TheChek News Flow

Anthropic did not violate copyright law by training its large language models on copies of books because the training was protected under “fair use,” a federal district court in San Francisco ruled Tuesday.

Authors Andrea Bartz, Charles Graeber and Kirk Johnson sued Anthropic last year, alleging that the AI company violated copyright laws by purchasing and downloading books, including their own, and using them to train its Claude models.

The court ruled that Anthropic’s use of these books in training was “exceedingly transformative,” so it qualified as fair use. “To make anyone pay specifically for the use of a book each time they read it, each time they recall it from memory, each time they later draw upon it when writing new things in new ways would be unthinkable,” the court wrote.

However, it found that Anthropic—in addition to buying millions of print books—also “pirated” over 7 million books, including from popular sources such as Library Genesis and Pirate Library Mirror, when it downloaded the books and stored them, which was not protected by fair use. Anthropic has argued that it only downloaded the books to develop its AI, which is fair use. This claim is set to go to trial.

OpenAI has been gearing up to take on Google and Microsoft with features that let people collaborate on documents and communicate via chat in ChatGPT, according to two people who have seen the designs.

Launching these features would pit OpenAI more directly against Microsoft, its biggest shareholder and business partner, as well as open a new front in its battle with Google, whose search engine has already lost traffic to people using ChatGPT for web searches. Exactly whether or if OpenAI will release the features isn’t clear, however.

The new features reflect OpenAI CEO Sam Altman’s strategy to make ChatGPT a “supersmart personal assistant for work,” as he has put it, even though the app is primarily aimed at consumers. The designs for collaboration features suggest OpenAI could consider developing related productivity features such as file storage.

OpenAI and Microsoft already compete for business customers in selling AI assistants, coding assistants and AI models accessed via application programming interface by more advanced developers.

But if OpenAI goes ahead with the new features, targeting the heart of Microsoft’s dominant suite of productivity apps, it could strain the companies’ already complicated relationship. OpenAI is trying to get Microsoft to sign off on the startup’s plan to restructure its for-profit unit, which oversees ChatGPT. Both companies are angling to get major concessions from one another in the process.

An OpenAI spokesperson declined to comment.

The collaboration features would be a natural extension of how people use ChatGPT and consistent with OpenAI’s efforts to control the gateways through which consumers and enterprises use the web or get work done. Those efforts include developing a personal AI device, designing a web browser, and developing a social media feed, similar to X (formerly Twitter) for ChatGPT customers to publicly share images or other content.

Collaboration tools and file storage could make ChatGPT more attractive to businesses, which have been purchasing subscriptions to the chatbot. Companies prefer to buy a bundle of productivity apps, such as Microsoft Office and Google Workspace, for their workforces. And the bundles Microsoft and Google sell now include AI assistant features that resemble those of ChatGPT.

Inside OpenAI, leaders such as product chief Kevin Weil first discussed and showed off designs for the document collaboration feature nearly a year ago, one of the people said. But OpenAI didn’t have enough people to develop the product, given there were other priorities at the time, according to another person with knowledge of the situation.

But in October, OpenAI launched Canvas, a ChatGPT feature that makes it easier for people to draft documents and code with AI, a possible first step towards the launch of the collaboration features. (The document collaboration designs suggest OpenAI could also develop collaboration tools for coders.)

More recently, OpenAI developed but hasn’t launched software allowing multiple ChatGPT customers to communicate about their shared work in the app, the first person said.

OpenAI recently launched a notetaking tool that can record calls or meetings and drops notes about them into Canvas, though it is of limited value because ChatGPT doesn’t offer file storage and other basic productivity features.

The company says it has increasingly generated revenue from team- or companywide ChatGPT subscriptions at firms including Moderna and T-Mobile. OpenAI recently offered discounts on such subscriptions, much to the chagrin of Microsoft workers who sell competing applications.

OpenAI has projected roughly $15 billion in revenue from business subscriptions to ChatGPT in 2030, up from $600 million in revenue in 2024.

