China Guardian seeks to ensure quality in art-auction business

Updated: 2015-07-10 10:54

By Jack Freifelder in New York(China Daily USA)

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As the global art auction industry adjusts to an influx of dollars and interest from new buyers around the world, there is an urgent need to ensure quality and consistency in the auction process, said Hu Yanyan, director and president of the China Guardian auction house.

"These years, more and more Chinese buyers are choosing to buy collections abroad," Hu said. "The reason why they make this choice is that they think they will find a platform with higher credibility abroad, a platform where everyone pays for what they bid.

"Since the founding of China Guardian more than 20 years ago, we have stuck to the idea of being a fair and transparent art trade platform," she told China Daily. "To protect collectors and buyers' rights, China Guardian has relied on many experts. The hope is that honesty in deals and improvements to marketing endeavors will make the market healthier in the future."

China Guardian's 2015 Spring Auctions concluded with a total of 1.87 billion yuan ($301.2 million) in sales. The auction featured pieces across six categories: Chinese painting and calligraphy; 20th century and contemporary art; porcelain works; furniture; manuscripts; and stamps and coins.

Beijing-based China Guardian, which was founded in 1993, reported total sales of 5.09 billion yuan ($819.9 million) in 2014, a drop of 22.3 percent compared to the full-year total for 2013. The auction house sold more than 23,400 items during that period.

China is the world's second-largest art market, handling 22 percent of the global trade volume in 2015, according to the TEFAF Art Market Report. China and the United Kingdom (22 percent, respectively) trail only the US (39 percent), data from TEFAF's report showed.

Since the Chinese government lifted restrictions on the sale of cultural relics in the 1990s, the less than 20-year history of art auctioning in China has not produced established collections that are attractive to the collecting public. As such, new collectors often need to rely on auction houses' expertise on appraisals.

China Guardian does not purchase and resell art works; rather, it generates revenue exclusively from its commission fees on transactions.

"That's how we build trust," said Hu, who still makes personal visits to deal with individual collectors. "It's little by little."

China Guardian pays close attention to Sotheby's and Christie's, monitoring the auctions of the two giant houses.

New technology has had a "great impact" on the auction process, Hu said.

"For the 2015 spring auction, the session Fine and Rare Wines of the World launched an online bidding system combining both online and offline bidding," Hu said. "The technology is harder than purely allowing online bidding, but under the support of our technology team, we achieved the idea in only half a year."

The auction house began allowing clients to auction online simultaneously with offline participants in May.

"All of this of course is in a bid to make the collections more valuable," Hu said. "On the other hand, we need to deepen the service. What the Chinese auction industry should do is to learn from Western industry. We need to communicate more with Western friends."

She believes China Guardian needs to transform because more and more young Chinese and Western collectors are entering the market.

"In the past, we only looked for sellers to China, but now we are also looking for buyers overseas," Hu said. "The clients overseas will test you, and they at least have the basic knowledge. And if they love Chinese art, they will have their own opinion."

For years, payment issues have plagued Chinese auction houses, and they drew attention as China overtook the US as the world's biggest auction market for fine art in 2010.

"The auction industry is facing a big obstacle - market credibility," Hu said. "And it's mainly because of the nonpayment issue. After rapid growth in the Chinese art market for seven to eight years, there are inevitably problems as a result of the fierce competition."

 China Guardian seeks to ensure quality in art-auction business

China Guardian advocates credibility in art auctions as the market becomes more global. A painting is displayed at a China Guardian auction in Beijing in 2012. Provided to China Daily

(China Daily USA 07/10/2015 page2)