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Editors --- "Update: Government Decision to Abandon a Resale Royalty" [2006] IndigLawB 27; (2006) 6(18) Indigenous Law Bulletin i


While the Federal Attorney-General Philip Ruddock promised that in January of this year he would address the issue of resale royalty,[1] the release of Budget 2006/2007 in May has seen the announcement (in conjunction with the Minister for the Arts and Sport) of $6 million of funding over four years to support visual artists.[2] This is to be a ‘more effective’[3] alternative to introducing resale royalty which would suggest that the Government believes that it has ultimately addressed the issue. However, while increased funds for visual artists are necessary, this does not necessarily address the benefits that could have resulted from the introduction of resale royalty. As Peter Garrett MP pointed out, the Government’s budget allocation for enhancing the National Arts and Craft Industry Support Program is ‘needed in its own right – it is in no way a substitute for the long term benefits of a resale royalty scheme.’[4]

One of the primary reasons given by the Federal Government for the decision not to implement a resale royalty for visual artists is that the system would not work in Australia and would not provide a ‘meaningful source of income for the majority of Australia’s artists.’[5] However, there is considerable evidence that the system would be likely to work here. The scheme suggested by Labor’s Bob McMullan MP is based closely on that of the United Kingdom, where the resale rights are already operating successfully and to the benefit of visual artists. In fact, as pointed out by McMullan in his first reading speech for the Artist’s Resale Royalty Bill 2006 (Cth), the auction houses that are arguing strongly against the scheme have their headquarters In the UK.[6]

The logic of the Government’s reasoning that if the majority of artists in Australia will not benefit from the proposed resale royalty arrangement, then nobody should, has come into question. McMullan argues that Indigenous artists, who are amongst the poorest of the poor in Australia, are likely to be significant beneficiaries of the scheme. He suggests that this should be sufficient reason for the adoption of the proposal.[7]

Garrett argues that the rights of auction houses have been advanced over those of artists, particularly Indigenous artists, and that ‘the vague undertakings foreshadowed by Minister Kemp are no compensation for the loss of visual artists’ primary rights.’[8]

Indigenous lawyer Robynne Quiggin has argued extensively the naivete of expecting a resale royalty to be a panacea to the poor financial circumstance of most artists:

If a resale royalty is expected to remedy or uniformly ameliorate the financial disadvantage suffered by artists, it is destined to be considered a failure, at least in the short term. The purpose of a resale royalty is not to uniformly cure visual artists’ financial disadvantage. It is one measure, among many, to financially support Australia’s visual arts sector, recognise its enormous contribution to the national economy and bring Australian laws into conformity with trends in the European Union.[9]

Tamara Winikoff, Executive Director of the National Association for the Visual Arts (‘NAVA’) also expressed disappointment in the Government’s decision:

After patiently asking for fifteen years, artists in Australia are saddened and perplexed about why the Government will not grant them a royalty right comparable with that enjoyed for so many years by writers and musicians.

It is a gesture the government could afford to make at a time when auction houses and private investors have been making record profits from the resale of artists’ work. It is reprehensible that they begrudge this tiny percentage going back to the creators who are the underpinning of their industry.

Australian artists do not understand why our government does not support them in the same way as the governments of many other countries, including the UK and the whole of the European Union. As a signatory to the Berne Convention, Australia should be honouring its obligations.[10]

* * * * * * * *


New Support For Australia's Visual Artists[11]

Attorney-General Philip Ruddock and Minister for the Arts and Sport, Senator Rod Kemp, have announced $6 million over four years in the 2006–07 Budget to support visual artists as an alternative to a resale royalty scheme.

The initiative includes a $0.5 million per annum training package to help visual artists enhance their engagement with the commercial arts market and an additional $1 million per annum to the National Arts and Crafts Industry Support (‘NACIS’) programme to strengthen the significant Indigenous arts industry in regional and remote communities.

The Government carefully considered the issue of a possible resale royalty scheme and concluded that a resale royalty right would not provide a meaningful source of income for the majority of Australia's artists.

