Whose Rights? Anish Kapoor’s “Dirty Corner” Exposes A Battle Between Artists’ Moral Rights and The Rights of the Public

By Adrienne Couraud*

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Anish Kapoor’s Dirty Corner, before and after vandalism.

In 2008, President of the L’Établissement public du château, du musée, et du domaine  national de Versailles, Jean-Jacques Aillagon debuted a series of solo art shows and temporary art installations at the house and gardens of the Chateau de Versailles. Beginning with the summer solo retrospective of American artist Jeff Koons, the program has grown both substantively, including past artists such as Takashi Murakami (Summer 2010), Joana Vasconcelos (Summer 2012), and currently, Olafur Eliasson (Summer 2016), as well as procedurally, expanding from a seasonal to a year long program. In 2015, the contemporary art program of Versailles offered artist Anish Kapoor a solo show to integrate his sculptures within the spatial challenges the house and Versailles gardens present. As President of the Palace of Versailles Catherine Pégard states, “[Versailles] is not a museum or a gallery or an exhibition space.”

In his own words, Indian-born but British-raised artist Anish Kapoor describes his raw-material born sculptures as “talking” about himself. Kapoor’s sculptures emulate a “void” straddling the duality of  “something, even though it is really nothing.” Kapoor originally described his 2015 “Dirty Corner” installation destined for Versailles , a steel-and-rock sculpture over sixty meters long and ten meters high, as “the vagina of the queen who is taking power,” but later retracted his statements to focus on his message: “to create a dialogue between these great gardens and the sculptures”.

After the sculpture was installed it was subject to repeated vandalism attacks and Kapoor declined to remove it “to bear witness to hatred”. Following the complaint about the Kapoor’s “Corner” launched by a right-winged politician and Councilor of Versailles Fabien Bouglé, an administrative French court ordered the covering of anti-Semitic graffiti on artist Anish Kapoor’s installation, Dirty Corner, at the Palace of Versailles [“Versailles”] in September 2015. Mr. Bouglé filed a complaint with a French public prosecutor against Mr. Kapoor and Catherine Pégard, President of Versailles, for “inciting racial hatred, public insults, and complicity in these crimes,” after Kapoor decided to leave the vandalism as a public testament, “belonging to anti-Semitism that we’d rather forget.”

The Dirty Corner Court Case

Prior to the court decision, Versailles announced plans to alter Kapoor’s installation by covering the vandalism with a shiny gold foil against the faded brass structure, leaving the defacement as an obvious disruption of the work – a process that was expedited following the court decision. Despite artist’s meeting with French President François Hollande, who declared the defacements “hateful and anti-Semitic,” Kapoor explained to the French newspaper Le Figaro, “I had already questioned the wisdom of cleaning [the installation] after the first vandalism.” The French Minister of Culture, Fleur Pellerin, stated she respects Kapoor’s decision but found the public debates thus spurred “extremely interesting and raise the question of creative freedom.”

The Tribunal Administratif de Versailles released a statement about the decision deeming the vandalism a “serious and clearly illegal breach of fundamental liberty.” Though the court acknowledged the moral rights of artists, “this freedom has to be reconciled with respect for other fundamental liberties,” alluding to the requisite for public peace. The public nature of Kapoor’s installation required that the court ensure protection to “everyone from attacks on their human dignity.”

Kapoor reacted to the court’s decision in a phone interview from Moscow at the opening of his exhibition at the Jewish Museum and Tolerance Center, declaring the court’s decision a “perverse reversal” of his accord. “Without proper public debate and proper public exposure for culture,” Kapoor proclaimed, “we are in a fascist state.” Kapoor’s installation was vandalized once prior to the court decision and, thereafter, three additional times, to which Kapoor maintained, “I don’t want to see it on the work; I find it vile.” In his steadfast battle against racial hatred, however, Kapor has “refused to remove it and pretend it didn’t happen,” raising important questions concerning the boundaries of  aesthetic taste and artistic value.

What Are Moral Rights?

“Droit moral”, or moral rights, stem from the Kantian and Hegelian concept of transferring an artist’s personality into a work and refers to the right of an artist to control his work. Moral rights protect the personal value, rather than the monetary value, of a work. Under American Law, inalienable moral rights are have more limited jurisdictional protections than in other jurisdictions, as they are protected under judicial interpretation of copyright and trademark law, coupled with 17 U.S.C. §106A, or the Visual Artists Rights Act of 1990 (VARA), which protect moral rights for the life of the artist.

