Vessels sailing to the EU from outside the bloc must buy carbon allowances covering half their emissions for the journey. But officials are concerned that ships from far-flung ports are cutting bills without reducing emissions by stopping at ports near EU member countries, and then counting only the shorter final leg into the bloc.

Brussels plans to tighten the rules by including traffic to North African, Middle Eastern and potentially UK ports in its emissions trading system. The rules currently bring in about €7bn-€9bn each year, according to ECSA, the European shipowners’ association […]

[…] “A vessel is paying roughly €300,000 per call so what liners decided to do is not to come directly to the European port but to stop at the nearby non-EU ports to benefit from the 50 per cent ETS rules,” said Alberto Rossi, secretary-general of the Italian shipowners’ association Assarmatori. 

Another issue was vessels bringing non-EU goods to EU ports for transshipment — where they are moved to different ships before being taken on to their final destination outside the bloc.

Rossi said that transshipment services were also moving to north Africa to evade ETS costs, impacting jobs and potentially giving EU countries less control over their supply chains.

Read the full article here

In the article, which builds on the European Commission's latest Annual Report on the implementation of Regulation (EU) 2021/821, Ornella highlights that trade compliance programmes should be designed as dynamic, risk-based systems that are continuously updated and tested, rather than treated as a mere box-ticking exercise.

She also examines the increasing enforcement activity across the European Union, particularly following the implementation of Directive (EU) 2024/1226, and discusses the practical implications for companies operating in international markets.

Click here to read the full article

“A ‘flow-constrained’ approach may improve the presentation of the measure in the dialogue with Brussels; it does not, however, transform a legally fragile measure into one that is automatically authorizable,” Piero Vigano and Francesco Mazzocchi, partners at law firm ADVANT Nctm, told ICIS.

Vigano and Mazzocchi said the resolution makes preserving Italy’s net import position and minimizing impacts on crossborder electricity flows “a central operational constraint” of the reimbursement scheme. The lawyers suggested that “the Commission could look more favourably on a mechanism in which the impact on flows is controlled, transparent and verifiable ex ante, rather than on a mechanism in which the cross-border effect is measured only ex post.”

The regulator’s resolution states that the value and frequency of the reimbursement will be calculated by Italian TSO Terna on the basis of rules defined by ARERA, while taking into account the expected price differential between electricity prices in Italy and neighboring EU countries.

“However, even a ‘flow-constrained’ design would not automatically eliminate compatibility issues, because the selective advantage bestowed on gas-fired generators, the effect on trade between member states, the distortion of competition and the effect on the ETS signal would still need to be assessed”, they added.

Read the full article here

What struck me most today was not a single idea, but the overall tone, which I would describe — in a single word — as honest.

Honest because no one played the part of the uncritical enthusiast, nor that of the nostalgic Luddite. You all brwought something far more valuable to the table: the real complexity of those who work with these tools every day, or who are wondering whether and how to do so.

Let me try to bring it all together.

Read the full article on Global LegalTech Hub

• Marie Hindré, Partner at ADVANT Altana
• Markus P. Linnartz, Partner at ADVANT Beiten
• Filippo Federici, Counsel at ADVANT Nctm

The new “EU Inc” proposals announced last month to create one harmonized set of corporate rules for companies operating across the European Union have the potential to be a genuine gamechanger for business success and EU competitiveness. Reducing complexity and costs will make it far easier for ambitious, innovative companies to start up, raise capital and grow so they can scale just as seamlessly within the bloc as they could if they were based elsewhere in the world in countries with lower administrative burdens such as the US or China. Yet, while this move towards greater simplification represents a major step forward, several key issues could still undermine the overall success of this important initiative.

Read the full article here

This Note forms part of a global suite of country-specific resources helping private practice and inhouse lawyers and attorneys navigate different jurisdictional frameworks for the transfer of IP rights as part of an asset or share purchase transaction.

Overview of Asset and Share Purchase Transactions in Italy

Corporate transactions are commonly structured as either asset or share purchases in Italy. There is no publicly available data on the most common structure, but in practice the share deal is the predominant choice. 

In a share purchase transaction, the purchaser acquires the shares or equity interests of the target company, depending on whether it is a joint-stock company (S.p.A.) or a limited liability company (S.r.l.). The parties formalise a share deal through a notarial deed of transfer, or by endorsing share certificates, which are then notarised and recorded in the shareholders' ledger. 

In an asset purchase transaction, the purchaser buys a business or a business branch, provided that the assets are organised as a business under Article 2555 of the Civil Code (Codice civile) (meaning a collection of assets that the business owner has brought together to carry out business operations). Both parties execute a notarial deed of transfer identifying the business.

