Security Over Art: An Introduction

A number of particular issues and difficulties arise in taking security over art as opposed to other assets. This briefing paper is a general introduction to the subject, and highlights some traps for the unwary.

Key Points

1. in addition to the valuation of the art, due diligence will include issues such as provenance, title, export licences, and a search of the Art Loss Register
2. if the art work is pre 1945, changed hands in the years before or during the second world war and was at this time in Germany or other occupied territories, it is necessary to consider the risk of a holocaust restitution claim
3. where security over art is given by an individual, the Bills of Sale Acts 1878-1882 (the "Acts") mean that it is usually impracticable to take a mortgage or charge