Washington, D.C. — American University International Law Review has published Volume 35, Issue 2. This issue discusses timely subjects including trademark law, youth justice, and the hallmark Academy on Human Rights and Humanitarian Human Rights Award. Issue 2 is available for PDF download here.
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MAKING THE CASE FOR AMAZON
Kaylynn Noethlich*
“The Case Against Amazon” is a familiar phrase that dominates headlines and underpins popular political platforms.[i] Yet, not long ago, and arguably still today, Amazon was the poster child of consumer benefits – consistently bringing more products at lower prices through innovative delivery methods to consumers across the globe. Above all else, Amazon’s marketplace gave consumers unprecedented choice. Today, consumers are frequently presented with over 10,000 options when ordering a product — spanning across brands, prices, and colors — when previously they had to choose from the select few a store carried.[ii]
Despite the benefits consumers continue to enjoy from using Amazon’s marketplace, antitrust authorities in the U.S. and the E.U. have publicly opened investigations into the company.[iii] Both countries’ authorities traditionally use the “consumer welfare” standard when evaluating the competitive harm in a marketplace — meaning the focus is on the ultimate harm and loss of welfare to consumers, not competitors.[iv] Thus, the announcement of an investigation into Amazon immediately raised the question — are consumers really being harmed?
According to the European Commission (E.C.), its investigation targets the standard agreements between Amazon and marketplace sellers with a focus on whether Amazon misuses third-party seller data from its marketplace to negatively impact competition.[v] Essentially, the E.C. alleges that Amazon collects large quantities of data on its marketplace enabling it to predict which products are in high demand. Because Amazon is both a retailer (it sells its own products on the marketplace) and the owner of the marketplace, Amazon has the ability to use its data analysis to create products that perform well, sell them at a lower price, and ultimately drive out any competitors.[vi] Unlike the E.C., U.S. antitrust authorities do not publicly reveal reasons for their investigations. However, experts contend that the U.S. Federal Trade Commission is investigating under a similar theory.[vii]
Although politicians, investigators, and reporters appear united in making the case against Amazon, this article makes the case for Amazon.[viii]
Amazon does not have the requisite monopoly power.
Both the U.S. and the E.U. have laws preventing the abuse of a dominant position in a given marketplace. In order to have a “dominant position” in a market, a company typically must comprise at least 30% – 40% of the relevant market and have monopolistic power that is “durable rather than fleeting.”[ix]
There are many alternative sources for the products that Amazon sells, for instance Walmart. Indeed, Walmart’s lower prices and wider range of products was once viewed as the end of small business.[x] Although public perception often paints Amazon as the biggest retailer player today, Walmart is still more than double Amazon’s size as a general retailer.[xi] Numerous other retailers dwarf Amazon in discrete product categories in which Amazon competes. Even on its own marketplace, Amazon has been surpassed by third-party retailers which account for approximately 58% of Amazon’s retail unit sales.[xii]
Although it can be argued Amazon’s position in particular retail categories, such as books, music, and videos, meets the level of monopolistic power, Amazon operating as a general retailer on its marketplace alongside third-party retailers does not.[xiii]
Amazon is not raising rivals’ costs by denying access to an “essential facility.”
Amazon operates as an open marketplace to large and small retailers alike. Amazon developed a standard pricing model to access its marketplace — for low volume sellers Amazon receives $0.99 for each product sold and professional sellers pay $39.99 a month, both responsible for any selling fees.[xiv] Amazon allows third-party retailers to compete in various product categories, some requiring approval (such as refurbished products), not singling out product markets Amazon most successfully competes in.[xv] The exception to this rule includes: (1) items often counterfeited; (2) items easily stolen from retail stores; (3) brands that do not want the perceived value decreased; and (4) brands sold exclusively elsewhere.[xvi] Additionally, when a seller (or rival) is removed, Amazon provides the seller 30-days-notice for removing the seller along with a formal reason explaining the removal.[xvii]
Moreover, 80% of Amazon merchants also sell their products through other channels, including Walmart, retailer owned websites, eBay, Jet, and other brick-and-mortar stores.[xviii] Amazon represents only a single platform among a multitude available to professional sellers, not a singular controlled essential facility.
Even if Amazon did deny access to an “essential facility” they do not have power over price.
Amazon offers private label products within its marketplace at a lower price, as many retailers often do.[xix] Grocery stores typically carry store-branded products, similar to how pharmacies carry generic medication identical to popular brands. Offering private label products to match branded products is not a new phenomenon. Moreover, offering private label products at lower prices and with better shelf placement is commonplace.[xx]
To make a convincing argument that Amazon has power over price one would need to promulgate the specious theory that private-label products have power over branded-product pricing. Private label products typically peg prices to a non-public percentage of branded products (e.g., CVS selling its private-label goods at a 30% mark-down compared to branded drugs). Because companies rarely advertise their private-label products and have complete control over shelf-placement, it allows them to sell these products at a lower price than branded products. Additionally, consumers will often fall into the categories of “price sensitive” or “non-price sensitive” and “brand sensitive” or “non-brand sensitive.” These categories allow both brands and private-label products to successfully sell at different price points.[xxi] This is Amazon’s marketplace strategy.
Even if none of the above is true, Amazon offers immense benefits to consumers and there is no harm.
U.S. and E.U. antitrust laws diverge on this point. If Amazon possesses a “dominant position” in the E.U., it has a “special responsibility” to “ensure that its conduct does not distort competition.”[xxii] Meaning, if any of the above is true, then Amazon’s consumer benefits likely will not offset its special responsibility in the marketplace because of distortions to competition through increased costs to rivals.[xxiii]
Although no “special responsibility” exists in U.S. antitrust law, a dominant player merely has a duty not to abuse their dominant position, which results in a determinant to the competitive marketplace and ultimately consumers. Pinpointing the ultimate harm to consumers proves difficult because Amazon provides its customers with a wide array of choice, quality, prices, and innovative delivery methods. Concluding Amazon violated antitrust laws would likely require antitrust authorities to look beyond the traditional consumer welfare standard and create uncertainty moving forward for companies facing antitrust scrutiny.
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* J.D. Candidate, May 2020, American University Washington College of Law; B.B.A., Economics, 2017, Drake University. Kaylynn Noethlich previously worked at the Department of Justice Antitrust Division and the Federal Trade Commission as a legal intern, in addition to Freshfields Bruckhaus Deringer as a summer associate in their Antitrust & Competition group in London and D.C.
[i] See generally Simon Van Dorpe, The Case Against Amazon, POLITICO (Mar. 4, 2019, 1:14 AM CET), https://www.politico.eu/article/amazon-europe-competition-giveth-and-amazon-taketh-away/ (discussing the EC’s investigation in Amazon’s agreements with retailers); Jack Kelly, Senator Elizabeth Warren Says ‘It’s Time To Break Up Amazon, Google And Facebook’— And Facebook CEO Mark Zuckerberg Fights Back, Forbes (Oct. 2, 2019, 10:43 AM), https://www.forbes.com/sites/jackkelly/2019/10/02/senator-elizabeth-warren-says-its-time-to-break-up-amazon-google-and-facebook-and-facebook-ceo-mark-zuckerberg-fights-back/#456a1cef6791 (highlighting presidential candidate Elizabeth Warren’s position on “big tech”); Madeleine Joung, Google, Amazon, Facebook and Apple Could Face Antitrust Investigations. How Do Those Work?, Time: Politics (June 5, 2019), https://time.com/5601245/google-amazon-facebook-apple-antitrust/ (comparing today’s antitrust investigations to the 2000 Microsoft era cases); see also Lina M. Khan, Amazon’s Antitrust Paradox, 126 Yale L. J. 710 (2016) (arguing the current antitrust framework is unequipped to handle the competition challenges in the modern economy).