Read the full document here

To recap, in the proposal, a company can register within 48 hours, fully online, at a maximum cost of €100 and with no minimum share capital. The Commission says founders will submit their information once through an EU level interface connecting national registers. A central EU register will follow in a second phase.[…]

[…] Fabio Coco, Partner ADVANT Nctm: "The Commission unveiled the EU Inc. proposal on 18 March: it falls short of what the financial sector urgently needs to accelerate innovation and it does not offer any form of ‘fintech passport’ or a genuine ‘single license’ for financial services. 

At this stage, the ‘EU Inc.’ proposal, seems to be a missed opportunity for innovation in the financial sector: the absence of an EU-wide regulatory sandbox or ‘safe harbor’ provision is a notable omission. Such an environment is vital for testing innovative financial services under a reduced regulatory burden without compromising market integrity. By deferring to existing national frameworks, the proposal misses a critical opportunity to lower the high barriers to entry in the banking, insurance, and financial sectors. This lack of centralised ambition risks curbing the competition and innovation the initiative was intended to foster.

In contrast, the progress made by the Italian Supervisory Authorities serves as a robust benchmark. Facilitated by a forward-thinking legislative approach, Italy successfully implemented a national regulatory sandbox. This controlled environment allows supervised entities and Fintech operators to test technologically innovative products and services within the banking, financial and insurance sectors for a defined period – a model that provides the clarity and flexibility currently missing from the broader EU proposal". […]

Read the full article on techround.co.uk

LONDON (ICIS)–Legal experts told ICIS that article 6 of the Italian “DL Bollette” energy decree – which introduces an ETS-linked compensation mechanism for gas-fired power producers – is unlikely to be approved by the European Commission because of its selective and structural, rather than exceptional, nature.

ICIS spoke to Piero Vigano, partner and coordinator of the energy and infrastructure department, and Francesco Mazzocchi, counsel in competition and European Union law at law firm ADVANT Nctm, who said that, as the decree stands, “the likelihood that the European Commission will authorize the measure does not appear to be high.”

Read the full article

The launch of Fer Z depends on EU clearance, which Viganò describes as “the key step in the process of starting the Fer Z mechanism, without which it cannot be implemented”. He recalls that the European Commission has “expressed reservations about the technological efficiency and compatibility of Fer Z with the EU State Aid Guidelines, as well as the effectiveness of the mechanism in relation to the planned maintenance aspects of the facilities”. Given the innovative nature of the model, he also expects that approval of the GSE and ARERA operating rules “could take quite a long time”.

As for its interaction with existing schemes, Viganò sees Fer Z not as conflicting with Fer X but as “competition among operators for the capacity quotas offered by the various schemes, and of simultaneous competition between the schemes themselves”. He adds that while “the Fer X capacity quota could over time decrease and be partially transferred to Fer Z”, “for the moment it is not possible to envisage migration scenarios because reference tariffs are not known”.

Published in icis.com:

New Fer Z incentive mechanism could reduce renewable curtailment in Italy

Complexity of new Italian Fer Z mechanism could delay implementation

In his address, Angelo Anglani explored how Artificial Intelligence can serve as a brilliant associate, pose potential perils, and — when responsibly governed — become a trusted partner for arbitrators.

In his address, he explored how AI can serve as a brilliant associate, a potential peril, and — when responsibly governed — a trusted partner.

"AI will not replace the international arbitrator, but the arbitrator who understands and governs AI will replace the one who does not.”

Drawing inspiration from the great Italian explorers, Angelo Anglani underlined the need to navigate this “digital ocean” with professional judgment, ethical principles, and transparency — ensuring that technology enhances, rather than diminishes, the human essence of justice.

Read the full text published on AIA Online. 

The law includes 28 articles that define how AI can be used in different sectors. It also introduces rules for protecting minors under 14, requiring parental consent before any data linked to them can be processed. Italian lawmakers say the goal is to make AI systems fair and safe for citizens while allowing companies to keep innovating responsibly.

According to Giulio Uras:

“The Italian government’s effort has been both remarkable and, for once, genuinely timely. It sets a clear benchmark for EU countries aiming to complement the AI Act at the national level. Its approach is founded on three key pillars: innovation, transparency, and criminal protection. 

On innovation, the Italian law conveys a clear and forward-looking policy direction. By authorising the secondary use of pseudonymised personal data for research purposes, it adopts a functional and proportionate regulatory model designed to foster scientific and technological development. This approach implicitly acknowledges that Europe’s ability to compete in the global AI landscape depends on avoiding an overly dogmatic interpretation of fundamental rights (particularly in the field of data protection) that could unduly restrict legitimate research and innovation. 