Prior to VARA, U.S. legislative history reveals the American endeavor to define moral rights as “derivative works”, or artistic works based on the work of another artist, demonstrated within the Copyright Act and the Lanham Act, which defines trademarks and unfair competition. After VARA was passed, in the United States moral rights automatically vest within an artist but are limited to a “work of visual art,” granting two particular rights: the right of attribution and the right of integrity. The right of attribution allows an artist to associate or disassociate his name from his work of visual art. The right of integrity prevents both the intentional modification of his work of visual art if the modification is likely to harm the artist’s reputation and the destruction of any work of visual art protected by a recognized stature.

Under European Law, however, copyright law typically protects inalienable moral rights perpetually. Under French law particularly, copyright law protects four moral rights: the droit de divulgation; or the right of disclosure, the droit de repentir ou de retrait, or the right to affirm or disaffirm works previously publicized works; the droit de paternite, or the right of attribution; and the droit au respect de l’oeuvre, or the right of integrity. French courts have refined the right of integrity to allow owners of physical works the right of reasonable use and the right of reasonable adaptation without gross distortion.  For example, French moral rights do not expire, regardless of the number of created copies of a work, while American moral rights more rigidly limit works based on the number of copies created.

The Dirty Corner’s Effect on Moral Rights

The French court decision affecting Kapoor’s Dirty Corner appears to place two additional refinements on moral rights in France because of the work’s public location. First, the public installation of Kapoor’s work subjected it to a public order. Second, the public installation of Kapoor’s work subjected the public to “protections of human dignity.” Though the court recognized Kapoor’s moral rights, the moral rights could not outweigh “other fundamental liberties” of the public, alluding to the requisite for public peace over artistic scandal.

“It’s a terrible, sad thing,” Kapoor announced in his reaction to the court decision. “France is weird, I don’t understand it,” Kapoor added. “It doesn’t take in the full context. We’re going to take the case to appeal and we’ll see what happens.” Kapoor continued, “[w]e have to experiment in public, it’s our role as artists, that’s how society grows. If we stop that, we might as well live in a fascist state.” For now, however, Kapoor will have to channel his determination to test the creative and cultural limits of France outside of the Palace of Versailles.

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*About the Author: Adrienne Couraud (J.D. Candidate 2017) is a student at Brooklyn Law School. She may be reached at adrienne.couraud@brooklaw.edu.

Disclaimer: This article is intended as general information, not legal advice, and is no substitute for seeking representation.

ISIS Cultural Destruction: In Brief

By Mia Tomijima*

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War and political takeovers define history, but are also often responsible for erasing it. The devastating effects of these feuds result in the destruction of cities, people, and culture. Political leaders often make it a goal of destroying cultural heritage as a way of rewriting history and imparting their political, religious or ideological beliefs upon the civilization they are taking over. As the Nazis did during World War II, ISIS has emerged as the most recent group to destroy cultural heritage to further its ideology.

ISIS (or ISIL), shorthand for the Islamic State of Iraq and Syria, is a group of militants that have taken over parts of Iraq and Greater Syria (Syria, Lebanon, Turkey, and Jordan) and claim to represent Muslims worldwide. ISIS emerged during the summer of 2014, and quickly drew media attention with video recorded beheadings of journalists, and other reported massacres.394410_img650x420_img650x420_crop

Alarming reports from the archaeological community show that ISIS militants are now attempting to impose their ideology by demolishing cultural sites in Northern Iraq, including the Mosul Museum, the ancient city of Hatra, and other Assyrian capitals. The systematic public destruction of cultural property politically motivated to attract media attention is also considered to be a war crime under the 1954 Hague Convention for the Protection of Cultural Property in the Event of Armed Conflict. In addition to the senseless destruction, ISIS is also selling Assyrian antiquities on the black market, using the proceeds to fund their campaign. Center for Art Law recently wrote on one such report of an Assyrian statue head emerging in the U.S., and the U.S. Attorney’s Office’s response to bring civil forfeiture proceedings on behalf of war-torn countries.

ISIS affiliation is even claiming responsibility over a recent attack in Texas, involving a shooting that occurred outside a cartoon contest of Prophet Mohammed in Texas (however no formal proof of affiliation of the shooters has yet to be shown). There has been great discussion in the archaeological, legal, and political communities over the destruction of cultural property in Iraq and Syria, including this Yale News conversation with Assyriology Professor Eckart Frahm, and this Democracy Now interview of Columbia University’s Near Eastern and East Mediterranean art and archaeology Professor Zainab Bahrani, who has consulted UNESCO on such matters.