[ii] See, e.g., Search Results from Amazon for a “Suitcase,” Amazon Italy, http://www.amazon.it (type in general search bar “suitcase”; then look to the left of the page above the products listings to see the number of search results); Search Results from Amazon for a “Suitcase,” Amazon United States, http://www.amazon.com (type in general search bar “carry-on suitcase”; then look to the left of the page above the products listings to see the number of search results).
[iii] Eur. Comm’n Press Release IP/19/4291, Antitrust: Commission opens investigation into possible anti-competitive conduct of Amazon (July 17, 2019), https://europa.eu/rapid/press-release_IP-19-4291_en.htm.
[iv] See Svend Albæk, Consumer Welfare in EU Competition Policy, in Aims and Values in Competition Policy 67, 68 (Ulla Neergaard & Christian Bergqvist eds., 2013), https://ec.europa.eu/dgs/competition/economist/consumer_welfare_2013_en.pdf (“Vice-President Almunia said in a speech shortly after he was nominated commissioner in charge of competition policy that ‘[a]ll of us here today know very well what our ultimate objective is: Competition policy is a tool at the service of consumers. Consumer welfare is at the heart of our policy and its achievement drives our priorities and guides our decisions.”); Russell Pittman, Consumer Surplus as the Appropriate Standard for Antitrust Enforcement, Economic Analysis Group Discussion Paper, June 2017, https://www.justice.gov/sites/default/files/atr/legacy/2007/09/28/225696.pdf.
[v] Eur. Comm’n Press Release IP/19/4291, Antitrust: Commission opens investigation into possible anti-competitive conduct of Amazon (July 17, 2019), https://europa.eu/rapid/press-release_IP-19-4291_en.htm.
[vi] Hypothetical example: Amazon sees a spike in demand for Swell water bottles. It then creates a nearly identical version of the water bottle and sells it under a private label brand at a much lower price, hoping consumers switch from Swell water bottles and start buying Amazon’s private label product.
[vii] Samuel R. Miller, Is Amazon Violating the Antitrust Laws?, Verdict: Justia (July 25, 2019), https://verdict.justia.com/2019/07/25/is-amazon-violating-the-antitrust-laws.
[viii] Although there are several theories of harm surrounding multiple Amazon practices, this article will only focus on the allegations of Amazon’s misuse of third-party retailer data.
[ix] U.S. Dep’t of Justice, Competition and Monopoly: Single-Firm Conduct Under Section 2 of the Sherman Act, at 5 (2008), https://www.justice.gov/sites/default/files/atr/legacy/2008/09/12/236681_chapter1.pdf (“Section 2 of the Sherman Act makes it unlawful for any person to “monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations . . . .”); Eur. Comm’n, Competition: Antitrust Procedures in Abuse of Dominance (July 2013), https://ec.europa.eu/competition/publications/factsheets/antitrust_procedures_102_en.pdf (“Article 102 of the Treaty on the Functioning of the European Union (TFEU) prohibits abusive conduct by companies that have a dominant position on a particular market.”).
[x] Kate Taylor, Walmart Destroyed Retail, Bus. Insider (Aug. 15, 2016, 10:25 PM), https://www.businessinsider.com/walmart-destroyed-retail-2016-8?IR=T.
[xi] See Amazon vs Walmart – Revenues and Profits Comparison 1999-2018, MGM Research (2018), https://mgmresearch.com/amazon-vs-walmart-revenues-and-profits-comparison-1999-2018/ (reporting $514 billion in revenue for Walmart and $233 billion for Amazon in 2018).
[xii] Andrew Martins, Amazon Announces Changes for Third-Party Sellers in Response to EU Oversight Threat, Bus News Daily: Tech. (July 17, 2019, 1:05 PM), https://www.businessnewsdaily.com/15212-amazon-changes-for-third-party-sellers.html.
[xiii] See Matt Day & Jackie Gu, The Enormous Numbers Behind Amazon’s Market Reach, Bloomberg (Mar. 27, 2019), https://www.bloomberg.com/graphics/2019-amazon-reach-across-markets/ (reporting Amazon’s e-commerce market share in the category of “books, music, video” is 80%); see also Marc Bain, Amazon’s unruly third-party marketplace now sells more stuff than Amazon itself, Quartz: Letters from Bezos (Apr. 19, 2018), https://qz.com/1256651/amazon-marketplace-sold-more-stuff-than-amazon-itself-in-2017/ (noting more than half of the products sold on Amazon’s marketplace are now third-party retailers).
[xiv] Sell on Amazon: Benefits, Amazon Services (last visited Oct. 25, 2019) https://services.amazon.com/selling/benefits.html.
[xv] Sell on Amazon: Categories, Amazon Services (last visited Oct. 25, 2019), https://services.amazon.com/services/soa-approval-category.html.
[xvi] The Known Brands That Are Not Allowed to be Sold by Amazon Third Party Sellers, The Selling Family (last visited Oct. 20, 2019), https://thesellingfamily.com/the-known-brands-that-are-not-allowed-to-be-sold-by-amazon-third-party-sellers/.
[xvii] Andrew Martins, Amazon Announces Changes for Third-Party Sellers in Response to EU Oversight Threat, Bus News Daily: Tech. (July 17, 2019, 1:05 PM), https://www.businessnewsdaily.com/15212-amazon-changes-for-third-party-sellers.html.
[xviii] Rani Molla & Jason Del Rey, A Fifth of Professional Amazon Merchants Sell More Than $1 Million a Year – Double The Share from Last Year, Vox: Recode (May 23, 2018, 4:02 PM), https://www.vox.com/2018/5/23/17380088/amazon-sellers-survey-third-party-marketplace-walmart-ebay.
[xix] Simon Van Dorpe, The Case Against Amazon, POLITICO (Mar. 4, 2019, 1:14 AM CET), https://www.politico.eu/article/amazon-europe-competition-giveth-and-amazon-taketh-away/.
[xx] Private Label Manufacturers Association International Council, World of Private Label: Industry News (2019), https://www.plmainternational.com/industry-news/private-label-today (outlining the growth of market share for private-label products).
[xxi] John Quelch & David Harding, Brands Versus Private Labels: Fighting to Win, Harv. Bus. Rev.: Marketing (Jan. 1996), https://hbr.org/1996/01/brands-versus-private-labels-fighting-to-win (claiming manufacturers of brand-name products can temper any challenge posed by private-label goods).
[xxii] Eur. Comm’n, Competition: Antitrust Procedures in Abuse of Dominance (July 2013), https://ec.europa.eu/competition/publications/factsheets/antitrust_procedures_102_en.pdf (“Article 102 of the Treaty on the Functioning of the European Union (TFEU) prohibits abusive conduct by companies that have a dominant position on a particular market.”).
[xxiii] Id.
By Nick Laneville
November 1, 2016
Throughout his campaign to be the next President of the United States, Donald Trump has expressed a range of views on foreign policy. Issues that have been particularly pronounced in his rhetoric in this area are those of collective security, immigration, and trade. This blog post will attempt to explain his positions on those issues, and, where possible, envisage the outcomes of his policy decisions if they were to be enacted.
