Government Makes Efforts to Promote Arbitration in Company Disputes - International Law Office

One of the Italian legislature's current objectives is to promote alternative dispute resolution in company law matters. To achieve this aim, the Parliament recently issued Law 366 of October 3 2001, which sets out guidelines for the reform of Italian company law as it applies to limited and publicly limited companies and cooperatives. Pursuant to Article 1 of the law, the specific details of how this will be accomplished will be set out in supplementary legislation, which the government will adopt following proposals from the Ministry of Justice, the Treasury and the Ministry of Trade.

Article 12 of Law 366, entitled "New Rules of Procedure", directly addresses the issues of arbitration and alternative dispute resolution. The existing procedural requirements for arbitration are set out in Chapter 8 of the Code of Civil Procedure. Article 806 of this chapter provides that parties may generally refer disputes to arbitration, provided that the subject matter of the dispute is capable of resolution by private agreement (the article includes a list of matters which are not deemed to be capable of such resolution). Among other things, Article 808 of Chapter 8 makes provision for arbitration by way of a contractual clause or in a separate document and, by reference to Article 807, provides that such clauses must be in writing and clear as to their subject matter. Article 12.3 of Law 366 refers specifically to both articles when stating that the government, by way of derogation from these provisions, may introduce legislation allowing for a company's shareholders to include an arbitration clause in the memorandum and articles of association in relation to some or all company law matters, including disputes concerning the transfer of shares and shareholders agreements. This seemingly extends the circumstances in which the parties can have recourse to arbitration. In addition, where the subject matter of a dispute is not capable of resolution by private agreement, the law provides that the arbitration agreement must refer to arbitration decisions that are based on equity being expressly excluded, and the award shall be challengeable for violation of law.

Article 12.4 of Law 366 states that the government is also empowered to provide for conciliation in company disputes before certain private bodies which can guarantee their efficiency and capability, and which are registered with the Ministry of Justice.

Statements of principle to this effect have been made, but little substantive legislation has so far been enacted, and none concerning alternative dispute resolution. The government has until October 2002 to produce the details of the proposed reforms.

For further information on this topic please contact Michael Poole at Studio Legale Sutti by telephone (+39 02 76 20 41) or by fax (+39 02 76 20 48 05) or by email (maildesk@sutti.com). The Studio Legale Sutti website can be accessed at www.sutti.com.