Home - Versione italiana - Accessible mode - Site map - Contacts and certified e-mail - Privacy - Links -  RSS

Consob - www.consob.it
Consob
Issuers
Intermediaries
Markets
Legal framework
Financial education
Conciliation and Arbitration Chamber

Within the Articles, the changes brought about by Italian Legislative Decree no. 25 of 15 February 2016 are shown in bold print

* * *

LEGISLATIVE DECREE No. 58 OF 24 FEBRUARY 1998 Consolidated Law on Finance pursuant to Articles 8 and 21 of Law no. 52 of 6 February 1996 1

INDEX

PART I - COMMON PROVISIONS

Article 1 - Definitions
Article 2 - Relations with European Union law and integration in ESFS
Article 3 - Administrative measures
Article 4 - Cooperation between authorities and professional secrecy
Article 4-bis - Identification of the competent authority and sector competent authorities for the purpose of Regulation (EC) No. 1060/2009 as subsequently amended, in relation to credit ratings agencies
Article 4-ter Identification of the national authorities competent pursuant to regulation (EU) n° 236/2012 on short selling and certain aspects of derivative contracts for hedging the credit default swap risk
Article 4-quarter Identification of the competent national authorities pursuant to Regulation (EU) no. 648/2012 of the European Parliament and of the Council, of 4 July 2012
Article 4-quinquies Identification of the national authorities with competence pursuant to regulation (EU) no. 345/2013, relative to the European Venture Capital Fund (EuVECA), and regulation (EU) no. 346/2013, relative to the European Social Entrepreneurship Fund (EuSEF)

PART II - REGULATION OF INTERMEDIARIES

TITLE I - GENERAL PROVISIONS

Chapter I - Supervision
Article 5 - Purpose and scope
Article 6 - Regulatory powers
Article 7 - Supervisory powers
Article 7-bis - Capital reserves
Article 8 - Reporting requirements
Article 8-bis - Internal systems for reporting violations
Article 8-ter - Reporting violations to the Bank of Italy and Consob
Article 9 - Statutory audit
Article 10 - Inspections
Article 11 - Composition of groups
Article 12 - Supervision of groups

Chapter II - Corporate officers and shareholders
Article 13 - Company representatives
Article 14 - Shareholders
Article 15 - Acquisition and sale of shareholdings
Article 16 - Suspension of voting rights, obligation to dispose of shareholdings
Article 17 - Requests for information on shareholdings

TITLE II - INVESTMENT SERVICES

Chapter I - Persons and authorization
Article 18 - Persons  
Article 18-bis - Independent financial advisors
Article 18-ter - Financial consulting companies
Article 19 - Authorization
Article 20 - Register

Chapter II - Performance of services
Article 21 - General criteria
Article 22 - Separation of assets
Article 23 - Contracts
Article 24 - Management of investment portfolios
Article 25 - Trading on regulated markets
Article 25-bis - Financial products issued by banks and insurance companies

Chapter III - Cross-border operations
Article 26 - Branches of Italian investment companies and freedom to provide services
Article 27 - EU Investment companies 
Article 28 - Non-EU investment companies
Article 29 - Banks

Chapter IV - Door-to-door selling
Article 30 - Door-to-door selling
Article 31 - Financial advisors authorised to make off-premises offers
Article 32 - Distance marketing of investment services and activities and financial instruments

Chapter IV-bis - Protection of investors
Article 32-bis - Protection of investors’ collective undertakings
Article 32-ter - Out-of-court settlement of disputes

TITLE III - COLLECTIVE PORTFOLIO MANAGEMENT

Chapter I - Authorised subjects and contemplated businesses
Article 32-quater - Reserve assets
Article 33 - Businesses contemplated

Chapter I-bis- Discipline of authorised subjects

Section I - Asset management companies
Article 34 - Authorisation of asset management companies
Article 35 - Register

Section II - SICAVs and SICAFs
Article 35-bis - Constitution
Article 35-ter - Registers
Article 35-quater - SICAV capital and shares
Article 35-quinquies - SICAF capital and shares
Article 35-sexies - The SICAV shareholders' meeting
Article 35-septies - Amendments to articles of association
Article 35-octies - Winding up and voluntary liquidation
Article 35-novies - Transformation

Section III - Common provisions and exceptions
Article 35-decies - Rules of conduct and voting rights
Article 35-undecies - Exceptions for Italian AIFMs
Article 35-duodecies - Assessment of credit rating

Section I - Mutual investment funds
Article 36 - Mutual investment funds
Article 37 - Fund regulations

Section II - SICAVs and SICAFs under outsourced management
Article 38 - SICAVs and SICAFs which appoint an external manager

Section III -Common provisions
Article 39 - Structure of Italian UCIs

Section IV -Master-feeder structures
Article 40 - Authorisation and operating rules of master-feeder structures

Section V - Merger and spin-off of asset investment bodies
Article 40-bis - UCI merger and spin-off
Article 40-ter - Cross-border UCI merger

Chapter II-bis - Management company cross-border operations
Article 41 - Cross-border operations of asset management companies
Article 41-bis - EU management companies
Article 41-ter - EU AIFMs
Article 41-quater - Non-EU AIFMs

Chapter II-ter - Marketing of UCIs
Article 42 - Marketing in Italy of EU UCI units and shares
Article 43 - Marketing of reserved AIFs
Article 44 - Marketing of non-reserved AIFs

Chapter II-quarter - Obligations of asset management companies of which AIFs acquire relevant stakes and control of non-listed companies and of issuers
Article 45 - Obligations relative to the acquisition of relevant stakes or control of non-listed companies
Article 46 - Obligations relative to the acquisition of a controlling interest of an issuer

Chapter II-quinquies - UCITS credit
Article 46-bis - Direct issue of loans by Italian AIFs
Article 46-ter - Direct issue of loans by EU AIFs in Italy
Article 46-quarter - Other applicable provisions

Chapter III - Custodian
Article 47 - Custodian mandate
Article 48 - The custodian's duties
Article 49 - The custodian's responsibilities
Article 50 - Other applicable provisions (abrogated)

Chapter III-bis - Master-feeder structures (abrogated)
Article 50-bis - Authorisation and operating rules of master-feeder structures (abrogated)

Chapter III-ter - Merger and spin-off of asset investment bodies (abrogated)
Article 50-ter - UCI merger and spin-off (abrogated)
Article 50-quater - Cross-border merger of harmonised UCIs (abrogated)

Chapter III-quater - Management of portals for the collection of capital for innovative start-ups and innovative SMEs
Article 50-quinquies - Management of portals for the collection of capital for innovative start-ups and innovative SMEs

TITLE IV - INJUNCTIVE REMEDIES AND CRISES

Chapter I - Injunctive remedies
Article 51 - Injunctive remedies vis-a-vis Italian and non-EU intermediaries
Article 52 - Special measures for EU intermediaries
Article 53 - Suspension of administrative bodies
Article 54 - Injunction orders on EU UCIs, EU and non-EU AIFs with stakes or shares offered in Italy
Article 55 - Precautionary provisions applicable to financial advisors authorised to make off-premises offers

Chapter I-bis -Recovery plans, group financial support and early intervention
Article 55-bis - Scope of application
Article 55-ter - Recovery plans
Article 55-quarter - Group financial support
Article 55-quinquies - Early intervention

Chapter II - Crisis procedures
Article 56 - Special administration
Article 56-bis - Collective removal of the members of administrative and control bodies
Article 57 - Compulsory administrative liquidation
Article 58 - Branches in Italy of foreign investment companies and managers
Article 58-bis - Investment companies operating within the European Community
Article 59 - Compensation systems
Article 60 - Foreign intermediaries' membership of compensation systems
Article 60-bis - Responsibility of investment companies, asset management companies, SICAVs and SICAFs for illicit management depending on offence

Chapter II-bis - Winding up of investment companies
Article 60-bis.1 - Scope of application
Article 60-bis.2 - Winding up plans
Article 60-bis.3 - Winding-up possibility
Article 60-bis.4 - Winding up and other crisis management procedures

PART III - REGULATION OF MARKETS AND CENTRAL DEPOSITORIES OF FINANCIAL INSTRUMENTS

TITLE I - REGULATION OF MARKETS

Chapter I - Regulated markets
Article 60-ter - Regulation principles
Article 61 - Regulated markets for financial instruments
Article 62 - Market rules

Article 63 - Authorization of regulated markets
Article 64 - Organization and operation of markets and stock exchange companies
Article 65 - Recording of transactions in financial instruments at the stock exchange company and obligations of communication of transactions in financial instruments concluded
Article 66 - Wholesale markets in government securities
Article 66-bis - Energy and gas derivatives markets
Article 67 - Recognition of markets
Article 68 - Contract guarantee systems
Article 69 - Liquidation of the operations on non-derivative financial instruments
Article 69-bis - Authorisation and supervision of the central counterparties
Article 70 - Guarantees acquired in the exercise of the central counterparty's activity
Article 70-bis Access to the central counterparties and the liquidation systems of transactions on financial instruments
Article 70-ter Agreements concluded with the management companies of the regulated markets with central counterparties or with liquidation service management companies
Article 71 - Finality of settlement of transactions involving financial instruments (repealed)
Article 72 - Regulation of market insolvencies
Article 73 - Supervision of stock exchange companies
Article 74 - Supervision of markets
Article 75 - Extraordinary measures to protect the market and stock exchange company crises
Article 76 - Supervision of wholesale markets in government securities
Article 77 - Supervision of the contracts and liquidation guarantee systems

Chapter II - Unregulated markets
Article 77-bis - Multilateral trading systems
Article 78 - Systematic internalisers
Article 79 - Multilateral systems for the exchange of money deposits in euro

Chapter II-bis - Common provisions
Article 79-bis - Transparency requirements
Article 79-ter - Consolidation of information

TITLE II – CENTRAL DEPOSITORY SYSTEM FOR FINANCIAL INSTRUMENTS

Article 79-quater Definitions

Chapter I – Regulations for central depositories
Article 80 - Central depository activities in relation to financial instruments
Article 81 - Enactment regulation and service regulations
Article 81-bis - Access to the central depository system
Article 82 - Supervision
Article 83 - Central depositories in crisis

Chapter II – Central depository system regulations

Section I – Central depository system for dematerialisation
Article 83-bis - Scope of application
Article 83-ter - Issue of financial instruments
Article 83-quater - Central depository and intermediary duties
Article 83-quinquies - Rights of the account holder
Article 83-sexies - Right to attend shareholders’ meetings and the exercise of voting rights
Article 83-septies - Opposable exceptions
Article 83-octies - Establishing restrictions
Article 83-novies - Duties of the intermediary
Article 83-decies - Intermediary liability
Article 83-undecies - Issuer obligations
Article 83-duodecies - Shareholder identification
Article 83-terdecies - Payment of dividends

Section II – Central depository regulations for government securities
Article 84 - Identification and disclosures regarding centralised financial instruments (repealed)
Article 85 - Central deposits
Article 86 - Transfer of rights attached to financial instruments on deposit
Article 87 - Restrictions on centrally deposited financial instruments 
Article 88 - Withdrawal of centrally deposited financial instruments 
Article 89 - Updating of the shareholders’ register

Chapter III – Central depository regulations for government securities
Article 90 - Central deposit of government securities

PART IV - REGULATION OF ISSUERS

TITLE I - GENERAL PROVISIONS

Article 91 - Consob's powers
Article 91-bis - Communication of the Member State of origin
Article 92 - Equal treatment
Article 93 - Definition of control

TITLE II - SOLICITATION OF PUBLIC SAVINGS

Chapter I - Public offerings
Article 93-bis - Definitions

Section I - Public offering of EU financial instruments and financial products other than open-end UCITS units or shares
Article 94 - Obligations of offerors
Article 94-bis - Approval of the prospectus
Article 95 - Implementing provisions
Article 95-bis - Cancellation of a purchase or subscription
Article 96 - Issuer financial statements 
Article 97 - Information requirements
Article 98 - Recognition of prospectuses
Article 98-bis - Issuers from non-EU countries

Section II - Public offering of open-end UCITS units or shares
Article 98-ter - Document containing key information for investors and prospectus
Article 98-quater - Implementation provisions
Article 98-quinquies - Reporting obligations

Section III - Common provision
Article 99 - Powers of interdiction
Article 100 - Cases of inapplicability
Article 100-bis - Circulation of financial products
Article 100-ter Offers via portals for the collection of capital
Article 101 - Advertisements

Chapter II - Public offers to buy or exchange financial instruments

Section I - General provisions
Article 101-bis - Definitions and application environment
Article 101-ter - Supervisory authority and applicable law
Article 102 - Bidder obligations and prohibitive powers
Article 103 - Implementation of offers
Article 104 - Defensive measures
Article 104-bis - Breakthrough
Article 104-ter - Reciprocity clause

Section II - Mandatory public offers to buy
Article 105 - General provisions
Article 106 - Global takeover bid
Article 107 - Prior partial bids 
Article 108 - Commitment to squeeze-out
Article 109 - Squeeze-out in concert
Article 110 - Failure to comply with obligations
Article 111 - Right to squeeze-out
Article 112 - Implementing provisions

TITLE III - ISSUERS

Chapter I - Company information
Article 113 - Listing particulars
Article 113-bis - Admission to trading of open-end UCITS units or shares
Article 114 - Information to be provided to the public
Article 114-bis - Information to be provided to the market concerning the allocation of financial instruments to corporate officers, employees and collaborators
Article 115 - Information to be disclosed to Consob
Article 115-bis - Lists of persons having access to inside information
Article 116 - Financial instruments widely distributed among the public
Article 117 - Accounting information
Article 117-bis - Mergers between listed and unlisted companies
Article 117-ter - Provisions concerning ethical finance
Article 118 - Provisions not applicable
Article 118-bis - Checking information provided to the public

Chapter II - Listed companies
Article 119 - Scope

Section I - Ownership structures
Article 120 - Notification requirements for major holdings
Article 121 - Rules governing cross-holdings
Article 122 - Shareholders' agreements
Article 123 - Duration of agreements and right of withdrawal
Article 123-bis - Report on corporate governance and ownership structures
Article 123-ter Report on remuneration
Article 124 - Provisions not applicable

Section I-bis – Information on the adoption of codes of conduct
Article 124-bis - Reporting obligations regarding codes of conduct (repealed)
Article 124-ter - Disclosures regarding codes of conduct

Section II – Shareholder rights
Article 125 - Calling of shareholders' meetings at the request of minority shareholders (repealed)
Article 125-bis - Notice of call to shareholders’ meetings
Article 125-ter - Disclosure of items on the agenda
Article 125-quater - Web site
Article 126 - Notice of second and subsequent calls
Article 126-bis - Integration of the agenda of the shareholders' meeting and presentation of new resolution proposals
Article 127 - Postal or electronic voting
Article 127-bis - Voidability of resolutions and right to withdrawal
Article 127-ter - Right to ask questions prior to the shareholders' meeting
Article 127-quater - Dividend increases
Article 127-quinquies - Increased voting rights
Article 127-sexies - Multiple-voting shares
Article 128 - Complaints to the board of auditors and the courts (repealed)
Article 129 - Company actions for liability (repealed)
Article 130 - Information for shareholders
Article 131 - Right of withdrawal from mergers and spin-offs (repealed)
Article 132 - Acquisition of own or parent company shares
Article 133 - Exclusion upon request from trading
Article 134 - Increases in capital

Section II-bis – Cooperatives
Article 135 - Capital percentages
Article 135-bis - Regulations for cooperatives
Article 135-ter - Market disclosures on the assignment of financial instruments and company officers, employees or collaborators (repealed)
Article 135-quater - Extraordinary shareholders’ meeting (repealed)
Article 135-quinquies - Additions to the agenda of the shareholders' meeting  (repealed)
Article 135-sexies - Financial statements  (repealed)
Article 135-septies - Audit reports  (repealed)
Article 135-octies - Share capital increase proposals  (repealed)

Section II-ter – Proxies
Article 135-novies - Representation at the shareholders’ meeting
Article 135-decies - Conflict of interest of the representative and substitutes
Article 135-undecies - Appointed representative of a listed company
Article 135-duodecies - Cooperatives

Section III – Solicitation of proxies
Article 136 - Definitions
Article 137 - General provisions
Article 138 - Solicitation
Article 139 - Requirements for promoters (repealed)
Article 140 - Persons authorized to engage in solicitation (repealed)
Article 141 - Shareholders' associations
Article 142 - Proxies
Article 143 - Liability
Article 144 - Performance of solicitations and collections of proxies

Section IV - Savings shares and other classes of shares
Article 145 - Issue of shares
Article 146 - Special shareholders' meetings
Article 147 - Common representatives
Article 147-bis - Meetings of classes of investors

Section IV-bis – Administration bodies
Article 147-ter - Election and composition of the board of directors
Article 147-quater - Composition of the management board
Article 147-quinquies - Integrity requirements

Section V - Internal control bodies
Article 148 - Composition
Article 148-bis - Limits on the cumulation of positions
Article 149 - Duties
Article 150 - Information requirements
Article 151 - Powers
Article 151-bis - Powers of the supervisory board
Article 151-ter - Powers of the management control committee
Article 152 - Reports to the courts
Article 153 - Obligation to report to the shareholders' meeting
Article 154 - Provisions not applicable

Section V-bis - Financial information
Article 154-bis - Manager charged with preparing a company’s financial reports
Article 154-ter - Financial reporting
Article 154-quarter - Transparency of payments to governments

Section VI – Statutory audit
Article 155 - Performance of audits
Article 156 - Auditors reports 
Article 157 - Effects of audit opinions on the accounts
Article 158 - Share capital increase proposals
Article 159 - Conferment and revocation of the engagement
Article 160 - Incompatibility (repealed)
Article 161 - Special register of independent auditors (repealed)
Article 162 - Supervision of independent auditors (repealed)
Article 163 - Consob measures (repealed)
Article 164 - Liability (repealed)
Article 165 - Auditing of groups (repealed)
Article 165-bis - Companies with control of listed companies (repealed)

Section VI- bis – Relations with foreign companies having their registered office in a country that does not ensure corporate transparency
Article 165-ter - Scope
Article 165-quater - Obligations of Italian parent companies
Article 165-quinquies - Obligations of Italian affiliates
Article 165-sexies - Obligations of Italian subsidiaries
Article 165-septies - Consob’s powers and implementing provisions

PART V - SANCTIONS

TITLE I - PENAL SANCTIONS

Chapter I - Intermediaries and markets
Article 166 - Unauthorized activity
Article 167 - Breach of duty
Article 168 - Commingling of assets
Article 169 - Holdings of capital
Article 170 - Central depository services for financial instruments
Article 170-bis - Obstruction of the supervisory functions of the Bank of Italy and of Consob
Article 171 - Protection of supervision (repealed)

Chapter II - Issuers
Article 172 - Irregular acquisition of shares
Article 173 - Failure to dispose of shareholdings
Article 173-bis - False statements in prospectuses
Article 174 - False notifications and obstruction of Consob' s functions (repealed)

Chapter III - Auditing of accounts

Chapter III - Auditing of accounts
Article 174-bis - False statements in auditing firms’ reports or communications (repealed)
Article 174-ter - Corruption of auditors (repealed)
Article 175 - False statements in auditing firms' reports or communications (repealed)
Article 176 - Use and divulgence of confidential information (repealed)
Article 177 - Illegal financial relationships with the audited company (repealed)
Article 178 - Illegal compensation (repealed)
Article 179 - Common provisions (repealed)

TITLE I-BIS - INSIDER TRADING AND MARKET MANIPULATION

Chapter I - General provisions
Article 180 - Definitions
Article 181 - Inside information
Article 182 - Scope
Article 183 - Exemptions

Chapter II - Penal sanctions
Article 184 - Insider trading
Article 185 - Market manipulation
Article 186 - Accessory penalties
Article 187 - Confiscation

Chapter III - Administrative sanctions
Article 187-bis - Insider trading
Article 187-ter - Market manipulation
Article 187-quater - Accessory administrative sanctions
Article 187-quinquies - Liability of the entity
Article 187-sexies - Confiscation
Article 187-septies - Sanction procedures

Chapter IV - Consob’s powers
Article 187-octies - Consob’s powers
Article 187-nonies - Suspicious transactions

Chapter V - Relationship between proceedings
Article 187-decies - Relations with the judicial authorities
Article 187-undecies - Consob’s powers in criminal proceedings
Article 187-duodecies - Relationship between criminal proceedings and administrative and appeal proceedings
Article 187-terdecies - Collection of fines and pecuniary sanctions in criminal proceedings
Article 187-quaterdecies - Consultation procedures

TITLE II - ADMINISTRATIVE SANCTIONS

Article 187- quinquiesdecies - Safeguarding of the Bank of Italy’s and Consob’s supervisory functions
Article 188 - Unauthorized use of names
Article 189 - Holdings of capital
Article 190 - Other financial penalties regarding intermediaries, markets and the central depository system for financial instruments
Article 190-bis - Liability of company representatives and staff for violations relating to the regulation of intermediaries, markets and the centralised management of financial instruments
Article 190-ter - Other violations regarding reserved activities
Article 191 - Public offerings
Article 192 - Takeover bids or exchange tender offerings 
Article 192-bis - Corporate governance disclosures
Article 192-ter - Admission to trading
Article 192-quater - Obligation of abstention
Article 193 - Corporate disclosures and the duties of auditors, statutory auditors and independent statutory auditors
Article 193-bis - Business dealings with foreign companies having their registered office in a country that does not ensure corporate transparency
Article 193-ter Fines for breach of the prescriptions of Regulation (EU) no. 236/2012
Article 193-quarter Fines relative to breach of the provisions issued by Regulation (EU) no. 648/2012 of the European Parliament and of the Council, of 4 July 2012
Article 194 - Proxies
Article 194-bis - Criteria for determining sanctions
Article 194-ter - Sanctions for violations of directly applicable provisions of the European Union
Article 194-quater - Order to put an end to violations
Article 194-quinquies - Payment of a reduced amount
Article 194-sexies - Harmless conduct
Article 195 - Sanction procedures
Article 195-bis - Publication of sanctions
Article 195-ter - Communication to the EBA of sanctions applied
Article 195-quater - Sanctions in the case of winding up
Article 196 - Sanctions applicable to financial advisors authorised to make off-premises offers
Article 196-bis - Enactment provisions