Collective security
Donald Trump has expressed serious discontent with the manner in which the United States and its allies orchestrate collective security. Particularly, he takes issue with the way in which the North Atlantic Treaty Organization (NATO) is run. He contends that the United States pays far more than its share while other members unfairly enjoy the fruits of the United States acting as the “policemen of the world.” In the first presidential debate, he noted that the United States “pay[s] approximately 73 percent of the cost of NATO,” and he submits further that too few of the 28 member states spend the requisite 2% of GDP on defense.
His position is that “[t]he countries [that the United States is] defending must pay for the cost of this defense – and, if not, the U.S. must be prepared to let these countries defend themselves.” The removal of U.S. support from nations that are allegedly not paying their share could indeed incentivize them to change course and begin upholding their obligation to spend on defense. However, such removal could mean a bleak and short future for NATO. If the United States, as the strongest military power in NATO, refuses to honor its obligation under Article 5 of the Washington Treaty which essentially commits it and all of the other members to collective self-defense should an armed conflict break out, then the credibility and force of the Organization will take a serious hit. The looming threat of an expansionist Russia, bordered by small (and in this hypothetical scenario, former) unprotected NATO members such as Estonia, could indeed lead to some tense diplomatic situations if collective security is disrupted.
Immigration
The full extent of Donald Trump’s immigration plan is beyond the scope of this post, but certain aspects of his plan do have effects on foreign policy, so those are addressed here. Perhaps the flagship policy of Donald Trump’s campaign has been “The Wall” that he intends to build along the southern boarder of the United States, and, unsurprisingly, this is likely the policy that would have the greatest impact on foreign relations and policy.
Particularly, the means by which Trump intends to pressure Mexico into paying for the wall may have an impact on United States-Mexican relations (and others). To that end, he has suggested the promulgation of a proposed rule under the Patriot Act which would limit the ability of Mexicans to transfer funds to Mexico from the United States. The rule would require aliens wishing to wire money outside of the United States to affirmatively prove by relevant documentation that they are in the United States legally. Because Mexico receives, approximately $24 billion USD per year in remittances from Mexican nationals living abroad, “the majority of that amount com[ing] from illegal aliens,” Mexico will want to avoid the enactment of this rule which would curb the flow of these remittances. The United States will then offer to not enact the rule in exchange for Mexico paying the $5-$10 billion USD to build the wall.
This plan is a difficult one to square with law as it stands in the United States. First, Trump’s proposed interpretation of the text of the Patriot Act would likely be subject to controversy and litigation. His proposal necessitates an expansion of the definition of the term “account” in the Patriot Act to include wire transfers, while the text expressly carves wire transfers out of that definition, holding that “Account does not include: (A) A product or service where a formal banking relationship is not established with a person, such as check cashing[ or] wire transfer[.]” Expanding that definition would likely require legislative action, which would, at the very least, delay this program.
Secondly, the impact of forcing aliens to prove that they are in the United States legally before they can transfer money abroad will not only impact Mexicans and Mexico. The proposed ruling will impact all aliens wishing to transfer funds, which could have a dilatory and negative impact on individuals and businesses that operate in the United States, but do not have United States citizenship.
Trade
Trump has stated that China is one of the United States’ primary adversaries in trade, frequently accusing it of unfair trade practices which harm domestic markets and industries. He has suggested that a means by which to change the dynamic of the United States’ trade relationship with China would be to impose (or at least threaten to impose) steep tariffs on China. This, however, would not be a tenable approach as it is a clear violation of Article I:1 of the General Agreement on Tariffs and Trade (“GATT”). He has also suggested that China is unfairly subsidizing its exports to the United States and dumping goods, which could be grounds for the legal imposition of higher tariffs on Chinese products assuming a finding by the relevant agencies that China is either engaging in unfair trade practices or that its actions are causing injury to the domestic market.
An alternative route that Mr. Trump has proposed is to pull out of the World Trade Organization altogether. While this would permit him to raise tariffs on China, this would also have some other rather catastrophic effects on American and global trade. It would mean a rescission of the covered agreements and all of the benefits that accompany those including the low tariffs that the United States benefits from through the GATT and the General Agreement on Trade in Services. It would require a renegotiation of tariff levels through free trade agreements with all of the members of the WTO whom the United States does not already have agreements with, and even some of the nations with whom it does have agreements. Extracting the United States from the World Trade Organization would be like the Brexit, but far more complex and with fewer benefits.
Donald Trump has consistently disparaged the trade agreements that the United States is party to, and has said that he will change the commitments that the United States has made under those. What is unclear is how, and to what extent he intends to do that. In Gettysburg, Pennsylvania on October 22, he proclaimed that every single United States trade agreement will be unwound if he is President, but again, it is unclear to what extent those will be “unwound.” A complete overhaul of all trade agreements would be quite an undertaking, and its outcome would be impossible to determine at this juncture.
(Nick Laneville is the Senior Articles Editor for Volume 32 of the American University International Law Review.)
By Ayat Mujais (@Ayat_Mujais)
October 31, 2016
Numerous individuals, and much of the media, call Hillary Clinton a foreign policy “hawk.” In general, Clinton often supports the use force along with using diplomacy and negotiation tactics, often called “s
mart power.” She has a record of endorsing new wars, and can be seen as confrontational or an interventionist when it comes to foreign policy issues. She has a wealth of knowledge from her background as a Senator and as Secretary of State, which many say may assist the US in being more successful in global conflicts. But what are the specifics of her foreign policy? How will her policies affect international relations? These are important questions that this post will address.
China
Clinton’s policy on China is split – she is tough in most her policy stances, yet still wants to increase cooperation with the Chinese. In terms of positive policies, Clinton is poised to continue President Obama’s “pivot” to Asia. Clinton wants to reinforce US allies in Asia-Pacific and increase cooperation in common interest areas. However, Clinton has a long record of rhetoric against China that has caused tensions with Chinese officials. She has a strong and critical stance against China’s human rights record, which she has often spoke openly about, to the frustration of Chinese officials. Moreover, she is against China’s push into the South China Sea, and has called for increased deterrence against Chinese cyber-attacks.
Secretary Clinton’s policy on China will certainly affect US-Chinese international relations. Some experts have said that Clinton needs to be “cautious and pragmatic” in her approach, since China is critical for the economy and world order in general. Her policy on speaking out against China’s human right’s record and push into the South China Sea have already raised tensions among Chinese officials. The Chinese view Clinton as an interference in their goals towards the South China Sea and other geopolitical aspirations. Clinton has stated that although dynamics between the US and China are challenging, she believes they are positive. It is yet to be seen if her foreign policy will continue that positive relationship, or create problems down the road, although many think that relations will become turbulent.
The Middle East
Islamic State in the Levant
Secretary Clinton has a three-part strategy to combating terrorism, particularly against ISIL. First, she wants to defeat ISIL in the Middle East, specifically in Syria and Iraq. Second, she wants to dismantle the infrastructure that provides and facilitates a flow of fighters, arms, and propaganda to terrorist groups. Finally, she wants to increase US and US Allies’ defenses against external and homegrown terrorist threats.
