As a ‘No Deal’ Brexit Looms, the Art World Prepares for the Fallout

https://www.nytimes.com/2019/02/20/arts/art-no-deal-brexit.html

Version 0 of 1.

LONDON — Roads gridlocked with trucks. Empty supermarket shelves. An economy thrown into paralysis.

The images seem extreme, but as the possibility looms that Britain might leave the European Union on March 29 without an agreement, businesses are preparing for the worst. The art trade is one of them.

Dealers, auctioneers, artists and their supporting services are all trying to weigh up the challenges of the withdrawal, known as Brexit, including the tariffs to be paid and saved, and the opportunities lost and gained.

“If there is no deal, it means all shipments between Britain and the E.U. will be subject to customs clearance,” said Victor Khureya, executive operations director at Gander & White, a specialist fine-art shipping company, based in London.

The London-based artist Eva Rothschild is representing Ireland at this year’s Venice Biennale. Her British gallery, Modern Art, will ship her works to Italy well ahead of the leave date of March 29. “Once Brexit has happened, there will be no guarantee that the export of artworks will not be subject to intense chaos and inevitable delays,” said Stuart Shave, the gallery’s director.

Tornabuoni Art, a high-end dealership with galleries in six locations in Britain, France and Italy, now plans to close its current London exhibition of 20th-century abstracts by Alberto Burri and Lucio Fontana on March 9, three weeks earlier than scheduled.

The 40 works in the show have a value of about 70 million euros, or $79 million, which would attract a tax bill of €7 million if shipped back to Italy after Britain drops out of the European Union’s free trade zone, because Italy levies 10 percent on artworks imported from outside the bloc.

Ursula Casamonti, director of Tornabuoni Art’s British branch, said, “It will be a long process, but if it’s really complicated and a hard situation with imports, I will close the London gallery.”

If the withdrawal agreement between London and the European Union is ratified by British lawmakers, existing trading arrangements will remain in place during a transition period lasting until the end of 2020, when a new, as yet undecided customs framework will come into force.

Although Britain is no longer the global force it was in industries such as steel production or ship building, it is still a big fish in the relatively small pond of the international art market. In 2017, the country was the third-largest art trading hub, with total sales of $12.9 billion, according to a report published last March by Art Basel and UBS. The United States had the largest art market, at $26.6 billion, followed by China, with $13.2 billion. The figure for Britain represented 62 percent of sales in the European Union, with France the next biggest in the bloc, at 22 percent.

In a recent article, the author of that report, Clare McAndrew, wrote that Brexit was a “golden opportunity” for the art market in Britain. At 5 percent, its import tax on artworks is the lowest in the European Union. If, after Brexit, Britain were to reduce or remove this tax, it could “attract global sales, effectively bypassing Europe altogether,” Ms. McAndrew said.

That prospect alarms art dealers on the Continent. This month, the French trade federation for the art market wrote an open letter to the French government calling for changes to counter the competitive threat of a deregulated British art trade. “What we fear is a liberalization of the U.K. market, with relaxation of the financial burdens and constraints,” Mathias Ary Jan, president of the Syndicat National des Antiquaires, one of 10 association heads who signed the letter, said in an email.

With buyers in the European Union currently accounting for less than 20 percent of Christie’s sales in London, the auction house, like its rival Sotheby’s, said it had no plans to reconfigure its European operations. “We still think London is the best marketplace,” said Dirk Boll, president of Christie’s Europe, Middle East, Russia and India. “And not having any import tax would help.”

For the moment, sellers still express confidence in London as a venue to auction high-value art. Sales of Impressionist and modern art at Christie’s later this month are estimated to raise at least 207 million pounds, or about $270 million, the highest valuation ever placed on an “Imps and mods” season at the company’s London salesroom.

But while analysts and auctioneers might see the advantages of Brexit, others in the art world are appalled by the prospect.

“The feeling is one of great sadness,” said Enrico David, one of three artists who will represent Italy in this year’s Venice Biennale. On Monday, Mr. David took his “Life in the U.K. Test” as part of an application for British citizenship, having moved to London in 1986.

“I was part of the first European generation that traveled around. We felt we were breaking barriers. Then the Berlin Wall came down, and we were part of a communal evolution and joining project,” said Mr. David. But, he added, artists were better prepared for the uncertainty of Brexit “because of the sense of uncertainty that creativity involves.”

The practicalities of Brexit will give everyone in the art world plenty to think about. In the event of no deal, Britain-based dealers who operate in the European Union will immediately require customs clearances from two different authorities. This in turn will require specialist software and financial guarantees, according to Mr. Khureya of the shippers Gander & White. “There will be a lot of extra administration, costs and delays,” he said. He added that smaller dealerships could find this particularly burdensome.

But some British traders seem unaware of the shock a no-deal Brexit could deliver to the world’s fifth-biggest economy. Andrew Legere, owner of Lantiques, a dealership based in Petworth, southern England, has been buying and selling old French furniture for more than 25 years. “I used to buy a lot of my stock in France, but now I have an established network of British dealers who buy in France for me. I’m anticipating that this should adequately sidestep the obstacle of Brexit,” said Mr. Legere.

But wasn’t he aware that from March 29 it will be difficult, if not impossible, for dealers to drive a van over to France and drive it back filled with antiques?

“I didn’t know that,” Mr. Legere said. “I’ll have to ring round my suppliers to see what they say.”