PART VI - TRANSITIONAL AND FINAL PROVISIONS

Article 197 - Consob staff
Article 198 - Endorsement of share certificates
Article 199 - Trusts
Article 200 - Intermediaries already authorized
Article 201 - Stockbrokers
Article 202 - Rules regarding compulsory stock exchange settlement (repealed)
Article 203 - Forward contracts
Article 204 - Central depository services
Article 205 - Price quotations
Article 206 - Rules applicable to companies listed on markets other than the stock exchange
Article 207 - Shareholders' agreements
Article 208 - Proxies, saving shares, boards of auditors and auditing firms
Article 209 - Auditing firms
Article 210 - Amendments to the Civil Code
Article 211 - Amendments to the Consolidated Law on Banking
Article 212 - Provisions concerning privatizations
Article 213 - Conversion of bankruptcy into compulsory administrative liquidation
Article 214 - Repeals
Article 215 - Implementing provisions
Article 216 - Entry into force

ANNEX
SECTION A - Investment services
SECTION B - Non-core services
SECTION C - Financial instruments

PART I
COMMON PROVISIONS

Article 1
Definitions

1. In this legislative decree:

a) "Bankruptcy Law" shall mean Royal Decree no. 267 of 16 March 1942 and subsequent amendments;

b) "Consolidated Law on Banking" shall mean Legislative Decree no. 385 of 1 September 1993 and subsequent amendments;

c) "Consob" shall mean Commissione nazionale per le società e la borsa;

d) "IVASS": the Assurance Supervisory Institute2;

d-bis) "ESFS": the European System of Financial Supervision comprising the following parts:

1) "EBA": European Banking Authority, established by Regulation (EU) No 1093/2010;

2) "EIOPA": European Insurance and Occupational Pensions Authority, established by Regulation (EU) No 1094/2010;

3) "ESMA": European Securities and Markets Authority, established by Regulation (EU) No 1095/2010;

4) "Joint Committee": the Joint Committee of the European supervisory authorities, envisaged by article 54 of Regulation (EU) No. 1093/2010, of Regulation (EU) No. 1094/2010, of Regulation (EU) No. 1095/2010;

5) "ESRB": European Systemic Risk Board, established by Regulation (EU) No 1092/2010;

6) "Member State supervisory authorities": the competent authorities or supervisory authorities of Member States specified in the deeds of the Union pursuant to article 1, section 2 of Regulation (EU) No 1093/2010, of Regulation (EU) No 1094/2010 and of Regulation (EU) No 1095/20103;

e) "Italian investment company" (società di intermediazione mobiliare - SIM) shall mean an undertaking, other than a bank or a financial intermediary entered in the register referred to in Article 107 of the Consolidated Law on Banking, authorised to provide investment services or activities having its registered office and head office in Italy4;

f) "EU investment company" shall mean an undertaking, other than a bank, authorised to provide investment services or activities having its registered office and head office in the same member state of the European Union, other than Italy5;

g) "non-EU investment company" shall mean an undertaking, other than a bank, authorised to provide investment services or activities having its registered office in a state that is not a member of the European Union6;

h) "investment companies" shall mean Italian investment companies and EU and non-EU investment companies;

i) "variable capital investment company" (SICAV): open-ended UCI constituted in the form of a joint stock company with variable capital with registered office and general management in Italy with the exclusive purpose of the collective investment of the assets obtained by the offer of its own shares7;

i-bis) "fixed capital investment company" (SICAF): closed-ended UCI constituted in the form of a joint stock company with fixed capital with registered office and general management in Italy with the exclusive purpose of the collective investment of the assets obtained by the offer of its own shares and other financial instruments of equity held by the same8;

i-ter) "staff": employees and those who, in any case, operate on the basis of relationships that determine inclusion in the corporate organization, even in a form other than an employment relationship9;

j) "investment fund": UCI constituted in the form of an enterprise with independent equity, divided into units, set up and managed by a fund manager10;

k) "Undertaking for Collective Investment" (UCI): body set up to provide the service of the collective management of assets, the capital of which is obtained from multiple investors by the issue and offer of units or shares, managed upstream in the investors' interests and independently by the same and also invested in financial instruments, credit, including credit backed, in favour of subjects other than consumers, by the UCITS capital, equity or other fixed or non-fixed assets, on the basis of a predetermined investment policy11;

k-bis) "Open-ended UCI": UCI the investors of which have the right to request redemption of the units or shares of the capital of the same, according to procedures and with the frequency contemplated by the regulation, by the articles of association and by the UCI offer documentation12;

k-ter) "Closed-ended UCI": UCI other than open-ended UCIs13;

l) "Italian UCIs": investment funds, SICAVs and SICAFs14;

m) "Italian undertaking for the collective investment in transferable securities" (Italian UCITS): investment funds and SICAVs falling within the scope of the application of Directive 2009/65/EC15;

m-bis) “Undertaking for the collective investment in EU transferable securities” (EU UCITS): UCIs falling within the scope of application of Directive 2009/65/EC, set up in an EU State other than Italy16;

m-ter) “Italian alternative UCI” (Italian AIF): investment funds, SICAVs and SICAFs falling within the scope of application of Directive 2011/61/EU17;

m-quater) “Italian reserved AIF”: Italian AIF, participation in which is reserved to professional investors and the investor categories indicated by the regulation referred to in article 3918;

m-quinquies) “EU alternative UCI” (EU AIF): UCIs falling within the scope of application of Directive 2011/61/EC, set up in an EU State other than Italy19;

m-sexies) “Non-EU alternative UCI” (non-EU AIF): UCIs falling within the scope of application of Directive 2011/61/EC, set up in a State not belonging to the EU20;

m-septies) “European Venture Capital Fund” (EuVECA): UCI falling within the scope of application of Regulation (EU) no. 345/201321;

m-octies) “European Social Entrepreneurship Fund” (EuSEF): UCI falling within the scope of application of Regulation (EU) no. 346/201322;

m-novies) “feeder UCI”: the UCI which invests its assets entirely or mainly in the master UCI23;

m-decies) “master UCI”: the UCI in which one or more feeder UCIs invest all or most of their assets24;

m-undecies) “professional investors”: professional clients as contemplated by article 6, subsections 2-quinquies and 2-sexies25;

m-duodecies) “retail investors”: investors who are not professional investors26;

n) "collective asset management": the service which is carried out through the management of UCIs and of the relative risks27;

o) "asset management company" (società di gestione del risparmio - SGR) shall mean a società per azioni having its registered office and head office in Italy authorised to provide the service of collective portfolio management;28

o-bis) "EU management company": company authorised pursuant to Directive 2009/65/EC in an EU State other than Italy, which practises the management of one or more UCITS29;

p) "EU AIF manager" (AIFM): company authorised pursuant to Directive 2011/61/EU in an EU state other than Italy, which practises the management of one or more AIFs30;

q) "non-EU AIF manager" (non EU AIFM): company authorised pursuant to Directive 2011/61/EU with registered office in a state not belonging to the EU, which practises the management of one or more AIFs31;

q-bis) "manager": asset management company, SICAV or SICAF which directly manages its own capital, an EU management company, an EU AIFM, a non-EU AIFM, and a EuSEF manager32;

q-ter) "UCI custodian": the subject authorised in the country of origin of the UCI to undertake mandate as custodian33;

q-quater) "master UCI custodian or feeder UCI custodian": the custodian of a master UCI or a feeder UCI or, if the master UCI or the feeder UCI is an EU or non-EU UCI, the subject authorised in the Home State to act as custodian34;

q-quinquies) "UCI units and shares": the units of investment funds, SICAV shares and the shares and other financial instruments held by SICAFs35;

r) "authorised subjects": investment companies, Community investment companies with branch in Italy, non-Community investment companies, asset management companies, EU management companies with branch in Italy, SICAVs, SICAFs, EU AIFMs with branch in Italy, non-EU AIFMs authorised in Italy, non-EU AIFMs authorised in an EU state other than Italy with branch in Italy, and financial brokers registered on the list contemplated by article 106 of the Consolidated Law on Banking and Italian banks, Community banks with branch in Italy and non-Community banks authorised to practice investment services or activities36;

r-bis) “Home Member State of the EU management company”: the EU Member State where the EU management company has its registered office and general management37;

r-ter) “Home Member State of the UCITS”: EU Member State in which the UCITS was established38;

r-quater) 'credit rating': an opinion on the credit rating of an entity, as defined by Article 3, paragraph 1, letter a) of Regulation (EC) No 1060/200939;

r-quinquies) 'credit ratings agency': a legal entity whose business includes issuing credit ratings on a professional level40;

s) "services subject to mutual recognition" shall mean the activities and services listed in sections A and B of the table annexed to this decree, authorised in the home EU member state41;

t) "public offering or investment incentive" shall mean every offer or incentive, invitation to offer or promotional message, in whatsoever form addressed to the public, whose objective is the sale or subscription of financial products including the allocation through authorised people; 42

u) "financial products" shall mean financial instruments and every other form of investment of a financial nature; bank or postal deposits without the issue of financial instruments shall not constitute financial products; 43

v) "public offer to buy or exchange" shall mean every offer, invitation to offer or promotional message, in whatsoever form effected, whose objective is the purchase or exchange of financial products, addressed to a number of persons and of a total amount greater than that indicated in the regulation pursuant to article 100, subsection 1, paragraphs b) and c); an offering of securities issued by the central banks of EU Member States shall not constitute a mandatory takeover bid or exchange tender offering44;

w) “listed issuers”: the subjects, Italian or foreign, including trusts, which issue financial instruments listed on a regulated Italian market. In the case of deposit receipts admitted for trading on a regulated market, the term issuer refers to the issuer of the securities represented, even if such securities are not admitted for trading on a regulated market45;

w-bis) “financial products issued by insurance companies”: the policies and operations referred to in the sectors on Life III and V according to Article 2, Subsection 1, of the Legislative Decree No. 209 of 7th September 2005, with the exclusion of individual pension schemes according to Article 13, Subsection 1, paragraph b), of Legislative Decree No. 252 of 5th September 2005. 46

w-ter) “regulated market”: shall mean a multilateral system which permits or facilitates the meeting, internally and according to non-discretional regulations, of multiple third party purchase and sale interests with regard to financial instruments, admitted to trading in compliance with the rules of the market, in order to effect contracts, and which is operated by a management company, is authorised and operates regularly47.

w-quater) “listed issuers with Italy as home member state”:

1) the issuers with shares admitted to trading on Italian regulated markets or of another Member State of the European Union, with registered office in Italy48;

2) issuers of debt securities with a nominal unit value of less than one thousand Euro, or corresponding value in a different currency, admitted to trading on Italian regulated markets or those of another Member State member of the European Union, with registered office in Italy49;

3) the issuers of securities referred to under numbers 1) and 2), with registered office in a country not belonging to the European Union, which have chosen Italy as Member State of origin from the Member States in which their securities are admitted for trading on a regulated market. The choice of the Member State of origin remains valid unless the issuer has chosen a new Member State of origin pursuant to number 5) and has communicated this choice50;

4) issuers of securities other than those indicated under points 1) and 2), with registered office in Italy or whose securities are admitted to trading on an Italian regulated market and who have adopted Italy as the home Member State. The issuer may choose one Member State only as the home member state. The decision shall remain valid for at least three years, unless the issuer's securities are no longer admitted to trading on any market of the European Union, or unless the issuer, in the three-year term, is included in the issuers referred to under numbers 1), 2), 3) and 4-bis), of this letter51;

4-bis) the issuers referred to under numbers 3) and 4) whose securities are no longer admitted for trading on a regulated market of the Member State of origin, but which are admitted for trading on an Italian regulated market or that of other Member States and, if necessary, with registered office in Italy or which has chosen Italy as a new Member State of origin52 / 53;

w-quater.1) "SME": without prejudice to what is contemplated by other provisions of law, listed small and medium enterprises, whose sales also prior to the admission of their own shares for trading, have a turnover of less than Euro 300 million, or which have a market capitalisation of below Euro 500 million. Issuers of listed shares which have exceeded both the aforesaid limits for three consecutive years are not considered SMEs. Consob establishes by regulation the implementation provisions of this letter, including the disclosure obligations of such issuers in respect of the acquisition or loss of the qualification of SME. Consob, on the basis of the information provided by the issuers, publishes the list of SMEs on its own Internet site 54;

w-quinquies) "central counterparties": the subjects indicated in article 2, point 1), of Regulation (EU) no. 648/2012 of the European Parliament and of the Council, of 4 July 2012, concerning OTC derivative instruments, central counterparties and the recorded data on the transactions55.

w-sexies) “recovery provisions”: the provisions which provide for:

1) the extraordinary administration, and the measures adopted within the sphere of the same;

2) the measures adopted pursuant to article 60-bis.4;

3) the measures, equivalent to those indicated under points 1 and 2, adopted by authorities of other Community States56.

1-bis. “Securities” shall mean categories of securities for trading on the capital market, such as:

a) company shares and other shares equivalent to shares of companies, partnerships or other persons and share deposit certificates;

b) bonds and other debt securities, including certificates of deposit relating to such securities;

c) any other security normally negotiated which permits the purchase or sale of securities indicated in the preceding paragraphs;

d) any other security usually involving cash settlement determined with reference to securities indicated in the preceding paragraphs, to currency, interest rates, returns, commodities, indices or measures57.

1-ter. “Money market instruments” shall mean categories of instruments normally negotiated on the money market, such as Treasury bonds, certificates of deposit and commercial bills58.

2. "Financial instruments" shall mean:

a) securities;

b) money market instruments;

c) units in collective investment undertakings;

d) options, futures, swaps, futures contracts on interest rates and other derivative contracts linked to securities, currency, interest rates or returns, or other derivatives, financial indices or measures that may be settled by the physical delivery of the underlying asset or by cash payment of differentials;

e) options, futures, swaps, interest rate swaps, and any other derivative contracts on commodities, settlement of which is by payment of the differentials in cash, or at the discretion of one of the parties, except in cases where such option is the result of default or other event leading to cancellation of the contract;

f) options, futures, swaps and other derivative contracts on commodities, the settlement of which may be by physical delivery of the underlying asset and which are traded on a regulated market and/or multilateral trading systems;

g) options, futures, swaps, forward contracts and other derivative contracts on commodities, the settlement of which may be by physical delivery of the underlying asset, other than those indicated in paragraph f), that have no commercial purpose, and with the characteristics of other derivatives, taking into consideration, amongst other things, whether they are cleared and executed through recognised clearing houses or whether they are subject to regular margin calls;

h) derivatives for the transfer of credit risk;

i) differential financial contracts;

j) options, futures, swaps, futures contracts, swaps, futures contracts on interest rates and other derivative contracts related to climatic variables, transport rates, emission levels, inflation rates or other official economic statistics, settled by cash payment of differentials or at the discretion of one of the parties, except in cases where such option is the result of default or other event leading to cancellation of the contract and other derivative contracts on assets, options, bonds, indices and measures other than those indicated in previous paragraphs, with the characteristics of other derivative financial instruments, taking into consideration, amongst other things, whether are traded on a regulated market or multilateral trading systems, whether they are cleared and executed through a recognised clearing house or whether they are subject to regular margin calls 59.

2-bis. The Minister of the Economy and Finance, by the regulation pursuant to Article 18, subsection 5, shall identify:

a) the other derivative contracts pursuant to subsection 2, paragraph g), with the characteristics of other derivatives, cleared and executed through recognised clearing houses or subject to regular margin calls;

b) the other derivative contracts pursuant to subsection 2, paragraph j), with the characteristics of other derivatives, traded on a regular market or through multilateral trading systems, cleared and executed through recognised clearing houses or subject to regular margin calls60;

3. "Derivatives" shall mean the financial instruments specified in subsection 2, paragraphs d), e), f), g), h), i) and j), as well as the financial instruments specified in subsection 1-bis, paragraph d) 61.

4. The payment instruments are not financial instruments. Financial instruments, and specifically swaps, are foreign currency buy and sell contracts, extraneous to commercial transactions and settled on the difference, also by means of automatic “roll-over” transactions. The additional foreign currency transactions identified pursuant to article 18, subsection 5, are also financial instruments62.

5. "Investment services and activities" shall mean the following activities where they concern financial instruments:

a) dealing for own account;

b) execution of orders for clients;

c) subscription and/or placement with firm commitment underwriting or standby commitments to issuers;

c-bis) placement without firm or standby commitment to issuers;

d) portfolio management;

e) reception and transmission of orders;

f) investment consultancy,

g) management of multilateral trading systems63.

5-bis. Trading on own account shall mean buy and sell transactions of financial instruments, directly and in relation to customer orders, together with market maker activities64..

5-ter. Systematic internaliser shall mean the person who, in an organised, frequent and systematic manner, trades on his own account executing customer orders outside a regulated market or multilateral trading systems65.

5-quarter. Market maker shall mean a person offering his services to trade directly on regulated markets and multilateral trading systems on a continuous basis, buying and selling financial instruments at self-established prices66.

5-quinquies. Portfolio management shall mean the management, on a discretional and individual basis, of portfolio investments which include one or more financial instruments and according to mandate conferred by customers67.

5-sexies. The service pursuant to subsection 5, paragraph e), including the receipt and transmission of orders as well as consistent activities to place two or more investors in contact, thereby making it possible to conclude transactions by mediation68.

5-septies. “Investment consultancy” shall mean the provision of customised recommendations to a customer upon request or as an initiative by the service provider, regarding one or more transaction on an identified financial instrument. The recommendation shall be customised when it is presented as suitable for the customer or is based on consideration of the customer’s characteristics. A recommendation shall not be customised if disclosed to the public through distribution channels69.

5-octies. Multilateral trading systems management shall mean the management of multilateral trading systems which permit the meeting, within and on the basis of non-discretional rules, of multiple third party purchase and sale interests relating to financial instruments, in such a way as to give rise to contracts70.

5-novies. “Portal for the collection of capital for innovative start-ups and innovative SMEs” means an online platform with the exclusive purpose of facilitating the collection of risk capital by innovative start-ups, including those with a social purpose, innovative SMEs and collective investment bodies or other companies which invest primarily in innovative start-ups or innovative SMEs, as identified by points e) and f) respectively of section 2, article 1 of the Ministry of Economy and Finance Decree dated 30 January 2014, published in Official Gazette no. 66 of 20 March 201471.

5-decies. An "innovative start-up” refers to a company as defined by article 25, subsection 2, of Italian decree law n° 179 of 18 October 201272.

5-undecies. “Small and medium-sized innovative company” or “innovative SME” means the SME defined by article 4, section 1 of Decree Law no. 3 of 24 January 201573.

6. "Non-core services" shall mean the following:

a) safekeeping and administration of financial instruments and related services74;

b) safe custody services;

c) lending to investors to enable them to carry out transactions in financial instruments where the lender is involved in the transaction;

d) advice to undertakings on capital structure, industrial strategy and related matters and advice and services relating to mergers and the purchase of undertakings;

e) services related to the issue or placement of financial instruments, including the organisation and constitution of underwriting and placement syndicates;

f) Investment research and financial analysis or other forms of general recommendation regarding transactions on financial instruments75;

g) foreign exchange trading where this is connected with the provision of investment services.

g-bis) activities and services identified by regulation by the Minister of the Economy and Finance, after consulting the Bank of Italy and Consob, and relating to the provision of investment or accessory services on derivatives76.

6-bis. "Shareholdings or holdings" shall mean shares, capital parts and other financial instruments that confer administrative rights or in any case those provided for by the final subsection of Article 2351 of the Civil Code.77

6-ter. Except as specified, the provisions of this legislative decree that refer to the board of directors, the administrative body or the directors shall also apply to the management board and the members thereof.78

6-quater. Except as specified, the provisions of this legislative decree that refer to the board of auditors, the members thereof or the control body shall also apply to the supervisory board, the management control committee and the members thereof.79

Article 2
Relationship to European Union law and integration in ESFS

1. The Ministry of the Economy and Finance, the Bank of Italy and Consob shall exercise the powers conferred on them in harmony with the provisions of the European Union, apply the regulations and decisions of the European Union and act on the recommendations concerning matters governed by this decree.

2. In exercising their respective competences, the Bank of Italy and Consob are parties to the ESFS and participate in its activities, considering the convergence within Europe of supervisory practices and instruments.

2-bis. The authorities indicated in subsection 1 shall exercise, each to the extent applicable, the intervention powers attributed to them by Parts I and II of this Legislative Decree also to ensure compliance with EU regulation no. 575/2013, the relevant technical regulatory and implementing rules issued by the European Commission pursuant to Articles 10 and 15 of EU Regulation no. 1093/2010, or in the event of non-compliance with the directly applicable ESMA and EBA acts adopted under these regulations80.

3. In cases of crisis or tension on financial markets, the Bank of Italy and Consob consider the effects of their action on the stability of the financial system of the other Member States, also using the appropriate exchange of information with European Securities and Markets Authority, the Joint Committee, European Systemic Risk Board and the supervisory authorities of other Member States81.

Article 3
Administrative measures

1. The ministerial regulations referred to in this decree shall be adopted under Article 17(3) of Law 400/1998.

2. The Bank of Italy and Consob shall establish the time limits and procedures for the adoption of the measures falling within the scope of their respective authority.

3. The regulations and measures of general application adopted by the Bank of Italy and Consob shall be published in the Official Journal of the Italian Republic. Other important measures concerning persons subject to supervision are published by the Bank of Italy on its website and by Consob, in electronic format, in its Bulletin82.

