The bill adds a new federal resale-royalty right for authors of visual art, separate from the existing bundle of copyright exclusives. It requires art-market professionals to remit royalties on qualifying secondary-market sales to collecting societies designated by the Register of Copyrights, and gives the Register authority to set implementing regulations.
The change creates a recurring revenue stream for visual artists and their heirs, changes compliance obligations for galleries, auction houses and dealers, and routes unclaimed royalties to the Copyright Office for artist programs. It also removes works of visual art from the statutory copyright-notice regime and requires a five-year study of implementation.
At a Glance
What It Does
The bill creates an independent federal entitlement to a resale royalty for authors of works of visual art and vests collecting societies with the collection and distribution role. The Register of Copyrights will designate collecting societies and issue implementing regulations, including allowable administrative deductions and reporting rules.
Who It Affects
Primary obligations fall on 'art market professionals'—galleries, dealers, auction houses and other participants that intervene in secondary sales of visual art. Visual artists, their heirs, designated collecting societies, and the Copyright Office also face new roles and benefits under the statute.
Why It Matters
This law would import the continental-style resale royalty into U.S. federal copyright, changing how secondary-market transactions are priced and documented and creating a permanent, enforceable economic interest for artists and their successors.
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What This Bill Actually Does
The Act inserts a new §106B into the Copyright Act establishing a standalone resale-right for works of visual art: when a qualifying secondary sale occurs, the author (or the author’s successors) has an entitlement separate from reproduction or display rights. That entitlement lasts for the same period as copyright and cannot be sold or waived, so it follows the artist (and later heirs) for the full copyright term.
Not every resale triggers the right. The statute confines coverage to "commercial resales" that involve an "art market professional" and to sales above a monetary threshold.
The bill makes the art-market participant—not the artist—responsible for collecting the royalty and delivering it to a collecting society designated by the Register. The collecting society then must distribute proceeds to the author or successors on a quarterly basis after deducting reasonable administrative expenses subject to Register rules.The bill specifies timing and fallback rules aimed at practical administration: art-market professionals must remit collections within a fixed period after final payment; collecting societies must place undistributable royalties into interest-bearing escrow while attempting to locate payees; and if royalties remain unclaimed after a three-year search period, the funds are transferred to the Copyright Office to fund artist programs.
The Register gets broad regulatory authority to define eligible collecting societies, set reporting requirements, permit the exchange of sale information, and remove or replace societies that fail to meet standards.Enforcement is tightly scripted. Collecting societies may sue art-market professionals for unpaid royalties and recover the royalty amount plus attorneys’ fees if they act within a short window; if no society sues, authors or successors can later bring a damages action with an enhanced remedy.
The bill also makes the remedies exclusive for collection/distribution failures to avoid parallel state-law claims. Finally, the Act excludes works of visual art from the federal notice-on-deposit rule and requires the Register to study implementation after five years; the statute becomes effective one year after enactment.
The Five Things You Need to Know
The royalty applies only to commercial resales handled by an "art market professional" and only when the resale price is $5,000 or more.
The royalty equals 5% of the sale price, capped at $50,000 per sale, with the dollar cap indexed annually by a specified cost-of-living adjustment.
Art-market professionals must pay collected royalties to Register-designated collecting societies within 90 days of final payment; collecting societies must distribute net amounts to authors or successors quarterly.
If a collecting society cannot locate a payee, it must escrow funds and search; if unclaimed after three years, the funds transfer to the Copyright Office for artist programs and the society’s obligation is satisfied.
Enforcement: designated collecting societies can sue within one year to recover unpaid royalties and fees; if no society acts, authors or successors can sue within three years for treble damages and attorneys’ fees; remedies are exclusive under the statute.
Section-by-Section Breakdown
Every bill we cover gets an analysis of its key sections.
Definitions that frame coverage
The bill defines key terms—'art market professional,' 'commercial resale,' 'resale copy,' 'price,' 'author’s successor,' and 'visual artists’ collecting societies.' Those definitions determine who triggers collection duties and what objects are covered (single or limited-edition material objects). The wording focuses liability on intermediaries that participate in sales rather than private, owner-to-owner transfers without market intervention, but the definition leaves room for regulatory clarification about online platforms, consignment agents, and other modern market intermediaries.
Entitlement, threshold, and duration
The author gains an independent resale royalty right 'independent of the exclusive rights' in §106, but the bill limits eligibility to resales handled by an art-market professional and to sales at or above $5,000. The right lasts the full term of copyright, meaning artists and their heirs remain entitled for the entire copyright period, and the statute expressly bars sale or assignment of that entitlement.
