Doing business in Italy

Italian company law is codified in the Civil Code, with notaries handling incorporation and filings and companies coming into existence on entry in the Business Register. Tax is administered nationally (IRES, VAT) with a regional production tax (IRAP). Key authorities include Banca d'Italia for banking supervision, the AGCM for competition, the Garante for data protection, ANAC for whistleblowing and anti-corruption, and ACN for cybersecurity. As an EU member, Italy applies EU customs, data protection and sanctions law.

Key facts

Corporate income tax

IRES 24% plus IRAP 3.9% (standard)

VAT

22% standard

Main entity form

S.r.l., minimum capital EUR 1

Foreign ownership

Open to EU and non-EU investors; golden power review for strategic assets

Data protection

GDPR plus Legislative Decree 196/2003; regulator: Garante

New York Convention

Party since 1969

Minimum wage

No statutory minimum; set by collective agreements

Merger control thresholds (2026)

EUR 595m combined and EUR 36m each for two parties

Foreign investors usually choose a limited liability company (S.r.l.) or a joint stock company (S.p.A.), both formed through a notary and registered in the Business Register. Capital requirements are low for an S.r.l. and higher for an S.p.A., and formation can be completed online.

Key facts

• An S.r.l. can be formed with share capital of EUR 1, which makes it the usual vehicle for a subsidiary; at least 25 percent must be paid in once capital reaches EUR 10,000.

• An S.p.A. needs EUR 50,000 minimum capital and is the required form for a listing.

• A notary drafts and files the deed, and the company exists only once entered in the Business Register, so plan banking and contracting around the registration date.

• Incorporation of an S.r.l. can be done fully online before a notary, which helps foreign shareholders who cannot travel.

• Company forms are open to EU and non-EU nationals, but strategic sectors are subject to golden power screening.

Who handles this in ItalySetting up and running a companyContracts and commercial law

Companies pay IRES at 24 percent and regional IRAP, generally at 3.9 percent. VAT is 22 percent with structured e-invoicing through SdI for domestic transactions. Tax figures here come from a secondary source because the tax authority pages could not be retrieved.

Key facts

• Budget for IRES at 24 percent plus regional IRAP at a standard 3.9 percent.

• Standard VAT is 22 percent, and invoices between persons resident or established in Italy must go through the SdI exchange system.

• Outbound dividends and interest bear 26 percent withholding and royalties 30 percent on 75 percent of the gross, unless a treaty or EU directive exemption applies; EU directive relief needs a 10 percent (dividends) or 25 percent (interest and royalties) holding for one year.

• Transfer pricing documentation must be ready to hand over within 20 days of a request.

• The CFC test has been aligned with Pillar Two from FY 2024; check the separate minimum tax rules for large groups.

Who handles this in ItalyTax and structuring · Alessandro DagninoAccounting and annual filings · Gianluigi Mollica

Italian pay is set mainly by sector collective agreements rather than a statutory minimum wage. Severance (TFR) accrues for every employee, and non-EU hiring runs through annual quotas.

Key facts

• There is no statutory minimum wage; the applicable collective agreement sets minimum pay by level.

• Budget for thirteen (sometimes fourteen) monthly payments and TFR accrual of 1/13.5 of annual pay.

• Overtime is capped at 8 hours a week and 250 hours a year.

• Trial periods are 3 or 6 months by statute, often varied by collective agreements.

• Recruiting non-EU staff from abroad depends on the annual quota decree and authorisation from the Immigration Single Desk.

Who handles this in ItalyEmployment, payroll and immigration

Banking and financial activities need authorisation from Banca d'Italia, and strategic assets are subject to the golden power regime. Several national incentive schemes, mainly managed by Invitalia, support large or regional investments.

Key facts

• Banks and financial intermediaries need Banca d'Italia authorisation; significant banks are supervised within the SSM.

• Golden power special powers apply to companies holding strategic assets, beginning with energy, transport and communications.

• Development Contracts support projects of EUR 20 million or more with grants and soft loans.

• Law 181/89 incentives cover industrial crisis areas, with a fast track for strategic foreign investments of EUR 10 million or more.

