The United Kingdom’s online auction market place is gearing up for new legislation that will allow auction buyers “a fortnight before” they can cancel a transaction. This fourteen-day cooling off period, some say, clashes with the market practices of art and antique auctions, in general, let alone those conducted online. While some say this is just the way e-commerce is headed, there are far reaching implications on the dynamics of art auctions both from a competitive standpoint as well as with consumers and suppliers.
Buyer Beware has been the longstanding rule for auctions, with all sales being final. This has set up a landscape where the idea that a returned artwork (for example) form auction can irrevocably tarnish that artist’s value for years to come; and, if the auction is highly publicized, the auction house by extension. This idea of “public” is a key factor in this new UK legislation because “[u]nder the new rules, virtual auctions are not considered public and so online buyers will have the right to cancel.”
However, some are praising this law because it will allow the buyer more time to inspect his or her purchase, ensure authenticity and proper provenance. Further, sellers, on virtual auctions, will be forced to reveal information about themselves prior to the sale.
While this may seem to set a wonderful stage of transparency and fair practices for years to come, this will affect the course of art auction competition and even foster forgery practices. A virtual auction may be deemed “public” if the lot can be viewed in person. Aside from the fact that all lots can be (theoretically) viewed in person, this will force a larger divide between “The Big Three” auction houses (Christie’s; Sotheby’s; Phillips) and smaller, niche facilities that are capitalizing on this new air of comfort with purchasing big ticket items online. This may even stunt the growth of overseas markets for some budding online companies like Paddle8 or Artspace.com. Furthermore, items that may not be suited for the fore-mention Big Three, but still require a reputation to be sold, may be sequestered to an ill-fitting platform like eBay where fakes and forgeries have been historically rampant.
The Merchant of Venice
Question to Consider:
With art auctions, i.e. the secondary art market, being such a large component of the art market, how will the strategies shift in terms of galleries and auction houses working to find new supply (artists/art works) without diluting the value of the market itself? How will the artists themselves adapt to this changing landscape and does their evaluation of new market dynamic affect their output?
 Shakespeare, William. The Merchant of Venice. 1596. The Complete Works of William
Shakespeare. N.p.: World Library, 1996. N. pag. Project Gutenberg. Web. 1 April 2014. <http://www.gutenberg.org>.
 Shaw, Anny. "New Rules Threaten Online Art Market in the UK." The Art Newspaper. Umberto
Allemandi, 9 Jan. 2014. Web. 1 Apr. 2014. <http://www.theartnewspaper.com/articles/New-rules-threaten-online-art-market-in-the-UK/31550>.