Art Usage Royalties for Artists
Much like musicians who earn royalties from their music streaming on platforms like Spotify, visual artists too have the opportunity to receive ongoing compensation for their creative works. Beyond the initial sale, the Resale Royalty Scheme opens up a world of possibilities for artists, allowing them to earn royalties when their artworks are resold in the secondary market. From paintings and sculptures to digital creations, this blog explores how the Resale Royalty Scheme supports artists, ensures fair compensation, and promotes a thriving artistic community. Join us on this journey to understand the inner workings of this scheme, its global impact, and how you can play a part in empowering artists through the appreciation of their enduring contributions to culture and society.
Visual artists can be entitled to royalties for their creations, which typically encompass various forms of tangible art, including paintings, sculptures, and more. This concept mirrors how musicians earn royalties for their music on platforms like Spotify.
Let’s delve into some common scenarios where visual artists can earn royalties:
Reproduction of Artwork: When a visual artist’s work is reproduced, such as through prints, posters, or merchandise, they may receive royalties for each sale or reproduction.
Public Display: Certain countries have laws mandating businesses or institutions, such as museums and galleries, to pay royalties when publicly displaying an artist’s work. This is commonly known as “droit de suite” or “resale royalty rights.”
Licensing: Visual artists can license their work for various purposes, including its use in advertising, films, or publications. In these cases, they can negotiate royalties as part of their licensing agreements.
Digital Usage: With the proliferation of digital media, visual artists can also receive royalties when their work is used online, whether on websites, in digital publications, or multimedia presentations.
The specifics of how royalties are calculated and distributed can vary depending on the country, region, and individual agreements between artists and those utilizing their work. These royalties play a crucial role in providing income for many visual artists while safeguarding their rights and interests in their creative endeavors.
Reselling Royalties for Artists
Artists from various disciplines share a common goal – the desire for recognition, fair compensation, and appreciation for their creations. In Australia, the Resale Royalty Scheme addresses this aspiration by ensuring artists and right-holders receive 5% of the sale price when eligible artworks, including visual and musical creations, are commercially resold for $1,000 or more. However, the relevance of this scheme extends beyond borders, encompassing a broader spectrum of art forms and countries. In this article, we will explore the Resale Royalty Scheme in the context of music and other arts, why it exists, and its global presence.
Supporting Artists: A Universal Goal
Artists pour their passion, livelihood, expression, and legacy into their creations. However, financial stability is often elusive in the life of an artist, especially when it comes to the resale of their artworks. This article explores an essential aspect of the art world that often goes unnoticed in Australia – the Resale Royalty Scheme. This scheme ensures that artists and right-holders receive a fair share of the pie when their eligible artworks are commercially resold for $1,000 or more. Let’s delve into the details of this scheme, how it works, why it’s important, and how you can support artists by participating in it.
Resale Royalty Scheme: What is it?
The Resale Royalty Scheme, often referred to as the “Artists’ Resale Royalty,” is an initiative that aims to provide artists with a financial benefit when their works are resold in the secondary market. In Australia, this scheme was introduced on June 9, 2010, and is governed by the Resale Royalty Right for Visual Artists Act 2009 (the Act).
Under this scheme, artists and their estates (right-holders) are entitled to receive 5% of the sale price when eligible artworks are resold for $1,000 or more. Eligibility criteria include:
- The artist must be an Australian citizen, or a citizen of another country who is a resident in Australia, or a person who is domiciled in Australia.
- The artwork must be an original work of art.
- The resale must occur in Australia, or the seller must be an Australian citizen or resident.
How Does the Resale Royalty Scheme Work?
Now that you understand the importance of the Resale Royalty Scheme, let’s take a closer look at how it operates:
Eligible Artworks: The scheme applies to specific categories of artworks, including paintings, drawings, sculptures, photographs, and prints. However, it doesn’t cover all art forms, such as jewelry or craft.
Sale Price Threshold: The artwork must be resold for $1,000 or more to trigger the royalty payment. If the resale price is below this threshold, the scheme does not apply.
