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The Copyright Office Proposes Resale Royalties for Visual Artists

resale royalties

Artists, such as musicians and authors, receive royalties each time their artistic works are used or sold. Hear a song on the radio and you know that its creator will receive a check for its use. That is not always true for visual artists.  How often has the astute art patron bought an artist’s early work, which they later sell for many times the price?  The artist may have a copyright in the work but not in the resale of the original. Well, that might be changing. The Copyright Office has just issued a comprehensive report, “Resale Royalties: An Updated Analysis,” which proposes legal changes to copyright laws that will allow visual artists to receive royalties every time their original work is resold.

The copyright Office proposes a change to copyright laws that will allow visual artists to receive royalties every time their original art is sold.

The copyright office solicited public comments from a variety of stakeholders and conducted independent research concluding that certain visual artists may operate under a disadvantage under copyright laws relative to authors of other types of creative works. Authors of books, films or songs sell and distribute their works in multiple copies but a visual artist’s typical works is a single item, rarely sharing in the long-term financial success of those works.

This is not a unique idea as many other countries have royalty resale laws for visual artists.  In this proposal, the estimated royalty rate would be 3-5%, which the artist would receive each time a work is sold, and would likely only apply to public auctions.

According to the report, reproduction and other such rights generate only a fraction of a typical fine artist’s income while the majority of profits on a work come from their resale. The report also references a study published in 2011, which analyzed artist wages and salaries across specific industries.  The study suggested that the median wages for fine artists (including painters, sculptors, illustrators and multimedia artists, but excluding photographers and graphic designers) was $33, 982 whereas writers and authors (such as novelists, playwrights, or script writers) received an appreciably higher wage of $44, 794. The Bureau of Labor Statistics, which also tracks wages for artists, also shows a disparity, with an average wage for fine artists of $54,000, writers and authors at $68,420 and composers receiving $53,420.

Opponents of this proposal suggest that even if one accepts the fact that copyright laws fail to accommodate for this particular problem, it is not the role of copyright law to ensure “both statutory and market parity among authors.” Other say that visual artists may make more on their initial sale than do other types of authorship, or that if there is a demand for reproductions, then those artists have the rights to license and distribute the work to the public and receive income from those sales.

However, the opponents are leaving out a crucial consideration; the increase in the value of the visual artists work is due to the later success of the artist, which Is not accounted for under current rules.  For example, a band can release their first record, which generates very little sales since they are relatively unknown.  Later, the band becomes famous generating huge sales of their new album, and with that success, sales of their initial album skyrockets as well.  The band will receive royalties for all sales of the initial record, as well as radio plays or other use of their work.  This does not happen to many visual artists whose hard work and perseverance benefits only the buyer who owns the original work.

This article only scratches the surface of all the points and suggestions made in the report.  And, this is only a proposal.  If you are a visual artist or member of the art community with an opinion on this issue, you may want to read the full report and then write or call your senator or congressman and let them know your side.

If you find this interesting, please post it to your social networks.  Thanks for all your reading this year and we’ll be back after the New Year.  Enjoy your holidays. 

About the author

Steve Schlackman

As a photographer and Patent Attorney with a background in marketing, Steve has a unique perspective on art and law. Should you have any questions on Intellectual Property contact him at steve@orangenius.com. His photography can be seen online at Fotofilosophy.com or on display at the Emmanuel Fremin Gallery in New York City.

13 Comments

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  • I really don’t see how this relates to socialism; it’s just a matter of fairness and parity for visual artists to receive royalties as well as performing artists; it’s not like we’re all getting rich off the first sales of our works. If an artist objects to it for some reason, I suppose he or she can disclaim any royalties due.

    Since copyright itself is a matter of law, (or “fabricated law” as the post above puts it) it has always been up to politicians and bureaucrats to deal with it and modify it as needed to keep up with current thinking on the matter. The distinction between an “original” and a “copy” is difficult to make in these days when much art is mastered on a computer and the only tangible product is a print. To allege that anyone can do whatever they want with a copy they bought, including presumably to recopy and resell it, but that an “original” is sacred and shouldn’t be bought or sold, seems to be making an artificial distinction where none exists in law or in practice.

