WIPOD – Page Points: Transcript of Episode 19

Intellectual Property and Art Collecting

This conversation explores the evolution of art collecting, digital technologies in the art market, and legal frameworks across multiple jurisdictions with co-editors Bruno Boesch and Massimo Sterpi.

Bruno Boesch
Now you have worldwide a younger demographics, to use that term, of people who are interested in a broad range of art. If you look at the websites and the advertisements of the big auction houses, you can see that all sorts of collectibles step in. Watches, sneakers, anything that is unique in a way, will attract this young generation. They don't draw the same lines between the sectors of the art market.

Lise McLeod
Younger collectors (defined as individuals aged 36 or younger) are taking an online-first approach to discovering and collecting art. Some 82% of this demographic have reportedly purchased art online. Art appreciation is evolving as our next conversation highlights.

Hello, Page Points listeners. Today we have joining us the co-editors of the book entitled 'The Art Collecting Legal Handbook', and its in its third edition. We have joining us Bruno Boesch and Massimo Sterpi. I'd like to say welcome to you both to the podcast.

Bruno Boesch
Thank you.

Massimo Sterpi
Thank you.

Lise McLeod
Let's begin our conversation by a definition of what is meant by 'art' to you? And is it limited to just physical works, or do you also address digital technologies as well?

Massimo Sterpi
Actually, we started from a wide definition of art that has to cover different jurisdictions. And these can, in certain countries, encompass a list of items, and in others, it can just be a very open definition. So art is certainly visual arts, and let's say, this is, as the title says, a collector's book.

So clearly, we refer to art that can be collected, not necessarily physical, because as our most recent edition shows, art has been more and more, let's say, dematerialized. And in recent years, there have been many examples of artwork that have no physical, let's say, embodiment, but nevertheless, they were collectible.

So art that can be collected is probably the focus of the book.

Bruno Boesch
Could I perhaps make two comments to that? I like very much the definition of art, saying that art is what you call art, and that's really what we deal with in this book. If you look at the list of jurisdictions, some jurisdictions are more particularly concerned with archaeology. I would say it's cultural property in the broad sense that the book deals with.

Lise McLeod
You mention jurisdictions. Could you outline how many are included?

Massimo Sterpi
It's between 25 and 29 across the different editions of the book.

Bruno Boesch
And here again, if I may, one comment regarding these many jurisdictions. There's a great variety of jurisdictions. We also paid attention to the fact that, yes, we provide information in response to a set of questions where we follow the work from the inception to the eventual gifting, for instance, or even disappearance.

But we did that paying attention to the fact that in these countries, cultural property is dealt with not only in different ways, but with different sensitivities. The concept of cultural property in a trade country, in Holland, in Switzerland, is very different from what it is in Italy, Greece, Egypt, or Iran. And we were trying and we achieved to get that through the voice of the contributor. So we did heavy editing to make sense of it, but we tried to keep the original voice of the country.

Massimo Sterpi
Yeah, exactly what Bruno said is very important. We covered with a lot of attention both what are called source countries and what are called market countries, because they have completely different needs, completely different attitude, and many times completely different rules, because for the market country, make it as easy as possible to put in and out artwork, whereas the source country are normally very strict in allowing certain pieces to go abroad and at that point, even strict in allowing things to go in. So yeah, we had a variety of attitude that is however perfectly covered by the breadth of the number of countries that we were able to cover in this book.

Bruno Boesch
Massimo is, I think, putting the finger on something which I find important. Art and cultural property for a long time has been almost the last bastion, the last soldier standing for trade. Art has moved enormously, more than anything else, and it was the last field in which barriers were rising. Today, it's fair to say that some barriers are rising.

And you might say understandably because countries are increasingly concerned about the meaning of their heritage for their identity, so they protect it.

Massimo Sterpi
You notice that in the last years there has been this big movement for decolonization and return of pieces, sometime or many times even beyond what the law said, because this emergence of a new sensibility created a lot of issues because demand were not supported by the existing law. Same happened before with looted works that generated a number of solutions that were not within the existing law, but like innovative solutions and international treaties and things or ways to create a new international customary rule.

That is beyond, by the way, what emerges. This is something that I think is important to share with you, that a book like ours, which is the first of its kind, because there were comparative books on certain aspects of art, to make an example about the taxation of art, but there was no book that was able to cover so many aspects about art in so many countries.