The next big shoe-shopping event will be back-to-school, which could reflect the consumer mindset as some prices go up amid weakening confidence.

Consumers are concerned about tariffs and they are less confident than they were last month — that does not bode well for footwear sales.

“Consumer confidence weakened in June, erasing almost half of May’s sharp gains,” Stephanie Guichard, the Conference Board’s senior economist, global Indicators, said. “The decline was broad-based across components, with consumers’ assessments of the present situation and their expectations for the future both contributing to the deterioration.”

The Conference Board said on Tuesday that its Consumer Confidence Index fell to 93.0 in June from 98.4 in May. The Present Situation component fell 6.4 points to 129.1. The Expectations Index fell 4.6 points to 69.0, representing a level that was substantially below the threshold of 80 that typically signals that a recession is ahead.

“Consumers were less positive about current business conditions than May. Their appraisal of current job availability weakened for the sixth consecutive month but remained in positive territory, in line with the still-solid labor market,” Guichard said.

She noted that the three components of the Expectations Index — business conditions, employment prospects, and future income — all weakened. And consumers were more pessimistic about business conditions and job availability over the next six months, with optimism about future income prospects eroding slightly.

The data points also reflected that the retreat in confidence was shared by all age groups, and almost all income groups. It was also shared across all political affiliations, withe the largest decline among Republicans, the Conference Board said.

As for write-in responses in June’s survey, Guichard said that tariffs “remained on top of consumers’ minds and were frequently associated with concerns about their negative impacts on the economy and prices.” Consumers also cite inflation and high prices as concerns.

While dining out was one of the few categories to see spending intentions rise in June, most other categories saw declines.

While shoe prices at retail slid 1.6 percent in June from a year ago in May, that’s already changing. Gary Raines, chief economist at the Footwear Distributors and Retailers of America (FDRA), told Footwear News that there was mounting evidence of surging average duties per pair on footwear imports. “These higher duties soon may push the average landed cost of footwear imports sharply higher, which in turn may pressure retail footwear prices to climb later this year,” FDRA’s Raines said.

Nike last month said it was raising some retail prices at its U.S. stores starting June 1, but not for any goods priced at $100 or less. The sports apparel and footwear brand also won’t be raising prices for any kids’s footwear or apparel items. In addition, there are no scheduled increases for any Jordan product. The average price uptick for apparel and equipment is between $2 and $10, while footwear currently between $100 and $150 will see increases up to $5 and those starting at $150 and higher will see increases up to $10, a source told FN.

Other footwear firms have also tinkered with price increases. Steve Madden Ltd. has also increased prices for select shoe styles, and the firm is also working to factories and suppliers on price concessions so it can keep increases to the consumer within a certain range. And over at Crocs Inc., CEO Andrew Rees said the company is being “super strategic” on pricing, with some targeted increases. He also expects the industry “to go up in terms of price” due to tariffs.

The next big shopping event for footwear will be back-to-school, which starts as early as July. Hibbett is ready with a new website and app dedicated to seeking kids products, and its set up for shoppers to find the lastest fashion and footwear styles in an easy-to-navigate format.

Preliminary classified findings indicate that the attack sealed off the entrances to two facilities but did not collapse their underground buildings.

A preliminary classified U.S. report says the American bombing of three nuclear sites in Iran set back the country’s nuclear program by only a few months, according to officials familiar with the findings.

The strikes sealed off the entrances to two of the facilities but did not collapse their underground buildings, the officials said the early findings concluded.

Before the attack, U.S. intelligence agencies had said that if Iran tried to rush to making a bomb, it would take about three months. After the U.S. bombing run and days of attacks by the Israeli Air Force, the report by the Defense Intelligence Agency estimated that the program had been delayed, but by less than six months.

The report also said that much of Iran’s stockpile of enriched uranium was moved before the strikes, which destroyed little of the nuclear material. Iran may have moved some of that to secret locations.

Some Israeli officials said they also believed that the Iranian government had maintained small covert enrichment facilities so it could continue its nuclear program in the event of an attack on the larger facilities.

