Two galleries have withdrawn from the Art Basel Hong Kong fair amid ongoing protests in the Asian city, artnet News has learned.

The galleries, which asked to remain unnamed, are exceptions rather than the rule: Of the more than 50 exhibitors we reached out to (of the 242 that attended last year), the vast majority said they are moving ahead with plans to participate, but are monitoring the constantly evolving situation closely. A spokesperson for the fair told artnet News it currently has no plans to “postpone or relocate our 2020 show.”

The protests in Hong Kong took a new turn on Friday, as the territory’s chief executive, Carrie Lam, activated a colonial-era prohibition on wearing face masks at protests—a rule that had not been invoked since 1967. Authorities formally charged two protesters with violating the rule on Monday, the Guardian reports.

The move was designed to help quell the demonstrations that have rocked the city since June, when a now-withdrawn extradition law sparked a wave of anti-government protests that have evolved into broader calls for democracy and investigations into the use of police force. Last week, police fired a live round at a teenage protester at point-blank range.

But instead of calming the unrest, news of the anti-mask ordinance only added fuel to the protests, according to the AFP. Thousands of protesters flooded the streets on Friday and over the weekend, according to reports, including in the Central neighborhood where many blue-chip galleries are based. They tore down and burned a banner celebrating 70 years of Chinese Communist Party rule, which the mainland is marking with parades and festivities this fall.

A woman holds up an umbrella and a license plate that reads “love” during a protest in Hong Kong. Photo by Nicolas Asfouri/AFP/Getty Images.

Damage Control

So far, Art Basel Hong Kong—the most important market event in the region—is proceeding as planned, although organizers are working overtime to allay exhibitors’ nerves.

“With several months to go until our scheduled show opens in late March 2020, we feel it is too early to speculate as to what the situation in Hong Kong will be like then,” an Art Basel spokesperson told artnet News. “In spite of the current situation, Hong Kong continues to be the best location to host our fair in Asia—with its leading position as a financial center of the continent, as well as its thriving local cultural scene.”

In London last week, Marc Spiegler, Art Basel’s global director, was spotted making the rounds at Frieze on Thursday, encouraging exhibitors to hold off making a decision about whether to participate or withdraw. Multiple dealers told artnet News that the fair’s organizers had reached out to them—either in person, over e-mail, or by phone—to discuss the state of affairs in recent weeks.

According to one dealer, organizers likened the current situation in the Asian city to the yellow vest protests that swept Paris last fall, claiming that it was business as usual during the week and that clashes between protesters and police were restricted to particular neighborhoods on the weekends.

The exhibitor list for the 2020 fair has not yet been made public, though an Art Basel spokesperson says it is on track to be released on schedule in late October. Many longtime participants are in the midst of planning their displays; a number have already booked flights.

In its statement, Art Basel emphasized that galleries and auction houses have been continuing to conduct business as usual in the city. (In fact, a major new record for Yoshitomo Nara was set in Sotheby’s contemporary art sale in Hong Kong on Saturday.) “That said, we do understand that the situation is nuanced and constantly changing, so we will continue to monitor the situation closely and remain in close contact with all our exhibitors,” the spokesperson said. “The safety of our staff, exhibitors and visitors will remain our top priority as always.”

Protesters break into the government headquarters in Hong Kong on July 1, 2019, the 22nd anniversary of the city’s handover from Britain to China. Photo: Anthony Wallace/AFP/Getty Images.

To Go or Not to Go?

Opinions differ on which is the greater risk: participating in the fair or sitting it out.

Dealers say they anticipate that far fewer collectors from mainland China will attend out of fear of discrimination or reprisal, reducing the buying power of the collector base significantly. Since August, tourism to Hong Kong has plummeted almost 40 percent, according to the Financial Times, and retail sales have dropped by around a quarter compared to 2018.

“What’s certain is that there will be fewer collectors from mainland China and elsewhere who are concerned to travel there, we already know that,” says Lisa Spellman of 303 Gallery. Nevertheless, she plans to attend to continue to cultivate the local market. “Right now,” she notes, “we are thinking about how we’ll adjust our presentation accordingly.”

At a time when profit margins for small and midsize dealers remain thin, the stakes are high: A successful fair can be the difference between a profitable year and a bad one. One gallerist said the hefty cost of travel, booth fees, and shipping, combined with the uncertainty of whether top clients would attend, has made the Hong Kong fair increasingly unappealing. But other galleries are loath to pull out because they do not want to lose their spot in the future; Hong Kong remains an important market and gateway to the rest of Asia.

Multiple dealers also expressed anxiety about the optics of attending the fair—few want to cross a picket line of protesters and police. Although Gerd Harry Lybke of Galerie Eigen + Art currently plans to participate, he says: “For me, it’s more a question of politics and human rights [than the market].”

Other dealers remain unfazed and firmly committed to both Hong Kong and the Basel brand. “We are completely supportive of the region and completely supportive of what Basel is doing,” says Rachel Lehmann of Lehmann Maupin. Dealer Kamel Mennour says he is “monitoring the situation in Hong Kong” and remains “cautious about changing political and economic circumstances.” But he notes that “we have been participating in the fair for many years and have great faith in the Art Basel brand.”

Gallerists with permanent spaces in Hong Kong acknowledge that the situation is serious, but remain bullish on the vitality of the region. Simon Lee, which has an office in Hong Kong, closed once over the summer as a result of the protests. “Galleries like ours with pied-à-terre have an easier decision to make,” a spokesperson for the gallery notes. “But it’s understandable that galleries from abroad cannot afford to take the risk.”

Read Art Basel’s statement on the situation in Hong Kong in full below.

We are following the recent protests in Hong Kong, SAR closely. With several months to go until our scheduled show opens in late March 2020, we feel it is too early to speculate as to what the situation in Hong Kong will be like then.

In spite of the current situation, Hong Kong continues to be the best location to host our fair in Asia – with its leading position as a financial center of the continent, as well as its thriving local cultural scene. As such, we do not have any plans to postpone or relocate our 2020 show. In fact, we are actively moving forward and will be announcing our exhibitor list in late October, as usual, and we remain confident that we will be able to deliver a show of the highest quality in 2020.

This fall, we have seen that the art scene in Hong Kong has continued business as usual in the city, with gallery openings and auctions proceeding as expected. That said, we do understand that the situation is nuanced and constantly changing, so we will continue to monitor the situation closely and remain in close contact with all our exhibitors. The safety of our staff, exhibitors and visitors will remain our top priority as always.