In regards to ISIL, Clinton plans to fight them with the aid of a coalition of other Western and Arab states, establish a no fly zone and refugee exclusion zone over parts of Syria, and strengthen Arab fighters on the ground. In tandem with conducting more US air strikes and the limited use of armed drone strikes, Clinton thinks it is critical to support and arm Sunni and Kurdish fighters already in Syria to build local capacity. Her policy also includes strengthening intelligence through close regional partnerships to stop the flow of foreign fighters. Finally, Clinton believes the US needs to play a bigger role in resolving the humanitarian crisis.
Many believe that if Hillary Clinton becomes President, she will have a more active role in the Middle East and increase the potential for interventions. This seems apparent from Clinton’s push to Congress to update the Authorization to Use Military Force. What can be called her “militaristic” positions are concerning for other states. Her policy may also heighten tensions between the US and Russia and the US and Iran, particularly her position on establishing a no fly zone in Syria. Some experts have stated that her decision making is “flawed,” mainly because of her commitment to intervention and to changing regimes or political processes in the Middle East.
Iran
Hillary Clinton has a strict policy towards Iran. Her policy includes imposing sanctions on Iran for failure to comply, as Iran continues violating UN Security Council resolutions through their testing of ballistic missiles. Clinton wants Iran to abide by the multinational nuclear deal that was established, which she supported. She also wants to increase the costs on Iran for its “destabilizing behaviors” throughout the Middle East. Particularly, Clinton wants to counter Iran’s influence over groups such as Hezbollah in Lebanon and Hamas in Palestine.
Although US-Iranian relations have been normalizing as of late, there are still many issues between the two nations, not only ideologically but with policies regarding Syria and Yemen. Many hope that the recent dialogues and engagement between the two nations will continue, which seems most likely under a Clinton administration, although perhaps not as much as some would like. Clinton has stated that she is willing to take military action if Iran breaks from the nuclear deal, which certainly does not sit well with Iranian officials. US-Iranian relations will depend on how much cooperation and dialogue Clinton will pursue as president.
Israel
Similar to most US Presidents, Secretary Clinton has been friendly with Israel throughout her political career. Clinton’s foreign policy towards Israel is to maintain Israel’s military superiority in the region. She wants to remain a partner with Israel in terms of joint efforts in the region, including intelligence. In general, Clinton wants to reaffirm her bond with Israeli Prime Minister Benjamin Netanyahu should she become president.
This policy will likely strengthen international relations between the US and Israel. A poll shows that 68% of Israelis view Clinton favorably, compared to 43% for Trump. However, only 32% of Israelis think that Clinton will get along better with Netanyahu as compared to Trump. Some critics believe that international relations may falter between the two states due to Clinton’s record of “unconditional support” to Israel, and that her previous lack of criticism could create tensions if she is forced to criticize in her role as President.
Russia
Considering current events, relations between the US and Russia are tense. Obama has notably been tough on Russia in his policy stances, and Clinton seems poised to continue down that path as well. Clinton seeks to increase sanctions against Russia due to its intervention in Ukraine. Secretary Clinton will raise the cost of Russian aggression, both financially and politically. Clinton’s Russian policy includes countering Russian aggression by strengthening the European Reassurance Initiative, permanently placing more allied troops and weapons throughout Eastern Europe. Clinton will further expand US missile defenses in Eastern Europe, adding to the political and military consequences of Russia’s recent actions.
Clinton’s policy is unlikely to better US-Russian relations should she become President. Clinton has called Putin a “bully” in the past, so personal relations between the two are already tense. It is clear that Putin prefers Trump over Clinton. Therefore, Clinton’s foreign policy will likely have a negative effect on international relations with Russia.
National Security
Clinton’s foreign policy regarding national security both increases and decreases national security mechanisms. On one hand, Clinton’s policy includes maintaining current restrictions on NSA surveillance, closing Guantanamo Bay, and prohibiting the use of harsh interrogation techniques. On the other hand, Clinton’s policy will increase screening of individuals traveling to states that have issues with terrorism, strengthen US military alliances, and build a global counterterrorism infrastructure.
Clinton’s policy also leaves the US within NATO. Clinton has praised existing alliances within NATO, and thinks that the US should continue to strengthen our allies as it supports US interests, both with our European allies and opposition to Russian expansion. In Clinton’s view, NATO partnerships makes the US stronger globally, and may assist with US regional tactics, such as the potential no fly zone in Syria. This policy will certainly strengthen US-EU ties.
Regarding US international relations, Clinton’s foreign policy on national security will likely strengthen many of our relationships, particularly with our European allies. Most of the EU favors Clinton, although there have been some doubts. Clinton’s national security, for the most part, may assuage these doubts. Clinton would further encourage EU allies to be responsible for their own security by exchanging US commitments for EU commitments, which will probably have strong effect one way or the other. However, Clinton’s policies, particularly regarding NATO, will likely further increase tensions with Russia, as US participation in NATO prevents increase in Russian empowerment and expansion in Eastern Europe.
Trade, Climate, and Energy
In line with most politicians, Clinton wants to ensure that the US in engaged in free trade agreements that create more jobs in the US. This is one of the reasons she is opposed to the TPP, and supports the export-import bank. Additionally, Clinton will likely follow Obama’s climate policies; now that the US has signed the Paris Agreement, Clinton wants to ensure that the US abides by this agreement through limiting global carbon emissions. Moreover, Clinton wants to expand US investment in renewable energy and ban drilling for oil in the US arctic region. Finally, Clinton’s policy includes the continued blocking of attempts by TransCanada to construct the Keystone XL pipeline.
Clinton’s foreign policy on trade and climate will likely have both positive and negative effects on international relations. On a positive note, continuing to adhere to the Paris Agreement and serve as a leader for combating climate change will sit favorably with other nations who have ratified the agreement. However, her policy to prevent the construction of TransCanada’s Keystone XL pipeline may cause slight tensions with Canada, although nothing that can’t be overcome. Further, her opposition to the TPP blindsided states in the region, particularly US allies, and has undoubtedly raised concerns among them on the impact of this opposition.
(Ayat Mujais is an Associate Executive Editor on Volume 32 of the American University International Law Review.)
By Kimberly Reynolds
October 21, 2016
During the 2016 International Law Review Symposium, five esteemed practitioners discussed the complexities that inundate the use of children in armed conflict.
The targeted use of children in armed conflict has become a commonplace and redundant narrative for non-state armed groups. The targeting and use have expanded beyond the “traditional” scope for use of children in combat situations. Thus, a new definition of children in armed conflict has been authored to broaden the protection afforded by the international community. Today, this definition extends to attacks on schools by extremist groups, where recently, more than 1,000 children were abducted by the Islamic State (IS) in Iraq and Syria. Further, it has been compounded by instances of sexual violence reported by foreign keepers.
Jo Baker of Human Rights Watch, discussed the complexity that this issue fabricates for States and the international community. Recently, she has participated alongside the United Nations (UN) Security Council with investigations in Burma, Nepal, Sri Lanka, and Uganda. She discussed the all too frequent trend of IS recruiting school girls across the globe, from Denver, Colorado to London, England. The story is the same: school girls ages 15-16 are solicited by members of IS, primarily by way of money, prestige, indoctrination, and force. To this day, it is unknown how many children have joined IS. It has been reported that the Islamic State is using child soldiers as reinforcements in Al-Hasakah. Despite that the protection of child soldiers is an almost universally accepted human right, children remain tactic targets for several terrorist and military groups.
