Congressman Jerrold Nadler (D-NY) introduced a retooled version of his 2011 resale royalties bill yesterday that would give living visual artists or their heirs a cut of the profits when their work–paintings, drawings, photographs or sculptures–is resold through an auction house or online. The American Royalties Too (“ART”) Act would give these artists 5% of each secondary-market sale that exceeds $5,000, with a maximum allowable resale royalty of $35,000. The proposal does not directly impact galleries or private sales, and only auction houses grossing at least $1 million annually would be subject to the law.
Resale royalties for visual artists, often referred to internationally as droit de suite, are codified widely, especially in Europe. “More than 60 countries around the world have resale royalties provisions,” Dr. Thedore Feder, president of the Artists Rights Society in New York, told A.i.A. by phone today. “It’s about time American artists benefit too.” The ART Act’s proposed 5% resale royalty rate and its $35,000 cap are comparable to similar laws overseas, including those of the European Union.
Nadler enlisted two new co-sponsors in the Senate: Tammy Baldwin (D-Wisc.) and Ed Markey (D.-Mass.). The previous bill’s Senate sponsor, Herb Kohl (D-Wisc.), retired last year. “Just as our copyright laws extend to musicians and authors to encourage their artistic creativity, they should also apply to our visual artists,” Baldwin explained in a statement released yesterday. Artist Frank Stella added: “Composers, lyricists, actors, playwrights and screenwriters all deservedly receive royalties,” while “unfortunately, visual artists in the U.S. do not earn a penny in residual or resale payments.”
There’s “a lot of momentum” gathering around this bill and the ideas it concretizes, Feder told A.i.A. The U.S. Copyright Office revised its 20-year-old position opposing resale royalties in a report issued in December, citing broad international acceptance of the concept, among other factors. Feder added: “There’s also been a push in terms of public discussion and forums.”
California is the only state to have passed this type of legislation, though its 36-year-old Resale Royalties Act is currently under review. A federal court is set to rule on the statute’s constitutionality later this year. Oral arguments in the case, brought by artists Chuck Close and Laddie John Dill and the estate of Robert Graham, among others, are scheduled for Apr. 8. Sotheby’s, Christies and eBay have urged the appellate court to uphold a trial court decision that California’s 5% resale royalty impermissibly interferes with interstate commerce.
The ART Act incorporates several of the recommendations in the U.S. Copyright Office’s December report and differs in key ways from Nadler’s previous Equity for Visual Artists Act of 2011. In addition to the new $35,000 cap on allowable resale royalties for any single sale, it reduces the royalty to 5% from 7% and allocates the entire amount to the artist (less administrative expenses), whereas the former measure allocated 3.5% each to the artist and a museum fund. The new bill also applies to a broader range of auction houses and does not specifically exclude online auction sites. And lastly, the ART Act applies to works selling for $5,000 and up; its predecessor’s minimum was $10,000.
Sotheby’s issued a statement late yesterday, which A.i.A. received today via e-mail, asserting that it “shares [Nadler’s] goals of encouraging and supporting artists.” At the same time, Sotheby’s highlights the U.S. Copyright Office’s admonition to “approach this issue with some caution,” and alludes to “other ways . . . some of which may be more effective” to help artists.