4. By 31 January of each year the Ministry of the Economy and Finance,83 shall publish all the regulations and measures of general application issued under this decree as well as the rules governing the markets in a single compendium, which may be in electronic form, where even one such document has been amended during the preceding year.

Article 4
Cooperation between authorities and professional secrecy

1. The Bank of Italy, Consob, the Commissione di vigilanza sui fondi pensioni and IVASS shall cooperate by exchanging information and otherwise for the purpose of facilitating their respective functions. Said authorities may not invoke professional secrecy in their mutual relations84.

2. The Bank of Italy and Consob collaborate, also through the exchange of information, with the authorities and committees comprising the ESFS, in order to facilitate their respective duties. In the cases and ways established by European legislation, they fulfil the disclosure obligations with regards to said parties and other authorities and institutions indicated by the provisions of the European Union85.

2-bis. For the purposes specified under subsection 2, Consob and the Bank of Italy can stipulate cooperation agreements with the competent authorities of the European Union Member States and with ESMA, which may provide for the mutual delegation of supervisory duties. Consob and the Bank of Italy may use ESMA to solve disputes with the supervisory authorities from the other Member States in cross-border situations86.

2-ter. Consob shall be the point of contact for the receipt of requests for information from competent authorities of EU member states regarding investment services and activities performed by authorised persons and regulated markets. Consob shall cooperate with the Bank of Italy on aspects for which the latter is responsible. The Bank of Italy shall submit information simultaneously to both the competent authority of the EU member state issuing the request and to Consob87.

3. The Bank of Italy and Consob may cooperate by exchanging information and otherwise with the competent authorities of non-EU countries88.

4. Information received by the Bank of Italy and Consob pursuant to subsections 1, 2 and 3 may not be transmitted to third parties or other Italian authorities, including the Minister of the Economy and Finance, without the consent of the authority that supplied it.89

5. The Bank of Italy and Consob may exchange information:

a) with administrative and judicial authorities in connection with winding-up or bankruptcy proceedings in Italy or abroad involving authorised intermediaries;

b) with bodies responsible for the administration of compensation systems;

c) with the bodies appointed to provide for the clearing or the liquidation of the transactions on the markets90;

d) with stock exchange companies, for the purpose of ensuring the regular operation of the markets they manage.

5-bis. The exchange of information with authorities of non-EU countries shall be subject to the existence of provisions concerning professional secrecy.91

6. The information referred to in subsection 5, paragraphs b), c) and d), may be disclosed to third parties with the consent of the person who supplied it. Such consent shall not be necessary where the information has been provided in compliance with domestic and international cooperation obligations.

7. The Bank of Italy and Consob may also exercise the powers conferred on them by law for the purpose of cooperating with other authorities and at the request thereof. The competent authorities of EU and non-EU countries may ask the Bank of Italy and Consob to carry out investigations in Italy on their behalf pursuant to the provisions of this decree, and to issue notifications on their behalf in Italy in relation to measures taken by them. Such authorities may ask for members of their staff to be allowed to accompany the personnel of the Bank of Italy and Consob during the performance of the investigations.92

8. For any other purpose the provisions governing professional secrecy in respect of information and data in the possession of the Bank of Italy shall be unaffected.

9. In order to facilitate the supervision on a consolidated basis with regards to groups operating in several different European Community States, on the basis of agreements reached with the competent authorities, the Bank of Italy defines forms of collaboration and coordination, institutes supervisory boards and participates in the boards instituted by other authorities. Under this scope, the Bank of Italy may agree specific allocations of tasks and delegations of functions93.

10. All the information and data possessed by Consob by virtue of its supervisory activity shall be covered by professional secrecy, with respect to governmental authorities as well, except for the Minister of the Economy and Finance.94 The cases in which the law provides for investigations of violations subject to criminal sanction shall be unaffected.

11. In the performance of their supervisory functions employees of Consob shall be public officials and required to report any irregularities which they may discover exclusively to Consob, even where such irregularities appear to be criminal offences.

12. Employees of Consob and consultants and experts engaged by Consob shall be bound by professional secrecy.

13. Governmental authorities and public entities shall provide the information, documents and every further form of cooperation requested by Consob in accordance with the laws governing each authority or entity.

Article 4-bis
Identification of the competent authority and sector competent authorities for the purpose of Regulation (EC) No. 1060/2009 as subsequently amended, in relation to credit ratings agencies

1. Consob is the competent authority in accordance with Article 22 of Regulation (EC) No 1060/2009 of the European Parliament and Council of 16 September 2009 relative to the credit ratings agencies, and exercises the powers envisaged by said Regulation.

2. Consob, the Bank of Italy, IVASS and COVIP are the competent sector authorities in accordance with Article 3, paragraph 1, letter r) of the regulation pursuant to subsection 1. Said authorities collaborate and exchange information, also on the basis of specific memorandums of understanding95.

Article 4-ter
Identification of the national authorities with competence pursuant to regulation (EU) n° 236/2012 on short selling and certain aspects of derivative contracts for hedging the credit default swap risk

1. The Ministry of Economy and Finance, the Bank of Italy and Consob are the national competent authorities pursuant to regulation (EU) n° 236/2012 relative to short selling and certain aspects of derivative contracts for hedging the credit default swap risk, as laid down by the following subsections.

2. Consob is the competent authority for receiving the notifications, implementing the measures and exercising the functions and powers contemplated by the regulation referred to in subsection 1 in reference to financial instruments other than sovereign debt instruments and credit default swaps of sovereign issuers.

3. Without prejudice to the provision of subsection 4, the Bank of Italy and Consob, within the sphere of their respective powers, are the competent authorities for receiving the notifications, implementing the measures and exercising the functions and powers contemplated by the regulation referred to in subsection 1 in respect of sovereign debt instruments and credit default swaps of sovereign issuers.

4. With regard to sovereign debt and credit default swaps of sovereign issuers, the powers of temporary suspension of the restrictions and powers to intervene in exceptional circumstances, contemplated by the regulation referred to in subsection 1, are exercised by the Ministry of Economy and Finance, on proposal by the Bank of Italy and after consultation with Consob.

5. Consob is the authority responsible for coordinating the cooperation and exchange of information with the European Union Commission, AESFEM, and the competent authorities of the other Member States, pursuant to article 32 of the regulations referred to in subsection 1.

6. In order to coordinate the exercise of the functions referred to in subsections 3 and 4, the Ministry of Economy and Finance, the Bank of Italy and Consob, by means of a memorandum of understanding, establish the procedures of the cooperation and of the reciprocal exchange of relevant information in order to exercise the aforesaid functions, also in the case of irregularities found and the measures adopted in the exercise of their respective duties and the procedures for receiving the aforesaid notifications, taking into account the need to reduce to a minimum the costs bearing on the operators.

7. The Bank of Italy and Consob, to fulfil their respective duties as defined by this article and to ensure respect for the measures adopted pursuant to the Regulation referred to in subsection 1, including those delegated to the Ministry of Economy and Finance pursuant to subsection 4, hold the powers contemplated by article 187-octies96.

Article 4-quater97
Identification of the national authorities with competence pursuant to regulation (EU) no. 648/2012 of the European Parliament and of the Council, of 4 July 2012

1. The Bank of Italy and Consob are the competent authorities for the authorisation and supervision of the central counterparties, pursuant to article 22, paragraph 1, of Regulation (EU) no. 648/2012, pursuant to the provisions of the following sections and of article 69-bis.

2. Consob is the competent authority, pursuant to article 22, paragraph 1, of the regulation referred to in section 1, for the coordination of the cooperation and of the exchange of information with the European Commission, the European Securities and Markets Authority (ESMA), the competent authorities of the other Member States, the European Banking Authority (EBA) and the relevant members of the European system of central banks, pursuant to articles 23, 24, 83 and 84 of the regulation referred to in section 1.

2-bis. Bank of Italy, Consob, IVASS and the Commissione di vigilanza sui fondi pensioni (COVIP) are the competent authorities for the respect of the obligations under the terms of the regulation referred to in subsection 1 on entities supervised by the same authorities, according to the respective powers of supervision98.

3. Pursuant to Article 10, paragraph 5, of the Rules referred to in subsection 1, Consob is the competent authority in respect of non-financial counterparties that are not subject to supervision by any other authority in accordance with paragraph 2-bis of the this Article, compliance with the obligations laid down in Articles 9, 10 and 11 of that Regulation. For this purpose Consob exercises the powers contemplated by article 187-octies of this Legislative Decree, according to the procedures established thereby, and can dictate provisions on the procedures for the exercise of supervisory powers99.

4. The Bank of Italy introduces, manages and controls the authoritative board contemplated by article 18 of the regulation referred to by section 1.

5. The Bank of Italy is the competent authority pursuant to article 25, paragraph 3, letter a), of the regulation referred to by section 1, within the sphere of the procedure for recognition of the central counterparties of third countries; the opinion is submitted to the ESMA by the Bank of Italy, with the agreement of Consob.

Article 4-quinquies
Identification of the national authorities with competence pursuant to regulation (EU) no. 345/2013, relative to the European Venture Capital Fund (EuVECA), and regulation (EU) no. 346/2013, relative to the European Social Entrepreneurship Fund (EuSEF)

1. The Bank of Italy and Consob, according to their respective powers and purposes indicated in article 5, are the national authorities with competence pursuant to regulation (EU) no. 345/2013 and regulation (EU) no. 346/2013. The Bank of Italy and Consob transmit without delay the information they must each receive pursuant to this article.

2. The Bank of Italy, after consulting Consob, registers and cancels Italian EuVECA and EuSEF managers pursuant to article 14 of regulation (EU) no. 345/2013 and article 15 of regulation (EU) no. 346/2013. Such managers are listed in a separate section of the register referred to in article 35, held by the Bank of Italy. Articles 35, subsections 2 and 3, and 35-undecies and the relative enactment rules are applied as far as compatible with regulation (EU) no. 345/2013 and regulation (EU) no. 346/2013.

3. The Bank of Italy is the authority with competence to receive from Italian EuVECA and EuSEF managers the communication required by article 15 of regulation (EU) no. 345/2013 and article 16 of regulation (EU) no. 346/2013. It also receives the communication of the intention of changing the domicile of the premises of a UCI, contemplated by article 16 of regulation (EU) no. 345/2013 and article 17 of regulation (EU) no. 346/2013.

4. Consob severs the notifications contemplated by article 16 of regulation (EU) no. 345/2013 and article 17 of regulation (EU) no. 346/2013 on the competent authorities of the Member States in which the Italian EuVECA and EuSEF managers are registered pursuant to subsection 2 intend to market the relative UCIs in compliance with the rulings of the said regulations.

5. EuVECA or EuSEF managers established in a Member State other than Italy which satisfy the requisites of regulations (EU) no. 345/2013 and no. 346/2013 and which intend to market in Italy the UCIs which they manage, must provide for the serving, through the competent authority of the Home State, of the notification required by article 16 of regulation (EU) no. 345/2013 and article 17 of regulation (EU) no. 346/2013, once they have obtained registration pursuant to the said regulations. Consob is the authority to which said notification must be delivered.

6. If the threshold indicated in article 3, paragraph 2, letter b), of Directive 2011/61/EU, the provisions contemplated for the manager by this legislative decree and the relative enactment provisions apply to the managers indicated in subsections 2 and 5. In such a case, the name EuVECA or EuSEF can be maintained only if contemplated by the aforesaid EU regulations.

7. To ensure respect for this article, and for the regulations indicated in subsection 1, the Bank of Italy and Consob, according to their respective powers and purposes pursuant to article 5, have the faculties attributed to the same by this legislative decree100.

PART II
REGULATION OF INTERMEDIARIES

TITLE I
GENERAL PROVISIONS

Chapter I
Supervision

Article 5
Purpose and scope

1. The objectives of supervisory activities indicated in this section shall be:

a) the safeguarding of faith in the financial system;

b) the protection of investors;

c) the stability and correct operation of the financial system;

d) competitiveness of the financial system;

e) the observance of financial provisions101.

2. For the pursuance of objectives indicated in subsection 1, the Bank of Italy shall be responsible for risk containment, asset stability and the sound and prudent management of intermediaries102.

3. For the pursuance of objectives indicated in subsection 1, Consob shall be responsible for the transparency and correctness of conduct103.

4. The Bank of Italy and Consob shall exercise supervisory powers over authorised persons. Each shall supervise the observance of regulatory and legislative provisions according to their respective responsibilities as defined in subsections 2 and 3104.

5. The Bank of Italy and Consob shall operate in a coordinated manner, inter alia with a view to minimizing the costs incurred by authorised intermediaries, and shall notify each other of the measures adopted and the irregularities discovered in carrying out their supervisory activity.

5-bis. The Bank of Italy and Consob, with the aim of coordinating their supervisory duties and reducing to a minimum the onus on authorised persons, shall stipulate a protocol of understanding in relation to:

a) the responsibility of each and task performance methods, according to the prevalence criteria of duties pursuant to subsections 2 and 3;

b) the exchange of information, also with reference to irregularities discovered and measures adopted in the exercise of supervisory activities105.

5-ter. The protocol of understanding pursuant to subsection 5-bis shall be made public by the Bank of Italy and Consob according to jointly agreed methods, and shall be attached to the regulation pursuant to Article 6, subsection 2-bis106.

Article 6
Regulatory powers

01. In the exercise of supervisory functions, the Bank of Italy and Consob shall observe the following principles:

a) valuation of the decision-making autonomy of authorised persons;

b) proportionality, intended as a criterion for the exercise of power suited to achieving the purpose, with the minimum sacrifice of addressees' interests;

c) recognition of the international character of the financial market and safeguarding of the competitive position of Italian industry;

d) facilitation of innovation and competition107.

02. With regard to matters governed by Commission Directive 2006/73/EC of 10 May 2006, the Bank of Italy and Consob may maintain or impose by regulation additional obligations to those of the said directive only in exceptional cases in which such obligations are objectively justified and proportionate, taking into account the need to face specific risks to protect investors or market integrity which are not adequately considered in the European provisions, and if at least two of the following conditions are satisfied:

a) the specific risks which the added obligations aim to face are particularly significant, considering the structure of the Italian market;

b) the specific risks which the added obligations aim to face should emerge or become evident after the issue of related European provisions108.

03. The Bank of Italy and Consob shall inform the Minister of the Economy and Finance of the regulatory provisions containing additional obligations pursuant to subsection 02 for the purposes of notifying the European Commission109.

1. The Bank of Italy, after consulting Consob, shall issue a regulation on:

a) obligations of SIMs and SGRs in terms of capital adequacy, limitation of risk in its various forms and equity interests, and information to be provided to the public on the same matters and on corporate governance, administrative and accounting procedures, internal controls and remuneration and incentive systems110;

b) the obligations of the investment brokers, non-EU investment firms, asset management companies and financial intermediaries registered on the list pursuant to Article 107 of the Consolidated Law on Banking, Italian banks and non-EU banks, authorised to provide investment or services on the method by which to deposit or sub-deposit financial instruments and money pertaining to customers111;

c) the rules applicable to Italian UCIs regarding:

1) the criteria and bans relative to the investment activity, also regarding group agreements;

2) the prudential provisions for risk containment and fractioning, in the case of UCIs other than reserved AIFs. The Bank of Italy may contemplate the application to Italian reserved AIFs of a financial lever ceiling and of prudential provisions to ensure the stability and integrity of the financial market;

3) the layout and drafting procedures of the accounting statements which asset management companies, SICAVs and SICAFs must periodically produce;

4) the methods for the calculation of the value of the UCI units or shares;

5) the criteria and procedures for evaluating the assets and valuables in which the capital is invested and the frequency of said evaluation. For the evaluation of assets not traded on regulated markets, the Bank of Italy may contemplate the use of the services of independent experts and may request their intervention also in the case of purchases and sales of the assets on the part of the manager;

6) the conditions for delegation to third parties of the evaluation of the assets in which the UCI capital is invested and the calculation of the value of the relative units and shares112.

1-bis. The provisions pursuant to subsection 1, paragraph a) allow for the adoption of internal risk measurement systems to determine equity requirements, subject to authorisation by the Bank of Italy, and for the use of credit risk assessments issued by the company or external authorities113.

2. Consob, after consulting the Bank of Italy and taking into account the different need for protection of investors in relation to their nature and professional experience, shall issue a regulation governing the obligations of authorised intermediaries on:

a) transparency, including:

1) reporting obligations on the provision of investment services and activities, and collective asset management services, with particular reference to the level of risk of each type of financial product and portfolio management offered, to the companies and to services provided, to the safeguarding of financial instruments or cash equivalents held by the company, and the costs, incentives and strategies for executing orders;

2) the methods and criteria to be adopted in advertising and promotion communications and investment research;

3) obligations to inform customers regarding the execution of orders, portfolio management, transactions with potential liabilities and statements of customers’ financial instruments or cash equivalents held by the company;

3-bis) the information obligations towards the investors of Italian AIFs, EU AIFs and non-EU AIFs114;

b) correctness of conduct, including:

1) obligations to obtain information from customers or potential customers with the aim of assessing the adequacy or appropriateness of the transactions or services provided;

2) measures for the execution of orders under the best conditions for customers;

3) obligations relating to order management;

4) the obligation to ensure that portfolio management is performed in a manner consistent with the specific needs of individual investors, and that on a collective basis is performed in observance of the aims of UCITS investments;

5) the conditions under which incentives may be paid or received115.

2-bis. The Bank of Italy and Consob shall jointly govern the obligations of authorised persons, by regulation and in reference to the provision of investment services and activities, together with collective asset management services, on matters of;

a) corporate governance, general requirements of organisation, remuneration and incentive systems116;

b) business continuity;

c) administrative and accounting organisation, including establishment of a department pursuant to paragraph e)

d) procedures, including internal audit, for the correct and transparent provision of investment services and activities together with collective asset management services;

e) monitoring of compliance with regulations;

f) company risk management;

g) internal audit;

h) top management responsibilities;

i) complaint handling;

j) personal transactions;

k) outsourcing of essential or important operations, services or activities;

l) management of conflict of interest potentially prejudicial to customers;

m) record keeping;

n) procedures including internal audit, for the receipt or payment of incentives117.

2-ter. For supervision purposes, pursuant to subsection 2-bis, the responsible parties shall be:

a) The Bank of Italy for aspects pursuant to paragraphs a), b), c), f), g) and h);

b) Consob for aspects pursuant to paragraphs d), e), i), j), l), m) and n);

c) The Bank of Italy and Consob, according to their respective duties pursuant to Article 5, subsections 2 and 3, and for aspects pursuant to paragraph k)118.

2-quater. By regulation and after consulting the Bank of Italy, Consob shall identify:

a) standards of conduct which shall not apply in relations between managers of multilateral trading systems and their participants;

b) the conditions in which authorised persons shall not be obliged to observe regulatory provisions pursuant to subsection 2, paragraph b), subparagraph 1), when they provide services pursuant to Article 1, subsection 5, paragraphs b) and e);

c) the specific discipline applicable to relations between authorised persons and professional customers;

d) standards of conduct which shall not apply between authorised persons providing services pursuant to Article 1, subsection 5, paragraphs a), b) and e), and qualified counterparties, intended as:

1) investment companies, banks, insurance companies UCIs, managers, pension funds, financial brokers registered on the lists contemplated by articles 106 and 113 of the Consolidated Banking Law, the companies referred to in article 18 of the Consolidated Banking Law, the electronic money institutes, banking foundations, national governments and their corresponding offices, including the public bodies appointed to management of the public debt, central banks and supra-national organisations of a public nature;

2) companies whose main activity consists in trading commodities on own account and derivatives on commodities:

3) companies whose exclusive activity consists of trading on their own behalf on the derivative financial instrument markets and, merely for hedging purposes, on the spot markets, providing they are guaranteed by members who adhere to the central counterparties of said markets, when the responsibility for the settlement of the contracts stipulated by said companies falls under the competence of members who adhere to the central counterparties of said markets;

4) other categories of private persons identified by regulation by Consob, after consulting the Bank of Italy, with respect to criteria pursuant to directive 2004/39/EC and related execution measures;

5) categories corresponding to those of previous paragraphs for persons in non-EU countries119.

2-quinquies. By regulation and after consulting the Bank of Italy, Consob shall identify private professional customers, together with the criteria to identify private persons who on request may be treated as professional customers, and related request procedures120.

2-sexies. By regulation and after consulting the Bank of Italy and Consob, the Minister of the Economy and Finance shall identify public professional customers, and criteria to identify public persons who on request may be treated as professional customers, and related request procedures121.

2-septies. The provisions on remuneration and incentive systems issued pursuant to subsection 2bis, letter a), may provide that certain decisions regarding remuneration and incentives are referred to the competence of the shareholders' meeting, even in the dualistic administration and control model, establishing quorums in derogation of laws122.

2-octies. Any agreement or provision not in conformity with the provisions on remuneration and incentive systems issued pursuant to subsection 2bis, letter a), or contained in directly applicable acts of the European Union, is void. The invalidity of the clause does not lead to the nullity of the contract. Where possible, the provisions contained in the voided clauses are replaced by law with the parameters indicated in the above provisions in the values closest to the agreement123.

2-novies. The shareholders and directors of qualified subjects, without prejudice to the obligations under Article 2391, first subsection, of the Italian Civil Code, shall refrain from deliberations in which they have a conflicting interest, on their own behalf or that of third parties124.

Article 7
Supervisory powers

1. The Bank of Italy and Consob, within the scope of their respective authority, may take the following actions with respect to authorised intermediaries:

a) convene the directors, auditors and staff125;

b) order the convening of the governing bodies and set the agenda for the meeting;

c) proceed directly to convene the governing bodies where the competent bodies have not complied with an order issued under paragraph b);

1-bis. The Bank of Italy and Consob, within their respective competences, may also convene the directors, auditors and staff of those to whom the qualified subjects have outsourced essential or important business functions126.