On February 12, 2015, UN Security Council adopted Resolution 2199 to try to curb traffic in looted Syrian and Iraqi artifacts sold by ISIS members. In response to this call for action, French President François Hollande and members of the United States Congress recently issued statements in support of protecting cultural patrimony from the ISIS occupied territories. On April 26, 2015, the US House Committee on Foreign Affairs proposed a bill, H.R. 1493 Protect and Preserve International Cultural Property Act, which would, among other things, “require the Department of State to designate a department official to coordinate the efforts of the federal government to protect international cultural property… and develop strategies to reduce the illegal trade in such property and to assist countries in protecting their heritage sites and preventing looting and theft of cultural property.”

At an emergency meeting in July 2014, UNESCO’s Director General Irina Bokova stated “humanitarian and security concerns are inseparable from culture. Protecting the lives of people, their cultural heritage and identity go hand in hand,” and pledged that “UNESCO will continue mobilizing the United Nations Organization and the whole international community to safeguard Iraq’s cultural heritage with particular emphasis on the fight against illicit trafficking in cultural property.”

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*About the Author: Mia Tomijima is a recent graduate of Brooklyn Law School, where she received a certificate in intellectual property and served as Chair of the Art Law Association. She received a bachelor’s degree in art history from UCLA, and has worked with museums, auction houses, and law firms on both coasts. Mia is a post-graduate fellow with Center for Art Law. 

Attacks Against Cultural Heritage Abroad Raise Questions at Home

by Melissa (YoungJae) Koo*

Just about a month after the attack at Charlie Hebdo journal and a deadly shooting at a kosher supermarket in Paris, five teenagers are detained in France for desecrating as many as 250 gravestones in a cemetery in a rural town in eastern France, where many Jews are buried. This incident again calls to mind concerns about violations against art and cultural property and the increasing anti-Semitism in France and elsewhere. According to Professor Richard Weisberg, the Walter Floersheimer Professor of Constitutional Law at the Benjamin N. Cardozo School of Law and a White House appointee to the Commission on the Preservation of America’s Heritage Abroad, the recent troubling desecration event in France has been on the Commission’s radar. It is one of many desecrations of Jewish sites in Europe that have historically happened in Central and Eastern Europe. Although it is not clear whether the motivation of the grave desecration was based on anti-Semitism, the commission has assumed that anti-Semitic sentiment was a major driving force in the actions, Professor Weisberg stated.

Weisberg indicated that the act of vandalism is punishable by criminal law; however, he added that although France as well as the rest of Europe needs to further educate younger generations, there is always a possibility of anti-Semitic incidents happening time to time. To counter other future similar acts, the Commission on the Preservation of America’s Heritage Abroad has been supporting maintenance of sites like graveyards even if there is no desecration, if the sites are important to American constituents. The Commission also has been working with European governments and private groups, both Jewish and non-Jewish, to educate people to prevent desecration.

In addition, Weisberg’s recent article “Even in the wake of Charlie Hebdo, France’s Jews are living in peace” in the New York Daily News points out the overreaction of media, especially in the U.S., toward anti-Semitism in Europe. Weisberg mentioned that despite sometimes being criticized, French government officials “stand[] in solidarity with [their] Jewish population.” The French government has expressed vocal and politically courageous statements in support of the Jewish community as well as abhorrence toward such anti-Semitic incidents, both on national and local level. Indeed, the French Prime Minister Manuel Valls went on record to address his citizens after the January attacks in Paris to underscore that “[a] Jew who leaves France is a piece of France that is gone” to discourage an exodus. The French government’s support of the Jewish community and outcry over destruction of cultural patrimony respond to ongoing issues with extreme right winged, old forms of anti-Semitism in France. In a similar fervent fashion, the French President François Holland has criticized recent ISIS attacks against cultural institutions such as the Tunis museum, attacked by gunmen on March 18 that left 23 people dead, among them 19 tourists from different nations.

Hate crimes that resulted in desecration of a burial place in France also run parallel to the recent extremists’ attacks on cultural sites in Iraq, Syria, Tunisia and elsewhere. As the world leaders denounce such acts, attacks against museums, cemeteries, and cultural properties that affect culture heritage and people in the community, sadly, continue.

*** The author wants to express special thanks to Professor Richard Weisberg for his time and kindness during the interview.

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About the Author: Melissa (YoungJae) Koo, Legal Intern with Center for Art Law, is a third year student at Benjamin N. Cardozo School of Law, concentrating in Intellectual Property law, especially art and fashion law. She can be reached at youngjae.koo@law.cardozo.yu.edu.

