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28 May 2019

Ivory Act 2018 – a political triumph at the art market's expense?

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Amidst government deadlock on Brexit, one piece of legislation did manage to sail serenely through the parliamentary process.

The Ivory Act 2018 (the "Act") received Royal Assent on 20 December 2018 and is expected to come into force later this year. The Act introduces a near total-ban on the trade of ivory and has been hailed a "landmark in our fight to protect wildlife and
the environment
" by Environment Secretary Michael Gove.

The Act has, however, caused some consternation in the art market, particularly amongst dealers in antique ivory who are concerned their businesses will crumble.

What is banned?

The Act introduces a ban on "dealing" in items containing elephant ivory within the UK.

"Dealing" includes buying, selling and hiring ivory, offering or arranging to buy, sell or hire it, or keeping it for sale or hire. It also includes exporting it from or importing it into the UK for sale or hire.

Are there any exceptions?

The Act carves out the following categories of objects which are exempt from the ban:

  • Objects with a small amount of ivory
      
    The so-called "de minimis" exemption applies to objects which contain less than 10% of ivory by volume and were made prior to 1947.
  • Rarest and most important objects
     

    Pre-1918 items of outstandingly high artistic, cultural or historical value will also be exempt. In determining whether an object falls within this category, the rarity of the item and the extent to which the item is an important example of its type will be taken into account.
  • Musical instruments
     

    The instruments must be pre-1975 and contain less than 20% of ivory by volume.
  • Portrait miniatures
     

    This applies where the portrait miniature is pre1918 and has a surface area of no more than 320cm².

In order to enjoy the benefit of the above exemptions, the owner of the item must obtain an exemption certificate from the government before buying, selling or hiring the item.

What are the penalties?

Anyone who directly breaches the prohibition on dealing ivory, or causes or facilitates a breach, commits an offence under the Act.

The Act provides for a range of criminal and civil sanctions including a maximum sentence of up to 5 years' imprisonment, an unlimited fine or both.

How will this affect museums?

The Act focusses on the dealing of ivory, so the Act should have little effect on ivory works which are already in museums' collections (unless of course they wish to de-accession).

Importantly, the Act also contains a further exemption for sales to and between "qualifying museums". This applies to museums accredited by the Arts Council England, the Welsh Government, the Scottish Government or the Northern Ireland Museums Council in the UK, or, for museums outside of the UK, the International Council of Museums.

As was the case before the Act was passed, any impact on museums will likely be confined to reputational (rather than legal) ramifications. By way of recent example, there was no law preventing the British Museum from accepting a donation of 500 Chinese ivory figures in June last year, but it was forced to defend itself to the press after a wave of negative publicity.

How will this affect dealers?

Dealers have expressed dismay at the stringent restrictions contained in the Act, arguing that it will do little to stop the trade in poached ivory but potentially render vast quantities of artworks and cultural objects unsellable. As one dealer queried in the Antiques Trade Gazette, "I cannot see how one elephant alive today will be saved by me not being
able to sell this chess set
".

Organisations including LAPADA (the Association of Art & Antiques Dealers) and BADA (the British Antique Dealers' Association) lobbied the government in the consultation process. Their concerns included:

  • The level of the "de minimis" threshold. It was argued (unsuccessfully) that this should be raised to 50% for cultural objects made of ivory as 10% was so low that, for example, almost every object with a solid ivory handle would fall foul; and
  • The bar for the "rarest and most important" exemption seems unreasonably high, and will not assist those trading in low-value objects (such as ivory crucifixes, Japanese netsuke and African carvings) which, whilst important, are not
    necessarily museum-quality.

How will this affect private collectors?

The prohibition applies only to "dealing" (buying, selling or hiring ivory). The Guidance Notes to the Act make clear that the prohibition will therefore not affect private collectors to the extent that they own, inherit, gift, donate or bequeath items made of or
containing ivory.

If a private collector wishes to sell an ivory item in their collection, they will likely be restricted to selling to a qualifying museum (unless another exemption in the Act applies). There is therefore a strong possibility that pieces which do not meet museum standards will effectively be rendered unsellable. The resulting impact on value, for example in the
context of an estate, should not be ignored.

What's next?

It is anticipated that the Act will come into force in late 2019 once necessary secondary legislation is passed, the online registration system for exempt objects is developed and guidance has been issued.

A further consultation is also due to take place on the extension of the elephant ivory ban to include hippopotamus, walrus and narwhal ivory.

As for the Act's impact on the art market, the conversation might not yet be over. The Antiques Trade Gazette reported in January that BADA, LAPADA, the Antiquities Dealers' Association and auctioneer body SOFAA are stepping up their plans
for a judicial review. The trade bodies encouraged their members to take part in a survey to assess the economic impact of the Act. This is intended to form the basis of a legal challenge.

It appears that, despite the ease with which it was passed, there will be a few more hurdles before the Act can take effect.

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