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Foreign investors are subject to special measures (prior approval from the competent ministry and restrictions regarding the amount allowed for capital acquisitions) only in the following sectors:
– Telecommunications and the press;
– Airlines and shipping companies;
– Electricity and gas;
– Oil exploitation.
rather than Foundations that can support initiatives considered of interest. The State encourages investment in some regions with important forms of benefits for foreign investors in terms of tax, investment loans at discounted interest rates, state guarantees for exporters, and other financial aid. The government grants financial assistance to foreign investors depending on the geographic location of the investment, the size of the investment company, and the sector in which the company is investing.
impressive presence in the aerospace industry, Italy stands out in design, technology, and expertise. The country is characterised by a tradition of local products, culinary specialties, and wines renowned all over the world, as well as its very high standards of quality and safety. Italy offers many investment opportunities in new technologies: nanotechnology, biotechnology, high-tech and products. It enjoys a favourable and stimulating environment for developing life science projects (competitive costs, simple standards, excellent research). Italy is also a logistical platform for international trade, with new investments and better transport and telecommunications infrastructure throughout the Mediterranean. Finally, Italy is one of the top tourist destinations in the world, an industry worth around €70 billion per year. Energy and telecommunications are also sectors of great interest with huge development potential. The automobile market is constantly expanding, and is increasingly popular with foreign producers. The Italian chemical industry is one of the most dynamic sectors in the country, with a strong focus on innovation, highly qualified human resources, and large multinationals that have chosen the peninsula to launch their activities. Italy is the third largest European producer in the chemical industry and a leading player on the world stage. In a country where the production and consumption volumes of agricultural food
products and drinks are the highest in Europe, tradition and innovation create new opportunities to conquer new foreign markets.
lakes. Moreover, the tax law in Italy favours foreign investors.>/div>
The maximum amount of funding has been increased to €1.5 million. The funding will be provided interest-free and may make up to 70% of the total investment. The maximum percentage of funding may rise to 80% if the start-up is composed exclusively of women or young people under the age of 35, or if it includes at least one Italian PhD who is working abroad. Furthermore, there is a grant quota (20%) just for start-ups based in southern Italy. Start-ups founded not more than 12 months ago can also benefit from specialised technical management tutoring services.
It is the OECD model that dictates the content, defining a representative office as a fixed place of business on Italian soil of a foreign company that solely performs promotional, advertising, information gathering, and scientific or market research functions. The role of a mere representation office, therefore, is solely to prepare for the foreign enterprise to penetrate the Italian market; it cannot carry out productive or commercial activities.
In this regard, therefore, a mere representation office is not, for tax purposes, a “permanent establishment” of the foreign company and therefore cannot be considered a taxable entity.
To be more specific, it is necessary to explain that there is a distinction between a branch of a foreign company and a secondary establishment: the latter is normally managed and represented by a permanent representative, known as an agent, who conducts business related to the secondary establishment itself and maintains its external relations.
A branch, however, is administered and represented by the foreign company on which it is dependent.
Under Italian legislation, both a secondary establishment and a branch are considered “permanent establishments” and are therefore taxable for tax purposes.
E’ il modello O.C.S.E. a dettarne i contenuti definendo ufficio di rappresentanza la sede fissa in suolo italiano di una società estera che svolga funzioni esclusivamente promozionali e pubblicitarie, di raccolta di informazioni, di ricerca scientifica o di mercato. L’ufficio di mera rappresentanza, quindi, svolge soltanto una funzione preparatoria per la penetrazione dell’impresa straniera sul mercato italiano, non potendo svolgere attività produttive o commerciali.
A questo proposito, dunque, l’ufficio di mera rappresentanza non costituisce, ai fini fiscali, una cd. stabile organizzazione della società estera e pertanto non può essere considerato un soggetto imponibile.
Founding an S.N.C. (general partnership) requires a written deed recorded at the Businesses Office that must contain: general information on the partners, the company name, information on the managing partners who are responsible for representing the company, the corporate purpose, the head offices, the contributions of each member, services all members are obliged to perform, the duration of the company, and the method of distributing profits and losses. Members have unlimited and several liability for the company obligations. Amounts may not be distributed among shareholders unless they are profits actually achieved and, if there is a loss of share capital, it is not possible to distribute profits until the share capital itself has been restored or correspondingly reduced.
An S.A.S. (limited partnership) on the other hand, has two categories of partners: general partners and limited partners. The difference between the two types lies in the major duties and responsibilities required of general partners compared to limited partners. Limited partners, in fact, have limited joint liability in relation to the share of capital contributed, while general partners are liable without limitation. The greater responsibility is compensated for by the fact that only the latter may represent the company and include their names in the business name.
An S.R.L. (limited liability company) is a corporation and meets company obligations with its assets. The minimum capital is €10,000; however, certain limited liability companies with registered capital of one euro are permitted.
An S.P.A. (company limited by shares) is a corporation with asset management autonomy. The company meets its debts with its company assets. The status of shareholder is obtained by purchasing shares. The shareholders, however, do not manage the company nor can they acquire direct knowledge of documentation relating to management. The model is based on the following organisational scheme:
The shareholders’ Meeting – This is the sovereign body of the S.P.A., in which the will of the shareholders is formed, which is then implemented by the administrative body. The Meeting makes decisions collectively through formal meetings and the resolutions legitimately passed by the Meeting are binding for all shareholders.
The administrative body.
