ITALY Law and Practice Contributed by: Guido Alberto Inzaghi, Ivana Magistrelli, Silvia Gnocco and Gabriele Paladini, SI – Studio Inzaghi
representing the corporate capital of a joint stock company ( società per azioni ) but not in the case of quotas in a limited liability company or participation in a real estate alternative investment fund that is an Italian resident company for tax purposes, regardless of whether the purchaser or the seller is an Italian resi - dent person. This financial transaction tax is equal to 0.2% of the sale price. 2.11 Legal Restrictions on Foreign Investors In principle, there are no restrictions on foreign inves - tors acquiring real estate. However, whether investors are established in countries affected by international sanctions or where rights are limited or restricted will be verified. If it is found that they are, the so-called reciprocity principle or the EU Investment Screening Regulations might apply. 3. Real Estate Finance 3.1 Financing Acquisitions of Commercial Real Estate Commercial real estate purchases are generally financed through bank loans, although the number of real estate financings granted by non-banking institu - tions has increased significantly. In the real estate market, investors can participate in commercial real estate through contractual vehicles such as REIFs or corporate vehicles such as joint- stock companies with variable or fixed capital (SICAVs or SICAFs). An additional financing scheme is represented by real estate securitisations. Special purpose vehicles (SPVs) meeting certain requirements can securitise proceeds arising from the ownership of real estate and registered movable assets,, as well as other rights in rem or personal rights over these assets. Some provisions have entered into force in Italy, intro - ducing new alternative lending (ie, entities can oper - ate in the Italian market without requiring a banking licence), such as:
• the EU alternative investment funds (EU AIFs), which carry out investment activities in receivables in Italy; and • the SPV that can grant financing to certain borrow - ers under conditions provided by Law No 130/1999 of 30 April 1999. 3.2 Typical Security Created by Commercial Investors Italian real estate finance transactions are assisted by an extensive security package that includes the fol - lowing: • mortgage; • assignment of rental receivables; • assignment of due diligence report receivables; • assignment of construction contracts receivables; • assignment of hedging agreements receivables; • pledge over the corporate capital of the borrower; • pledge over the shares of the borrower; • pledge over the units of the borrower; • pledge over the borrower’s bank accounts; • assignment of receivables under other contracts or of insurance proceeds; • loss payee clause in connection with any insurance policy (other than covering third-party risks); • equity commitment agreement; and • subordination agreement. 3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders There are different restrictions on granting securities in the context of a real estate financing transaction. • If a company enters into a financing transaction, it needs to receive some corporate benefits. • The transaction must be considered on its merits and the corporate benefit in granting the security must be assessed in the context of that transac - tion. • To ensure that any guarantee or third-party security is valid, the lender needs to identify any concerns regarding corporate benefit and ensure that the situation is properly addressed. • The fund’s units may be pledged in line with Article 2784 of the Italian Civil Code.
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