not have bought it, or not at that price, had the facts been clear. Fraud weighs heavier, because there the seller knowingly gave false information. Which route stands the best chance depends on the facts and on what was agreed at the time.
Provenance, restitution and illegal export
The ownership history of a work is part of what you are buying. For works that changed hands shortly before or during the Second World War in particular, provenance can be a legal minefield.
Where a wartime origin is possible, the Restitutions Committee (Restitutiecommissie) comes into play. This independent committee assesses requests for the return of artworks lost involuntarily as a result of the Nazi regime. Its finding is an advice and therefore not binding, though it is almost always followed. If you buy work of European origin from the period 1933 to 1945, provenance research is not a formality.
Outside that context a defective provenance can catch up with you too. The Dutch Heritage Act (Erfgoedwet) regulates the export of cultural goods of special significance, and international treaties such as the 1970 UNESCO Convention set requirements for importing cultural goods from other countries. Acquire a work that later turns out to have been exported illegally and you may find a claim for its return on your desk.
Resale right on resales above €3,000
On the resale of an original artwork involving a professional art dealer, the resale right applies once the sale price exceeds €3,000. The seller is ultimately liable, although the buyer and any intermediary can be approached as well. The rate is 4 per cent on the first €50,000 of the sale price, with lower percentages for higher amounts, up to a maximum of €12,500.
Artists collect it themselves, or leave it to Pictoright, which manages the rights of around 2,500 Dutch and 80,000 foreign artists. The professional trade has to supply everything needed for that collection: the sale price, the date of sale and the parties involved.
More about the artist’s resale right →
More about provenance research and restitution →
Get in touch with Jaap Versteeg
Are you about to buy or sell an artwork and would you like your position reviewed? Or is there a dispute about authenticity, ownership or conformity? Get in touch with Jaap Versteeg. Call 020 675 88 21 or email him for an initial consultation.
