A Disastrous Legal Decision
Baltimore District Court Dismisses ACCG Lawsuit Challenging Import Restrictions
The text of the Memorandum dismissing the lawsuit filed by the ACCG follows:
This action arises out of the seizure of twenty-three ancient Cypriot and Chinese coins
that the Ancient Coin Collectors Guild (“ACCG”) purchased from a coin dealer in London and imported to the United States. Following the seizure, ACCG filed this action “to test the legality” of import restrictions imposed on certain ancient Cypriot and Chinese coins. ACCG sued the U.S. Customs and Border Protection (“Customs”), the Commissioner of Customs and Border Protection (“Commissioner of Customs” or “Commissioner”), the U.S. Department of State (“State”), and the Assistant Secretary of State for Educational and Cultural Affairs (“Assistant Secretary for ECA”) (collectively, “the defendants” or “the government”), alleging violations of the Administrative Procedure Act (“APA”), the International Emergency Economic Powers Act (“IEEPA”), the Civil Asset Forfeiture Reform Act of 2000 (“CAFRA”), and the First
and Fifth Amendments to the U.S. Constitution. ACCG also alleges that the defendant acted “ultra vires,” and seeks relief in the form of a declaratory judgment, an injunction, and a writ of mandamus. Pending before this court is a motion to dismiss or, in the alternative, for summary judgment, filed by the defendants. For the reasons discussed below, the government’s motion will be granted.
WHAT DOES THIS DECISION MEAN TO US COIN COLLECTORS AND THE NUMISMATIC TRADE THAT SUPPLIES THEM?
The 1970 UNESCO Convention and the flawed 1983 CCPIA that implements it in the USA, have been sustained as the law of the land.
US coin collectors must realize that this decision is extremely adverse to their collecting interests, and that the archaeology lobby, in collusion with the anticollecting Kouroupas regime in the State Department, may now be expected to aggressively pursue further import restrictions that will in effect (over a period of years) make it impossible to licitly import most ancient coins into the USA.
From a practical perspective, this means that importation of ancient coins into the USA will shift from being a licit activity to an illicit activity which the US Government does not have the power or means to control. This situation poses very serious ethical questions for US collectors and dealers.
At this point the USA comprises about 50% of the worldwide market for ancient coins. Thus, decisions taken by US collectors and dealers will inevitably have significant effects upon the international numismatic market.
HOW SHOULD THE US COLLECTING AND DEALER COMMUNITY REACT TO THIS ADVERSE DECISION?
Every collector and dealer in the USA must make his or her own ethical and decision. I can only present my own thoughts as those of a well informed participant in the US ancient coin market.
I have been mulling over this possibility for quite some time, and have arrived at some very important conclusions.
First, as reported in
http://classicalcoins.blogspot.com/2011/08/coin-prohibition-historical-parallel.html
The US government, along with every other government in the world, does not presently have and cannot possibly acquire the power to enforce a ban upon trading in ancient coins. No government presently possesses or ever will possess sufficient control over its borders or postal system to prevent a relatively free illicit international trade in ancient coins from being carried on across its borders.
Thus, the effect of the import restrictions that so far have been, and in the future prospectively will be, promulgated is to impose an era of "coin Prohibition" which will inevitable prove to be just as ill-advised and futile as "alcohol Prohibition" did between 1919 and 1933.
There is one very significant difference between the coming era of "coin Prohibition" and the past era of "alcohol Prohibition." Licit possession of, and licit free trading in ancient coins within the national borders of the USA are not affected by (and cannot possibly be affected by) any regulations or agreements that the State Department, in unethical and anti-American collusion with the archaeology lobby, can unilaterally impose. Since the USA presently comprises about 50% of the international free market for ancient coins, decisions that US collectors and dealers make as to how to respond to "coin Prohibition" will have a very significant impact upon not only the free market for ancient coins within the USA, but also the free market for ancient coins worldwide.
My perspective is that we must recognize that in the absence of a comprehensive legislative solution to this problem, adversaries of private collecting have now temporarily obtained the power to legally divorce the US free market in ancient coins from the international free market in ancient coins. They have acquired the power to prevent ancient coins from licitly crossing the borders of the USA to enter that nation, and can be expected to aggressively use that power to gradually impose MOUs that will do so. Within the next ten years we can expect that the anticollecting Kouroupas regime in the State Department will negotiate MOUs with every ancient coin "source state" which will make it illicit to import ancient coins of every description into the USA.
This raises the question of how US collectors and dealers should react to such a ban on importation. It would not be per se disastrous, considering that it would in effect merely split the worldwide market in half. What would however be disastrous would be the imposition of a "check valve" that would not restrict ancient coins from being exported from the USA, but would prevent their importation. This would gradually deplete the US free market of licit ancient coins, and eventually prevent US collectors from licitly acquiring ancient coins.
