7 December 2022

Sotheby’s and Forsters - An Owner's Guide to Art - Part 2

Buying and owning art can be one of life's greatest joys. But while the drive to own art is often fuelled by an emotional connection with a piece or the prospect of holding a lucrative investment, it is important for buyers and owners of art to keep their wits about them, from both a legal and practical perspective.

Felix Hale (Sotheby's Tax, Heritage and UK Museums Team) and Jo Thompson (Forsters LLP's Art Group) aim to point those wanting to buy, sell, and hold works of art in the right direction. This five-part mini-series will cover the following key areas:

  1. Acquiring and selling art
  2. Transporting art
  3. Maintaining your collection
  4. Passing on your art collection to the next generation
  5. Art and philanthropy

Part 2 - Transporting art

If you wish to transfer artwork from the UK to another jurisdiction, you will need to comply with any applicable export reporting obligations and tax payments under UK rules and any import payment or reporting obligations in the jurisdiction of entry. Similarly, if you wish to bring artwork into the UK, you will likely have an exposure to UK VAT. This article outlines the applicable restrictions and rules in the UK and aims to provide practical tips for the transportation process.

Export considerations


Since the Second World War, the UK has exercised various export controls for works of art and other historical objects.

Broadly, where a work has been in the UK for less than 50 years one applies for an Open General Export Licence (Objects of Cultural Interest) which permits permanent export to any destination (save for embargoed ones) of works that do not exceed the age and value thresholds outlined below. Works of art that have been in the UK for more than 50 years and that meet a monetary value threshold (which can be fairly modest) require an individual export licence in order to be exported from the UK.

The process of applying for an export licence is as follows. You make an application (which contains details of the full provenance and ownership history of the artwork) to Arts Council England, who refer the work to an Expert Advisor. If the Expert Advisor objects to the export of the artwork, then the case is considered by the Reviewing Committee on the Export of Works of Art (RCEWA), who determine whether the work is a ‘national treasure’ on the basis that its departure from the UK will be a misfortune on one or more of the following three grounds (called the ‘Waverley Criteria’):

  1. The work is closely connected to UK history and national life;
  2. The work is of outstanding aesthetic importance; or
  3. The work is of outstanding significance for the study of some particular branch of art, learning or history.

If the committee finds that the object meets one of the above criteria, a deferral period (called the ‘first deferral period’) is imposed to allow a UK purchaser (almost always a UK museum or gallery) a chance to express a serious intention to match the sale price (or an agreed value if no sale has taken place) and acquire the work of art. If a UK purchaser expresses a serious interest to acquire the work during this first deferral period, another deferral period (the ‘second deferral period) is imposed, giving the acquiring institution a chance to raise the funds necessary to purchase the work.

The export reviewing process can take up to a year to complete. Cases are heard by the reviewing committee normally within two or three months following the receipt of the objection to the export. The first deferral period typically runs for a period of between two and four months. The second deferral period typically lasts a maximum of six months, although if an object is exceptionally valuable the committee has discretion to impose an even longer deferral period to allow a UK purchaser to fundraise.

If no UK purchaser shows a serious intention to purchase a work by the end of the first deferral period however, the export licence is granted at that point. Similarly, if the potential UK purchaser fails to raise the necessary funds by the end of the second deferral period, the export licence is granted.

Often the export licencing process occurs when a work of art is sold in the UK and acquired by a foreign buyer who then wants to export their object. If the seller remains the owner (because the buyer hasn’t yet paid) the ‘matching offer price’ is the amount the seller would have received had the work been sold to the foreign buyer. If the buyer is the owner (because they have paid for the item) the matching offer amount is the amount they paid for it. If you are a buyer who intends on exporting a work that has been in the UK for over 50 years, you may wish to defer payment until an export licence has been granted. This is something that would need to be agreed with Sotheby’s prior to the sale.

The system in place tries to strike a balance between enabling a thriving art market, where buyers are able to purchase with confidence, and protecting the UK national heritage. Only a small number of items each year are referred to the Review Committee, and in even fewer cases are funds-raised successfully. Sotheby’s frequently represents clients whose objects have been referred to the Committee.

Currency fluctuations

Although the UK export licence applications are made in GBP, a foreign buyer may well have paid for the artwork in another currency. The export licence process can be lengthy, and currency fluctuations during that time can be a real concern to buyers. Since 2021, buyers who have paid in non-Sterling currencies can choose for the ‘matching offer price’ to be paid with the currency conversion as at one of the following three dates:

  1. The date of the original sale;
  2. The date of the export licence application; or
  3. The date of the Reviewing Committee hearing.

Import considerations

If you wish to bring art into the UK, the import will generally be subject to a VAT charge of 5%. In order to benefit from this lower rate of VAT, the art will need to meet certain conditions and have the correct commodity code. There is generally no customs duty charged on imports of mainstream categories of art, for example, original oil paintings or pencil drawings.

Make sure that you have complied with any exporting obligations in the jurisdiction from which the artwork is being imported!

Practical considerations

We strongly recommend that your work is properly insured from the moment it is taken off the wall and placed onto a new one. In particular, we would recommend using a specialist fine art shipper for fragile pieces.

Sotheby’s can advise on shipping and arrange expert delivery of your works of art worldwide when either importing goods before a sale or arranging shipping and exporting on completion of a sale. Sotheby’s would be happy to speak to you about moving your art safely.

For any guidance on the import or export of artwork, please contact Forsters or Sotheby's. In the next part of this mini-series, we will be looking at practical tips on how to maintain, insure and keep track of your artwork.

Please note that this briefing offers general guidance on the transportation of artwork. The circumstances of each case vary, and this note should not be relied upon in place of specific legal advice.

Felix Hale at Sothebys

Felix Hale is a Deputy Director in Sotheby’s Tax, Heritage & UK Museums department. He works with some of the most significant estates and collections in the UK, working with clients on valuations, sales, offers in lieu of tax, and claims for Conditional Exemption. He is a member of PAIAM (Professional Advisors to the International Art Market, Vice-Chair of the next generation board) and a member of STEP (Society of Trust and Estate Practitioners).

If you would like to contact Felix, you can email him on [email protected].

Jo Thompson from Forsters

Jo Thompson is an associate in Forsters’ Private Client team and part of Forsters’ Art and Cultural Property Group. She acts for UK and international clients, advising high net worth individuals, families, landed estates, family offices, trustees and beneficiaries on a range of estate, trust and tax planning matters. Her work includes succession planning for a number of living artists and advising on heritage property matters. She also acts for high net worth individuals and trustees holding significant art collections.

If you would like to contact Jo, you can email her on [email protected].

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