CAP Guidance on Guide Prices and Fees

Woman looking at paintings

On 21 December 2016 the Committee of Advertising Practice (CAP) issued guidance providing clarity on how auction houses should present mandatory fees and charges when referring to guide prices.

The guidance covers:

  • How should non-optional fees be displayed
  • Do fees need to be VAT inclusive?
  • Fees calculable in advance
  • Fees not calculable in advance
  • Minimum fees
  • VAT on lots
  • What information you need to provide to consumers
  • Fees subsequently levied by vendors

It's essential that all members read the guidance thoroughly and address any concerns or questions directly to the CAP copy advice team.

Read the guidance

Guide Prices

A guide price represents the seller’s minimum expectation. It is not a valuation, and the eventual sale price might differ depending on the level of interest.

The guide price is important to consumers because it indicates the price they might expect to pay. This will allow them to budget for related costs, such as insurance. While the final price paid at auction may also be subject to mandatory fees, it may not be practical to include those fees as part of the guide price because the final selling price is unknown.

Mandatory Fees

Mandatory fees are information that consumers need in order to make an informed decision before purchasing. CAP’s guidance requires all ads to provide a clear reference to any relevant fees next to the guide price.

As there are different models for calculating fees, the guidance looks at different scenarios to try and address this. However, the guidance also recognises that in some complex areas it’s not practical to include specific information about how fees are calculated to accompany every guide price and tries to address this issue.