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The Art Newspaper, along with a number of other sources, reports yesterday (16 december) that: US Copyright Office reverses its position on droit de suite in the US.

However, a reading of the actual report suggests that claims that the U.S. Copyright Office has unambiguously endorsed legislated ARR as the "best" policy option are what Mark Twain once called "greatly exaggerated” claims. In fact the report is not a ringing endorsement of the legislated ARR option as the best or only option, for the U.S. Congress to consider, sometime next year.

While the reports conclusions do find that on available evidence, adoption of a resale royalty right "would not cause substantial harm to the U.S. art market ", the report then immediately goes on to state that

"As to the second issue-the likely benefit to U.S. artists – the evidence is less obvious.'

"Accordingly, while the Copyright Office finds no significant legal or policy impediments to adoption of a U.S. resale royalty, and indeed supports consideration of a resale royalty right as one option to address the historic imbalance in the treatment of visual artists, it is less persuaded that such legislation represents the best or only solution."[emphasis mine]

Under the heading Benefits to Artists the report acknowledges that:

"On the whole, it does appear that “a minority of artists reap the lion’s share of financial rewards,” and that the class of beneficiaries is skewed toward higher-income artists.438 In the 1992 Report, the Office cite “evidence that as few as one percent of artists will qualify for the royalty,”439 and opponents point to a subsequent study finding that “only approximately 0.15 percent of U.S. artists have works that have resold for $1,000 or more.”

It is hardly surprising that the Copyright Office is, less persuaded that ARR legislation "represents the best or only solution."
And the following is from the conclusion of the Copyright Office's analysis of the legislated ARR option:

".....It remains unclear, however, whether these benefits would offset the potential countervailing costs cited by opponents, such as enforcement and administrative burdens, among others.

As such, the Copyright Office would need greater information – for example, survey information from a significant nucleus of American artists, their heirs, or estates – in order to recommend a statutory resale royalty as the only solution to the burdens faced by visual artists. We note, however, that at the time of this report’s publication, at least two resale royalty jurisdictions – the EU and Australia – are in the process of completing updated analyses of the effectiveness of their own resale royalty schemes.449 Congress may wish to forego legislative action pending the release of those studies, which may fill in some of the information gaps noted here.

At the same time, the recent and ongoing evolution of the visual art market may well counsel against a permanent legislative solution. As the market expands, both in popular appeal and in the creation of art forms that are more suitable to production in a meaningful number of copies or multiples, more artists may see benefits under the existing law. Still, Congress could pursue other safeguards, including voluntary initiatives and/or best practices.450 Alternatively, Congress could revisit one or more of the legislative proposals raised in the 1992 Report. We briefly consider some of these options below." (emphasis mine)

The report then goes on to consider alternative options such as voluntary arrangements. After outlining a number of successful US and Canadian initiatives in the area of voluntary schemes, the report acknowledges that:

''Of course, voluntary agreements remain just that."

And the report then goes on to suggest that:

"…some level of congressional involvement may be necessary for these[voluntary] negotiations to achieve meaningful results. The Office notes that the House Judiciary Committee has recently expressed an interest in examining the role of voluntary agreements in the intellectual property system generally, as well as the federal government’s role in furthering and recognizing such agreements.467 As part of that review, Congress may wish to specifically consider the ways in which it could facilitate agreements among stakeholders in the art market, or even regulate certain standards or other aspects of them..."

It is clear that reports that the U.S. Copyright Office has reversed its position and endorsed legislated Artist Resale Royalties as the best or only policy option for Congress to consider are, 'greatly exaggerated'.

Post scriptum

The ARR involves a group of collection societies seeking what is effectively a U.S 'class representative status', that would be binding on all U.S artists, into the foreseeable future. Given Justice Chins recent ruling on the Authors Guild's 'class representative status', I do wonder about the legality of the claim of compulsory representative status that is implicit in the collection societies proposal.

It is also a fact that the EU does not recognise any non european ARR schemes as valid "fully functioning schemes" at all.

The link for the Report is http://www.copyright.gov/docs/resaleroyalty/usco-resaleroyalty.pdf

About the Author

John R Walker

John R Walker

John R Walker has been exhibiting for more than 30 years. His artworks can be found in many of Australia's major public and private collections including: the ACT Legislative Assembly, Art Gallery of...