Who handles this in ItalyLicences, permits and regulators

Banks are supervised by Banca d'Italia within the European Single Supervisory Mechanism. Banks and other obliged entities report suspicious transactions to the UIF, so expect thorough know-your-customer checks when opening accounts.

Key facts

• Account opening is subject to AML checks under Legislative Decree 231/2007; obliged entities report suspicious transactions to the UIF.

• Bank supervision is shared with the ECB through the SSM.

• Payments must respect EU sanctions, which national authorities implement.

Who handles this in ItalyBanking and capitalPayments and currencyAnti-bribery, sanctions and compliance

Italy applies EU customs law under the Union Customs Code. Importers and exporters need an EORI number, and exports of listed dual-use items need an authorisation.

Key facts

• Customs law is the EU Union Customs Code, so tariffs and procedures follow EU rules.

• Obtain an EORI number from the Italian customs authority before the first customs operation.

• Check products against Annex I to the EU Dual-Use Regulation before export.

Who handles this in ItalyCustoms, trade and export controls

The GDPR applies, supplemented by the Personal Data Protection Code, and the Garante is the supervisory authority. Italy has transposed NIS2, with ACN as the national cybersecurity agency.

Key facts

• GDPR obligations apply in full, with national rules in Legislative Decree 196/2003 as amended in 2018.

• Transfers outside the EU are simplest to adequacy countries, including certified US companies under the Data Privacy Framework.

• Medium and large entities in NIS2 sectors must manage cyber risk and report significant incidents; ACN is the single point of contact.

• E-invoicing through SdI is also a systems obligation for domestic businesses.

Who handles this in ItalyData protection and cyber

Italy is party to the main WIPO treaties, so trademarks, patents and designs can be extended to Italy through the Madrid, PCT and Hague systems. A Patent Box offers an enhanced deduction for qualifying R&D.

Key facts

• International trademark registrations can designate Italy under the Madrid Protocol, in force since 2000.

• PCT applications can enter the Italian national phase; Italy has been a PCT state since 1985.

• Copyright is protected under the Berne Convention without registration formalities.

• The Patent Box gives an extra 110 percent deduction on qualifying R&D for patents, software and designs.

Who handles this in ItalyTrade marks, patents and brands

Mergers above the AGCM turnover thresholds need prior notification, and the AGCM can call in some smaller deals. Acquisitions involving strategic assets may also need golden power clearance, and insolvency is governed by the 2019 Crisis Code.

Key facts

• Notify the AGCM before closing where combined Italian turnover exceeds EUR 595 million and two parties each exceed EUR 36 million (2026 thresholds).

• The AGCM may call in below-threshold deals within six months of completion in defined cases.

• Golden power review runs alongside merger control, with a 45-day decision period.

• EU rules on investment screening are being revised; formal adoption was pending at the time of research.

• Restructuring and insolvency follow the Code of Business Crisis and Insolvency, in force since July 2022.

Who handles this in ItalyBuying, selling and investing · Francesco Mangiameli

Companies can be held liable for certain offences under Legislative Decree 231/2001, and many adopt organisation models to manage that risk. Whistleblowing channels are mandatory for larger and certain sector entities, and AML rules apply to obliged entities.

Key facts

• Corporate liability for offences is set by Legislative Decree 231/2001.

• Entities with 50 or more employees, entities in sensitive sectors and entities with a 231 model must run internal whistleblowing channels.

• ANAC can fine EUR 10,000 to EUR 50,000 for retaliation or failure to set up channels.

• AML obligations sit in Legislative Decree 231/2007, with reporting to the UIF.

Who handles this in ItalyAnti-bribery, sanctions and compliance

Italy is a New York Convention state and recognises EU judgments under Brussels I bis without special procedure. Mediation is a precondition to court action in several commercial areas.

Key facts

• Foreign arbitral awards are enforced under the New York Convention, in force for Italy since 1969.

• EU member state judgments are recognised and enforceable in Italy without a declaration of enforceability.

• Before suing in listed matters, such as leases, insurance or banking contracts, parties must try mediation.

Who handles this in ItalyDisputes and arbitration