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SECURITIES AND EXCHANGE COMMISSION


WASHINGTON, D.C. 20549


FORM 10-Q


QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934


For the SIX months ended May 31, 2003
Commission File Number 0-16008
A.R.T. INTERNATIONAL INC.

98-0082514

5-7100 Warden Avenue, Markham, Ontario, L3R 5M7

Registrant's telephone number: (800) 278-4723


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

YES NO X
--- ---

Indicate the number of shares outstanding of each of the issuer's classes of
common stock:

Common Shares outstanding as at May 31, 2003: 25,516,780
















1


A.R.T. INTERNATIONAL INC.
INDEX TO
QUARTERLY REPORT ON
FORM 10-Q
FOR THE QUARTER ENDED
May 31, 2003


PART I PAGE [S]

Balance sheets:
As at May 31, 2003, and November 30, 2002 3-4

Statements of Accumulated Deficit 5
For the six months ended May 31, 2003
For the six months ended May 31, 2002

Statements of Loss 6
For the six months ended May 31, 2003
For the three months ended May 31, 2003
For the six months ended May 31, 2002
For the three months ended May 31, 2002

Statements of Cash Flow 7
For the six months ended May 31, 2003
For the six months ended May 31, 2002

Notes to Financial Statements 8-14


Item 2.
Management's discussions and analysis of financial
condition and results of operations. 15-17

PART II
SIGNATURES 18


















2


A.R.T. INTERNATIONAL INC.
BALANCE SHEETS
(IN CANADIAN DOLLARS)


ASSETS
6 Months Ended 12 Months Ended
May 31,2003 Nov.30, 2002
(Unaudited) (Audited)
(Note 2)
- --------------------------------------------------------------------------------

CURRENT ASSETS
Cash $ 14,318 $ 35,160
Accounts receivable 6,515 17,822
Inventory (Notes 2(a) and 4) 62,958 68,403
Prepaid expenses and deposits 7,905 7,905
- --------------------------------------------------------------------------------
91,696 129,290

CAPITAL ASSETS (Note 5) 24,080 28,080

Patents 3,931,051 3,931,051
Less: Accumulated amortization 3,931,050 3,931,050
- --------------------------------------------------------------------------------
1 1
- --------------------------------------------------------------------------------

TOTAL ASSETS $ 115,777 $ 157,371
================================================================================


























The accompanying notes form an integral part of these financial statements.





















3


A.R.T. INTERNATIONAL INC.
BALANCE SHEETS
(IN CANADIAN DOLLARS)


LIABILITIES AND STOCKHOLDERS' DEFICIT


6 Months Ended 12 Months Ended
May 31,2003 Nov.30, 2002
(Unaudited) (Audited)
(Note 2)
- --------------------------------------------------------------------------------

CURRENT LIABILITIES
Accounts payable and
accrued liabilities $ 733,433 $ 744,925
Loans payable (Note 6) 496,176 354,176
Notes payable (Note 7) 836,953 815,691
- --------------------------------------------------------------------------------
2,066,562 1,914,792
- --------------------------------------------------------------------------------

TOTAL LIABILITIES 2,066,562 1,914,792

CAPITAL STOCK (Note 8)

Class C Common 100,001 100,001
Common shares 10,495,217 10,495,217
- --------------------------------------------------------------------------------
10,595,218 10,595,218
CONTRIBUTED SURPLUS 11,775,000 11,775,000
DEFICIT (24,321,003) (24,127,639)
- --------------------------------------------------------------------------------
(1,950,785) (1,757,421)
TOTAL LIABILITIES AND
SHAREHOLDERS' DEFICIT $ 115,777 $ 157,371
================================================================================
















The accompanying notes form an integral part of these financial statements.















4


A.R.T. INTERNATIONAL INC.
STATEMENTS OF ACCUMULATED DEFICIT
(IN CANADIAN DOLLARS)



6 Months Ended 6 Months Ended
May 31, 2003 May 31, 2002
(Unaudited) (Unaudited)
- --------------------------------------------------------------------------------

Deficit - beginning of period $ (24,127,639) $ (22,628,359)
Add - net loss (193,364) (262,309)
- --------------------------------------------------------------------------------

Deficit - end of period $ (24,321,003) $ (23,890,668)
================================================================================



































The accompanying notes form an integral part of these financial statements.





