Sotheby’s enters mainland China
Sotheby’s has signed a ten year agreement with the state-owned Beijing GeHua company early this month, investing $ 1.2 million for 80% ownership. The move will strategically enhance Sotheby’s long-term presence in mainland China and allow it to potentially capitalise on the opportunities presented with by the rising Chinese art market. The agreement means the firm can now operate in Beijing – foreign auction houses are restricted to only doing business in Hong Kong, unless they partner with a domestic firm in the mainland.
The move will allow Sotheby’s to take advantage of a planned freeport that GeHua is developing within the Tianzhu Free trade Zone in Beijing. The freeport will serve as a tax-advantaged storage location and provide a platform for art-related auctions and private selling exhibitions of non-cultural relics, travelling exhibitions and educational activities.
Sotheby’s and Christies operate out of Hong Kong but have been restricted from auctioning in mainland China – unless they have a Chinese partner. That is now changing in the same fashion as mainland Chinese auction houses are entering into the Hong Kong market. Brand names and competition is now getting heated up in both HK and mainland China.