APPENDIX 46
Memorandum submitted by TRACE
Mr Richard Ellis, Managing Director, "TRACE".
1989—February 1999, Founder member and
officer I/c The Art and Antiques Unit, Metropolitan Police, New
Scotland Yard.
Experienced investigator of the Illicit Trade
in Cultural Property and of the International Art and Antiques
Market over a 10 year period. Conducted investigations in many
European countries, Egypt, China and the USA. In addition undertook
numerous investigations in the UK in response to requests made
by other countries through Interpol, and was responsible for the
seizure and return of cultural property through the existing legal
process.
A speaker at many international conferences
and seminars on the subject of the Illicit Trade from the perspective
of Law Enforcement, and a member of the Executive Committee of
the Council For The Prevention of Art Theft. Instigator of the
Codes of Due Diligence launched by the Home Office in 1999.
February 1999—February 2000, General Manager
of Christie's Fine Art Security Services.
1 March 2000 appointed Managing Director of
TRACE.
THE IMPACT
OF PRIVATE
SECTOR INITIATIVES
ON THE
ILLICIT TRADE
IN CULTURAL
PROPERTY
1.1 TRACE and its parent company THESAURUS
have now become INVALUABLE. Invaluable provides an indispensable
service to the victims of crime, the police and the Art and Antiques
industry through its unique database and magazine. Working with
the international law enforcement community we are able to circulate
details of stolen art, antiques and cultural property, and to
continuously search for it against the data provided by over 700
auction houses. Together with our extensive web site, we are the
most complete providers of Due Diligence service for the loser,
law enforcement, collector and trade.
1.2 With "Due Diligence" playing
a more significant role on the trading of cultural objects, it
must not be forgotten that there is a requirement for the loser
of such property to complete their Due Diligence, by placing the
information relating to the stolen property into the public domain.
The reporting to a Law Enforcement Agency that the property has
been stolen places an obligation on that agency to circulate the
details of that property to those most likely to come into contact
with it. A failure to complete this circulation will result in
a failure to recover the goods in the event of a dealer/collector
having purchased them, after completing a reasonable process of
due diligence.
1.3 As TRACE, we already work in partnership
with many Law Enforcement Agencies, with Interpol, and directly
with the victims of crime, receiving information concerning stolen
property, which is placed into the TRACE database. This information
is searched daily against the catalogues of 648 auction rooms
based in the UK, America, and Europe. These are scanned onto the
system and searched electronically, enabling us to identify the
stolen property at the point at which it is offered for sale in
the art market.
1.4 We also publish a magazine, which features
crime prevention articles, together with details and images of
stolen, and recovered property. "Invaluable" magazine,
(incorporating TRACE), is circulated to auction rooms, dealers,
law enforcement, and other interested parties. At the present
time 21,000 copies of Invaluable are circulated.
1.5 In addition, the Invaluable website
(www.invaluable.com) provides a further opportunity to circulate
stolen property, and is the major Internet source of information
concerning the art market. The rapid growth in the use of this
particular area of technology is recognised as providing the most
effective means to aid the control of the illicit trade in the
future.
1.6 At the present time, we are working
to provide Law Enforcement Agencies with "online" access
to the stolen database through the use of the Internet. This will
provide police in the United Kingdom with a low cost Nationwide
Database and also create a truly international database for stolen
works of art, antiques and cultural property.
1.7 In an attempt to further assist countries
who suffer from the loss of objects of cultural heritage, and
law enforcement agencies, it is intended to develop a new website
within the Thesaurus domain. This site will provide information
on the laws governing the removal, import and export of a countries
national heritage, provide examples of such items, and give "Help
Line" numbers for further information. Customs Officers and
Police in any country would be able to access this information
24 hours a day, to determine what lawful action they may take
to recover cultural property. At the present time, there is a
complete lack of such information available to customs and police,
who are left to decide on a course of action, which, if incorrect,
could result in serious consequences for the individual and the
service concerned.
1.8 Details of objects actually stolen,
and searched for will be placed onto the Invaluable Stolen Property
database, and be published in the magazine, as at present. The
combination of these two mediums restricts the market place into
which stolen and illicitly obtained objects can be sold. At the
same time, by publishing details of the objects in this way, the
requirements of due diligence are being met on behalf of the losers,
and claims of due diligence checks having been made by suspected
dealers or collectors can be verified.