As for transparency, the Italian law is more debatable. The law extends disclosure obligations across several sectors (including employment and intellectual professions) without following the AI Act’s risk-based approach. Such a broad rule may overburden low-risk systems and, paradoxically, stifle innovation.

The criminal protection provisions yield mixed results. The new offense addressing deepfakes(Art. 612-quater of the Italian Criminal Code) effectively targets a growing threat. More broadly, introducing criminal law safeguards was undoubtedly necessary, as it reinforces protection against the unlawful use of AI to obtain unfair profits or inflict harm. However, criminal provisions are effective only when they can be concretely enforced. In this regard, the drafting technique adopted for the new aggravating circumstance (Art. 61, no. 11-decies of the Italian Criminal Code) raises issues of legal clarity and operational effectiveness, which may ultimately limit its enforceability in practice.

The real challenge for EU Member States that wish to follow Italy’s example will be to do so without adding unnecessary layers of bureaucracy or new burdens on businesses. Otherwise, the drive for innovation risks being lost in translation.” 

Full article published in TechRound. 
 

This is not a one-off compliance task, but rather a new standard for business-as-usual. It requires a continuous and dynamic process of reviewing and enhancing internal policies, risk management frameworks, and incident response procedures, as well as revising contractual arrangements with ICT service providers.

The article explores how institutions can bridge the legal, technical, and contractual complexities that arise in this ongoing phase of compliance, focusing on sustainable operational resilience and effective governance models across the financial ecosystem.

By Fabio Coco – published in Mealey’s Litigation Report: Cyber Tech & E-Commerce

Read the full Article 

Her arrival represents a further step in ADVANT Nctm’s growth in the area of corporate criminal law, also following the recent hiring of Luigi Orsi and Alice Baccin, which completes the structure of the current team, integrating synergistically with the firm’s existing expertise in compliance, thanks to the work of lawyers Paolo Gallarati, Raffaele Caldarone and Luca Cavagnaro. At the same time, a department specialising in White Collar Crime, Investigations & Compliance will be established, which will be coordinated by Raffaella.

This move strengthens the firm’s ability to provide clients with a fully integrated and strategic service in connection with the full spectrum of compliance activities and support in managing criminal risks related to their activities. 

With extensive professional experience in corporate criminal law, Raffaella Quintana is top-ranked in leading international directories and deals with white-collar crime issues of all varieties, with a particular focus on cases concerning crimes against the Public Administration, tax crimes, corporate and bankruptcy related criminal offences, as well as environmental and health & safety criminal matters, privileged internal investigations and quasi-criminal corporate liability pursuant to Legislative Decree 231/2001. 

Raffaella Quintana joins the ADVANT Nctm’s Rome office with a team that includes Francesco Lalli and Federico Lucariello (Managing Associates), Ornella Belfiori and Francesca Cannata (Senior Associates) and three Trainees (Matteo Nicolì, Paolo Vespa and Jacopo Nicolaj).

“We are delighted to welcome Raffaella and her team, and we are confident that this collaboration will enable the firm to strengthen and expand its offering, providing clients with increasingly comprehensive and solid legal assistance focused on complex transactions”, commented Paolo Montironi, Senior Partner at ADVANT Nctm. “In an increasingly complex regulatory environment, strengthening our criminal law practice will indeed enable us to better protect our clients, increase our competitiveness and offer high-level multidisciplinary solutions.” 

Artificial intelligence is beginning to make a relevant contribution within the scope of its operations to players in the financial market. We try to take stock of the consequences with Fabio Coco, Partner at ADVANT Nctm.

Artificial intelligence use cases can bring great benefits to businesses in the financial world. Can we give some examples? In particular, artificial intelligence has been used to detect potential fraud against the payment service provider and customers. The ability to analyze large amounts of data makes it possible to identify anomalies in transactions to detect fraud attempts, but also to profile customer habits and identify transactions that deviate from these so-called patterns even through forms of “adaptive learning” i.e., tools that update their parameters, learning from the data in real time.

Full Article on Plus 24 - Il Sole 24 Ore

On February 13, the Bank of Italy published on its website the supervisory provisions for the transposition of Directive (EU) 2021/2167 (so-called Secondary Market Directive - “SMD”, implemented in Italian law by Legislative Decree 116/2024) on buyers and managers of impaired loans, which contain in particular the rules for the authorization and conduct of business by managers of non-performing loans.

