Ivory commentary- WSJ outlook

phil dade

AzB Silver Member
Silver Member
The folling appeared today in the Editorial section of the WSJ. I thought it would be of interest to many:

OPINION
Grandma's Cameo Becomes Yard-Sale Contraband
How will a government ban on selling or trading antique ivory help save endangered elephants?


By JOHN LEYDON
June 23, 2014 6:52 p.m. ET
On June 26 countless antiques, musical instruments and other objects made from ivory or decorated with it will be effectively banned by the federal government from sale or trade within the U.S. Coupled with tough new international import-export restrictions, the value of these objects, once in the hundreds of millions of dollars, will evaporate.

The expressed aim of the U.S. Fish and Wildlife Service is to discourage the ivory trade and protect endangered African elephants, though it is difficult to discern how that effort is aided by attacking, say, collectors of Victorian or Art Deco treasures.

To avoid having the ban termed a "blanket prohibition," which would require congressional legislation, the Fish and Wildlife Service has granted a "regulatory exception" that covers a minuscule number of ivory-laden objects that can meet its elaborate requirements. In addition to proving that a particular object is at least 100 years old, its owner must possess official paperwork showing that it was imported to America before 1990, or legally thereafter, and provide unspecified evidence that the object has not been repaired or modified since December 1973. In other words, the bar has been set so high by the Fish and Wildlife Service that very few items will qualify, and then only at great expense and months of research and bureaucratic wrangling.

The message is clear to those who possess ivory-detailed objects including clarinets, canes, pistols, crucifixes, timepieces, chess sets, cameos, guitars, mahjong sets, pianos or furniture: You own it, you're stuck with it. The objects shortly will be worthless and uninsurable by government decree, and the IRS is unlikely to allow you to write it off as an investment loss, no matter how much you or your family paid for it—a few hundred dollars at an estate sale or $20,000 at Christie's.

The impracticality of monitoring every flea market, auction and estate sale in the country will force the Fish and Wildlife Service to selectively enforce the new regulations. Worse, many buyers and sellers—from hobbyists to professionals—may be unaware that they will be vulnerable to confiscation, fines and arrest for violating the new regulations.

When the Fish and Wildlife Service does step in to prosecute owners and confiscate the ivory goods, it will be doing so in the misguided belief that it is helping to save endangered elephants in Africa by demonizing all ivory, no matter the vintage. As someone who collects ivory-detailed walking canes and who counts himself as a dedicated environmentalist, I think the government is overreaching by creating this new criminal class.

If you see the increasingly common signs saying "Support the Ban," remember that the new federal rule is not directed against the brutal mercenaries and terrorist organizations whose present-day poaching is endangering the last remaining members of a magnificent African species. The domestic ban is aimed indiscriminately at you or your family or your neighbors, and at heirlooms, collections and investments.

Conservation organizations and lovers of cultural treasures must work together to stop the tragedy unfolding in Africa by supporting forceful interdiction efforts. A first step toward encouraging such a sensible alliance might be for Congress to impose a time-out on the Fish and Wildlife Service, delaying the implementation of its misguided ban and giving thoughtful people who understand its impact, and its folly, more time to weigh in.

The House Subcommittee on Fisheries, Wildlife, Oceans and Insular Affairs is scheduled to meet Tuesday to discuss the domestic ivory ban. Let's hope our elected representatives can bring some sense to the discussion and reverse this new and faulty regulation.

Mr. Leydon, a retired telecom executive, is a member of the International Society of Cane Collectors and a staunch supporter of international wildlife conservation organizations.
 
Great letter, lets hope there are some level thinking members left in Congress...

Joel Hercek

Where are you if you have cues with ivory on them. I have several cues with ivory and nothing that speaks to the provenance of the ivory on them. Will the makers of the cues have to show that they have evidence that the ivory is legal?
 
Please realize this is one man's opinion as expressed and published today in the editorial/opinion section of the WSJ. I believe it is an exaggeration to say items would be worthless, but necessary to emphasize his point that this ban, as written, does nothing to save Elephant poaching.

My company, (Branded Women's Shoes made in China) deat with the US Fish and Wildlife Service) for years. From time to time we made shoes out of certain snake skin which required special paperwork/documentation filled out by our agent in China. The USFW Service would randomly hold our merchandise, inspect at their leisure, many times resulting in lenghtly delays which cost lost sales, cancellations, or mardown assistance for the retailer to accept a shorter selling period. Maybe there was an error on our part once or twice in 17 years. Dealing with this agency may be more difficult than the IRS. However, the USFWS never lost any e mails.
 
I posted about this in NPR about a month ago.

Cue makers and cue collectors don't seem to be concerned...........
 
Would making an inlay or ferrule be considered "modifying"?

If the Fish and Wildlife Service wants it to be. Regulations are written very ambigously so they can be applied at the regulators discretion. Speak out against a controversial government policy...and you'll find out what "discretion" means (See IRS).



I posted about this in NPR about a month ago.

Cue makers and cue collectors don't seem to be concerned...........

I'm not concerned when I drive 70 mph...until the 1-in-10,000 chance happens that I get a ticket. Same thing will happen here, except the penalties will be substantial (fine + loss of cue + attorney fees +)


Great letter, lets hope there are some level thinking members left in Congress...

