Artist’s Resale Rights: Law, calculation and recent developments

Since 2006, artists in the UK have been protected by a statutory right known as Artist's Resale Right (ARR). The right gives creators (and their estates after death) the right to a royalty upon the sale of their work on the secondary market. The scheme was established to ensure creators (and their beneficiaries) benefit from the resale market, share the long-term value of artwork, and support creative endeavours. The introduction of ARR in the UK brings the law in line with what is available for other creators, such as musicians receiving ongoing royalties for the use of their work.

What is the artist's resale right?

The Artist's Resale Right Regulations 2006 (ARR) gives artists (or their estate) a legal entitlement to a royalty payment whenever an original work of art is resold via an art market professional, such as an auction house, gallery, or art dealer.

The right lasts for the artist's life and then a further 70 years after their death. It covers a wide range of work, including paintings, drawings, sculptures, ceramics, tapestry, glassware, photographs and copies of limited edition pieces under the authority of the artists themselves.

To qualify, the resale must:

• Involve an art market professional (e.g. an auction house or art dealer).

• Reach a minimum threshold of £1,000 (as of April 2024).

• Concern a work by a UK national or an artist from a country with reciprocal rights.

The right cannot be waived or sold. It is automatic and applies once the artwork has left the artist's hands.

How it is calculated

Royalties are worked out on a sliding scale applied to the sale price (excluding any VAT and buyer's premiums). The current rates are:

• Up to £50,000 - 4%

• £50,000.01 - £200,000 - 3%

• £200,000.01 - £350,000 - 1%

• £350,000.01 - £500,000 - 0.5%

• Above £500,000 - 0.25%

The royalty on a single resale is capped at £12,500.

How royalties are managed and collected

In practice, royalties are not paid directly from the buyer to the artist. Instead, the seller is legally responsible to pay the royalties (via ARR) to the auction house or professional. The auction house will then collect the royalty on the artist's behalf and transfer the sum to collection societies. Dealers and auction houses are legally obliged to keep a record of relevant sales and provide information to collection agencies upon request.

Most artists and estates mandate specialist collection societies such as 'Design and Artists Copyright Society' (DACS) or the 'Artists' Collecting Society' (ACS) to manage ARR claims. These organisations monitor sales, calculate royalties, invoice dealers and then distribute payments to the artists or their estate.

The international dimension

The UK's ARR regime was introduced to comply with EU Directive 2001/84/EC, which harmonised resale rights across the European Union from 2006. The directive was designed to ensure artists across the EU receive equivalent protection and to prevent art sales being diverted to jurisdictions without ARR.

Following Brexit, the ARR was retained in domestic law through the Artist's Resale Right Regulations 2006. The UK-EU Trade and Cooperation Agreement confirmed ARR as an inalienable right, so EU artists still benefit from UK sales, and UK artists remain eligible in the EU.

Beyond Europe, the UK has expanded the reach of ARR through bilateral agreements. Two key developments are:

• Australia (2024) - UK and Australian artists and estates can now collect royalties on qualifying resales in each other's markets.

• New Zealand (2023/24) - a similar reciprocity deal was agreed, allowing New Zealand artists to benefit from ARR on UK sales, and UK artists to collect royalties when works were resold in New Zealand.

These agreements underline how ARR is evolving into a more global right, with the UK positioning itself as a jurisdiction that supports artists internationally as well as domestically.

 ARR in practice

In 2022, ACS and DACS brought proceedings against London-based art dealer Ivor Braka Limited for failing to pay royalties to living artists or their estates. It was alleged that Braka and his company had failed to provide information about qualifying resales, despite being legally required to do so under ARR Regulations. The societies said they had made quarterly requests since the Regulations were introduced in 2006 but had never received the necessary data to calculate royalties. Braka denied wrongdoing, arguing that the requests were too broad to be valid and criticising ARR more generally as an unfair burden on dealers.

The matter was settled in early 2023 on confidential terms, with both sides confirming they would cooperate to ensure artists, and their estates are paid in the future. While it stopped short of court judgment, the dispute was the first of its kind in the UK and sent a clear message to art market professionals - compliance with ARR disclosure duties is not optional, even for leading market figures.

Key take aways

• Art market professionals must comply - dealers, galleries and auction houses are legally obliged to disclose qualifying resales and pay ARR royalties. Non-compliance risks disputes, enforcement action and reputational damage.

• Collectors may be caught too - even private individuals may fall within the regime if they sell through a professional intermediary, so it is worth checking when ARR applies before a sale.

• Estates and heirs' benefit - artist's families can claim royalties for 70 years after the artist's death, creating a valuable long-term income stream that needs proper management.

• Due diligence is key - buyers and sellers should factor ARR into sale negotiations and contracts. Clear terms on who will pay the royalty can prevent late disputes.