1.9 The establishment of a "One Stop"
information website will provide another point of reference in
the process of due diligence for the loser countries, dealers
and collectors alike. It will serve as a preventative measure
in the trafficking of cultural property, and heighten the public
awareness in respect of cultural property crimes.
2. THE IMPACT
OF THE
ILLICIT TRADE
IN CULTURAL
PROPERTY
2.1 The impact of this illicit trade on
countries is significant, both in the damage and loss to their
national heritage, and to their economy. I have personally witnessed
the destruction of previously conserved tombs in Egypt, destroyed
by criminals in order to supply the market with "new"
pieces. The similar destruction of sites both known and unknown
is a recurring feature for many countries, including the UK, robbing
the archaeologists and scientists of artefacts, and the tourist
industry of potential revenue. For many countries, the criminal
destruction of these sites in addition to those destroyed by modern
development, accelerating the overall loss of their cultural past
to a dangerous degree.
2.2 The illicit trade in cultural objects
has now reached a level of criminality, which is highly disturbing.
There are clear links to organised crime, and to some extent,
there is evidence that the smuggling operations are conducted
by those also involved in the trafficking of drugs.
2.3 A further negative impact resulting
from this trade and the sale of looted or stolen works is on the
art market itself. There is a belief held in many quarters that
the auction houses and dealers are willing to trade in these artefacts
from which they make substantial profits, whilst turning a blind
eye to their origins. It is further perceived that the British
establishment encourages this trade, at the expense of the loser
countries national heritage. In part, this is due to the differing
legal processes involved but also to the vibrant international
market conducted through London.
3. METHODS OF
COUNTERACTING THE
ILLICIT TRADE
3.1 At the present time the methods of countering
the illicit trade are limited, and the powers used are contained
in our existing domestic law. The role of Customs and Excise is
also limited, because it is not an offence to import into the
United Kingdom, property illegally exported from another. For
countries such as Italy, which have very restrictive laws governing
the export of cultural property, this provides a constant bone
of contention, as they are unable to recover objects which they
consider to have been stolen from their national patrimony.
3.2 Customs and Excise are not empowered
to seize stolen property, this being the role of the police. Cultural
objects can thus be declared to customs at the point of entry
and, provided the correct paperwork is completed and the revenue
paid, the importation is both permitted and legal, notwithstanding
that the objects are stolen.
3.3 Stolen objects present further legal
complications and should be considered in two groups. (a) Objects
stolen from known collections or sites, and (b) Objects stolen
from unknown excavations, which belong to the state by what the
trade refers to as "Nationalisation Laws"—where
a country declares that all antiquities still in the ground are
the property of the state.
3.4 By Sec 24 of the Theft Act 1968, goods
stolen other than in England and Wales, shall be construed as
being stolen property providing that the taking of the property
amounted to a theft in the country in which it was taken. Police
have the power under the Police and Criminal Evidence Act 1984
to seize stolen property and to retain it as evidence or to prevent
its disposal or destruction.
3.5 For objects as at (a) above, stolen
from known collections or sites, the police have the power to
seize and retain them, once evidence has been obtained from the
loser country that the property is indeed stolen.
3.6 For the objects at (b) above, stolen
from unknown sites, proof of their theft from the loser country
is usually impossible to obtain and the UK police are unable to
assist in their recovery.
3.7 Although the provisions of Sec 24 of
the Theft Act 1968 ensure that the property remains "stolen
property", it is often impossible to bring any criminal prosecution
against those in possession of the items. Whilst the offence of
Dishonest Handling under Sec 22 of the Theft Act 1968 may be considered,
if the person in possession of the property took possession of
it beyond the jurisdiction of the United Kingdom, the offence
under English law is deemed to be complete in that jurisdiction.
3.8 In these instances, the loser state
is forced to resort to civil litigation in order to recover its
stolen property. The police service, as holders of the property,
are then involved in the proceedings at a cost in terms of both
time and resources. In recent instances, objects seized in police
operations have been returned to China, (6,000 objects), Egypt
and Turkey.
