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South Korea’s Galleries Association Held Its Own Auction to Warn Auction Houses

The Galleries Association of Korea issued a statement on January 3 and held its first auction on January 26  as a protest against Seoul Auction and K Auction, South Korea’s two largest art auction houses. The association alleged that the two auction houses violated their gentlemen’s agreement and that they were only following the “market’s logic.”

Photo by Tamara Gak on Unsplash.

In 2007, a gentlemen’s agreement was made between the Galleries Association and the two auction houses to share in the growth of the overheating art market. The agreement included certain requirements for the auction companies, such as holding a maximum of four major auctions a year, submitting artworks more than two to three years from their creation date, and excluding directly purchased artworks from the artists in auctions.

The Korea Art Price Appraisal Association reported that the nation’s eight auction houses held 255 auctions and sold 329.4 billion KRW (US $277 million) worth of artworks last year, compared with 115.3 billion KRW in 2020.

Seoul Auction and K Auction held four to six major auctions annually before 2021. But as the local art market showed rapid growth last year, they held auctions almost every month. Seoul Auction achieved a record sales of about 166.6 billion KRW, while K Auction recorded 136 billion KRW, accounting for over 90% of the local art auction market.

© Galleries Association of Korea.

“We have been told that the auction houses are asking some artists to sell their works directly to them, as there are not enough artworks to be put up for auction due to the recent surge in demand,” the Galleries Association said, claiming that the two local giants are dominating the nation’s art market.

The association argued that such actions disrupt the sustainable growth of the local market, and further explained that the “gentlemen’s agreement” exists because Korea went through a similar market boom in 2007 and has witnessed a number of artists disappear after the boom ended.

Countering these claims, the auction houses reportedly argued that the issue of auctioning artworks purchased directly from the artists is exaggerated and only relevant in a few cases with young and underrepresented artists. 

They also argued that it is unfair to ask the auction houses to follow an agreement that was made 15 years ago and that no longer applies to the current market situation.

© Seoul Auction.

As Korea has recently emerged as an attractive art market, increasing attention from the world, an international media outlet mentioned regarding this current situation in Korea that the sudden international interest and the sharp expansion of the Korean art market can be a cause of concern, especially for emerging artists.

The report referred to the Galleries Association’s opinion that now is the time to seek sustainable growth by strengthening and expanding the base of the Korean art market, where young and emerging local artists can have opportunities to develop their career in both the local and global art world rather than simply acting according to market logic.

© K Auction.

As a gesture to raise awareness of the current art market issues, the Galleries Association held an auction on January 26. The auction was limited to its members and did not publish the sale’s consignments. 

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