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Important commercial and corporate law updates | Italy

The following content relates to advice on updates in relation to commercial,corporate, data protection,  via our firm network connection, Bird & Bird, for Italy:

16 April 2020

Commercial

  • A decree of the President of the Council of Ministers enacted on 10 April 2020  extended the quarantine and shut-down measures which had already entered into  force during March until 3 May 2020.
  • Decreto Liquidità provides that  promissory notes, bills of exchange and other negotiable instruments issued before the date of entry into force of the decree and expiring between 9  March and  30 April 2020 are suspended.
  • According to the circular issued by Ministry of Economic Development on 25 March 2020, companies that are party to international contracts containing a clause that provides for the obligation to document force majeure as an exemption from contractual liability may  obtain a certificate from the relevant Chamber of Commerce regarding the existence of such force majeure resulting from the health emergency. In particular, the Chambers of Commerce may attest a declaration by the company (which will be held responsible in case of false declarations) that the state of health emergency by COVID-19 in Italy and the consequent measures of containment imposed by the Government Authority have not allowed the company to fulfill its contractual obligations in international business relations undertaken prior to the restrictions, due to unforeseeable reasons beyond the company's control and capacity.

Commercial /corporate

On 8  April 2020 Law Decree n. 23 (Decreto Liquidità) was enacted, aiming to sustain Italian enterprises in the  context of the COVID-19 crisis. In order to ensure the necessary liquidity to  companies having registered office in Italy affected by the COVID-19  epidemic, a state controlled company (SACE S.p.A.) will grant guarantees for  facilities in any form until 31 December 2020 - for a total amount of EUR 200  billion, of which EUR 30 billion is intended to support SMEs (Small and  Medium Enterprises) - in favour of banks, national and international financial  institutions and other entities authorised to exercise credit activities in  Italy. Decreto Liquidità  also strengthens the Guarantee Fund (Fondo di  Garanzia), confirming and extending the provisions  set out in Decreto Cura,  with the aim of further facilitating access to credit for Small and Medium  Enterprises.

Corporate

  • Decreto Liquidità impacts those  provisions of the Italian Civil Code governing the reduction of the corporate  capital of limited companies as a result of losses. As a rule, when the  corporate capital is reduced by losses (by more than one third or below the  legal limit), the board of directors must immediately convene a quota  holders'/shareholders' meeting to cover the losses and restore the minimum  corporate capital, or to resolve upon the dissolution of the company. The  Decree provides that such provisions are suspended until 31 December 2020.  Accordingly, with regard to joint stock companies, limited liability  companies, partnerships limited by shares (Società in accomandita per azioni)  and cooperative companies (Società cooperative), the reduction of the  corporate capital below the legal minimum threshold will not constitute a  cause for dissolution for each of such types of companies for the period  considered.
  • Decreto Liquidità aims at ensuring  the going concern perspective with particular regard to those companies  which, prior to the current crisis, were in a stable situation and had  regular going concern perspectives. The provision allows to evaluate the  items in the 2020 financial statements using normal operating criteria,  provided that the going concern perspective has already been established in  the financial statements for the financial year ended 31 December 2019. In  the absence of a similar corrective, the atypical situation caused by the  COVID-19 epidemic would have required a very large number of companies to  draw up the 2020 financial statements without the possibility of adopting a  going concern perspective, with a significant impact on the valuation of all  items in the financial statements.
  • Decreto Liquidità aims at  encouraging the participation of shareholders/quota holders in increasing the  funding streams to the benefit of the company,  temporarily suspending the normal  mechanisms provided  by Articles 2467  and 2497-quinquies of the Italian Civil Code, which would put them in a  subordinate position with respect to the company's creditors. Such articles  provide the principle in virtue of which the repayment of quota holders' and  shareholders' loans is subordinated to the repayment of other creditors, if  such loans were granted due to the company's excessive over-indebtedness or  in the presence of a company's financial situation in light of which it would  have been reasonable to proceed with a contribution (conferimento).

2 April 2020

Commercial

  • A decree of the President of the Council of Ministers enacted on 9 March 2020 qualified the entire Italian territory as quarantined "red" area. People are prevented from moving unless for proven (i) work needs, (ii) situations of necessity or (iii) health reasons.  No leisure activity is permitted outdoors; sport is allowed only near home, individually and as long as a minimum distance of 1 meter is observed.
  • A decree of the President of the Council of Ministers enacted on 22 March 2020 ordered the total shut down of companies, apart from those carrying out "essential services". Businesses which can continue to operate are listed in an annex which refers to the NACE code (codice ATECO), identifying the kind of activity. An authorization can be requested to the local Prefectural Office to continue to operate.  However, companies which are affected by the shut down may continue to operate by means of smart working (home working). The shut down of companies has been extended until 14 April 2020.
  • With regard to restaurant, cafés and other catering businesses, only home delivery is allowed.

Corporate

Decreto Cura simplifies rules concerning shareholders' meetings. Notwithstanding different provisions in company by-laws, deadline to convene the shareholder meeting which shall approve the financial statement is postponed up to 180 days after the closing of the financial year;  the meeting can be held, even exclusively, by telecommunication means; moreover, in limited liability companies votes can be casted by consultation in writing or by express written consent.

Data Protection

The decree of the President of the Council of Ministers enacted on 22 March 2020  provides that essential services listed therein (see above) must adopt safety protocols that must include, in consultation with trade unions, (i) the detection of body temperature to employees and vendors at each entrance of the premises (recording only those that exceed the threshold of 37,5°C and having them addressed at home and mandate to contact their doctor), and, where strictly necessary, (ii) the presentation of questionnaires on travel to areas at greater risk of infection and confirmation on whether they have been contacts with people found covid-19 positive in the last 14 days. Please note that the proportionality of these security measures must be assessed on a case-by-case basis.

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