Other officials noted that the report found that the three nuclear sites — Fordo, Natanz and Isfahan — had suffered moderate to severe damage, with the facility at Natanz damaged the most. It is not clear whether the Iranians will try to rebuild the programs.

Former officials said that if Iran tried to quickly develop a bomb, it would be a relatively small and crude device. A miniaturized warhead would be far more difficult to produce, and the extent of damage to that more advanced research is not clear.

Current and former military officials had cautioned before the strike that any effort to destroy the Fordo facility, which is buried more than 250 feet under a mountain, would probably require waves of airstrikes, with days or even weeks of pounding the same spots.

American warplanes did hit the same spots at least twice on Saturday. B-2s dropped 12 GBU-57 Massive Ordnance Penetrator bombs — often referred to as “bunker busters” — on Fordo, and six aboveground entry craters are now visible, according to Brian Carter, the Middle East portfolio manager at the American Enterprise Institute.

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But many military bomb experts believed that more than one day of strikes would be needed to complete the job.

Sign up to get Maggie Haberman's articles emailed to you. Maggie Haberman is a White House correspondent reporting on President Trump. Get it sent to your inbox.

The initial damage assessment suggests that President Trump’s claim that Iran’s nuclear facilities were “obliterated” was overstated. Congress had been set to be briefed on the strike on Tuesday, and lawmakers were expected to ask about the findings, but the session was postponed. Senators are now set be briefed on Thursday, and House members on Friday.

Since the strikes, Mr. Trump has complained to advisers repeatedly about news reports that have questioned how much damage was done, said people with knowledge of the comments. He has also closely watched the public statements of other officials when they are asked about the damage to the nuclear facilities, they said.

In a statement on Tuesday, Defense Secretary Pete Hegseth reiterated Mr. Trump’s early assessment.

“Based on everything we have seen — and I’ve seen it all — our bombing campaign obliterated Iran’s ability to create nuclear weapons,” he said. “Our massive bombs hit exactly the right spot at each target and worked perfectly.”

Officials cautioned that the five-page classified report was only an initial assessment, and that others would follow as more information was collected and as Iran examined the three sites. One official said that the reports people in the administration had been shown were “mixed” but that more assessments were yet to be done.

But the Defense Intelligence Agency report indicates that the sites were not damaged as much as some administration officials had hoped, and that Iran retains control of almost all of its nuclear material, meaning if it decides to make a nuclear weapon it might still be able to do so relatively quickly.

Officials interviewed for this article spoke on the condition of anonymity because the findings of the report remain classified.

The White House took issue with the assessment. Karoline Leavitt, a White House spokeswoman, said its findings were “flat-out wrong.”

“The leaking of this alleged assessment is a clear attempt to demean President Trump, and discredit the brave fighter pilots who conducted a perfectly executed mission to obliterate Iran’s nuclear program,” she said in a statement. “Everyone knows what happens when you drop 14 30,000-pound bombs perfectly on their targets: total obliteration.”

Elements of the intelligence report were reported earlier by CNN.

The strikes badly damaged the electrical system at Fordo, officials said. It is not clear how long it will take Iran to gain access to the underground buildings, repair the electrical systems and reinstall equipment that was moved.

There is no question that the bombing campaign “badly, badly damaged” the three sites, Mr. Carter said.

But initial Israeli damage assessments have also raised questions about the effectiveness of the strikes. Israeli defense officials said they had also collected evidence that the underground facilities at Fordo were not destroyed.

Before the strike, the U.S. military gave officials a range of possibilities for how much the attack could set back the Iranian program. Those ranged from a few months on the low end to years on the higher end.

Some officials cautioned that such estimates are imprecise, and that it is impossible to know how long Iran would exactly take to rebuild, if it chose to do so.

Despite claims of the sites’ obliteration by Mr. Trump and Mr. Hegseth, Gen. Dan Caine, the chairman of the Joint Chiefs of Staff, has been more careful in describing the attack’s effects.