 

 

Je Suis Public Domain

by Dennis C. Abrams*JeSuisCharlieTM2

On January 7th in Paris, an Islamist terror attack at the headquarters of the satirical magazine Charlie  Hebdo resulted in the deaths of twelve people. It was immediately apparent that the attacks were carried out in retaliation for the magazine’s cartoons depicting the Prophet Muhammad. Shortly after the shooting, Joachim Roncin, a Parisian who works for the French magazine Stylist, posted a defiant message on Twitter with the text “Je Suis Charlie” (which translates to “I Am Charlie”). Although Roncin’s Twitter account had only 400 or so followers at the time, “Je Suis Charlie” quickly became a global rallying cry for freedom of expression and solidarity against terrorism. The phrase, which according to Roncin, means “I am free, I am not afraid,” went on to become one of the most popular news-related hashtags ever on Twitter.

Since Roncin originally coined the phrase, there have been attempts by several parties, including Roncin himself, to establish and protect rights to “Je Suis Charlie.” A day after the attack, Yanick Uytterhaegen, a Belgian man, filed an application with the Benelux Office for Intellectual Property to use the phrase in Belgium, Luxembourg and the Netherlands in association with a variety of goods including things such as sporting goods, stationery, cleaning supplies and footwear. France’s National Industrial Property Institute received at least fifty applications to register the phrase as a trademark but announced less than a week after the attack that none of the applications would be granted. At least two trademark applications were also filed in the United States and one in Australia in the days that followed. Both the Australian and Belgian applications have since been withdrawn while the American applications are pending review.

There are several reasons why applicants are ill-advised to attempt to have “Je Suis Charlie” and similar slogans registered as trademarks and why offices which rule on these applications are unlikely to grant them. As Roberto Ledesma, a former Trademark Examiner at the United States Patent and Trademark Office (USPTO), explained on his blog, EverythingTrademark.com, in addition to subjecting themselves to public scrutiny and criticism, applicants will likely find their applications rejected and their time and money wasted.

Applications for trademark rights in slogans associated with tragedies and social causes has become something of a trend recently. For example, attempts were made to register “Boston Strong” after the Boston Marathon bombings, “Hands Up, Don’t Shoot” in relation to the unrest in Ferguson, Missouri, “I Can’t Breathe” following the death of Eric Garner at the hands of the New York Police Department and “Ice Bucket Challenge” at the height of the viral video fad which promoted awareness of Lou Gehrig’s disease. Such applications are often viewed unfavorably as attempts to commodify and capitalize on tragedies. Illinois woman Catherine Crump has been called “shameless” for attempting to trademark “I Can’t Breathe” and Jezebel writer Jia Tolentino added a taunt, “[s]ee you in hell, Crump!” The ALS Association also withdrew its application for “Ice Bucket Challenge” amid controversy.

Trademark applicants for “Je Suis Charlie” are especially likely to face scrutiny because trademarking the phrase would have the counterintuitive effect of restricting the use of a slogan which, in the aftermath of the attack on a periodical, has become emblematic of the rights to freedom of expression and freedom of the press. According to The Independent, Yanick Uytterhaegen was predictably the target of a vilifying Twitter campaign (here are just a few examples of reactions on social media) before withdrawing his application for “Je Suis Charlie.”

A sampling of “Je Suis Charlie” merchandise available online compiled by RTL Nieuws.

Even if public backlash, whether justified or not, is insufficient to deter prospective applicants, registration is not likely to be granted either in the United States or elsewhere. As Ledesma reminds us, trademarks exist to serve as source identifiers for goods and services. Slogans such as “Je Suis Charlie” are so ubiquitous and noncommercial that consumers will not associate them with a particular source of goods but with the cause, issue or event to which they refer. Applications to register “Boston Strong,” “Hands Up, Don’t Shoot,” and “Occupy Wall Street” were all rejected by the USPTO on these grounds.

Registering “Je Suis Charlie” would face an additional roadblock because “Charlie” is a reference to Charlie Hebdo. Lanham Act § 2(a) bars from registration a trademark which falsely suggests a connection between a trademark and other persons, institutes, entities, ideas and so on. Ledesma’s article cites the applications for “Justice 4 Trayvon,” “MH17,” and “Linsanity” which were rejected by the USPTO on the grounds that they suggested connections to the estate of Trayvon Martin, Malaysia Airlines and Jeremy Lin respectively. Once the USPTO inevitably rejects an application for such a trademark, the applicant will have spent a minimum of $225, assuming the cheapest application option and no legal assistance.

