Michelle Mao is an IPilogue Writer and an incoming 2L JD candidate at Osgoode Hall Law School.
Imagine you are a new artist, who sells your art for $500 dollars, which is enough to cover the cost of supplies and your time spent on the piece. Then you find out ten years later that your original piece was resold for over $50,000 dollars while you are destitute. This situation is why artists around the world advocate for resale rights.
An Artist Resale Right (ARR) allows the artist or the artist’s estate to profit or financially benefit from the sale of the artist’s work in secondary markets after the original sale. Artists and advocates consider this right as a part of the wage artists should receive for their profession and livelihood. As of May 2022, Canada does not have a policy towards ARR in place.
Supporters have several arguments in favour of implementing ARR in Canada. First, artists as a group are more vulnerable to financial instability or more likely to take on additional jobs to achieve financial stability. ARR can provide a second source of income that can help artists improve their financial stability. Second, other artistic professionals, such as musicians and writers, already have systems in place to continuously profit from the downstream payments made in relation to their original work.
Those opposing resale rights raise concerns regarding the possible heavy burden on art sellers, and art resellers may not feel properly compensated for the risk they incur when collecting pieces for galleries and resale. Issues regarding compliance with proper payment and the lack of global ARR standardization can complicate many logistics.
While the law of ARR is no longer a novel idea in the legal world, the importance of protections for an artist’s fair share of profits is ever-increasing as Non-Fungible Tokens (NFTs) become mainstream. Currently, the Regulation for ARR in the United Kingdom’s specific wording creates a loophole for NFT transactions to forego payment to the original artist. This is because NFTs are a “one-time copy” of original art, and thus resale of the NFT does not activate ARR entitlements, which only apply to the original work.
Overall, profits made from the sale (and resale) of art must be balanced between artists, art professionals, art curators, auction houses, etc. sWith the value of artworks having the potential to increase so exponentially over time, it may be proportional for artists to make a percentage of resale revenue. The secondary income would acknowledge the artist’s mastery and skill, while properly compensating them for the value of the art that they created. Now, as NFTs become increasingly tied to high-value transactions, future artist compensation is increasingly important. Future ARR advocacy should consider how ARR can and should be adapted to not only address logistical complexities but also NFT loopholes.