“This operation was designed to severely degrade Iran’s nuclear weapons infrastructure,” General Caine said that at the Sunday news conference.

The final battle damage assessment for the military operation against Iran, General Caine said on Sunday, standing next to Mr. Hegseth, was still to come. He said the initial assessment showed that all three sites “sustained severe damage and destruction.”

General Caine added that it was “way too early” to assess how much of Iran’s nuclear program remained.

Gen. Joseph L. Votel, the former commander of Central Command, said in an interview, that he had “a lot of confidence in the weapons systems used.” But he added: “I’m not surprised that elements survived. That’s why you do battle damage assessments, because everything can go as planned but there are still other factors.”

At a Senate hearing on Tuesday, Democrats also struck a more cautionary note.

“We still await final battle damage assessments,” said Senator Jack Reed of Rhode Island, the senior Democrat on the Armed Services Committee.

Military officials had said that to do more significant damage to the underground sites, they would have to be hit with multiple strikes. But Mr. Trump announced he would stop the strikes after approving the first wave.

U.S. intelligence agencies had concluded before the strikes that Iran had not made the decision to make a nuclear weapon, but possessed enough enriched uranium that if it decided to make a bomb, it could do so relatively quickly.

While intelligence officials had predicted that a strike on Fordo or other nuclear facilities by the United States could prompt Iran to make a bomb, U.S. officials said they do not know yet if Iran would do so.

Representatives of the Defense Intelligence Agency did not respond to requests for comment.

Preliminary classified intelligence report produced by the Defense Intelligence Agency counters White House’s claims of more-extensive damage

Key Points

A preliminary intelligence report found that the U.S. military’s strikes last weekend on three Iranian nuclear facilities only set back Tehran’s nuclear ambitions by a few months, countering claims made by President Trump and the White House, according to people familiar with the intelligence.

The initial findings, written by the Defense Intelligence Agency, relied on military damage assessments following the U.S. bombings, the people said, adding that the assessment could change as more intelligence is collected.

A senior administration official confirmed the report’s existence but said it hadn’t risen to the level of being shared with the Defense Department’s top leaders. Several members of Congress, including full committees, have seen or have access to the report, lawmakers said.

U.S. intelligence agencies frequently produce classified reports that are later revised, sometimes substantially, as more information is collected. Such reports don’t necessarily reflect the views of other spy agencies, and disagreement among the agencies isn’t uncommon.

Karoline Leavitt, the White House press secretary, said in a post on X that the “alleged ‘assessment’ is flat out wrong,” and described the report as classified at the top-secret level. She blamed an “anonymous, low-level loser in the intelligence community” for leaking the report to the media. CNN earlier reported on the assessment.

The Office of the Director of National Intelligence, which oversees all intelligence agencies in the U.S. government, declined to comment. The Defense Intelligence Agency didn’t respond to a request for comment.

The report contradicts statements from Trump, who has repeatedly said the targets of the raids were destroyed. “Those targets were obliterated,” he said Tuesday morning. Some independent nuclear security experts have said they believe that Iran sustained significant to severe damage to its nuclear program.

Defense Secretary Pete Hegseth also challenged the intelligence report. “Based on everything we have seen, and I’ve seen it all, our bombing campaign obliterated Iran’s ability to create nuclear weapons,” he said Tuesday, adding: “Anyone who says the bombs were not devastating is just trying to undermine the president and the successful mission.” Trump posted Hegseth’s comments on social media.

The administration delayed a classified Iran briefing scheduled for lawmakers on Tuesday, leading some in Congress—mainly Democrats—to question whether U.S. intelligence matches up with Trump’s public statements.

The strikes over the weekend shut the entrances to underground facilities at two of the sites, but didn’t collapse their underground structures, the report said, according to an official familiar with the assessment.

One of the people familiar with the intelligence said the facilities were degraded, but not severely, and that Iran still retained the ability to enrich uranium. Iran may have also moved enriched material from the sites before they were destroyed, and may have other covert sites to enrich uranium, the person said.