5




A.R.T. INTERNATIONAL INC.
STATEMENTS OF LOSS
(IN CANADIAN DOLLARS)


3 Mths Ended 3 Mths Ended 6 Mths Ended 6 Mths ended
May 31, 2003 May 31,2002 May 31, 2003 May 31, 2002
(Unaudited) (Unaudited) (Unaudited) (Unaudited)



SALES $ 20,994 $ 41,009 $ 42,160 $ 132,897
COST OF GOODS SOLD 37,506 80,321 97,790 167,030
- ------------------------------------------------------------------------------------------------

GROSS PROFIT (LOSS) (16,512) (39,312) (55,630) (34,133)
OPERATING EXPENSESSelling general
& administrative 53,593 79,530 112,041 159,888
- ------------------------------------------------------------------------------------------------

Operating income/(loss) (70,105) (118,841) (167,671) (193,021)

OTHER EXPENSES
Amortization 2,000 1,940 4,000 3,880
Note interest 9,924 12,567 21,263 25,135
Exchange Loss 0 (12) 0 8,356
Other expenses 430 0 430 31,917
- ------------------------------------------------------------------------------------------------
TOTAL OTHER EXPENSES 12,354 14,496 25,693 69,288
- ------------------------------------------------------------------------------------------------
NET INCOME (LOSS) $ (82,459) $ (133,337) $ (193,364) $ (262,309)
================================================================================================

NET LOSS PER COMMON SHARE $ 0.004 $ 0.005 $ 0.007 $ 0.010
- ------------------------------------------------------------------------------------------------

WEIGHTED AVE.NUMBER
OF COMMON SHARES 25,516,780 25,516,780 25,516,780 25,516,780
- ------------------------------------------------------------------------------------------------




















The accompanying notes form an integral part of these financial statements





6




A.R.T. INTERNATIONAL INC.
STATEMENTS OF CASH FLOW
(IN CANADIAN DOLLARS)


6 Mths Ended 3 Mths Ended
May 31, 2003 May 31, 2002
(Unaudited) (Unaudited)
- --------------------------------------------------------------------------------

Cash was provided by (applied to):
OPERATING ACTIVITIES
Net loss for period $ (193,364) $ (262,309)
Add: Items not requiring an
outlay of cash
Depreciation 4,000 3,880
- --------------------------------------------------------------------------------
(189,364) (258,429)

Accounts receivable 11,307 26,534
Inventories - current & long-term 5,444 20,000
Prepaid expenses 0 0
Accounts payable and accrued
liabilities (11,491) (14,667)
- --------------------------------------------------------------------------------
Cash provided by (used by)
operating activities (184,104) (197,226)

INVESTMENT ACTIVITIES
Disposition/(investment)in affiliate 0 170,000
Acquisition of capital assets 0 0
- --------------------------------------------------------------------------------
Cash provided by (used by)
investment activities 0 170,000

FINANCING ACTIVITIES
Common shares issued 0 0
Loan payable 142,000 (12,000)
Notes payable 21,262 41,112
- --------------------------------------------------------------------------------
Cash provided by (used by)
financing activities 163,262 29,112
- --------------------------------------------------------------------------------

INCREASE /(DECREASE) IN CASH (20,842) 1,886
CASH, beginning of period 35,160 15,597
- --------------------------------------------------------------------------------
CASH, end of period $ 14,318 $ 17,483
================================================================================

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Interest paid in period $ 0 $ 0
Income taxes paid in period $ 0 $ 0
- --------------------------------------------------------------------------------



The accompanying notes form an integral part of these financial statements





7




A.R.T. INTERNATIONAL INC.
NOTES TO FINANCIAL STATEMENTS
May 31, 2003

(IN CANADIAN DOLLARS)

1. INCORPORATION AND OPERATIONS
The Company was incorporated in Canada on January 24, 1986, under The Ontario
Business Corporations Act. The Company's primary business is the production,
distribution and marketing of fine art reproductions.

Effective June 16, 2003, the corporation changed is name from A.R.T.
International Inc. to ART International Corporation (see note 8(d)).

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

(a) Basis of preparation of financial statements

The un-audited statements of loss and statements of cash flow of the Company for
the periods ended May 31, 2003, and May 31, 2002 have been prepared in
accordance with Canadian generally accepted accounting principles (GAAP) applied
on a consistent basis. The balance sheet at November 30, 2002 has been prepared
from the audited financial statements at that date but does not include all the
information and footnotes required by GAAP for complete financial statements.