This is the body that manages the company without constraint from the Shareholders’ Meeting, with the exception of those acts for which the law expressly reserves the power for the shareholders.
The composition and functions of the administrative body depend on the model of corporate governance that the S.P.A. has adopted. The governing body will consist of either a sole director or a Board of Directors (which may appoint a CEO from among its members).
The supervisory body
This is called the Board of Auditors and is the body that exercises control over the management of the company; if the accounting audit is not delegated to an external party – an auditor or audit firm – the Board of Auditors can also perform this type of activity. Ordinarily, management control is entrusted to a Board of Auditors composed of three or five members.
A limited liability company (S.R.L.) is presented as a corporate model that functions more simply than a company limited by shares: in fact, the law gives the founding members the right to establish the characteristics, operation, and company organisation, adapting them to their own specific needs. The laws governing limited liability companies can, in fact, for the most part be waived.
Recently, in addition to the ordinary model, the Italian Civil Code provided for an additional category of S.R.L., known as a “simplified limited liability company”. In this case, the shareholders are natural persons are under the age of 35.
Share capital and shares
The share capital of a limited liability company cannot be less than 10,000.00, while the capital for S.R.L.s cannot be less than 1 euro.
As with S.P.A.s, in the case of S.R.L.s where there is a plurality of the founding members, those who must release the portion underwritten by a cash contribution can release only 25% of the portion, thus undertaking to pay the remaining 75% at a later stage, i.e. when the administrative body of the company requires it.
By contrast, the sole shareholder is required to release the entire share capital. It is interesting to know that, unlike in the case of S.P.A.s, it is also possible to contribute the value represented by the performance of works or services by one or more shareholders to an S.R.L.
Corporate bodies and Corporate Governance
• Shareholders’ Meeting – In S.R.L.s, shareholders can make the decisions reserved for them by law or by the Deed of Incorporation using the traditional collective method at a formal meeting. However, the Deed of Incorporation may stipulate that such decisions – with the exception of certain matters required by law – be made with “consultation” or “written consent”. Normally, the administration of the company is entrusted to one or more shareholders appointed by a decision of the shareholders themselves. Therefore, S.R.L.s can be managed by a sole director or by a plurality of directors jointly in a Board of Directors. By law, the presence of a supervisory body is not mandatory for S.R.L.s, so appointing such a body is optional. However, the presence of a supervisory body or auditor is required if the company has a share capital of more than €120,000; that is, a company for which a statutory audit is mandatory or that has exceeded two limitations relating to the balance sheet, the number of employees, or the value of revenues for two consecutive financial years, is required to prepare consolidated financial statements.
Companies limited by shares feature the typical elements of S.P.A.s and S.A.S.s. There are, in fact, two categories of shareholders: general partners, who are necessarily administrators, and are jointly and severally liable for the company obligations, and limited partners, who only need to make the contributions to which they are obliged upon subscription of the shares.
Obviously, depending on the nature of the investment idea, it is necessary to keep in mind that some activities require specific prior permits for installations (sewage treatment plants, emission vents, special transportation permits, environmental reclamation, environmental impact assessments, respect of historical and artistic assets, etc.). ASBF is able to provide assistance in obtaining permits and licenses granted by Public Administration.
In Italy it is also mandatory for partnerships and corporations to go before a notary public. The notary is a public official, since the deed drawn up by the notary is a public document and constitutes full evidence even before the Judge. The notary ensures that the content of the deed is consistent with the intention of the parties – an intention that the notary has ascertained and conformed to the laws, thus ensuring the legality of the deeds created in front of the notary.
Corporate law requires the use of notarial deeds for deeds for which the legality, the identity of the parties, and compliance with their wishes must be guaranteed to the fullest extent. Moreover, the fact that the services of a notary are required by law means that rates for services rendered by the notary are established by the law itself.
In this respect, there is a great difference between the role of the notary in civil law in the Anglo-Saxon world and the Italian notary: in fact, the former only ensures the authenticity of the signatures of the persons signing the deed before them. According to the framework of the Italian system, the advantage of the presence of the notary is this: by law, the Italian notary attends to the interests of all parties to the deed at the time, and these parties will have no need to resort – as happens in the Anglo-Saxon countries – to legal counsel to ascertain the legal validity of the deed stipulated. This means high savings in professional fees and a significant reduction in the risk of disputes regarding the validity of that deed.
The Italian Chamber of Commerce has a wide network, which consists in over one hundred offices, 19 regional unions, 13 regional overseas centers and 150 branches and the institution functions without relying on public funds.
The Italian Trade Register has an essential role in the process of company incorporation and also has the task of supporting companies in their development process, by providing transparency in commercial activities of the Italian companies. Moreover, the TRADE Register facilitates the company’s relation with other public authorities and it supervises the company’s activity in order the Italian law.
When choosing to incorporate a company by going to the Register of Enterprises, the founders must be aware that several documents and information are needed: an application form for registering, the articles of association, the company charters, a list of names and addresses of members and shareholders, the VAT number, tax identification number and a proof of registration with Social Security Administration and Accident Insurance Office.
For the online procedure, all the documents previously mentioned must be attached in electronically form, along with an application provided by the online platform. This online procedure is available via the portal belonging to the Chamber of Commerce, which is known as InfoCamere.
The incorporation procedure takes approximately one week, when all the documents and information provided are valid and accurate.
The company’s founders must be aware that all changes regarding the company must be noticed to the Italian TRADE Register, either by visiting an office of the TRADE Register, either via e-mail.