The main objective of the aforementioned supervisory provisions is to ensure that the managers (a new figure of supervised entity introduced with the SMD) registered in the new register under Article 114.5 of the TUB operate in a competitive, prudent and transparent manner. The supervisory provisions focus on five key pillars:

Click here

This guide provides a practical overview of patent litigation law across jurisdictions, covering key topics like:

• Patent infringement (direct and indirect)
• Patent invalidity
• Injunctions and opposition proceedings
• Future trends in litigation

Click here to view the guide

Full Article:https://www.we-wealth.com/news/dora-cybersicurezza-banche

EU Regulation 2022/2554, known as “DORA” (Digital Operational Resilience Act), which is scheduled to be implemented as of January 17, 2025, is the most important reform to date in the field of cybersecurity in banking, finance and insurance. As its recitals confirm, the increasing degree of digitization and interconnectedness has amplified cyber risks as a result of the essential role acquired by ICT services. With the increase in cyber threats and operational disruptions resulting from security incidents, the European legislature has recognized the importance of equipping the Union's financial, banking and insurance institutions with a regulatory framework that fosters their “digital operational resilience,” i.e., the ability to build, secure and review their operational integrity and reliability, ensuring through the ICT services of third-party providers, the security of their information systems even in the face of disruption. As such, it is crucial that financial entities and their ICT service providers take appropriate and adequate measures to ensure the security and reliability of their operations.

The main pillars underpinning DORA's discipline are essentially five:

(i) Risk management: obligation to map all functions and activities supported by ICT services and manage their risks, cybersecurity threats, and vulnerabilities by having internal governance structures and formalizing relevant policies to monitor them.

(ii) Operational resilience: requirement to provide a testing program to assess and remediate any cybersecurity gaps.

(iii) Third-party vendor relationships: risk assessment and monitoring of relationships with external vendors (particularly vendors with whom they have direct relationships and also subcontractors) through the drafting of contractual agreements that include the minimum requirements outlined in the regulation.

(iv) Incident management: obligation to inform the relevant authorities of any significant incidents and the measures taken to address them.

(v) Information sharing mechanisms: possibility of mutual exchange of information and analysis of cyber threats.

Impacts of DORA

The impact of DORA on the various types of financial entities will not be the same for all recipients, both in terms of internal governance safeguards (e.g., updating IT security policies) and in terms of reviewing contracts with ICT service providers supporting essential or important functions.

In particular, banks (given their relevance at the level of systemic risk) were already subject to a particularly advanced regulatory framework due to the transposition of both the EBA guidelines on outsourcing and the EBA guidelines on ICT and security risk management (both later recalled and implemented in Circular 285), which already anticipated some of the measures later reaffirmed by DORA.

Along with banks, insurance companies, as well as SGRs and AIF managers, are already currently required to adopt a number of safeguards when outsourcing essential or important functions. For insurance companies, there will be impacts on the activities to be carried out internally to adapt to and comply with the provisions of DORA, also in light of the now outdated industry regulation (i.e. IVASS Regulation No. 38 of 2018). SGRs, AIF managers, and investment firms in turn will have a significant impact (in terms of internal compliance efforts); current sources do not elaborate and do not comprehensively consider digital operational resilience rules (think of EU Regulation 2013/231 and the Bank of Italy and Consob Regulation of December 5, 2019, but also EU Regulation 2017/565; although partially, the only source that tries to regulate the topic are the ESMA cloud guidelines, applicable, moreover, only to cloud services).

In any case, each financial entity will first have to identify all contracts attributable to ICT services provided by third-party vendors; among these, services supporting essential or important functions will have to be distinguished, i.e., those functions whose interruption or interrupted, deficient or insufficient execution would substantially jeopardize the financial results or the soundness or continuity of its services and activities, or even the continued fulfillment of the conditions and obligations inherent in its authorization or other obligations under applicable industry regulations. Subsequently, it will be necessary to conduct a gap analysis in order to be able to properly assess the risks and actions to be taken in order to bring all internal policies and procedures and contracts in line with the new requirements of the DORA Regulations and delegated regulations.

In this sense, the DORA framework is far from being completed and, in particular, (i) most of the implementing technical standards are still missing (so-called RTS and ITS, think for example of accident classification, management of relations with subcontractors, methodologies for accident notification and reporting) and (ii) it will be necessary to issue a legislative decree to “harmonize” the Italian legal system to the new features introduced by the DORA package as provided for in Article 16 of Delegated Law No. 15/2024. Inevitably, all this makes this phase of implementation and progressive adaptation to this new “hyper-technical” legislation even more difficult.