This initiative will instead provide targeted support to individual artists. It will allow a broad range of artists to gain valuable business skills to help them successfully develop and manage their careers. These skills will empower artists to put effective strategies in place to obtain greater income from their work.

The Government considered the effectiveness of a resale royalty scheme following the recommendations of the 2002 Contemporary Visual Arts and Craft Inquiry and in light of submissions in response to the discussion paper it released in July 2004.

Research shows that resale royalty schemes bring most benefit to successful late career artists and the estates of deceased artists.

It would bring little advantage to the majority of Australian artists whose work rarely reaches the secondary art market and would also adversely affect commercial galleries, art dealers, auction houses and investors.

One of the main arguments put forward in support of resale royalty was that Indigenous artists are particularly disadvantaged by the secondary sales market. Research shows, however, that a resale royalty scheme would not end disadvantage for Indigenous artists.

Supporting Information

Why is this important?

Who will benefit?

What funding is the Government committing to the initiative?

$2 million over four years for a tailored training package for visual artists to enhance their engagement with the commercial arts market; and
$4 million over four years to strengthen the promising Indigenous arts industry in regional and remote communities.

What have we done in the past?

When will the initiative conclude?

* * * * * * * *


This Bill, if it were to be implemented, would give to visual artists equivalent rights to those enjoyed by authors and musicians – the right to receive a small proportion, up to four per cent, of the wealth which their skill and imagination creates.[12]

Artist’s Resale Rights Bill 2006 (Cth)[13]

248AB Assignment etc.
(1) Resale right is not assignable.
(2) Any charge on a resale right is void.
(3) Subsection (1) does not prevent the transfer of a resale right which was transmitted to a qualifying body under section 248AD (or is deemed to have been so transmitted under section 248AL), provided that the transfer is to another qualifying body.

248AC Waiver etc.
(1) A waiver of a resale right shall have no effect.

248AF Trusts
Nothing in sections 248AB, 248AD or 248AE prevents a resale right from being—
(a) held, and exercised in respect of a sale, by any person acting as trustee for the person who would otherwise be entitled to exercise the right (“the beneficiary”); or
(b) transferred to such a trustee, or from the trustee to the beneficiary.

248AJ Assistance to new and emerging artists
(1) Where the sale price of a work regarded as a resale exceeds $50000, ten percent of the resale royalty shall be paid by the collecting society into an Artists Support Fund administered by the Australia Council.
(2) The Australia Council shall disperse monies from the Artists Support Fund to new and emerging artists.

[1] Bob McMullan MP, Artist’s Resale Rights Bill 2006, First Reading Speech, 27 March 2006, 32-34.

[2] Attorney-General the Hon Philip Ruddock MP and Minister for the Arts and Sport Senator the Hon Rod Kemp, ‘New Support for Australia’s Visual Artists’ (Press Release, 9 May 2006) 1.

[3] Ibid.

[4] Peter Garrett MP, ‘Resale Royalty Cop-Out’ (Press Release, 10 May 2006) 1.

[5] Ruddock and Kemp, above n 2, 1.

[6] McMullan, above n 1, 34.

[7] Ibid.

[8] Garrett, above n 4, 2.

[9] Robynne Quiggin, ‘The Resale Royalty: An Overview’, (2006) 6(18) Indigenous Law Bulletin.

[10] Tamara Winikoff cited in ‘Artists Rights Not Supported by Government’ (Press Release) 10 May 2006.

[11] Attorney-General the Hon Philip Ruddock MP and Minister for the Arts and Sport Senator the Hon Rod Kemp, ‘New Support for Australia’s Visual Artists’ (Press Release, 9 May 2006) 1.

[12] Bob McMullan MP, Artist’s Resale Rights Bill 2006 (Cth), First Reading Speech, 27 March 2006, 32-34.

[13] Bob McMullan MP, Artist’s Resale Rights Bill 2006 (Cth).

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