After years of waiting - it has finally arrived.

As of 1 December, the long-discussed Artist Resale Royalty Scheme has come into effect.

It's a step towards ensuring artists can be fairly compensated for their work as it rises in value - they will now officially receive royalty payments from art sold on the secondary art market. 

There are many who have championed this scheme's arrival as crucial and a game-changer, while others have criticised it for not going far enough - calling it a "token gesture."  

What is the Resale Royalties Scheme?

The scheme was first announced in August 2022, with then-Minister for Arts, Culture and Heritage Carmel Sepuloni noting "This is about fairness...Beyond the monetary acknowledgement, this is confirmation for artists that they have rights, and their cultural and societal contribution is valued.”

It's led to the creation of the Resale Right for Visual Artists Act 2023 and the Resale Right for Visual Artists Regulations 2024. 

The Scheme also meets New Zealand’s obligations under the Free Trade Agreements with the United Kingdom and European Union. Over 30 OECD countries are involved, including Australia – where a similar scheme has been operating since 2010 and has generated over $14 million in royalties and benefitted more than 2,700 artists (Resale Royalty, 2023).   

Current Minister of Trade Todd McClay notes “The Resale Royalties Scheme brings New Zealand in line with global standards to ensure artists are fairly compensated when their work is resold. It means New Zealand art sold here and overseas will return a payment to our artists.

“It strengthens our commitment to fair trade practices made in our agreements with the UK and EU. And importantly, it enhances the reputation of New Zealand’s creative sector and promotes the value of our cultural exports.”

How does it work?

To be eligible, artists need to be a citizen or a resident of New Zealand or a New Zealand citizen domiciled in a reciprocating country.

In the case of artists who are now deceased, they need to have fit the above criteria at their time of death to qualify.

Each time an artwork is resold in the secondary arts market that reached the $2000 (excluding GST) threshold, a royalty of 5% is paid. Using that price as an example, the royalty would be $100.

The contract for the resale must be entered into on or after the commencement date of the Act (1 December, 2024). The sale must be a “Professional Resale” or a “Voluntary Qualifying Resale”.   

The royalties are gathered by Resale Royalties Aotearoa Toi Huarau - a non-profit subsidiary of long-time royalties advocated Copyright Licensing New Zealand (CLNZ), who were appointed as the official collection agency of the scheme in June this year. 

The organisation will retain up to 1% of the resale value to fund the collection, distribution, and other functions associated with the scheme.  

Sam Irvine, Chief Executive of Resale Royalties Aotearoa and CLNZ states “This scheme supports the longevity of New Zealand artists’ careers and enables them to continue producing artwork for the benefit of society.

“The long-term sustainability of our arts and cultural sector is essential not only for preserving our heritage but also for fostering innovation and creativity that drive New Zealand's future.”  

What is the reaction?

Some artists The Big Idea has spoken to feel this is a major win for artists, who have for too long lost out as their mahi grows in (financial) worth.

But there are others who feel that it won't make much of a difference, as one declared "so many artists would struggle to see their work sell for that price - it doesn't change things for is...maybe for our distant relatives in many years from now, if we're lucky."

Leigh Melville, MD of Art+ Object gallery was one of the first in Aoteatoa to get onboard with the concept of rewarding artists beyond the initial sale of their mahi, signing on for CLNZ's auction house licensing scheme back in 2021.  

Melville explains her support of the freshly started scheme to The Big Idea.

"I work in the arts industry, have friends and family who are artists and I understand the sacrifice and challenge of pursuing an artistic career.  This legislation may help to make life a bit easier for some.  Personally, I feel a big sense of responsibility to make sure the scheme is adopted with as little interruption as possible, while also making sure that everyone understands their obligations.

"The major positive is obviously that artists will get paid.  Unclaimed funds will accumulate and hopefully they will be distributed to support worthwhile artistic causes."

There's also other galleries who aren't happy about the new scheme, shaving money off of their margins and concerning growing it might make New Zealand art less attractive in their eyes.

Melville continues "New Zealand has a small and vibrant art scene.  We have a solid contemporary art auction market that raises the visibility of contemporary art and provides a space where people can sell art if they choose to. 

"This royalty may disincentivise people to collect art, which would be a very unfortunate side effect.  The royalty will also, in large part, benefit those who are already successful and/or their estates.  I would still like to see a cap (or maximum amount payable) applied at the top end of the scheme."

What do artists need to do?

Essentially, you need to register, which you can do on the Resale Royalties website.

If you are a visual artist who sells their work - or the successor to one - you need to be registered with Resale Royalties Aotearoa so they can track you down for payment.  

Irvine says the collection agency is calling on emerging and established visual artists and their successors, Art Market Professionals, art buyers and collectors, and GLAM (galleries, libraries, archives and museums) professionals to join the registry, which you can do here.