ITALY Law and Practice Contributed by: Francesco Dialti, Vincenzo Cimmino, Valentina Bombino and Lucrezia Ghezzi, CBA Studio legale e tributario
6.4 A Foreign Lender’s Ability to Enforce Its Rights As discussed at 3.5 Agent and Trust Concepts , there are doubts as to the effectiveness or validity of a secu- rity interest expressed to be created under Italian law in favour of an entity acting as trustee or collateral agent for the secured creditors and holding the secu- rity interest in that capacity. Any document that is not in Italian must be accompa- nied by an official sworn translation for it to be admis- sible by an Italian court or authority. The judicial liquidation proceeding ( liquidazione giudi- ziale ) triggers a standstill on enforcement actions for the entire duration of the proceedings, with some exceptions, such as: • enforcement actions on mortgaged assets under the mortgage credit rules ( credito fondiario ) as set out in the Consolidated Banking Law; • in very limited cases and under certain circum- stances, creditors secured by a lien ( pegno ) or a privilege ( privilegio ); and 7. Bankruptcy and Insolvency 7.1 Impact of Insolvency Processes • enforcement of financial collateral arrangements pursuant to Legislative Decree No 170 of 21 May 2004 (implementation of Directive 2002/47/EC on financial guarantee contracts). The restructuring proceedings (other than the certified recovery plan mentioned at 7.4 Rescue or Reorgani- sation Procedures Other Than Insolvency ) enable the debtor to file for an in-court standstill preventing enforcement actions, which must be approved by the court on a case-by-case basis. Some restructuring proceedings prevent lenders from accelerating their loans simply on account of the opening of the proceedings (eg, composition with creditors). 7.2 Waterfall of Payments In an insolvency procedure, claims are paid in the fol- lowing order.
In principle, a waiver of sovereign immunity is allowed under Italian law. However, the possibility for govern- mental or other public agencies to waive their sov- ereign immunity shall be verified on a case-by-case basis. The transfer of certain assets (eg, public concessions) may require prior administrative authorisation in the context of the enforcement of a security. Article 36 of EU Regulation No 1215/2012 provides that a judgment issued by the court of a member state shall be recognised in the other member states “with- out any special procedure being required”. Judgments Given by Non-EU Countries The acknowledgment and enforcement of decisions issued by courts belonging to jurisdictions outside of the EU is generally governed by Law No 218/1995. The enforcement of a foreign decision in the Italian ter- ritory requires the filing of a petition before the Court of Appeal of the place where the enforcement is to take place. Such proceedings usually last six months to one year, and the order authorising the enforcement of the foreign decision in Italy fully entitles the creditor to seek enforcement over the debtor’s assets. Arbitral Award Italy is party to the 1958 New York Convention, which sets the conditions under which arbitral awards can be recognised and enforced within the contracting states. 6.3 Foreign Court Judgments Judgments Given by EU Countries An Italian court will declare the effectiveness of arbitral awards inaudita altera parte provided that: (i) the litiga- tion falls within the scope of the arbitration agreement pursuant to Italian law; and (ii) the contents of the arbi- tral award comply with Italian public policy. The counterparty is entitled to challenge such deci- sion before the competent Court of Appeal within 30 days from its notification.
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