And by the way, our book can become a point of reference also to understand whether international customary rules are being created because you can see if certain rules repeat themselves in several countries and they can be evidence of an existing international de facto convention or a customary rule, which is very important. I think that's an interesting contribution that we made to the field.

Bruno Boesch
There's indeed a growing body of understanding regarding how cultural property is dealt with, both between institutions in different countries and between private persons. May I briefly come back, because we may not get a chance to do that later on, on the matter of repatriation or restitution and technology?

Yesterday I attended a fascinating conference by the International Catalogue Resonné Association where we talked about the Digital Benin project, which is a very advanced project about recording the various items that were plundered at the end of the 19th century. And we can see there how people from around the world congregate to develop up-to-date workable practices. You should really have a look at their website, Digital Benin. It's one of the most advanced websites in that field and it reflects a level of understanding which just runs ahead of the law.

Lise McLeod
What would you say is the most important change affecting the art market that has happened since the last edition of this book?

Massimo Sterpi
I think it was certainly the impact of technology on both the kind of works that were being traded, the emergence of, not the emergence of digital art per se, because digital art has been around for decades, but the emergence of digital art as a sellable product, as a market product that in combination with the NFT, even if it was a sort of a big peak followed by a big fall, almost a fad, but certainly something remained. That's about the type of work being traded.

But on the other hand, it's certainly a different world because nowadays people tend to buy art remotely, which was practically unheard of or very, very rare, very limited before COVID.

Now people are used to check works remotely, to see them from any angle. Galleries can show works remotely. So there is a different attitude where remoteness is part of the game. And not necessarily you have to have the work in front of you before buying it. So that's a big difference.

Also, escrow systems that are created through digital platforms like remote bidding and all sorts of things, including other elements impacting on the trade, like tokenization of artwork so that you can buy a digital token that represents a quota of the value of the work. So the works are more or less the same they used to be.

Nowadays, the last probably big wave is the impact of artificial intelligence and the creation of many, many works where artificial intelligence has a role. And that is still in a very gray area, is still a bit undecided whether works created by or with the strong help of AI may be protected by copyright. And of course, this has an impact on their value, because if they are freely replicable, clearly they have less value. If there is a copyright that is recognized, at least to the human that mostly contributed to their creation, they are sort of legal monopolies and that increase their value.

Bruno Boesch
Massimo, don't you think it would be right to distinguish, as far as technology and the impact of technology is concerned, the impact in the art market and the impact in the art world? I think rightly you say that the art market has been heavily impacted.

We have data banks on prices today that did not exist only a few years ago. These tools have allowed people to trade remotely. Auction houses, galleries use platforms for the sale of works of art remotely and they work extremely well. Though when you look at the overall figures, it's still only a fraction of the volume, the turnover of the art market.

But there is a change of demographics, which of course impacts the habits. And young people don't have the same issues with working remotely. And you can witness that only recently, I remember attending a Christie's sale here in London, when you could see that impact.

How did you see it? Because the auctioneer was clearly dealing with the room in the traditional way, the people on the phone, which there are more and more of them on the phones on the side of the room. And the third audience was the people online. And if it's senior enough, the auctioneer would be perfectly comfortable even addressing openly in front of the room the people online and saying, "You in Illinois, 10,000 against you" and then moving towards the room, et cetera. So, the remote dealing is moving actively. But I think more significantly even, the technology is impacting the art world and not just the art market. We see that in immersive exhibitions.

We have not only do we have all of this happening in the very museum with the immersive exhibitions, which now even go beyond what they used to be, you are provided with virtual reality headsets.

Then exhibitions, yes, it steps in on restitution as well. When you look at the Museum of Looted Antiquities, it's an extraordinary database that they have developed of more than 850 repatriation cases involving nearly a million items.

Lise McLeod
You have mentioned the art market, and you mentioned the art world. How does this all affect the artists? Has this transformation or maybe expansion to the digital environment, positively affected the artists?

Massimo Sterpi
Let's say that I often use this sentence when I open my conference about art law, that artists are the research and development department of humanity. So to say that artists are normally early adopters of new technologies because they are curious and they are very fond of innovation. And in fact, no surprise that many of the big artists embrace the new technologies like Daniel Hirst that made a big project on blockchain or a very famous artist that embraced AI.