    I don’t see how collecting a royalty on resale impinges on any of my artistic freedoms or interferes with my art, but it is accordance with the set of artist’s moral rights that has been fought for over many years and is now embodied in the laws of many countries as well as in international treaties. But maybe that’s because I’m “too stupid to be an Artist” and am doomed to be a “surf” (sic) of the Collective Socialist Conspiracy or whatever…

  • This silly notion, a socialist concept no doubt, that artists are just another cog in the wheel of the establishment, lacking exceptionality and conforming to the delusions of commonality that afflicts the masses under the influence of the Collective Agenda Mindbenders, is offensive to us who exercise Artistic Freedom. The idea here, that artists are a part of the common paradigm and need fabricated laws to direct them to control and therefore gain from their artistic renderings is absurd and insulting. Copyrights have their place and certainly serve the interests of the Artist, the Creator of visual works or otherwise, but any REAL Artist knows that his Works are his to control and manage as he sees fit. The “original” once sold or transferred to another is no longer his but the property of the new owner. Private property rights, no matter how the Socialists attempt to dispense with the concept, the inalienable right, of private property and the rules long established for the protection of private property in the hands of individuals, are the determining factor in who gains from the resale of such property. To put those rights, including copyrights, at risk by placing them and their integrity in the hands of politicians and bureaucrats is fool-hardy at best and ridiculous. The simplest answer to the question of resale of a Work of Art is for the Artist, or his contracted agent, to retain the original and control the reproduction of such an original [making the reproduction a “copy”, hence the concept of “copy”-right]. No laws, certainly no new fabrications, are necessary. The notion, an absurdity in light of the fact that once sold the Work, the original, is no longer the property of the Artist, that the Artist is entitled to “royalties” from the resale of the Work, which is no longer his to control since he SOLD it to someone else and thus relinquished his property rights to that piece, is an affront to any REAL Artist and yet another attempt, by the Socialists, to drag the Artist down to the common status of just another corporate anti-freedom anti-individual surf of the Collective. If I were so foolish as to sell the original and then expect royalties, or gain, when the new OWNER sells HIS property then I am too stupid to be an Artist. Certainly not a REAL one. I suppose if I were that stupid I would expect royalties from every one who just read this “original” rendering of words. MY words! MY original ARTiculations. Fortunately I am a REAL Artist and I know my occupation as well as my natural inalienable rights and understand the Principles of Freedom. I certainly will not tolerate any foolishness from government or misguided Socialist nitwits interfering with my Art. I strongly urge all REAL Artists to oppose this latest bit of nonsense!

  • It’s a bad idea. It is in place here in Australia, and costs more to administer than the measly amount it recovers. Mainly a ‘make work’ scheme for public servants with nothing better to do.

    Philosophically it is a crock anyway. Say I engage an architect to design me a fine building. He does a great job and I end up with a wonderful building that goes up in value. When I ultimately resell it and make a big capital gain, should the architect be paid again for his work? I think not. On the other hand, if someone pinches the architect’s plans and builds a copy, then that is an actionable breach of copyright, and rightly so.

  • This is a fascinating question. I agree an artist should have royalties for their work. But I also see vast complications that can arise. Today, as artists use digital manipulation and special effect programs to create mixed media pieces, can we ask who the actual artist is? Is the program used by the artist only a tool used or does the person who developed the program deserve royalties also because the finished piece could not have been completed without the computer program? This is why I insist my students always use their own photographs when learning how to do copy and grid projects. If they use a magazine photo, the work may be beautiful when completed, but the student cannot claim that it is completely their own. Part of the beauty of the project was completed by another photographer.

    In addition, if an artist enjoys the style of another artist,(for simple example, Picasso cubism), can they claim originality for their cubist piece? The idea of cubism as an approach to visual expression came from Picasso. Should the artist pay royalty to Picasso for use of the style?

    I do believe that when an artist sells his/her finished piece of art, they need need to receive some royalties and protections on the future use of their piece after it has sold. Many artists today have learned the business and law to protect their creations, for example, Thomas Kincaid.

    If one of my pieces provoked media discussion and continual photographed publications in magazines, papers, internet, etc. I would expect to receive royalty, much like music every time it is published as a piece. (After all, don’t we need people to sign permission if their photos or videos are used in publications?) If my art was sold, then sold a second time for use in an ad, (something that was not my original message of the piece) I believe I should have a say in how it is used.

    It is going to get complicated, but that is no reason it should not have the same protections that any product in America has.

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  • This would be amazing if it went into effect.

    (Remember: YOU still have a say in this — contact your senator/congressperson as the author says at the end of the article!)

    For too long visual artists’ creative work has been exploited and this would be a step in the right direction — government overreach aside. It’s just a shame that it would only affect public auction as I would imagine most art “speculators” (collectors and dealers) would simply move their endeavors to the private arena to avoid paying even 5% of the pie to the artist or their estate.

    But perhaps that’s just the jaded artist in me?
    ~Donia
    ethyrical artist

  • I think it is a great initiative. When you consider artists like Vincent Van Gogh who only sold one painting in his life-time and now his work sells for millions or Amadeo Modigliani who lived in misery and whose work became hot items just hours after his death. I sincerely hope that this proposal will be adopted and made a law. This will be a great step forward for visual artists.

  • I am concerned about the Copyright Office getting involved in something that doesn’t involve copyright. (Nothing is being copied.) It’s a clear example of government overreach.

