What are Cultural Assests or Goods? Cultural assets or goods are objects which have a great importance in a way of historical, artistic, archaeological, scientific, cultural for all humanity, or only a nation or a group.

Unfortunately, cultural assets have been changing hands for centuries as in legal or in illegal ways, thus they are being destroyed and destructed.

The estimated value of illegal art and antique trade was about 1 billion US$ in 70’s increased to 2 billion US$ in 90’s. In 1990, theft of cultural assets have become second in worlds crime type after the drug traffic and their estimation is around 2 – 6 billion US$ volume.

Only the artifacts stolen from Turkey constitutes nearly 100 million US$ annually. Quarter of all the theft took place in America and 90% of the stolen artifact have never been found, and the percentage of retrived artifacts to their original owner is around 5-10%.

CHARACTERIZATION First step of the conflict of laws is to characterize the subject to the relation. In the application and the doctrine of conflict of laws lex fori characterization is generally accepted.

Characterization of dispute in a case about cultural assets  a) * real right * (rights in rem) (is generally accepted) b) Tort (exceptional)

For example, in Elicofon case, New York Court characterized the case as a conflict of real right. Court decided that the applicable law would be the law of the country in which the property is located. In this case the defendant Elicofon bought the paintings from New York and for this reason New York law was applied.

RENVOI Rule of conflict of laws applicable to real rights (lex rei sitae) is a classical rule of conflict of laws accepted by almost all legal systems. What is more, this rule has reached in an international level. Therefore, generally the renvoi does not work in such cases.

AS A RESULT  Renvoi does not take place, if there is a foreign element in returning of the stolen cultural assets. Judge must apply provisions of substantive law of the pointed law.

LEX REI SITAE (LRS) =LEX SITUS As a general principal in Private International Law, real rights are subject to lex rei sitae (also called as lex situs). According to lex rei sitae, applicable law will be the law of the country in which the goods are located.

INTERPRETATION of LRS RULE LRS Rule accepted with different interpretations in different decisions: a) The law of the final place of the goods in an ownership transition (This interpretation is generally accepted) b) The law of the place where the goods were located during the case (This interpretation did not find much application place)

Advantages of LRS First of all, LRS provides foresight. Ownership will be applied according to the law of the country where the goods are located so parties may foresee which law will be the applicable one.

In the meantime, LRS has a control over the movables. So that the forum courts or officials can give decisions like distraint, interim injunction or delivery of the good easily.

Disadvantages of LRS LRS rule based on one point that is the location of the goods, so it brings some inconvenience along. First of all, because of being a strict rule LRS does not take into consideration of different purposes of different laws.

Secondly, there might be no relation between legal transactions and lex situs. For instance goods may be located there temporarily or coincidently. The application of lex situs which has a weak and temporary relation with legal transaction is unacceptional and criticized even for normal goods.

CHANGE OF STATUS Passing movable goods from one situs to another situs means “change of status”.

Vested rights which have been gained according to the previous situs will still be valid in new situs in principal. Case of Winkworth v. Christie’s is a typical example for this. Collection was being stolen from England and was taken to the Italy and was sold there. Then it was brought back to England but still the ownership was on the Italian owner and for that reason this right could not be abolished when the artifact came back to Italy and real owner Winkworth could not take the real credit for that.

APPLICABLE LAW TO REAL RIGHTS ON TRANSPORTED GOODS (RES IN TRANSITU) If goods are in transit, LRS rule will lose its application as this situation of finding place of movable remains unknown or even if it’s known this place will be co-incidental or temporary. From this angle another connecting rule is made instead of LRS rule.

Generally accepted opinion is applying the law of the destination place (res in transitu).

In Goldberg case the court made an analysis of rules of Switzerland conflict of laws rules. Switzerland court accepted the rule of res in transitu so that the Indianapolis laws will be the applicable law to the relation.

According to the Court, mosaics were transported from Munich to Geneva and kept in Geneva Airport for four days before it sent to Indianapolis. Mosaics were in Switzerland temporarily. For this reason it was accepted that the mosaics were being transported and the law of the place of destination should be applied which is Indianapolis law in this case.

CRITICISM OF LEX REI SITAE (LEX SITUS) RULE Although the application of the lex rei stae (LRS) rule resulted in the favor of the real owner in Elicofon case, in Winkworth case it resulted in favor of the good faith buyer.

Reason of that is in Elicofon case New York law was applied which is favoring the real owners.However in Winkworth case Italian law was applied which is favoring the good faith of third parties. For that reason, even the connecting points are the same, substantive law may has the different provisions and this could change the result.

In Winkworth case the removal of plaintiffs’ ownership rights, resulted in questioning the validity of LRS rule in cultural assets area. Application of the LRS rule for the cultural assets strictly will not stop illegal cultural assets traffic, on the contrary this will support it. For this reason some alternatives are proposed to LRS rule.

ALTERNATIVE CONNECTING POINTS TO THE LRS RULE 1. Source Country Law (Lex Originis) It has been proposed to use the law of the source country to lessen the negative effects of LRS rule against the real owner. Meaning of the source country is the country where the theft took place.

Source country law is a positive step as a starting point. However if the substantive law of the source country does not have any provisions favoring good faith buyer then acceptation of this rule will not mean anything.

2. The Law Which Has The Closest Connection with The Relation In Goldberg case court qualified the relation as a tort and found the connection between tort place and relation as weak and determined the applicable law under the “closest connection” criteria.

Criteria of closest connection requires evaluation about events. This evaluation may change from one court to another so this criteria will cause difficulties in cases of returning the cultural assets if it is accepted as a general principal.

3. Supporting The LRS Rule With “Essential Element” Criteria “Essential element” criteria as a connecting point was proposed by REICHELT to LRS rule. According to that it should preserved as classical rule of conflict of laws. In case of a stolen or lost cultural asset, if there is no essential element that connects the relation to another law, then LRS rule should be valid.

This suggestion will not create deterrent effect on illegal trade of cultural assets. Because of this, different courts may give different decisions and that could destroy uniformity.

OUR OPINION Principal of preference or result selective method which was brought by American doctrine has affected nearly all areas in private international law starting from torts. In our opinion this method should be followed in cultural property cases too.

According to this method courts will analyze the rules suggested to follow and will choose the rule which is made to create a certain purpose when a case filed with the claim of ownership.

Rules brought to protect the real owner also aim to protect the cultural assets too. Thus, this method shall apply without regarding to lex situs or source country.

This connecting point does not base to a specific law like lex situs. The law which protects the rights of the real owner have to be chosen after the dispute occurs due to the relation in which the laws conflict with each other.

According to this method the transition of ownership for the stolen or lost cultural assets, will be subject to the law which protects the real owners’ rights.

As a concequence this method not only protects the real owner rights in every aspect of conflict of laws but also it protects the stolen or lost cultural assets too. What is more it also supports returning of cultural assets to their origin and that is why we are accepting this method.