How the royalty is calculated
The royalty is set at 5% of the sale price, capped at $50,000 per sale. The cap is subject to an annual cost-of-living adjustment tied to a variant CPI measure named in the bill. That blended structure—percentage with a high-dollar cap—targets lower-value sales with a proportional payment while limiting exposure on very high-priced transactions.
Collection, distribution, escrow and unclaimed funds
Art-market professionals must remit royalties to collecting societies designated by the Register within 90 days of final payment. Collecting societies must distribute net proceeds quarterly after deducting reasonable administrative expenses (to be specified by Register regulation). If a society cannot locate a payee, it must place funds in interest-bearing escrow, publicize reclamation procedures, and continue good-faith searches; funds unclaimed after three years are transferred to the Copyright Office for artist programs, and that transfer discharges the society’s obligations for those funds.
Enforcement, remedies, and nontransferability
The bill creates an enforcement ladder: designated collecting societies may sue art-market professionals within one year to recover unpaid royalties and attorneys’ fees. If no society sues within that period, authors or successors may sue within three years to recover treble damages and attorneys’ fees. The statute declares these remedies exclusive and forbids the sale or assignment of the resale-right itself, preserving the royalty for the artist or legal heirs.
Eligibility, Register powers, and fallback mechanisms
Collecting societies may distribute royalties to U.S. citizens or domiciliaries, or to authors from countries that provide reciprocal resale royalties. The Register gets broad rulemaking authority: to designate and decertify societies, set allowable administrative deductions, require reporting of sale data from art-market professionals, and craft alternative collection mechanisms if no suitable society exists. The bill contemplates a 'closest alternative' designation if the Register cannot find an entity that meets the ideal qualifications.
Notice exception, study, and effective date
Section 3 removes works of visual art from the federal statutory deposit/notice provisions, meaning the notice-on-deposit rule in §401 does not apply to visual art. Section 4 requires the Register to study implementation and report after five years. Section 5 makes the law (and conforming code changes) effective one year after enactment, giving time to set up designations and regulations.
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Explore Culture in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Living visual artists: They gain a perpetual, statutory revenue stream on secondary-market sales handled by art-market professionals, providing ongoing compensation that follows works through the market and into estate succession.
- Heirs and successors of artists: The statute spells out inheritance rules and preserves the royalty for heirs, offering an asset that can support descendants and estates over the copyright term.
- Designated collecting societies and artist-administration intermediaries: Societies gain a central administrative role and revenue for managing distributions and may charge reasonable administrative fees subject to Register oversight.
- The Copyright Office and public artist programs: Unclaimed funds transferred after three years become a new funding source for programs and education the Copyright Office will administer.
Who Bears the Cost
- Art market professionals (galleries, dealers, auction houses, online platforms): They must collect, report and remit royalties, update contracts and invoicing systems, and face potential liability for missed payments and increased compliance costs.
- Designated collecting societies: They must administer collections in compliance with accounting standards and Register regulations, run payee searches, maintain escrow accounts, and bear operational costs that may exceed fee caps or require transparency and audits.
- Buyers and consignors: Secondary-market buyers could face higher gross prices or pass-through costs as sellers and intermediaries internalize the royalty and compliance burdens.
- The Copyright Office and agency resources: The Register must create designation and oversight processes, issue regulations, monitor societies, and conduct the required five-year study—tasks that require staff time and potentially new appropriations.
Key Issues
The Core Tension
The bill pits two legitimate objectives against each other: ensuring artists and their heirs capture economic value from secondary sales versus preserving the liquidity and low-friction operation of the secondary art market; securing artist compensation requires collection, reporting, and enforcement friction that dealers and platforms say will raise costs and complicate transactions, and the statute pushes much of the line-drawing to future rulemaking.
The bill solves the normative question of whether artists should share in secondary-market gains by creating a statutory collection mechanism, but it leaves several operational and economic questions unresolved. The definition of 'art market professional' anchors liability on intermediaries, yet the law delegates fine-grained boundary work (online marketplaces, private dealers operating through platforms, fractional ownership or galleries that both exhibit and sell) to regulations.
That deferral creates near-term uncertainty for market participants who must change contracts and accounting systems before the Register’s rules are finalized.
The enforcement scheme creates strategic incentives: collecting societies get a short window to file suit for unpaid royalties with ordinary damages and fees, but absent action the artist can later seek treble damages. That structure encourages societies to litigate early, but also risks duplicative administrative expense.
The three-year unclaimed-funds rule routes orphaned royalties to the Copyright Office for artist programs, a pragmatic fix that transfers discretion to an agency but may frustrate heirs who cannot be found due to inadequate genealogical records. Finally, the bill’s mix of a percentage rate and a high-dollar cap mitigates exposure on mega-sales but could produce sharp discontinuities in incentives around the cap and threshold amounts.
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