ITALY Law and Practice Contributed by: Guido Alberto Inzaghi, Ivana Magistrelli, Silvia Gnocco and Gabriele Paladini, SI – Studio Inzaghi
The fund’s units may be pledged in accordance with Article 2784 of the Italian Civil Code. For registered notes, an entry in the issuer’s reg - ister of unit holders, held by the management company, is necessary. A pledge over dematerialised units is also allowed. Pursuant to Article 2358 of the Italian Civile Code, a joint stock company may not, directly or indirectly, obtain loans or provide securities for the purchase or subscription of its shares, except under certain conditions. Limited liability companies are subject to strict - er rules, as detailed in 3.5 Legal Requirements Before an Entity Can Give Valid Security . 3.4 Taxes or Fees Relating to the Granting and Enforcement of Security Pursuant to Presidential Decree No 601 of 29 September 1973 (Decree 601/1973), some loans and related securities granted can be exempt from the ordinary taxation regime. The borrower can pay a substitute tax, which is an all-inclusive tax at a rate of 0.25% of the principal amount of the loan. In the cases mentioned in 3.10 Taxes on Loans , the parties can expressly exercise the option of applying the substitute tax regime to securities. If the parties do not exercise this option, the security package will be subject to the ordinary taxation regime, including: • notary fees (in case of notarial securities); • stamp duty; • cadastral tax;
• registration tax; • mortgage tax; and • governmental duties.
The deed of pledge over quota granted by a third person other than the debtor, bears registration tax at the rate of 0.5%, which is calculated on the taxable base represented by the amount secured by the pledge. 3.5 Legal Requirements Before an Entity Can Give Valid Security The granting of security on own assets in favour of third parties – within a group of companies – is always subject to the existence of a corporate benefit, and to certain restrictions in financial assistance situations. Corporate benefit should exist, and be verified, on a case-by-case basis. In the case of joint stock companies, financial assistance is generally prohibited, but it is pos - sible to provide security over own assets subject to compliance with certain steps, formalities and restrictions (see 3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders ). Limited liability companies are subject to stricter rules. In particular, Article 2474 of the Italian Civil Code regulates transactions on their quotas, preventing companies from making transactions to purchase their quotas or provide securities for their purchase or subscription. 3.6 Formalities When a Borrower Is in Default In case of borrower default, the acceleration of the loan and enforceability of the securities are regulated by the provisions of the Italian Civil Code, the Legislative Decree No 170 of 21 May 2004 (as the case may be), as supplemented
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