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Beyond Borders: Eversheds Sutherland's ICR insights series. EU Mobility Directive – Legal Update – Italy

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Country specific - Italy

This country specific outline contains further information regarding the implementation of the provisions of the EU Mobility Directive into Italian law and provides further local insight.

For further information and to access any of our other country-specific briefings that we have prepared, please refer to the bottom section of our general briefings page here.

Cross-border mergers, divisions and conversions

Status of the implementation

As of 04 August 2022, the Italian Parliament approved the “European Delegation Law 2021(Legge di delegazione europea 2021) (the “Italian Delegation Law”), setting out the principles to be implemented and detailed in the subsequent national legislation. This legislation is for the implementation in Italy of the Directive (EU) 2019/2121 of the European Parliament and of the Council (of 27 November 2019) amending Directive (EU) 2017/1132, with regard to cross-border conversions, mergers and divisions (the “Directive”). Given current legislative progress, it is not possible to assess when Italy will implement the Directive into its national legislation (the deadline for this is 31 January 2023) and therefore, the effective date of the new legislation remains unclear. There is also no current clarity regarding any transitional provisions to regulate transactions that have commenced prior to, but implemented after, the law takes effect. If they are not timely implemented, certain provisions of the Directive – i.e. only those that are unconditional, sufficiently clear and precise – shall have direct legal effect.

Summary of Italian current and future legal landscape

Cross-border mergers are currently governed in Italy by Legislative Decree No. 108/2008, whereas for divisions, scholars consider the above-mentioned legislative decree to be applicable by analogy. Italy currently lacks a clear unified framework in relation to cross-border conversions. To date, domestic conversions are regulated under Italian law. In the absence of a cross-border legal framework however, cross-border conversions are implemented, both inbound and outbound, by applying EU case law regarding freedom of establishment and movement (notably, Luxembourg Court of Justice in Cartesio, Vale and Polbud). The Directive (and the Italian Delegation Law) currently provide guidance on the formalities for implementation of such cross-border conversions.

With the implementation of the Directive, Italy will have a unified legal framework for mergers, divisions and cross-border conversions within the EU, safeguarding rights of creditors, employees and (minority) shareholders. We expect these important structuring tools will further facilitate cross-border transactions.

Permitted companies and the geographic scope

The Italian Delegation Law provides for a subjective extension of the scope of the Directive. In particular, the Italian Delegation Law provides for the extension of the principles of the Directive also to: (i) domestic companies other than limited liability companies (“società di capitali”), provided that they are registered in the Companies’ Register, with exception of prevalently mutual cooperative companies (“società cooperative a mutualità prevalente”); and (ii) companies other than limited liability companies governed by the law of another EU Member State. For instance, foreign companies will be able to carry out conversions, mergers and divisions in Italy even though they are not limited liability companies.

The extension also relates to other non-corporate entities (such as associations, foundations etc.) having the exercise of a business activity as their exclusive or principal object, as long as the same are governed by the law of EU Member States and have their registered office, central administration or principal place of business within the territory of the European Union.

Furthermore, the Italian Delegation Law provides for the extension, if applicable, of the Directive’s provisions on conversions, mergers and divisions involving, or resulting in: (i) one or more companies not having their registered office, central administration or principal place of business within the territory of the European Union, and (ii) companies governed by the law of a non-EU Member State. This provision clearly shows the Italian legislator's intention to extend the Directive's provisions to a wider international level in order to simplify and provide for homogeneous rules that are not limited to European companies and States.

Finally, the Italian Delegation Law extends the rules of the Directive (limited to divisions by formation of new companies) to divisions of pre-existing companies.


With the implementation of the Directive, the Italian side of a simplified, non-complex cross-border transaction (i.e. a transaction involving companies which each have only one shareholder, no employees and no secured assets) is likely to take approximately a minimum of four months to complete, given the prescribed 3 month creditor opposition period. More complex cross-border transactions could take between 6-12 months for actual implementation, particularly, as formalities in the EU Member State of exit and entry will both need to be complied with.

The Directive provides for an extensive legal framework and (largely) harmonised legal process for these cross-border transactions and introduces specific safeguards for creditors, employees and (minority) shareholders. For any further guidance and advice on these matters, please do reach out your local Eversheds Sutherland contact.

Competent authority, pre-transaction certificates and anti-abuse checks

The Italian Delegation Law does not identify a competent authority that supervises and executes the Italian realisation of cross-border conversions and divisions. Legislative Decree no. 108 of 30 May 2008 (which implemented Directive 2005/56/EC on cross-border mergers of limited liability companies) provides for the competence of the notary public: (i) in case of an outbound cross-border merger, to issue the pre-transaction cross-border merger certificate (certificato preliminare); (ii) in case of an inbound cross-border merger, to perform the legitimacy check (controllo di legittimità) of the cross-border merger and to draw up the public deed of merger once the legitimacy check has been performed.

In the silence of the Italian Delegation Law, it is likely that the notary public will remain competent for the above control activities for cross-border mergers and that this competence will also be extended to conversions and divisions.

With regard to anti-abuse checks, the Italian Delegation Law only provides that which the upcoming national legislation must: (i) identify specific criteria for qualifying a cross-border deal as abusive or fraudulent; and (ii) provide for the application of criminal and administrative sanctions for violations of the law provisions.

Effective date, method and manner of inbound cross-border transactions

The Italian Delegation Law does not provide specific prescriptions in relation to form, timing or manner for inbound cross-border conversions, mergers and divisions. We assume that the same will be defined in the upcoming national legislation.


The Directive introduces safeguards for creditors. Creditors may raise objections against the cross-border conversions, mergers and divisions before the competent judicial authority, which in Italy will be the court specialising in company law. Moreover, the Delegation Law states that creditors must have protections which must not be lower than those already established by Legislative Decree No. 108 of 30 May 2008 on cross-border mergers. It is likely that the above rules will also apply, mutatis mutandis, to conversions and divisions.

The provisions included in the Directive are also intended to safeguard the position of the employees granting them the right to information, consultation and involvement in the project concerning the cross-border transaction. The main purpose for this is that employees' representatives may be able to exercise an influence in the decision making by the companies which are required to make an in depth-assessment on the possible impact of the transaction on the employment relationships.

The information and consultation procedure takes place according to the general principles laid down by EU regulation on employees’ information and consultation (Directive 2002/14/EC), on European Work Councils (Directive 2009/38/EC) and on transfer of a going concern (Directive 2001/23/EC). According to the Directive, there is an obligation to also draw up a report addressed to employees regarding the implications of the cross-border conversion for employment relationship and any measures for safeguarding those relationships.

It is worth noting that that according to Italian Law, in case of merger and division of companies with more than 15 employees, the legal entities involved have to inform and consult with the Unions (at least 25 days before the transfer) regarding the transaction and its effects. In particular, the procedure will start with an information notice sent to the Unions which should contain: (i) the estimated date of the transaction; (ii) the reasons grounding the transaction; (iii) its consequences on the employment relationship; (iv) any possible measures that will be taken towards employees.

Upon written request of the Unions, the parties will start the consultation phase, at the end of which the parties might enter into an agreement ruling items such as: (i) maintenance of the place of work; (ii) National Collective Bargaining Agreement ruling the employment relationships if this is different between the companies; (iii) salary and treatment granted under the current employment contracts, etc. For the sake of completeness, please note that it is not required by the law to reach an agreement on these items.

Key local contacts

Should you have any questions or if you require any assistance in relation to this matter please do not hesitate to contact us.

Other country specific

For reference, please find other country-specific information we prepared as part of this Insight Series here.