Christie’s International held it first auction in mainland China on September 26, at the new Shanghai Free Trade Zone. Sales totaled 168,883,500 (CNY), including Buyer’s Premium.
Bloomberg reports that the small sale is more of a test run for bigger and better things. The auction contained just 42 lots, a hodge podge of art, jewelry, and wine. “They have to sell something, so they put together a loose group of things,” said James Hennessy, a Hong Kong-based dealer. “They have to get in there and start doing something on the promise and hope they will be able to sell Chinese antiques eventually.”
Currently, foreign companies are barred from selling cultural relics in China. The porcelains, paintings, and ceramics that raised $418 million at Christie’s Hong Kong auction in May were not offered. Instead, there was a mix of Andy Warhol art, Patek Philippe watches, a Picasso, and bottles of Chateau Latour. By hosting the auction inside the Shanghai Free Trade Zone, Christie’s was able to import the items without paying the usual taxes and fees. However, buyers will have to pay to take their items to other parts of China.
“We are happy to operate here without the freedom to sell those cultural relics,” said Christie’s chief executive Steven Murphy, “The fact that it is not open now is not preventing us from moving ahead, because there is a great deal of art to sell and people to be in touch with.” With the ban on selling cultural items in place, the auction is as much a networking and marketing event as anything.
Christie’s main competitor, Sotheby’s, is also interested in holding future auctions in China. Last September, Sotheby’s announced a $1.2 million investment into a joint-venture auction company. They now own 80 percent of it, with state-owned Beijing Gehua Cultural Development Group claiming the other 20 percent. “With that surge in volume of business from China I decided it was time to go into China and not wait for the law to change,” said Kevin Ching, Sotheby’s Asia CEO.
It is clear, however, that buyers prefer to attend auctions in Hong Kong. “A lot of the big players want to come to Hong Kong because it’s a more level playing field, the market here is more transparent, and the bidders in the room are more diverse,” said Hennessy, “The mainland has a long way to go to catch up to Hong Kong.”