Capitalizing on “Je Suis Charlie” and similar slogans may also be unfeasible in Europe. Belgian attorney Paul Maeyaert suggests that applications for such slogans can be rejected on moral grounds for their “free riding on a catastrophic happening.” More specific to the rallying cry at issue, attempting to monopolize “use of a slogan incorporating one of the main rights of the Convention for the Protection of Human Rights and Fundamental Freedom (i.e. freedom of speech)” could be grounds for the rejection of an application of “Je Suis Charlie.” Other European attorneys point out that a European trademark office could refuse registration “on the grounds of being disparaging or offensive” or “contrary to public policy or accepted principles of morality” due to their intent to capitalize on a tragic event. Outcomes would ultimately be determined by whether the trademark office in question considered the mark “below the accepted principles of morality” in their jurisdiction. As such, registration determinations could vary between jurisdictions. An ill-fated application in Europe may also cost registrants even more than in the U.S.; Yanick Uytterhaegen, for example, would have been required to pay a minimum of roughly $270 in the Benelux.

Fortunately, the social consequences of applying for trademark rights in transcendent, topical rallying cries would be discouraging enough for most people. But there will always be those who feel that the potential for profit makes such applications worthwhile. These profiteers should closely monitor the fate of the two American applications to trademark “Je Suis Charlie.” When these pending applications are inevitably rejected or withdrawn, they will join the ranks of the many similar applications which met the same fate and prospective exploitative registrants will be forced to reconsider their position.

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About the author: Dennis C. Abrams, Legal Intern with Center for Art Law, is a 3rd year student at Benjamin N. Cardozo School of Law, with an interest in intellectual property, media, art, entertainment, and sports law. He can be reached by e-mail.

The European VAT: Good for Tax Revenue, Bad for the Commercial Art Market?

by Elizabeth R. Lash, Esq.

As an American, one might be forgiven for assuming that Europe, with its traditional support for the arts (at least, as a cultural phenomenon), would be equally supportive in its tax regime for the same. While in some limited instances, the European Union continues to provide a more favorable regime for the independent artist, the trend towards an ultimately higher value-added tax (“VAT”) on the sale, import and export of artwork, particularly with respect to art sold by galleries and in the resale market, may discourage the growth of an EU-wide commercial art market in comparison with more favorable tax regimes outside the EU.

VAT was initially intended to be used as a single tax rate applicable to all goods and services across all European Union member states. While the standard rate was originally set at 15% in 2006, member states could theoretically request reduced rates in one or two categories, set at no less than 5%. In reality, as each member state negotiated the terms of its entry into the EU, the list of categories has expanded to at least 21, with rates above and below the standard rates (which already varies from 17% to 27%), along with multiple categories of rates below 5% (zero rates, “parking rates” (i.e., rates negotiated with entry into the EU), and super reduced rates). As well, categories of rates are inconsistently drawn, from too narrow to overly broad: it includes, among others, such categories as printed books, e-books, cultural institutions, household cleaning, sporting facility use, bicycles, and writers and composers.

When it comes to artwork, VAT rates vary widely, ranging from 5% (Malta) to 25% (Sweden) (although there is a reduced rate for independent artists’ sales). In addition, VAT may be calculated on the margin (i.e., the difference between the original sale price and the purchase price), instead of under the standard or reduced rate (whichever is applicable to artwork in that particular member state). In a number of member states, the VAT may be set at multiple rates: one for independent artists; another for galleries and dealers; and still another for the import or export of art.

Further complicating this picture, the EU Commission may not only pressure (or even sue) a member state as to the categories for which reduced rates are permitted, but may also regulate individual tax cases affecting artists and collectors. One example in particular is the Flavin case, whose outcome confounded the international art community (and sets an unfavorable precedent in future, similar circumstances). In 2006, a British gallery (named the “Haunch of Venison”) imported two well-known American conceptual artists’ sculptures: Dan Flavin’s light sculpture, and Bill Viola’s video installations. The former consisted of several tubes of fluorescent lights, while the latter consisted of several audio-visual productions playing on various projection screens. The British customs office imposed a 20% rate instead of the reduced 5% rate for artwork. However, upon appeal to the British VAT and Duties Tribunal (the “Tribunal”), the reduced rate was re-instituted in 2008.

But despite this local regulator’s final decision (with no further appeal by the parties to the EU courts), the EU Commission weighed in anyway with its own regulation, issued in September 2010, which specifically overturned the Tribunal’s decision, ostensibly to effectuate the uniform taxation rules on imported goods. The EU Commission found that it was not the installations themselves which constituted artwork, but the results of such installations, whether of the “light effect” of Dan Flavin’s light sculpture, or the videos screened on Bill Viola’s video installations. Thus, in effect, the EU Commission found that the installations should have been taxed just as if a hardware or electronics store had imported lightbulbs and video components. For conceptual artists, this represented a major blow to the sale in and import of their artwork into Europe.

