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Spanish portrait bought by Prince of Liechtenstein detained in UK

The National Gallery is now trying to raise the funds to buy it

London

The Art Newspaper can reveal that a Spanish painting which the London National Gallery wants to buy is being retained in the UK, since it is part of a “package deal” which is under investigation by H.M. Revenue & Customs (HMRC). The work is the 1577 Portrait of Don Diego, by Alonso Sanchez Coello (November 2007, p15).

The Coello was subject to an export licence application for the Prince of Liechtenstein, for the Liechtenstein Museum in Vienna. There is no suggestion that the Prince or his museum were aware of any difficulties over the application or did anything improper. In an unprecedented move, on 20 November Arts Minister Ms Margaret Hodge deferred issuing an export licence until six weeks after the completion of the HMRC investigation and any resulting court action. This could take years.

In the meantime, the Coello has been deposited at the request of the UK authorities at the National Gallery, which has appropriate storage facilities.

Last month the Museums, Libraries and Archives Council (MLA), which administers the art export system, told us: “The National Gallery has expressed a serious interest in purchasing the Coello portrait. However, there is an ongoing investigation by HM Revenue & Customs, which includes consideration as to whether the MLA was supplied with incomplete or false information when an export licence for this painting was sought. In these unusual circumstances, the issue of what will happen in the future is still under consideration.”

The investigation involves London dealer Simon Dickinson, who was arrested on 13 September, in connection with the export of old masters from the UK. Although he was not named, HMRC said the case involved the possible “illegal export of a group of paintings valued at over £17m” (The Art Newspaper, October 2007, p63). The Coello is among this group.

Following the HMRC announcement, the Simon Dickinson gallery issued a statement, saying: “Simon C. Dickinson Ltd was instructed in the sale of a number of paintings by the Northbrook Collection to the Prince of Liechtenstein… The Gallery is confident that the paintings were exported in accordance with all relevant regulations.”

After the initial deferral of an export licence on the Coello in May, the National Gallery decided that it wanted to buy the picture, which was valued at £2m on the export licence application. The problem now is to determine whether this is a fair market value, since it may have been part of a “package” of paintings.

Meanwhile, in an entirely separate case, an export licence has been issued for the Rubens painting which was mistakenly shipped to America by Christie’s in breach of export regulations. As we revealed in October (pp1,5), Meleager and Atalanta Hunting the Boar was inadvertently sent to New York, following its sale in London on 8 December 2005, when it went to a New York collector for £3,144,000. Once the mistake had been noticed, the Export Reviewing Committee flew to New York for a meeting on 14 August 2007.

The committee decided that the Rubens did indeed meet the Waverley Criteria, and should be deferred to enable a UK buyer to match the price. The licence was therefore deferred until 11 November. However, in the end, no UK buyer emerged, and it was therefore never tested whether the picture would have been returned to London. The lack of a UK buyer was partly because a more important Rubens painting was up for sale, the sketch for the Whitehall Ceiling (Apotheosis of King James I), which Tate is currently trying to acquire for £5.7m (November 2007, p19).