Government gives galleries until October to match price paid by US museum for postcard-sized painting

The government has delayed the export of a painting that has soared in value since it was identified as a lost Rembrandt, to give a UK collection time to acquire it.

The challenge for any museum or gallery is to match the £16.5m paid by the Getty museum in California for the postcard-sized self-portrait.

Its value has rocketed since it first turned up in a provincial auction house six years ago after at least a century in a private British collection, tentatively identified as a possible Rembrandt copy and estimated at £1,500.

Word evidently got out in the trade that the picture was something special, as a bidding war broke out during a sale in 2007 at the Moore Allen & Innocent auction house in Gloucestershire. It went to a UK buyer – believed to be a London dealer – for £2.2m.

Even that looked like the bargain of the century as soon afterwards it was identified by Ernst van de Vetering, head of the Amsterdam-based Rembrandt Research Project and an acknowledged expert on the work of the 17th-century Dutch master, as a genuine early self-portrait.

The work shows Rembrandt in his early 20s, hair tousled, head thrown back, roaring with laughter. It was probably painted in about 1628,one of a handful he created on copper.

The painting's history remained unknown for more than a century after Rembrandt's death in 1669. It was wrongly identified as early as 1800 when an engraving was made that described it as the work of his contemporary Frans Hals.

The Getty announced this spring that it had bought the picture, one of its first major acquisitions since appointing a new director, Tim Potts, who left the Fitzwilliam Museum in Cambridge last year.

Potts said he had been in pursuit of the painting since he arrived at the Getty, describing Rembrandt's series of self-portraits as "his most sustained and remarkable achievement".

The export bar means that a British collection has until October to match the Getty's price, though the bar could be extended by another six months if a realistic chance of achieving it emerges.

Ed Vaizey, the culture minister, said UK galleries had an impressive collection of works by Rembrandt but nothing from such an early period. "I hope that my deferral of the export licence will allow time for a buyer to come forward and secure this exquisite painting for the nation, where it can be studied and enjoyed by all."