Droit de suite – Artist’s Resale Right (ARR)
Dear artist, it’s your inalienable, economic authors’ right!
Work sale executed by the artist is not always a one-time payment for the author. However, not everyone knows about it. Each professional resale (i.e with the involvement of an art market professionals such as art dealers, galleries, or auction houses) on secondary market entitles the artist to receive a royalty based on a percentage of the sale price. And that is when one should get familiar with a term Droit de Suite also know as Artist’s Resale Right (ARR).
Cave.art respects this property law. To every sold piece we add ARR and we inform the buyer about this. Thanks to that, the artists receive a remuneration on account of every resale of their works and not only the first sale. What does it mean in practice? Basically, that not only will the first sale bring the income to the artist, but also every next transaction in the sales chain benefits them.
Then, what is droit de suite? It is worth knowing from the buyer’s position as well as from the artist’s or every other person interested in reselling their works via Cave.art.
The concept of droit de suite has its roots in a French legislation. As their Minister of Culture and Communication, Renaud Donnedieu de Vabres, has stated, it was introduced in 1920 following the sale of Millet’s The Angelus painting. Its value increased significantly after placing it on the market. After World War I painter’s family lived in the poverty just as many other artists’ relatives.
Droit de suite was supposed to stop it. The concept was introduced by the majority of the European countries. On 27 September 2001 harmonisation directive 2001/84/EC was issued.
Droit de suite is an inalienable, economic authors’ right letting the author and their heirs obtain royalties based on a percentage of the sale price in case of a sale of the original copy of artistic or photographic works or some others carried out by an art market professionals (eg. auction house, gallery, art or antique dealer). The catalogue determined by the legislator is quite wide: pictures, collages, paintings, drawings, engravings, prints, lithographs, sculptures, tapestries, ceramics, glassware and photographs. That means that photos count but videos are out of application of ARR. Copies made in limited number by the author or under their supervision, numbered, signed or otherwise duly authorised the author are also treated as original copies.
Droit de suite shall not be applied to private sales (incidental) and resale to the museums.
3. What is resale?
The term resale is given to every sale of the copy occurring after the the first transaction executed by the author. It means that if the work is being sold by the artist or any art market professional for the first time, the Artist’s Resale Right cannot be applied. However, when after some time, the collector decides to sell the object through an auction or in the gallery, the artist or their heir is entitled to benefit from the royalties.
Resale is every act of repeated sale within activity carried out by:
-other entity professionally dealing with trade of arts, or manuscripts of literary or musical works.
The term resale also covers activity at request of vendor and purchaser, putting in pawn, intermediation (even if the seller is a private person). A resale would be considered as a professional one even if only one of the transaction parties will be professionally dealing with art trading (showrooms, auction houses or art galleries also working only online).
4. Who is beneficiary of droit de suite?
The royalties are owed to the author of the work (or their heirs) if two conditions are fulfilled;
1. The author has Polish nationality or nationality of any other European Union member state or their habitual residence is in the Republic od Poland (or any other EU country concerned)
2. The author is alive or dead for less than 70 years.
5. When can one benefit from it?
A claim regarding the payment in virtue of Artist’s Resale Right settles in at the conclusion of the contract obliging the seller to transfer the ownership right of the piece. From that moment, the entitled entity (the author or heirs) may demand the payment of the royalties calculated as stated below.
One should approach the seller before the claim becomes time-barred. Currently, limitation period is of 6 years from the end of the year when the sale took place (as it is pecuniary claim, the application of status of limitation is in accordance with article 188 of Polish Civil Code). During 3 years from the sale date the information and access to the documentation necessary to calculate the Artist’s Resale Right may be demanded.
It should be kept in mind that all copyright laws exist for 70 years from the death of the author. This period is calculated from 1 January of the year following the passing of the artist. It means that ARR can be requested in regard to the pieces whose authors are alive or dead for less than 70 years, and resale took place less than 6 years ago. However, there are some exceptions from this rule.
6. Renumeration amount
In accordance to Law of Copyright and Related Rights the authors and their heirs are entitled to benefit from Artist’s Resale Right in case of resale carried out by the art market professional of the original copies of artistic works and literary and musical manuscripts of which the sale price exceeds 100€ (VAT not included) according to the following pay rate:
for the portion of the sale price up to 50.000€
for the portion of the sale price from 50000,01€ to 200000€
for the portion of the sale price from 200000,01€ to 350000€
for the portion of the sale price from 350000,01€ to 500000€
for the portion of the sale price exceeding 500000€
However, the total amount of the royalty may not exceed €12,500.
The final amount is calculated by assigning the sale price to the particular portions and adding them up.
Sale price of 250 000€ – droit de suite rate would be:
5% x 50000€+ 3% x 150000€+ 1% x 50000€ = 2500€+ 4500€+ 500€= 7500€.
In case of resale of literary or musical manuscripts the rate is established at 5% of the sale price.
7. Who is obliged to pay ARR?
The obligation of royalties payment is on the intermediary who is selling, which may be a gallery, auction house, antique shop, etc. Commonly, the cost of droit de suite is covered by the buyer as its amount tends to be included in the price they are paying for the piece. The data regarding the rates for the artist is provided in the information section of the auction or sale (B&M or online).
5. Is art market professional resposible for seeking the artist entitled to be paid droit de suite?
The seller (eg. gallery or auction house) is not obliged to inform the artist about the resale nor to seek them or their heirs and offering them the remuneration. The artist or the heir should approach the selling entity to obtain the amount due. The vendor should be always prepared for the possibility of the request to happen and put aside the funds to cover the ARR. If it is the heir who is submitting the droit de suite claim, they shall present documents proving their right to inherit.
Artist’s Resale Right claim is a type of pecuniary claim therefore the application of status of limitation is in accordance with article 188 of Polish Civil Code (currently the period of 6 years).
In Cave.art we take this responsibility on us. We take care of paying the amount due in virtue of droit de suite immediately after the professional resale we are involved in.