Calculation of Royalty: The resale royalty is calculated at 5% of the sale price, excluding GST (Goods and Services Tax). It’s important to note that the resale royalty is capped at $10,000 for any single artwork.
Reporting and Payment: Sellers and art market professionals involved in the resale process are responsible for reporting and paying the royalty. The scheme is designed to be straightforward, with mechanisms in place to ensure compliance.
Administration: The Australian Government has appointed the Copyright Agency to administer the Resale Royalty Scheme. They handle the collection of royalties and ensure that they are distributed to the rightful artists and right-holders.
Resale Royalty Scheme: A Multidisciplinary Perspective
Visual and Performing Arts: The Resale Royalty Scheme is not limited to music alone; it extends its embrace to visual, performing arts, and other artistic forms. If an eligible music composition or performance is resold for $1,000 or more, artists and right-holders are entitled to a 5% royalty, mirroring the principles of the scheme applied to music.
Eligibility Criteria: The scheme’s eligibility criteria are relatively consistent across artistic disciplines. To qualify, the artist or right-holder must meet certain requirements, such as Australian residency or citizenship, or domicile in Australia. However, these criteria can vary depending on the country’s specific laws and regulations.
Global Application: While the Resale Royalty Scheme discussed here pertains to Australia, similar schemes exist in various other countries worldwide. In fact, the concept of resale royalties for artists is recognized in many countries, although the details and thresholds may differ.
Why the Resale Royalty Scheme Exists
The Resale Royalty Scheme serves several vital purposes within the world of arts and culture:
- Recognizing Artistic Contribution: It acknowledges that the value of an artist’s work can appreciate over time and that artists should benefit from this appreciation, regardless of the art form.
- Providing Financial Support: By offering artists a share of the resale value of their work, the scheme provides ongoing financial support, which can be crucial for emerging artists in all disciplines.
- Encouraging Investment: The scheme encourages investment in artistic creations by ensuring artists and right-holders receive a portion of the proceeds when their works are resold. This incentivizes investment in arts and culture.
Who Does the Resale Royalty Scheme Pertain To?
The Resale Royalty Scheme is designed to benefit artists and right-holders. However, eligibility and applicability may vary depending on the specific circumstances:
- Artist or Right-Holder: The artist or right-holder is typically the primary beneficiary of the scheme. In the case of music, this could include composers, songwriters, and performers, among others.
- Australian Residency or Domicile: In Australia, eligibility often hinges on the artist’s Australian citizenship, residency, or domicile. This means that artists who are not Australian citizens but reside or are domiciled in Australia can still benefit from the scheme for their eligible artworks created in or outside Australia.
- Location of Sale: The scheme applies to artworks resold in Australia, regardless of where the artwork was originally created. This means that even if an artist is overseas, if their eligible work is resold within Australia for $1,000 or more, they are entitled to the royalty.
Resale Royalty Beyond Borders
Australia is not alone in recognizing the value of resale royalties for artists. Many countries have implemented similar schemes to support artists across various artistic forms. Here are a few examples:
- France: France is often credited with pioneering the concept of resale royalties. Their Droit de Suite legislation ensures that artists receive a percentage of the resale price when their works are resold through auctions or galleries.
- United Kingdom: The United Kingdom implemented the Artist’s Resale Right (ARR) in 2006, providing artists with a percentage of the resale price when their works are resold.
- United States: Although the United States does not have a national resale royalty scheme, some states have implemented their own, such as California’s California Resale Royalties Act, which applies to sales of fine art within the state.
- European Union: The European Union has established a harmonized framework for resale royalties, allowing artists to benefit from the resale of their works across member states.
How to Navigate the Resale Royalty Scheme
Whether you’re an artist, collector, or art market professional, understanding the Resale Royalty Scheme and similar schemes in your country can lead to fair compensation and compliance. Here are some key steps to navigate the scheme effectively:
- Be Informed: Familiarize yourself with the specific regulations governing resale royalties in your country. Each country may have different thresholds, eligibility criteria, and reporting mechanisms.
- Seek Legal Advice: If you’re unsure about the legal implications or requirements of the scheme, consider consulting with legal experts who specialize in intellectual property and art law.