Early last week, days before the U.S. strikes on Iran, a senior U.S. intelligence official said the consensus intelligence community view at the time was that Israel’s bombing campaign had already set back Iran’s nuclear program by five to six months.

The U.S. strikes targeted three key Iranian nuclear sites: Natanz, Isfahan and Fordow. American B-2 stealth bombers dropped a total of 14 30,000-pound GBU-57 Massive Ordnance Penetrator “bunker buster” bombs at targets including Fordow, which has an underground nuclear facility. U.S. submarines also fired Tomahawk cruise missiles at the Isfahan site.

The director general of the International Atomic Energy Agency, Rafael Mariano Grossi, said Monday that the strikes likely caused “significant damage” at Fordow, but that no one, including the agency, was in a position to assess the damage at the underground site fully.

A fuel-enrichment plant was hit at Natanz, Grossi told the IAEA board of governors Monday. At Isfahan, other buildings were hit, as were entrances to tunnels used for storing enriched nuclear material, he said.

The strikes followed days of Israeli bombing at Iranian military and government sites. Israel and the Trump administration said the strikes were intended to stop Iran from acquiring nuclear weapons. Iran says its nuclear program is peaceful.

Israel-Iran Conflict Spurs China to Reconsider Russian Gas Pipeline

Power of Siberia 2 project has been stalled for years, but Beijing is concerned about reliability of oil and gas from Middle East

Key Points

The war between Israel and Iran has revived Chinese leaders’ interest in a pipeline that would carry Russian natural gas to China, according to people close to Beijing’s decision-making, potentially jump-starting a project that has been stalled for years.

The Power of Siberia 2 pipeline project has been mired in disagreements over pricing and ownership terms, as well as Chinese concerns about relying too heavily on Russia for its energy supplies. But the recent war in the Middle East has given Beijing reason to reconsider the reliability of the oil and natural gas it gets from the region, the people said, even as a fragile cease-fire between Israel and Iran takes hold.

China imports around 30% of its gas in the form of liquefied natural gas from Qatar and the United Arab Emirates via the Strait of Hormuz, a maritime chokepoint that Iran threatened to close, according to consulting firm Rystad Energy. Meanwhile, China’s independent refineries, known as teapots, have in recent years become hooked on cheap Iranian crude.

More than 90% of Iran’s oil exports now go to China, analysts say, even though the U.S. has sanctions designed to prevent Iran from selling its oil abroad. Trump made an unusual acknowledgment of China’s Iranian oil imports Tuesday after announcing a cease-fire in the Israel-Iran conflict. “China can now continue to purchase Oil from Iran. Hopefully, they will be purchasing plenty from the U.S., also,” he said in a post on social media.

A White House official later said Trump was simply calling attention to the fact that the cease-fire prevented disruption to oil flows through the Strait of Hormuz. He continues to call on China to import U.S. oil rather than Iranian oil in violation of U.S. sanctions, the official said.

But, even with a cease-fire in place, the recent conflict has spurred Beijing to cast about for alternatives, the people and analysts say.

Beijing is also looking to increase oil purchases from Russia, which supplies around one-fifth of China’s oil, analysts say. Moscow has been pushing to boost its energy sales to its neighbor as it needs cash to fund its war in Ukraine.

“The volatility and unpredictability of the military situation have shown the Chinese leadership that stable land-based pipeline supply has geopolitical benefits,” said Alexander Gabuev, the director of the Carnegie Russia Eurasia Center and an expert on China-Russia relations. “Russia could benefit from that.”

Russian state media have linked the tensions in the Middle East to the revival of the Power of Siberia 2 project. “LNG Armageddon: China Urgently Returns to Power of Siberia 2 Project,” read one recent headline on Prime, a Russian state news website. Russia is expected to try to put the project on the agenda when President Vladimir Putin visits Chinese leader Xi Jinping in China in September, analysts say.

