Italy: Placement of Units of UCITS with Institutional Investors in Italy

Last Updated: 7 March 1995
Investment funds and other undertakings for collective investment in transferable securities (UCITS) wishing to place their units in foreign jurisdictions often make offerings only to institutional investors, in an attempt to avoid compliance with the costly and burdensome disclosure procedures normally involved in public offerings. While most jurisdictions treat such placings as exempt transactions, the scope of the exemptions and the conditions subject to which they are available to issuers may vary from one country to another. Moreover, other restrictions may affect offerings of securities in other jurisdictions.

In Italy, the regulation governing the offering of units of UCITS not falling within EC Directives 85/611 and 88/220 (which will be considered here) is, in different sectors, inspired by conflicting views of whether placings with institutional investors should be treated as exempt transactions. A coordination of the applicable rules into a consistent scheme is not, therefore, an easy task.

Regulatory Framework
Except for available exemptions, the following restrictions and requirements apply to offerings of units of UCITS in Italy:
(i) authorisation by the Ministry of Treasury; and subsequently
(ii) notification to the Bank of Italy; and
(iii) filing of a prospectus with CONSOB.

For ease of comprehension, items (i) and (ii) will be discussed after item (iii).

If the securities are offered to the 'public', a prospectus must be filed with CONSOB. Under a CONSOB regulation offerings addressed to defined categories of institutional investors (the 'Institutional Investors') are not treated as offerings to the 'public'.

CONSOB requires (i) to be previously notified in writing of such offerings and (ii) after completion of the placement, to be notified of the institutions which have acquired the offered securities.

Ministry Of Treasury
An authorisation of the Ministry of Treasury is required if the offering is addressed to the 'public'.

Unlike the requirement considered above (prospectus), no statutory exemption exists for offerings to institutional investors . Thus, determining whether such offerings are to be treated as offerings to the 'public' for purposes of the authorisation is a matter of interpretation. In the absence of an official position of the Ministry of Treasury, two good arguments lead to deny that said offerings require an authorisation of the Ministry of Treasury:

(i) Most conditions for the issuance of the authorisation (see footnote) indicate clearly that the authorization has the same rationale as the prospectus, ie it is designed to protect unsophisticated investors. Hence, the concept of 'public' should be interpreted here consistently with the definition provided by the CONSOB regulation.

(ii) The statute requiring the authorisation provides that 'authorised' UCITS must comply with the disclosure requirement disc ussed above (prospectus) and other connected duties. As such requirements do not apply where offerings are exclusively addressed to Institutional Investors, it is sensible to conclude that no authorisation is required either in respect of such offerings.

Past experience indicates, however, that the Bank of Italy has a different view pursuant to which no offering would be allowed (irrespective of who the offerees are) unless an authorisation is obtained. The concern is that institutional investors may re-sell the securities to unsophisticated investors without the latter being protected by the issuer having previously fulfilled the conditions for the authorisation.

Bank Of Italy
The 1993 Banking Law carried a new systematic regime of the controls over offerings of (domestic and non-domestic) securities aimed at ensuring the stability and efficiency of the financial markets.
Under the above regime:

(a) all offerings of securities (except certain exempt securities) for amounts equal to or exceeding 10 billion Lire (100 billion Lire for some standardised debt instruments) over any 12-month period must be notified to the Bank of Italy, whether or not they constitute public offerings;

(b) the Bank of Italy may (i) defer or forbid the offerings if their size and/or concentration (considering other notified offerings) seem incompatible with the market dimensions (save different agreements with the offerors - eg split of the offerings in to more tranches) and/or (ii) forbid the offerings for specific reasons relating to the characteristics of the securities.

A 1994 regulation of the Bank of Italy provides that non-domestic UCITS making the above notification must include details on the implementation of the procedure with the Ministry of Treasury. Thus, offerings of units of such UCITS to institutional investors for amounts equal to or in excess of 10 billion Lire will most likely be forbidden by the Bank of Italy unless an authorisation by the Ministry of Treasury is first obtained.

The authorisation may only be granted if the concerned UCITS:

(i) have structural and operational features and are subject to controls in their home country similar to those of Italian UCITS ;

(ii) have set up a branch office in Italy; and

(iii) have entrusted an Italian bank (or an Italian branch of an EC bank) to act as their agent in the subscription and redemption of their units and with the safe-keeping of a share of their portfolio proportional to the units placed with Italian investors.

Also, the officers of the UCITS must meet certain requirements of honourableness and there must be co-operation arrangements between the Italian supervisory authorities and those of the UCITS' home country.

Enzo Schiavello of Gianni, Origoni & Partners, Milan

For further information please contact Mr. Schiavello on +392 76 00 97 56 or enter text search "Gianni, Origoni and Partners" and "Business Monitor".

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions