HMRC have announced changes to the UK bonded warehousing regime. The purpose of the bonded warehousing regime (the technical phrase is “Customs Warehousing”) is to… Read More »Changes to the UK Bonded Warehousing Regime
The payment of bribes to foreign customs officials to facilitate the importation of goods in a foreign country has recently been in the spotlight after the Ralph Lauren Corporation made facilitation payments to Argentinian customs officials in connection with the importation of goods into the country.
On 22 April 2013, it was reported that the Ralph Lauren Corporation (a US company) would pay over USD 1.6 million to US authorities as part of a settlement for violations of the Foreign Corrupt Practices Act. This followed the discovery that the Argentinian subsidiary of the corporation paid bribes and made gifts to Argentinian customs officials between 2005 and 2009, to ensure that goods were imported into the country without inspection and without necessary paperwork. The corporation discovered the misconduct during an internal review and promptly reported it to the regulators. As a result of its co-operation with the authorities, the Ralph Lauren Corporation has not been charged with violations of the Foreign Corrupt Practices Read More »Crack down on Bribery: a warning to galleries and dealers
The Customs Information Paper introducing changes to the temporary removal of goods from Customs Warehousing (see the article on this blog on Changes to the UK Bonded Warehousing Regime) refers to a previous Customs Information Paper (Ref: (10) 44 effective 18 June 2010). The Annex to that Customs Information Paper seeks to clarify certain procedures for the importation of works of art and antiques for display at galleries, fairs and exhibitions.
The second paragraph of the Annex reads: “Some art works currently being imported into the UK are described as “art installations” or “light installations”. These typically include some form of audio visual presentations or light display and current practice was to classify these installations according to their constituent parts and not as “art” in Chapter 97 of the Tariff”. This is a reference to HMRC’s inept argument that a video installation (e.g. by artist Bill Viola) or a light installation (e.g. by artist Dan Flavin) cannot be imported in the UK as an artwork simply because it is disassembled and crated for shipping. The fact that these art pieces are imported packed in boxes means, so argues HMRC, that they must be taxed as light bulbs, video screens and electric wires, because this is how these artworks appear to HMRC officials when they are wheeled through Customs. The sub-text is that HMRC officials are so devoid of natural intelligence that they cannot make the difference between an artwork by a world-famous artist (even when it is accompanied by a certificate of authenticity signed by the artist) and a bunch of wires. Tax should be levied, HMRC go on to say, at the rate applied to electrical and video apparatus, i.e. currently 20% instead of 5% for works of art. Customs duty should be levied too, as it applies to electrical and video equipment, not to works of art. This might have been mildly ridiculous, had HMRC not also argued that the higher rate of tax and duty should be applied not on the retail value of the electrical or video equipment (a few hundred pounds) but on the value declared by the importer being the value of an artwork by the artist (typically several hundred thousand pounds).Read More »The Importation of Video and Light Installations
You may regard yourself as an art collector. Occasionally you may sell an artwork or two. You expect to be taxed on those sales as… Read More »The Fine Line between Collecting and Dealing
Richard Prince has won his appeal against a first instance ruling in the US that 30 of his works infringed copyright in photographs by Patrick… Read More »Appropriation art found not to infringe copyright
The London Upper Tax Tribunal accepts that an old master painting is a wasting asset, thereby escaping capital gains tax upon its sale. In November… Read More »Is an old master painting a wasting asset?
New legislation is introduced in New York requiring galleries to hold sale proceeds owed to artists on a separate account. Galleries do not always segregate… Read More »Segregating sale proceeds owed to artists
French Court rules that the resale right must be borne by the seller. In December 2012, the French Court of Appeal held that where the… Read More »Artist’s resale right: the economic burden