All questions

Art transactions

i Private sales and auctions

Private sales of artwork are not subject to any specific body of law and are governed by the general rules governing sale contracts under French law. The general legal warranties granted by the seller to the buyer thus apply. It should be noted that auction houses were originally forbidden to conduct private sales. The authorisation for auction houses to conduct private sales was first limited to unsold lots at auction36 and then, from 2011,37 to any consigned goods, provided that the auction house has duly informed the client of the possibility of resorting to auction.38 Since the introduction of the new law in 2022, auction houses no longer have to draw up the minutes of private sales.39

In private sales involving a professional seller and concluded remotely (such as online sales) or off the professional seller's premises, the buyer (if they are not a professional) has the right to cancel the sale within a period of 14 working days. The consumer's right of withdrawal does not apply to auction sales (including phone or online bids). It also does not apply to private sales concluded in fairs and shows.

In contrast to private sales, auction sales are strictly regulated in France. The law defines what types of goods may be sold at auction, who may sell at auction, who may conduct the auctions and the modalities of the auction sales. Online auctions are subject to the same rules.40 A reform of auction sales was adopted in 2022 to modernise the art market.41

All auction houses must declare their activity to the regulatory authority for auction sales, which has just incurred important changes, particularly in terms of representation and membership. The former Voluntary Sales Council has been renamed the Council of Auction Houses.42 This authority has disciplinary powers that have been newly entrusted to two distinct bodies: a civil judge exercising the role of government commissioner in charge of investigating suspected offences;43 and a sanctions committee that renders decisions.44 Two new possible sanctions can be rendered by the disciplinary body of the Council of Auction Houses: a fine of €90,000 for a repeat offence (of a similar nature to the first offence) and the publication of the offence in newspapers or media, as determined by the committee.45 Furthermore, auctioneers who legally represent an auction house can now be convicted of the same offence as the legal entity they represent.

One specific warranty granted by professional sellers to consumers in art market transactions – whether private or at auction – should be mentioned. In art market transactions, the professional seller warrants to the consumer that the description of the artwork put up for sale is accurate.46 For instance, the title or denomination of a work directly followed by a reference to a historical period, century or era warrants to the buyer that the work or item was actually produced during the period of reference; the use of the term 'attributed to' followed by the artist's name indicates that the work or the object was executed during the period of production of the artist mentioned and that serious assumptions indicate that this artist is the likely author; the use of the term 'school of' followed by the artist's name warrants that the author of the work has been the pupil of the master cited or has been known to have been influenced or have benefited from their technique.

ii Art loans

Art loans involving French public institutions – whether as lenders47 or borrowers48 – are governed by a set of detailed rules in the French Heritage Code. These rules notably provide an obligation for a contract to be signed.49 A commission oversees the lending or borrowing process and renders opinions on the condition of the artwork and the safety guarantees. Loans of artwork to public museums must be granted for free. Insurance may be requested and it is specified that a guarantee50 may be granted by the French state to national public institutions for the liability they may incur towards lenders of artwork for temporary exhibitions when the total insurance value of works of art that do not belong to the state exceeds a certain amount.51

Works of art that are loaned to a public museum in France may be protected against seizure for the period of the loan if the lender is a foreign country, public body or cultural institution, in which case a request must be filed with the Ministry of Culture to obtain an anti-seizure order made jointly by the Minister of Culture and the Minister of Foreign Affairs.52 The request must describe in detail the art, antiques or collectibles for which the anti-seizure order is requested and provide pictures of the items.

This process is not applicable to foreign private individuals or foreign private for-profit organisations. For instance, the heirs of a businessman wrongfully dispossessed during the Nazi occupation in France took advantage of the fact that a Pissaro painting, La Cueillette des pois, was on loan to the Marmottan Monet Museum in Paris to have it seized to file a Nazi restitution claim before the French courts for its return. The lenders, a couple of US collectors, could not benefit from the immunity from seizure regime.

Other art loans not involving public institutions are subject to the general rules of the Civil Code. The disputes that arise most regularly concern lack of safety measures taken by the borrowing party. For instance, an association that had organised a temporary exhibition of photographs by Joan Fontcuberta that were stolen during the exhibition was found liable for having insufficiently protected the premises and had to pay damages to the artist.53

In a 2019 case heard by the Paris Court of Appeal,54 the owners of a bronze cast attributed to Brancusi consigned the work to an expert to confirm the authenticity of the work and monitor its sale. The expert had signed an agreement with a Belgian institution for the loan of the work. However, the owners of the work, who had recovered their property in the meantime, refused to lend it. The expert filed a summary claim against the owners to compel them to proceed with the loan (the expert notably claimed that his reputation and the extent of his consideration were undermined by the owners' attitude). The Court rejected the expert's claim on the grounds that it had been agreed between all parties that the work would only be loaned if its authenticity were definitely asserted by art historians, and there still remained some uncertainty on this count at the date of the loan.

iii Cross-border transactions

Works of art are subject to export controls outside and inside the European Union. For the protection of national treasures, Article 36 of the Treaty on the Functioning of the European Union provides for an exception to the prohibition between Member States of customs duties on imports and exports on goods.55

