Practice · Private capital and collections · Reference
Ask who pays the advisor before you ask what to buy. Get the answer in writing.
A first buyer usually has two questions. How do I find an advisor who is independent of any gallery? And what does the first year look like? The first can be answered in one meeting, in writing, and you can check the answer. The answer to the second is an order of decisions. Most of what goes wrong in a new collection is a decision taken out of that order.
Published by ArtisDomus, written by Polina Surina.
The first meeting
Use the first meeting to test disclosure.
Every advisor leads with taste, and a first buyer cannot judge taste yet. Anyone can judge disclosure straight away, and disclosure is what independence means in practice. Five questions are enough. Each has a straight answer that can be put in writing. An advisor who refuses to put one in writing has given you an answer.
- Who pays you, and does anyone else pay you anything? A straight answer: one fee from the client, and nothing from a seller in any form. That rules out rebates, kept discounts, introducer fees and any share of a gallery’s margin. If the advisor describes the fee without ruling out the rest, the question is still open.
- If a gallery offers a discount, whose is it? A straight answer: it belongs to the client, passes through in full and shows on the invoice the client sees.
- Do you own stock, or hold works on consignment? A straight answer: yes or no in writing, and if yes, the list. An advisor who sells from their own stock acts as a dealer in that sale. That is a legitimate business, and a different one.
- What happens when I want to sell? A straight answer settles this in advance. Who acts, and on what terms? Can the same person be paid both for advising the purchase and for arranging the resale?
- What will you refuse? A straight answer is a list of work the advisor turns away. A refusal counts when it costs the advisor work they could have taken. A practice with no such list has never been asked.
ArtisDomus advises owners independently of any gallery. The owner pays the fee. ArtisDomus takes no commission from a seller in any form and passes on every discount it negotiates.
How an art advisor is paid, and where the conflicts sit sets out what auction houses publish about their fees, and what advisors keep to themselves. What a contract with an art advisor should say about commissions and disclosure turns the same questions into clauses. Read the difference between an art advisor and a cultural strategist before deciding which of the two you need.
What is refused
An engagement here starts with the structure, before any single work.
A new buyer often names a work, an artist or a fair and asks for help to get it. ArtisDomus declines that instruction: finding one picture is a transaction. Its engagements cover the structure the picture sits in. The practice also takes no commission from a seller in any form, no resale brokerage and no decoration work. It declines any engagement where it cannot examine the other side’s reputation. The full list of refusals is public, and each item on it turns away work that is there to be taken.
For a first buyer, this changes the first year in one way. The first engagement produces documents, and the works follow from them. It also closes the most common route into a new collection. That route is an advisor paid by whoever sells you the work, who therefore chooses among the works that pay.
Two consequences follow. If you want one picture for one wall by a set date, ArtisDomus is the wrong choice; say so in the first meeting. And if a seller’s reputation cannot be examined, the purchase does not go ahead, however good the work is.
Documents
Four documents, each settling a question the next one relies on.
A good first year produces four documents. Each one settles a question, in order. A document written late only describes what has already happened.
- The engagement letter. Who pays, and that nobody else does. What is disclosed and when. Who owns the records the engagement creates. What happens on termination, and whether anything is owed on a purchase completed after it. Write it before looking at any work. Once a work has been found, the buyer can no longer bargain over the fee.
- The collecting statement. What the collection is for, who it is for, and what it leaves out so that it has a point. It is short and in the client’s own words, after editing. Write it before buying starts. Written before, it guides the choices. Written after, it only describes them.
- The acquisition policy. How a possible purchase is tested, who decides, who can say no, and what happens in a close call. A good policy is one someone else could apply without asking its author. This is the document a family office lacks. A first buyer can have it from the start and avoid rebuilding it thirty years later.
- The acquisition file, one for every work. Ownership history. The seller’s right to sell. The description you were shown, kept in the exact version you saw. The certificate and what it binds. A dated condition report that names its author. The basis of the invoice. A copyright licence if you plan to photograph the work. Open the file before any money moves, because the invoice is the last chance to fix any of it. If the artist is alive, the file can be checked with the artist; checking a contemporary work is authentic sets out the order of questions.
The fourth document has the law behind it. What to check before you pay for a serious work takes the eight checks in order. The entries on provenance, the certificate of authenticity and the catalogue raisonné explain what each document is and what it leaves open. Are gallery prices negotiable covers the price itself.