2. For stability purposes, the Bank of Italy can issue special provisions concerning the matters governed by Article 6, subsection 1, letter a) and, where the situation so requires: adopt, after consulting Consob, restrictive or limiting measures concerning services, activities, operations and territorial structure; prohibit the distribution of profits or other elements of capital; with reference to financial instruments that can be calculated in capital for supervisory purposes and prohibit the payment of interest; set limits on the total amount of the variable part of remuneration in qualified subjects, when it is necessary for the maintenance of a sound capital base. The measures may be issued in respect of one or more qualified subjects, as well as one or more categories of them127.

2-bis. The Bank of Italy may order the removal of one or more corporate representatives of SIMs, asset management companies, SICAVs and SICAFs, if their tenure is of detriment to the sound and prudent management of the qualified subject; removal is not ordered when there are justified grounds for declaring disqualification pursuant to Article 13, unless there is an urgent need to take action128.

3. In the public interest or in the interest of participants, the Bank of Italy and Consob, within the scope of their respective authority, may order the suspension or temporary limitation of the issue or redemption of units or shares of collective investment undertakings.

Article 7-bis
Capital reserves

1. The Bank of Italy shall adopt the measures on capital reserves required by Chapter IV of Title VII of Directive 2013/36/EU, as well as those of a macro-prudential nature provided for in EU Regulation no. 575/2013, as the designated authority under these EU regulations in relation to SIMs and branches of non-European Community investment companies129.

Article 8
Reporting requirements

1. The Bank of Italy and Consob, to the extent of their duties, may require authorised intermediaries to communicate data and information and to transmit documents and records in the manner and within the time limits they establish. The Bank of Italy and Consob, within their respective competences, may request information from the staff of qualified subjects, including by means of the latter130.

1-bis. The UCITS which invest in credits participate in the Bank of Italy's Central Risks Bureau, as established by the Bank of Italy. The Bank of Italy may contemplate participation in the Central Risks Bureau through the banks and intermediaries registered on the list referred to under Article 106131.

1-ter. The obligations imposed by subsection 1 shall also apply to those to whom the qualified subjects have outsourced and essential or important business functions and to their staff132.

2. The powers envisaged in subsection 1 may also be exercised against the independent statutory auditor133.

3. The board of auditors shall inform the Bank of Italy and Consob without delay of any act or fact it comes to know of in the performance of its duties that may constitute a management irregularity or a violation of the provisions governing the activity of Italian investment companies, asset management companies, of SICAVs or SICAFs. To this end the Articles of Association of Italian investment companies, asset management companies, the SICAVs or the SICAFs, independently of the system of management and control adopted, shall assign the related tasks and powers to the control body.134.

4. The independent statutory auditors of Italian investment companies, asset management companies, of the SICAVs or of the SICAFs shall notify the Bank of Italy and Consob without delay of the acts or facts found in the performance of the engagement that may constitute a serious violation of the provisions governing the activity of the audited companies, jeopardize the continued existence of the undertaking or result in an adverse opinion or a qualified opinion on the annual accounts or interim statements of collective investment undertakings or a disclaimer135.

5. Subsection 3, first sentence, and subsection 4 shall also apply to the control body and independent statutory auditors of the companies that control or are controlled by Italian investment companies, asset management companies, the SICAVs or the SICAFs pursuant to Article 23 of the Consolidated Law on Banking136.

5-bis. Consob, to the extent of its duties, may exercise the powers pursuant to Article 187-octies upon authorised persons. The Bank of Italy, to the extent of its duties, may exercise the powers pursuant to Article 187-octies, subsection 3, paragraph c) upon authorised persons137.

6. Subsections 3, 4, 5, and 5-bis shall apply to banks, limited to the provision of investment services and activities138.

Article 8-bis
Internal systems for reporting violations

1. Qualified subjects and the related parent company shall adopt specific procedures for the internal reporting by staff of acts or facts that may constitute a violation of the rules governing the activity carried out.

2. The procedures required by subsection 1 are suitable to:

a) ensure the confidentiality of the personal data of the informant and the alleged infringer, without prejudice to the rules governing investigations or proceedings initiated by the judicial authorities in relation to the facts reported;

b) adequately protect the informant against retaliatory, discriminatory or otherwise unfair conduct consequent to the report;

c) provide a specific, independent and autonomous channel for the report.

3. The submission of a report does not in itself constitute a violation of obligations arising from the employment relationship.

4. Article 7, subsection 2, of Italian Legislative Decree no. 196 of 30 June 2003, does not apply with respect to the identity of the informant, which can only be revealed with his consent or when this knowledge is essential to the defence of the accused.

5. The Bank of Italy and Consob shall issue the implementing provisions of this Article by a joint regulation139.

Article 8-ter
Reporting violations to the Bank of Italy and Consob

1. The Bank of Italy and Consob receive, each for the matters within their competence, from the staff of qualified subjects and their related parent company, reports that refer to violations relating to the rules in Part II, Title I, II and III of this Legislative Decree, as well as European Union acts directly applicable to the same matters.

2. The Bank of Italy and Consob shall take into account the criteria of Article 8-bis, subsection 2, letters a) and b), and may lay down conditions, limits and procedures for receiving the reports.

3. The Bank of Italy and Consob shall make use of the information contained in the reports, when relevant, only in the exercise of supervisory functions and for the achievement of the purposes set out in Article 5.

4. In the case of access pursuant to Articles 22 and following of Law no. 241 of 7 August 1990, the document is shown in a manner that will safeguard the confidentiality of the informant. The provisions of Article 8-bis, subsections 3 and 4 shall apply140.

Article 9141
Statutory audit

1. For Italian investment companies, asset management companies, to the SICAVs and to the SICAFs, article 159 subsection 1 shall apply.

2. For asset management companies, the statutory auditor or the independent statutory auditor shall issue a special report expressing an opinion on the financial statements of the mutual fund142.

Article 10
Inspections

1. The Bank of Italy and Consob, to the extent of their duties, may carry out inspections of authorised intermediaries143 and require the exhibition of documents and the adoption of measures deemed necessary, in harmony with the provisions of Community law144.

1-bis. Consob may request that the independent statutory auditor performs audits. Related expenses, the fairness of which is evaluated by Consob, are borne by the person inspected145.

1-ter. The Bank of Italy and Consob may carry out inspections, require the display of documents and the completion of acts deemed necessary, even at those to whom the qualified subjects have outsourced essential or important business functions and their staff146.

2. Each authority shall notify the inspections it undertakes to the other, which may request it to carry out on the-spot verifications of matters within the scope of its authority.

3. The Bank of Italy and Consob may request the competent authorities of another EU country to carry out on-the spot verifications of branches of Italian investment companies, asset management companies and banks established within the territory of such state or agree on other methods of verification.147

4. The competent authorities of another EU country, after notifying the Bank of Italy and Consob, may, directly or by way of persons engaged by them, inspect the branches established in Italy of EU investment companies, banks and

of EU management companies and of EU AIFMs which they have authorised. Where the competent authorities of another EU country so request, the Bank of Italy and Consob, within the scope of their respective authority, may carry out on-the-spot verifications directly or agree on other methods of verification.148

5. The Bank of Italy and Consob, to the extent of their duties, may conclude agreements with the competent authorities of non-EU countries on procedures for the inspection of branches of investment companies and banks established in their respective territories149.

Article 11
Composition of groups

1. The Bank of Italy, after consulting Consob:

a) shall determine the notion of group relevant for the purpose of verifying the requirements provided for in Articles l9(1)(h) and 34(1)(f)150;

a-bis) indicates the provisions of Chapter II of this Title applicable to companies which control an investment company or an asset management company, as indicated by letter b);

b) may issue rules for identifying the set of persons to be subjected to group supervision from among those providing investment services and collective portfolio management services as well as related and instrumental activities or other financial activities, as defined in Article 59(1)(b) and letter b-bis), of the Consolidated Law on Banking. Such persons shall be identified from among those not subject to consolidated supervision under the Consolidated Law on Banking that:

1) are directly or indirectly controlled by an Italian investment company or asset management company;

2) directly or indirectly control an Italian investment company or asset management company151;

1-bis. The group identified pursuant to subsection 1, paragraph b), is registered in a special register held by the Bank of Italy. The parent company shall immediately inform the Bank of Italy of the existence of the group and its updated composition. A copy of the aforementioned notification is forwarded by the Bank of Italy to Consob152.

Article 12
Supervision of groups

1. The Bank of Italy may issue rules to the Italian investment company or asset management company or financial company heading the group identified in accordance with Article 11(1)(b) referring to all the persons identified under the same article and regarding the matters referred to in Article 6(1)(a), 1-bis and 2-bis, paragraphs a), b), c) and g). Where reasons of stability require, the Bank of Italy may issue specific rules regarding the same matters153.

1-bis. In line with EU regulations, the Bank of Italy shall identify options for exemption from the application of provisions adopted pursuant to subsection 1154.

2. The Italian investment company or asset management company or financial company that is the group's parent undertaking, in performing its activity of direction and coordination, shall issue rules to the components of the group identified in accordance with Article 11(1)(b) for carrying out instructions issued by the Bank of Italy. The directors of the companies belonging to the group shall supply all the data and information needed for the issue of such rules and shall cooperate in complying with the provisions on consolidated supervision155.

3. The Bank of Italy and Consob, within the scope of their respective authority, may require persons identified in accordance with Article 11(1)(b) to transmit reports, data and any other relevant information on a periodic or other basis. Information needed to carry out supervision may also be required of persons that, while not engaging in investment services, collective portfolio management services, related and instrumental activities or other financial activities, are linked to the Italian investment company or asset management company by the shareholding relationships specified in Article 11(1)(b)156.

3-bis. In the exercise of supervisory activities on a consolidated basis, the Bank of Italy may issue provisions, pursuant to this Article, with regard to all persons included in the group identified pursuant to Article 11, subsection 1, paragraph b)157.

4. ...omissis...158

5. The Bank of Italy and Consob, to the extent of their duties, may:

a) carry out inspections of persons identified under Article 11(1)

b) exclusively for the purpose of verifying the exactness of the data and information provided, carry out inspections of persons that, while not engaging in investment services, collective portfolio management services, related and instrumental activities or other financial activities, are linked to the Italian investment company or asset management company by the shareholding relationships specified in Article 11(1)(b);

b-bis) carry out inspections at subjects to whom essential or important business functions have been outsourced by the subjects listed in letters a) and b), limited to the purposes referred to therein159.

5-bis. In the exercise of supervisory activities on a consolidated basis, the Bank of Italy may issue provisions, pursuant to article 7, subsection 2 with regard to persons pursuant to Article 11, subsection 1, paragraph b)160.

5-ter. The Bank of Italy may, if their tenure in office is of detriment to the sound and prudent management of the group, order the removal of one or more corporate representatives of the parent company; removal is not ordered when there are justified grounds for declaring disqualification pursuant to Article 13, unless there is an urgent need to take action161.

5-quater. The Bank of Italy and Consob, within their respective competences, may even request information from the staff of the qualified subjects listed in subsection 3, including by means of the latter162.

5-quinquies. The obligations imposed by subsections 2 and 3 shall also apply to those to whom the qualified subjects have outsourced and essential or important business functions and to their staff163.

5-sexies. Parent companies are subject to Articles 6, subsection 2-septies and 2-octies, and 7, subsections 1 and 1-bis164.

Chapter II
Corporate officers and shareholders

Article 13
Company representatives

1. Persons who perform administrative, managerial or control functions at SIMs, asset management companies, SICAVs and SICAFs must be suitable for the appointment.

2. For the purposes of subsection 1, representatives shall have the requirements of professionalism, integrity and independence, meet criteria of competence and fairness and devote the time necessary for the effective performance of their duties.

3. The Ministry of Economy and Finance, with a regulation adopted after consultation with the Bank of Italy and Consob, identifies:

a) consistent integrity requirements for all representatives;

b) requirements of professionalism and independence, graduated according to principles of proportionality;

c) responsibility criteria, consistent with the office to be filled and the characteristics of the qualified subject, and adequate composition of the body;

d) the criteria of fairness for representatives of SIMs, with regard, among other things, to the business relations of the representative, their conduct in relation to the supervisory authorities and sanctions or corrective measures issued by them and restrictive measures related to the professional activities carried, as well as any other element that may affect the fairness of the representative;

e) the limits on the number of offices for representatives of SIMs, graduated according to principles of proportionality and taking into account the size of the intermediary;

f) the grounds for the temporary suspension from office and its duration.

4. The regulation referred to in subsection 3 may define cases in which the requirements and criteria of suitability also apply to the heads of the main company functions in the subjects of greater importance referred to in subsection 1.

5. The administration and control bodies of the subjects referred to in subsection 1 shall assess the suitability of their members and the overall adequacy of the body, documenting the process of analysing and properly justifying the outcome of the assessment. In the event of specific and limited deficiencies related to the criteria established pursuant to subsection 3, letter c), the same bodies may take measures necessary to address them. In all other cases, the lack of suitability or a violation of the limits to the number of offices shall result in disqualification from the office; this is pronounced by the body of membership within thirty days of the appointment or knowledge of the supervening defect or violation. For persons who are not members of a body, the assessment and pronouncement of disqualification are made by the body that appointed them.

6. The Bank of Italy and Consob, within their respective competences, in the manner and time established by joint regulation, also in order to minimize the costs incurred by the qualified subjects: assess the suitability of the representatives and compliance with the limits to the number of offices, including on the basis of the analyses carried out and any measures taken pursuant to subsection 5; in the event of a defect or violation, they pronounce the disqualification from office165.

Article 14
(Shareholders)

1. The shareholders referred to in Article 15 shall have the requirements of integrity and meet criteria of competence and fairness so as to ensure the sound and prudent management of the investee company.

2. The Ministry of Economy and Finance, with a regulation adopted after consultation with the Bank of Italy and Consob, identifies:

a) the requirements of integrity;

b) the criteria of competence, graduated in relation to the influence on the management of the company that the shareholder can exercise;

c) the criteria of fairness, with regard, among other things, to the business relations of the shareholder, their conduct in relation to the supervisory authorities and sanctions or corrective measures issued by them and restrictive measures related to the professional activities carried, as well as any other element that may affect the fairness of the shareholder.

3. For the purposes of the application of this Article and Article 15, for SICAVs and SICAFs, reference is made only to nominative shares and the provisions referred to in subsection 2 lay down the cases in which, for the purpose of conferring the right to vote, such shares are regarded as bearer shares, with regard to the date of purchase.

4. For the purposes of subsections 1 and 2, shares held through subsidiaries, trust companies or third parties are also considered, as well as cases in which the rights arising from shares belong or are assigned to a person other than the owner of the holdings themselves or agreements exist concerning the exercise of voting rights.

5. Notwithstanding the provisions of Article 16, if the requirements and criteria set out in subsections 1 and 2 are not met, the voting rights and other rights that allow influencing the company, inherent in holdings exceeding the thresholds specified by Article 15, subsection 1, may not be exercised.

6. In case of non-compliance with the prohibition, the resolution or other measure adopted by the vote or, in any case, the contribution of the shareholdings referred to in subsection 1, may be challenged under the provisions of the Italian Civil Code. The shares for which the right to vote cannot be exercise are counted for the purposes of the regular constitution of the related shareholders' meeting.

7. The challenge may also be initiated by the Bank of Italy or Consob within one hundred and eighty days of the date of the resolution or, if this is subject to registration in the companies register, within one hundred eighty days of registration or, if it is subject only to filing at the companies register office, within one hundred and eighty days of the date of this.

8. Shareholdings exceeding the thresholds provided for in Article 15, subsection 1, of persons without the requirements of integrity must be sold within the deadline set by the Bank of Italy or Consob166.

Article 15
Acquisition and sale of shareholdings 167

1. Any person who for any reason intends to directly or indirectly acquire or dispose of a controlling investment or an investment that could have a significant influence in an Italian investment company, asset management company or SICAV or SICAFs, or an investment that assigns a share of voting rights or capital of at least 10 per cent, taking into account the shares or units already owned, must notify the Bank of Italy in advance. Advance notice must also be given for changes in investments when the share of voting rights or capital reaches or exceeds, upwards or downwards, 20 per cent, 30 per cent or 50 per cent, and in any event when changes result in the acquisition or loss of control of the company168.

2. Within the term established pursuant to subsection 5, letter, c), the Bank of Italy may prohibit the acquisition of the shareholding if it deems that conditions are not met to ensure a sound and prudent management of the intermediary, considering the quality of the potential buyer and the financial soundness of the proposed acquisition based on the following criteria: the reputation of the potential buyer in accordance with Article 14; the suitability, under Article 13, of those who, following the acquisition, will carry out administrative, management and control functions; the financial soundness of the potential buyer; the capacity of the intermediary to comply with provisions governing its activities following the acquisition; the suitability of the structure of the group of the potential buyer to allow effective supervision; the absence of reasonable suspicion that the acquisition is related to money laundering or terrorist financing. The Bank of Italy may establish a time limit for the acquisition as well as communicate, even before the expiration of the term, that it approves of the transaction169.

3. Acquisitions and disposals referred to in subsection 1 shall be notified upon completion to the Bank of Italy, Consob and the company170.

4. Holdings are considered to be acquired or disposed of indirectly where the acquisition or the disposal is effected through subsidiary companies, trust companies or nominees. Control shall exist in the cases defined in Article 23 of the Consolidated Law on Banking.

5. By a regulation, the Bank of Italy shall establish:

a) the calculation criteria for voting rights for application of the thresholds envisaged in subsection 1, including cases in which voting rights are not calculated for the purpose of that subsection, together with criteria to identify cases of significant influence;

b) the persons required to give notice where voting rights attached to holdings are exercisable by or attributed to a person other than the owner of the holdings and where agreements exist concerning the exercise of voting rights;

c) the notification procedures and time limits, and for completion of the assessment procedures envisaged in subsection 2171.

Article 16
Suspension of voting rights, obligation to dispose of shareholdings172

1. The voting and other rights making it possible to influence the company attached to the shareholdings exceeding the thresholds established under Article 15(5) may not be exercised where the notices referred to in Articles 15(1) and 15(3) have not been given, where the Bank of Italy has prohibited the acquisition or the time limit within which the Bank of Italy may prohibit the acquisition has not expired or where the time limit established under Article 15(2), if any, has expired.173

2. The Bank of Italy, acting on its own initiative or on a proposal from Consob, may suspend the voting and other rights making it possible to influence the company attached to a qualifying shareholding in an Italian investment company or asset management company or in a SICAV or in a SICAF where the influence exercised by the holder of such voting rights is likely to be prejudicial to the company's sound and prudent management or effective supervision.174

3. In the event of non-compliance with the prohibitions referred to in the preceding subsections, Articles 14(5) and 14(6) shall apply.

4. The Bank of Italy may fix a time limit for the disposal of shareholdings exceeding the limits established under Article 15(5) when the prior notice referred to in Article 15(1) has not been given or when, pursuant to Article 15(2), the Bank of Italy has prohibited an acquisition or any time limit it established for the acquisition has expired.175

Article 17176
Requests for information on shareholdings

1. The Bank of Italy and Consob, specifying the time limit for the response, may require:

a) Italian investment companies, asset management companies, to the SICAVs and to the SICAFs, to provide the names of the owners of shareholdings on the basis of the register of shareholders, notifications received or other information available to them177;

b) companies and entities of whatsoever nature which own shareholdings in the companies referred to in paragraph a) to provide the names of the owners of the shareholdings on the basis of the register of shareholders, notifications received or other information available to them;

c) the directors of companies and entities which own shareholdings in Italian investment companies or asset management companies or in the SICAVs and in the SICAFs to provide the names of their controllers;

d) trust companies which hold shareholdings in companies referred to in paragraph c) in their own names to provide the identification data of the beneficiaries.178

TITLE II
INVESTMENT SERVICES179

Chapter I
Persons and authorisation

Article 18
Persons

1. The provision of investment services

and activities to the public on a professional basis shall be reserved to investment companies and banks180.

2. Asset management companies may professionally practice towards the public the services contemplated by article 1, subsection 5, letters d) and f). Asset management companies may also professionally practise towards the public the service contemplated by article 1, subsection 5, letter e), if authorised to provide the AIF management service. EU management companies may professionally practise towards the public the services contemplated by article 1, subsection 5, letters d) and f), if authorised in the Home Member State181.

3. Financial intermediaries entered in the register referred to in Article 107 of the Consolidated Law on Banking may provide the services referred to in Article 1(5)(a) and (b) exclusively for derivative financial instruments, and in Article 1(5)(c) and (c-bis) to the public on a professional basis in the circumstances and subject to the conditions established by the Bank of Italy after consulting Consob.182

3-bis. The regulated stock exchange company may be authorised for the activity pursuant to Article 1, subsection 5, paragraph g)183.

4. Italian investment companies may provide non-core services and other financial activities as well as related and instrumental activities to the public on a professional basis. Reservations of such activities established by law shall be unaffected.

5. The Minister of the Economy and Finance,184 in a regulation adopted after consulting the Bank of Italy and Consob:

a) for the purpose of tracking the development of financial markets and the standards of adaptation of EU authorities, new categories of financial instruments, new investment services and activities and new accessory services, indicating which persons subject to certain forms of prudential supervision may exercise the new services and operations185 / 186;

b) shall adopt the rules implementing and integrating the reservations of activities provided for in this article, in compliance with the provisions of Community law187.

Article 18-bis188
(Independent financial advisors)189

1. The reservation of activities pursuant to Article 18 shall not prejudice the opportunity for natural persons in possession of the requirements of professionalism, integrity, independence and equity established by regulation adopted by the Minister of the Economy and Finance, after consulting the Bank of Italy and Consob, and entered on the register pursuant to subsection 2, to provide advisory services on investment matters, without holding sums of money or financial instruments pertaining to customers. The professionalism requirements for entry in the register shall be ascertained on the basis of strict evaluation criteria that take into account duly documented past professional experience or on the basis of evaluation tests190.

