Menzies Art Brands auction house 'flouts ACCC terms'

MENZIES Art Brands has denied it is flouting the terms under which the ACCC dropped inquiries into its disclosure practices.

MENZIES Art Brands has denied it is flouting the terms under which the ACCC dropped inquiries into its disclosure practices.

The auction house is preparing for its September 23 sale in Melbourne.

In March, the competition regulator approved the fine art auction house's new practice of disclosing in its catalogue the fact some works were guaranteed and others were owned by the business's owner Rod Menzies.

If buyers ask, MAB staff are required to provide this information, but when The Australian asked whether three of the most expensive works at its next auction were owned, or part-owned, by company chairman Mr Menzies, MAB chief executive Litsa Veldekis refused to comment.

Mr Menzies declined to reveal whether he owned the works.

Brett Whiteley's painting of his daughter Arkie Under the Shower, John Brack's ice-skating picture Finale and the Russell Drysdale oil Landscape in the Kimberley were auctioned at MAB in the past three years.

The buyers have not been revealed and MAB's new catalogue says each work is owned by a "private collection, Melbourne".

Three of MAB's competitors who follow the market closely told The Australian they were confident Mr Menzies had a stake in the paintings.

If sold for their lower estimates, they will earn $2.5 million, plus a 20 per cent buyer's premium for the auction house.

MAB's total catalogue of 100 lots is valued at between $6.8m and $8.6m and as such, the Menzies-owned works account for more than one-third of the total value.

The Australian Competition & Consumer Commission suspended an inquiry into MAB's disclosure practices started 18 months earlier after complaints by a group of auction houses.

The other auctioneers claimed Mr Menzies's practice of consigning works in which he had a financial interest for auction, then buying them back and reporting the sale within the company's total sales, contravened section 52 of the Trade Practices Act.

MAB also offers seller guarantees, undisclosed to bidders, which the competitors said inflated prices artificially.

MAB's new disclosure reads, "If buyers want to know more about its ownership or guarantee status, they should speak to a representative of Menzies."

Ms Veldekis said: "I'm very happy to provide that information to a buyer, not the press."