[...] The new legislation aims to remove some regulatory barriers that have so far prevented the development of a pan-European secondary market for bank non-performing loans that is at the same time efficient, competitive and liquid. “From a regulatory perspective,” explains Fabio Coco, partner at ADVANT Nctm, ‘the most noteworthy reform introduced by the decree is the substantial liberalization, under certain conditions, of the purchase of bank non-performing loans.’[...]

[...]“The transposition of the Smd will go far beyond the supervision of non-performing loan servicers,” Coco confirms, indicating that “there will also be impacts on transparency, out-of-court dispute resolution systems, and the rules governing the central risk pool.”[...]

Full article in today's edition of Il Sole 24 Ore.

Articles 49 and 54 TFEU must be interpreted as precluding legislation of a Member State which provides generally for its national law to apply to the acts of management of a company established in another Member State but carrying on the main part of its activities in the first Member State.

Click Here to read the document

Article written by Flavia Trombetti (ADVANT Nctm) and Dr Tobias Pörnbacher (ADVANT Beiten).

Click here to read
 

Effects on M&A Transactions

Companies need to notify acquisitions, mergers and joint ventures to the European Commission when the target company/joint venture achieves an EU-wide turnover of at least EUR 500 million and the parties were granted at least EUR 50 million in combined financial contributions from non-EU countries in the previous three years. Financial contributions in this context not only include state guarantees, equity contributions or loans but also tax benefits, project grants and revenues from sales to state entities.

Notification obligations started on 12 October 2023. Since then, the Foreign Subsidies Regulation has been applied to more deals than initially assumed. In the first 100 days alone, the Commission engaged in pre-notification discussions for 53 transactions, of which 14 were then formally notified. Out of those transactions, many were subject to parallel assessment under the EU Merger Regulation, some to parallel assessment under national merger control procedures in the EU and roughly half also to parallel assessment under foreign direct investment screening in the EU.

The Commission has so far found sufficient indications of distortive foreign subsidies in one case. In June 2024, it opened an in-depth investigation of the planned acquisition by Emirates Telecommunications Group Company PJSC of Eastern European telecommunication operator PPF Telecom Group B.V. Emirates Telecommunications Group Company PJSC is a telecommunication operator based in Abu Dhabi and has allegedly received unlimited guarantees, loans and further financial contributions from the United Arab Emirates. The investigation is still ongoing.

Effects on Public Tenders 

New ex-ante notification obligations also apply to public procurement procedures that exceed certain thresholds. Again, the tool aims at identifying and controlling direct or indirect financial contributions by non-EU countries that are limited to one or more companies or industries, and thus confer the beneficiaries an unfair competitive advantage in the EU market. If the European Commission finds such distortive effects caused by the foreign subsidies, it may issue structural and behavioral remedies.

The Commission has already opened several in-depth investigations into public tenders:

• In February 2024, the Commission opened an in-depth investigation following the notification of a bid by Chinese state-owned company CRRC Qingdao Sifang Locomotive Co. Ltd. for providing and maintaining electric trains in Bulgaria.
• In April 2024, the Commission opened in-depth investigations following two notifications of bidding consortia for the construction and operation of a solar plant in Romania. One consortium included a German subsidiary of LONGi Green Energy Technology Co. Ltd, which is listed on the Hong Kong Stock Exchange. The other consortium included Shanghai Electric UK Co. Ltd. and Shanghai Electric Hong Kong International Engineering Co. Ltd., both ultimately controlled by the P.R. China.

The Commission didn’t need to take a final decision as each bidder withdrew its offer.

Dawn Raids

The European Commission may as well start investigations on its own initiative: It may request notifications for smaller M&A deals and public procurement procedures, and it may also conduct dawn raids. During dawn raids, the Commission may examine all digital and physical company records, take copies thereof, seal business premises, and ask staff members for explanations on facts or documents relating to the subject matter of the inspection.

The Commission made first use of the latter option in April 2024: It carried out an unannounced inspection at the Dutch and Polish offices of the Chinese state-owned company Nuctech. The Commission claims that Nuctech may have received foreign subsidies that could distort the internal market at the expense of other security equipment companies. Nuctech is currently challenging the Commission’s actions before the EU’s General Court.

Early Enforcement Trends

The European Commission is using its new tools under the Foreign Subsidies Regulation very actively and extensively. Some priorities are already becoming apparent: while the Commission’s focus on Chinese companies had been anticipated from the start, the heightened scrutiny for state-owned Arab companies is a more recent trend. Still, the regulatory burden of the Foreign Subsidies Regulation is also felt by businesses based in the EU, the US, the UK or Switzerland when planning and implementing M&A deals.

