Finns close to deal on art royalties

Date: 21/10/1999

By Renée Cordes

FINLAND is optimistic about the chances of securing agreement next week on controversial EU-wide rules which would force galleries and auction houses to pay royalties to artists, despite fierce opposition from the UK.

Helsinki believes it has made enough minor changes to the proposal to win over countries such as Luxembourg, Ireland and the Netherlands, which had previously voiced reservations about the plan, and outvote the UK when internal market ministers meet next Thursday (28 October).

However, diplomats have warned that this could spark a political backlash in the UK, which has been opposed to the proposal from the start, and that this might deter some member states from supporting the plan.

The Finnish presidency believes there is little chance of satisfying the British government, and is determined to put the issue to a vote. “One could say that it is never going to be enough for the UK no matter what changes we make,” said one Finnish diplomat.

The proposal seeks to put competing art centres within the Union on an equal footing and create a single art market. There are only four countries in the EU which do not currently require royalty payments to artists when their works are resold.

Under the latest Finnish proposals, the measure would be implemented five years after it has been formally adopted, one year later than originally planned. The royalty payments required for works of art worth more than €500,000 would also be trimmed, with varying amounts for other works depending on their value. No royalties would be paid on art works worth more than €1 billion - a move aimed at easing the pain for art centres worried about losing business as a result of the measure.

The UK fears that the proposed legislation would drive business away from London's prestigious auction houses to rivals in New York, Geneva and Hong Kong. It claims that up to 5,000 jobs in the British art business could be lost and says the Union as a whole would lose out as the art trade shifted to royalty-free markets. But Bild-Kunst, the German art collection agency which has been lobbying for harmonised sales royalty payments, argues that utilising this system at Union-wide level would benefit artists and their heirs as well as charitable art-subsidising foundations.

At their last meeting in June, internal market ministers agreed to delay a decision so that work could continue on finding a solution acceptable to the UK. German backing for the British stance, promised in return for the UK's support in delaying agreement on a controversial car-parts recycling measure, was crucial. But London will not be able to rely on German support this time, with Berlin officials saying that the new proposal would be examined on its merits.