Sale of goods or property in public to the highest bidder. There are usually conditions of sale by which all bidders are bound. Long-established world auctioneers are Christie's and Sotheby's. The Internet-based eBay, founded in 1995, is a global online auction site.
A bid may be withdrawn at any time before the auctioneer brings down the hammer, and the seller is likewise entitled to withdraw any lot before the hammer falls. It is illegal for the seller or anyone on their behalf to make a bid for their own goods unless their right to do so has been reserved and notified before the sale. Christie's New York chairman, Donald Bathurst, resigned after he was found to have falsely stated that some paintings had been sold, a practice known as ‘buying-in’. ‘Rings’ of dealers agreeing to keep prices down are illegal. A reserve price is kept secret, but an upset price (the minimum price fixed for the property offered) is made public before the sale. An auction where property is first offered at a high price and gradually reduced until a bid is received is known as a Dutch auction.
In 1988, art auctioneers (handling not only pictures, but other items of value such as furniture) were required by a British judge's ruling to recognize the possibility of the item being of great value, and to carry out ‘proper research’ on their provenance.
Sotheby's suspended some of its senior staff members in 1997 following allegations of involvement in smuggling Italian art treasures. The allegations were made in a television documentary programme and Sotheby's announced they were launching a full internal review of their practices. The accusations came at a time when British auction houses were facing three new areas of legislation: droit de suite - a levy on contemporary art sales; unidroit, a treaty which returns ‘stolen’ goods; and the imposition of value added tax on art imports into the EU after 1999.
Christie's, established in 1766, was sold in 1998 to François Pinault, a French billionaire.
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