The Power of Siberia 2, a sequel to the original Power of Siberia gas link that opened in 2019, has long been more urgent to Moscow than to Beijing. Russia lost its biggest energy market when much of its gas exports to Europe stopped after its invasion of Ukraine.

Since then, Moscow has become increasingly dependent on China as a buyer. But limited pipeline infrastructure and small LNG capacity meant that only a new, bigger pipeline could significantly boost supplies to China.

For Beijing, on the other hand, LNG supplies from the Middle East and other places meant that a deal was far less crucial. One official reason they have given to Russia is that China limits the import of oil and gas from a single country to 20%, according to the people close to Beijing’s decision-making. As a result, talks have dragged on for years, even as Moscow has repeatedly indicated a deal was imminent.

That might now be changing.

The Strait of Hormuz, which flows between Oman and Iran and connects the energy-rich Persian Gulf with the Arabian Sea, is deep and wide enough to handle the world’s largest tankers. That makes it a critical pass-through point for oil and gas, and its closure could disrupt markets and raise energy costs.

The likelihood of a complete closure of the Strait is low because of Iran’s reliance on it and the potential U.S. military response it could draw, analysts say, but the recent conflict has highlighted the impact such a move would have.

“The escalation of the Middle East tensions underscores the severe consequences of a potential blockade in the Strait of Hormuz,” said Wei Xiong, head of China gas research at Rystad. If the chokepoint is blocked, “China’s LNG supply situation will face huge change, moving from being over-contracted to supply deficit.”

Beyond the current turmoil in the Gulf, the U.S.-China trade war has in recent months led to a halt in U.S. LNG exports there, reversing years of growing energy trade between the two nations. Longer term, as China pursues its green energy goals, Beijing foresees an expanding role for natural gas as a so-called bridge fuel between the hydrocarbon and post-carbon eras, analysts say.

China is also interested in strengthening its relationship with Russia at a time when the Trump administration has openly discussed trying to drive a wedge between Beijing and Moscow, the people close to Beijing’s decision-making said. Moving ahead with the stalled pipeline could help solidify those ties.

To be sure, even if an agreement on the pipeline is reached, analysts estimate its construction will take at least five years, similar to the original 1,800-mile long gas link. Other significant hurdles remain, including a disagreement on gas pricing and the considerable investment required for the large-scale construction.

Another sticking point is China’s demand for ownership stakes in the project, a concession Russia has been unwilling to make. The disagreements are ultimately a sign of mistrust that has lingered between the two countries—despite what Putin and Xi once declared was a “no-limits” friendship.

US strikes only delayed Iran’s nuclear progress, says intelligence report

Leaked assessment casts doubt on Trump’s claims to have ‘obliterated’ facilities

The US air strikes on Iran set back its nuclear progress by less than six months, according to an early US intelligence assessment that casts doubt on Donald Trump’s claims to have “obliterated” the programme.

The findings of the preliminary report into the attack by the Defense Intelligence Agency, described by some US media, came just three days after the US president authorised the bombing of Iran’s most important nuclear sites.

The DIA’s findings, revealed on Tuesday by CNN and others, were furiously rejected by the White House and the Pentagon, which stood by Trump’s judgment that Iran’s nuclear programme had been destroyed.

In a post on his Truth Social platform late on Tuesday, the US president reiterated his claim that Iran’s nuclear sites were “COMPLETELY DESTROYED”.

“FAKE NEWS CNN, TOGETHER WITH THE FAILING NEW YORK TIMES, HAVE TEAMED UP IN AN ATTEMPT TO DEMEAN ONE OF THE MOST SUCCESSFUL MILITARY STRIKES IN HISTORY,” he said.

White House press secretary Karoline Leavitt said on X that the “alleged ‘assessment’” had been leaked by “an anonymous, low-level loser in the intelligence community”.

Leavitt added: “Everyone knows what happens when you drop fourteen 30,000 pound bombs perfectly on their targets: total obliteration.”

The report’s findings will raise questions about the merits of the US military strike, which involved B-2 stealth bombers and submarine-launched missiles hitting Iranian nuclear sites at Natanz, Isfahan and Fordow, a facility buried half a kilometre underground.