The first year
Each decision is cheapest just before its stage closes.
The stages below come in order. If the first year runs long because the collecting statement was worth arguing about, it worked.
- Engage the advisor, and settle the fee and the disclosure. This costs nothing now. Once a work is on the table, the same conversation becomes a negotiation against a deadline.
- Write the collecting statement. This costs nothing now. Once buying has started, the statement gets written backwards from the purchases, and then it can only explain them.
- Look widely, and buy nothing. This stage cannot be made up later. A first purchase made before you know the field sets the benchmark for quality and price. Everything after it is judged against that benchmark, including by the buyer.
- The first acquisitions, each with its file opened first. Two dates decide whether a work can leave a country: when it was made and how long it has been there. The seller will answer while there is still a reason to. Afterwards the dates are hard to get.
- The record and the insurance cover. An insurance claim is paid from the catalogue. Build it as the works arrive. Started later, it becomes a project nobody wants to begin. Cover written against an incomplete record covers the wrong things.
- Rights and movement. Get the licence to photograph a work at the same time as the work. It comes from the artist or the estate. Asked for later, it is a cold request with no leverage behind it.
Five things become expensive or impossible once their stage has passed. The fee basis, once a work is found. The description you were shown, if you did not keep it. The two dates on origin and entry, once the seller has been paid. The copyright licence, once the artist has moved on. The catalogue, once there are so many works that nobody wants to start it. Everything else can be fixed later, at a cost.
Insuring and cataloguing a collection split across two countries explains what the record must contain. It also shows how one published policy wording ties cover to the addresses listed in its schedule.
Where you are buying
The same purchase follows different rules in Europe and the Gulf.
ArtisDomus advises in Paris, Malta, the United Kingdom, Qatar and the Gulf. Each market has its own rules, and the differences affect a first purchase.
In France, the VAT rate on the work differs from the rate on a sale taxed on the dealer’s margin. Taking the work out of France later may need a certificate for its category. The State can refuse the certificate and then offer to buy the work. See French VAT on art bought in a gallery and taking a work out of France.
In Malta, cash payments are capped. The cap binds the buyer as much as the dealer, and a series of linked transactions counts together. See the cash limit when buying art in Malta.
In the United Kingdom, an object of cultural interest above a certain age needs a licence to leave. A resale royalty applies to qualifying sales, and it cannot be waived. See the United Kingdom export licence and the artist’s resale right. For a work in Belgium, the authority that issues the export licence depends on where in Belgium the work is. See the export licence for leaving Belgium.
For a buyer in Qatar or elsewhere in the Gulf, a work bought in Europe needs its own licence to leave the European Union. A carnet, the customs document for temporary entry, lets a work into the Gulf for an exhibition and nothing else. See moving a collection from Europe to the Gulf, and what acting in Europe and the Gulf for one client requires. See also customs duty on a painting imported into the UAE, storing art in a UAE free zone and insuring a work kept in another country.
Read next
Read these before the first meeting.
How an art advisor is paid, and where the conflicts sit · Reference. Read this first: everything else depends on it.
What a contract with an art advisor should say about commissions and disclosure · Reference. The same questions as clauses.
What to check before you pay for a serious work · Reference. Eight checks, in the order to make them.
The difference between an art advisor and a cultural strategist · Glossary.
Acting in Europe and the Gulf for one client · Reference. For a buyer whose collection will be spread across countries.
What happens when a collector dies · Reference. A distant question, and the reason to build the record from the first work.
Sources
- Acts and instruments
- Consumer Rights Act 2015 (2015 c. 15), ss. 11 and 17. Copyright, Designs and Patents Act 1988 (1988 c. 48), s. 11. Export Control Act 2002 (2002 c. 28) and the Export of Objects of Cultural Interest (Control) Order 2003, S.I. 2003/2759. Artist’s Resale Right Regulations 2006, S.I. 2006/346. Code général des impôts, art. 278-0 bis. Code du patrimoine, arts. L111-4 and R111-1 to R111-9. Code de la propriété intellectuelle, arts. L. 111-1 and L. 111-3. Use of Cash (Restriction) Regulations of Malta, S.L. 373.04. Council Regulation (EC) No 116/2009 and Implementing Regulation (EU) No 1081/2012. Convention on Temporary Admission, Istanbul, 26 June 1990. Common Customs Law of the GCC States.