Italy: Mergers And Acquisitions - Competition Law In Italy

Last Updated: 15 October 1998

Since 1990, mergers and acquisitions carried out in Italy are potentially subject to advance notification requirements. Certain such transactions are in fact now caught by the provisions of the Italian general competition law of 10th October, 1990 no. 287 (the "Competition Law").

In drafting the Competition Law, the Italian legislator opted to give it a residual sphere of application, and the Competition Law will therefore apply to those matters which are not subject to evaluation on the merits by EU law. Unlike many other European countries, Italy has not, therefore, adopted the "double barrier" principle i.e. a two-fold judgment on the merits of a particular situation by both domestic and European law.

As may be expected for the above reasons, the provisions of the Competition Law essentially reflect the corresponding provisions of the competition legislation of the European Union. Although the differences are more marked at the procedural level and in the actual application of the competition regulations, the EU model has been more or less followed in this respect too.

In addition to stating that its provisions will apply to agreements, abuses of dominant positions and concentrations of undertakings which do not fall within the scope of the equivalent provisions of EU law, the Competition Law also provides that it is to be interpreted on the basis of the European Union legislation governing competition. The aim is therefore that the Italian law should complement the European one, with precedence being given to the application of the latter before turning to the national law.

Any examination of the Italian law cannot therefore be carried out without reference to the corresponding European law.

As far as mergers and acquisitions are concerned, the provisions of the Italian Competition Law relating to transactions resulting in a "concentration" of market power are of particular interest. The Competition Law defines concentrations as including:

- a merger between two or more undertakings;
- the situation where one or more parties, which already control another undertaking, acquire control (as defined), directly or indirectly, of a third undertaking; or
- where two or more undertakings consolidate through the creation of a new entity.

The concept of "control" mentioned above is given a wide meaning in the Competition Law. It will include, inter alia, any means by which a party is able to have an effect on the management of the undertaking in question, even though that party has only a minority interest. A typical control situation which would be caught under the Competition Law is the situation where voting or shareholders' agreements exist pursuant to which the parties concerned decide as to the composition of the board of directors, or where the majority shareholder is under an obligation to consult and receive the approval of a minority shareholder in relation to certain decisions. In this case, even a minority shareholder would be deemed to be in a position of "control", even though acting alone it would be unable to affect the outcome of a vote in the shareholders' meeting.

It can be seen that the definition of concentration therefore includes all concentration transactions, whether horizontal or vertical in nature.

Where such a "concentration" exists, the Competition Law imposes an obligation to make advance notification to the Autorita Garante della Concorrenza e del Mercato (the "Authority") of relevant transactions in order to request clearance for the transaction. A "relevant" transaction is defined as a concentration where:

(i) the total domestic turnover of the undertakings concerned exceeds a specified figure (at present 586 billion Lire); or

(ii) the total domestic turnover of the target company exceeds another specified figure (at present 58.6 billion Lire).

These figures are increased annually in line with inflation. The Competition Law gives a wide interpretation to the term "undertaking". It should be noted that in determining what constitutes an "undertaking" within the meaning of the Competition Law, the actual form of organisation is not important, but rather the fact that some form of commercial activity is carried out. The term commercial activity covers any kind of activity in commercial trade, whether or not that activity is carried out with a view to profit, or of how any profits are distributed. As a consequence, public bodies or bodies with a prevalent state interest are also considered to be "undertakings" for the purposes of the competition rules.

As stated above, notification of "relevant transactions" must be made to the Authority, which is responsible for ensuring compliance with Italian competition law in general. The body is made up of a "President" and four members who are nominated by agreement between the Presidents of the Chamber of Deputies and the Senate: the members hold their positions for seven years and their mandate is not renewable. Appeals against action taken by the Authority fall within the jurisdiction of the administrative courts. Proceedings before the Authority are modelled on those of the EU proceedings.

The obligation laid down by the Competition Law in relation to "relevant transactions" is therefore to give notification of such transactions in advance. The term "in advance" is not defined, and the Competition Law does not expressly prevent the parties from waiting for clearance before they proceed with the transaction. However, in view of the risks involved should clearance subsequently be refused (see below), the tendency so far has been to wait for clearance before proceeding to complete the implementation of a transaction.

On receipt of a notification the Authority has 30 days in which to decide whether or not the transaction in question is a potentially "prohibited" transaction (i.e. in restraint of freedom of competition) in which case it will commence an investigation into the transaction. Where the Authority considers that the transaction does not present grounds for an investigation, then it is required to give notice of this fact, within the above-mentioned 30 day period to the undertaking(s) concerned and to the Minister for Industry. This therefore constitutes "clearance" for the transaction to go ahead. It should be noted that the Authority has power to extend this "pre-investigation" period on the basis that information provided together with the notification is incomplete, inaccurate or false.

Where the Authority decides to commence a formal investigation, this fact will be communicated by way of formal notice. The procedure followed thereafter is broadly based on that followed at EU level; although it is a flexible procedure, it usually commences with a hearing of the parties being held, followed by written submissions and then a further hearing. The Authority has considerable powers of investigation and may also order expert's reports and analyses. Provision is made for sanctions for anyone failing to comply with the obligation to co-operate with the Authority. Any information relating to the undertakings subject to investigation obtained by the Authority is protected by professional secrecy.

