The resale right on the sale of a work of art will be centralized

Analyse To optimize the administrative management of the resale right on the resale of a work of art, a unique platform will be established that centralizes all information regarding the works of art, which are offered for sale.

1. What is the meaning of "resale right"?

The resale right is a royalty, enjoyed by the author of an original work of graphic or plastic art whenever his work has been resold, subsequent to the first transfer, provided that the seller, the buyer or the intermediary is an art market professional.  

This concerns particularly the sale of work of art with the participation of sales rooms, art galleries, art dealers and, in general, any dealers in works of art.

2. Works of art to which the resale right relates

The resale right is intended to ensure that each author (or his successors) share in the economic success of their work of art due to the fame he gained after the first sale.

Without this resale right, artists, who had to sell their artwork at relatively low prices at the beginning of their career, would not enjoy the success they get later and the higher value that their work gained thereby in the art market. 

The resale right relates to original works of art (made by the artist himself or copies considered to be original works), namely works of graphic or plastic art such as pictures, collages, paintings, drawings, engravings, prints, lithographs, sculptures, tapestries, ceramics, glassware and photographs.  

3. How was the resale right settled up to now?

The resale right was introduced in Belgium by law in 1921. 

The European Directive 2001/84/EG of 27 September 2001 on the  resale right for the benefit of the author of an original work of art, harmonized its scope and rates.  

The actors of the professional art market that are involved in a resale are jointly liable to notify the sales that have been realized every 3 months

The transposition and implementation of the transposition of the European Directive 2001/84/EG has been realized by the law in 2006 and by Royal Decree in 2007. 

The resale right has to be calculated on the sale price excluding tax, provided that the minimum sale price is 2.000 euro. 

On the sales price a degressive percentage is applied , starting from 4 % of the first tranche up to 50.000 EUR to 0,25 % for any part of the resale price exceeding 500.000 EUR. The maximum amount of the resale right may not exceed 12.500 EUR.

For works of art up to 10.000 EUR, resellers are exempted for paying the resale right if the work of art has been purchased directly from the artist and resold within 3 years. This is interesting for art galleries promoting young artists with certain investments (exhibitions, books and catalogues, ...). 

The actors of the professional art market that are involved in a resale as seller, buyer or intermediary, and the seller are jointly liable to notify the sales that have been realized every 3 months (before the 20th day after the end of each quarter) to the author or the company responsible of the management of his rights. The resale right must be paid within 2 months after this declaration.

In the context of a public auction, the notification must occur within one month after the sale. The payment of the resale right must also be made within 2 months after the notification.  

After that period, the resale rights that could not be paid (because e.g. the data of the author could not be determined), will be paid on a common bank account of the management companies, that where appointed by the Royal Decree of 2007, namely Sabam or Sofam. 

These companies have to publish each year in the Belgian Official Gazette and on their website a notification of :
- the list of resale right owners whose works have been sold in the previous calender year and that gave rise to the payment of a resale right on the joint account, or
- if the beneficiaries could not be identified, the list of the resale of works that gave rise during the previous calender year to the payment of resale rights on the joint account. 

Authors have a limitation period of 3 years after the notification to claim their resale right. 

4. Creation of a unique platform

In practice, the exercise of the resale right causes a lot of problems.  Sometimes the payment of the resale right cannot be made, since it is not always easy to track down or identify some artists. It is sometimes difficult to know to whom the payment should be made, etc... 

A unique platform as a single point of contact for the resellers and the artists, should offer a solution to these problems. 

The unique platform has already been provided for by the law, but its entry into force has been postponed until 1 July 2015. 

At the same time, a number of amendments were introduced; the limitation period to claim the resale right is extended to 5 years and the notification will be made electronically.

A unique platform as a single point of contact for the resellers and the artists should offer solution for a lot of issues

On 27 February 2015, a Royal Decree was approved that provides in the creation of such a unique platform and determines the conditions it has to comply with, as well as the terms of the administrative management of the resale right.  

The unique platform will be established by Sabam and Sofam, and will centralize the notifications and payments of the resale right in Belgium.

The unique platform will have to publish on its website, within 3 months after their notification, the list of the works of art for which a notification of a resale by art market professionals were made. 

The aim is to ensure more transparency in the management of the resale rights; both for the actors of the art market and for the right holders. 

The draft Royal Decree (establishing the conditions and terms for the management of the resale right) is submitted for advice to the State Council. 

We keep you informed about this new legislation.

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Leo Peeters

Leo Peeters

Ann Vranken

Ann Vranken

Lawyer & Editor