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Article

A Freeport Comes to Luxembourg, or, Why Those Wishing to Hide Assets Purchase Fine Art

College of Humanities and Sciences, Thomas Jefferson University, Philadelphia, PA 19144, USA
Received: 4 June 2020 / Revised: 17 July 2020 / Accepted: 4 August 2020 / Published: 9 August 2020
(This article belongs to the Special Issue The Contemporary Art Market)
This article addresses how global art markets are becoming an outlet of choice for those wishing to hide assets. Recent efforts by the OECD and the U.S. Treasury have made it more difficult for people to avoid taxes by taking money “offshore”. These efforts, however, do not cover physical assets such as fine art. Citing data collected in Luxembourg—a jurisdiction angling to become a worldwide leader in “art finance”—I discuss the characteristics of this emerging system of opaque economic activity. The first of these is a “freeport”, a luxurious and securitized warehouse where investors can store, buy, and sell art tax free with minimal oversight. The second element points to the work of art-finance professionals, who issue loans using fine art as collateral and develop “art funds” linked to the market value of certain artworks. The final elements cover lax scrutiny by enforcement authorities as well as the secrecy techniques typically on offer in offshore centers. Combining these elements in jurisdictions such as Luxembourg can make mobile and secret the vast wealth stored in fine art. I end the article by asking whether artworks linked to freeports and opaque financial products have become the contemporary version of the numbered Swiss bank account or the suitcase full of cash. View Full-Text
Keywords: freeports; fine art; global art markets; art finance; tax evasion; tax havens; offshore financial centers; Luxembourg freeports; fine art; global art markets; art finance; tax evasion; tax havens; offshore financial centers; Luxembourg
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MDPI and ACS Style

Weeks, S. A Freeport Comes to Luxembourg, or, Why Those Wishing to Hide Assets Purchase Fine Art. Arts 2020, 9, 87. https://doi.org/10.3390/arts9030087

AMA Style

Weeks S. A Freeport Comes to Luxembourg, or, Why Those Wishing to Hide Assets Purchase Fine Art. Arts. 2020; 9(3):87. https://doi.org/10.3390/arts9030087

Chicago/Turabian Style

Weeks, Samuel. 2020. "A Freeport Comes to Luxembourg, or, Why Those Wishing to Hide Assets Purchase Fine Art" Arts 9, no. 3: 87. https://doi.org/10.3390/arts9030087

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