Sotheby's owner blames Brexit for art market downturn due to falling profits

Sotheby's has curated a number of high-profile sales in recent years, including that of David Hockney. 'Splash' Photo: Michael Bowles/Getty Images

Sotheby's blamed Brexit bureaucracy for the downturn in the British art market, as its profits fell by almost 75%

Historic auction house owned by French billionaire Patrick Drai reported a drop in profits to $88m (£69m) in 2022, down from $318m the previous year.

According to the latest reports from parent company BidFair, total sales revenue fell to $127 million from $360 million.

Executives blamed the impact of Brexit on the downturn, as imports of art and antiques fell 18% in 2021 and another 16% last year. They warned that the downturn «could deepen over time.»

Sotheby's said: «The increase in red tape as a result of Brexit is negatively impacting our ability to move property between the UK and the European Union, as well as retention and travel by our staff, further contributing to the downturn in the UK advertising market.”

< p>The company said that additional import and export taxes and duties have negatively affected the attractiveness of property sales in the UK compared to other locations.

The company added that the quantity and quality of property for sale in London and future demand art on its London trading floor was also affected.

The figures highlight the continuing impact of the UK's decision to leave the EU on the 279-year-old auction house.

Sotheby's went private in a $3.7 billion Drahi takeover deal through its holding company BidFair in 2019. .

The deal was hailed as a high point in an art market that has recovered strongly from the global financial crisis.

Patrick Drai signed a $3.7 billion deal with Sotheby's in 2019. Photo: STEPHANE DE SAKUTIN/AFP via Getty Images.

Sotheby's has seen a number of high-profile sales in recent years, including works by artists including Andy Warhol. , David Hockney and Mark Rothko.

Last year, he closed the $922 million sale of the Macklow Collection, the most valuable art collection ever sold at auction.

But beyond the high-profile transactions. , Sotheby's, which has 80 offices around the world, has been hit by uncertainty and market volatility since Brexit.

The company said the invasion of Ukraine had little impact on its business as it does not sell in Russia and Russian clients accounted for less than 1% of its operations in 2021 and 2022.

However, Sotheby's did This. to close a small administrative office in Moscow after the outbreak of war.

These figures come at a turbulent time for Mr. Drahi, who made his fortune on his Altice telecommunications empire and is now BT's largest shareholder.

Drai's right-hand man Armando Pereira was arrested last month in Portugal as part of an investigation into a major corruption, money laundering and tax fraud case involving Altice's operations in the country.

The scandal resonated. through the European empire of Altice, with a number of executives and deliveries suspended.

His lawyer, Manuel Magalhaes y Silva, said Mr. Pereira was «totally» innocent.

Altice said about it. is the victim of alleged wrongdoing by «certain individuals and outside organizations». A spokesperson for Sotheby's said it was not related to this issue.