TIAMSA Blog: Paris Art Market Day 2019: Transparency, Technology, and Transferring the Market

By Claudia S. Quiñones Vilá

On November 18, 2019, Le Quotidien de L’Art hosted its second edition of the Art Market Day at the Grand Palais, in the heart of Paris. The event was attended by numerous interested parties, stakeholders, and practitioners with varied backgrounds, reflecting the art market’s current dynamism and overlap with other industries. The use of a dedicated app and a start-up village accompanying the event added to the sense of multidisciplinary integration. During the course of the conference, three distinct areas of concern emerged: 1) an external emphasis on transparency/trust, illustrated by market trends and the EU Fifth AntiMoney Laundering Directive; 2) the role of technology and digitalisation in art forms, marketing, evaluation, and transactions; and 3) the potential impact of Brexit on the art market (i.e., is the UK’s loss Paris’s gain?). Both speakers and the audience engaged in a stimulated discussion, expanding on the panels’ themes and applying lessons to real-life practice.

The opening speeches by Chris Dercon (Grand Palais), Franck Riester (French Minister of Culture), and Frédéric Jousset and Fabrice Bousteau (Beaux Arts & Cie) stressed the importance of cross-border dialogues to understand how best to exploit the art market’s unique characteristics. Paris’s status as a global city of art and culture attracting high levels of public interest and creativity seems to indicate that it will be the European successor to London after Brexit, although not everyone is convinced that the UK will be eclipsed so easily. While the main two auction houses – Sotheby’s and Christie’s – have a strong presence in, and ties to, France, they also have offices all over the world, increasing their potential to drive the market in different locations, particularly in Asia. The percolation of art and culture into various forms (design, luxury brands, etc.), implementation of digital platforms (such as Google Arts & Culture), and potential creation of a “Silicon Valley” for art technology are additional factors making the market more competitive on a global scale.

The intersection of art and technology was illustrated in an interesting and tangible way by the first keynote speech. Ravi Vora of Catawiki, an online auction website, provided the perspective of a non-art-specialized practitioner with experience in creating a curated marketplace. Vora highlighted the emergence of passionate enthusiasts (as opposed to collectors) as crucial for market success. These individuals are self-educated, have disposable income, and see art as an asset or status symbol. The ability of artists and purchasers to interact directly via the website, as well as its easy access for global transactions, means that Catawiki is able to pinpoint several long-term prominent and increasingly popular trends. These are: 1) regional hubs becoming more global; 2) new supplies from unexpected places, particularly through the use of technology; and 3) new ways of consuming art, such as digitally.

Continuing the focus on technology, the morning’s first panel discussed how big data can provide new tools as well as solutions for the art market. Moderator Adriano Picinati di Torcello of Deloitte presented relevant findings from the most recent iteration of the Art & Finance Report released in October 2019. He indicated that wealth generation and art acquisition are intersecting more than ever before, creating multiple opportunities for the market to evolve. However, the area of trust and transparency remains a concern. Sophie Neuendorf of Artnet announced the company’s new initiative of price indices that will be launched next year. This will allow users to follow art pricing much like stocks and to speculate on the value of works. These indices, in addition to flexible analytics reports, should open up transactions and increase transparency. Aleksandra Artamonovskaja of .Art Domains explained how her company utilizes a holistic approach to navigate the art market through the use of an algorithm which helps them determine the best online domains for their clients. They use digital intelligence to rank the online presence of art fairs, artists, and businesses and to allow their clients greater control by preventing cybersquatters from monopolizing domain names. Finally, Dorit Straus of Wondeur AI and Pontus Silfverstople of Barnebys provided insight into how analyzing market trends goes beyond mere statistics. Incorporating value creation, biases, customer surveys, and categorized searches allow buyers, sellers, and intermediaries to engage in more equitable relationships. Younger generations are data-driven, and appealing to their tastes will increase competitiveness, both now and in the future.

Next, panelists on digital art discussed how this relatively new type of work is affecting the market. A representative of ADAGP (Society of Authors in the Graphic and Design Arts) compared recent sales to the AI portrait sold at auction last fall.[1] These pieces are rarely sold on the secondary market, and their form impacts artists’ rights and copyright protection, as they are often shared online without permission. Elena Zavelev, founder of the world’s first digital art fair (CADAF), tied into the previous panel by mentioning the use of Blockchain to create a transparent market for new media. Nanne Dekking of TEFAF and Artory discussed the synergies present in digital art, particularly as a form of collective artwork that is popularly shared on social media. He echoed Zavelev’s mention of Blockchain, stating that it was a practical means to input the relevant information of a work as part of a buyer’s due diligence, making this process visible. Malo Girod de l’Ain of Monart concluded by examining the role of digital platforms as intermediaries and digitized versus digital art.