Joel Hercek

That's a joke, right? You forgot the :D
 
Unfortunately bdoorman is very correct. The Fish and Wildlife Service will determine what will be will be. Our experience is they are not accomodating in the least way.
 
So based upon what is the uncertainty of what will happen with de facto enforcement, it sounds like it would be smart to gather ye cues while ye may before it stops being entirely possible. And then do not transport the cues out of the USA and enjoy the cues for the sheer sake of their beauty and playability......if investment was a main objective, well, it doesn't sound very promising.

The one thing the regulation allows is that possession of an artifact containing ivory, of and by itself, is not illegal and you don't have to worry about confiscation of the item. It's the selling of the item or transportation out of the USA and I believe the regulation refers to the commercial sale of ivory. U.S. Fish & Wildlife has told me twice (separate conversations with different persons) that simple possession of my pool cues is not in conflict with the regulation and is perfectly legal to own and possess.

Obviously, the regulation addresses the sale of ivory and would anyone know what the regulation says about the risks to the buyer if commercial resale of the pool cue is not and never was the intent of the buyer who solely acted as a collector which involved purchasing the cue?

Anyway, the ambiguity I think is the law does not say anything that I spotted with a quick browse about the exchange of ivory, as contrasted with the sale of the ivory. Now I admit this is a stretch but let's say I want to trade my cue with you and one of us obviously winds up with a cue with ivory. Let's say one cue is a original Balabushka with MOP and sans ivory while the other cue is loaded with ivory......but there's no cash exchanged......cue for cue......how would that violate the regulation?

As I know it, barter is the exchange of goods or services for other goods or services without using money as means of purchase or payment. So basically it is the direct exchange of goods between two parties in the transaction and the commercial sale of ivory never enters into it.....as least as I see it, especially when one of the parties to the swap/exchange is a private collector whole sole intent in acquiring the cue is for addition to a collection and there is no contemplation whatsoever at the time of acquisition to ever engage in the commercial sale of the cue.

Hey, I could be in left field but I could argue this point pretty strongly.......but like others have pointed out, that wouldn't matter a tinkers dam.....so personally, I'm getting my ivory cues now while I still can. "Obladee Obladaa" but meanwhile, I'll support any on-going effort to get the regulation modified and do whatever I can to persuade elected officials this new regulation is unfair, financially detrimental to small business owners, namely pool cue-makers, and punitive to collectors of artifacts.

In the interim, I'll look to the big fish in this game to tell us minnows what's happening and what we can do to help.

Matt B.
 
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Let's say one cue is a original Balabushka with MOP and sans ivory and the other cue is loaded with ivory......but there's no cash exchanged......cue for cue......how would that violate the regulation?

A barter/trade is a sale. Any transaction in which value is traded for value, is a sale. It's just that 99.999% of all sales are "cash sales" so we don't think about the other 0.001%.

If I trade cues with you...that's a sale. If you give me a cue and I cut your lawn all summer...that's a sale. Value-for-value.
 
You're correct about quid pro quo but all things being equal, there is zero taxability under both IRS regulations and also AICPA standards for capitalized assets.
I'm just saying I am not selling you anything and you are not selling me anything. We agreed I liked your cue more than mine and you felt the same way , i.e.,
vice versa, so we swapped cues. I don't see that as a commercial sale.

You can transfer title of an asset without incurrence of a sale. An example is the creation of an ad litem trust and the resultant transfer of assets without any sale
incurrence. And since title represents ownership/control of the asset, if the aforementioned action does not constitute a sale under the law, then maybe....just perhaps
a swap might not meet the definition of a "commercial sale" under the regulation. It's a question I intend to pose to the person I originally spoke with at the Department
of the Interior in Washington, DC, as well as the special agent I previously spoke with. Since pool cues can't be registered like with other types of property or assets
that can, or must be registered, and there's no monetary exchange.... merely tit for tat....... I do not see that meeting my understanding of a commercial sale.

Now when one of those cues gets sold, that's an entirely different matter but if the cue is acquired for retention in a cue collection simply by giving you mine in return
for yours, I think it provides some wiggle room. I'm going to try and get an answer since a lot is at risk. Besides, I haven't read anything about this point before and so
maybe this is a silly notion. I could be just pissing in the wind but no sense for anyone's jeans to get wet except mine. I'm betting on the below which I recognize is an
argument to be made but better minds have made a whole lot more out of a whole lot less and prevailed in litigating opposing viewpoints.

How Are Commercial Sales Defined?

Commercial sales as a term can have various definitions. Most commonly commercial sales get
defined as the act of selling a product / service in return for money in a commercial environment.

Matt B.
 
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I thought of an interesting scenaryio and am curious as to how it would be addressed. Suppose you book a hunt and take an elephant legally as a trophy according to the exception in the regulation. You enjoy the trophy for X number of years, and decide that you no longer have room for it, or don't want it for any reason. Could that hide/ivory be "worked" and sold legally?
 
In my opinion, despite that the tusks were acquired pursuant to the stipulations set forth under the new regulation, any secondary sale fails to comply with the commercial sale restrictions
promulgated under the new regulation. As Sean Moss explained with the leopard jacket example, it can remain in the family ad perpetuity but can never be sold as doing so immediately
violates the wildlife regulations. However, you can wear the jacket in public, hang it on the wall or window & there's no question your ownership is legal but that no sales whatsoever are permissible.

Matt B.
 
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