What are Artist Resale Rights?

by | May 3, 2024 | Blog | 0 comments

What are Artist Resale Rights?

Artist Resale Rights (ARR) entitles the creators of original artworks to a royalty every time one of their artworks is purchased on the secondary art market.

Why are Artist Resale Rights important?

If an artist sells an artwork for a lower price point early in their career, the buyer might resell the work for a profit once the artist’s work has increased in value. In this case, the owner of the art is enjoying the increased price point that the artist has brought about through their work. Before Artist Resale Rights were introduced, there was very little way for an artist to benefit from the profit that they were helping to make for their collectors. ARR means that the artist has a right to benefit from their own success as well; this helps keep the art market healthy for both artists and buyers.

Which artwork sales are included?

To qualify for Artist Resale Rights, an artwork has to be:

  • An original artwork. This includes paintings, engravings, sculptures and ceramics.
  • Resold through an art market professional, such as our online platform or an auction house.
  • Valued at £1000.00 or more. (The threshold used to be €1,000.00, before 1st April 2024.)
  • Sold within the UK, the European Economic Area (EEA) or Australia.

Which sales are exempt?

Not all secondary art market sales will attract ARR. Exempt sales include:

  • Sales that take place between individuals, or sales to a non-profit organisation such as a museum.
  • The sale of an artwork that was purchased directly from the artist less than three years previously, and is being resold for less than £10,000.00. This is known as the ‘bought as stock’ exception.

Interestingly, a resale is not exempt if the original transfer of ownership was not technically a sale. If you were given an artwork as a gift, ARR royalties still need to be included when you sell it on.

Which artists qualify for Artist Resale Rights?

Which artists are included?

For an artist to qualify for Artist Resale Rights, they have to be either a UK national, an Australian national, or a national of a country in the EEA. There are also a number of Free Trade Agreements (FTAS) between the UK and other countries that include ARR, which means UK nationals may be able to claim royalties from sales that take place in the EEA and Australia. There may soon be legislation in place than includes New Zealand as well.

Artist Resale Rights used to only apply to living artists. However, the law has now been changed so the royalties are available for the same length of time as copyright – an artist’s beneficiaries or heirs can collect ARR for up to 70 years following their death.

How are royalties calculated?

Artist Resale Rights royalties are calculated on a sliding scale, but are also cumulative.  As of 1st April 2024, the tiers are as follows:

  • Up to £50,000: 4%
  • Between £50,000.01 and £200,000.00 : 3%
  • Between £200,000.01 and £350,000: 1%
  • Between £350,000.01 and £500,000: 0.5%
  • Over £500,000.00: 0.25%

For a cumulative calculation, the example provided by government guidelines is a sale of £200,000.00, for which the ARR would equal £6,500.00. This is because the first tier (up to £50,000.00) would equal a royalty of £2,000.00 (4%) and the second tier (between £50,000.01 and £200,00.00) will attract a royalty of £4,500 (3%).

How do artists get Artist Resale Rights royalties?

The seller of the artwork, and the art market professional responsible for the sale, are jointly responsible for the ARR royalties being paid. However, artists can’t apply to sellers directly to collect their royalties. Instead, they must sign up to a recognised collecting organisation, such as Design and Artists Copyright Society (DACS) or Artists’ Collecting Society (ACS). These groups will arrange for the royalties to be collected and then paid to the artists.

Our view

When we resell artworks online, there are a number of factors that contribute to our overall pricing. Artist Resale Rights is an often-unnoticed element in the secondary art market, but these royalties are an absolutely vital part in making sure that artists are able to benefit from their own success. We are dedicated to making sure all the artists we represent are able to claim the royalties they are due, ensuring that the art market, and its creators, continue to grow and thrive.

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