2. Buyers remorse: With many Chinese buyers paying way over the odds for antiques and fine art, it is likely that at least some of them will go away from the auction regretting the amount that they spent.
3. Unable to pay: Once again, overzealous bidding from determined Chinese bidders who do not want to “lose face” by losing an auction is likely to produce instances of buyers bidding beyond their means.
4. Negotiation tactics: It it likely that some Chinese buyers will not see the final auction price as the end of the sale and will begin negotiating with the auction house over the price as well as terms of payment once the sale has ended.
5. Currency exchange: Apparently it takes considerable time to transfer money out of a Chinese account and to perform the necessary currency exchange when purchases have been made outside China.
It is true that the number of instances of slow payment and non-payment have been very small, however, the issue is not so much how many instances there have been, but what the ramifications have been for the industry and for the sentiment of Chinese buyers. It is no secret that respect and honour are a big part of Chinese culture. Not wanting to “lose face” on such a public stage, Chinese bidders are likely to feel strong opposition towards the implementation of enforced deposits by several auction houses. To be asked to provide a deposit will potentially offend Chinese bidders who will see such a demand as disrespectful and offensive, because to be forced to pay a deposit suggests that the bidder is untrustworthy. If you think that demanding a deposit will not have an effect on auction proceedings then you might like to consider the poor results of the recent Meiyintang Collection auction that was held at Sotheby’s in Hong Kong which an article from Bloomberg suggests could be the result of required deposits for “premium lots”. Is this just the beginning of the downward spiral of the Chinese art market boom?
If you know of any other instances of non-payment by Chinese bidders or know of any other reasons that bidders are not paying then please leave a comment.
To be continued…………….
The 2 Qing bronze animal heads that Cai Mingchao purchased but refused to pay for in 2009
**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications