ITALY Law and Practice Contributed by: Guido Alberto Inzaghi, Ivana Magistrelli, Silvia Gnocco and Gabriele Paladini, SI – Studio Inzaghi
6.15 Specific Regulations Landlords are not allowed to terminate lease agreements in the event of a tenant’s insolven - cy. A specific procedure set up by the court- appointed receiver will take place instead. 6.16 Effect of the Tenant’s Insolvency A cash deposit of up to three months’ rent is usually provided by tenants to landlords in order to secure the latter against a failure by the tenant to meet its obligations. Bank guarantees/insur - ance policies can cover higher amounts. Corpo - rate guarantees are even delivered by the tenant. 6.17 Right to Occupy After Termination or Expiry of a Lease Upon the expiry date, the tenant will vacate the property. Failure to do so may result in holdo - ver indemnities being paid to the landlord for a specified period. Upon the expiry of this grace period (if agreed), the landlord may seek a court injunction and the restoration of damages. 6.18 Right to Assign a Leasehold Interest In line with current market practice, a tenant may be allowed to assign the lease, subject to the landlord’s consent. Exceptions might apply to intra-group assignments. A sublease term must not be longer than the lease term. These provisions can be freely determined by the parties and are subject to negotiations. Italian tenancy law provides that, if a tenant transfers the business along with the lease, the landlord can only oppose the transfer on justified grounds. Longer-term leases can deviate from this provision.
to the lease agreement but not before the tax authority. Landlords and tenants are jointly and severally liable before the tax authority for the registration tax on the lease agreement. Where payment is not made, the tax authority may request both parties pay the full amount, irrespective of the clauses of the lease agreement regarding the splitting of the registration tax. Payment by the landlord or tenant settles the tax liability of the other party. According to market practice, in commercial leases, as a rule, the parties each agree to pay 50% of the registration tax and to do so annually. 6.12 Insurance Issues Real estate must be used in line with zoning and planning provisions. Lease agreements express - ly state what the property is to be used for and the tenant is not allowed to change the intended use. If they do, the lease will be terminated. 6.13 Restrictions on the Use of Real Estate The tenant is usually allowed to alter/improve the property, subject to the landlord’s consent. Upon the expiry of the lease agreement, the landlord may require the tenant to remove all alterations and improvements or may decide to acquire all alterations and improvements for free. 6.14 Tenant’s Ability to Alter and Improve Real Estate Law No 392/1978 regulates commercial leas - es (eg, office, retail and hotel), while Law No 431/1998 regulates residential leases. The Ital - ian Civil Code applies to all leases.
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