Items belonging to public collections and French museum collections, as well as items classified as historical monuments, are automatically considered national treasures under French law. There is also a secondary category of goods that may be considered national treasures if they are 'of major interest for national heritage from a historical, artistic or archaeological point of view'.56 The permanent export of national treasures is forbidden.57

The temporary or permanent export of cultural goods from the secondary category is contingent upon the issuance of an export certificate (and an export licence if the item is exported outside the EU) if the items fall within the 15 categories listed by the French Heritage Code.58 The major interest for national heritage is defined in this list according to two criteria: age and value. The age and value thresholds have been recently raised59 in a general trend towards more leniency of the French authorities towards exporting cultural goods. For instance, the following cultural goods are subject to the prior issuance of an export certificate: sculptures that are more than 50 years old and worth more than €100,000; paintings that are more than 50 years old and worth more than €300,000; photographs that are more than 50 years old and worth more than €25,000; and archaeological objects that are more than 100 years old and worth more than €3,000.

The procedure for the issuance of an export certificate is designed to give time to the French administration to review the cultural value of the items and decide whether to classify the goods as a national treasure (i.e., to ensure that the item remains permanently on French territory). For instance, the French state acquired a pair of Fragonard paintings after having refused their export certificate in 2017. The acquisition was made possible after a public call for corporate sponsorship of cultural goods acquisitions published by the Ministry of Culture on 27 November 2020, informing companies subject to corporate income tax of the potential tax deduction of up to 90 per cent of payments made for sponsoring, or financing acquisitions of, cultural goods, up to a limit of 50 per cent of the tax due for the fiscal year in question.60

Upon request from the Louvre, the French state recently refused to grant an export certificate to the Panier de Fraises by Chardin, auctioned for the record-breaking amount of €24.3 million by Artcurial on 23 March 2022, hoping to raise the sufficient funds to acquire the paintings for French public collections.61

The owner of goods intended for export must file an application for an export certificate, including a photograph of the item, in person or through an agent, with the Ministry of Culture. The Ministry of Culture has four months to review the application. At the end of this four-month period, the Minister must issue or refuse the certificate.

When granted, the certificate permanently attests that the item is not a national treasure. This certification is final (except for items less than 100 years old).

Upon refusal of an export certificate, a 30-month period commences, during which the cultural goods may not leave French territory. The applicant cannot claim any compensation for the refusal of the export certificate (but the applicant can challenge the decision through an administrative tribunal). Upon the expiry of this 30-month period, a new application for an export certificate cannot be denied unless the cultural goods have either been classified as a historic monument or the state has made an offer to purchase them. If the owner refuses a purchase offer from the states, the refusal to issue an export certificate is renewed with no compensation (i.e., the item remains blocked on French territory).

Penalties for failing to apply for an export certificate or failure to comply with refusal of export authorisation are the same: a fine of €450,000, three years' imprisonment and confiscation of the item.

Import of cultural goods is, in principle, free of any controls. However, following a July 2016 law, some controls have been implemented on the import of cultural property of archaeological, prehistoric, historical, literary, artistic or scientific interest from non-Member States of the EU that are party to the 1970 United Nations Educational, Scientific and Cultural Organization Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property. The import of these goods is now subject to a requirement for a certificate or equivalent document authorising the export from the exporting state when this is provided for by the exporting state's legislation. In the absence of this certificate, the import will be forbidden.62

The import of cultural goods that have left the territory of a state unlawfully is also forbidden.63 Cultural goods that have been seized at customs because they left the territory of a non-Member State of the EU may be placed in a museum accredited by the French state for the purpose of their conservation and presentation to the public while the research of the legitimate owner by the competent authorities is ongoing.

Current French tax legislation has not been modified, as the French government is protective of the art market, especially in the present circumstances. French law derives mainly from EU regulations and case law.

Regarding customs duties, tax formalities and transport of cultural goods from or to the UK, art dealers and art transport companies admit to having some difficulties in transporting art from European countries to the UK and vice versa, since the UK ended its transition period and completed its exit from the EU. Paris and other European markets are now favoured, to the detriment of London, for substantial auction sales, in consideration of the quality of local auction houses and the additional costs, paperwork and time resulting from Brexit.

iv Art finance

Art market professionals (auction houses, art dealers, gallerists, etc.) are subject to anti-money laundering obligations. In particular, art market professionals must carry out anti-money laundering checks, such as the identity, domicile and profession of their clients, and gather information on all relevant elements of the client's estate and the provenance of the sums involved. Art market professionals must declare to TRACFIN, the French anti-money laundering unit, any sums that they suspect may be the product of a criminal offence punishable by a prison sentence of more than one year or that may be connected to the financing of terrorism.

In recent years, and particularly since 2016,64 the French authorities have strengthened anti-money laundering measures considerably, assisting art market professionals to combat the illicit traffic of cultural goods and the financing of terrorism. Guidelines for persons habitually engaged in trade in antiques and works of art were adopted in May 2019.65