Auction Houses Hire Lobbyists to Defeat Resale Royalties Bill

  • March 24, 2014 23:41

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Capitol Hill

Major auction houses and internet auctioneers are taking no chances that the American Royalties Too Act, which would pay royalties to visual artists (or their estates) from resale profits at public auctions, will pass in Congress.

Sotheby's brought a team of lawyers and lobbyists to Capitol Hill this month to oppose a new bill proposed by Representative Jerrold Nadler, a Democrat from New York. Rival auctioneer Christie's has hired David Israelite, president of the National Music Publishers' Assocation, for his experience fighting royalty battles.

Nadler had introduced a bill in 2011 with the same intentions to give some profits from resales of artwork back to the creators. Many countries have adopted such practices, called droit de suite in French. California was on track to initiate resale royalties to artists until a state court ruled it unconstitutional in 2012.

A new version of the bill now includes smaller auction houses, those with a minimum of $1 million in sales as opposed to $25 million, and internet sales. Galleries and dealers are not included in the legislation. Artists, or their estates, would receive 5% of the profit from auction sales, and the cap would be $35,000 for any one resale.

Nadler says his bill represents "fundamental fairness" to artists as their work might appreciate greatly on the resale market. Auction houses contend that the bill will force more sales into private transactions, and that the top end of the art market will be mostly affected. Internet trade groups and Ebay also oppose the bill saying it will restrict free trade and lower prices.

Any hearings on the bill will be instigated by Representative Robert W. Goodlatte, a Republican from Viirginia and chairman of the Judiciary Committee. He is expected to overhaul copyright laws throughout the year.

 


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