Energy, transportation, telecommunication and security equipment are so far the sectors in the spotlight of the Commission’s actions. However, we expect the Commission to extend its investigations to further sectors – like other services for critical infrastructure – in the coming years.

Practical Advice for Businesses

Companies operating in these sectors and receiving financial contributions from non-EU countries should be particularly aware of the risk of investigations and prepare for them. For them, it is advisable to make themselves familiar with the European Commission’s dawn raid procedures. Notably, these rules may differ significantly from those applicable to investigations by national authorities in other contexts.

More generally, when preparing large M&A deals or offers for public tenders, the potential notification requirements need to be considered. First experiences show that, for example, the pre-notification discussions with the Commission for company acquisitions can be quite lengthy and can include several requests for information. The implementation of internal reporting systems to continuously gather information on all forms of financial contributions from non-EU governments helps in preparing for such scenarios.

Companies should also watch out for sectoral market investigations – a tool that the Commission has not used so far but will likely use in the mid-term.

Written By Christoph Heinrich and Dr. Cathleen Laitenberger (ADVANT Beiten), Manuela Becchimanzi and Francesco Mazzocchi (ADVANT Nctm)

By European Business Magazine

On the other hand, the introduction of greater protection in favor of the transferred debtors, while necessary, puts the same operators in front of onerous fulfillments “Banks that sell NPLs to third parties will have to provide a lot of information to the potential buyer so that he can carry out a careful due diligence on the portfolio,” Coco recalls in particular, who does not exclude the extension of obligations also to financial intermediaries operating under Article 106 of the Tub.

Also attracting attention is the handling of the transitional regime with the current regulations. “From the examination of the draft text sent to the Chamber,” Coco notes, ”it would seem that the legislature is working to make the transition to the new regime as less traumatic as possible through the provision of special grandfathering clauses that should allow current operators to manage and recover credits acquired before the reform without registering on the register of managers of non-performing loans.

Full article in Il Sole 24 Ore.

The promotion is part of ADVANT Nctm's internal growth strategy aimed at enhancing its talents.

Roberto de Nardis di Prata has more than 20 years of experience in the areas of banking and finance law and debt capital markets, focusing on acquisition, leveraged and real estate finance, corporate lending, basket bond issues and debt restructurings. Roberto assists both primary lenders - banks and debt funds - and sponsors and industrial companies in financing transactions as well as private debt operators.

Francesca Pittau is an expert in employment law and assists Italian and international clients in the management of human resources at every stage, with particular focus on corporate reorganization and restructuring processes. In addition, Francesca is involved in the development and implementation of incentive plans for key managers, welfare policies, and diversity and inclusion activities.Alessia Trevisan works in M&A and, in particular, private equity and venture capital.Alessia assists investment funds, both Italian and foreign, industrial companies, family-office, venture capital funds in investment and divestment transactions, as well as managers in structuring and implementing incentive plans.

Federico Vecchio works in both extrajudicial and judicial assistance to leading national and multinational groups in litigation including arbitration and extraordinary corporate transactions. In addition, Federico has also developed a deep knowledge of sports law thanks to positions held in the justice bodies of CONI and various national and international sports federations.   

Valentina Cavanna wrote an interesting article within Volume 20 of the Impact Assessment Outlook Journal by IEMA, discussing about the supply chain due diligence and their impact assessment and focusing on the duties for EU and non-EU companies.

Read here (from page 14) ➡ https://lnkd.in/dYeEEygS

In 2019 there was a record number of completed M&A transactions in Italy (1,085 compared to 991 in 2018), 'celebrating a decade of uninterrupted growth in volumes'. [1]

a. the material element, consisting of an aggregate of assets, to be interpreted in a broad sense (thus including tangible assets, intangible assets and contractual relationships); and

b. the functional element, consisting of the organisation that transforms the aggregate of single assets into a nexus of items functionally connected to each other and likely to become – as a whole – an instrument for carrying out a business activity.

a. Liability for debts: pursuant to Article 2560 of the civil code, the buyer will be jointly and severally liable for debts incurred by the seller prior to the completion of a transaction to the extent that such debts are recorded in the statutory accounting books of the seller. The debts referred to in Article 2560 of the civil code are only the 'mere debts', which are: tort liabilities, liabilities arising from contracts that pose obligations only on the seller and liabilities arising from bilateral contracts for which the third party has already performed its obligations.

