ITALY Trends and Developments Contributed by: Francesco Di Carlo and Filippo Raynaud, Fivers Studio Legale e Tributario
Introduction The Italian economic system has always been char - acterised by a marginal role of capital markets. In addition to this long-standing phenomenon, the Ital - ian economy has recently seen a significant trend of going-private transactions, relocations of important Italian listed companies to other European jurisdic - tions (mostly, the Netherlands) and foreign Initial Public Offering (IPO)s. Compared to other European markets, the Italian capital market is particularly small, in terms of market capitalisation versus GDP (approxi - mately 40%). Italian listed companies have on average a small portion of free-float (lower than 60%). In the last ten years, the ratio between the value of Initial Public Offering (IPO)s and that of delisting transac - tions has been negative for EUR60 billion. Acknowledging this trend, in March 2024, the Italian Parliament passed an important reform of Italian cor - porate law, which according to the legislature’s intent, aimed to foster the competitiveness of Italian corpo - rate law and facilitate access of Italian companies to the capital markets (so-called “Capital Law”). Numer - ous novelties and changes have been introduced in respect of corporate governance for Italian compa - nies listed on a regulated market or a multilateral trad - ing facility, that have been the subject of an intense debate among economists and legal scholars in the past months. Together with the new legal provisions, the Italian par - liament also delegated the Italian government to draft and pass an organic reform of the legal framework applicable to joint stock corporations. Such delegation has now been partially implemented through Legisla - tive Decree No 47 of 27 March 2026, which introduced further changes to the Italian corporate governance framework applicable to listed companies. Below is a summary of some of the most heavily debated changes to the corporate governance pro - visions introduced by the Capital Law and the sub - sequent implementing reforms. Just a part of such changes is effectively aimed at improving access to capital markets.
Participation in Shareholders’ Meetings Through a Designated Proxy (Article 11 of the Capital Law) The Capital Law introduced a new legal provision (Arti - cle 135-undecies.1 of Legislative Decree No 58/1998, the so-called “Consolidated Financial Act” or CFA), that allows any Italian company listed on a regulated market or on an MTF to include a provision in the by-laws that would allow the management body to call shareholders’ meetings in a “closed-door” format only. In particular, through this format, a shareholders’ meeting should be held with the sole presence of the designed proxy and the management and control bodies, excluding any live interaction among share - holders. Each shareholder is (still) entitled to exercise its right to submit individual proposals, propose addi - tions to the agenda, and ask questions on the items on the agenda ahead of the meeting. However, each shareholder must submit voting instructions on the items on the agenda ahead of the meeting, through the exclusive proxy designed by the company. The Italian government introduced a similar provision for any listed company (regardless of any provisions to the contrary in the relevant by-laws) in the context of the temporary emergency provisions introduced dur - ing the recent COVID-19 pandemic. Many Italian listed companies appreciated this alter - native modality to hold shareholders’ meetings, as it helped reduce their cost and duration. For this reason, the expiry of this emergency provision was repeatedly extended well beyond the COVID-19 emergency (ie, lastly, until 31 December 2024). With the Capital Law, the Italian parliament resolved to allow Italian listed companies to introduce this provision in their by-laws on a permanent basis. However, this provision roused strong opposition from institutional investors (most notably, by the Interna - tional Corporate Governance Network), as it excludes any live interaction among shareholders, and between shareholders and management, and therefore sig - nificantly limits the ability of minority shareholders to express their views.
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