- Report and Comply: If you’re involved in the sale or resale of eligible artworks or musical compositions, be diligent in reporting and complying with the scheme’s requirements. This ensures that artists receive their rightful royalties.
- Support Artists: As an art enthusiast or collector, actively support artists by purchasing their work and advocating for fair compensation. By participating in the resale market, you contribute to the sustainability of the artistic community.
Why is the Resale Royalty Scheme Important?
Supporting Artists: The Resale Royalty Scheme provides artists with an ongoing source of income. This financial support can be crucial for artists, especially emerging ones, as they work towards establishing their careers.
Recognizing the Value of Art: By giving artists a share of the resale value of their works, the scheme recognizes the enduring value of art. It acknowledges that the value of an artwork can appreciate over time and that artists should benefit from this appreciation.
Promoting Australian Art: The scheme encourages investment in Australian art by ensuring that artists and right-holders receive a portion of the proceeds when their works are resold.
Can Anyone Resell Artwork Under the Scheme?
The Resale Royalty Scheme is not limited to artists alone; it extends to anyone involved in the resale of eligible artworks. This includes art galleries, auction houses, art dealers, and private collectors. However, there are certain key points to keep in mind:
Resale Threshold: As mentioned earlier, the artwork must be resold for $1,000 or more to trigger the royalty payment. Artworks sold below this threshold are not subject to the scheme.
Reporting Responsibility: Those involved in the sale of eligible artworks are responsible for reporting and paying the royalty to the Copyright Agency.
Privacy and Confidentiality: Sellers and art market professionals are required to maintain the privacy and confidentiality of the artist’s identity when reporting the resale.
How to Participate and Support Artists
Supporting artists through the Resale Royalty Scheme is not just a legal requirement; it’s a way to contribute to the thriving art ecosystem in Australia. Here’s how you can get involved:
- Buy Artworks from Australian Artists: By purchasing artworks directly from artists, galleries, or art fairs, you ensure that a significant portion of your investment goes directly to the artist. This not only supports the artists but also helps promote the local art scene.
- Be Informed: If you’re considering reselling artwork that meets the eligibility criteria, familiarize yourself with the Resale Royalty Scheme. Understand your responsibilities as a seller or art market professional to ensure compliance.
- Consult with Experts: If you have questions or concerns about the Resale Royalty Scheme, consider consulting with experts in the field. Art lawyers, accountants, and professionals can provide guidance on legal and financial aspects.
- Spread Awareness: As an artist or art enthusiast, you can play a crucial role in spreading awareness about the Resale Royalty Scheme. Share information about the scheme on social media, in art communities, and through your networks.
- Support Local Art Initiatives: Attend art exhibitions, openings, and events in your community. By participating in the local art scene, you contribute to the growth of the artistic community and help artists gain recognition.
Frequently Asked Questions
To provide you with comprehensive information on the Resale Royalty Scheme, let’s address some common questions that artists and art lovers may have:
What happens if the resale price of an artwork is less than $1,000?
If the resale price is below $1,000, the Resale Royalty Scheme does not apply, and no royalty is payable.
Are there any fees or costs associated with the scheme for artists?
No, there are no fees or costs associated with artists registering for the Resale Royalty Scheme. The scheme is designed to benefit artists and right-holders without any financial burden.
How can artists or right-holders register for the scheme?
Artists and right-holders do not need to register for the scheme themselves. The Copyright Agency, the scheme’s administrator, keeps a database of eligible artworks and their creators. They handle the distribution of royalties.
Can artists opt out of the Resale Royalty Scheme?
Artists cannot opt out of the scheme for eligible artworks. Once an artwork is eligible, it remains covered by the scheme for the duration of the artist’s lifetime and 70 years after their death.
The Resale Royalty Scheme is a beacon of hope for artists across various artistic forms, providing them with a fair share of the value their creations accumulate over time. While the scheme discussed here is specific to Australia, it echoes the global sentiment that artists deserve recognition and compensation for their enduring contributions to culture and society. Whether it’s a visual masterpiece or a musical composition, the Resale Royalty Scheme and similar initiatives worldwide ensure that artists continue to thrive and inspire through their work.