b. Liabilities under Legislative Decree No. 231 of 8 June 2001: pursuant to the Legislative Decree, a company can, under certain circumstances, be held directly liable for any criminal offence committed in its interest or to its own benefit by those entrusted with representative, administrative or managerial duties (e.g., directors and executives), or by any person who is subject to their supervision and authority (e.g., employees, contractors, agents). The liability deriving from crimes committed prior to fundamental corporate changes (e.g., mergers, split-ups, transformations, the acquisition and contribution of assets) is transferred by operation of law to the surviving entity. In particular, Article 33 of the Legislative Decree extends this liability to the acquiring company in the case of the sale of a business unit, but only within the business's value and limitedly to pecuniary fines.

c. Liabilities towards the employees: see Section VII.

d. Social security liabilities: according to Italian Supreme Court decision No. 8179 of 16 June 2001, the social contributions due, but not paid, by the seller at the time of the completion of the proposed transaction are treated as debts pursuant to Article 2560 of the civil code.

e. Tax liabilities: see Section VIII.

a. the buyer incorporates a special purpose vehicle company (newco);

b. the newco enters into a debt financing arrangement to pay the price for the acquisition of the target company and the other transaction costs;

c. the newco acquires the entire (or a controlling interest in the) corporate capital of the target company; and

d. the newco is merged by absorption into the target company (or the opposite, but usually the target company is the surviving company).

a. 571 domestic deals with an overall value of €13.4 billion;

b. 197 Italian investments abroad with an overall value of €21 billion; and

c. 317 foreign investments in Italy with an overall value of €18 billion.

a. one deal was a domestic deal (placed in fifth position);

b. six deals were Italian acquisitions abroad; and

c. three deals (one of which placed in first position) were foreign investments in Italy.

a. the acquisition by KKR Kohlberg Kravis Roberts & Co LP, a US private equity fund, through its subsidiary CK Holdings Co Ltd of Magneti Marelli spa, an Italian company active in the supply of automotive components, totally owned by Fiat Chrysler Automobiles NV, was closed on 2 May 2019 for €5.8 billion;

b. the acquisition of the upstream assets, including the ownership interests in more than 20 producing fields in the North Sea and the Norwegian Sea, of ExxonMibil Corp, one of the largest US groups in the global energy sector, by Vår Energy AS, a Norwegian company owned by the Italian company Eni spa and the private equity fund HitecVision, which closed on 10 December 2019 for US$4.5 billion;

c. the acquisition by Eni spa of 20 per cent of Abu Dhabi Oil Refining Co, a refining company of the Abu Dhabi National Oil Company, the United Arab Emirates' national oil company, which closed on 31 July 2019 for US$3.24 billion;

d. the initial public offering on the Italian stock exchange of Nexi spa, the PayTech leader of the Italian digital payment sector, promoted by Merkury UK Holdco Ltd (a vehicle controlled by Advent International, Bain Capital Private Equity and Clessidra SGR) and several Italian banks, which was followed by the institutional placement of 36.4 per cent of its corporate capital for €2.4 billion; and

e. the two accelerated book-building procedures for ordinary shares of the corporate capital of the Italian bank FinecoBank spa, one of the major private banking operators in Italy, subsidiary of the Italian bank Unicredit spa, which were closed on 8 May and 8 August 2019 for an overall amount of €2.1 billion.

a. financial services recorded 84 deals for an overall value of €10.9 billion;

b. energy and utilities recorded 90 deals for an overall value of €10.8 billion;

c. consumer markets recorded 361 deals for an overall value of €10.1 billion;

d. industrial markets recorded 225 deals for an overall value of €9.2 billion;

e. support services and infrastructures recorded 144 deals for an overall value of €6.6 billion; and

f. telecommunications, media and technology recorded 181 deals for an overall value of €4.7 billion.

a. the restrictions set out in TUPE,[14] which is implemented in Italy by Article 2112 of the civil code;[15] and

b. union information and consultation rights under Article 47 of Law No. 428 of 1990.

a. benefiting from the safety nets or discount on social security contributions regulated by the covid-19 legislation until the full use of the weeks provided by the same legislation; and

b. not benefiting from the new safety nets or discounts on social security contributions until 31 December 2020.

a. the definitive termination of a business consequent to the liquidation of a company without the continuation, even partial, of any activity;

b. the conclusion of a company collective agreement, agreed by the trade unions at national level, that incentivises the termination of an employment relationship on a voluntary basis; and

c. the bankruptcy of a company if a continuation of its activity, even for a limited period, is not envisaged.