2. …omissis…191

3. …omissis…192

4. …omissis…193

5. …omissis…194

6. The [body] pursuant to subsection 2195:

a) subject to verification of the necessary requirements, shall arrange entry in the register of natural persons submitting due application to provide the services indicated in subsection 1, and arrange cancellation should such requirements be no longer met;

b) shall supervise compliance with the provisions of paragraphs c), d), e) and g) of subsection 7;

c) in cases of infringement of the rules of conduct pursuant to subsection 7, paragraph d), after consulting the interested party, shall in relation to the seriousness of the infringement and in compliance with the provisions of subsection 7, paragraph b), decide to issue of a written reprimand, order payment of a fine of between five hundred euro and twenty-five thousand euro, order a 1-4 month suspension from the register or order disqualification from the register;

d) shall take all other action necessary for the proper keeping of the register;

e) may request registered persons to communicate data and information, and forward documents and papers according to terms and conditions decided by the body;

f) may perform inspections of registered persons, or request sight of documents and completion of any papers deemed necessary, also through personal hearings.

7. By regulation, Consob shall determine the principles and criteria relating to:

a) setup of the register and related forms of advertising;

b) entry in the register, reasons for suspension, disqualification and readmission, and measures applying to persons registered;

c) grounds for incompatibility;

d) the rules of conduct to be followed by persons registered in their relations with customers, with due regard to the provisions to which licensed parties are subject;

e) the storage methods for documents concerning activities performed by persons registered;

f) the activities of the body, with specific reference to the duties referred to in subsection 6;

g) the professional training of persons.

8. Should an adverse decision be issued pursuant to subsection 6, paragraph c), the interested party may submit appeal to Consob within thirty days of the date of the related notice. The submission of an appeal and the related decision shall follow procedures determined by Consob by regulation pursuant to subsection 7.

9. Should Consob adopt an adverse decision pursuant to subsection 8, the interested party may file appeal before the Court of Appeal. Subsections 4, 5, 6, 7 and 8 of Article 195 shall apply.

10. Consob may request that the body communicate data and information, and forward documents and papers according to terms and conditions decided by Consob; Consob may perform inspections of the body, or request sight of documents and completion of any papers deemed necessary.

11. In the event of inactivity or malfunction of the body, Consob shall submit a justified proposal to the Ministry of the Economy and Finance for the adoption of suitable measures or, for more serious cases, to wind up the body and appoint a commissioner196.

Article 18-ter
Financial consulting companies

1. With effect from 1 October 2009, the reservation of activities pursuant to Article 18 shall not prejudice the opportunity for public limited companies or private limited companies in possession of the requirements of equity and independence established by regulation adopted by the Minister of the Economy and Finance, after consulting the Bank of Italy and Consob, to offer consultancy services on investment matters, without holding sums of money or financial instruments pertaining to customers.

2. After consulting the Bank of Italy and Consob, the Minister of the Economy and Finance may also require that the company officers be in possession of the requirements of professionalism, integrity and independence.

3. In the register pursuant to article 18-bis, subsection 2, a special section is dedicated to financial consulting companies for which subsections 3, 4, 5, 6, 7 and 8 of article 18-bis shall apply197.

Article 19
Authorisation

1. Consob, after consulting the Bank of Italy, shall authorise investment companies to provide investment services and activities, within six months from the presentation of the complete application, where the following conditions are satisfied198:

a) the legal form adopted is that of a società per azioni;

b) the name of the company contains the words "società di intermediazione mobiliare";

c) the registered office and the head office of the company are in Italy;

d) the paid-up capital is not less than that established on a general basis by the Bank of Italy199;

e) a programme relating to initial operations is submitted, together with the instrument of incorporation and articles of association, including an illustration of the types of operations envisaged, the procedures adopted and the type of accessory services intended for offer, together with a report on the organisational structure, including an illustration of any outsourcing to third parties of essential operating functions200;

f) the subjects that govern, manage and control the company are suitable under Article 13201;

g) the shareholders indicated in article 15, subsection 1, have the requirements and meet the criteria laid down by Article 14 and the disqualification conditions contemplated by Article 15, subsection 2, do not exist202;

h) the structure of the group of which the company is part is not prejudicial to the effective supervision of the company and at least the information required pursuant to Article 15(5) is provided.

2. Authorisation shall be refused where verification of the conditions indicated in subsection 1 shows that sound and prudent management is not ensured and the ability of the company to exercise investment services or activities correctly is ensured.203.

3. The Bank of Italy, after consulting Consob, shall regulate the authorisation procedure and the cases in which authorisation shall lapse where the Italian management company fails to start or interrupts the provision of services authorised.204

3-bis. Investment companies shall inform Consob and the Bank of Italy of any significant change, after authorisation, to the conditions pursuant to subsection 1205.

4. The Bank of Italy, after consulting Consob on activities pursuant to Article 1, subsection 5, paragraph g), shall authorise the provision of investment services and activities by banks authorised in Italy, as well as services and activities indicated in Article 18, subsection 3, by financial intermediaries registered in the list pursuant to Article 107 of the Consolidated Law on Banking206.

Article 20
Register

1. Consob shall enter Italian investment companies and non-EU investment companies in a special register. EU investment companies shall be entered in a special list annexed to the register207.

2. Consob shall communicate entries in the register to the Bank of Italy.

3. The persons referred to in subsection 1 shall indicate the details of the entry in the register or list in their documents and correspondence.

Chapter II
Performance of services208

Article 21
General criteria

1. In providing investment and non-core services and activities, authorised intermediaries must:

a) act diligently, fairly and transparently in the interests of customers and the integrity of the market.

b) acquire the necessary information from customers and operate in such a way that they are always adequately informed;

c) use publicity and promotional communications which are correct, clear and not misleading,

d) have resources and procedures, including internal control mechanisms, suitable for ensuring the efficient provision of services and activities209;

1-bis. In the provision of investment services and activities and accessory services, Italian investment companies, non-EU investment companies, asset management companies, harmonised asset management companies, financial intermediaries registered in the list pursuant to Article 107 of the Consolidated Law on Banking, Italian banks and non-EU banks:

a) shall adopt all reasonable measures to identify and manage conflict of interest which may arise with the customer or between customers, also by the adoption of appropriate organisational measures, in order to avoid a negative impact on the interests of the customer;

b) shall clearly inform customers, prior to acting on their behalf, of the general nature and/or sources of conflict of interest where measures taken pursuant to paragraph a) are not sufficient to ensure, with reasonable certainty, that the risk of damaging the interests of the customer is avoided;

c) shall perform independent, sound and prudent management and take measures to safeguard the rights of customers with regard to their assets210.

2. In performing services, investment companies, banks and asset management companies may, subject to their obtaining customers' consent in writing, act in their own names and on behalf of their customers.

Article 22
Separation of assets

1. In providing investment and non-core services, the financial instruments and funds of individual customers held in whatever capacity by an Italian investment company, asset management company,

EU management companies or financial intermediary entered in the register provided for in Article 107 of the Consolidated Law on Banking and the financial instruments of individual customers held in whatever capacity by a bank shall be separate assets for all intents and purposes from those of the intermediary and from those of other customers. Actions in respect of such assets may not be brought by creditors of the intermediary or on behalf of such creditors, nor by creditors of the depositary or the sub-depositary, if any, or on behalf of such creditors. Creditors of individual customers may bring actions up to the amount of the assets owned by such customers.211

2. Legal and court-ordered set-off shall not apply to accounts referring to financial instruments or funds deposited with third parties and agreements may not be made for their set-off against claims of the depositary or the sub-depositary on the intermediary or the depositary.

3. Unless customers have agreed in writing, an investment company, Italian asset management company,

EU management companies or financial intermediary entered in the register provided for in Article 107 of the Consolidated Law on Banking or a bank may not use, on its own behalf or on behalf of third parties, financial instruments belonging to customers which it holds in any capacity. Nor may an investment company, Italian asset management company,

EU management companies or financial intermediary entered in the register provided for in Article 107 of the Consolidated Law on Banking use, on its own behalf or on behalf of third parties, liquid balances belonging to customers which it holds in any capacity.212

Article 23
Contracts

1. Contracts for the provision of investment and non-core services, except for the service set forth in article 1, subsection 5, paragraph f), and, if foreseen, the provision of accessory services, shall be reduced to writing and a copy given to customers. Consob, after consulting the Bank of Italy, may issue a regulation establishing that, for justified technical reasons or in relation to the professional nature of the contracting parties, certain types of contract may or must be concluded in a different form. Failure to comply with the prescribed form shall render the contract null and void213.

2. Any clause which refers to usage for the determination of the fee payable by customers or any other amount charged to them shall be null. In such cases, nothing shall be payable.

3. In cases referred to in subsections 1 and 2, nullity may be enforced only by the customer.

4. Title IV, Chapter I, of the Consolidated Law on Banking, shall not apply to investment services

and activities, to the allocation of financial products as well as to transactions and services which are components of financial products subject to the regulations of Article 25-bis or of part lV, title II, chapter I. In any case, the pertinent provisions of title Vl of the Consolidated Law on Banking are applied to transactions regarding consumer credit. 214

5. Within the scope of the provision of investment services

and activities, Article 1933 of the Civil Code shall not apply to derivative financial instruments or to similar instruments specified pursuant to Article 18(5)(a)215.

6. In actions for damages in respect of injury caused to the customer in the performance of investment services or non-core services, the burden of proof of having acted with the due diligence required shall be on the authorised intermediaries.

Article 24
Management of investment portfolios216

1. The following regulations shall be applied to portfolio management:

a) the customer may issue binding instructions with regard to transactions to be performed;

b) the customer may withdraw from the contract at any time, without prejudice to the right of withdrawal by the investment company, asset management company or bank pursuant to Article 1727 of the Civil Code;

c) the power to exercise voting rights in relation to financial instruments under management may be conferred upon an investment company, bank or asset management company by means of proxy granted in writing for each shareholder’s meeting in observance of the limits and procedures established by regulation by the Minister of the Economy and Finance, after consulting the Bank of Italy and Consob217.

2. Agreements in conflict with the provisions of this article shall be null and void, nullity may be enforced only by the customer.

Article 25
Trading on regulated markets

1. Investment companies and Italian banks authorised to provide the services of dealing for own account and execution of orders for clients may operate in Italian regulated markets, in EU markets and in non-EU markets recognized by Consob pursuant to Article 67. EU and non-EU investment companies and EU and non-EU banks authorised to provide such services and activities may operate in Italian regulated markets.

2. Persons other than those as indicated in subsection 1 of this Article may access regulated markets, taking into account the regulations adopted by the management company pursuant to Article 62, subsection 2, under the following terms:

a) they satisfy the requirements of integrity and professionalism;

b) they have a sufficient level of trading experience and capacity;

c) they have adequate organisational strategies;

d) they have sufficient resources for the role to be performed.

3. Persons pursuant to subsection 2, permitted to trade on regulated markets, shall adopt conduct using due diligence, correctness and transparency in order to ensure market integrity218.

Article 25-bis 219
Financial products issued by banks and insurance companies

1. Articles 21 and 23 shall apply to the subscription and placement of financial products issued by banks and by insurance companies. 220

2. In relation to products referred to in subsection 1 and for the purposes referred to in Article 5(3), Consob shall exercise the regulatory powers and the powers regarding reporting requirements and inspections referred to in Article 6 subsections 2 and 2-bis, paragraphs d), e), i), j), l), m) and n), as well as the powers referred to in Article 7(1)221.

3. The board of auditors, the supervisory board or the management control committee of insurance companies shall promptly inform Consob of any act or fact it comes to know of in the performance of its duties that may constitute a violation of the rules referred to in this chapter or of general or specific rules laid down by Consob under subsection 2.

4. The independent statutory auditors of insurance companies shall promptly notify Consob of acts or facts they find in the performance of the engagement that may constitute a serious violation of the rules referred to in this chapter or of general or specific rules laid down by Consob under subsection 2222.

5. Subsections 3 and 4 shall also apply to the internal control bodies of companies and the independent statutory auditors of companies that control insurance companies or are controlled by insurance companies as defined in Article 2359 of the Civil Code223.

6. IVASS and Consob shall inform each other of the inspections they conduct at insurance companies. Each authority may ask the other to make checks on matters for which it is competent224.

Chapter III
Cross-border operations

Article 26
Branches of Italian investment companies and freedom to provide services

1. Italian investment companies may operate:

a) in another EU country, also without establishing branches there, in compliance with the regulation referred to in subsection 2;

b) in a non-EU country, also without establishing branches there, subject to authorisation by the Bank of Italy.

2. The Bank of Italy, after consulting Consob, shall lay down in a regulation:

a) the rules implementing the Community provisions concerning the conditions and procedures to be complied with for Italian investment companies to provide services subject to mutual recognition in other EU countries by establishing branches or under the freedom to provide services;

b) the conditions and procedures for granting authorisation to Italian investment companies to provide services not subject to mutual recognition in other EU countries and services in non-EU countries225.

3. The existence of cooperation agreements between the Bank of Italy and Consob and the competent authorities of the host country and the opinion of Consob shall in all cases be conditions for the granting of authorisation.

Article 27
EU investment companies

1. For the purpose of providing services subject to mutual recognition, EU investment companies may establish branches in Italy. The establishment of the first branch shall be subject to prior notification to Consob by the competent authority of the home country; the branch shall commence business two months after the notification226.

2. EU investment companies may provide services subject to mutual recognition in Italy without establishing branches there provided Consob has been informed by the competent authority of the home country227.

3. Consob, after consulting the Bank of Italy, shall lay down in a regulation the conditions and procedures to be complied with for EU investment companies to provide services subject to mutual recognition in Italy, including those procedures regarding possible requests for Consob to amend the provisions regarding the branches to be established in Italy.228

4. Consob, after consulting the Bank of Italy, shall by regulation establish rules for the authorisation of any activities performed by EU investment companies that are not subject to mutual recognition in Italy229.

Article 28
Non-EU investment companies

1. The establishment in Italy of the first branch of a non-EU investment company shall be authorised by Consob after consulting the Bank of Italy. The authorisation shall be subject to:

a) satisfaction by the branch of requirements corresponding to those provided for by Articles l9(1)(d), l9(1)(e) and 19(1)(f);

b) authorisation and actual provision in the home country of the investment services and activities. and non-core services which the non-EU investment company intends to provide in Italy230;

c) the existence in the home country of provisions concerning authorisation, organisational arrangements and supervision equivalent to those applying to Italian investment companies in Italy;

d) the existence of cooperation agreements between the Bank of Italy and Consob and the competent authorities of the home country;

e) the fulfilment of conditions of reciprocity in the home country within the limits permitted by international agreements.

2. Consob, after consulting the Bank of Italy, shall authorise non-EU investment companies to provide investment and non-core services and activities without establishing branches, provided the conditions referred to in subsection 1, paragraphs b)-e), are fulfilled and a programme of the activities to be carried on in Italy is submitted231.

3. Consob, after consulting the Bank of Italy, may adopt general rules specifying the services and activities non-EU investment companies may not provide in Italy without establishing branches.232

Article 29
Banks

1. Title II, Chapter II, of the Consolidated Law on Banking shall apply to the provision of investment and non-core services and activities in foreign countries by Italian banks and to the provision such services in Italy by foreign banks233.

Chapter IV
Door-to-door selling

Article 30
Door-to-door selling

1. Door-to-door selling shall mean the promotion and placement with the public of:

a) financial instruments in a place other than the registered office or the establishments of the issuer, the offeror or the person appointed to carry out the promotion or placement;

b) investment services and activities in a place other than the registered office or the establishments of the provider, promoter or seller of the service234.

2. The following are not considered door-to-door selling:

a) an offer to professional customers, as identified by article 6, subsections 2-quinquies and 2-sexies;

b) an offer of an issuer's own financial instruments addressed to the members of the board of directors or of the supervisory board, to employees, and to collaborators who are not employees of the issuer, of the holding company or of its subsidiaries, made in the respective offices or branches235.

3. Door-to-door selling of financial instruments may be carried on by:

a) persons authorised to perform the service referred to in Article 1 subsection 5, paragraphs c) and c-bis) 236;

b) by asset management companies, EU management companies, SICAVs, SICAFs, EU and non-EU AIFMs, exclusively for UCI units or shares237.

4. Investment companies, banks, financial intermediaries entered in the special register provided for in Article 107 of the Consolidated Law on Banking, asset management companies and EU management companies and EU and non-EU AIFMs may engage in door-to-door selling of their own investment services and activities. Where such selling involves services and activities provided by other intermediaries, investment companies and banks must be authorised to perform the services referred to in Article l(5)(c) or (c-bis).238

5. Investment companies and banks may engage in door-to-door selling of products, other than financial instruments and investment services and activities, the characteristics of which shall be established in a regulation issued by Consob after consulting the Bank of Italy.239

6. The enforceability of contracts for the placement of financial instruments or the management of individual portfolios concluded outside the registered office or sold using distance marketing techniques pursuant to Article 32 shall be suspended for a period of seven days beginning on the date of subscription by the investor. Within that period the investor may notify his withdrawal from the contract at no expense and without any compensation for the financial advisors authorised to make off-premises offers. This possibility shall be mentioned in the forms given to the investor.

Without prejudice to the application of the discipline of the first and second sentence to the investment services referred to in article 1, section 5, letters c), c-bis) and d), for contracts undersigned as from 1 September 2013, the same discipline also applies to the investment services referred to in article 1, section 5, letter a). The same rules shall apply to contract proposals effected outside the registered office or using distance marketing techniques pursuant to Article 32240.

7. Failure to indicate the right of withdrawal in forms shall result in the nullity of the related contracts, which may be enforced only by the customer.

8. Subsection 6 shall not apply to public offerings of shares with voting rights or other financial instruments permitting such shares to be acquired or subscribed for, provided the shares or financial instruments are traded in regulated markets in Italy or other EU countries.

9. This article shall also apply to financial products different from financial instruments and, restricted to authorised persons, to financial products issued by insurance companies. 241

Article 31
(financial advisors authorised to make off-premises offers)242

1. For out-of-office offers, investment companies, asset management companies, EU management companies, SICAVs, SICAFs, EU and non-EU AIFMs, financial brokers registered on the list contemplated by article 106 of the Consolidated Banking Law and banks can take avail of financial advisors authorised to make off-premises offers. The financial advisors authorised to make off-premises offers of which Community and non-Community investment companies, EU management companies, EU and non-EU AIFMs, Community and non-Community banks are considered, for the purposes of the application of the rules of conduct, as branches established in the Italian Republic243.

2. A financial advisors authorised to make off-premises offers is the natural person who, as associate agent pursuant to Directive 2004/39/EC, professionally exercises door-to-door selling as an employee, agent or representative. Financial advisor authorised to make off-premises offers activities shall be performed exclusively in the interests of one person244.

3. The authorised person conferring the appointment shall be jointly and severally liable for losses caused to third parties by financial advisors authorised to make off-premises offers, including cases where such losses are the consequence of a criminal offence resulting in conviction.245

4. The sole register of financial advisors has been set up. A body246 composed of members of professional associations representing the financial salesmen and licensed persons has been established to keep said register. The body is legally established in the form of an association, with organisational and statutory independence, in compliance with the principle of territorial division of departments and activities. Within the scope of its financial independence, the body shall determine and collect fees and other sums payable by members, by registration applicants and by persons wishing to sit the evaluation test pursuant to subsection 5, by the amount necessary to guarantee continued performance of its duties. The order issued by the body to claim payment of such fees shall be deemed executive. On expiry of the payment deadline, the body shall levy sums due on the basis of regulations for the official collection of national taxes, and amounts due to local, public and welfare authorities. The body shall arrange entry in the register, subject to verification of possession of the necessary requirements, or cancellation from the register in any case contemplated by Consob in the Regulation indicated in subsection 6, paragraph a), and shall take all other action necessary for the proper keeping of the register. The body shall operate in compliance with the provisions and criteria of Consob regulations and under Consob’s supervision247.

5. The Minister of the Economy and Finance248 shall establish the integrity and experience requirements for entry in the register referred to in subsection 4 in a regulation adopted after consulting Consob. The experience requirements for entry in the register shall be verified on the basis of rigorous evaluation criteria that take account of validly documented previous professional experience or on the basis of examinations.249

6. Consob shall lay down in a regulation the principles and rules concerning:

a) the setting up of the register provided for in subsection 4 and the related forms of publicity;

b) the representative requirements for the professional associations of financial advisors authorised to make off-premises offers and authorised intermediaries;

c) entry in the register provided for in subsection 4 and the grounds for suspension, striking off and readmission;

d) the grounds for incompatibility;

e) the precautionary measures and sanctions governed respectively by Articles 55 and 196 and the violations to which the sanctions provided for in Article 196(1) shall apply;

f) the examination by Consob itself of complaints against the decisions of the body referred to in subsection 4 regarding matters referred to in paragraph c);

g) the rules of presentation and conduct which financial advisors authorised to make off-premises offers must comply with in their dealings with customers;

h) the arrangements for retaining the documentation regarding the activity performed by financial advisors authorised to make off-premises offers;

i) the activity of the body referred to in subsection 4 and the manner of performing supervision by Consob itself;

l) arrangements for the professional updating of financial advisors authorised to make off-premises offers.250

7. [Consob]251 may require financial advisors authorised to make off-premises offers and the persons who use financial advisors authorised to make off-premises offers to communicate data and information and to transmit documents and records and establish the related time limits. It may also carry out inspections and require the exhibition of documents and the adoption of measures it deems necessary252.

Article 32
Distance marketing of investment services and activities and financial instrument253

1. Distance marketing techniques shall mean techniques of contacting customers, other than advertising, which do not involve the simultaneous physical presence of the customer and the offeror or a person appointed by the offeror.