In the opinion of the Company's management, the accompanying financial
statements contain the material adjustments, necessary to present fairly the
financial balance sheets of the Company at May 31, 2003, and November 30, 2002,
and the results of their loss and cash flow for the periods ended May 31, 2003,
and May 31, 2002, and, should be read in conjunction with the audited financial
statements for the year ended November 30, 2002. All such adjustments are of a
normal recurring nature. Interim period results are not necessarily indicative
of the results to be achieved for the full fiscal year.

(b) Inventories

Inventories, whether classified as current or long-term assets, are valued at
the lower of cost and market value. Cost is determined on a first in, first out
basis.

The Company's policy is to periodically evaluate the inventory levels of each
product in its inventory on an image-by-image basis, both in light of past sales
and estimated future sales of each product and similar products. In addition,
when the Company determines that a product line or market should be
discontinued, the inventory relating to that product line or market is written
down to net realizable value.

The purpose of these policies is to ensure that the Company's inventory
balances, net of reserves, exclude slow-moving and obsolete inventory and are
valued at the lower of cost or market value. The Company uses annual physical
inventory counts combined with an analysis of each product's preceding three
years (or for such shorter period that a particular product may have been in
existence) sales and a review of the Company's sales expectations for each


8


product to determine whether the level and value of the Company's inventory of a
particular product at a given time is excessive. These three-year periods are
deemed to be an appropriate period for evaluating the historical sales of the
Company's products, since such products are not perishable and tend to be
marketed over multi-year periods through intermittent and recurring sales
programs. In no event are amounts carried as a current asset if it is not
probable that they will be sold within one year, nor do amounts carried as
long-term inventory exceed their fair value as determined by the inventory
valuation policies of the Company as described above.

(c) Capital Assets

Capital assets are recorded at cost and are amortized at rates sufficient to
substantially amortize the cost of the assets over their estimated useful lives
on the following basis:

Equipment, Furniture and Fixtures -- 20 % declining balance.

(d) Other Assets

Patents are recorded at cost and are amortized on a straight-line basis, based
on the legal life of such intellectual property, which approximates fifteen
years.

At each balance sheet date, the Company reviews the remaining benefit associated
with the Artagraph patents to ensure that the Company will generate sufficient
undiscounted cash flows to recover their carrying cost. In accordance with this
policy, all patents at November 30, 1998 have been written down to $1.

Art reproduction rights are recorded at cost and are amortized over their
estimated useful lives on a straight-line basis over a period of three years.


(e) Translations of Foreign Currencies

These financial statements are presented in Canadian dollars.

Under Canadian generally accepted accounting principles, the translation gains
or losses arising on translation of long-term monetary items are deferred and
amortized over the lives of the related monetary item

(f) Management Representations

In the opinion of management, all adjustments necessary for a fair presentation
of the financial position at May 31, 2003 and November 30, 2002 and the results
of operations, changes in financial position and related note disclosures for
the period ended May 31, 2003 and 2002 have been made. The preparation of
financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and the reported amounts of revenues end
expenses during the period. Actual results could differ from these estimates.


9






3. DIVESTITURE OF THE BUCK A DAY COMPANY INC (BUCK).

Effective February 18, 2002, the Company sold its remaining investment in Buck
to a third party. The 2,000,000 common shares of Buck were sold at the aggregate
net price of $170,000. The proceeds were used to partially repay the loans
payable and for on-going working capital purposes.



4. INVENTORIES

Inventories consist of the following:



May 31, 2003 November 30, 2002
---------------------------------------------- ----------------------------------------------
Provision for Provision for
Obsolete and Obsolete and
Gross Slow-Moving Net Gross Slow-Moving Net
Amount Inventories Amount Amount Inventories Amount
------------- ------------- ------------- ------------- ------------- -------------

$ 100,305 $ (37,347) $ 62,958 $ 105,750 $ (37,347) $ 68,403
============= ============= ============= ============= ============= =============


5. CAPITAL ASSETS

ACCUMULATED NET BOOK NET BOOK
--------------------------------------------------------------
COST AMORTIZATION VALUE VALUE
--------------------------------------------------------------
Equipment, Furniture and Fixtures $ 358,821 $ 334,741 $ 24,080 $ 28,080
============= ============= ============= =============



6. LOANS PAYABLE - $496,176

Loans are unsecured, repayable on demand, non-interest bearing and convertible
into common shares of the Company at the market price per share on the date of
conversion.


