Auction house disclosure, securing collections and structured art ownership: art & cultural property insights
Insight
Auction house disclosure under the spotlight
Prominent collector Sasan Ghandehari is suing Christie's in the English High Court for alleged misrepresentation of the provenance of Femme dans un rocking-chair (Jacqueline), a Picasso purchased at auction in 2023 under a third-party guarantee.
The claim centres on Christie's alleged failure to disclose that the painting had previously been owned by an individual convicted of drug trafficking, information the claimant says would have raised concerns that the work may constitute the proceeds of crime.
If the case proceeds to trial, it is likely to explore issues around the nature and scope of representations made by auction houses, the extent of their due diligence obligations, and the legal tensions between buyer transparency and seller confidentiality.
Buyers operating at the top end of the market may find themselves seeking more comprehensive provenance information, while auction houses and galleries are likely to revisit what safeguards they have in place to protect both clients and the transaction. Intermediaries, too, should be prepared for more searching questions about checks carried out on a seller’s background.
Securing collections in a higher-risk world
A spate of art-related thefts, including the high-profile jewellery heist from the Louvre in October 2025, will drive renewed scrutiny of museums and gallery security. Ultimately, the safety of the collection is the responsibility of the museum trustees, and so the legal implications of security failures should be front of mind. We anticipate a heightened interest in risk assessments and reviews of security protocols in 2026.
Structured art ownership holds fast: lessons from QIPCO v Elanus
The High Court's decision in QIPCO v Elanus offers reassurance to collectors who hold high-value art or luxury assets through structured vehicles. Farrer & Co acted for the successful defendant on this complex dispute, which centred on a rare multi-million pound 70-carat light blue diamond known as 'The Idol's Eye'. The case reaffirmed the distinction between beneficial owners and corporate entities that legally own the asset.
The diamond had been placed within a corporate structure, and QIPCO entered into a 20-year loan agreement with that entity, which included a right of pre-emption should the lender have a 'wish to sell'.
QIPCO argued that an email sent by a lawyer acting for one of the beneficial owners amounted to such a wish, triggering their right to purchase the diamond. The judgment, handed down in February 2025, rejected this interpretation, holding that the email did not constitute a wish to sell and, even if it had, it could not be attributed to Elanus itself. We successfully defended QIPCO's application for permission to appeal in June 2025 bringing the matter to a close.
Changes in deaccessioning legislation, but not for everyone
After three years of uncertainty, sections 15 and 16 of the Charities Act 2022 came into force on 27 November 2025. These provisions allow trustees of charitable institutions to dispose of objects from their collection where they can evidence a strong moral obligation to do so, potentially unlocking new pathways for restitution and ethical deaccessioning.
However, the changes do not apply uniformly. Following concerns raised by the previous government that this would significantly alter the law for certain museums governed by statute, the Department for Digital, Culture, Media & Sport (DCMS) has explicitly excluded those institutions from the provision, including the British Museum, the National Gallery and the V&A (see the full list of excluded institutions in Schedule 2 of the commencement regulations here).
Internationally, France's adoption of a formal policy on the return of objects looted from former colonies, signals a shift in state-level approaches to cultural heritage. While the UK is not expected to follow suit, institutions are exploring alternative solutions, including long-term loans and cultural exchanges, exemplified by the planned visit of the Bayeux Tapestry to the British Museum in September 2026.
AI, copyright and cultural assets: no clarity from Stability
The Getty Images v Stability AI judgment delivered disappointment for artists and the creative industries while offering partial relief for AI developers.
Although Stability AI admitted that its large language model had been trained on Getty Images material, the court found that there was no secondary copyright infringement under UK copyright legislation as the model does not contain or store, even temporarily, copies of the works on which it has been trained.
Unfortunately for artists and cultural institutions, we do not yet have answers on the important question of whether the unauthorised scraping of online content, and its subsequent use to train AI models (if this takes place in the UK) will infringe copyright – this will be a matter for future cases. Our full analysis of this case is available here: Getty Images v Stability AI: partial victory for AI developers/deployers.
In December 2025, the court granted Getty permission to appeal to the Court of Appeal on the issue of secondary copyright infringement. Pending the outcome of that appeal, uncertainty remains over how UK copyright law applies to AI models which do not actually hold copies of artworks within them but which will produce copies of those artworks when promoted to do so by users.
Significant legal developments are anticipated in 2026, amid economic turbulence, the growing influence of AI and heightened public scrutiny. To help you prepare, our experts have produced key litigation-related insights across areas including arbitration, commercial litigation, contentious trusts & estates, family disputes, and more.
This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.
© Farrer & Co LLP, January 2026