3.9 In the case of the Chinese objects,
no prosecution could be brought in the UK due to jurisdictional
problems, the suspects having taken possession of them in Hong
Kong, knowing them to be stolen goods. The Chinese Government
declined to litigate as this was seen as placing themselves on
the same level as those they regarded as criminals. Their Lawyers,
(Freshfields), claimed Sovereign State Immunity, forcing those
from whom the antiquities had been seized to negotiate.
3.10 Whilst a successful return of the bulk
of objects seized was achieved, the cost to the police service
for the safe storage of the property was high.
3.11 The Egyptian case received extensive
media coverage and was successful on a number of counts. The UK
police were able to work closely with the museum community both
in England and Egypt, and with the Antiquities Police in Egypt,
through close diplomatic co-operation via the Egyptian Embassy
in London.
3.12 Through such close co-operation, convictions
were obtained against the primary UK organiser in this country,
and against a further 11 people in Egypt. The remarks of the Trial
Judge at Knightsbridge Crown Court were upheld by the Appeal Court
Judges, who stated that there had to be a "deterrent element"
in the sentence passed, (six years imprisonment), in order to
reflect the serious nature of the offence and the importance attached
to it by the UK courts.
3.13 The case is a good illustration of
how the criminal process can provide a deterrent to those who
are engaged in the illicit traffic of cultural property. It is
emphasised that it is only through use of the criminal process,
difficult and complex as it is, that some kind of a deterrent
effect can be achieved against the criminals involved in this
trade. Whilst the UNESCO Agreement, UNIDROIT and The European
Directive on the Return of Cultural Property, provide a mechanism
for the return of the property, none of them have any bearing
on the criminals, or provide any means to bring them before a
court.
3.14 When action was taken against the criminals,
as in the Egyptian case, the adverse publicity, and threat of
further police action, affected the illicit trade at least temporarily.
The climate that resulted in the London antiquities market, together
with the bad publicity generated by the television programme alleging
that Sotheby's had for a number of years assisted in the illicit
traffic, caused that company to close down its London based antiquities
sales, and move them to New York.
3.15 The enactment of Part 1 of the 1993
Criminal Justice Act, enabling the police to seek a prosecution
for a conspiracy to commit offences abroad, is a useful addition
to the legislation available to the police, but there remains
a strong argument for the introduction of a new offence of Dishonesty
Possessing Objects of Cultural Heritage within the Jurisdiction
of the United Kingdom Courts. At the time of the introduction
of The Theft Act of 1968, it was recognised that there had to
be a special section, (Sec 11), covering the removal of objects
from public exhibitions, where there was no intent to permanently
deprive the owner of the property. There is now a need for the
creation of this new section, in order to prevent the British
Art Market being used as a clearing-house for other countries'
stolen property.
4. THE OPERATIONAL
EFFECT OF
EUROPEAN LEGISLATION
4.1 The Return of Cultural Objects Regulations
1994, implements in English Law the European Directive on the
return of cultural objects. Its effect is to place all disputed
claims before the High Court, once again ensuring that there is
no deterrent effect to be gained through the criminal law.
4.2 The law is little used, although it
is difficult to understand why. One possible reason may lie in
the tight definitions laid down as to what objects constitute
a "Cultural Object", and the need for countries to have
listed such objects. A second reason for the legislation not being
made use of rests with the requirement to litigate at considerable
cost. It still remains a cheaper, and quicker option, to pursue
a claim through the criminal code, relying on the police to seize
the property and obtain a "Disclaimer" from the person
in possession of it.
4.3 Countries such as Italy argue that a
court order made by an examining magistrate for the return of
cultural property is binding, even when the property has moved
beyond the jurisdiction of their courts. They do not consider
that they should have to litigate in order to achieve the return
of property already ordered by their own judiciary.
4.4 One aspect that this legislation has
introduced to English Law is the possibility for a "Good
Faith" purchaser to obtain compensation from the requesting
state. This has a significant bearing on the conduct of the trade,
and raises the aspect of "Due Diligence". The requirement
placed on the person in possession of the property to be able
to satisfy the court of their Good Faith at the time of their
acquisition has major implications for the trade.