7. NOTES PAYABLE

The notes payable bear interest at 10% and are secured by a general security
agreement over all the assets of the Company.

The note holders agreed to postpone the right to enforce their security or
collect upon the notes payable until October 12, 2002.

2003 2002
--------------------------- ---------------------------
U.S. Dollars Cdn. Dollars U.S. Dollars Cdn. Dollars

Principal $ 315,000 $ 428,400 $ 315,000 $ 492,975
Accrued Interest 221,958 301,863 206,208 322,716
Deferred Unrealised
Exchange Gain 106,690 0
------------ ------------ ------------ ------------
$ 536,958 $ 836,953 $ 489,708 $ 815,691
============ ============ ============ ============

During 2000, a certain note holder commenced an action against the Company,
including a motion for the appointment of a private receiver-manager. The
Company brought a cross-motion to dismiss the action for lack of legal capacity


10


to commence the proceedings. In March 2001, the plaintiff delivered a notice of
discontinuance, thereby abandoning their legal action. Under the Rules of Civil
Procedure the note holder is obligated to pay the Company's costs.

8. CAPITAL STOCK

(a) The Company is authorized by its Articles of Incorporation to issue an
unlimited number, except where noted, of the following classes of shares:

(i) Class "B" preference shares

Effective July 1998, the shareholders have authorized an unlimited number of
class "B" preference shares. These shares are non-voting, redeemable at the
option of the Company and have a preferential dividend of $0.10 per share in
priority to all other shares of the Company. No class "B" shares have been
issued.

(ii) Class "C" common share

Effective July 1998, the shareholders have authorized an unlimited number of
class "C" common shares. Each class "C" common share has 100 votes and a
dividend right of $0.01 which is payable only in the event that the annual
dividends required in respect of the senior shares of the Company, including
class "A" preference shares, class "B" preference shares and common shares, have
been paid; and

(iii) Common shares.

(b) Capital stock.



COMMON SHARES
-----------------------------------------------------
2003 2002
------------------------- -------------------------
Number of Number of
Shares Amount Shares Amount
----------- ----------- ----------- -----------


Balance - Beginning of Year 25,516,780 $10,495,217 25,516,780 $10,495,217
Shares issued post
stock dividend 0 0 0 0
----------- ----------- ----------- -----------

Balance - End of Year 25,516,780 $10,495,217 25,516,780 $10,495,217
----------- ----------- ----------- -----------


Class "C" Common Shares
-----------------------------------------------------
2003 2002
------------------------- -------------------------
Number of Number of
Shares Amount Shares Amount
----------- ----------- ----------- -----------
Balance - Beginning of Year 400,000 $ 100,001 400,000 $ 100,001
Add - Shares Issued During Year 0 0 0 0
----------- ----------- ----------- -----------

Balance - End of Year 400,000 $ 100,001 400,000 $ 100,001
=========== =========== =========== ===========




(c) The Company has issued various stock options for common stock of the
Company's capital stock. The stock options provide for the granting of options
to key employees, including officers, directors and independent contractors of


11


the Company. No option may be granted with a term exceeding ten years. In
addition, the Company has granted warrants from time to time to managers of the
Company. The options and warrants are allocated as follows:

NUMBER OF SHARES

2003 2002
--------- ---------

Balance - Beginning of Year 0 1,016,000
Add - Options and Issued 0 0
--------- ---------
0 1,016,000
Less - Options and Expired 0 1,016,000
--------- ---------
Balance - End of Year 0 0
--------- ---------

The options and granted and outstanding as at May 31, 2003 are as follows:

Common shares
under options
or subject
to warrants Exercise price Expiry date
----------- -------------- -----------

- NIL -

(d) Subsequent Event - consolidation of shares.

The Annual, General and Special Meeting of Shareholders of Corporation, was held
at the Corporation's offices located at 5-7100 Warden Avenue, Markham, Ontario,
Canada L3R 8B5, on May 7, 2003. The following amendments to the shares of the
corporation were approved effective June 16, 2003:

- Amended the Articles of the Corporation by consolidating the issued and
outstanding Common Shares on the basis of one (1) new Common Share for
each 100 old Common Shares so that the 25,516,780 issued and
outstanding Common Shares will be consolidated into 255,168 Common
Shares ("New Common").

