ITALY Law and Practice Contributed by: Alessandro Pistochini, Luca Moglia, Giovanni Bellissimo and Giulia Barattini, Pistochini Avvocati Studio Legale
Group Company Liability As to the potential involvement of other legal entities, the extension of liability under Legislative Decree No 231/2001 to parent companies for offences perpe - trated within a subsidiary requires that two cumulative conditions be met, as outlined below. • The offence must be committed by two or more individuals acting in concert, each of whom is linked to a different legal entity (for example, an offence committed jointly by a director of the subsidiary and a director of the parent company), or by a single individual holding a position in both companies (eg, someone serving as a director in both the parent and the subsidiary). • The offence must be committed not only in the interests or to the advantage of the subsidiary, but also in the interests or to the advantage of the parent company, which is formally unrelated to the offence. Such interest or advantage must be concretely established, meaning that the parent company must derive an actual or potential benefit, even if not necessarily of a financial nature. Mergers and Acquisitions For the purposes of corporate liability under Leg - islative Decree No 231/2001, a distinction must be drawn between mergers and acquisitions. In a merger (including by incorporation), Article 29 provides that the surviving entity is liable for offences attributable to the entities party to the merger. By contrast, in an acquisition, the purchaser does not assume liability under the Decree for offences committed within the target prior to completion. 1.6 Sentencing and Penalties Penalty assessment follows Articles 132–133 of the ICC: judges apply discretion within statutory limits, considering the gravity of the offence and the offend - er’s conduct. Recidivism increases penalties (Article 99 ICC). Similar principles apply to corporate liability (Articles 11, 14, 20, Decree 231/2001). Regarding the sentencing process in proceedings other than those conducted under ordinary trial pro - cedures, the Italian legal system places significant emphasis on plea bargaining (Article 444 ICCP).
It allows accused individuals to negotiate penalties with the prosecutor and allows reduced penalties (up to one-third) if imprisonment exceeds two years, excluding ancillary penalties and costs (except confis - cation, Article 240 ICC). The offence extinguishes after five (crimes) or two (misdemeanours) crime-free years. Plea agreements have no evidentiary value in other proceedings (Article 445 CPC). The Cartabia Reform allows for a conditional plea as an exemption from accessory penalties. For prison sentences of four years or less, judges may impose alternatives, including semi-custody, home detention, community service, fines and promoting rehabilitation. White-collar crimes often involve legal entities to which Legislative Decree No 231/2001 is directly applicable. In such cases, sentencing may consider corporate culture, compliance programmes, co-operation and remediation as mitigating factors. Article 17 exempts from disqualifying sanctions if, before trial, the entity: • fully compensates and removes effects; • adopts a compliance model; and • makes illicit profit available for confiscation. According to Article 185 of the ICC, any offence that causes harm gives rise to an obligation on the part of the offender to provide compensation. From a proce - dural standpoint, an injured party may seek redress by participating in the criminal proceedings as a civil party, in accordance with Article 74 of the Code of Criminal Procedure, or by bringing a civil action for damages before the civil courts. Class Actions 1.7 Damages and Compensation Legal Grounds and Competent Courts Class actions are relatively new in the Italian legal system and, moreover, the various forms of collec - tive action introduced in Italy (eg, Articles 840-bis et seq. of the Code of Civil Procedure) are not specifi - cally aimed at securing compensation for victims of white-collar offences, but rather address, more gener - ally, cases of unlawful conduct – not necessarily of a
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