Italy Factsheet

Country Overview

Italy, with a population of nearly 60 million inhabitants, is divided into 20 regions. Five of these regions (Valle d’Aosta, Trentino-Alto Adige, Friuli-Venezia Giulia, Sicily and Sardinia) have special autonomous status that enables them to enact certain local legislation.
The country is further subdivided into 110 provinces and more than 8,000 municipalities. Rome, located in the Lazio region, is the largest Italian city (more than 2.7 million inhabitants). Milan in Lombardy (1.3 million inhabitants), Naples in Campania (one million inhabitants), Turin in Piedmont (0.9 million inhabitants) and Palermo in Sicily (0.7 million inhabitants) are the other largest Italian cities.
The key business regions are located in the north of the country (Lombardy, Piedmont and
Veneto).

 

Transportation Network

Airports: Italy has approximately 130 airports, handling over 91 million passengers and 750 thousand tons of freight per year.
Railways: 473 million passengers and 87 million tons of freight travel by rail each year. It is one of the safest railway networks in Europe and boasts 16,356 km of track. With the UK it is the third largest behind Germany and France, and represents 10.7 percent of the entire EU network.
High-speed rail already connects the main Italian cities and is being extended further.
Harbours: There are approximately 30 major ports, handling 85 million passengers per year and offering 280 km of docking areas. Port traffic: 550,000 ships. 148 ports distributed along 7,400 km of coastline handle 463 million tons of freight per year.
Roads: The national road network includes 53,000 km of motorways and main roads, representing approximately 16.2 percent of the entire EU network.
The national motorway network extends for some 6,600 km and is fourth in the EU by outreach.

 

Company law and regulatory background

Company law – General overview
Partnerships (società di persone) and companies (società di capitali) represent the two main categories of legal entities which may be incorporated under Italian law. The most important difference between them is that partnerships’ assets and liabilities are only partially segregated from the assets and liabilities of their members, while companies’ assets and liabilities are completely segregated.
A partnership may be set up in three different forms, as a: simple partnership (società semplice), general partnership (società in nome collettivo), or limited partnership (società in accomandita semplice).
Similarly, three different kinds of companies may be incorporated under Italian law: stock companies (società per azioni or SpA), limited liability companies (società a responsabilità limitata or Srl) and partnerships limited by shares (società in accomandita per azioni).

 

Corporate governance of listed companies

Listed companies are subject to supervision by Consob, the public authority responsible for regulating the Italian securities market in order to protect investors and guarantee transparency. The financial statements of listed companies must be audited by an independent auditing company, registered with the Ministry of Justice and meeting the technical standards required by law.

 

Italian competition regulations

Rules on competition are established at different levels, the first of which is the general rule on ‘fair’ business behaviour set out by the Italian Civil Code. Secondly, the Italian Civil Code establishes a limited number of exceptions, such as non-competition agreements concluded upon termination of an employment contract or a transfer of a going concern. A third set of rules, based on articles 81 and 82 of the EC Treaty, establishes the legal framework of control over competition matters and the Italian Competition Authority (Autorità Garante della Concorrenza e del Mercato). This Authority operates according to the EU principles established by the EU Commission and Court of Justice and monitors the following matters:

• business agreements and practices which may have an adverse impact on competition
• business combinations that may give rise to market dominance
• state aid.

It has the power to determine the conditions on which business combinations must be realized, to stop them if they may lead to a dominant position on the market, and to issue fines and sanctions.

 

Taxation of business income: Tax residence

A company or entity is tax resident in Italy if its registered office, place of management or main business is in Italy for the greater part of the fiscal year. Resident companies are taxed on their worldwide income, while non-residents are only taxed on their Italian-source income, as identified by domestic tax law.
Unless otherwise proven, foreign companies owning controlling interests in Italian companies are deemed to be residents of Italy if:

• they are controlled by an Italian resident person (company or individual); or

• they are managed by a board of directors, the majority of whom are Italian resident

individuals.

 

 

 

 

 

 

 

 

 

 

Source: Kpmg Investment in Italy report 2010