You may remember a painting that made headlines when it sold at Sydney Contemporary last year – it was an important work by one of Australia’s most significant artists, it had been kept at the end of a bed for decades and it sold for a record price at the time. It made for a great story.
But you may not be aware there was something about the story that wasn’t quite right.
During the same period the artist was enjoying a renewed level of appreciation and exposure with a critically acclaimed survey exhibition in Sydney. And as such, the value of his works on the secondary market were steadily increasing and the great man was about to board a plane to America for the Beyond Dreaming symposium.
On the surface things were looking great. But beneath that surface he was, like many artists, struggling financially – I had even heard reports he was working at a service station to make ends meet. I had no idea.
I thought to myself how could one of Australia’s greatest living artists be in this position? How can we be applauding his genius on an institutional and international level and reaching record prices on the secondary market and yet, at his age, he’s not able to look forward to a comfortable life?
Shortly after the record sale I was approached to make a voluntary resale royalty contribution to the artist – a resale royalty wasn’t applicable in this case as the artwork was bought well before June 2010. The vendor and I agreed to co-contribute a royalty payment and the artist ended up with 5% of the sale price.
I’ve intentionally left the artist’s name out of this post - the reality is this could be any number of artists.
This story was not something that I was going to openly publicise, but it was the catalyst that got me thinking - there has to be more we, as participants in the secondary art market, can do.
Since the resale royalty legislation was forcibly introduced during a market downturn in 2010, the pros and cons have been debated from all sides of the market, including from within Government. I for one, was not happy.
But now that the market is in a much more stable and strengthened position, I can reflect on this matter from a clearer standpoint - that those who benefit most from a now clearly rising secondary art market, should do their bit to support the artists and families who fundamentally created it.
And while resale royalty is law, we should make the best out of the situation and take what is generally seen as a negative and turn it into being a very strong positive.
Under the current law, approximately 1 in 10 artworks are being captured by the resale royalty scheme – though that number will continue to increase as the years go by.
I think we can do better than that.
Over the last 12 months, I’ve had discussions with Community leaders, artists and industry colleagues and heard a range of viewpoints on the matter. The one thing that continually rang true was – the extra funds certainly make a difference.
I think the main reason for the disconnect between the primary and secondary markets on this issue is because the primary market doesn’t readily see the indirect benefits that the secondary market generates – confidence within the overall market.
So how can the secondary market have a more direct impact? The clear idea for me would be to introduce a voluntary resale royalty on my sales of Australian Indigenous contemporary art.
This is what I’ve decided to do.
From January 2020, the seller will now have the option to include a voluntary resale royalty of 2.5%. And if the seller takes up that voluntary option - I will match it with another 2.5% which will come out of my retained commission on that sale.
If the option is taken by the seller, this will simply take my selling fee from 20% to 22.5% (still considerably lower than any auction house can offer). And the buyer will pay no more.
I want to emphasize here that this is a voluntary initiative – I understand that everyone has their own reasons for selling and there will be no pressure to pay a voluntary royalty. The option is simply there.
At the end of each year I will report the total amount of ‘voluntary’ royalties paid, providing a completely transparent and quantifiable direct benefit which goes to the artists and their communities.
This is a positive revenue stream for Indigenous communities, generated by the artists and their forebears’ ingenuity and hard work. Unlike Government subsidies or grants – this is an income generated by the people for the people. It’s healthy.
We should keep our focus on the ‘good-will’ of resale royalties and recognise that we as collectors (and dealers) are willing participants, responsible for not only the market’s success but for the sustainable benefit of the people that created it.
I believe - by bridging the gap between the two cultures - it’s an important step towards building harmony between the market and its creators. After all, one simply cannot flourish without the other.
I'm now consigning for exhibitions and private sale in 2020, if you have an artwork or collection you're thinking of selling, get in touch.