The main legal framework governing mergers and acquisitions is the Italian Civil Code. This law contains provisions about the mergers and acquisitions of unlisted and listed joint stock companies and Italian limited liability companies. Compared to other European countries’ legislation, the Italian Civil Code contains more provisions about the corporate law. In 2004, the Civil Code suffered major modifications with respect to mergers and acquisitions of companies and limited partnerships in Italy.
Acquisition transactions in Italy may be categorized as:
- – share or quota deals,
- – asset deals,
- – purchase and sale of assets,
- – contribution of assets.
With respect to merger transactions, these may be categorized as mergers and de-mergers in Italy. The structure of the transaction depends on the deal and other tax considerations.
Table of Contents
Shares and quota deals in Italy
Shares and quota deals in acquisition cases in Italy apply mostly to joint stock corporations and limited liability companies. The corporate capital of joint stock corporations is usually represented by shares certificates, which will be transferred in front of an Italian public notary or bank officer in case of acquisitions.
The capital of an Italian limited liability company is represented by quotas, which will be transferred before a public notary by signing an agreement. The agreement must be then submitted with the Italian Companies Registrar.
Mergers and de-mergers in Italy
Italian mergers are set out in articles 2501 to 2505 in the Civil Code which establishes two types of mergers:
- – mergers by acquisition,
- – mergers by incorporation.
Mergers by acquisitions are the cases of a company merging with an existing enterprise with the transfer of all assets and liabilities. Mergers by incorporations are represented by the merger of two or more companies into a newly formed company in Italy.
Article 2506 in the Civil Code also establishes the procedure for de-mergers in Italy. De-mergers are represented by the transfer of an Italian company’s assets and liabilities to other previously or newly formed companies. De-mergers may happen without the Italian company’s liquidation or winding up.
For details about taxation aspects in cases or mergers and acquisitions, you may contact our attorneys in Italy.