Sotheby's is set to become the first international fine art auction house in China after signing a joint venture with a state-owned company, it said Friday.
The deal with Beijing GeHua Art Company, which is subject to government approval, will give Sotheby's a foothold in China where foreign auction houses are normally prevented from operating by law.
Sotheby's opted for the creation of a joint venture in its years-long bid to overcome the legal hurdle.
"China and its growing class of collectors has been the single most attractive growth market for the company, and collectors from this region have become a significant force in our salerooms worldwide," said Sotheby's Asia chief executive Kevin Ching.
The auction house said it would be the controlling share holder in the business.
For centuries the worldwide art market was dominated by a few European auction houses, but a revolution has seen five Chinese houses enter the top ten by revenue, according to a recent report by information specialist Artprice.
A new generation of collectors in Beijing and Shanghai has pushed China to the forefront.
And Chinese artists Zhang Daqian (1899-1983) and Qi Baishi (1864-1957) now hold the top two places in Artprice's global ranking of artists by auction revenue, ahead of Andy Warhol (1928-1987) and Pablo Picasso (1881-1973).