The Data Protection Authority has issued regulations for banks and companies within banking groups on the lawful processing of clients' personal data. They govern the circulation of information related to banking clients and the tracking of banking operations (relating to money flow or information) performed by bank employees.
A new legislative decree has implemented the EU Consumer Credit Directive in Italy. Among other things, its amendments to the Banking Law regulate the advertising of consumer credit and introduce new rules on transparency provisions, micro-credit operators, financial agents and credit brokers.
A new legislative decree has implemented the EU Acquisitions Directive in respect of acquisitions and increases in holdings in the financial sector. The new rules aim to increase transparency in the approval procedure for acquisitions of stakes in banks and financial intermediaries, introducing new clearance thresholds and setting out the criteria by which the Bank of Italy will assess a potential acquirer.
The legislative decree that implements the EU Payment Services Directive in Italy has recently entered into force. It introduces a new category of payment services provider - the payment institution - and defines the regulatory requirements for Italian institutions and those from other EU member states. In addition, it sets out rules for conducting payment service operations.
In the past few years the European Commission and the Italian Competition Authority have both examined the retail banking sector and multilateral interchange fees. Seen in the context of the Italian regulator's previous interventions in the sector, the ongoing proceedings against MasterCard and several other banks could have significant consequences in the European context.
The government has passed urgent legislation to assist in the recapitalization of Italian banks and to improve their liquidity, giving the Ministry for Economic Affairs and Finance wide-ranging powers. A recent implementing decree specifies criteria, conditions and procedures for state intervention, but it remains to be seen whether the measures will restore public confidence in Italy's unstable financial system.
Given that June 30 2005 is the deadline for amending the bylaws of cooperative banks, on April 2 2005 the Bank of Italy interpreted the applicability of the Corporate Law Reform 2003 to cooperative banks. Among other things, cooperative credit banks can benefit from different models of corporate governance introduced by the Corporate Law Reform.
The Italian Supreme Court has issued an important new decision on the issue of compound interest. The decision upholds a doctrine established since Spring 1999, whereby the Supreme Court has reversed prior case law by ruling that any contractual clauses in banking agreements which provide for the quarterly capitalization of interest due by the client will be deemed null and void.
Following the implementation of the EU Financial Collateral Directive, where an event of default or any similar event agreed upon between the parties occurs, the collateral holder can enforce the financial collateral by sale or appropriation, with respect to financial instruments, or by set-off, with respect to cash, even when the debtor is subject to winding-up or reorganization proceedings.
Recent amendments to the Italian Banking Law aim to harmonize its provisions with the recent corporate law reform. Among other things, the amendments create new opportunities for raising funds from subjects other than the public, and introduce new provisions governing banking activities performed by companies other than banks.
The Italian government has proposed significant reforms to the banking system in a bid to prevent a repeat of financial crises such as those created by the default of Parmalat, Cirio and various bonds subscribed by retail investors. Among other things, the bill gives increased supervisory powers to various banking authorities and facilitates coordination between these bodies.
New provisions introduced by the Interministerial Committee for Credit and Savings and the Bank of Italy aim to enhance consumer protection with regard to the advertising of financial products and services, and throughout the contractual relationship.
Under Italian law, banking customers who issue bounced cheques must be registered in the electronic register of the Interbank Alarm Centre. An exemption applies if the customer honours the cheque within 60 days of the date on which it is presented to the recipient bank. A Florence court has now confirmed that a further exemption applies if the obligation to pay is groundless.
The Italian Banking Association and Italian consumer associations have signed a protocol of agreement setting out the contractual conditions which govern guaranties requested by banks in order to grant credit. Among other things, the protocol confirms the guarantor's right to information about the guaranteed account, and its unilateral right to withdraw from the contract.
The Italian Foreign Exchange Bureau has confirmed that banking groups can appoint a joint representative to fulfil reporting duties concerning all information on suspicious transactions requested under the anti-money laundering provisions. It suggested that this could help to ensure a standard procedure for detecting suspicious transactions across the banking group.
The Italian financial supervisory authority has warned banks to ensure that financial services promoters, who may be employed only to publicize a bank’s name, do not exceed their remit by undertaking solicitation or promotional activities as well. Banks which pay these promoters on commission only must take particular care to prevent this.
By upholding the validity of a recent law decree, the Italian Constitutional Court has finally confirmed the non-applicability of the Usury Law to interest rates agreed before the law took effect.
Two Italian courts have confirmed the validity of contractual clauses which provide for the capitalization of accrued interest that matured prior to the introduction of Legislative Decree 342/1999, despite the precedent established by the Supreme Court and the Constitutional Court.
The Supreme Court has issued conflicting rulings on whether the Usury Law applies to banking contracts that were executed before the law came into force. A government-issued interpretative decree has confirmed that the law does not have retroactive effect, but this has been challenged before the Constitutional Court.
After more than two years of preparation, the government has adopted a decree which will set up a fund for redundant bank employees. The fund will primarily finance courses for the training and re-qualification of employees, and will also authorize the granting of financial incentives to support employees who accept voluntary redundancy.