Dear Agony,

I’ve been doing some background reading about what is useful to know for a professional practising visual artist and came across mention of the ‘resale royalty right’. As you are the ‘expert’ I thought I’d ask you to tell me what you know about it and whether it delivers value for Australian artists trying to make a living from their practice?

ArtRules, Balmain

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Dear ArtRules,

Thanks for that useful question. As it happens I do know quite a lot about this hard won right for Australian artists. To get it legislated in Australia actually took about 20 years of lobbying, especially by NAVA (the National Association for the Visual Arts). It came into force in June 2010 and since then has generated over $14 million for more than 2,700 artists.

So what is it exactly? It’s a 5% royalty payment for Australian artists which applies on certain commercial resales of their work after initial purchase (after 8 June 2010). The royalty is levied on original works of art if they are resold for $1000 or more, whether created by a single artist or as a collaboration between artists. It only applies to sales where an art market professional is involved like a gallery or museum, auction house, art dealer or agent, Indigenous art centre etc. It is not exercised in relation to the first transfer of ownership ie the original sale by the artist to the first purchaser. Nor does it apply to a private sale from one individual to another. Also it doesn’t apply when the artist gifts their work to a friend, relative or good cause or when an artwork is acquired through inheritance from the artist’s estate. So there are a lot of ifs.

However, the good thing is that the resale royalty recognises the ongoing interest that artists have in their work, a connection that lasts over their lifetime. When you think about the time and expertise required to create an art work, it is clear that for most artists, the initial sale price is not a fair measure of its real value. So the scheme was devised around collecting a percentage of the price every time a work is resold in the market. It has proved particularly valuable in generating income for Aboriginal and Torres Strait Islander artists whose work often rapidly gains in value as it changes hands between art centres, dealers and clients. The nearest equivalent for other creators is the Public Lending Right for authors who get paid a royalty each time their book is borrowed from a library (maybe more about that another time).

The resale royalty applies to a broad spectrum of artworks including artists’ books, batiks, carvings, ceramics, collages, digital artworks, drawings, engravings, fine art jewellery, glassware, installations, lithographs, multimedia artworks, paintings, photographs, pictures, prints, sculptures, tapestries, video artworks and weavings. The artwork must have been created by the artist or produced under the authority of the artist. A limited edition reproduction, such as a numbered print, is covered if its production was overseen by the artist. Mass-produced items, such as posters or souvenirs, are excluded, as are manuscripts, architectural drawings and plans and circuit layouts. Also it does not apply to artworks if the artist has been dead for more than 70 years.

The latest positive news it that from 31 March this year, the scheme extends to artworks traded in 17 other countries that have similar schemes. They are Austria, Belgium, the Czech Republic, Denmark, Finland, France, Germany, Hungary, Ireland, Italy, Latvia, the Netherlands, Norway, Portugal, Spain, Sweden and the United Kingdom.

So who has to pay the resale royalty? Usually it’s the seller, the buyer and the art market professional involved in the commercial resale of the artwork who are jointly liable to pay the royalty.

In Australia, the scheme is managed by Copyright Agency (CAL) and all commercial resales of artworks must be reported to them in writing within 90 days of the date of the commercial resale. It must include sufficient information for CAL to calculate the resale royalty payable and identify who is liable to pay it. CAL is a non-profit organisation that has been managing rights for artists, writers and publishers and other creators for 50 years.

To participate in the scheme, you need to register with Copyright Agency.

Registration costs you nothing, but you have to provide certain information (such as your nationality), and guarantee that the information is correct.

Most royalties are between $50 and $500 so unless your work is resold many times over, you will not be making a fortune from it, but every bit helps. Does it deliver value? Well $14 million is not nothing!