I don't believe that any US collector or dealer in ancient coins desires to break the law. I personally would not consider doing so, and would transition to other lawful activities in lieu of attempting to carry on a numismatic business under circumstances rendering that business illicit. Fortunately, that is not the choice we are confronted with. Instead we must decide how to manage a numismatic trade in a situation in which there will be one licit numismatic trade for the USA, within which coins freely circulate between collections, and another licit numismatic trade for the rest of the world, within which coins similarly freely circulate.
I propose the following as a sensible, ethical, lawful and constructive approach to be pursued by the US numismatic community: no coin shall leave our borders without right of repatriation. In other words, it should not be deemed ethical for a US collector or dealer to export an ancient coin that cannot subsequently be licitly reimported into the USA.
In my opinion, widespread acceptance of that doctrine among the US collector and dealer community could well have a significant impact upon the desire of source states such as Italy and Greece to impose US import restrictions upon ancient coins.
Finally, I believe that the above proposals impose an ethical obligation upon me to propose a system of tracing provenance which will significantly alleviate (although not entirely eliminate) the effects of forthcoming import restrictions. I have previously discussed this issue:
http://classicalcoins.blogspot.com/2011/02/mania-for-provenance.html
It would be feasible to provide a system of tracing provenance which would document licit acquisition of coins by dealers and their subsequent licit acquisition by collectors. One of the key issues in doing so is that such transactions should not be disclosed to opponents of private collecting and opponents the free numismatic market. This must not become a "propaganda tool." The way to accomplish the desired result without such a transgression is to create a "coin ticket" that is not disclosed to anyone other than the collector who acquires the coin. I know how to do this, and intend to do so, and to eventually disclose the essential elements of this "coin ticket" in such a manner that they may freely be provided by every dealer, and I accept an ethical obligation to do so.
Clearly such a declaration of intent cannot be taken lightly and the necessary approach must be one which is practical for most dealers. The technical aspects are far less formidable than the ethical issues involved. It can, and soon will, be done. I cannot however guarantee its universal acceptance by every dealer.
The text of the Memorandum dismissing the lawsuit filed by the ACCG follows:
This action arises out of the seizure of twenty-three ancient Cypriot and Chinese coins
that the Ancient Coin Collectors Guild (“ACCG”) purchased from a coin dealer in London and imported to the United States. Following the seizure, ACCG filed this action “to test the legality” of import restrictions imposed on certain ancient Cypriot and Chinese coins. ACCG sued the U.S. Customs and Border Protection (“Customs”), the Commissioner of Customs and Border Protection (“Commissioner of Customs” or “Commissioner”), the U.S. Department of State (“State”), and the Assistant Secretary of State for Educational and Cultural Affairs (“Assistant Secretary for ECA”) (collectively, “the defendants” or “the government”), alleging violations of the Administrative Procedure Act (“APA”), the International Emergency Economic Powers Act (“IEEPA”), the Civil Asset Forfeiture Reform Act of 2000 (“CAFRA”), and the First
and Fifth Amendments to the U.S. Constitution. ACCG also alleges that the defendant acted “ultra vires,” and seeks relief in the form of a declaratory judgment, an injunction, and a writ of mandamus. Pending before this court is a motion to dismiss or, in the alternative, for summary judgment, filed by the defendants. For the reasons discussed below, the government’s motion will be granted.
WHAT DOES THIS DECISION MEAN TO US COIN COLLECTORS AND THE NUMISMATIC TRADE THAT SUPPLIES THEM?
The 1970 UNESCO Convention and the flawed 1983 CCPIA that implements it in the USA, have been sustained as the law of the land.
US coin collectors must realize that this decision is extremely adverse to their collecting interests, and that the archaeology lobby, in collusion with the anticollecting Kouroupas regime in the State Department, may now be expected to aggressively pursue further import restrictions that will in effect (over a period of years) make it impossible to licitly import most ancient coins into the USA.
From a practical perspective, this means that importation of ancient coins into the USA will shift from being a licit activity to an illicit activity which the US Government does not have the power or means to control. This situation poses very serious ethical questions for US collectors and dealers.
At this point the USA comprises about 50% of the worldwide market for ancient coins. Thus, decisions taken by US collectors and dealers will inevitably have significant effects upon the international numismatic market.
HOW SHOULD THE US COLLECTING AND DEALER COMMUNITY REACT TO THIS ADVERSE DECISION?
Every collector and dealer in the USA must make his or her own ethical and decision. I can only present my own thoughts as those of a well informed participant in the US ancient coin market.
I have been mulling over this possibility for quite some time, and have arrived at some very important conclusions.
First, as reported in
http://classicalcoins.blogspot.com/2011/08/coin-prohibition-historical-parallel.html
The US government, along with every other government in the world, does not presently have and cannot possibly acquire the power to enforce a ban upon trading in ancient coins. No government presently possesses or ever will possess sufficient control over its borders or postal system to prevent a relatively free illicit international trade in ancient coins from being carried on across its borders.
Thus, the effect of the import restrictions that so far have been, and in the future prospectively will be, promulgated is to impose an era of "coin Prohibition" which will inevitable prove to be just as ill-advised and futile as "alcohol Prohibition" did between 1919 and 1933.
