The problem of inauthenticity and falsification of documents plagues the art world, witnessed in another instance by Nirav Modi’s seized assets. In recent reports, numerous paintings such as works by F.N. Souza owned by Modi were found to be fake and investigators further questioned whether he was involved in proliferating the art market with fakes he often gifted his international clients. The flooding of art markets with ‘fakes’ is indicative of the need for stricter vetting practices due to the large scale of the investment.

Since purchasing artwork is an investment, it requires multiple authentications as well as additional services such as shipping and insurance. Any investment on this scale would be protected by insurance--and artworks are no different. In the case of cross-border art acquisition, there would be additional compliance with shipping regulations. It is also important to insure the artwork to protect it from any unexpected damage. Certain insurance companies also aid with transportation and storage services which are essential for fragile items.

In the absence of legislation, there are contractual remedies that protect a buyer in case of forged and fraudulent artwork. Due diligence practices and the inclusion of rescission clauses in the sale agreement provide an additional layer of security to a buyer as the buyer has the option to avail of a refund for the return of the art piece.

Despite the concerns addressed above, art acquisition may seem to be a risky and cumbersome process and requires a buyer to be vigilant to ensure the origins of an artwork. Similarly, countries all over the world have been working to protect cultural rights. In light of Subhash Kapoor’s fraud, India has been proactive in bringing back antiquities. On 18 October 2022, the US authorities returned antiquities worth $4 million which were illegally exported from India.

In conclusion, the global art market is a complex and ever-changing landscape, and it is important for a buyer to be aware of these challenges and to know that steps can be taken to mitigate the risks involved. This includes not only conducting due diligence on the artwork but also ensuring that the provenance is legitimate and insuring the artwork.

(Roshnek Dhalla is Counsel at Khaitan & Co. The views expressed are personal.)

Cross-border art purchases

Cross-border art purchases: Mind the legalities of importing art into India