Rachel Stone, of the Stimson Center, discussed the linkage between weapons and child soldiers. Not only are child soldiers tragic victims of war, they are also recognized as lethal weapons by armed groups. Because they use smaller , it is easier for children to transport, use and acquire these weapons. The link between availability of weapons and child soldiers has been recognized for years, and many countries have taken steps to address this connection. Despite the efforts taken by many countries, the link between weapon supplies from one country, to the proliferation of child soldiers in another, still exist: China to Sudan, Germany and France to the DRC, and US military assistance through arms and training.
The US has attempted to address this problem through the Child Soldier Prevention Act of 2008. This Act requires annual tracking of the use of child soldiers and the compilation of a list countries that use child soldiers. The countries on this list are prevented from receiving any military aid from the US. This prohibition extends to international educational training (grants from foreign governments to come to the US and other counties to get military training), foreign military financing (tax payer money to buy weapons), sales completed by US weapons manufacturers, and excess defense spending.
However, the Act does not apply under Section 1206 of the National Defense Authorization Act. This allows the Secretary of Defense to train and equip groups in foreign defense against terrorists and terrorist groups. It also does not apply to the Peace Keeping Operations Fund, which is not supported through the UN. Lastly, governments can receive otherwise prohibited weapons if they are using those weapons for professional military purposes and are taking reasonable steps, such as action plans, to stop the use of children in armed conflict.
The Child Soldier Prevention Act is not meant to be punitive, but rather to incentivize countries to abandon the use of child soldiers in order to receive military assistance from the US. However, under the Act, the President can waive the prohibition on the premise of “national interest.” The Obama administration has used this waiver 22 out of 30 times. In 2015 alone, the President employed national interest waivers for four of the eight governments that are on the watch list: the Democratic Republic of Congo, Nigeria, South Sudan, and Somalia. Currently, there is $130 million in assistance flowing to Somalia and Sudan. Yemen did not receive a waiver, but the caveat was that assistance would continue if conditions changed. In the end, $1 billion has been authorized to countries that use child soldiers.
Another case is that of Afghanistan. There are two main forces: national and local police. The local police are set up, funded, and supported almost entirely by the US government. So one must ask the question, why is the US funding of local Afghani police forces not taken into consideration by the US government? The answer to this remains unclear. The US government does not recognize Afghanistan’s local police as an armed force under the definition provided in the Optional Protocol, so it does not fit into their definition of the Act. Thus, it is important that the definition recognized in the Optional Protocol include local forces in order to close this loophole.
Child Soldiers International, an organization that works to prevent the recruitment of children in armed conflict, lists parties who use children in armed conflict in annual accounts. Charu Lata Hogg, the group’s Policy and Advocacy Director, points out that of the 57 parties listed, 49 non-state parties are armed groups. The challenge of non-state armed groups is that they are complex, difficult to access, have different ideological motives from that of States, and they are not as engaged with the international community. These factors mean that the international community has limited leverage and access. Child Soldiers International reports on what is happening within the armed groups, and if any progress has been made with best practices. Ms. Lata Hogg believes the only way to engage these groups are to bring all the mechanisms and beams of commitment together, because they do not work on their own.
Last year, Child Soldiers International worked on Operation Protective Edge Israel. They campaigned systematically with the UN Secretary’s Office, documented all violations that Israeli forces had committed, and compiled them into the UN system. However, support from the Secretary General was turned down, likely due to politics.
Notwithstanding the challenges facing the international community in enforcing this right, there are four avenues that have aided in the reduction of Child Soldiers: (1) Engagement with the UN Security Council; (2) the use of the International Criminal Court (ICC); (3) increased bilateral engagement; and (4) ending wars.
First, as Sharon Riggle, the Chief of Office for the United Nations Office of the Special Representatives of the Secretary General for Children and Armed Conflict (UN SRSG) states, the UN Security Council has been much more engaged. This engagement followed the realization that children were slipping through the cracks and were not being protected by the international community. Following Resolution 1261, child soldiers were named as a peace and security issue, and the Security Council has made it a greater priority. As a result, the UN has been directly negotiating action plans with countries to end the use of Child Soldiers.
Action plans function by placing countries on a watch list. A country is placed on a watch list when they trigger any of the following six factors: (1) recruitment and use of children for armed conflict, (2) killing and maiming, (3) rape and other sexual violence, (4) abductions, (5) attacks on schools and other centralized and regularly occurring violence, and (6) denial of humanitarian access. After they are reported by the UN Human Rights Assembly, the UN Security Council engages directly with governments and special groups to create action plans. This can involve closing gaps in legislation which permit use of child soldiers. This is a way to stop and prevent the use of child soldiers, rather than just pointing a finger. There is often political interest of the signatory party which is sustained by high level UN and third party engagement. This also gives the Council direct access to senior leadership. Today, the UN has successfully implemented nine action plans and those countries no longer use child soldiers.
Now, unlike twenty years ago, there are international criminal prosecutions for those who are caught using child soldiers. The International Criminal Court (ICC) convicted their first war criminal, Thomas Lubanga of Sierra Leone, on the use of child soldiers. As these convictions become better known, commanders have expressed fear of being indicted. This fear illustrates how the success of the ICC convictions could be a powerful deterrent.
Third, there has been increased bilateral engagement. One example is financial assistance, which is twofold. Following the end of the war in Sierra Leone, the United Kingdom provided the nation with 10 million pounds for assistance contingent on the suspension of use of child soldiers. However, following funding, civil defense forces alerted the UK of the continued use of child soldiers. Following this notification, the UK made sure the use of child soldiers was stopped before they continued funding.
Lastly, ending the wars themselves would create the largest drop in the use of Child Soldiers.
Although these avenues have provided some relief and progress, challenges still remain. First, for both governments and armed groups, the use of child soldiers still outweighs the risks. Second, efforts to address extremism by armed conflicts actually creates detention of children. Thus, some children conclude that they might as well join in order to get protection. For children who do come out of it, there are reintegration challenges as they often leave ostracized and without skills as occurred in Iraq, Sudan, and Syria. Third, many extremist groups have little interest in a relationship with the UN and possess little concern for a dialogue or international opinion. Thus, the international community has an abundance of tools, yet they are not being utilized as well as they should be.
As discussed by all four panelists, the issues surrounding the use of children in armed conflicts are complex and intertwined with international politics and business, by way of the international arms trade. International legal tools such as laws from various States, international mandates, international courts, and recognition from the international community have all aided in slowing and shrinking the use of children in armed conflict. However, more transparency, cooperation, openness, and coordination between groups is needed to halt the oppressive use of children as tactical aids in armed conflicts altogether.
(Kimberly Reynolds is the Symposium Editor for Volume 32 of the American University International Law Review.)
By: Yvonne Woldeab*
A Tale of Two Churches. Thomas Kline shared two parallel stories of precious lost and found (or more accurately, looted and recovered) artworks that have shaped the international art law landscape today. Both stories are set in Cyprus—one in the village of Lysi, and the other in the northern town of Lythrankomi.
The Greek Orthodox sanctuary in Lysi displayed two incredible 800-year-old frescoes in the church’s dome. In Lythrankomi, the Church of the Panagia Kanakaria housed beloved Byzantine mosaics that had adorned the church’s walls and apse since the sixth century.
In the summer of 1974, the Turkish army invaded Cyprus. In the years following the invasion, Turks looted both the Greek Orthodox church in Lysi, and Panagia Kanakaria, as well as many other churches and homes, and took the treasured frescoes and mosaics.
