Brexit: what’s next for the UK art market?

As of today, Brexit is a reality and, although the United Kingdom (UK) will remain fully aligned with European Union (EU) law until the end of the transition period (which is still currently expected to be at the end of the year), once this period ends the UK will leave both the EU single market and the customs union.

It is quite evident that leaving the EU will make business with its member states more difficult, posing some significant challenges for the art market, but is also likely to offer opportunities further afield.

While some people believing that Brexit could have a hugely detrimental effect on the art world as well and lead to cultural isolation by imposing additional taxes and regulations, others view Brexit as an opportunity for the UK to gain its independence from the EU and create its own rules and regulations regarding art trade for the first time.

As the government has said it wants to diverge from European Union rules in many areas, therefore procedures for trade with Europe will change substantially.

Goods exported to the European Union will necessary become third country imports with the consequence that new paperwork, licenses, tariffs and, in some cases, pre-certification by European Union officials will be needed. Existing free movement rules will also end, therefore a visa and possibly a licence is likely to be needed before most work can be carried out in Europe.

Brexit will have an obvious effect on the UK art market, although the extent of any changes is still largely unknown.

As a major factor in the UK art market’s success has been down to access to overseas talent, additional restrictions brought in by Brexit could make movement far more challenging and inconvenient for UK art professionals and creative organisations.

Some fear that Brexit will bring about several restrictions and barriers that could harm the UK art industry. For instance, leaving the EU is likely to add additional expense and make transactions more time consuming and complex. This has the potential to deter people from trading with the UK art market.

This could reduce the number of individuals and groups from EU countries touring the UK and performing across the country. The same effect would also apply to UK professionals hoping to complete touring exhibitions around the EU[1].

            Also, for art dealers, free exchange of art between the UK and the EU no longer being possible, the paperwork, including import and export permits required for entry and exit, will increase the workload, and the lending and trading cycle of works will be extended.

Some people believe that the most immediate impact of the UK’s formal Brexit on the art market will be reflected in the fact that art dealings between the UK and the EU will require more procedures and more tariffs, but this will not shake the trading rules of the art auction market[2].

Here are some of the key ways that Brexit will impact the art industry.

Imports of EU’s cultural goods

For the art market, the flow of trade in art will become more complicated. This is partly because of new rules introduced in the EU’s “New import of cultural goods Act” in April 2019 (which will be gradually implemented between now and 2025, when a fully electronic system comes into force), which will be binding on British exports to EU countries once Britain leaves the EU Customs Union. The regulation covers cultural goods that are created or discovered outside the EU.

According to the Act, depending on the extent to which they are vulnerable to pillage and destruction, cultural works are divided into two categories under the draft regulation. The most vulnerable, such as archaeological objects, elements of monuments, and rare manuscripts, classed as “archaeological finds” (antiquities over 250 years old) will require an exclusive license issued by the exporting EU country.

Proof will also be needed of the legal export from the origin country. For many antiquities this paperwork does not exist.

Other goods over 200 years old will need only an importer statement so, in theory, a 20th-century painting worth £1 million can be imported with a statement, but a £50 ancient clay lamp would need a full licence.

Anyway, issues mentioned above aside, must be considered that, as the UK already issues export licences for cultural goods – and these will be accepted by the EU – export will be easier from the UK than from countries which do not issue export licences. However, proving the legal export from the source country will remain problematic until the European Commission publishes specific guidelines.

Since, as told before, the UK is very unlikely to replicate the EU rules after Brexit that could provide an opportunity for the UK art market, particularly with regards to hosting fairs, as it will be far harder to temporarily bring antiquities into the EU than the UK.

EU exports to the UK

The bigger challenge probably will be when art is exported from the EU to the UK. Currently, these exports are ruled by EU rules covering inter-EU transfers.

Post-Brexit, EU exports to the UK will require an EU export licence and are governed by a similar regime to the new import rules. However, unlike the import regulation, EU goods are also covered, making it harder to transfer goods from the EU to the UK.

It is already virtually impossible to export cultural goods from some EU countries, such as Italy, and the European Commission is keen to ensure further restriction on the export of European cultural heritage from Europe.

 Non-EU exports to the UK

Also, post-Brexit, art from non-EU countries will enter the UK more easily than the EU, and from there it can get a UK export licence allowing import into the EU. On one hand, this offers the UK an advantage in the global market, the chance to position itself as a gateway to the EU. But on the other, it will almost certainly become more difficult to export art from the EU to the UK and to do business in the EU in general.

More chances and challenges

Leaving the EU could provide new opportunities for the UK art market, especially when it comes to holding art fairs because it’s much easier to bring artifacts into the UK for temporary exhibitions than to bring them into the EU.

After the UK leaves the EU officially, infact, it will be easier for art works to enter the UK than the EU. By entering the UK, art dealers can obtain a UK export license, which can be used for EU imports.

In short, therefore, what will almost certainly pose some obstacles in the art market and in the circulation and relations between the UK and the EU, could however represent and give the UK an advantage in the global art market, allowing it to position itself as a gateway to the EU. But on the other hand, it will also make it more challenging for EU countries to export art to the UK, and also affect the EU’s art market as a whole.

Paola Ghirardelli

Solicitor of England and Wales

[1]According to a study by the Art Council, around 64% of culture organisations currently work inside the EU. These statistics suggest that restrictions brought on by Brexit could negatively affect many creative individuals and organisations within the UK art scene.

[2]Indeed, the rare masterpieces on display at Sotheby’s auction in London on the evening of February 4 are still in demand. Although the sale grossed 499.903 million pounds, it was down 42 percent from the same period last year.

Tags: ART LAW, art market, Brexit | Categorie: ART LAW, BREXIT, MISCELLANY