Several different options are available in order to start a business in Italy and in this article we would like to share the main steps everybody needs to adhere to in order to do so.

First of all, Italian law is extremely open to new and foreign investors, and prescribes that:

  • For investors coming from EU countries within the European Economic Area, they shall be treated as Italian nationals, for the purposes of investing in a new/existing company, without limitations on their capacity to conduct business.
  • For individuals or legal persons outside of the EU/EEA, their capacity is based on the so-called condition of reciprocity. This means that foreign investors may enjoy certain rights only if their Italian counterparts would be entitled to do so in that foreign country. This particular mechanism doesn’t work in the presence of Bilateral Investment Treatiesbetween Italy and the country where the investors come from (The relevant list is available at esteri.it).

Foreign investors are also free to invest in any economic field, however, there are very few exceptions that Italian laws provide to the general principle of freedom of economic initiative, among them include: banking, insurance and investment services; telecommunications; networks; electricity networks; broadcasting. In these such cases, the law provides for a specific regulatory authorization. In certain strategic sectors, identified by the Decree Law No. 21 of 15 March 2012, direct investments are also subject to a comprehensive control regime carried out by the Government.

These particular limitations relate to both Italian and foreign investors: there is no general limitation specifically provided for foreign investors and the law doesn’t dictate a Negative list (as in China) or sectors in which Foreign Investments are totally forbidden.

As far as the form of investment is concerned, Italy guarantees a wide range of legal forms to set up a business. The most common include:

  • SRL (Società a responsabilità limitata) i.e.-A limited liability company;
  • SPA (Società per azioni), i.e. – A company limited by shares;
  • M&A: Transactions in which the ownership of companies, other business organizations, or their operating units are transferred or consolidated with other entities;
  • Purchase of an existing business: In this case, the investor decides to purchase a composite of assets (both material and juridical items) functionally connected to each other and likely to become an instrument for carrying out a business activity;
  • Others (Representative Office, Branch of a foreign company, etc.);

In relation to set-up, the law requires a list of documents in order to complete the incorporation procedure. The main documents needed to incorporate an Italian company are the following:

  • A list of the Italian company’s shareholders and all the information regarding the foreign company wishing to incorporate it;
  • Power of Attorney, notarized and apostilled/legalized, if necessary, issued in favour of the persons who are requested to carry out the incorporation meeting in Italy;
  • Italian Fiscal Code of the Italian company’s directors, supervisors and of the shareholders;
  • By-laws and deed of incorporation of the company which must have the specific requirements provided by the Italian Civil Code and which must be signed in front of a notary public.

In case of M&A, the Italian Civil Code prescribes the necessary list of documents and agreements. Article 2501 expressly mentions:

  • Project of merger, including the main information (deed of incorporation, company name and registered offices)
  • The balance sheet or latest financial statements of the companies participating in the M&A
  • A report drawn up by the administrations of the participating companies relating to the merger project

The abovementioned steps represent the main requirements and procedures necessary to invest in Italy, other prerequisites may also be needed, at D’Andrea and Partner Legal Counsel we have a team of experts who can help you to manage your first investment or to better manage your business in Italy. Please feel free to contact us by email at info@dandreapartners.com for our investment services.