    If an artist wants to make some sort of “royalty” a condition of sale, they can do that. Saying that I, as a potential buyer, have to share any profit with the person who sold something to me is preposterous.

    “why can’t an artist be paid for their work.”

    They have been paid, at a price they obviously agreed to at the time. The question is, why should they be paid again? Why should the person who believed the artists’ work had merit be forced to hand over some of the profits when the artist’s work has increased in value?

    “They equally put in the time and deserve a life they dream of.”

    Ma’am, *no one* “deserves” anything. It’s up to the individual to make the life they dream of, not government interference. If an artist can’t make a living at art, they need to do something until they can. (*If* they ever can.)

    Would it be nice if artists made more? Yes, it would. But “it would be nice” is not a valid reason for enacting new taxes, levies or “royalties”.

    • I agree, you do have a point and the Copyright Office may be overreaching. But let me play devil;’s advocate. I think the idea here is that copyright includes the right to copy, make derivatives and display your work in public. This rule would only apply to public auctions where your work is being displayed and distributed. It doesn’t apply to private sales. At least not at this point. There is also an interest of fairness. It is one of the few arts that don’t have royalties. Music, film, books etc all have royalty systems in place. It’s the nature of the work that makes it more difficult so the copyright office is trying to equalize the art playing field. For instance, you could make royalty a condition of sale. But how do you enforce it. You agreement would be with the original purchaser. Let’s say you sell your painting for $300 with a 10% royalty agreement. They sell the painting for $500 and add the royalty agreement to that sale. the painting changes hands 5 times in the next 10 years. The painting now sells for $100,000. The artist can only sue the original owner, who would now owe $10,000. They would have to sue the person they sold it to and so on. The last person to buy the painting is not responsible to the artist. With this bill, that last sale, assuming it is a public sale, would be responsible for 3-5%. Also, look at the fairness angle as well. Say someone buys your art for $500 to hang in their bedroom. The artists not only spends the next 10 years working hard at his or her craft, but spends enormous amounts of time an energy to build his reputation and business. When the buyer sells the painting for $100,000, they are benefitting from that profit solely due to the effort of the artist, not their own effort. Is it really so harmful to give the artist 5% of that sale.

      Now, that is devils advocate. I have my own concerns about overreach and also the affect on the auction market. Would this just make art sales for at least the more expensive works, stay in private hands? The Warhol that sold for $105 million; would that not have hit the auction market if $5 million had to go to the Warhol Estate? OR would the price have been a lower sale. Or would private sales never get that high? I don’t know the answers but it is something to think about.

      Thanks for your comment.

      • I agree with you in part, in theory.

        But there are creative ways for the artist to “sell” their works that wouldn’t just bind royalties to the first buyer. Right of First Refusal would be one way–that way, the artist is entitled to contract with every future buyer. That would also be fairly straight forward to negotiate.

        Another would be to simply sell a license to display the piece, where the actual ownership remains under the artist’s control. That way, the physical possession would remain with the buyer, but they’d have no right to anything more than possession (much like a piece that’s indefinitely on loan to a museum).

        The simplest option, though, would be to follow in the footsteps of several comic creators (most notably Adam Hughes) and just auction off your work yourself, then sleep comfortably knowing that you got the fair market value for your work & require nothing further. To use your example, I find it hard to find much sympathy for an artist who undervalued their work to the extent that the buyer netted a $999,500 profit.

        Personally, I’m a firm believer in the “first sale doctrine” & its role in royalties. In the other forms of media you mentioned, the artist gets their royalties from the sale to the first owner. After that, with future sales, they’re entitled to nothing, even at auction. Like with those, the artist is getting paid for that first sale. If they want to raise the price so that they also earn a 10% “royalty” on top of the cost, they’re free to do so.

        I also firmly believe in personal responsibility. Just as I said above, I find it difficult to sympathize with an artist who wants things like a percentage of profit from future sales or fair market value for their work, but doesn’t take the steps to contract those things with their buyer.

        Lastly, it is worth remembering that simply buying the physical piece doesn’t include the purchase of any distribution or duplication rights. Those still belong to the artist, who’s free to profit off them with sales of prints or miniatures or whatever the equivalent for their medium is.

  • I love that this is being considered. In fact, I’m a little confused why it took so long for us to get to this place. Nevertheless, I appreciate it is being considered. As a Creativity and Business Coach for artists, I can tell you that this is something that many of them struggle with and it would be nice to know that there are additional protections in place to give them the opportunity to continue to do what they are passionate about. After all, if someone is allowed to make a living as a basketball player or as a veterinarian, why can’t an artist be paid for their work. They equally put in the time and deserve a life they dream of.

    Thank you for publishing this article. I think it is a great way to contribute to the conversation.

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