Lysi. Bandits reportedly used a chainsaw to slice the two ancient frescoes out of the dome of the Greek Orthodox church into thirty-eight separate pieces, and later shipped them to Germany.
In Munich, a Turkish dealer attempted to sell the frescoes to Dominique de Menil, a noted art collector, patron, and world-class Byzantine art specialist. The Turkish dealer claimed the frescoes were found in a private home in the Anatolian region of Turkey. As the article recounted:
De Menil, standing in a warehouse in front of a set of chopped-up 13th-century frescoes, was pretty sure she knew better.
De Menil told the Turkish dealer she wanted to take pictures of the frescoes to look at while she pondered her decision to buy. But that was a trick; instead her researchers painstakingly tracked the frescoes back to Cyprus. It took more than a year.
De Menil contacted the archbishop responsible for the looted chapel, offering to ransom the frescoes from the so-called “owners” and then restore them — at a cost of more than $1 million. In return, she wanted to display them in Houston for a while before repatriating them.
From 1997 to 2012, the frescoes were on display in Houston in a $4 million chapel built especially for them. Finally, in March 2012, the frescoes were returned to Cyprus.
Lythrankomi. In 1988, over a decade after the Turks took the Byzantine mosaics from Panagia Kanakaria, an American art dealer discovered four rare Byzantine mosaics, each a two by two foot square panel. According to their accompanying documentation, these mosaics were legally exported out of Cyprus.
The art dealer purchased the mosaics for over $1 million and shipped the art to Indiana. From there, she attempted to sell the panels for over $20 million to the Getty Museum in Malibu, California. However, Getty’s curator of antiquities recognized the Byzantine pieces, and notified Cypriot authorities that the famous missing artworks had resurfaced.
Within months, the Autocephalous Greek Orthodox Church of Cyprus and the Republic of Cyprus initiated a lawsuit in the U.S. District Court of Indiana to recover the art.[i]
The District Court found that the “discovery rule” applied, which prevented the statute of limitations from running until the Church knew or reasonably should have known who possessed the mosaics. Because the Church had been diligent in attempting to locate and recover the art over the years, the court concluded that the lawsuit was timely.
The case also presented a significant legal question regarding the conflict of laws. If U.S. law applied, proper title would not pass with the theft. The American purchaser would have only received a voidable title, which would be revoked if the works were later found to be stolen, or the seller did not have a legal right to sell it. In contrast, under Swiss law, the American purchaser would have good title, and any claim of theft would have to be pursued against the person who sold the piece to the American, and not the innocent American purchaser.
Ultimately, the District Court found that U.S. law applied, and ordered that the mosaics be returned to Cyprus. The Court of Appeals for the Seventh Circuit affirmed the decision.
The decision, Thomas Kline noted, helped set forth tangible good faith standards in art market transactions. Moreover, foreign governments have responded to looting of cultural property with proactive and creative agreements, such as the loan negotiated for the Lysi frescoes. In exchange for restoring and preparing to repatriate the frescoes, Cyprus permitted the pieces to be displayed in Houston for fifteen years for all visitors to see and share in the enchantment of its ancient beauty, just as art is meant to be.
[i] Autocephalous Greek-Orthodox Church v. Goldberg, Civ. No. 89-304-C (D. IN) (Aug. 3, 1989).
*The author is a Junior Staffer for Volume 30 of the American University International Law Review writing as a part of our series recapping our February 2015 Symposium: Protecting Art and Cultural Property Through International Law at ASIL
By: Jessica Gicherman*
Speakers:
Moderator:
David W. Bowker, Partner, WilmerHale LLP, and Adjunct Professor, Georgetown Law
This incredible panel focused on the issues of art restitution and repatriation, and UNESCO’s 1970 Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property. This Convention requires State Parties to return stolen cultural property imported into their country to the state of origin. The panel also addressed the issue of provenance, and how different institutions combat fakes and forgeries in the international art world.
The first speaker was Gary Vikan, an internationally known medieval scholar and a former Director of Walters Art Museum. After the fall of Iraq, Mr. Vikan joined a panel that reformulated how the possession of antiquities would be handled. Based on this experience, he illustrated the importance of transparency and good faith engagement when handling antiquities. He opined that nowadays museum directors are terrified of making antiquities purchases given the risk it presents, but also encouraged the museum community to change its behavioral guidelines to check the veracity of an artistic work’s title.
The second speaker was Jane C. Milosch, Director of the Provenance Research Initiative in the Office of the Under Secretary for History, Art, and Culture at the Smithsonian Institution in Washington, DC. Ms. Milosch discussed the issue of provenance, which is a record of ownership of a work of art or an antique, used as a guide to assess authenticity or quality. She observed that problems that arise when certain pieces of art that the Smithsonian acquires lack provenance. The museum is then faced with the task of determining if the piece is a fake, a forgery, or stolen. Ms. Milosch, whose focus is on Nazi-looted art, commented on the Washington Conference Principles on Nazi-Confiscated Art, which encouraged museums around the world to ensure that all objects created before 1846, and acquired after that date, have established ownership or provenance. She then detailed the ongoing provenance process at the Smithsonian, and described the different resources her office uses to establish the history and ownership of the museum’s pieces. She noted that museums usually try to formulate groupings to save time and resources while conducting provenance research. The Smithsonian itself developed an online public database that enables museums from around the world to access the information, and add more information to the database when possible. Ms. Milosch stressed that museums must keep a systematic way of establishing provenance, and work with one another because provenance research cannot be done in isolation. There are multiple experts with different pieces of information that have more value when brought together. She concluded that provenance research has become more challenging as resources diminish, which emphasizes the need for collaboration between curators and museums.
The third speaker, Frank K. Lord, is a member of Herrick, Feinstein LLP’s Art Law practice group, and represents collectors, art dealers, claimants, auction houses, and museums in matters relating to art and cultural property law. One of his most notable ongoing cases is his work with Marei von Saher—the heir of Dutch art dealer Jacques Goudstikker—who is pursuing the recovery of hundreds of artworks that the Nazis seized during World War II. The investigations began in 1997, when the Dutch government, with pressure from the U.S. government, began examining all of its collections. Journalist Peter Van Hollander brought the issue to the forefront when he received a tip from someone in the finance industry that the way the Dutch collections were managed after the war was problematic. Eventually, Peter and Marei von Saher were able to make a claim, pursuant to the Washington Principles. The Dutch government formed a restitution committee, the sole function of which was to analyze the pieces in the government’s possession, and review their origins. After a year of investigation, the committee apologized to Ms. von Saher for the way the government handled the pieces, and held that the forced sale of her husband’s works to the Nazis should never have been considered an involuntary transaction. The Dutch government also apologized to the family and restituted around 200 artworks. Von Saher is now pursuing a claim in the U.S. Federal Court for the Central District of California for the recovery of Cranach the Elder’s Adam and Eve, located at the Norton Simon Museum of Art in Pasadena, California.