Then take Germany. Germany formerly assessed a reduced VAT of 7% on sales of art (other than photography). However, due to pressure from the EU Commission, which had opened proceedings against Germany regarding this reduced rate category, Germany passed legislation to raise the rate to 19%, effective January 1, 2014 (Germany’s standard VAT rate since 2007). In response, German federal legislators passed a national directive that permitted the tax to be assessed on only 30% of the purchase price, relying in part on an exception to the VAT directive that had been used in France for several years. But the application of this directive was restricted less than a year later by the German states to artwork priced under 500 Euros, and a few other categories, essentially undercutting the law’s essential purpose—to provide a more favorable rate for the commercial art market. Meanwhile, artists selling out of their studios remain subject to the 7% rate. While this may be acceptable for those select artists who sell out of their own studios, it does not bode well for those who are represented by galleries.

In 2014, in another instance of muddying the tax waters, the French government increased VAT on the sale of art in France from 7% to 10%, while still permitting imports of non-EU artwork to be taxed at 5.5%. Only a year later, the French legislators acknowledged this inconsistency, and reduced the VAT on direct sales by French artists to 5.5%, effective January 1, 2015. Meanwhile, in Spain, the current VAT on artwork was raised from 8% to 21% in September 2012, initially as part of the general rate assessed on goods and services related to “culture.” Within a year, after much hue and outcry, Spain decreased the rate again to 10%. Meanwhile, in Italy, the VAT on the sale and import of artwork is still 22%.

The dust may eventually settle on the various VAT rates and their application, but the newest wrinkle is a regulation (Council Implementing Regulation (EU) No 1042/2013) which changes how VAT is assessed—from the place of supply to the place of purchase. While this does not affect traditional visual artists and sculptors, it does impact those who are considered to supply services or goods digitally to consumers—for instance, freelance website designers. The regulation, effective January 1, 2015, requires such businesses to assess VAT based on the country of the purchaser, rather than the VAT of their own country, placing yet another burden on artists in figuring out the application of VAT—even though the regulation was meant, in part, to apply to the likes of e-retailers such as Amazon.com.

In light of the fluctuations in tax rates and their applications, with the ultimate trend inching towards a uniformly high VAT rate, the art market looks nowhere near as enticing in the EU as it does in those countries and locales not subject to the vagaries of the VAT rate debate. In the U.S., for instance, no VAT exists (although, of course, the U.S. does have a sales tax), and there is no import duty assessed on original works of art. Hong Kong does even better—it has no sales tax, import tax, or export tax on artwork. To some degree, the numbers back this up: according to an annual study conducted by Arts Economics for the European Fine Art Foundation, in 2013, the U.S. accounted for 38% of the global market by value, while the EU as a whole dropped 3% points to 32%. (The UK ranked separately at 20%–perhaps not a surprise in light of its 5% reduced VAT rate on artwork, the Flavin case notwithstanding.) Moreover, in the EU itself, the numbers for those member states with the highest VATs declined or remained the same. And while Hong Kong and Singapore did not rank individually as the top winners in 2013 (having perhaps to do with factors other than VAT or customs duties), still, such figures may show in part the effect of applicable tax regimes.

Then there are the so-called “free ports,” located around the globe, which have become popular as a way to store works of art intended primarily as an investment. A free port is essentially a tax haven: artwork may be shipped directly to the free port, and as long it is stored there, VAT will not be assessed on the import. (Of course, once the work is shipped outside the free port to its new destination, any applicable tax will be assessed.) An additional benefit for potential purchasers (depending on the local laws applicable to the free port) is that VAT may not be assessed on any sales of artwork made within the free port—at least not until the artwork has left the free port. (So, hypothetically speaking, if a sale has been made, but the work never leaves the free port, VAT will never be assessed.) Arguably, the art fair Art Basel became popular just for that reason, having made its initial home base in a Swiss free port. As of right now, there are free ports located in Switzerland, Luxembourg, Singapore, and Beijing. (One of the best indications of how popular the Singapore free port has become is that Christie’s auction house now has an office located there.)

The EU Commission has previously expressed that VAT rates are not to be used to control social and economic policy in the EU, and clearly is increasingly attempting to pressure member states, whether through regulation, litigation, or other alternative avenues, to raise VAT rates to a uniformly high rate. However, in the face of global competition, one can only wonder what this trend may mean for the EU in the future as a major player in the commercial art markets.

