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Italy: The new procedure for the negotiated settlement of a business crisis (s.c. "procedura per la composizione negoziata della crisi") and the role of foreign creditors

Contract law, Insurance law, Transport law, Cross-border debt

Italy: The new procedure for the negotiated settlement of a business crisis (s.c. "procedura per la composizione negoziata della crisi") and the role of foreign creditors

The procedure for the amicable resolution of business crises, which was introduced by a recent Italian Law, Decreto Legge No. 118/2021 in conjunction with the Executive Decree of 28th, of September 2021, is a newly introduced out-of-court negotiation tool aimed at rehabilitating Italian commercial or agricultural enterprises that are in financial distress. The choice of this procedure is a voluntary path that companies based in Italy can follow, with the express provision that the company be assisted by an Expert. The law requires that the Expert is trained ad hoc to be able to use the corresponding official title and be registered in the list kept at each Italian Chamber of Commerce. The Expert's primary task is to conduct the negotiations necessary for the restructuring of the Italian based company in an impartial, independent and confidential manner, avoiding actions detrimental to creditors and generally ensuring the highest level of fairness and transparency in the conduct of all actors involved.

The negotiation process, as well as all other measures recently envisaged by the Italian government to counteract the negative effects of the economic crisis, also - but not only - because of the pandemic, requires an active, good faith behavior on the part of the creditors, who are at least obliged to participate in the negotiations. In the age of globalization and international trade and corporate relations, it will therefore happen that English, French, German or any other foreign creditors will also be confronted with such proceedings without knowing whether and to what extent they are obliged to participate and with what consequences.

Avvocato and Rechtsanwalt Marilena Bacci, co-lecturer of the course offered by IFOA to train the expert in negotiating solutions to corporate crises, is available for further information on this topic, especially with regard to companies that have commercial and legal relations with Italy in the areas of supply, transport, shipping and logistics contracts.