Challenges doing justice in disputes about art theft and restitution of colonial art – the beauty and the beasts – IBA Annual Conference Miami 2022 session review

Philip Walravens
Verhaegen Walravens, Brussels

At the IBA Conference in Miami in November 2022, the Litigation Committee co-hosted a very interesting session on ‘Challenges doing justice in disputes about art theft and restitution of colonial art’ under the catchy subtitle ‘The beauty and the beasts’.

The speakers were Nicholas O’Donnell from Sullivan and Worcester (Boston/New York), Lucinda Orr of Enyo Law (London), Daniel Weiner of  Hughes Hubbard & Reed (New York), and finally Anne-Sophie Nardon of Borghese Associés (Paris).

Nick O’Donnell started the session by setting the scene, providing an overview of the applicable legal framework in the US, notably: 

• The 1970 UNESCO Convention on the means of prohibiting and preventing of illicit import, export and transfer of ownership of cultural property; and
• The 1995 UNIDROIT Convention on stolen or illegally exported cultural objects;
• Section 1595a (a), of the US Customs Code.

Mr O’Donnell then discussed a series of US cases applying these texts: 

• The US v Mask of Ka-Nefer-Nefer case of 2012, dealing with the sale of an Egyptian artefact purchased by a US museum; 
• A case in the Southern District of New York of 2021 involving Christie’s, a private case on the alleged unlawful excavation and smuggling out of Turkey of a millennia-old cultural artefact (Republic of Turkey v Christie’s Inc. and Michael Steinhardt); and
• Barnet et al. v. Greece, 2nd Circuit case of 2020, on a bronze horse figurine that Sotheby’s had planned to auction in 2018.

He also briefly explained the concerns in relation to the Benin bronzes, brought to the British museum (and other European institutions), after they were looted by a British expeditionary force in the 19th century.
From these cases Mr O’Donnell drew the following summary conclusions: 

• Different types of legislation may be relevant when confronted with cases involving art theft and restitution.
• The customs laws of each country are a very important factor in day-to-day practice.
• From a legal point of view, if excavation and export took place before the entry into force of the applicable legislation, it will be difficult to obtain restitution.
• That is why the moral aspect is becoming more and more important: if the artefacts were obtained through looting (such as in the Benin bronzes case), museums and governments are under ‘moral’ pressure to return them, regardless of when this took place.

The second speaker, Lucinda Orr, then discussed the anti-money laundering (AML) guidelines in the UK and the EU, as applicable on art market participants.

Ms Orr started out by clarifying the scope of these regulations: an art market participant is a business trader, but an artist is not. She noted that in the UK, the definition of ‘works of art’ did not include, for instance, antiquities, cars or stamps, and that each of the 27 EU countries had a different definition.

If, however,  the respective criteria were met, a series of obligations had to be fulfilled: these included but were not limited to registration, appointment of a compliance officer, conduct of customer due diligence, and reporting of suspect activity.

The speaker summarised the position by criticising the heavy formalities applicable, the general ‘leaky’ definitions and the lack of uniformity.

Then it was up to Dan Weiner to discuss AML and terrorist financing aspects in the US.

He referred to the Money Laundering Control Act (MLCA) and the Bank Secrecy Act (BSA), and talked the audience through the role of the US Office of Foreign Assets Control (OFAC).

MLCA also applies in the art business, and the key question there is knowledge: did the entity subject to these rules know or should have known that transactions could be in violation of sanctions – with criminal and civil penalties being possible.

The BSA applies to ‘financial institutions’, expanded in 2021 to antiquities dealers (but not to any other type of art dealers).

OFAC imposes an obligation on art businesses not to engage in transactions with designated ‘terrorists’ (SDGTs). Penalties are imposed based on strict liability, and compliance programmes are encouraged.

The speaker then discussed the Responsible Art Market initiative (RAM), a cross-industry initiative formed in Geneva, aimed at raising awareness of threats and risks faced by the art industry; RAM has published a series of guidelines, and has prepared a due diligence toolkit for art transactions.

Finally, Mr Weiner spoke about the Court of Arbitration for Art (CAFA), a tribunal based in The Hague devoted exclusively to resolving art disputes through arbitration and mediation. CAFA started out in 2019, and ensures reliable, economical and fast proceedings with binding awards that are broadly enforceable.

The final speaker, Anne-Sophie Nardon, took us back to the EU, with regulation (EU) 2019/880, defining the conditions applicable on the import of cultural property in Europe.

The regulation prohibited the import of certain listed cultural goods (if they were illegally exported) and announced an export permit system by 2025 for archaeological objects and certain collections (eg paintings and coins) of more than 200 or 250 years old.

This raises a series of interesting questions: what if the country of origin no longer exists? What if there was a regime change? What if documentation was lost?

Ms Nardon then briefly discussed the role of the International Criminal Court (ICC) regarding the protection of cultural heritage. She quoted the Timbuktu case, in which the ICC has held that it has jurisdiction over the destruction by Al Qaeda of mausoleums of Muslim saints in Mali [ICC-01/12-01/15], qualifying this as a war crime under the Rome Statute on war crimes. The audience also learned that the ICC has opened an investigation into similar crimes in Ukraine.

To finish, Lucinda Orr touched upon the UK Arts Council Guidance on restitution. After establishing the origins of an artefact, restitution claims should be assessed based on argued legal or ethical factors, such as (i) the significance of the object to the claimant; (ii) how the object was removed; (iii) how the museum has engaged with the object; and (iv) who is raising the claim.

This process can lead to a transfer of ownership, but also to a loan or a joint legal ownership.

Finally, the panel addressed a series of interesting questions and remarks by a very lively audience.