There is one very significant difference between the coming era of "coin Prohibition" and the past era of "alcohol Prohibition." Licit possession of, and licit free trading in ancient coins within the national borders of the USA are not affected by (and cannot possibly be affected by) any regulations or agreements that the State Department, in unethical and anti-American collusion with the archaeology lobby, can unilaterally impose. Since the USA presently comprises about 50% of the international free market for ancient coins, decisions that US collectors and dealers make as to how to respond to "coin Prohibition" will have a very significant impact upon not only the free market for ancient coins within the USA, but also the free market for ancient coins worldwide.
My perspective is that we must recognize that in the absence of a comprehensive legislative solution to this problem, adversaries of private collecting have now temporarily obtained the power to legally divorce the US free market in ancient coins from the international free market in ancient coins. They have acquired the power to prevent ancient coins from licitly crossing the borders of the USA to enter that nation, and can be expected to aggressively use that power to gradually impose MOUs that will do so. Within the next ten years we can expect that the anticollecting Kouroupas regime in the State Department will negotiate MOUs with every ancient coin "source state" which will make it illicit to import ancient coins of every description into the USA.
This raises the question of how US collectors and dealers should react to such a ban on importation. It would not be per se disastrous, considering that it would in effect merely split the worldwide market in half. What would however be disastrous would be the imposition of a "check valve" that would not restrict ancient coins from being exported from the USA, but would prevent their importation. This would gradually deplete the US free market of licit ancient coins, and eventually prevent US collectors from licitly acquiring ancient coins.
I don't believe that any US collector or dealer in ancient coins desires to break the law. I personally would not consider doing so, and would transition to other lawful activities in lieu of attempting to carry on a numismatic business under circumstances rendering that business illicit. Fortunately, that is not the choice we are confronted with. Instead we must decide how to manage a numismatic trade in a situation in which there will be one licit numismatic trade for the USA, within which coins freely circulate between collections, and another licit numismatic trade for the rest of the world, within which coins similarly freely circulate.
I propose the following as a sensible, ethical, lawful and constructive approach to be pursued by the US numismatic community: no coin shall leave our borders without right of repatriation. In other words, it should not be deemed ethical for a US collector or dealer to export an ancient coin that cannot subsequently be licitly reimported into the USA.
In my opinion, widespread acceptance of that doctrine among the US collector and dealer community could well have a significant impact upon the desire of source states such as Italy and Greece to impose US import restrictions upon ancient coins.
Finally, I believe that the above proposals impose an ethical obligation upon me to propose a system of tracing provenance which will significantly alleviate (although not entirely eliminate) the effects of forthcoming import restrictions. I have previously discussed this issue:
http://classicalcoins.blogspot.com/2011/02/mania-for-provenance.html
It would be feasible to provide a system of tracing provenance which would document licit acquisition of coins by dealers and their subsequent licit acquisition by collectors. One of the key issues in doing so is that such transactions should not be disclosed to opponents of private collecting and opponents the free numismatic market. This must not become a "propaganda tool." The way to accomplish the desired result without such a transgression is to create a "coin ticket" that is not disclosed to anyone other than the collector who acquires the coin. I know how to do this, and intend to do so, and to eventually disclose the essential elements of this "coin ticket" in such a manner that they may freely be provided by every dealer, and I accept an ethical obligation to do so.
Clearly such a declaration of intent cannot be taken lightly and the necessary approach must be one which is practical for most dealers. The technical aspects are far less formidable than the ethical issues involved. It can, and soon will, be done. I cannot however guarantee its universal acceptance by every dealer.
posted by Dave Welsh at 12:16 AM
2 Comments:
It is disturbing that courts declare themselves unable to review unilateral actions of the executive branch. I was a supporter of this administration but I am increasingly willing to consider other parties and subparties more philosophically opposed to unilateral regulation imposed without transparency or public participation.
I applaud your decision to move forward with your plans to increase the amount of provenance provided when a coin is purchased. Although I am not sure how public disclosure will put us at risk, in the repressive atmosphere created by the State Department I can understand your concerns that they will pull a further nasty rabbit out of the hat.
The important thing is that the owner of the coin has enhanced provenance. As a collector such an approach would make me feel more comfortable with continuing to invest in and collect coins in this atmosphere of uncertainty.
I don't normally drink tea but I am beginning to think it is time for a tea party!! :-)
Chris Rose
Chris,
> ... I am not sure how public disclosure will put us at risk ...
Public disclosure of provenance is not necessary, except in the context of a numismatic auction where it can only be beneficial.
Every collector should create a "coin ticket" for each coin in his or her collection which will, in addition to a description of the coin, record what is known about its provenance - as a minimum when and where it was acquired.
This ticket should be 1 3/4 inches square at the largest. It can then travel with the coin in the future, being placed within the 2x2 plastic "flip" in which coins are normally sold by dealers.
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