The last speaker was Colette Loll, who is the founder and director of Art Fraud Insights, a consultancy specializing in art fraud-related lectures, training and specialized investigation of artworks. Ms. Loll has been involved in several independent projects related to the topic of fine art forgery and art forensics, including participating in documentary film projects, and serving as the lead researcher in attribution and authentication investigations. Ms. Loll highlighted the issue of how fakes and forgeries affect the essence of the creative process, and public access to this process. She noted that authenticity is at the heart of a museum’s mission, and forgers who distort the artistic record of pieces have breached the public’s concept of originality. The art community—scholars, curators, dealers— have proven to be a forger’s best ally because forgers use a number of confidence tricks that take advantage of the enthusiasm and wishful thinking of those in the art trade. Forgers are quick to act on the gap that exists when demand exceeds supply, and prey on the collectors eagerness to purchase a piece from an artistic master. As art prices continue to soar, dealers and collectors want assurances that the relevant pieces are authentic. Ms. Loll concluded that the process of authentication is in need of a paradigm shift that will merge art and science, and, consequently, democratize the attribution process.
*The author is a Junior Staffer for Volume 30 of the American University International Law Review writing as a part of our series recapping our February 2015 Symposium: Protecting Art and Cultural Property Through International Law at ASIL
By: R. Carter Parét*
Distinguished Professor Patty Gerstenblith, of DePaul University, delivered a comprehensive and exciting opening keynote address to a packed house of mostly practitioners, students, and American Society of International Law (“ASIL”) members at ASIL’s Tiller House. Prof. Gerstenblith discussed the relationship between looting and armed conflict, specifically the legal safeguards in place to address the issue.
First, Prof. Gerstenblith outlined the current international legal framework protecting cultural property during armed conflict. Currently cultural property is protected by a duality of regimes, first under the 1954 Hague Convention, and second, the four Geneva Conventions applicable in armed conflicts. The 1954 Hague Convention creates an obligation on states parties to safeguard cultural property within their borders against the foreseeable effects of an armed conflict. Moreover, the Convention prohibits the export of cultural property from occupied territories. Another important outcome of the Convention is the creation of the International Committee of the Blue Shield. Prof. Gerstenblith noted that the Blue Shield is the cultural property equivalent of the Red Cross and marks protected cultural sites in armed conflict areas.
Second, Prof. Gerstenblith discussed the problem of looting during armed conflict, commenting that it is carried out on a large scale for economic gain. But the goal of the 1954 Hague Convention and other international agreements is to reduce the economic incentive to loot. Prof. Gerstenblith walked the audience through case studies of looted sites across Peru, Turkey, the U.S., Iraq, Syria, and Egypt. In addition to destroying cultural heritage and sites of significance, looting removes an item out of its context, making it hard to determine the authentication, history, and significance of the looted item. However, Prof. Gerstenblith noted a positive development in the law on two fronts. First, countries are beginning to pass foreign national ownership laws, whereby the host state owns all the items still in the ground. Moreover, foreign national ownership laws make it a crime to remove cultural property or archaeological items from a site without permission. Second, the 1970 UNESCO Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property prohibits the import, export, or transfer of ownership of cultural property. Additionally, the 1970 UNESCO Convention requires state parties to take necessary measures to prevent museums from acquiring cultural property that was illegally exported.
Third, Prof. Gerstenblith succinctly demonstrated the greater issue at hand, using the conflict in Syria as an example. Five out of the six World Heritage Sites in Syria have been damaged as a result of the conflict itself, and twelve sites on the Tentative World Heritage List have been subject to looting. Using before and after images, Prof. Gerstenblith demonstrated the true problem these sites face. The convergence of poverty, a failing state, and armed conflict provide the “perfect storm” for looting.
Ultimately, Prof. Gerstenblith left the audience with four parting thoughts on current and proposed efforts to improve the protection of cultural property. First, the International Criminal Tribunal for the Former Yugoslavia has recognized that the destruction of cultural property goes together with human killing. Second, military necessity under international humanitarian law allows for too much destruction, and must be reworked. Third, protections against looting in armed conflict, enumerated in the 1954 Hague Convention and the 1970 UNESCO Convention, should be unified under one treaty. Finally, the protection of cultural property should be a human and civil right under international human rights law.
*The author is the Deputy Symposium Editor for Volume 30 of the American University International Law Review writing as a part of our series recapping our February 2015 Symposium: Protecting Art and Cultural Property Through International Law at ASIL
By: Alejandra Aramayo & Reema Taneja*
Speakers:
Moderator:
Peter Jaszi, Professor of Law, American University Washington College of Law
Many countries, particularly in the European Union, have adopted resale royalty rights. However, to this day, the United States has failed to implement them into federal legislation; despite the fact that in the last twenty years, U.S. courts have addressed the doctrine at the state level. In an attempt to combat this issue, speakers in Panel one evaluated the implementation of resale of royalty rights in various countries and assessed whether the United States should follow suit.
Resale royalty rights, also known as droit de suite, originated in France in 1889. They enable visual artists to benefit from the increased value of their works over time by granting them a percentage of the proceeds each time their work is sold at auction. The average royalty rate is three to five percent and is capped for each sale made. Irina Tarsis emphasized that many heirs have benefitted from resale royalty rights as over seventy countries have implemented legislation providing for such rights. She observed that these countries have had a positive experience. For example, despite United Kingdom legislation enforcing these rights, sales in London have reached record numbers. Similarly, France has a number of societies in the country that collect the dues owed to artists for the resale of their works. However, Lisa Jones noted that the maximum royalties an artist in the European Union can receive for the resale of his or her work is 12,500 euros. To shed light on the relationship between this cap and value of the pieces, she explained, for instance, that Andy Warhol, whose Triple Elvis was sold at Christie’s New York for $81.9 million, would only receive 12,500 euros for the resale.
Ms. Tarsis observed that while the United States Constitution permits laws granting artists certain rights, this country currently does not provide for resale royalty rights. While the U.S. is a party to the Berne Convention for the Protection of Literary and Artistic Works, which grants these rights, the U.S.’s obligations under that convention are optional and reciprocal. Kevin Amer highlighted that this means American artists do not recoup royalties for the resale of their works, even when the works are sold in countries providing for resale of royalty rights.
The current status of the resale royalty rights in the U.S. is murky. California passed a resale royalty rights law in 1976, but the Ninth Circuit struck it down as unconstitutional because it violated the commerce clause. The case is pending appeal. As both Mr. Amer and Ms. Tarsis noted, the U.S. Copyright Office, published a report in 1992 recommending against resale royalty rights because of concerns over the negative effect they would have on the secondary art market in the U.S. Its follow-up report in 2013 suggested that the rights’ benefits on artists was not conclusive, and would only affect a small number of established artists. Auction houses have vehemently spoken out against resale royalty rights.
Despite these developments, all three speakers recommended that the U.S. consider implementing resale royalty rights at the federal level. Mr. Amer noted that the number of countries with similar legislation has doubled in the past several years, and suggested that Congress may wish to consider granting resale royalty rights to artists to eliminate this disparity. Ms. Tarsis observed that there are an equal number of people supporting and rejecting a federal law providing for resale of royalty rights. She emphasized, however, that while U.S. auction houses are fighting against these rights, the artists themselves are not united. She opined that the artists must come together because they are the ones that would benefit from the proposed legislation. Ms. Jones observed that artists should be allowed resale royalty rights to protect the reputation and the value of their work, especially given the high prices at which some of their pieces can sell for at auction. She further highlighted that although the maximum royalties received for an artist’s work is capped, receiving some money is better than not receiving anything at all. However, she did note that a buyer collecting the works of a mid-range artist might not be willing to bid high amounts for the artist’s pieces at auction.