Nowadays, I would say that AI is the new Photoshop. Every artist using a computer is now experimenting with AI. They use AI as an assistant, basically as a sophisticated assistant. By the way, all these myths about around AI and its capacity to create is more hype than reality because if you ask artificial intelligence with simple prompts to create an image of something, the image is super banal, really low quality. Whereas artists are able with multiple prompts, addition and things and the source material to be crunched then by the AI to direct the AI to do what they do. So I see more and more of a symbiotic relationship between the technology and the artist.

Certainly, on the other hand, there is an undeniable impact on certain kinds of creative works that are going to be more and more done. I'm thinking about commercial music, for instance, certainly not the big composer, not Beethoven, but the typical music that you hear as the background of a commercial video or a slideshow of your photos. This kind of music is now composed a very good level by artificial intelligence or simple images or a new version of a logo can be elaborated by artificial intelligence. So certainly there could be some substitution.

So let's say a lower level of creativity like decoration or this kind of very simple creativity is certainly going to be severely impacted. High level, I wouldn't be so much fearful. People would not spend millions into something developed by a machine or primarily by a machine, or at least they still evaluate much more the man behind the machine.

Lise McLeod
A last question to take advantage of the wealth of knowledge that you both have, I don't know what the correct time period would be because I'm thinking about what do you think will happen with the art market in the coming 5 years?

How do you feel - like for the next edition of the book - what do you think might happen?

Massimo Sterpi
I think technology has already had a very strong impact in the last five years. I think it's a bit more unlikely that they will have another so big impact also because the emerging technologies that I see do not even like quantum computing, for instance, or this kind of thing, it will just accelerate what is possible now. On the other hand, I think there will be more politics in the frame.

Politics meaning this idea of everything that has to be repatriated, which I believe it's a bit against history, because artworks have always circulated around the world, and the idea that we deny the rest of history and want everything back home, which by the way, risks to make every country very provincial, because if you just have your own stuff, what's your exposure?

I do not believe that's necessarily a good, let's say, evolution, but I think it will be an evolution. So I expect more treaties on recovery of goods, more treaties about archaeology and cultural goods, even in countries that do not have that. I know I've even participated in the reformation of certain laws, certain emerging countries concerning the protection of cultural goods. And now there will be also, for instance, a new law that is already enforced, but that is progressively entering force about the limitation to import of artworks into the European Union. So, we want that everything entering the European Union must be clean and traced.

We should know where it comes from, how it was exported and everything, which is basically impossible in the end. And then you have other laws applying like anti-money laundering that applies expressly to the art market. So, I see many laws that are impacting the art world and not necessarily making the circulation of art easier or more effective. So that's what they expect. More regulation to come from different angles, especially from the cultural goods, the tax and let's say regulatory angles.

Bruno Boesch
Yes, Lise, if I may, often you read that the art market is unregulated, as just pointed out by Massimo. It is not in many ways. It is very regulated, it is increasingly regulated. But still you can read about this myth of an unregulated market. This is just a misconception. What I'd like to make perhaps by way of an additional comment on collecting more than the art world in the broader sense as dealt with by Massimo. I think there's a generational shift in collecting going on. And there's a change of garde. The people who used to collect, they started probably early 20th century.

People who used to collect impressionists, then modern and then contemporary art. This is a generation that is waning. This is the generation of Massimo and me. Now you have worldwide a younger demographics, to use that term, of people who are interested in a broad range of art. If you look at the websites of the advertisement of the big auction houses. You can see that all sorts of collectibles step in.

Watches, sneakers, anything. That is unique in a way, will attract this young generation. They don't draw the same lines between the sectors of the art market. And we have to watch out for them. And it may have an impact on museums and institutions, of course, because they have no reason to be faithful in the same way as they shift platforms when they buy.

They don't have any loyalty to institutions. And the collectors, I was referring to the European and North American classical collectors, they had a relationship to the big institutions. So the big institutions are equally adjusting to a new world of collecting and enjoying art.

Lise McLeod
Thank you to you both. I will have your words resonating in my mind as I read about shifts in the collections and those who collect art. We really encourage the collectors and the researchers of the art world to take a good look at this very comprehensive edition.

Massimo Sterpi
Thank you, Lise.

Bruno Boesch
Thank you Lise. Thank you Massimo.

Lise McLeod
I hope that you enjoyed my conversation with Massimo and Bruno. The third edition of the book 'The Art Collecting Legal Handbook' is available for consultation in our knowledge repository at the WIPO Knowledge Center.

Until next time, and the next Page Points, bye for now.