2. Consob, after consulting the Bank of Italy, may issue a regulation, in conformity with the principles established in Article 30 and in Legislative Decree no. 190 of 19th August 2005, on the distance marketing of investment services and activities and financial products. 254

Chapter IV-bis 255
Protection of investors

Article 32-bis
Protection of investors’ collective undertakings

1. Consumer associations entered on the list pursuant to Article 137 of Legislative Decree no. 206 of 6 September 2005 shall be entitled to protect investors’ collective undertakings, relating to the provision of investment services and activities, accessory services and collective asset management services, in the forms pursuant to Article 139 and 140 of the aforementioned Legislative Decree.

Article 32-ter
Out-of-court settlement of disputes

1. For the purposes of out-of-court settlements of disputes between investors and authorised persons and relating to the provision of investment services and activities, accessory services and collective asset management services, the procedures for conciliation and arbitration defined pursuant to Article 27, Law no. 262 of 28th December 2005 shall apply. Until such procedures are established, Article 41 of Legislative Decree no. 206 of 6th September 2005 shall apply.

TITLE III
COLLECTIVE PORTFOLIO MANAGEMENT

Chapter I256
Authorised subjects and contemplated businesses

Article 32-quater
Reserve assets

1. The professional practice of collective asset management is reserved to the asset management companies, the SICAVs, the SICAFs, the EU management companies which manage Italian UCITS, the EU and non-EU AIFMs which manage an Italian AIF, according to the provisions of this title.

2. The provisions of this title do not apply:

a) to the supranational institutions, such as the European Central Bank, the European Investment Bank, the European Investment Fund, the European Development Financial Institutions and bilateral development banks, the World Bank, the International Monetary Fund, and the other supranational institutions and similar international organisations, when such institutions or organisations manage AIFs for purposes of public interest;

b) to the national central banks;

c) to the States, the local public bodies and the other bodies which manage funds for the financing of social security and pension systems;

d) to holding companies, understood as companies which hold interests in one or more companies, with the purpose of executing entrepreneurial strategies to contribute to the increase of value in the long term, through the exercise of control, considerable influence and the rights deriving from their holdings and which:

1) operate on their own behalf and whose shares are traded on a regulated European Union market; or

2) are not established with the main purpose of generating profit for their own investors by the disposal of their holdings in the companies they control or over which they have considerable influence or in which they hold interests, as proven by their financial statements and other company documents;

e) to employee participation systems or employee savings systems;

f) to credit securitisation companies;

g) to the pension forms contemplated by Italian Legislative Decree no. 252 of 5 December 2005.

3. The Bank of Italy, after consulting Consob, adopts by its own regulations the enactment provisions of this article, in compliance with the European Union provisions.

Article 33
Contemplated businesses

1. Asset management companies manage the equity and risks of the UCIs and they provide for the administration and marketing of the UCIs which they manage.

2. Asset management companies also:

a) provide the portfolio management service;

b) set up and manage pension funds;

c) perform connected or instrumental activities;

d) provide services complementary to those of article 1, subsection 6, letter a), exclusively for the units of the UCIs managed;

e) provide investment advisory services;

f) market units and shares of UCIs managed by third parties, in compliance with the rules of conduct established by Consob after consultation with the Bank of Italy;

g) provide the service of the reception and transmission of orders, if authorised to practice the AIF management service.

3. The SICAVs and the SICAFs provide the collective asset management service and the activities contemplated by subsection 1 relative to the capital collected by the offer of their own shares; they can also carry out connected and instrumental activities.

4. Asset management companies, SICAVs and SICAFs can delegate to third parties specific duties relative to the performance of the services referred to in this chapter. Delegation is by means which avoid the complete depletion of the company's activities and it is exercised in respect of the provisions on outsourcing contemplated in the implementation of article 6, subsection 2-bis, the asset management companies, the SICAVs and the SICAFs always remaining responsible towards the investors for the actions of the delegated subjects.

5. The Bank of Italy, after consulting Consob, dictates by its own regulations the enactment provisions of this article, in compliance with the European Union provisions.

Chapter I-bis257
Discipline of authorised subjects

Section I
Asset management companies

Article 34
Authorisation of Italian asset management companies

1. The Bank of Italy, after consulting Consob, authorises the asset management companies to provide the collective asset management service for both UCITS and AIFs, and to perform the portfolio service, the investment advisory service and the service of the reception and transmission of orders, when the following conditions are fulfilled258:

a) the legal form adopted is that of a società per azioni;

b) the registered office and the head office of the company are in Italy;

c) the paid-up capital is not less than that established on a general basis by the Bank of Italy;

d) the persons performing administrative, management and control functions are suitable under Article 13259;

e) the shareholders indicated in article 15, subsection 1, have the requirements and meet the criteria laid down by Article 14 and the disqualification conditions contemplated by Article 15, subsection 2, do not exist260;

f) the structure of the group of which the company is part is not prejudicial to the effective supervision of the company and at least the information required pursuant to Article 15(5) is provided;

g) a programme of initial operations and a description of the organisational structure have been submitted together with the instrument of incorporation and the Articles of Association;

h) the name of the company contains the words "società di gestione del risparmio".

2. Authorisation shall be denied where verification of the conditions indicated in subsection 1 shows that sound and prudent management is not ensured.

3. The Bank of Italy, after consulting Consob, shall regulate the authorisation procedure and the cases in which authorisation shall lapse where the Italian management company fails to start or interrupts the provision of services authorised.

4. The Bank of Italy, after consulting Consob, shall authorise the merger or division of Italian asset management companies.

Article 35
Register

1. The asset management companies are registered on a special list held by the Bank of Italy, separated into two sections for the management of UCITS and of AIFs. EU management companies and EU and non-EU AIFMs which have made the communication required by articles 41-bis, 41-ter and 41-quater, are listed in separate sections of a special list attached to the register.261

2. The Bank of Italy shall communicate entries in the register referred to in subsection 1 to Consob262.

3. The persons referred to in subsection 1 shall indicate the details of the entry in the register in their documents and correspondence.

Section II263
SICAVs and SICAFs

Article 35-bis
Constitution

1. The Bank of Italy, after consulting Consob, authorises the constitution of the SICAVs and SICAFs if the following conditions are fulfilled:

a) the company is a joint stock company which complies with the provisions of this chapter;

b) the registered office and the general management of the company are located in the Italian Republic;

c) the share capital amounts to at least that determined as a general rule by the Bank of Italy;

d) the subjects which carry out administrative, management and control functions are suitable under Article 13264;

e) the shareholders indicated in Article 15, subsection 1 , have the requirements and meet the criteria laid down by Article 14 and the disqualification conditions contemplated by Article 15, subsection 2, do not exist265;

f) for SICAVs, the articles of association contemplate, as the exclusive purpose, collective investment of the capital obtained by the offer of its own shares; for SICAFs, the articles of association contemplate, as the exclusive purpose, the collective investment of the capital obtained by the offer of its own shares and of the financial instruments of its equity holdings indicated in the said articles.

g) the structure of the group to which the company belongs is not such as to prejudice the effective supervision of the company and at least the information requested by article 15, subsection 5, is given;

h) together with the deed of constitution and the articles of association, a programme is also presented concerning the initial activity, as well as a report on the organisational structure.

2. After consulting Consob, the Bank of Italy, by regulation:

a) disciplines the authorisation procedure contemplated by subsection 1 and the cases of lapse of the same;

b) specifies the documentation that the founding shareholders must present together with the authorisation application and the content of the project of the deed of constitution and of the articles of association.

3. The Bank of Italy checks that the deed of constitution and articles of association project complies with the prescriptions of law and of regulations and, for SICAVs and SICAFs other than reserved AIFs, with the general criteria predetermined by the same.

4. The founding partners of the SICAVs or SICAFs proceed with the constitution of the company and make the deposits of the initial capital underwritten within thirty days from the issue of the authorisation. The initial capital must be entirely deposited.

5. The name of the SICAV must contain an indication that it is a variable capital joint stock investment company. The name of the SICAF must contain an indication that it is a fixed capital joint stock investment company. The name must appear on all the company's documents. Articles 2333, 2334, 2335 and 2336 of the Italian civil code do not apply to SICAVs or SICAFs; for SICAVs, conferment in nature is not allowed.

6. In the case of multi-segment SICAVs and SICAFs, each segment represents an independent capital separate to all effects from the other segments. The assets of a single SICAV can be divided into segments composed exclusively of AIFs or of UCITS.

Article 35-ter
Registers

1. SICAVs and SICAFs authorised in Italy are listed on special registers held by the Bank of Italy. The SICAV register is divided into two separate sections, according to whether the SICAV is in UCITS or AIF form.

2. The Bank of Italy communicates to Consob the registrations referred to in subsection 1.

3. The subjects contemplated by subsection 1 indicate their registration details in their deeds and correspondence.

Article 35-quater
SICAV capital and shares

1. The capital of the SICAV is always equal to the net equity held by the company, as determined pursuant to article 6, subsection 1, letter c), n.5).

2. Articles from 2438 to 2447-decies of the Italian civil code are not applicable to SICAVs.

3. The shares representing the SICAV capital must be entirely paid up and registered at the moment of their issue.

4. SICAV shares can be nominative or to bearer, as established by the articles of association. Shares to bearer attribute one vote only for each shareholder regardless of the number of such shares held.

5. The SICAV articles of association must indicate the method for determining the value of the shares and the issue and reimbursement prices, as well as the frequency at which they can be issued and reimbursed.

6. The SICAV articles of association must contemplate:

a) limits on the issue of nominative shares;

b) special restrictions on the transfer of nominative shares;

c) the existence of several investment segments for each of which a specific category of shares can be issued; in this case, the criteria for the division of the general expenses between the segments is also established;

d) the possibility of issuing fractions of shares, without prejudice to the fact that corporate rights and attributed and can be exercised only by those who hold at least one share, pursuant to the rulings of this chapter.

7. Articles 2346, subsection six, 2348, subsections two and three, 2349, 2350, subsections two and three, 2351, 2352, subsection three, 2353, 2354, subsection three, numbers 3) and 4), 2355-bis and 2356 of the Italian civil code are not applied to SICAVs.

8. A SICAV cannot issue bonds or savings shares, nor can it buy or hold treasury shares.

Article 35-quinquies
SICAF capital and shares

1. Articles from 2447-bis to 2447-decies of the Italian civil code are not applied to SICAFs.

2. SICAF shares can be nominative or to bearer, as established by the articles of association. Shares to bearer attribute one vote only for each shareholder regardless of the number of such shares held.

3. The SICAF articles of association must indicate the method for determining the value of the shares and of any participatory financial instruments issued.

4. The SICAF articles of association must contemplate:

a) limits on the issue of nominative shares;

b) special restrictions on the transfer of nominative shares;

c) the existence of several investment segments for each of which a specific category of shares can be issued; in this case, the criteria for the division of the general expenses between the segments is also established;

d) the possibility of issuing fractions of shares, without prejudice to the fact that corporate rights and attributed and can be exercised only by those who hold at least one share, pursuant to the rulings of this chapter.

e) in the case of reserved SICAFs and without prejudice to article 35-bis, subsection 4, the possibility of making payments for the shares underwritten in several instalments, subsequent to the shareholder's promise to make the payments requested by the SICAF on the basis of the investment needs.

5. Articles 2349, 2350, subsections two and three, 2353 of the Italian civil code are not applied to SICAFs. Article 2356 of the Italian civil code is not applied to SICAFs not reserved to professional investors or to the investor categories indicated by the regulation of article 39.

6. SICAFs cannot issue bonds.

Article 35-sexies
The SICAV shareholders' meeting

1. The SICAV ordinary and extraordinary shareholders' meeting on second convocation are regularly constituted and empowered to pass resolution regardless of the share capital represented at the meeting.

2. The vote can be expressed by correspondence if this is contemplated by the articles of association. In such a case, the convocation notice must contain the full resolution proposal. Votes expressed in such a way shall not be taken into consideration is the resolution subjected to the vote of the shareholders' meeting does not conform to that contained in the convocation notice, although the relative shares are counted for the purpose of the regular constitution of the extraordinary shareholders' meeting. By regulation of the Ministry of Economy and Finance, after consulting the Bank of Italy and Consob, the procedures for voting by correspondence are established.

3. The notice contemplated by article 2366, subsection two, of the Italian civil code is also published in the manner contemplated by the articles of association for the publication of the value of the company's equity and the unit value of the shares, the term indicated in the same article 2366, subsection two, is thirty days.

Article 35-septies
Amendments to articles of association

1. The Bank of Italy approves amendments to the articles of association of SICAVs and non-reserved SICAFs.

2. Resolutions involving amendments to the articles of association of SICAVs and non-reserved SICAFs cannot be registered pursuant to and by effect of article 2436 of the Italian civil code unless they have been approved according to the terms and procedures contemplated by subsection 1. The resolution is sent to the Bank of Italy within fifteen days from the date of the meeting; the deposit contemplated by article 2436 of the Italian civil code must be made within fifteen days from the date of receipt of the Bank of Italy's approval provision. "Article 2376 of the Italian Civil Code does not apply.

Article 35-octies
Winding up and voluntary liquidation

1. Article 2484, subsections one, numbers 4) and 5) of the Italian civil code is not applied to SICAVs. If the SICAV capital falls below the measure determined pursuant to article 35-bis, subsection 1, letter c), and remains so for a term of sixty days, the company shall be wound up. The term is suspended if a merger procedure is initiated with another SICAV or a SICAF.

2. For SICAVs and SICAFs, the deeds which must be publicised pursuant to article 2484, subsections three and four, of the Italian civil code, are also published by the methods contemplated by the articles of association for the publication of the company's equity value, and communicated to the Bank of Italy within ten days from entry on the companies register. The issue and reimbursement of shares are suspended, in the cases contemplated by article 2484, subsection one, number 6), of the Italian civil code, from the date of the adoption of the resolution, in the cases contemplated by article 2484 of the Italian civil code and, for SICAVs, in the cases contemplated by subsection 1 of this article, from the moment of the adoption of the board of directors' resolution of from the moment of the entry in the companies register, of the decree of the chairman of the court. The board of director's resolution is also transmitted to Consob within the same terms.

3. The appointment, revocation and replacement of the liquidators falls within the competence of the extraordinary shareholders' meeting. Article 2487 of the Italian civil code, except for subsection one, letter c), are article 97 of the Consolidated Banking Law are applied.

4. The disposal plan and the plan for dividing the proceeds are communicated in advance to the Bank of Italy. The liquidators liquidate the company's assets in compliance with the provisions laid down by the Bank of Italy.

5. The financial statement of the liquidation is submitted to the judgement of the subject appointed to provide for the certified audit of the accounts, and it is published in the daily newspapers indicated in the articles of association.

6. The custodian, on the liquidators' instructions, provides for the reimbursement of the shares in the percentage contemplated by the final liquidation statement.

7. For everything not contemplated by this article, the provisions of Book V, title V, chapter VIII, of the Italian civil code are applied to SICAVs and SICAFs as far as compatible.

Article 35-novies
Transformation

1. A SICAV in the form of a UCITS cannot be transformed into anything other than an Italian UCITS. A SICAV in the form of an AIF or a SICAF cannot be transformed into anything other than an Italian UCI.

Section III266
Common provisions and exceptions

Article 35-decies
Rules of conduct and voting rights

1. Asset management companies, SICAVs and SICAFs which manage their own assets:

a) must operate diligently, correctly and with transparency in the best interests of the UCIs managed, the relative investors and the integrity of the market;

b) they must be organised in a manner which reduces to a minimum the risk of conflicts of interests also between the assets management and, in the case of a conflict of interests, they must act in order to ensure, in any case, fair treatment of the UCIs managed;

c) they must adopt appropriate measures to safeguard the rights of the investors of the UCIs managed and they must have adequate resources and appropriate procedures to ensure the efficient performance of the services;

d) they must ensure equal treatment to all the investors of the same UCI in respect of the conditions established by Consob, after consultation with the Bank of Italy, in compliance with the law of the European Union. In the case of reserved AIFs, preferential treatment to one or more investors or investor categories is allowed in respect of Directive 2011/61/EU and the relative enactment provisions;

e) they must provide, in the investors' interests, for the exercise of the voting rights inherent to the financial instruments of the UCI managed, unless otherwise ruled by law.

Article 35-undecies
Exceptions for Italian AIFMs

1. For the purposes indicated by article 6, subsection 01, in the case of reserved Italian AIFs, if the total value of the assets managed does not exceed Euro 100 million, or Euro 500 million if the UCIs managed do not take avail of the financial lever and do not allow investors to exercise the reimbursement right for 5 years after the initial investment, the Bank of Italy and Consob, within the scope of their respective competence, may exempt the authorised managers from applying the enactment provisions of article 6, subsections 1, 2 and 2-bis.

Article 35-duodecies
Assessment of credit rating

1. In order to assess the credit rating of the assets in which the UCITSs invest, the managers use systems and procedures that do not envisage the exclusive or mechanical reliance on the assessments of the credit ratings agencies.

2. Considering the nature, scope and complexity of the assets of the UCITSs, the Bank of Italy and Consob, each insofar as they are competent, verify the suitability of the systems and procedures adopted by the managers in accordance with subsection 1 and assess whether or not, under the scope of the UCITS investment policies, references to credit ratings issued by the credit ratings agencies, are made in such a way as to reduce the exclusive or mechanical reliance on the same267.

Chapter II268
Italian UCIs

Section I
Mutual investment funds

Article 36
Mutual investment funds

1. The mutual investment fund is managed by the asset management company which has set up the fund or by the management company which has taken over the management, in compliance with law and regulations.

2. The mutual investment fund participation agreement is disciplined by the fund regulation. The Bank of Italy, after consulting Consob, determined the general criteria for the drafting of the regulations of funds other than reserved AIFs and the minimum contents of the same, in addition to what is contemplated by article 39.

3. An asset management company which has set up the fund or the management company which has taken over the management acts independently and in the fund investors' interests, assuming towards these latter the mandating party's obligations and responsibilities.

4. Each mutual investment fund or each segment of such a fund represents an independent capital, separate to all effects from that of the asset management company and from that of each investor, as well as from any other assets managed by the same company; with regard to the obligations undertaken on behalf of the fund, the asset management company answers only with the assets of that fund. Claims on such assets on the part of the creditors' of the asset management company or in the interests of the same, or on the part of the creditors of the custodian or sub-custodian or in the interests of the same are not admitted. Claims of creditors of a single investor are admitted only on the units held by said investor. Under no circumstances may the asset management company use the assets of the funds managed in its own interests or those of third parties.

5. The units in mutual funds are named or bearer, as established by the fund regulation. The Bank of Italy, after consulting Consob, can establish as a general rule the characteristics of certificates and the initial face value of the units, also in view of the need to ensure the portability of the units.

Article 37
Fund regulations

1. The regulations of each mutual investment fund define the features of the fund, discipline the functioning of the same, identify the manager and the custodian, define the division of tasks between such subjects, and regulates the relationships between such subjects and the fund investors.

2. More precisely, the regulations establish:

a) the name and the duration of the fund;

b) the procedures for participation in the fund, the terms and procedures for the issue of the certificates, for reimbursement of units and for the liquidation of the fund;

c) the bodies responsible for the investment choices and for the criteria for dividing the investments according to those choices;

d) the type of assets, financial instruments and other valuables in which the capital of the fund may be invested;

e) the criteria for the determination of the income and of the management results and any systems for the sharing and distribution of the same;

f) the expenses borne by the fund and those borne by the asset management company;

g) the measure or criteria for determining the commission due to the asset management company and the costs charged to investors;

h) the means for publishing the unit value;

i) whether the fund is a feeder fund.

3. Pursuant to the regulations of closed-ended funds other than reserved AIFs, general meetings of investors may be held only to decide on a change of manager. The meeting is called by the management company's board of directors, also at the request of investors representing at least 5 percent of the value of the units issued, and resolutions are approved with the favourable vote of the absolute majority of the units represented at the meeting. However, the quorum for resolution may not be less than 10 percent of the value of all the units issued.

4. The Bank of Italy approves the regulations of funds other than reserved AIFs, as well as relative amendments, assessing in particular the completeness of the same and the compatibility with the general criteria determined pursuant to articles 36 and 37.

5. The Bank of Italy indicates the cases in which, according to the object of the investment, the investor category and the fund functioning rules, the regulations and relative amendments are understood as approved in general. In other cases, the regulations are understood as approved when the Bank of Italy adopts no provision of non-approval within the term established in advance by the same.

Section II
SICAVs and SICAFs under outsourced management

Article 38
SICAVs and SICAFs which appoint an external manager

1. The Bank of Italy, after consultation with Consob, authorises the constitution of SICAVs and SICAFs which designate an external manager for their assets in the following cases:

a) the company is a joint stock company which complies with the provisions of this chapter;

b) the registered office and the general management of the company are located in the Italian Republic;

c) the share capital amounts to at least that determined as a general rule by the Bank of Italy;

d) the persons performing administrative, management and control functions are suitable under Article 13269;

e) the shareholders indicated in Article 15, subsection 1, have the requisites of integrity and meet the criteria laid down by Article 14 and the disqualification conditions contemplated by Article 15, subsection 2, do not exist270;

f) the articles of association contemplate:

1) for SICAVs, the exclusive purpose is collective investment of the capital obtained by the offer of its own shares to the public; for SICAFs, the exclusive purpose is the collective investment of the capital obtained by the offer to the public of its own shares and of the financial instruments of its equity holdings indicated in the said articles.

2) the entire assets are entrusted to the an external manager, and the designated company is identified;

g) the stipulation of an agreement between the manager, if other than an asset management company, and the custodian, which ensures this latter access to the information necessary for the performance of its duties, as contemplated by article 41-bis, subsection 2-bis.

