The Supreme Court of Cassation recently examined the relationship between real estate leasing agreements and mandatory mediation in banking and finance agreements. Basing its decision on Article 5 of Legislative Decree 28/2010, which provides that mandatory mediation must be attempted in banking and finance agreements, the court found that in legal proceedings regarding real estate leasing agreements, it is not mandatory to attempt mediation.
In a recent decision the Supreme Court of Cassation – while addressing a question relating to the ritual or non-ritual nature of an arbitration clause – seized the opportunity to reaffirm that the decision of a judge on the validity and effectiveness of an arbitration clause for non-ritual arbitration is not appealable before the Supreme Court of Cassation on the grounds of lack of jurisdiction.
A recent Supreme Court of Cassation decision concerned a tribunal president's rejection of a motion to recuse an arbitrator appointed by the counterparty to a dispute and appoint a third arbitrator. The court found that under Article 815(3) of the Code of Civil Procedure, the decision of an arbitral tribunal president regarding a request for the recusal of an arbitrator cannot be appealed.
The Court of Cassation recently addressed both whether disputes concerning the withdrawal of a shareholder from a company may be submitted to arbitration and the validity of an arbitration clause regarding a specific dispute between a shareholder and a company where the clause does not assign the right to appoint the arbitrator to a third party. The court affirmed that, as a shareholder's right of withdrawal concerns economic disposable rights, disputes in this regard may be submitted to arbitration.
The United Sections of the Court of Cassation recently addressed the matter of jurisdictional preventive regulations and seized the opportunity to reaffirm the jurisdictional nature of arbitration proceedings. The court affirmed the principle according to which an international arbitration clause can invalidate the jurisdiction of the ordinary Italian courts regarding a notice of objection against a preliminary injunction.
The Italian Competition Authority (AGCM) recently ordered Irish carrier Ryanair and Hungarian carrier Wizz Air to suspend the implementation of a new hand baggage policy that would have charged passengers extra for bringing a standard-sized trolley on board flights. Both airlines successfully challenged the AGCM's decision before the Lazio Regional Administrative Court, which suspended the AGCM decisions by way of precautionary measures.
Alitalia is a leading Italian airline that has faced financial difficulties and related restructuring projects. Following the government's extension of the deadline for completion of the sale of Alitalia, three prospective investors have presented more structured offers. This run of offers represents a step forward in the sale of Alitalia's business, even if negotiations must still be carried out over the next few months.
The Rome Division of the Tax Commission recently ordered the full refund of debit notes issued by the Lazio region to a foreign carrier for payment of the tax on aircraft noise pursuant to Regional Law 2/2013. The Tax Commission stated that the carrier had not breached EU Directive 2002/30/EC. Accordingly, it cancelled the debit notes issued by the Lazio region to the foreign carrier and ordered a complete refund of the tax paid by the carrier under the tax on aircraft noise.
The most recent Italian case law has upheld the European Court of Justice's interpretation of EU Regulation 261/2004 in Wallentin-Hermann and Van der Lans by qualifying a hidden manufacturing defect as an 'extraordinary circumstance' under the meaning of Article 5(3) of the regulation and rejecting passenger claims for compensation under Article 7 of the regulation.
In a recent decree the Ministry for the Economic Development started the extraordinary administration procedure for Alitalia pursuant to Law 39/2004 and appointed commissioners to lead the company throughout the procedure. The main purpose of the extraordinary administration is to implement a recovery plan meant to preserve employment levels through the financial restructuring of the company, the sale of the business as a whole or the sale of the business, assets and contracts part by part.
Virtual currencies represent uncharted territory in Italy for various reasons, and the current rules and restrictions will likely need structural adjustments to make them work. The fact that the issuer of virtual currencies for investment purposes is in most cases based in a foreign country (often outside the European Union) could make the scope of current exemptions under the Securities Act too broad.
The Bank of Italy recently commenced a public consultation on the proposed amendments to Regulation 285/2013 on remuneration policies in the banking sector, the main aim of which is to align the regulation with the European Banking Authority Guidelines of December 2015 and ensure compliance with Articles 74(3) and 75(2) of the EU Capital Requirements Directive. The consultation will end on May 14 2018.
With the Competition Law's recent entry into force, the legislature has finally established a clear legal framework by defining the concept of a 'financial lease' and the consequences for banks (or leasing companies) and clients following a breach of contract. These provisions make financial leases a more transparent tool with the aim of boosting their appeal and increasing investment by Italian companies, thus fostering economic growth.
The Italian courts, as well as scholars and legal practitioners, have debated the concept of supervening usury for many years. Until recently, it was unclear whether interest stipulated below the usury threshold at the time of contract, but exceeding such threshold at the time of payment, was usurious. The Supreme Court finally addressed this issue in a recent decision, which ruled out supervening usury entirely.
The Bank of Italy recently opened a public consultation on certain regulatory provisions to be enacted in order to bring forward the implementation of the EU Markets in Financial Instruments Directive and the EU Markets in Financial Instruments Regulation. The proposed provisions aim to supplement the Italian legal framework regarding the organisational duties of regulated intermediaries that provide investment services and activities, including banks.
Italy's value added tax (VAT) group scheme recently took effect. The scope of application, conditions and implications of the VAT group scheme are different from the existing VAT consolidation scheme. Contrary to the VAT consolidation scheme, where each entity remains not only independent from a juridical point of view, but also a single taxable person, a VAT group is considered a single VAT taxpayer and the participating entities are jointly and severally liable for VAT (and interest and penalties) to the tax authorities.
Italy recently implemented the recommendations set out in the Organisation for Economic Cooperation and Development's Additional Guidance on the Attribution of Profits to Permanent Establishments regarding the definition of a 'permanent establishment'. Article 162 of the Income Tax Code now includes a negative list of activities that do not constitute a permanent establishment, the anti-fragmentation rule and details of the requirements that give rise to a permanent establishment.
The Tax Administration can now introduce unilateral corresponding downward adjustments to eliminate double taxation where a foreign tax authority makes a primary adjustment as a result of applying the arm's-length principle to transactions involving associated enterprises in a different tax jurisdiction. This new administrative procedure aims to accelerate the resolution of double taxation deriving from transfer pricing adjustments under mutual agreement procedures.
The new principles introduced by Actions 8 to 10 of the Base Erosion and Profit Shifting project have been reflected in Italy through Decree-Law 50/2017's amendments to Article 110(7) of the Income Tax Code. The new article includes a specific reference to the arm's-length principle and provides for implementing provisions to be issued by the Ministry of Finance to align with international best practices.
The Budget Law 2018 introduced, among other things, amendments to the tax regime concerning dividends from non-resident companies located in low-tax jurisdictions (ie, blacklisted companies). 'Blacklisted companies' are entities resident or located in jurisdictions other than EU or European Economic Area member states, whose ordinary or special tax regime grants a nominal tax rate that is 50% lower than the Italian one.