HMRC’s message to Art Market Participants: Key changes in the updated BAMF Guidance (2022)

September 21, 2022
by ArtAML™ Team

The British Art Market Federation (“BAMF”) Guidance was updated for UK Art Market Participants (“AMPs”) on 30th June 2022. HM Revenue & Customs (“HMRC”) as regulator sent an email update with key changes to AMP businesses registered for supervision.

The list of those changes is copied below and several points are expanded upon below the list.

Please note that ArtAML™ has identified two differing points to the updated Guidance as being fundamental to Customer Due Diligence (“CDD”) for AMPs. That article is provided below under ‘Further reading’.

Download the BAMF Guidance here and discover details referenced in HMRC’s list, using provided reference points.

Key changes include:
the need for risk assessments and policies, controls, and procedures to be written (see part 1, paragraph 2)
defining an intermediary (see part 1, paragraphs 13 to 16)
online independent sales platform (see part 1, paragraphs 14 to 16)
clarity on introducers, framers, and shippers (see part 1, paragraphs 17 to 18)
artist’s obligations (see part 1, paragraph 19)
rental of art (see part 1, paragraph 20)
what is a ‘work of art’, updated to remove conceptual works of art (see part 1, paragraph 21)
non-UK AMPs carrying on business in the UK (see part 1, paragraphs 34 to 35)
clarity on Customer Due Diligence (CDD) obligations (see part 1, paragraphs 53 to 60 and part 2, section 5)
non-disclosure agreements (see part 2, paragraph 5.31)
updated electronic verification (see part 2, paragraph 5.32 onwards)
public Register of Authentic identity and travel Documents (see part 2, paragraph 5.81)
clarity on reliance (see part 2, paragraph 5.194 onwards)

Insight into several points above:

Risk Assessment & Policy.
It is now explicit that not only must AMP businesses have these in place, but that they need to be refreshed at minimum once per annum.

Exclusion of artists.
This is confirmed in the Guidance (regardless of the artist being a sole trader or company). Note that legal language is used for this point, so it is not easy reading.

Rental of art:
This can be caught if at the end of the rental period, the art will become the property of the renter. Therefore, it is vital to establish what the total value will be upfront, in addition to title being transferred at the end. If title is to change and the amount is 10k+ EUR, CDD would need to be conducted prior to commencing the business relationship.

Further reading:
What all UK Art Market Participants need to know about the updated BAMF Guidance (2022)

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