*Both of the authors are junior staffers for Volume 30 of the American University International Law Review writing as a part of our series recapping our February 2015 Symposium: Protecting Art and Cultural Property Through International Law at ASIL
By: Merve Stolzman
On Wednesday, February 18, 2015, the American University International Law Review (“AUILR”), together with the American University Intellectual Property Brief, the American Society of International Law (“ASIL”) Cultural Heritage and the Arts Interest Group, and Center for Art Law, hosted a symposium titled “Protecting Art and Cultural Property Through International Law” at ASIL’s Washington, D.C. headquarters at Tillar House. The various issues discussed at the event had as their stimulus the strong belief that art and cultural property have a tremendous value to many different actors. In particular, the discussions focused on how comparative and international law could help to preserve this value. As the Washington College of Law’s (“WCL”) Dean Claudio Grossman explained, “The passion, values, and emotions that go into art are worthy of protection.”
Artists often see their work as an expression of their thoughts, feelings, creativity and personality. Understandably, they therefore wish for better rights to protect their work and reputation. Unlike writers or musicians, artists in the U.S. do not receive royalties when their work is re-sold. The U.S. is a signatory to the Berne Convention for the Protection of Literary and Artistic Works, which provides for such rights. However, unlike seventy of its counterparts, predominantly in Europe, the U.S. has not chosen to implement this aspect of the Convention domestically. Given the positive experiences of those states that have granted artists resale royalty rights, the U.S.’s reluctance to follow their lead is puzzling.
While the resale royalty rights legislation enacted in California is currently being attacked on constitutionality grounds, speakers in Panel one suggested that the main problem is not that the U.S. legal system lacks the foundations to provide for such rights at the federal level. Rather, stakeholders, namely auction houses, have lobbied hard against resale royalty rights because of the potential ramifications such rights will have on their business. Lisa Jones confirmed that at least for mid-range auction houses, introducing resale royalty rights could detrimentally affect purchasing. However, Kevin Amer noted that the experiences of other countries have illustrated that the impact on the art market is exaggerated. Irina Tarsis observed that the auction houses’ interests have taken center stage partly because artists have failed to unite and vocalize their interests to counter the auction houses’ lobbying efforts.
At the end of Panel one, speakers noted the fear that targeting the obligation to pay resale royalties solely to auction houses would drive the art market “underground” into the private sphere. They hinted that this could have major repercussions for authentication because buyers often rely on auction houses to thoroughly investigate the provenance of a particular piece before agreeing to sell. This observation highlighted the interconnectedness of the issues presented throughout the symposium. As the speakers in Panel two explained, the art market is currently flooded with looted works. This has had a profound impact on authentication, and has increased the likelihood that museums and private buyers will purchase illicit works. The looting problem has also severely damaged the cultural heritage of the countries from which these works were stolen.
Many by now have likely seen the video ISIS posted online last week of its members destroying precious Assyrian antiquities displayed in the Mosul Museum in northern Iraq. Arguably, this video was not only aimed at undermining Iraq’s rich pre-Islamic culture, but also provoking a retaliatory response. The video illustrates that ISIS is acutely aware of the significance art and antiquities have on cultural identity. ISIS has not only been guilty of destruction, however. It has also substantially profited from the looting and sale of Syrian and Iraqi antiquities. Reports suggest that ISIS made around $36 million in Syria last year from a single looting incident.
As the opening keynote, Patty Gerstenblith explained, armed conflict is the “perfect storm” within which large-scale looting can take place. While such conduct has had a long history, it was not until the mid-twentieth century that the international community attempted to protect cultural property through international agreements. The 1954 Hague Convention on the Protection of Cultural Property in the Event of Armed Conflict prohibits the destruction and seizure of cultural property during armed conflicts, and the export of such objects from occupied territory. The 1970 UNESCO Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property addresses the international art market, and obligates states parties to regulate the import, export, and restitution of illicit works.
The opening keynote and speakers from Panel two emphasized that the ultimate aim of these conventions was to disincentivize looters from stealing art and antiquities for personal gain. The question remains how best to do so. Ms. Gerstenblith opined that the current legal regime lacks efficacy, and proposed that the international community unify the two legal regimes for combating the looting problem, one focusing on armed conflict, and the other on the international market. Eden Burgess highlighted the need for domestic approaches to tackle the looting problem, and commended the efforts of organizations such as the International Committee of the Blue Shield to train soldiers on the ground to prevent looting and destruction of cultural property. Leila Amineddoleh acknowledged that regulating the looting of objects during an armed conflict is difficult, if not impossible, and emphasized that this is why educating and encouraging buyers to investigate the origins of the works they wish to purchase is key. Bonnie Magness-Gardiner asserted that disrupting transnational criminal networks, and prosecuting individual looters through a variety of criminal charges reduce incentives to engage in the trafficking of cultural property, but highlighted the evidentiary issues that often arise in the course of such prosecutions.
While preventing looting should remain the ultimate objective, this only addresses one aspect of the problem. Owners of looted objects understandably want these works back. The question then becomes how to restore to them what they have lost. Responses have been contentious to say the least. Various stakeholders, including private owners, museums, lawyers, and governments, have been battling over the whether restitution or repatriation is even best means of protecting the art or antiquity in question. The Elgin Marbles controversy is the prime example. Nevertheless, speakers in Panel three, and the closing keynote, Tom Kline, were adamant that the return of looted works should be encouraged through transparency and good faith engagement between the current possessors and original owners.
The participants drew upon a series of examples to illustrate both the successes and downfalls of varying restitution and repatriation mechanisms. These mechanisms include litigation, bilateral agreements imposing import controls, official seizures, negotiation and settlement, voluntary return, and temporary loans. Gary Vikan provided the museum perspective, emphasizing that if the owners have a good reason for wanting it back, museums should accommodate. Frank Lord IV highlighted the tensions and obstacles that plague restitution litigation, especially when owners initiate proceedings in more than one country for the same work. He further noted that for Nazi-looted art, the statute of limitations often has a significant impact on the success of restitution litigation. Tom Kline advocated for a more comprehensive approach, where museums, source countries, and the original owners can collaborate to find a solution that best caters to all of their respective interests.
One important consideration is that it is often difficult to prove ownership in the restitution and repatriation process. Provenance research plays an important role in easing this difficulty. The efforts at the Smithsonian to engage in due diligence before obtaining pieces for its collection, illustrate the indispensable need for provenance research initiatives. Panelist, Jane Milosch, stressed that while a substantial degree of progress has been made, provenance research has faced many obstacles, particularly because of the lack of funding and connoisseurship in the field. Colette Loll emphasized that the increasing prevalence of fakes and forgeries in the international art market only makes provenance initiatives more complex, as fakes and forgeries distort the artistic record, and consequently compromise national and museum archives.
AUILR was privileged to have such well-renowned experts in the art and cultural property discourse to discuss how best to respect and protect the substantial value artists, countries, collectors, and museums place on arts and antiquities. These speakers not only provided a comprehensive assessment of the underlying concerns that undermine the protection of art and cultural property, but also provided unique perspectives on how to best combat these concerns. As Symposium Editor for AUILR, I hope that the symposium not only raised awareness of these issues in the international realm, but also had a positive impact on the discourse. I look forward to AUILR and WCL’s future involvement in helping to protect art and cultural property through international law. Please check back to our blog for the next few weeks to read more detailed descriptions of our keynotes and panels.
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