ECSH54550 - Factors to consider when dealing with AMPs
Source: gov.uk (2025-04-25)


There are some factors that need to be considered when dealing with a case involving Art market participants (AMPs), that are unique to other sectors supervised by HMRC.

While the factors below should be considered, they should be read in conjunction with the rest of the AMP guidance within this chapter.

Exchange rate

All references to the AMP threshold of 10,000 euros includes the equivalent amount in any currency.

AMPs will need to calculate the sterling equivalent of 10,000 euros using the London closing exchange rate for the euro and GBP for the previous working day before the sale or purchase took place.

For any transactions conducted in any other currency, AMPs will need to calculate the equivalent of 10,000 euros using the London closing exchange rate for the euro and the other relevant currency for the previous working day.

EC-S staff carrying out historical transaction testing, may wish to use the monthly exchange rate published by GOV.UK, rather than establish the exchange rate on the day of each sale or purchase. However, if there is a difference of opinion, (for example, if a transaction appears to be in scope but the business hasn’t carried out customer due diligence (CDD)), you will need to take into account how the business calculated the exchange rate on the day.

Exchange rates for 2024 can be found at HMRC currency exchange monthly rates - GOV.UK (trade-tariff.service.gov.uk) (https://www.trade-tariff.service.gov.uk/exchange_rates?_ga=2.177410917.xx-xxxx-xxxx.1710152756-302054279.xx-xxxx-xxxx) Archived exchange rates for 2023 going backwards can be found at the National Archives [ARCHIVED CONTENT] Exchange rates from HMRC in CSV and XML format - GOV.UK (nationalarchives.gov.uk) (https://webarchive.nationalarchives.gov.uk/ukgwa/20231016190054/https:/www.gov.uk/government/collections/exchange-rates-for-customs-and-vat)

Art rental

Any person or business who rents out art, depending on the rental arrangements, could be an AMP. If the rental agreement contained a provision for ownership of the artwork to pass to the customer at the end of a rental term, this would be a relevant transaction.

Joint ventures

Joint ventures, where multiple galleries will purchase a work of art jointly, and shared ownership of works of art, are within scope of The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR2017), if the sale or purchase is over the threshold amount.

In the case of a joint venture between two AMPs, they will both need to conduct CDD on each other, as this would be a business relationship.

Introducers

Introducers, a person introducing a buyer or seller to a gallery or vice versa, are only within the scope of MLR2017 if they receive a financial value which directly relates to their active participation in the sale or purchase of a work of art. At this point they would meet the definition of an intermediary.

If they do not receive a fee, and they are not actively involved in the transaction, it is unlikely they are an AMP.

A casual introduction with no fee involved is not within scope.

Framers and shippers

Framers and shippers are used extensively in the art world, arranging the delivery, framing and installation of works of art on behalf of clients.

Sometimes AMPs will have their own framers and shipper that work directly for them and other times they will use independent companies.

Framers and shippers usually do not buy or sell works of art, so unless they are acting as an intermediary, are unlikely to be an AMP.

Interior designers

Interior designers may fall under the definition of an AMP, if they are purchasing works of art for a client or facilitating a sale/purchase.

Museums

Museums may be within scope of MLR 2017 depending on their company structure and activities. Many museums are charities so may fall out of scope - for more information on charities see ECSH42575 (https://www.gov.uk/hmrc-internal-manuals/economic-crime-supervision-handbook/ecsh42575).

Exchange Of Art

If an AMP exchanges a work of art with another AMP, or another person or business it is still classified as a transaction, and HMRC consider this relevant activity, even if no money is exchanged.

This is based on the wording and interpretation of regulation 14(1)(d)(i) MLR 2017, as explained in ECSH54525 (https://www.gov.uk/hmrc-internal-manuals/economic-crime-supervision-handbook/ecsh54525).

The determination for whether a trade of works of art is within scope of MLR 2017, is the monetary value of the transaction (the value of the work of art being transferred), not the amount of money that changes hands.

Therefore, whilst a business can raise an invoice for a work of art and agree to a nominal payment, if the of the work of art is equal or exceeds the threshold it still meets the definition of AMP activity.

If an AMP trades or exchanges in Art they will need to ensure that they meet all of their obligations under MLR 2017, including CDD, policies, controls and procedures (PCPs), risk assessments (RAs) and registration with HMRC. They must ensure that their RAs include their assessment of risk for the exchange of works of art and that their PCPs reflect the process they follow.

Examples

Two art galleries agree to trade two paintings, with the same monetary value. Both paintings are valued at £20,000. This is AMP activity and both businesses are AMPs.

Two art galleries agree to trade two paintings, with different monetary values. One is valued at £5,000 and the other is £20,000. The gallery receiving the £20,000 painting trades the £5,000 painting and pays the other gallery £15,000. This is AMP activity and both businesses are AMPs, as the total transaction value is over the threshold and both AMPs need to carry out Customer Due Diligence (CDD).

A gallery agrees to trade paintings with an individual. The individual is an art collector and is not operating by way of business. They agree to exchange the individual’s £15,000 painting and £2,000 for a £17,000 painting. This is AMP activity. The gallery is an AMP,and needs to carry out CDD on the individual.