2. Article 35-bis, subsection 3, 4, 5 and 6 are applied.

Section III
Common provisions

Article 39
Structure of Italian UCIs

1. The Ministry of Economy and Finance, with regulations adopted after consultation with the Bank of Italy and Consob, determines the general criteria which Italian UCIs must respect regarding:

a) the object of the investment;

b) the investor categories to which the offer of units and shares are destined.

c) whether the fund is open-ended or closed-ended, and the participation procedures, particularly the frequency of unit issue and reimbursement, and any minimum subscription amount and the procedures to be followed;

d) the minimum and maximum duration, if any;

e) the conditions and procedures for acquiring or conferring assets, both during and after the constitution of the fund271.

2. The regulations contemplated by subsection 1 also establish:

a) the non-professional investor categories to which the Italian reserved AIFs can be offered, according to the procedures contemplated by article 43;

b) the accounting registrations, the statement and the periodic prospectuses which the asset management company must draw up, in addition to those required of commercial enterprises, as well as the obligations to publish the statement and periodic prospectuses;

c) the cases in which the asset management company must request admission for the listing of the fund units on a regulated market;

d) the requisites and remuneration of the independent experts referred to in article 6, subsection 1, letter c), number 5).

Section IV
Master-feeder structures

Article 40
Authorisation and rules of operation of master-feeder structures

1. The Bank of Italy authorises the investment of the Italian feeder UCI in the master UCI in the following cases:

a) there are agreements between, respectively, the managers, the custodians and the certifying auditors or auditing firms of master UCIs and feeder UCIs, which allow access to the documents and information necessary for the performance of their respective duties;

b) the master UCI and the feeder UCI have the same manager and this latter adopts internal rules of conduct that ensure the same access to documents and information as per letter a);

c) the master UCI and the feeder UCI have the same characteristics as envisaged by the regulations contemplated by subsection 2.

2. After consultation with Consob, the Bank of Italy regulates:

a) the authorisation procedure for the investment of the feeder UCI in the master UCI and the information and documents to be presented with the authorisation request;

b) the content of agreements and internal rules of conduct pursuant to paragraph 1;

c) the specific requirements of master UCIs and feeder UCIs and the rules applicable to the same;

d) the specific rules applicable to feeder UCIs, in the event of liquidation, merger, spin-off, temporary suspension of re-purchase, redemption or subscription of the master UCI units and the rules applicable to the feeder UCI and the master UCI to coordinate timing for the calculation and publication of their net asset value;

e) disclosure obligations and the exchange of information and documents between the manager, the custodian and the certifying auditor or auditing firm, of the master UCI and the feeder UCI respectively, and between these subjects and the Bank of Italy, Consob and the competent authorities of the EU and non-EU master and feeder UCIs.

3. As far as compatible, the provisions of sections I, II, III and III-ter of this chapter to master and feeder UCIs.

4. EU master UCIs which do not offer their own units in Italy to subjects other than feeder UCIs, article 42, subsections 1, 2, 3 and 4 do not apply. EU and non-EU master AIFs are subject to the provisions of chapter II-ter.

5. Without prejudice to the provisions of article 9, the certifying auditor or certifying auditing firm appointed to audit the feeder UCI must specify in the audit report any irregularities pointed out in the audit report of the master UCIs and the impact of such irregularities on the feeder UCI. If the financial years of the master UCI and feeder UCI close on different dates, the certifying auditor or certifying auditing firm appointed to audit the master UCI must draw up a specific audit report at the closure of the financial year of the feeder UCI.

6. The Bank of Italy and Consob, in compliance with EU provisions, notify the feeder UCI manager or the competent authority of the harmonised EU feeder UCITS of the provisions taken, in the case of failure to comply with the provisions of this chapter, in respect of the subjects indicated in this article, and the information received pursuant to article 8, subsection 4, relative to the master UCI manager and the master UCI.

7. The provisions of this article do not apply to Italian reserved AIFs.

Section V
Merger and spin-off of asset investment bodies

Article 40-bis
UCI merger and spin-off

1. The Bank of Italy notifies Consob and authorises the merger or spin-off of Italian UCIs on the basis of the relative projects, of the certificates of conformity issued by the custodians of the funds involved and of the information communicated to the investors which must enable them to prepare a justified opinion of the impact of the merger on the investment. The Bank of Italy may indicate the cases, according to the characteristics of the UCIs concerned by the operation or the content of the information to the investors, in which authorisation for the UCI merger or spin-off is generally issued.

2. The asset management companies make a report available to fund investors and the Bank of Italy, drawn up by the custodian or by an officially recognised auditor or auditing firm, which certifies the correctness of the criteria adopted to measure the fund’s assets and liabilities, any monetary balance, the calculation method and the effective exchange ratio at the reference date of the said report.

3. As far as compatible, the articles contained in book V, title V, chapter X, sections II and III of the civil code are applied to SICAVs and SICAFs involved in merger or spin-off operations. The merger or spin-off project, drawn up according to the requirements of the Bank of Italy Regulation pursuant to subsection 4 and any general meeting resolutions amending the relative projects must be authorised in advance by the Bank of Italy. Without the authorisation referred to in subsection 1, such operations cannot be entered in the companies register.

4. After consultation with Consob, the Bank of Italy regulates:

a) the authorisation procedure and the relative conditions;

b) the date of effect of the operation and the criteria for the allocation of the relative costs;

c) the information to be given to the investors;

d) the forms for which mergers and spin-offs are admitted;

e) the object of the certificates of conformity and the report contemplated by subsections 1 and 2;

f) the rights of the investors.

5. The provisions of this article do not apply to Italian reserved AIFs.

Article 40-ter
Cross-border UCI merger

1. Mergers of EU UCITS and Italian UCITS and those which involve Italian UCITS whose units are marketed in another EU state pursuant to article 41, subsection 2, letter a) a), are subject not only to the provisions of article 40-bis but also to the provisions contained in this article.

2. If the UCITS resulting from the merger, or the incorporating UCITS is not Italian, the merger authorisation is issued by the Bank of Italy in accordance with the provisions of EU legislation.

3. If the UCITS resulting from the merger, or the incorporating UCITS is Italian, the Bank of Italy may request the said UCITS to amend its disclosure to investors in accordance with the provisions of EU legislation.

4. The Bank of Italy, after consulting Consob, defines by regulation the enactment provisions of this article, in compliance with EU provisions.

Chapter II-bis272
Management company cross-border operations

Article 41
Cross-border operations of asset management companies

1. Asset management companies can operate, also without having a stable organisation, in an EU or non-EU state, in conformity with the regulation contemplated by subsection 2.

2. The Bank of Italy, after consulting Consob, establishes by regulation the enactment rules of the EU provisions on the conditions and procedures which the asset management companies must respect for:

a) performing in EU States the activities for which they are authorised pursuant to Directive 2009/65/EC and the relative enactment provisions, including the institution of UCITS;

b) cross-border operations in EU and non-EU States, in conformity with the provisions of Directive 2011/61/EU and of the relative enactment provisions, without prejudice to those of chapter II-ter.

3. The Bank of Italy, in the regulation contemplated by subsection 2, also lays down the conditions and procedures on the basis of which the asset management companies are authorised by the Bank of Italy, in accordance with Consob, for cross-border operations in EU and non-EU States in the cases excluded from the application of Directives 2009/65/EC and 2011/61/EU. For asset management companies to operate in a non-EU state, appropriate collaboration agreements must exist with the competent authorities of the host State.

4. The provisions of this article also apply to SICAVs and SICAFs which manage their own assets.

Article 41-bis
EU management companies

1. For the practice of the activities for which they are authorised pursuant to European Union provisions, the EU management companies may establish branches in the Italian Republic. The first establishment must be preceded by a communication to the Bank of Italy and Consob on the part of the competent authorities of the Home State. The branch can start operations two months after the communication.

2. Without prejudice to the provisions of article 42, EU management companies may perform the activities for which they are authorised pursuant to EU provisions in the Italian Republic without establishing a branch, providing the Bank of Italy and Consob are informed by the competent authority of the Home State.

3. EU management companies which intend to manage an Italian UCITS must respect the provisions of chapter II, as well as the enactment provisions of article 6, subsection 1, letter c). The Bank of Italy approves the fund regulations pursuant article 37 or authorises the SICAV, providing:

a) the fund or the SICAV complies with the provisions of this subsection;

b) the EU management company is authorised to manage a UCITS in the Home State with similar characteristics to that approved;

c) the EU management company has stipulated an agreement with the custodian which ensures that the custodian has access to the information necessary for the performance of its duties.

4. Should the Bank of Italy intend to refuse fund regulation approval of SICAV authorisation referred to in subsection 3, it consults the competent authority of the Home State of the EU management company.

5. After consulting Consob, the Bank of Italy regulates the conditions and procedures with which the EU management companies must comply in order to carry out the activities mentioned under paragraphs 1, 2 and 3 in the Italian Republic by the establishment of branches or as the free provision of services, and the content of the agreement between the EU management company and the custodian envisaged by subsection 3, letter c).

6. EU management companies carrying out the activities contemplated by subsections 1 and 3 in the Italian Republic, by means of the establishment of branches, must comply with the rules of conduct established under article 35-decies. Article 8, subsection 1, is applicable to EU management companies.

Article 41-ter
EU AIFMs

1. Without prejudice to the provisions of chapter II-ter, EU AIFMs can perform the collective asset management for which they are authorised pursuant to the EU provisions in the Italian Republic as the free performance of services or by the establishment of branches, providing the Bank of Italy is notified by the competent authority of the Home State. The Bank of Italy immediately transmits copy of said communication to Consob.

2. EU AIFMs which intend to manage an Italian AIF must respect the provisions of chapter II, as well as the enactment provisions of article 6, subsection 1, letter c), and the following conditions:

a) they must be authorised in the Home State for the management of AIFs with the same characteristics as those they intend to set up and manage in Italy;

b) the must have stipulated an agreement with the custodian which ensures the latter access to the information necessary for the performance of its duties.

3. The Bank of Italy, after consultation with Consob, disciplines by regulation the content of the agreement between the management company and the custodian contemplated by subsection 2, letter b).

4. EU AIFMs which perform the activities contemplated by subsection 1 and chapter II-ter in the Italian Republic through the establishment of branches, must respect the rules of conduct contemplated by article 35-decies and the relative enactment provisions on the management of conflicts of interests adopted in implementation of article 6, subsection 2-bis, letter l). Article 8, subsection 1, is applicable to EU AIFMs.

Article 41-quater
Non-EU AIFMs

1. The Bank of Italy, in accordance with Consob, authorises non-EU AIFMs to manage Italian and EU AIFs or to market in the EU the AIFs managed, when Italy, pursuant to Directive 2011/61/EU, is the State of reference. The Bank of Italy immediately transmits to Consob copy of the authorisation application of such companies. The Bank of Italy lists non-EU AIFMs in a special section of the register contemplated by article 35. The Bank of Italy notifies Consob of such registrations.

2. Non-EU AIFMs authorised in another EU state which intend to manage an Italian AIF as the free performance of services or through established branches are subject, as far as compatible, to article 41-ter.

3. Non-EU AIFMs which perform the activities contemplated by subsection 1 in the Italian Republic through the establishment of branches must respect the rules of conduct contemplated by article 35-decies and by the relative enactment provisions and the obligations on the management of conflicts of interests in implementation of article 6, subsection 2-bis, letter l). Article 8, subsection 1, is applicable to non-EU AIFMs.

4. After consulting Consob, the Bank of Italy lays down by regulation:

a) the conditions and the procedure for the issue of the authorisation referred to under subsection 1;

b) the enactment provisions of the EU provisions concerning the conditions and procedures that the non-EU AIFMs authorised in Italy must respect in the case of cross-border operations in the EU states in conformity with the provisions of Directive 2011/61/EU and the relative enactment provisions, without prejudice to the provisions of chapter II-ter.

Chapter II-ter273
Marketing of UCIs

Article 42
Marketing in Italy of EU UCITS units and shares

1. The marketing in Italy of EU UCITS units and shares must be preceded by communication to Consob by the authority of the UCITS Home State, in accordance with the procedures set out by EU provisions and in compliance with the relevant enactment regulations adopted by Consob Regulation, after consulting the Bank of Italy. By the same regulation, Consob determines the methods by which the investors’ rights shall be exercised in Italy concerning activities related to payment, repurchase and reimbursement of units.

2. EU management companies intending to offer in Italy, without established branches, units of UCITS managed by the same are not subject to the provisions of article 41-bis.

3. After consulting Consob, the Bank of Italy, by regulation:

a) identifies the information to be given to the public within the sphere of the marketing of the units or shares in the Italian Republic or of the shares in the Italian Republic and the means by which such information must be given;

b) determines the method by which the issue or sale, repurchase or reimbursement price of the units or shares must be published.

4. The Bank of Italy and Consob, within the sphere of their respective duties, may request the issuers and those who provide for the marketing of the units and shares indicated in subsection one, the communication, also periodically, of data and news and the transmission of deeds and documents.

Article 43
Marketing of reserved AIFs

1. The marketing of AIFs is the offer, also indirect, on the initiative or on behalf of the manager, of the AIF units and shares managed, addressed to resident investors or those which registered head office in the EU.

2. The marketing in Italy of units or shares of Italian reserved AIFs, EU AIFs and non-EU AIFs managed by an asset management company or by a non-EU AIFM authorised in Italy and the marketing in an EU state other than Italy, addressed to professional investors, of units and shares of Italian AIFs and non-EU AIFs managed by an asset management company or by a non-EU AIFM authorised in Italy, must be preceded no notification to Consob. Consob immediately transmits to the Bank of Italy the information contained in the notification and the documents attached to the same.

3. The notification shall contain:

a) the letter of notification accompanied by the business programme which identifies the AIF marketed and the Home State of the AIF;

b) the AIF regulations and articles of association;

c) the identify of the custodian of the AIF;

d) the description of the AIF and the other information made available to the investors pursuant to article 6, subsection 2, letter a), no. 3-bis), and the relative enactment discipline;

e) indication of the Home State of the master UCITS if the UCITS marketed is a feeder UCITS;

f) if relevant, indication of the EU State other than Italy in which the AIF units or shares will be marketed;

g) the information on the procedures established to prevent the marketing of the AIF units or shares towards retail investors. For this purpose, the regulations or the statue and the documentation made available to investors contemplate that the AIF units or shares may be marketed only to professional investors.

4. If there is no reason for hindrance, Consob, in accordance with the Bank of Italy, within 20 working days from receiving the notification:

a) informs the asset management company or the non-EU AIFM that it can launch the marketing of the relative AIF units or shares in Italy. In the case of the marketing in Italy of an EU AIF, the notification is also transmitted to the competent authority of the AIF Home State;

b) transmits to the competent authority of the EU State other than Italy in which the asset management company or the non-EU AIFM intends to market the AIF, the notification dossier which includes the documentation contemplated by subsection 3 and the certification referred to in subsection 5. Consob immediately informs the manager of the transmission of the notification dossier.

The manager cannot start marketing before receiving this communication.

5. The Bank of Italy expresses its agreement on the profiles indicated in letters a), b), c) and e) of subsection 3, and on the manager's adequacy for the management of the AIF in question. In the case of marketing in an EU State other than Italy, the Bank of Italy, when it issues its agreement, certifies that the manager is authorised to manage the AIF in question.

6. Consob, after consultation with the Bank of Italy, defines by regulation the procedures for the notification contemplated by subsection 2.

7. In the case of relevant modifications to the information and documents indicated in subsection 3, the manager communicates such modifications to Consob at least thirty days before entry into force or, in the case of modifications which cannot be planned in advance, as soon as they are issued. Consob immediately transmits to the Bank of Italy the information contained in the notification and the documents attached to the same. Within thirty days from receiving the communication, Consob and the Bank of Italy, within the scope of their respective competence, may ban the modification.

8. The marketing in Italy, to professional investors and to the categories of investors identified by the regulations referred to in article 39, of units of shares of Italian reserved AIFs, EU and non-EU AIFs managed by an EU AIFM or by a non-EU AIFM authorised in an EU State other than Italy, shall be preceded by a notification to Consob from the authority of the Home Member State for each AIF marketed. Consob immediately transmits to the Bank of Italy the information contained in the notification and the documents attached to the same. In the case of the marketing of Italian AIF units or shares, the provisions of article 41-ter, subsections 2 and 3 shall hold firm. Consob, after consultation with the Bank of Italy, defines by regulation the procedure for the notification contemplated by this subsection.

9. The provisions of this article relative to asset management companies, EU AIFMs and non-EU AIFMs are also applicable to Italian AIFs and to EU and non-EU AIFs which manage their own assets.

Article 44
Marketing of non-reserved AIFs

1. The provisions of articles 35-bis, 37, 38 and 39 always holding firm, the marketing in Italy of units or shares of Italian non-reserved AIFs to the categories of investors referred to in article 43, is preceded by a notification forwarded by the manager to Consob for each AIF marketed.

2. The following documentation shall be attached to the letter of notification:

a) the prospectus destined for publication;

b) the regulations or the articles of association of the AIF to be marketed;

c) the document containing the additional information to be made available before the investment pursuant to article 6, subsection 2, letter a), no. 3-bis), and the relative enactment provisions, which show the absence of preferential treatment to one or more investors or categories of investors.

3. Consob informs the manager that it can begin marketing to retail investors not falling within the categories of investors to which the reserved Italian AIFs can be marketed, the AIFs indicated in the notification within 10 working days from receiving the same when the completeness, coherence and comprehensibility of the information contained in the documentation attached to the letter of notification has been verified. The manager cannot begin marketing to the retail investors not included in the categories of investors to which the reserved Italian AIFs can be marketed, before receiving the communication.

4. Consob, after consultation with the Bank of Italy, disciplines the notification procedure contemplated by subsection 1.

5. The managers of EU and non-EU AIFs which market in the Home State of the said AIFs the relative shares or units to retail investors and which intend to market such AIFs in Italy to retail investors not included in the categories of investors to which the Italian reserved AIFs can be marketed, shall present to Consob application for authorisation. Consob, in accordance with the Bank of Italy on the profiles referred to under letters b) and c), authorises the marketing if the following conditions are respected:

a) the managers have completed the procedures contemplated by article 43;

b) the functioning schemes and the risk mitigation and fractioning provisions for said AIFs are compatible with those contemplated for Italian AIFs;

c) the discipline of the AIF custodian is equivalent to that applicable to Italian non-reserved AIFs;

d) the AIF regulations or articles of association do not allow for preferential treatment to one or more investors or categories of investors pursuant to article 35-decies, subsection 1, letter d), and the EU provisions in force which discipline the subject;

e) the organisational model adopted shall ensure the exercise in Italy of the investor's economic rights in compliance with the regulatory provisions dictated by Consob, after consultation with the Bank of Italy;

f) the information to be made available to retail investors before the investment must be complete, coherent and comprehensible;

6. Consob, after consultation with the Bank of Italy, defines by regulation the procedures for the issue of the authorisation contemplated by subsection 5.

7. The offer to the public and the admission for the trading of the AIF units or shares marketed pursuant to this article are subject to the provisions contemplated by part IV, title II, chapter I and title III, chapter I and the relative enactment provisions.

8. In the case of AIFs subject to the discipline contemplated by part IV, title II, chapter I, section I, for the offer of which Italy is the Home Member State, the notification contemplated by subsection 1 shall be considered as made also for the purposes and effects of article 94, subsection 1, and the verification of the completeness, coherence and comprehensibility of the information contained in the document referred to in subsection 2, letter c), is carried out during the course of the procedure contemplated by article 94-bis, subsection 2. The communication contemplated by subsection 3 is made with the provision of the approval of the prospectus.

9. Consob and the Bank of Italy exercise the powers, contemplated by articles 8 and 10, over the foreign organisms indicated under subsection 5 and the relative managers.

Chapter II-quater274
Obligations of the asset management companies the AIFs of which acquire relevant or or controlling interests of non-listed companies and of issuers

Article 45
Obligations relative to the acquisition of relevant or controlling interests of non-listed companies

1. The asset management companies inform Consob when they reach, exceed or reduce to below 10%, 20%, 30%, 50% and 75% the voting rights in a non-listed company consequent to the acquisition, holding or disposal of stakes in the share capital on the part of the Italian AIF or the EU or non-EU AIF managed by the same. The communication must be made within ten working days of the date of the operation.

2. The asset management companies whose Italian, EU or non-EU AIF acquire or hold, also indirectly through trust companies or proxies, the absolute majority of the voting rights which can be exercised in the shareholders' meeting of a non-listed company, shall report the acquisition of control within ten working days:

a) to the company;

b) to the shareholders whose identity and addresses are available to the asset management company or which can be made available through the non-listed company or through a register to which the asset management company may have access;

c) to Consob.

3. The provisions contained in subsections 1 and 2 also apply to:

a) the asset management companies whose AIFs acquire, also jointly, a relevant interests in a non-listed company;

b) the asset management companies which manage one or more AIFs which, individually or jointly on the basis of an agreement, acquire control of a non-listed company;

c) the asset management companies which cooperate with other asset management companies or with EU or non-EU AIFMs, on the basis of an agreement pursuant to which the AIFs managed by the same jointly acquire control of a non-listed company;

d) the SICAVs and the SICAFs which directly manage their own assets and which are in the situations contemplated by letters a), b) and c).

4. For the purposes of this article, non-listed companies are those with registered office in the European Union and which have no shares admitted for trading on a regulated market, other than:

a) micro, small and medium companies as defined by article 2, paragraph 1, of the annex to Recommendation 2003/361/EC of the European Commission, of 6 May 2003;

b) vehicle companies whose purpose is the acquisition, holding or management of fixed assets.

