International corporations from all over the world use Italian
corporate entities for their subsidiaries operating in Italy.
Italian Limited Liability Companies are commonly used as SPV in
transactions of different nature ranging from real estate projects
to M&A and restructuring.
In Italy, there are different types of corporate entities that
may be incorporated depending on the size and features of the
business intended to be carried out as well as the wishes of the
participants in relation to their personal liability for the
obligations of the company and the mechanics for the management
The two most popular forms of corporate bodies are:
a) "Societe per Azioni" (S.p.A) - Joint Stock Company
(equivalent to a plc in the
b) "Societe a responsabilita limitata" (S.r.l.) -
Limited Liability Company
Provided that it is a common intention of the majority of the
entrepreneurs to operate using a limited liability corporate
entity, an S.p.A. is usually more appropriate for a medium to big
business venture that typically provides for a large number of
participants and need rigid and comprehensive organisational
structure and regulation. An S.r.l. would be used for small to
The incorporation of a SRL in Italy involves a relatively
straightforward process, it is relatively inexpensive (the minimum
share capital is !10,000, out of which only the 25% has to be paid
up front and it may be returned to the company once incorporated)
and the participants may benefit from a flexible organizational
structure to be shaped depending on their own needs. Also, the
Italian law does not require for the S.r.l. to comply with
administrative activities and procedure to be carried out
periodically (other than the submission of the Balance Sheet and
Profit and Loss report).
The main steps involved in a company formation process in Italy
- Obtaining the Italian fiscal code of the participants
- Payment of the prescribed share capital from a temporary bank
- Drafting the relevant corporate documents (Articles of
Association and By-Laws)
- Completion of the incorporation process before an Italian
- Application for the company's IVA number (equivalent to
- Registration of the deed of incorporation at the competent
Italian Registry of the Entrepreneurs
The timeframe likely to be involved for the incorporation of an
S.r.l. - starting from the registration in the Public Registry of
Entrepreneurs when the company will be 100% operative - is three to
four weeks. The incorporation process of an S.p.A. is likely to
involve a little more than that.
Giambrone Law assists clients in any of the abovementioned
phases that lead commented: "We often offer to have our
lawyers to act as special attorneys on behalf of the participants
for the purpose of carrying out the activities which are necessary
and instrumental to the incorporation and attending before the
Italian Notary Public for completion of the deed of
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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