Iran has repeatedly said that its nuclear programme is for civilian purposes. US intelligence earlier this year also said that Iran was not building a bomb, although Trump rejected that assessment.

“Based on everything we have seen — and I’ve seen it all — our bombing campaign obliterated Iran’s ability to create nuclear weapons. Our massive bombs hit exactly the right spot at each target — and worked perfectly,” US defence secretary Pete Hegseth said.

“The impact of those bombs is buried under a mountain of rubble in Iran; so anyone who says the bombs were not devastating is just trying to undermine the president and the successful mission,” he added.

The DIA is part of the US Department of Defense.

On Tuesday, the Trump administration postponed a classified briefing for US lawmakers to discuss the outcome of the strikes, drawing fury from Democrats.

Chuck Schumer, the top Democrat in the Senate, described the postponement as “outrageous”. He added: “They’re bobbing and weaving and ducking. Senators deserve full transparency.”

Pat Ryan, a Democratic congressman from New York and member of the House armed services committee, claimed Trump had cancelled the briefing because “his team knows they can’t back up his bluster and BS”.

The growing debate in the US about whether the mission succeeded came after Iran’s president said Israel had failed to destroy the country’s nuclear sites and knowhow.

Masoud Pezeshkian said in a late-night address to his nation on Tuesday that “the aggressor enemy failed in achieving its sinister aims which were destroying facilities, declining nuclear knowledge and social unrest”, according to state media.

The president added that, while Iran suffered loss of life during 12 days of war with Israel, the damage suffered by Israel was “beyond imagination”.

However, in a pre-recorded address on Tuesday night, Israel’s Prime Minister Benjamin Netanyahu backed up Trump’s claims, saying the Israeli and US bombing campaigns had brought Iran’s nuclear programme to “ruin”.

He also threatened to “act in the same way” if Iran tried to rebuild it.

Why art dealers are up in arms at the EU’s new anti-terror legislation

Cultural property laws that come into force this week have been condemned as ‘stupid’ and ‘absurd’

While art dealers fret about possible US tariffs, less discussed but very real EU cultural property laws come into effect this week. These aim to prevent trade in illegally exported goods but risk drowning the market in needless and costly bureaucracy, according to dealers and other market experts.

“Regulation is not a sexy topic. It’s more exciting to talk about a scandal than a sector that is being victimised, but the art and antiques trade is being victimised,” says Erika Bochereau, secretary general of CINOA, a confederation of more than 5,000 art and antiques dealers worldwide.

The European Union’s so-called 2019/880 legislation, which comes into force on June 28, was conceived to stop stolen or looted works, particularly those used to fund terrorism, from entering the EU. Objects more than 200 years old which originated from a country outside the EU will now need, at the least, a declaration of their legitimate export. The law applies to all items valued at more than €18,000 (including costs such as sales taxes, shipping and auction house fees), so anyone outside the EU with a collection of, say, English 18th-century portraits, Chinese antiques or pre-Colombian sculptures, needs to find evidence of legal export for each object before importing it into the EU, for display or for sale. There are even more stringent regulations for archaeological objects more than 250 years old. 

“It is a totally understandable motivation to protect cultural property being moved around by unsavoury characters but, quite frankly, these regulations are totally excessive and absurd. There has never been a need to keep the paperwork once something has been legally exported, if there even was any,” says Pierre Valentin, co-head of art law at London-based law firm Fieldfisher. As Bochereau puts it, “you might have things in your house that you received from your grandmother and you don’t know where she got them, but that doesn’t mean they were stolen.” 

Also of concern is the onus on the owner, who must sign a legal declaration that the item in question was legally exported. This means they “must know which country was the country of origin when the original export took place and what the local law was at the time, or that none existed,” explains Ivan Macquisten, who advises trade associations. It is “quite a terrifying statement”, says Charis Tyndall, director of the London antiquities and modern art gallery Charles Ede. “I’m sure people will get used to it, but right now it is a bit of an issue for anyone who just wants to buy something even with good provenance.”