a. if derived by tax-resident individuals that do not hold the shares or quotas in the context of a business activity, is subject to a 26 per cent substitute tax. It is possible to step-up the tax value of the shares or quotas;[17] and

b. if derived by tax-resident companies, is subject to 24 per cent corporate income tax (IRES). Under specific conditions, 95 per cent of the capital gain is exempt from IRES (participation exemption regime).[18]

a. of interest expenses over the 30 per cent EBITDA threshold, the excess may be carried forward without a time limitation and can be deducted in the following fiscal years if net interest expenses accrued in that year are less than 30 per cent of EBITDA; and

b. of 30 per cent of EBITDA over the net interest expenses, such excess may be carried forward without amount limitation and may be used to increase the relevant threshold in the following five fiscal years.

a. it does not give rise to any taxable gain or deductible loss in the hands of the contributor;

b. the tax basis of the contributed business is rolled over to the shares or quotas received in exchange by the contributor; and

c. the tax basis of the assets and the liabilities transferred to the receiving company is identical to the one in the hands of the contributor, prior to the contribution. It is possible to step-up the tax basis of the assets (see subsection iii above related to the mergers).

a. taxes and sanctions originating from violations incurred in the two years preceding the completion of the transaction and during the year in which the business is sold; and

b. violations that are reported during the same period of time, even if they occurred in previous years.

a. mergers between two or more previously independent undertakings;

b. acquisitions of sole or joint control over an undertaking or parts thereof, whether through the acquisition of shares or assets, or by contract (e.g., shareholders' agreements) or by any other means; and

c. the establishment of a concentrative joint venture by two or more undertakings.

a. the acquisition by BC Partners LLP, a leading investment firm, of approximately 20 per cent of SOFIMA spa, the controlling shareholder of IMA spa, with the consequent launch of a mandatory tender offer aimed at the delisting of IMA spa (€2.93 billion);

b. the merger between Nexi spa, the Italia leader in the sector of digital payments, and SIA spa, the Italian and European leader in payment technology and infrastructure services, controlled by Cassa Depositi e Prestiti (€15 billion); and

c. the acquisition by Euronext of the entire share capital of Borsa Italiana spa, currently controlled by London Stock Exchange Group Holdings (Italy) Limited (€4.325 billion).

• have, as their regulatory background, both the Foreign Investment Law and the Negative List, i.e. the list currently in force of sectors in which foreign investments are prohibited or subject to restrictions (for instance, limitations on the percentage of equity that a foreign shareholder may hold);
• confirm, albeit indirectly, that the legislation applicable on domestic companies, in particular the Company Law and the Partnership Law, now also apply to FIEs;
• provide for a five-year transition period (from 1 January 2020 to 31 December 2024) during which the existing FIEs need to adopt the corporate changes, regarding their corporate form and organization, in line with the Company Law and the Partnership Law. If these corporate changes are not adopted within this five-year transition period, the State Administration for Market Regulation (formerly, State Administration of Industry and Commerce) will not allow these companies to implement other corporate changes until their corporate form and organization are updated according to the law;
• expressly provide that investment incentives and subsidies granted by local governments be documented in “Letters of Commitment” or contractual agreements, which may however be subject to unilateral changes by the authority in the event of new investment policies dictated by national interest. In these cases, the foreign investor will be entitled to a “fair compensation”;
• set out that conducts by local officials discriminating against foreign investors, or aimed at forcing technology transfers be prohibited (and sanctioned).

At a first reading, the practical implications of the Regulations for FIEs and foreign investors appear, among others, to be the following:

• on the occasion of corporate changes such as, for example, replacement of the legal representative, appointment of new directors, transfer of the registered address, increase / reduction of the corporate capital, etc., the changes regarding the corporate form and organization need also to be adopted in accordance with the Company Law or the Partnership Law. A relevant corporate change is the adoption of the shareholders’ meeting in the Sino-foreign joint ventures;
• for already existing FIEs, the shareholders could renegotiate aspects of governance such as repealing the need of the consent of the Chinese minority shareholder for the transfer of shares or the liquidation of the company. In practice, these renegotiations of the governance of the joint venture will likely involve a restructuring of the corporate shareholding;
• in the newly created joint ventures (i.e. the joint venture established after 1 January, 2020), however, there is no longer the statutory obligation to provide for the need for the consent of the Chinese minority shareholder (i.e. his right of veto) for changes to the articles of association, dissolution and the liquidation of the joint venture, the increase (or reduction) of the company capital. Therefore, this entails greater flexibility in designing the shareholder relationships and company governance in the articles of association and the joint venture contract. In sum, there is a wider space for contractual autonomy;
• in the Letters of Commitment and / or in the investment agreements between local governments and foreign investors it will be useful to provide for the principle of “fair compensation” in favor of the foreign investor in case of revocation or modification of the incentives and subsidies originally granted to the investment project.

 Taken from Vivishanghai.com