Christie's is first foreign auction house to get Chinese nod

Christie's will become the first international auction house to operate independently in mainland China, and will have its first sale in Shanghai this autumn.

China's art market has boomed in recent years and it has overtaken the United States to become the world's largest art and auction market.

The move allows Christie's to sell directly to a growing class of wealthy collectors in China, many of whom have been spending huge sums of money in recent years to buy fine art, wine, watches, jewellery and other items at auctions around the world.

Sotheby's and Christie's have been operating in Hong Kong for a long time, and have seen their business explode in the city, which is governed independently.

But the world's two biggest auction houses have long sought greater access to mainland China to cultivate collectors, hold auctions and compete with China's own formidable auction houses, Poly International and Guardian, two state-run entities that have recently moved into the ranks of the world's biggest auction houses.

Last year, Sotheby's formed a joint venture in Beijing with a state-owned Chinese company called Gehua Cultural Development Group to hold auctions in China.

Now, Christie's has signed its own agreement with the city of Shanghai, and plans to hold its first auction this fall, though the company said the agreement restricted Christie's from dealing in ''cultural relics''. The company can operate throughout China, but will be based in Shanghai and pay taxes there.

In a statement released Tuesday, Steven P Murphy, the chief executive officer of Christie's, made clear how important China is to the auction house's future.

''In recent years we have seen phenomenal developments take place in the global art market, particularly in China, where the market has grown at an unprecedented rate,'' he said. ''Today's announcement further solidifies Christie's position and commitment in a market which possesses a strong heritage and deep appreciation of art.''

Last year, revenue in China's art and auction market was about $4.5 billion, down sharply from $9.3 billion in 2011, when the market was booming.

But China's home-grown auction houses have also been plagued by fakes, smuggling and long-standing suspicions of price manipulation.