- Amended the Articles of the Corporation by attaching certain conversion
rights to the Class C Common Shares, whereby the holder of such Class C
Common Shares be converted into Common Shares as the same shall be
constituted at the time of conversion upon the basis of one hundred
(100) "New Common" Shares for each Class C Common Share in respect of
which the Conversion Right is exercised

- Authorized the conversion of Class C Common Shares into Common Shares
on the basis of 100 new Common Shares for each former Class C Common
Share at the option of the holder.

- In the event that all outstanding 400,000 Class C Common Shares are
converted into new Common Shares, there will be 40,255,168 issued and
outstanding Common Shares.

9. DIVIDENDS

- - NIL -


12


10. COMMITMENTS AND CONTINGENT LIABILITIES

(a) Lease obligations

Minimum future annual lease obligations, net of occupancy costs, for office,
showroom and factory premises are approximately $108,000 annually until January
31, 2005.

11.RECONCILIATION BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES

The financial statements of the Company are prepared in accordance with Canadian
generally accepted accounting principles (Canadian GAAP). These principles
differ in some respects from United States generally accepted accounting
principles (U.S. GAAP).

The effect of such differences on the Company's balance sheet and statement of
loss is as follows:
(a) Balance sheet:

May 31, 2003 November 30, 2002
-------------------------- --------------------------
Canadian U.S. Canadian U.S.
GAAP GAAP GAAP GAAP
- -------------------------------------------------------------------------------
$ $ $ $

Capital stock issued 10,595,218 12,636,761 10,595,218 12,636,761
- -------------------------------------------------------------------------------

Accumulated Deficit (24,321,003) (26,368,761) (24,127,639) (26,175,397)
- -------------------------------------------------------------------------------



(b) Statement of Loss:

May 31, 2003 May 31, 2002
------------ ------------

Net loss under Canadian
& U.S. GAAP 193,364 $ 262,309
Net loss per common
share under
U.S. & Canadian GAAP .007 $ 0.010
Weighted average number
of shares U.S. & Cdn GAAP 25,516,780 25,516,780


12. INCOME TAXES

There is no current or deferred income taxes payable in Canada or the United
States.

The Company has combined tax losses for Canadian and U.S. income tax purposes of
approximately $5,068,860 available for deduction against future years' earnings,
the benefit of which has not been recognized in these financial statements.

These losses, as expressed in Canadian dollars expire as follows:

Year Canadian U.S. Total
- -------------------------------------------------------------------
2003 0 1,530,000 1,530,000
2004 924,031 0 924,031
2005 395,462 0 395,462
2006 88,687 0 88,687
2007 531,742 0 531,742
2008 481,938 0 481,938
2009 488,555 0 488,555
- -------------------------------------------------------------------
$ 2,910,415 $ 1,530,000 $ 4,440,415



13


13. GOING CONCERN

The accompanying financial statements have been prepared on the basis of
accounting principles applicable to a going concern. There is substantial doubt
that the Company has the ability to realize the carrying value of assets
reported in the financial statements, which is dependent upon the attainment of
profitable operations and the continued support of its creditors. The financial
statements do not reflect adjustments that might be necessary should profits not
be attained, or should the support not be continued.

14. RECLASSIFICATION

Certain figures with respect to the six-month period ended May 31, 2002 have
been reclassified to conform with the presentation adopted for the six-month
period ended May 31, 2003.
































14


Item 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF
OPERATIONS (All figures in Canadian dollars, unless stated otherwise)

General

The following should be read in conjunction with our Form 10K for the year ended
November 30, 2002, including: the audited financial statements and the notes
thereto, Item 6. "Selected Financial Data" and other financial information
contained elsewhere and incorporated by reference in this Quarterly Report. In
the following discussions "we" "us" and "our" refer to A.R.T. International Inc.
unless the context otherwise dictates.

In addition to historical information, the discussions in this section may
contain certain forward-looking statements that involve risks and uncertainties.
The forward-looking statements relate to, among other things, operating results,
trends in sales, gross profit, operating expenses, anticipated expenses and
liquidity and capital resources. Our actual results could differ materially from
those anticipated by forwarded-looking statements due to factors including, but
not limited to, those set out forth in our Form 10K for the year ended November
30, 2002, under Item 1. Business - "Factors that may affect the business" and
incorporated by reference in this Quarterly Report.

