The famous face of Holocaust-era art restitution — Klimts majestic Portrait of Adele Bloch-Bauer I, handed over by the state of Austria after a prolonged legal battle, only to sell for a staggering $135 million — now reigns calmly over Ronald Lauders Neue Galerie collection in New York. Yet its tortured path to restitution serves as a cautionary tale to all quarters of the art world, including the legitimate heirs of those who perished in the Holocaust and left behind hundreds of thousands of works of art. To many, the story of Adele Bloch-Bauer I represents the need for a more uniform and efficient means of handing over these works. To others, including such leading voices in the art world as former Royal Academy of Arts Exhibitions Secretary Norman Rosenthal, it exemplifies the need to close the door on this chapter and suspend the process of restitution altogether.

Last month, at the Holocaust Era Assets Conference in Prague, held June 26–30, art-world representatives gathered with 46 state delegations to address these issues, as well as other unresolved Holocaust-era issues such as restitution of Jewish communal property and the current needs of impoverished survivors, and assess the progress of art restitution since the watershed 1998 Washington Conference on Holocaust-Era Assets. The Prague conference concluded with the signing of the Terezin Declaration, which reaffirms the principles of the Washington Conference, and the inauguration of the Terezin Institute, which will serve as a non-binding mechanism for monitoring the effectiveness of restitution efforts.

The 1998 Washington Conference formally recognized, and elevated the importance of, this much-neglected, and perhaps conveniently ignored, casualty of the Holocaust. During Hitler’s reign, more than 650,000 artworks were either looted or confiscated by the Nazis from their Jewish owners. In addition to outright theft, Jews seeking to flee or merely subsist were often forced to sell works at fire-sale prices or to entrust them to friends, dealers, or museums for safekeeping until they returned, which in most instances did not occur. While art looting may seem secondary to the human toll of the Holocaust, a central goal of Hitler’s genocide was to erase the cultural identity of European Jewry. As historian and restitution expert Marc Masurovsky noted at the recent conference, as a result of the war, Jews’ artistic legacy, like their presence in Europe, “was amputated.”

The principles — or goals, really — put forth by the 1998 conference include the identification of art confiscated but not yet restituted, the publicizing of such works, the opening and accessibility of public and private archives, the encouragement of heirs to come forward, and the achievement of “just and fair” solutions.

However, as Lynn Nicholas, the historian and author of The Rape of Europa: The Fate of Europe’s Treasures in the Third Reich and the Second World War, points out, “While the D.C. principles are morally admirable, they are not laws.” Indeed, the Washington Principles are not legally binding, and as a result, despite the publicity surrounding such high-profile treasures as Adele Bloch-Bauer I, only about 3 percent of the 650,000 works have actually been returned. Stephen Knerly, counsel to the Association of Art Museum Directors, said during the conference that the 200 or so member museums of the AAMD have restituted only 16 pieces since 1998, eliciting an audible gasp from the audience.

Especially since the 1998 principles are not legally binding, finding alternative solutions seemed a main aspiration of the Prague conference, and the desire to remove restitution from the legal sphere was clear. Some serious accusations were hurled during panels on restitution and legal issues, and at least one museum director and more than a few lawyers were called outright liars. In interviews and conversations with participants, even the most minimal prodding stoked these simmering tensions.

One of the most hotly targeted figures was Graham Beal, director of the Detroit Insitute of Arts, who said, “I don't think I have [ever] been called a liar so much in such a short period of time.” Beal was accused of walking out in the middle of a negotiation meeting over a questionable work, an account Beal says is not true. Beal also defended the AAMD to ARTINFO, saying that member museums have returned or made settlements in the cases of “more than 16” but still fewer 30 works, and that the seemingly paltry amount is due in large part to the fact that most Holocaust-era looted works never made it out of Europe. According to Masurovsky, however, many museums have approached the restitution effort halfheartedly, publishing heavily edited lists of their collections and otherwise not fully complying with the transparency goals of the Washington Principles.