4.5 Unless the possessor can show that reasonable
due diligence was undertaken, good faith cannot be proved. In
such circumstances, the limitation period will not apply, and
no compensation order will be made in the event that the court
orders the return of the property to the claiming state. (Adrian
Allan Ltd v de Preval and Cobert Finance S A v Federal Republic
of Germany).
4.6 This aspect of the European Directive
is similar to Section 4 of the UNIDROIT Convention, which if ratified
would have even bigger implications for the trade, enabling more
such cases to be brought by non EU countries.
4.7 These implications played a major part
in the legitimate trade bodies working with The Council For The
Prevention of Art Theft in drawing up Codes of Due Diligence for
dealers and auctioneers. It is worth noting, however, that although
the Antiquities Dealers Association were involved throughout in
the drafting of the codes, their membership declined to endorse
and adopt them.
4.8 Whilst the question of the ratification
of the UNIDROIT Convention remains, further European Legislation
seems unlikely. A review of the existing categories and financial
thresholds may result in a greater use of the present Regulations.
5. THE ADVANTAGES/DISADVANTAGES
ETC OF
THE 1995 UNIDROIT CONVENTION,
AND THE
1970 UNESCO CONVENTION
5.1 The United Kingdom has been much criticised
at International Conferences for not having signed the UNESCO
Convention, making it appear harder for countries to seek the
return of their stolen cultural property. The public statements
made with regard to its unlikely implementation, and also that
of the UNIDROIT Convention, have served only to harden the belief
that the UK has no interest in protecting other countries' national
heritage.
5.2 However unfounded these perceptions
may be, they have been encountered at many levels including Government,
Law Enforcement and Academia, generating resentment and ill-feeling
against the UK as a whole.
5.3 There is now a strong argument for the
UK to implement the UNESCO Agreement and to ratify UNIDROIT. One
of the major objections to doing so has historically been the
damage it would cause to the British Art Market and the effect
that it would have upon museum collections.
5.4 The greatest damage to our domestic
art market will continue to be caused by the introduction of European
Taxes. Of the other major art market countries, both France and
the USA have implemented the UNESCO Agreement, whilst at the same
time increasing their market turnover. Neither country has suffered
an "emptying" of their museum collections, and both
have benefited in terms of the esteem in which loser countries
hold them.
5.5 The UNIDROIT Convention includes those
elements already contained in the European Directive, with the
added benefit of creating a "cut off" time period beyond
which claims for the return of property would not be valid. (Article
3).
5.6 The model implemented by the USA has
clearly protected its market and museum interests, whilst responding
to particular international requests for assistance with the introduction
of legislation banning the importation into the US of specific
categories of artefacts.
5.7 The UK is clearly out of step with world
thinking at the present time, but I believe the introduction of
at least the UNESCO Agreement in the manner in which it was implemented
by the USA would help the UK to regain its position as a respected
and responsible major player in the international art market.
5.8 An added benefit to the implementation
of the agreement would be in the increased opportunities to recover
artefacts stolen from our own national heritage.
6. CONCLUSIONS
A better control of the illicit trade in cultural
property would be achieved by:
6.1 Ensuring details of the stolen objects
are entered onto the Invaluable stolen property database, and
actively searched for against the details of auctions and dealers
stock.
6.2 Develop an exchange of information on
the laws controlling the theft and illicit traffic in objects
of cultural heritage, through the use of the Invaluable website,
and magazine.
6.3 A review of the United Kingdom's laws
to enhance the ability of law enforcement and customs, to police
the illicit trade within the UK, and by creating a deterrent effect
on those engaged in this trade.
6.4 A review of the UNESCO and UNIDROIT
agreements, leading to their adoption within the UK laws, creating
an internationally accepted civil law remedy for the return of
cultural property whilst compensating the genuine good faith purchaser.
6.5 The development of "Best Practice"
within the licit trade through a greater use of the codes of due
diligence, and a review of other measures including the registration
of dealers and the feasibility of "passports" for classes
of objects.
6.6 The establishment of an International
Review Committee to look at the specific case of looted Second
World War art.
April 2000
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