 

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About the Author: Elizabeth R. Lash, Esq., serves as in-house counsel at Kroll, where she focuses on reviewing agreements relating to cyber security and data breach notification.

DISCLAIMER: This article was prepared by Ms. Lash in her personal capacity; the opinions are the author’s own, and do not reflect the view of Kroll Associates, Inc. or of its affiliates.

Update: Amid Protests of the Hopi Nation and Supporters, Auction of Sacred Artifacts Proceeds in Paris

By Ariel Friedman

This piece is an update to last week’s post: The Hopi Nation Attempts to Stop Paris Sale of Sacred Artifacts.

Amid protests, the controversial auction of Hopi mask-like artifacts in Paris proceeded as planned, over objections of the Hopi people and the United States government. The dramatic days leading to the sale were filled with diplomatic entreaties and a courtroom battle, attempting to keep the sale from going forward.

American diplomats applied political pressure to stop, or at least delay, the sale. On Wednesday, April 10, American diplomats met with French counterparts about the auction. The following day, Charles H. Rivkin, American Ambassador to France, released a statement that he was “very concerned” about the sale and raised the question of whether it should be precluded by the 1970 UNESCO convention on cultural property, to which both France and the United States are parties. Philip J. Breeden, cultural affairs minister of the US Embassy in Paris, also urged the auction house to delay the sale to allow Hopi tribal leaders to inspect the artifacts to determine authenticity and origin.

On the legal front, Pierre Servan-Schreiber, a lawyer from Skadden, Arps, Slate, Meagher & Flom, working in a pro bono capacity, convinced a French Municipal Court Judge Magali Bouvier in Paris to hold a hearing this past Thursday, April 11 to determine the legality of the sale. He made three arguments. First, he argued that the items should not be sold until it can be determined whether or not the artifacts were stolen from Hopi lands or had been sold in violation of American or international law. He argued that looking into this history would be impossible once the sale had taken place and the piece were dispersed to different buyers. Second, he argued that according to an old prohibition in French law, it is illegal to sell “non-commercial” items that are seen as “immoral” to sell. Because selling the artifacts that the Hopi regard as embodying spiritual beings would be sacrilege, Servan-Schreiber argued the sale would violate French law. Finally, he further argued that the law prevents sale of “emotionally charged” objects that have been in a family so long they have become communal, multi-generational property.

The lawyers for Gilles Neret-Minet, head of the auction house, countered that “the claim that Hopi cultural patrimony is exclusively their property has no legal basis according to French law.”
The auction house also argued that blocking the sale would have broad repercussions for the art market generally and could force French museums to give up their collections of indigenous works.

The decision in the case was announced at noon on Friday, April 12, a mere two hours before the auction was set to begin at 2:30pm. The judge ultimately found for the auction house, stating that despite their sacred status among the Hopis, the works could not be likened to dead or alive beings. The court also alluded to the American Indian Religious Freedom Act, enacted in the United States in 1978, but stated that “no provisions banning the sale outside the United States of objected used in religious ceremonies or susceptible to be is applicable in France.”

When the sale began, Gilles Neret-Minet addressed the crowd of 200 buyers, assuring them that the sale had been declared legal in court. He said that “In France, you cannot just up and seize the property of a person that is lawfully his.” He added that he was “concerned about the Hopi’s sadness… and would not gloat.”

Until the end, Hopi supporters attempted to stop or stall the sale. Protests continued inside and outside the auction house for the duration of the sale. Dozens of protesters urged patrons of the auction not to purchase the works. The protesters had friends in high places. Actor Robert Redford had pledged his support for the Hopi people. French filmmaker Jo Beranger came to the protest in support of the Hopi claims, wielding a sign with a 1970s image of a Hopi leader in tribal beads holding a mask. Beranger told the Associated Press that the auction a “scandal” and “shameful,” and was eventually escorted out of the auction house by security guards.

Ultimately, the sale brought in 931,000 euros ($1.2 million). Although many pieces sold for less than their low estimates and five of the 70 lots were unsold, there were some surprises. The most expensive lot was the “Mother Crow” mask, selling for 160,000 euros ($209,000)–triple its high estimate. When the auctioneer announced its selling price, the crowd clapped, while a protester shouted “Don’t purchase that. It is a sacred being.”