Many at the conference find it unfortunate that high-profile legal disputes over popular or blue-chip paintings have come to characterize the public image of Holocaust restitution, as in reality, the overwhelming majority of restitution claims bear little resemblance to them. One restitution expert, Jacques Lust, called it the “Tyranny of the Masterpieces.” The backlash to restitution, such as Norman Rosenthal’s insistence that we put the past behind us and assertion that current-day heirs are capitalizing on the terrible fate of their forebears at the expense of museum collections, has undoubtedly arisen at least in part as a result of these unrepresentative cases. Most art that heirs wish to see returned is not on display, not particularly valuable, and is mainly of sentimental and symbolic worth to its owners.

While individual signatory nations and many leading museums have failed, for the most part, to uphold the Washington Principles, the 1998 conference has had a significant impact on the practices of the major auction houses. According to Masurovsky, “Auction houses have made significant efforts to fix the errors of the past.” Both Christie’s and Sotheby’s now have restitution specialists and due diligence programs in place that minimize the risk of selling looted art. As Lucian Simmons, Sotheby’s senior vice president and head of restitution, pointed out, in a perhaps rare case “where commercial interests strongly coincide with ethical interests,” there is a “strong commercial interest not to sell looted artworks.” Indeed, both houses seem to have benefited financially from their efforts, since buyers feel more secure knowing they are investing in work with good title.

In the instances where their research has revealed shaky provenance, the houses have worked with the consignors to decide whether and how to seek out legitimate claimants. Consignors and claimants, with the aid of the auction houses, often the New York State Banking Department Holocaust Claims Processing Office, and almost invariably, lawyers, have reached several different kinds of resolutions, including joint sales with a split of the proceeds.

Unfortunately, Christie’s, Sotheby’s and Austria’s Dorotheum remain the exception in the art market, and smaller houses and private dealers, lacking either interest or resources, have yet to implement such restitution and provenance mechanisms. In one instance, a work that Sotheby’s rejected due to its problematic Nazi-era provenance was later sold by its owner in a private sale. Masurovksy lamented that “no one asks questions when it comes to private sales.”

Still, apart from the obvious moral reasons for not buying or selling Holocaust-era looted artwork, the financial incentive for not doing so, and for conducting one’s own due diligence when buying art, is clear — one does not want to acquire a work with questionable title, lest it become mired in costly litigation and restitution claims down the road.

Indeed, there often seems no real escape from the lawyers, and so along with alternative dispute resolutions, a more clearly defined legal approach is still necessary. As Michael Kurtz, assistant archivist of the U.S. National Archives and Records Administration, noted, “Individual cases continue to rise, so where do we go from here?” Both he and Marc Masurovsky have insisted on the need for a new framework that can deliver legal certainty. To that end, in May of this year, Masurovsky and a few other like-minded mavericks, concerned that the Prague conference might only yield empty promises, gathered in Krakow to draft their own resolution, which Masurovsky unexpectedly presented at the conference. This Krakow resolution seeks to uphold the tenets of the Washington Principles but also tackles the most problematic issues that confront restitution: including member nations’ use of legal technicalities — including statutes of limitation, inheritance laws, conflicts of law, and national cultural property laws — to fight claims.

When asked whether this renewed commitment to restitution will stop art-possessing nations from hiding behind these technicalities, former ambassador and Under Secretary of Economics, Business and Agricultural Affairs for Bill Clinton, Stuart Eizenstat — one of the main forces behind the original Washington Conference and the formal restitution effort in general — replies that “ultimately it rests with each nation to apply its laws and deem when they are appropriate.” He adds that while the Terezin Declaration emphasizes a moral imperative and alternative dispute resolutions, it does not preclude technical defenses. Therein lies what, to many attendants of the Prague conference, is the main failing of the event — its inability to ensure accountability on the part of member nations and cultural institutions. As Michaela Sidenberg, visual arts curator at the Jewish Museum in Prague, views it, since the Terezin Declaration will also have no legally binding authority, money invested in the new Terezin Institute would be better spent on grants for further provenance research that could more effectively make inroads into the murky netherland where those hundreds of thousands of works still lie.