COVID-19: Fine art fairs

Fine art gallery white walls and paintings Howden Insurance COVID-19

One challenge for Art Dealers and Gallerists to have arisen from the outbreak of COVID-19 is the cancellation or postponement of Fine Art fairs. Quite apart from the fair organisers who face financial uncertainty themselves, those planning to exhibit at such fairs are left potentially out-of-pocket and with fewer major sales events at which to do business.

 

Some Art Dealers feel that fairs are genuinely fruitful places to trade, and others attend principally to be seen by the right people, but all agree that these gatherings offer them something that they can’t get elsewhere: exposure directly to large numbers of potential buyers.

Can these Dealers, whose fair attendance has been pulled from under them as a result of the Coronavirus pandemic, claim their participation costs back from event organisers?

Whether or not claims can be made successfully to fair organisers outside of the standard Terms and Conditions remains to be seen.

Numerous fairs have been “postponed” — many to next year — rather than “cancelled”, which could have implications to exhibitors. “If a fair is cancelled it is likely a refund will be paid to the Dealer (possibly less administrative costs),” says Rudy Capildeo, a partner at the law firm Charles Russell Speechlys. “If a fair is postponed, the fair will likely retain the dealer’s deposit.” But, Pierre Valentin of Constantine Cannon says, this “will again depend on the law of the contract and its content. It is difficult to offer generic advice”.

Dealers’ potential losses are not limited to attendance fees. Logistics, arranged through specialist Fine Art shippers, account for significant costs; marketing material produced in advance of the fair for circulation to potential and existing customers; Insurance Premiums for the extension of cover to include Stock on exhibition at a fair; local accommodation and travel expenses for staff; food and drink ordered to offer customers at the fair.

All of this will leave many Dealers and Gallerists poorer.

Yet not all fairs are cancelling without the offer of an alternative. Art Basel Hong Kong, for example, went ahead in an entirely virtual space accessible online. The fair ran several online viewing rooms, in which approximately 2,000 artworks collectively valued at over $270 million were displayed, with great success. 235 of the fair’s 242 scheduled exhibitors signed up to display their works in this online fair, and more than 250,000 visitors explored the online viewing rooms – this in comparison to the 88,000 people that attended the
physical fair last year.

In fact, this sudden step-change to virtual art fairs is not a step change at all. It is merely the significant acceleration of a growing trend. Major fairs have had online portals for many years, and it has been reported that more than a third of galleries’ sales from fairs usually occur before the fair opens or after it closes, but attempting to replicate an entire fair experience online was unprecedented.

It should also be mentioned that online fairs also offer the buyer a greater degree of transparency, as every featured artwork was displayed with a specific price or price range. This is highly unusual for an industry famous for its reluctance to make pricing transparent, and excellent for the image of Dealers.

Perhaps, then, the short-term financial pain suffered by Dealers and Gallerists may (in time) be mitigated by the opportunity they have to be pioneers in this new era. Like so many other areas of life, it’s doubtful that art fairs will ever be quite the same again.

 

Harry Syms

Harry Syms

Associate Director Fine Art & Specie

Contact Harry