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The European art market, between London and New York

The European art market, between London and New York

When it arrives on the art market, our favourite painting, the sculpture that fascinates us or any object that may be the subject of a collection becomes merchandise.

Arts, actions and auctions

The topic of the day, Brexit, seen as a clash of markets, will have minor consequences for the International art market. The main competitors on this market – the US, China and the UK – are outside the community subject and London, the largest provider of art auctions in the world, operates more in America and Asia. Christie’s and Sotheby’s, the two auction houses in London, each with a quarter of a millennium of existence and experience, organize real art auction campaigns, in New York, every year, in May and November. That is when new records of the international market are set, whether it is for the top artists, or for the general level of the market. Basically, the title of the most expensive work of art in the world was disputed and granted only after auctions organized by Christie’s or Sotheby’s at New York. From the beginning we must emphasize that when talking about the art market and its indicators, we do not take into consideration the so-called private auctions, which are totally opaque and where the market mechanism is not working as it would ideally operate in a public auction.

In May 2015, Christie's sold Picasso’s „Les femmes d’Alger (version 0)” with 179.365 million dollars, the highest price achieved so far in a public auction for a work of art. Last November, Modigliani’s „Nu couché” stopped at 170 million dollars. Until the Picasso record, the most expensive work of art was a triptych with Bacon's signature, a set of studies for a portrait of his no less famous friend, the painter Lucian Freud. The lot was sold in November 2013, also by Christie's and also in New York, for 142 million dollars. In May 2012, one of the alternatives of "The scream" by Munch received 120 million at a Sotheby's sale. In a May 2010 Christie's auction, a painting in the consecrated style of Picasso, „Nude, Green Leaves and Bust” was dethroning, with 106.5 million dollars, another Picasso, „Garçon à la pipe”. The latter painting was in the old-fashioned way of the "blue period" and had previously been sold for 104.2 million dollars by Sotheby’s in May 2004 in New York, breaking the one hundred million dollar mark for the first time.

Fine art never defects

Apart from the best known sessions in New York, the emerging Chinese market is a growing part of the international market, characterized by live events that are both interesting and exclusive through their expense. In London, in the new premises or the traditional one of the tandem formed by Christie's and Sotheby's, auctions are happening that gather interest and money from around the world. Shoulder to shoulder, the two legendary houses organize campaigns and sales worldwide, pursuing each other everywhere. It is almost impossible to find a place where only one of the two art auction houses founded in London about two and a half centuries ago is present. Until recently, on the map of their spreading in Europe, besides Eastern Europe, there was another bright spot, hexagonally shaped, just across the English Channel which separates continental Europe of the British Isles or, from another point of view, the British continent from Europe's big island. The bright spot was France, of course, the European Union partner country, where neither Christie's nor Sotheby's were allowed to organize auctions on their own behalf. And not since yesterday or today, but for centuries, namely since 1556, during the reign of Henry II. The Edict then did not speak about Londoners, nor about Picasso or the Brexit, regulating simply the functioning of the professional body of priseurs-vendeurs, giving them an exclusivity which lasted through the centuries.

The art (of) protectionism

The case in question lies in the common market rights which, in Sotheby’s vision, were harmed by this ancient and French legal exception. The situation did not bother anyone, at most it bothered the two houses of London, forced to hide on the outskirts of France, in Monaco, Geneva, Brussels, but without much enthusiasm, the most prestigious items being readied for sales in New York. However, in the early 1990s, France was the target of a complaint in Brussels for the violation of the European common market through its centuries-old interdictions on foreign art sales that kept London houses from organizing auctions on its territory. In other words, the Britons, whose tortuous European road had gained them the benefits of countless exemptions from EU regulations, were themselves complaining for the breach of those laws and principles that would strangle ancient privileges and traditions. Actually, to be fair, it was not the center offices of Sotheby's, in London, who led this fight. For them, this was a sideshow compared to their American operations. It was Sotheby's France who made the claim and conducted the entire procedure which led to the change of the centuries-old French legislation.

In 1995, a judgement finally penalized Paris for the breach of Article 59 of the Treaty of Rome, related to freedom of the provision of services, and in 2000 a French law was adopted that backed the European-British interests. In 2001, the law enforcement decree was issued which brought major changes to the regulation of the comissaire-priseur (auctioneer) profession, which was essentially connected to the art market. The next step was a raid in Paris conducted by the two houses of London, with the opening of headquarters and all of the fanfare, including prestige sales that nevertheless did not break any records.

A touch of Romania

The art scene was essentially enriched, but without significant developments in the underlying structure of the art market, venues such as New York, London, Hong Kong being the preferred destinations of significant flows of art works. There are hints that the whole process started out and was followed through as the personal ambition of the Princess Laure de Beauvau-Craon, head of Sotheby's France in 1991.

The European contemporary art market is, however, very important and is based primarily in London. Adrian Ghenie, our celebrity painter, can testify to this. Coming from Cluj via Berlin, his star rose solidly on the artistic firmament and in share auctions in London, but also the New York auctions in February 2016, where he was again a fixture at Sotheby's.

Beyond all this and questions of what happened or will happen, we are left, of course, with the previously described and beautiful example of exercising effective rights (of any kind), but also with a demonstration of the principles and solidarity of a united Europe in action, working for the benefit also of those who would not believe in them.

 
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OEconomica No. 1, 2016