Except as required by law, we undertake no obligation to update any
forward-looking statement, whether as a result of new information, future events
or otherwise. Readers, however, should carefully review the factors set forth in
other reports or documents that we file from time to time with the Securities
and Exchange Commission.

In this Report, "Company", "A.R.T.", "we", "us" and "our" refer to A.R.T.
International Inc., unless the context otherwise dictates.



Sales

Artagraph Division

The Company continues to be very reliant on one customer for the majority of its
sales revenues. In the six months ended May 31, 2003, the Company recorded sales
to its main retail customer, Museum Company, of $12,833, which represented 30%
of its total sales revenues in that period. First quarter 2003 revenues from the
same customer were $5,723 (27%). Sales in the first six months of fiscal 2002
were $87,179 (66%) to the same customer. The sales reductions are entirely due
to fall in sales-volume as the average selling price has remained constant; and
in addition, the Canadian dollar has strengthened against the US dollar, by
approximately 15% in the last 6 months, which has further eroded the
corporation's revenues.

Since emerging from Chapter 11 in 2002, the Museum Company has not purchased the
same quantity of Artagraph reproductions, in part because the number of stores
emerging from Chapter 11 was down over 50% in numbers, and the remaining stores
are limited to purchasing only customers' orders, which the corporation
drop-ships.


15


Owing to the Company's inability to finance new initiatives, or to actively
participate in trade shows, or to hire dedicated sales personnel to sell to its
markets, the Company continues to achieve limited success in developing new
opportunities, with new or existing customers and markets.

The Company believes that the Artagraph process is very price-competitive with
other known canvas-textured products that are available in the market today.
This is in major part due to the Company's new contract pricing and ordering
policies. The customers can now initiate an Artagraph reproduction order for
approximately 20% [or approximately $5,000] of the previous initial financial
commitment. Further investment in additional manufacture of Artagraph
reproductions for customers under this new program is directly tied to actual
advance sales.

The Company believes that no other known reproduction processes compare in
quality with the Company's processes in accurately reproducing brush strokes and
texture, and the colour intensity and other reproduction characteristics are
believed to be at least equal to any other known reproduction process.

The Company's success in the marketplace will depend upon raising additional
capital, creating greater awareness of its products through aggressive
advertising, participation at trade shows, as well as updating its library of
images and providing new point-of-sale materials.

Gross Profit

Artagraph Division

The Company reported a gross loss of $55,630 in the half of fiscal 2003, which
is a fall from the gross loss of $34,133 from the comparable fiscal period in
2002. The Company's gross margin remained depressed owing to the low capacity
that its plant operates at and the consequent high level of fixed costs in
relation to its total revenues.

Net Loss

Artagraph Division

The net loss in the first half of fiscal 2003 was $193,364 as compared to
$262,309 loss for the first half of fiscal 2002. Lower selling, general and
administration expenses in the current fiscal period helped to offset the
increase in gross losses.


Liquidity and Capital Resources

Artagraph division

Unless the Company is able to significantly increase sales from the level
experienced year to date in 2003, or continue to raise additional capital, it
may not be able to perform all of its obligations in a timely manner. Although
the Company is seeking additional sales from its major customers, as well as
from other sources, no assurance can be given that the Company will be
successful. The Company does not have guaranteed sources for loans. Also, there
is no assurance that the Company will be able to obtain additional working
capital from sale of its equity.


16


If the Company is unable to increased sales, or obtain additional working
capital from loans or from sale of its equity, it could have a material adverse
effect on the ability of the Company to continue operations. Additionally,
acquisition of loans or issuance by the Company of additional equity securities
could cause substantial dilution to the interests and voting rights of current
security holders.






































17


PART II

Nothing to report unless specifically included herein by reference.

Item (3) Default under Senior Securities:

(i) As reported in the Company's Annual Report on form 10-K for the year
ended November 30, 2002, and incorporated herein by reference.


SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

A.R.T. INTERNATIONAL INC.

Dated: June 30, 2003

/s/ Michel van Herreweghe
- -------------------------------------
By: Michel van Herreweghe
Chairman




/s/ Simon Meredith
- -------------------------------------
By: Simon Meredith
President






























18