The Italian Senate is now debating proposed legislation for the establishment of regulatory agencies for the Italian energy, communications, and transportation industries. The bill in question is Legislative Proposal no. 359-B, which takes the form of a Legislative Decree that would: (1) establish a regulatory agency for the Italian electric and gas industries, and (2) require the Government to present Parliament with proposed laws establishing agencies to regulate communications (including telecommunications and television by broadcasting, satellite, and cable) and transportation.

Title I of Legislative Proposal 359-B sets forth the structure, functions and powers of all three regulatory agencies; Title II establishes the agency to regulate electric energy and gas. In general, each agency will be independent, will have rate-setting power, and will have supervisory powers with which it may enforce with fines. Although there are differences between the Senate and House ("Camera dei Deputati") versions of Proposal 359-B, agreement exists regarding the following functions and powers:

The agencies will have the functions of: making proposals to the Government and Parliament regarding any changes in existing concessions for the utility companies providing the service in question; set criteria for determining rates; supervise utility performance and service, with power to enforce quality standards; issue directives to utilities regarding production and service quantity and quality, in consultation with consumer groups; study utilities performance and publish statistics and reports on service quality to stimulate competition; hear consumer complaints and take action to rectify injustice; and require utilities to adopt service standards.

The agencies will have the power to: demand that utilities produce information and documents; inspect utilities plants; issue administrative fines; and issue orders resembling injunctions. Both Senate and House versions require the agencies to publish regulations for the establishment of a hearings procedure within the agencies themselves. In addition, the House version also requires the agencies to hold regular hearings (apparently informal) with consumer and environmental groups, and to publish their decisions and directives in a special bulletin.

Title II of Proposal 359-B establishes the "Electric Energy and Gas Authority," which would receive supervisory powers now held by the Ministry of Industry, Commerce, and Handicrafts. The Electric and Gas Authority is instructed to set rates for each type of user in a uniform manner nationally. The Senate and House versions differ on the contents of the rates and the manner of their adoption.

The enactment of legislation to regulate public utilities is a prerequisite to the privatization of the Italian electric and telecommunications companies, "ENEL" and "Telecom Italia" respectively, and thus opponents of such privatizations have attempted to prevent the enactment of the utilities regulation legislation at every step. Because such delay has greatly slowed the privatization process, the Italian Government of Mr. Lamberto Dini is focusing significant attention on the Parliament approval of Proposal 359-B.

The content of this article is intended to provide general information on the subject matter. It does not substitute the advice of legal counsel.