Sources: The New York Times, USA Today

The Hopi Nation Attempts to Stop Paris Sale of Sacred Artifacts

The Hopi People, a Native American nation residing in Arizona, have asked federal officials to assist them in stopping an auction of 70 sacred masks scheduled for this Friday, April 12, at the Neret-Minet auction house in Paris. The Hopi believe that the intricate masks and headdresses, which are adorned with horsehair, sheepskin, feathers, and maize, are inhabited by the spirits of warriors, animals, and natural elements, such as fire, rain, and clouds. The Hopi refer to these artifacts as Katsinam or “friends” and use them today in many ceremonies and harvest rituals, as they have done for thousands of years.

Leigh J. Kuwanwisiwma, director of the Hopi Cultural Preservation Office, believes that it is likely that the items were stolen. Historians say that many Hopi artifacts were taken long ago by people who found them unattended in shrines and on altars along the mesas of the Southwest. Missionaries attempting to convert the tribe also confiscated the objects in the late 19th century. Though some were sold by tribespeople, Hopi leaders contend that these were not legal sales, because they were made under duress and because individual members cannot hold title to religious artifacts, which are owned communally.

The auction is one of the largest of Hopi artifacts to date and the auction house estimates that the sale will bring in over $1 million. Many of the artifacts are more than 100 years old and are predicted to sell between $10,000 and $35,000. Neret Minet has stated that an unidentified collector legally bought the items in the United States at sales and auctions over 30 years, beginning in the 1930s. The auction house also reiterated that the auction complies with French law. The auction house director Gilles Neret Minet said that the “sale is not just a business transaction but a homage to the Hopi Indians.”

The sale is particularly offensive to the Hopi people because of its size and because of the religious significance of the items involved. The Hopi also point to a gross disparity between the United States government’s power in cases of attempted recovery of illicit artifacts. Though the State and Interior Departments state they can do little to stop the sale, the government is empowered to help a foreign country recover an object from the United States. Despite this, the Hopi stress, the government is unable to help retrieve an American artifact for sale overseas. In recent years, the Hopis have recovered dozens of artifacts from American museums and sought to block auctions in the United States. This is the first time their efforts have become international. The Hopi are circulating a petition imploring that the auction be stopped.

The battle over Native American artifacts has been a difficult issue for many years. Countless Native American artifacts and human remains have been taken from burial sites and reservations for hundreds of years. There remains an active trade in illicitly acquired Native American objects today. Although the government enacted the Native American Graves Protection and Repatriation Act (NAGPRA) in 1990 to force museums and federal agencies to repatriate artifacts that rightfully belong to Native American groups, the process can take years and there is still an active trade in illicitly acquired artifacts. Additionally, the United States does not have international accords, as it does with Italy or Cambodia, which require that American officials take these cases.

The New York Times interviewed Kate Fitz Gibbon, an art law expert in New Mexico, who stated that the Hopis may want to consider a claim that the items should be considered stolen property. However, such efforts require considerable time and money. She said that the Hopis might have to “resort to publicity and moral suasion” in order to draw attention to the sale.

However, similar public pressures were recently applied by Mexico, Peru, Guatemala, and Costa Rica to the Sotheby’s Paris auction of ancient pre-Columbian works two weeks ago. Although the profits were lower than predicted, the sale proceeded. It remains to be seen whether the Hopi will have better luck.

Source: The New York Times

False Friends: Parisot Accused of False Authentications of Modigliani

French word “paresseux”[pa ray seu]” does not mean ‘parasite’, it means ‘lazy’. That’s what we call a “false friend” in linguistics. In art history, “false friends” would aptly describes those scholars who provide false attribution and fraudulent certificates of authenticity, fail to comply with professional codes of conduct and take bribes.

Amedeo Modigliani is one of the most faked artists. A prolific Modigliani expert, Christian Parisot has written about this artist and his works for four decades. In fact, as the current President of the Modigliani Institute in Rome, Parisot, has been working on Modigliani catalogue raissones, a compilation typically used to weed out real works from fakes. Perhaps Parisot was too familiar with Modigliani’s work. In December 2012 he was arrested in connection to an international forgery investigation. Now, he is accused of providing false certificates of authenticity for works appraised at millions of dollars. Another individual identified in connection with the fake Modiglianis is an Italina art dealer Matteo Bignapiano. More details about their dealings are sure to follow.

For more “false friends” read about restorer accused of fraud in “Pompeii’s Head of Restoration Investigated for Fraud and Abuse of Office;” read about “Double Denied,” a case against the Andy Warhol Foundation for alleged collusion to manipulate the art market in “Term of Art: Authenticity;” read about questionable certificates of authenticity in ARTnews.

Source: Financial Times; Huffington Post; ARTnews.