Tyndall says the trade will ultimately adjust — “where there’s a will, there’s a way” — but for dealers based in the EU who specialise in works from outside, the incoming law is already taking its toll. “The stupid regulation will kill a lot of art galleries,” says Christian Deydier, a Paris and Hong Kong dealer of Asian art, notably Chinese archaic bronzes. He is closing his business in France this year, partly because of 2019/880. “I am not the only one leaving,” he says. “People are going to New York, Switzerland, the UK too, but I am the only one to speak up. This bureaucracy was not what the EU was meant to be for.”

The market is small within the scheme of things — average dealer turnover of antiques totalled $1.9mn in 2024 and old masters (1250-1821) at $4.8mn, while sales of postwar art alone were at $9.4mn, according to the latest Art Basel & UBS report. This finds too that average sales for the antiques trade fell 11 per cent in a “challenging” 2024. Bochereau says things have not improved much since: “If you ask most art dealers in every field, it not that easy to sell anything at the moment.”

Fairs in the EU that specialise in older art have their work cut out. There is an exception within the law that means items can come in temporarily, but this wouldn’t cover a work that then gets sold to a European buyer. “The process could take up to five months, why would you bother [as a buyer]? And if the work is refused for some reason, could it be seized while on EU ground?” Tyndall asks. 

Maybe 50 years ago the art market wasn’t as clean as it is today but now it is a business like any other

Will Korner, head of fairs at the prestigious Tefaf, says that such questions “are a big part of my life these days”. The devil is in the detail, quite a lot of which is yet to be defined. “It will be up to each national authority to apply the law and we don’t know how exactly it will work. Final guidance [from the EU] only came in the past few weeks and there are still different answers from the Dutch customs, the French authorities and the European Commission, for example,” he says. Changing the legislation is not on the cards, he says; he sees Tefaf’s role, alongside CINOA, as “making sure people understand about the implementation”. The situation “doesn’t suggest discontinuing the fair in Maastricht or its future in the EU”, he says.

Korner recognises the “noble aims” of the legislation but does not see “how its application will have a huge impact” on what it hopes to resolve. Others note that evidence of the art trade’s links to terrorism financing are slim, at best. “Nobody has the statistics,” say Bochereau. “Maybe 50 years ago the art market wasn’t as clean as it is today but now it is a business like any other, with hundreds of laws already and the transparency of the internet. The art market just has an image problem.”

There are scant verifiable figures for the value of the illicit trade in cultural property. Unesco raised alarm bells in 2020 when it put this at nearly $10bn a year, a figure that is heavily disputed by the trade (the figure would represent more than 17 per cent of the total art market). The EU Commission’s website cites an unnamed study that estimates the value of such illegal trade between €2.5bn-€5bn a year, though it notes that the value is “difficult to assess, since it is a criminal activity”. 

The law has been welcomed in some corners. Vera Carasso, director of the Dutch Museums Association, told the Netherlands press: “In the past, many art objects were traded illegally. This way of working provides more control,” adding that the associated administrative and financial burdens are “unavoidable”.

An EU Commission spokesperson did not respond directly on whether claims around the trade’s links to terrorism had been satisfactorily proved. They say that its regulation “was adopted in 2019, which gave market participants a six-year period to prepare for the introduction of the licensing requirements” and that “importers following the rules will not face difficulties obtaining the necessary (online) import licences or filling-in (again, online) importer statements.”

Market players are yet to be convinced and see repercussions that go beyond the trade. “We are not as big as the modern and contemporary art market, but we still have important roles,” says Tyndall. “If it wasn’t for dealers, where would museums and private collections source their works? Imagine if they couldn’t have things that were more than 200 years old, a lot of knowledge would disappear.” Deydier’s vision is of a future comprised of only conceptual art by the likes of Maurizio Cattelan: “It won’t take long to destroy the market. There are already very few real collectors now. They will all just want to buy bananas.”