Halfway through the conference, the issue of Brexit took center stage, at a panel moderated by Fabrice Bousteau. First, Touria El Glaoui of the 1-54 Contemporary African Art Fair noted that non-EU countries are already paying VAT and fees on artwork. Thus, Brexit would not be a catastrophe for the UK but rather make it comparable to Switzerland’s role in the art market relating to the EU. Secondly, as Michele Casamonti of Tornabuoni Art Paris stated, while the process’s prolongation has resulted in uncertainty, which in turn affects the market’s confidence, art market structures are global in nature. It is therefore important to look at the long-term impacts of Brexit. New York is still the primary art market, but commercial platforms and collectors continue to be established in London, and – intriguingly – Hong Kong may have a greater overall impact than Brexit.

Nicolas Chwat’s (CC Art) keynote served as a thematic precursor to the panel on the regionalization of the art market, moderated by journalist Georgina Adam. Chwat noted that collectors/property owners are, on average, older and male, and prefer to display art in their private homes. They are becoming more interested in philanthropy, which affects conservation and collecting strategies. Cécile Verdier of Christie’s France highlighted the importance of understanding buyers, building relationships with them, and knowing why they purchase and collect. Although there has been a shift towards online sales and a decentralized model, there is no substitute for expertise in the field. Simultaneously, global companies such as auction houses rely on local employees for support and cultural liaisons to expand their influence. This means that the market is at once global and regional. Dekking participated in this panel as well, focusing on the environmental impact of the art market – especially with the increasing number of international art fairs – and efforts to make it more sustainable. Rob Weisberg of Invaluable noted that the online shift comes with its own particular set of challenges but allowed providers to interact with a wider community despite geographical borders.

Presenters on the following two panels tackled the art market’s economic concerns. First, the 5th European Anti-Money Laundering Directive implements reporting obligations similar to those for the financial sector. They require art market participants, including dealers and auction houses, to implement internal controls, identify the ultimate beneficiaries of transactions, and uncover suspicious behavior for transactions over 10,000 euros. Despite the Directive’s benefits, members of the art market have been extremely resistant. This corresponds to the market’s long history of self-regulation and confidentiality. However, with terrorist and criminal organizations using art and cultural heritage to launder money and finance their activities, the market needs to adopt a systematic approach and consider that greater transparency is not only a positive thing, but also necessary for today’s society. Next, gallery owners discussed the lack of specialized financial services providers for art businesses. In order to stay relevant, they need to find new ways of doing business, such as finding private backers, making partnerships, or creating niche services.

Georgina Adam concluded the event by summing up the three main themes that emerged throughout the day: Transparency, Technology, and Transferring the Art Market. Adam asked the audience to question whether measures are directed towards the right targets and whether dealers actually want more regulation. She further noted that after an initial period of resistance, the market appears to have embraced technology and that can help practitioners be more professional in the course of business, assess how art is consumed, and use data for good. Technology can also help with the issue of sustainability, which affects everyone on a global scale. Regarding Brexit, it remains to be seen whether the UK market will indeed shift to Paris, but the city has the infrastructure to increase its reach if it makes itself friendlier to foreigners. The interplay between global and regional markets can aid this phenomenon.

Overall, the Art Market Day was an intensive look into pressing matters affecting the art market today. We look forward to next year’s edition and seeing how the roster of participants and speakers continues to expand.

Claudia S. Quiñones Vilá is a licensed attorney in New York and Puerto Rico with experience in civil international law and an interest in the art market, private collections, cultural heritage, sustainable development, urban law, and public policy. She currently works at Amineddoleh & Associates, a leading NYC legal firm dealing in art and cultural heritage disputes for high-profile clients, including the Cultural Ministry of Greece. In 2018, she completed an internship at UNIDROIT in Rome focusing on cultural property. In 2019, she received honors for her master’s thesis on cultural heritage legislation and policy in the EU as part of the EUPADRA MA/LLM program hosted by LUISS Guido Carli University (Rome), the Universidad Complutense (Madrid), and the University of London. She is also a member of The International Art Market Studies Association (TIAMSA) Legal Group and a contributor to their blog, as well as the International Law Association (ILA) and the Lawyers’ Committee for Cultural Heritage Preservation (LCCHP).

[1] https://www.artmarketstudies.org/tiamsa-blog-creativity-is-human-but-technology-helps-to-sell-the-impact-of-ai-art-and-blockchain-on-the-art-market-by-claudia-s-quinones-vila/