Droit de Suite to the US?

The Huffington Post is reporting that US Congressman Jerrold Nadler of New York is planning on re-writing his Equity for Visual Artists Act (2011) which sought to add a 7% resale royalty on secondary market sales over $10,000 at auction houses with over $25 million in annual sales.  Half the money collected would go to the artists or their successors and the other half to museums.

With the rewrite this fall, I would assume we can expect a re-submission of the bill to the various House and Senate committees for reconsideration.

Here is the main content of the 2011 bill introduce by Nadler in the House, and Kohl in the Senate

SEC. 3. EXCLUSIVE RIGHTS.

Section 106 of title 17, United States Code, is amended by--
(1) inserting `(a)' before `Subject to sections 107 through 122'; and
(2) adding at the end the following:
`(b)(1) In this subsection, the term `net royalty' means the royalty amount collected less administrative expenses of the visual artists' collecting society. In no case shall the administrative expenses of the visual artists' collecting society subtracted from the royalty amount collected exceed 18 percent.
`(2) Whenever a work of visual art is sold as the result of auction of that work by someone other than the artist who is the author of the work, the entity that collects the money or other consideration paid for the sale of the work shall, within 90 days of collecting such money or other consideration, pay out of the proceeds of the sale a royalty equal to 7 percent of the price. Such royalty shall be paid to a visual artists' collecting society. The collecting society shall distribute, no fewer than 4 times per year, 50 percent of the net royalty to the artist or his or her successor as copyright owner. After payment to the artist or his or her successor as copyright owner, the remaining 50 percent of the net royalty shall be deposited into an escrow account established by the collecting society for the purposes of funding purchases by nonprofit art museums in the United States of works of visual art authored by living artists domiciled in the United States. The right to receive such royalty and the obligation to deposit the remaining share of sale proceeds into the escrow account provided in this subsection may not be waived by the artist or his successor as copyright owner. Failure of the entity collecting the money or other consideration resulting from the sale of the work to pay the royalty provided under this section shall constitute an infringement of copyright. Any such infringement shall be subject to the payment of statutory damages under section 504.
`(3) Paragraph (2) shall not apply to the sale of a work for a gross sales price of less than $10,000, or in exchange for property with a fair market value of less than $10,000.'.

To read the 2011 bill click HERE.

The Huffington Post reports on the re-write

Legislation that would guarantee to fine artists a percentage of the profits whenever their work is sold on the secondary market looks to be heading back for a rewrite, perhaps as soon as this fall.

New York Democratic Representative Jerrold Nadler's "Equity for Visual Artists Act," which he introduced into Congress in late 2011 with now retired Wisconsin Democratic Senator Herbert Kohl, would establish a seven percent "resale royalty" on sales of artwork over $10,000 after the initial sale, with half of that money going to the individual artists or their heirs and the remainder to be used to help nonprofit art museums finance purchases of contemporary art. Because tracking art sales by private dealers and galleries can be quite difficult, the law only would apply to purchases through auction houses with $25 million or more in sales.

A period of written public comment in late 2012 and a round table hearing in Washington, D.C. this past April, convened by the Library of Congress, which had been asked by the Congress to study the bill, produced some fierce resistance on the part of the major auction houses and a major museums association, leading Representative Nadler to acknowledge the need for certain alterations.

"I am continuing to listen to a broad range of feedback on the resale royalty system in the U.S., and will soon consider possible changes to my forthcoming bill on the matter," he said in a statement, adding that he plans to reintroduce the legislation, "once I have gathered that feedback and read the report that will soon be issued by the U.S. Copyright Office."

The artist resale royalties legislation would align United States law more closely with practices in Europe and other areas of the world where what are called artist resale royalties (or "droit de suite") have been adopted years or, in some instances, decades ago. The percentage of these royalties in these countries range from one-quarter of one percent to five percent, with the money held by arts collecting agencies that disperses the royalties to artists, less an administrative fee of between 15 and 25 percent.

Representative Nadler's Equity for Visual Artists Act was drafted by Robert Panzer, executive director of VAGA, and Theodore Feder, president of the Artists Rights Society, both New York City-based organizations that collect licensing fees for works by their member artists. The two organizations would likely move into the realm of collecting resale royalty fees if and when the legislation is enacted. Panzer noted that fees from resale royalty payments would "exceed considerably what we do in licensing."

Source: The Huffington Post