The investigation concentrates on attempting to determine whether the concentration transaction, if it were to go ahead, would result in the creation or strengthening of a dominant position in that market so as to eliminate or reduce competition on the domestic market in a substantial manner and with lasting effect. In evaluating this, various factors are taken into account, such as the choice available to suppliers and consumers, the position held in the market by the undertakings concerned, the structure of the market, the competitive situation of the domestic industry, barriers to competitors seeking entry into the market and trends in supply and demand of the products in question.

The formal investigation must be completed within 45 days, (although the Authority has power to extend this period for the same reasons as mentioned earlier in relation to the pre-investigation stage). Once an investigation has been commenced, the Authority may order the undertakings concerned to suspend the implementation of the transaction until the investigation has been completed. This suspension may eventually become a permanent prohibition should the final decision be that the transaction constitutes a "prohibited" transaction.

At the end of the investigation stage the Authority will conclude with a decision on the merits of the matter under investigation. The transaction will therefore be approved, prohibited or approved subject to the prescription of any measures considered necessary to restore actual competition. Where no suspension was ordered and the concentration transaction has already been implemented, then the Authority may prescribe any measures necessary to restore conditions of actual competition and eliminate distortive effect.

In order to ensure compliance with the Competition Law, provision is made for substantial administrative fines in the event of failure to comply with its provisions. Behaviour in breach may consist of, inter alia, failure to provide information, proceeding to implement a concentration in the face of a prohibition, or failure to comply with measures prescribed. In the case of the latter two situations, the fine may be of between 1 and 10% of such part of the turnover of the undertakings concerned as relates to the business areas which are the subject of the concentration. Where no notification has been made, the fine may be of up to 1% of the turnover of the undertakings concerned for the year preceding that in which the infringement is notified. Although in this case the text of the Competition Law refers merely to "turnover", in practice it seems that a restrictive view will be taken and that the relevant turnover will be treated as being solely that relating to the business areas affected by the concentration. The fine imposed in the absence of notification will be in addition to any fines which may subsequently be ordered following investigation of the transaction.

In addition to the general rules regarding concentrations, specific regulations apply in a number of situations.

In the event of a public take-over offer that may result in a relevant concentration transaction, then the notification to the Authority must be made at the same time as notification of the transaction is made to CONSOB, the national commission for companies and the stock exchange. In this case the Authority must reach a decision as to whether to commence an investigation within 15 days instead of the usual 30.

Where suspension of implementation of the concentration is ordered pending completion of an investigation in these circumstances, this will not prevent the implementation of the public take-over offer, provided that the purchaser does not exercise the voting rights attached to the relevant shares. Where the transaction has been completed in this manner, the Authority may, instead of reversing the sale, remove voting rights and order divestiture of assets or such measures as it considers necessary to restore competition.

In relation to transactions concerning banks, the relevant figure for "turnover" is deemed to be equal to one-tenth of the value of the assets referred to in the statement of assets and liabilities, less the value of the so-called "Conti d'Ordine". In relation to the insurance industry, turnover is assessed in terms of the premiums collected in the course of the year in question.

It should be noted that undertakings operating in the publishing and broadcasting sectors do not come within the jurisdiction of the Authority but are subject to supervision by a separate protective body which deals exclusively with those sectors. In this respect, any mergers, acquisitions or agreements which bring about a "dominant control" in these sectors will be null and void. In relation to media publishing industries, the term "dominant control" is defined by the legislation as being:

- effective control over the printing of 20% of the total number of newspapers in Italy in one year (or 50% in a particular region); or
- being or becoming "connected" (meaning owning, directly or indirectly, 5 or 10% of the share capital ) with companies which publish more than 30% of the aggregate number of copies of newspapers issued in Italy in the previous year.

In respect of broadcasting, owners of TV networks may possess no more than three such networks, and are restricted as to their acquisition of newspaper publishers in accordance with the number of TV networks owned. Where 3 TV networks are owned, there is a total prohibition on the ownership of daily newspapers; the owner of 2 networks is permitted to have control of businesses publishing daily newspapers with an annual circulation of up to 8% of the total daily newspaper circulation in Italy; where only 1 TV network is owned the figure is increased to 16%. The allocation of the advertising resources is also regulated in detail in relation to owners of TV networks.

Credit companies and institutions are also subject to supervision by a specific supervisory body. However it should be noted that the above-mentioned separate bodies apply the regulations and follow the procedure laid down in the Competition Law.

In relation to insurance companies the application of the Competition Law by the Authority is subject to having first obtained an opinion from the supervisory authority for private and public insurance (ISVAP).

Finally, where concentrations relate to undertakings which operate in sectors which are subject to supervision by several authorities, then the Competition Law states that each authority may take such action as falls within its competence.

As a final point it should be noted that in exceptional circumstances the Government has the right to authorise a concentration transaction that would otherwise have been prohibited pursuant to the Competition Law on the grounds that there are exceptional reasons in the interests of the national economy. In such cases however, the Competition Authority is required to prescribe the measures necessary to re-establish conditions of full competition within a pre-established period.

In addition the Government may also prohibit, in the interests of the national economy, a transaction which would otherwise have been valid. This option is however only available where a party to the transaction is a national of a country which does not offer reciprocal trade rights to those offered by the Italian legislation.

In conclusion, it must be stated that the Italian Competition Law, although fairly detailed, is still a relatively new area of law in Italy. It should however be recalled that the provisions of the Competition Law are required to be interpreted on the basis of the principles of the EU competition legislation. This means that some of the uncertainty inherent in any new law should be, at least to a certain extent, avoided, insofar as reference can be made to the vast body of case law accumulated through the decisions of the Commission and the judgments of the European Court of Justice.

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.

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