5. Consob, in compliance with the provisions of Directive 2011/61/EU, establishes by regulation:

a) the procedures for making the communications contemplated by subsection 1;

b) the content and the procedures for compliance with the information obligations towards the subjects indicated in subsection 2, and those of the workers' representatives of the non-listed company or, in their absence, the workers themselves;

c) the content of the additional information to be included in the annual report of the non-listed subsidiary, as well as the procedures and terms according to which said report is made available by the governing body to the workers' representatives or, in their absence, to the workers themselves;

d) the obligations that the asset management company must fulfil to guarantee the protection of the capital and to prevent the unbundling of the activities of the non-listed company for a period of twenty-four months from the acquisition of control in the part of the UCIs managed.

Article 46
Obligations relative to the acquisition of a controlling interest of an issuer

1. The asset management companies whose Italian, EU and non-EU AIFs acquire a controlling stake of an issuer's capital communicated the information established by Consob in its own regulation, according to the procedures and terms established therein, to:

a) the issuer;

b) the shareholders whose identity and addresses are available to the asset management company or which can be made available through the issuer or through a register to which the asset management company may have access;

c) Consob.

2. For the purposes contemplated by subsection 1, the acquisition of a controlling stake refers to the acquisition, on the part of an asset management company, individually or jointly with other asset management companies, and also indirectly through trustees or proxies, of a stake which attributes voting rights equal to or more than thirty percent of the capital of an issuer with registered office in Italy, or the diverse threshold determined pursuant to article 5, paragraph 3, of Directive 2004/25/EC, concerning public acquisition offers, according to the law of the Member State where the issuer has its head office.

3. This article also applies to:

a) the asset management companies which manage one or more Italian, EU or non-EU AIFs which, individually or jointly on the basis of an agreement, acquire control of an issuer;

b) the asset management companies which cooperate with other asset management companies or with EU or non-EU AIFMs, on the basis of an agreement pursuant to which the Italian, EU or non-EU AIFs managed by the same jointly acquire control of an issuer;

c) the SICAVs and the SICAFs which directly manage their own assets and which are in the situations contemplated by letters a) and b).

4. Consob, in compliance with the provisions of Directive 2011/61/EU, establishes by regulation:

a) the content and the procedures for compliance with the information obligations towards the subjects indicated in subsection 1, and those of the workers' representatives of the issuer;

b) or, in their absence, the workers themselves;

c) the obligations that the asset management company must fulfil to guarantee the protection of the capital and to prevent the unbundling of the activities of the issuer for a period of twenty-four months from the acquisition of control in the part of the UCIs managed.

5. For the purposes of this article, issuers are companies with shares admitted for trading on a regulated market, other than:

a) micro, small and medium companies as defined by article 2, paragraph 1, of the annex to Recommendation 2003/361/EC of the European Commission, of 6 May 2003;

b) vehicle companies whose purpose is the acquisition, holding or management of fixed assets.

Chapter II-quinquies275
UCITS credit

Article 46-bis
Direct issue of loans by Italian AIFs

1. Italian AIFs may invest in loans, against the equity of the same, in favour of subjects other than consumers, in line with the rules of this decree and the relative implementation provisions adopted pursuant to articles 6 paragraph 1, and 39.

Article 46-ter
Direct issue of loans by EU AIFs in Italy

1. EU AIFs may invest in loans, against the equity of the same, to subjects other than consumers, in Italy with the following conditions:

a) the EU AIF is authorised by the competent authority of the member states of origin to invest in loans, including those issued against the equity of the same, in its country of origin;

b) the EU AIF has a closed structure and the operating model of the same, particularly regarding investment methods, is the same as that of the Italian AIFs that invest in loans;

c) the regulations of the country of origin of the EU AIF regarding containment and portioning of risk, including financial leverage limits, are equivalent to the regulations established for Italian AIFs that invest in loans. Equivalence with respect to Italian regulations can be checked also with reference only to the provisions of the by-laws or regulations of the EU AIF, providing that the competent authority of the member state of origin assures their observance.

2. The managers of EU AIFs which intend to invest in loans against the equity of the same in Italy inform Bank of Italy of this intention. The EU AIF may not begin operations until sixty days from this communication, within which time Bank of Italy may prohibit investment in loans against the equity of the same in Italy.

3. Art. 8, paragraph 1 is applicable to the managers. Bank of Italy may provide for the participation of the EU AIFs at the Central Credit Register pursuant to paragraph 1, and may also provide that participation occurs via banks and intermediaries listed in the register pursuant to article 106 of Italian Legislative Decree no. 385 of 1 September 1993.

4. Italian provisions applicable to EU AIFs remain effective for the sale of shares and quotas and every other area not expressly regulated by this article.

5. Bank of Italy dictates the implementing provisions of the present article.

Article 46-quater
Other applicable provisions

1. Regarding loans issued in Italy by Italian AIFs and EU AIFs, against the equity of the same, the following find application: provisions on transparency of contractual terms and terms governing relationships with customers pursuant to Title VI, Chapters I and III, excluding article 128-bis, and the provisions on administrative sanctions pursuant to Title VIII, Chapters V and VI, of Italian Legislative Decree no. 385 of 1 September 1993, without prejudice to that provided for by article 23, paragraph 4 of this decree.

2. The AIF manager is bound to respect the obligations laid out by the provisions indicated in paragraph 1.

Chapter III276
Custodian

Article 47
Custodian mandate

1. For each UCI, the manager confers custodian mandate on a single subject, to which the assets of the UCI are entrusted as contemplated in this chapter.

2. The custodian mandate may be conferred on authorised banks in Italy, Italian branches of Community banks, investment companies and Italian branches of investment enterprises.

3. The Bank of Italy authorises the exercise of custodian functions and, after consulting Consob, the conditions for accepting the mandate.

4. The directors and auditors of the custodian report without delay to the Bank of Italy and Consob, each for its own competence, any irregularities found in the manager's management and in the management of the UCIs and, at the request of the Bank of Italy or Consob, gives information on facts and acts of which it gains knowledge in the performance of its custodian duties.

Article 48
The custodian's duties

1. The custodian acts independently and in the interests of the UCI investors. It adopts every appropriate measure to prevent potential conflicts of interests between the performance of its custodian duties and the other activities carried out.

2. The custodian fulfils the obligations of the custody of the financial instruments entrusted to the same and verification of ownership, and also the obligation to keep registers of other assets. Unless entrusted to other subjects, it also holds the available liquidity of the UCIs.

3. The custodian, in the performance of its duties:

a) verifies the legitimacy of the operations of sale, issue, repurchase, reimbursement and annulment of the fund units, as well as the destination of the revenues of the UCI;

b) checks that the calculation of the value of the parts of the UCI is correct or, in the case of Italian AIFMs, at the request of the manager, provides for said calculation;

c) verifies, in operations relative to the UCI, that the counter-obligation is fulfilled within the established terms;

d) carries out the manager's instructions, providing they are not against the law, regulations or the prescriptions of the supervisory bodies;

e) monitors the UCI cash flows, if the liquidity is entrusted to the same.

4. The Bank of Italy, after consulting Consob, issues enactment provisions of this article, also with reference to the identification of subjects other than the custodian to which the available liquidity may be entrusted, the procedures for the deposit of such available liquidity, and the conditions for delegating custody and for the re-use of the UCI assets on the part of the custodian.

Article 49
The custodian's responsibilities

1. The custodian is responsible towards the UCI manager and investors for any prejudice they may suffer consequent to non-fulfilment of its obligations.

2. In the case of the loss of financial instruments in custody, unless the custodian can prove that the default was caused by accident or by force majeure, it shall be held to return, without undue delay, financial instruments of the same kind or a sum of the corresponding amount, and shall be held liable for any other loss sustained by the UCI or the investors consequent to failure to respect its obligations, whether intentional or due to negligence.

3. In the case of loss of financial instruments on the part of the third party to which custody has been delegated, the custodian shall always bear liability, unless written agreements have been stipulated between the manager, the custodian and the third party to which custody has been delegated, aimed at determining the exclusive assumption of liability on the part of the third party. For the possible stipulation of such agreements, the manager, the custodian and the third party shall adhere to the discipline, established by the Bank of Italy after consultation with Consob, which identifies the cases in which such agreements are allowed and their minimum content.

4. In the case of the exclusive assumption of liability on the part of the third party pursuant to subsection 3, it shall answer pursuant to subsection 2. The third party shall always remain liable if it, in turn, delegates the custody of the financial instruments to another subject, without prejudice to the possibility of agreements as contemplated in subsection 3.

Article 50
Other applicable provisions

…omissis…277

Chapter III-bis278
Master-feeder structures

Article 50-bis
Authorisation and rules of operation of master-feeder structures

…omissis…279

Chapter III-ter280
Merger and spin-off of asset investment bodies

Article 50-ter
UCITS merger and spin-off

…omissis…281

Article 50-quater
Cross-border merger of harmonised UCITS

…omissis…282

Chapter III-quater283
Management of portals for the collection of capital for innovative start-ups and innovative SMEs284

Article 50-quinquies
Management of portals for the collection of capital for innovative start-ups and innovative SMEs285

1. The portal manager is the subject who professionally manages portals for the collection of capital for innovative start-ups, for innovative SMEs, for collective investment bodies and for companies which invest primarily in innovative start-ups and in innovative SMEs entered on the register referred to in subsection 2286.

2. The management of portals for the collection of capital for innovative start-ups, for innovative SMEs, for collective investment bodies and for companies which invest primarily in innovative start-ups and in innovative SMEs is reserved to the investment companies and banks authorised to provide the relative investment services and to the subjects entered on a special register held by Consob, providing these latter transmit the orders regarding the underwriting and trading of financial instruments representing capital exclusively to banks and investment companies. The subjects on the said register are not subject to the provisions of Part II, Title II, Chapter II and of article 32287.

3. The following requisites are necessary for entry on the register referred to in subsection :

a) the enterprise must be a joint stock company, a company with unlimited responsibility, a limited company or a cooperative society;

b) the registered and administrative head office or, for Community subjects, the permanent seat, must be located in the Italian Republic;

c) the company's purpose must be that contemplated in subsection 1;

d)the controlling shareholders or the subjects who have power of administration, direction and control must have the integrity requirements established by Consob;

e) the controlling shareholders or the subjects who have power of administration, direction and control must have the professional requirements established by Consob;

4. The subjects on the register referred to in subsection 2 may not hold sums of money or financial instruments belonging to third parties.

5. Consob determines, by regulation, the principles and criteria relative to:

a) the format of the register and the relative forms of publicity;

b) any other conditions for entry on the register, reasons for suspension, for being struck off and for reinstatement, and the measures applicable to those on the register;

c) any other causes of incompatibility;

d) the rules of conduct that portal managers must respect in their relations with investors, contemplating a simplified system for professional customers.

6. Consob supervises portal managers to check on compliance with the provisions of this article and the relative implementation rules. For this purpose, Consob may request the communication of data and information and the transmission of deeds and documents, fixing the relative terms, and may also carry out inspections.

7. Portal managers who breach the provisions of this article or the provisions issued by Consob pursuant to the same, are punished, according to the severity of the breach and taking into account possible relapse, with a fine from five hundred euro to twenty-five thousand euro. Subjects on the register referred to in subsection 2, may also be suspended from one to four months or struck off the register. Subsections 2 and 3 of article 196 are applied. The provisions of Part II, Title IV, Chapter I, applicable to investment companies, asset management companies and harmonised management companies shall always hold firm288.

TITLE IV
INJUNCTIVE REMEDIES AND CRISES

Chapter I
Injunctive remedies

Article 51
Injunctive remedies vis-à-vis Italian and non-EU intermediaries

1. In the event of violations by Italian investment companies, non-EU investment companies and banks, asset management companies, of SICAFs, non-EU AIFMs authorised in Italy or banks authorised to provide investment services and activities having their registered office in Italy of the provisions applicable to them under this decree, the Bank of Italy or Consob, to the extent of their duties, may order them to put an end to such irregularities289

2. The supervisory authority which takes action may also, after consulting the other authority, prohibit the persons referred to in subsection 1 from engaging in new transactions as well as place any other limitation with regard to each type of transaction involving single services or activities, at single branches or establishments of the intermediary or otherwise where290:

a) the violations are likely to prejudice interests of a general nature;

b) it is a matter of urgency to protect the interests of investors.

Article 52
Special measures for EU intermediaries

1. In the event of violations by EU investment companies with branches in Italy, of EU management companies, EU and non-EU AIFMs authorised in an EU State other than Italy, EU banks with branches in Italy or financial companies referred to in Article 18(2) of the Consolidated Law on Banking of the rules applicable to them according to the Italian order, the Bank of Italy or Consob, to the extent of their duties, may order them to put an end to such irregularities and shall inform the competent supervisory authorities of the member state in which the intermediary has its registered office so that any necessary measures may be taken291.

2. The supervisory authority which takes action may, after consulting the other authority, adopt the necessary measures, including the prohibition of new transactions, as well as any other limitation with regard to each type of transaction, single services or activities, also limited to single branches or establishments of the intermediary, and may also order the closure of branches where292:

a) the competent authorities of the member state in which the intermediary has its registered office take no measures or measures that prove inadequate;

b) violations of the rules of conduct are found;

c) the irregularities are likely to prejudice interests of a general nature;

d) it is a matter of urgency to protect the interests of investors.

3. The measures provided for in subsection 2 shall be notified by the authority that has adopted them to the competent authorities of the member state in which the intermediary has its registered office.

3-bis. Where there are grounds to suspect that an EU investment company of bank freely operating in Italy do not comply with obligations deriving from provisions of the European Union, the Bank of Italy or Consob shall inform the competent authority of the member state in which the intermediary's registered office is based to arrange necessary measures. If despite measures adopted by the competent authority the intermediary continues to act in a manner that compromises the interests of investors or regular market operations, the Bank of Italy or Consob, after notifying the competent authority of the member state in which the intermediary's registered office is based, shall adopt all measures necessary, including the prohibition of execution of further operations in Italy. After consulting the other authority, the Bank of Italy or Consob shall proceed and inform the European Commission of the measures adopted293.

3-ter. Subsection 3-bis shall also apply in the case of violations by EU investment companies or banks with branches in Italy of obligations or EU management companies and EU and non-EU AIFMs authorised in an EU state other than Italy, deriving from European Union provisions for which the competent authority is that of the EU member state in which the intermediary’s registered office is based294.

3-quater. If the violation regards provisions on the liquidity of the Community investment company, or in any other case of deterioration of its liquidity situation, the Bank of Italy may take the measures necessary for financial stability or to protect the accounts of the persons to whom services are provided, if those taken by the competent authority of the State of origin are inadequate or missing; the measures to be taken shall be communicated to the competent authority of the State of origin295.

Article 53
Suspension of administrative bodies

1. In situations of danger for customers or markets, the Chairman of Consob may suspend the administrative bodies of an Italian investment company as a matter of urgency and appoint a provisional administrator to take over its management where serious administrative irregularities or serious violations of laws, regulations or Articles of Association are found.

2. The appointment of the provisional administrator shall be for a maximum of sixty days. In the performance of his or her duties, the provisional administrator shall be a public official. The Chairman of Consob may establish special safeguards and limitations on the management of the Italian investment company.296

3. The emolument due to the provisional administrator shall be determined by Consob on the basis of criteria it shall establish and charged to the Italian investment company. The last sentence of Article 91, subsection 1 of the Consolidated Law on Banking shall apply297.

4. Civil actions against the provisional administrator for acts performed in carrying out his official duties shall be brought subject to authorisation by Consob.

5. This article shall also apply to the Italian branches of non-EU investment companies. The provisional administrator shall assume the powers of the administrative bodies of the investment company with regard to such branches.

6. This article shall also apply to asset management companies and SICAVs. The Chairman of Consob shall adopt the suspension measure after consulting the Governor of the Bank of Italy.

Article 54
Injunction orders on EU UCITS and EU and non-EU AIFs with units or shares offered in Italy298

1. Where there are grounds to believe that EU UCITS and EU and non-EU AIFs has violated the provisions applicable to it under this decree, the Bank of Italy or Consob, within the scope of their respective authority, may suspend the marketing of its units or shares as a precautionary measure and for a period not longer than sixty days. If the violation is verified, the supervisory authorities, within the scope of their respective authority, may suspend temporarily or prohibit the marketing of the collective investment undertaking's units or shares.299

1-bis. If there is a reason to suspect that an EU UCITS and an EU and non-EU AIF whose units or shares are offered in Italy, or the manager of such a UCITS is no compliant with the obligations deriving from European Union provisions for which the Home State of the UCITS is competent, the Bank of Italy or Consob shall inform the competent authority of said State in order that it should take all steps necessary. If, despite the steps taken by the competent authority, the UCITS or its manager should continue to act in such a way as to prejudice the interests of the investors or the correct function of the markets, the Bank of Italy or Consob, after having informed the Home State authority, shall take the steps necessary to protect investors or ensure the correct market function, including prohibiting the offer of the units or shares of the UCITS300

Article 55
Precautionary measures applicable to the financial advisors authorised to make off-premises offers301

1. In cases of necessity and as a matter of urgency [Consob]302 may, as a precautionary measure, suspend financial advisors authorised to make off-premises offers from the exercise of their activity for a maximum of sixty days, where there are grounds to believe that there have been serious violations of the law or of general or specific rules laid down by Consob.303

2. [Consob]304 may, as a precautionary measure and for a maximum of one year, suspend financial salesmen from the exercise of their activity where they have been subjected to one of the precautionary measures referred to in Book IV, Title I, Chapter II of the Criminal Procedure Code or where they are defendants pursuant to Article 60 of that Code for:

a) crimes referred to in Book V, Title XI, of the Civil Code and in the bankruptcy law;

b) crimes against the public administration, against the good faith of the public, against property, against public order or against the public economy, and tax crimes;

c) the crimes referred to in Title VIII of the Consolidated Law on Banking;

d) the crimes referred to in this decree305;

Chapter I-bis306
Recovery plans, group financial support and early intervention

Article 55-bis
Scope of application

1. This Chapter applied to investment companies whose registered office is in Italy and which provide one or more of the following services or investment activities:

a) trading on its own behalf;

b) subscribing and/or placement, with firm commitment or with guarantee towards the issuer;

c) management of multilateral trading systems.

2. For the purposes of this Chapter, the definitions contained in article 69-bis of the Consolidated Law on Banking are applicable.

3. The Bank of Italy adopts provisions for the implementation of this Chapter, also to take into account the guidelines of the EBA.

Article 55-ter
Recovery plans

1. The investment companies shall adopt an individual recovery plan in compliance with article 69-quater of the Consolidated Law on Banking. The investment companies belonging to a banking group or to a group identified pursuant to article 11 are not held to provide themselves with an individual recovery plan unless they are specifically requested to do so by the Bank of Italy. For investment companies subject to surveillance consolidated in another Community State, the request for individual plans is made in compliance with article 69-septies of the Consolidated Law on Banking.

2. The leading company of a group as contemplated by article 11 shall adopt a group recovery plan in the cases and in the manner contemplated by article 69-quinquies of the Consolidated Law on Banking.

3. The Bank of Italy, after consulting Consob for the aspects of its competence, assesses the recovery plans indicated under paragraphs 1 and 2 according to the provisions of articles 69-sexies and 69-septies of the Consolidated Law on Banking. It may provide for simplified methods of fulfilling the obligations established by this article as contemplated by article 69-decies of the Consolidated Law on Banking.

4. Articles 69-octies and 69-novies of the Consolidated Law on Banking shall be applied.

Article 55-quater
Group financial support

1. Investment companies belonging to a group as contemplated by article 11 may conclude agreements with other members of the group for the supply of financial support if the conditions for early intervention pursuant to article 55-quinquies are met for one of them. The agreements are subject, as far as compatible, with articles 69-duodecies, 69-terdecies, 69-quaterdecies, 69-quinquiesdecies, 69-sexiesdecies and 69-septiesdecies of the Consolidated Law on Banking.

Article 55-quinquies
Early intervention

1. The Bank of Italy, after consulting Consob for the aspects of its competence, may issue the measures indicated under articles 69-noviesdecies and 69-vicies-semel of the Consolidated Law on Banking towards an investment company or a company at the head of a group pursuant to article 11 in the case of the conditions indicated by article 69-octiesdecies of the Consolidated Law on Banking. For this purpose the Bank of Italy exercises the powers indicated by articles 8, 10 and 12, paragraph 5. The measures are adopted by Consob proposal when the infringements regard provisions for which it supervises compliance.

2. The investment companies disciplined by this Chapter are not subject to article 56-bis.

Chapter II
Crisis procedures

Article 56
Special administration

1. The Bank of Italy, on its own initiative or on a proposal formulated by Consob within the sphere of its competence, may order the dissolution of the bodies which direct and control the investment companies, the asset management companies, the SICAVS [open-end investment companies] and the SICAFS [closed-end investment companies] when:

a) serious irregularities are found in the administration or serious breaches of the legislative, administrative or statutory provisions which discipline the activity, always if the action indicated by articles 55-quinquies or 56-bis, when applicable, are not sufficient to remedy the situation;

b) the company's capital has suffered serious losses;

c) winding up is requested with a reasoned request by the administrative bodies or by the extraordinary shareholders' meeting or by the commissioner appointed pursuant to article 53307.

2. The measure provided for in subsection 1 may also be adopted with respect to the Italian branches of non-EU investment companies and of non-EU AIFMs authorised in Italy. In this case the administrator and the oversight committee assume the powers of the investment company's administrative and control bodies with respect to such branches308.

3. The Bank of Italy shall be responsible for the direction of the procedure and all the related formalities. Insofar as they are compatible, articles 70, paragraphs 2, 3, 4 and 5, 71, 72, 73, 74, 75, 75-bis and 77-bis of the Consolidated Law on Banking are applicable, where such provisions shall be understood to refer to investors instead of depositors and to Italian investment companies, non-EU investment companies, asset management companies and to SICAVs, SICAFs and non-EU AIFMs authorised in Italy instead of banks; and the term "financial instruments" shall refer to financial instruments and cash309.

4. Title IV of the Bankruptcy Law shall not apply to Italian investment companies or asset management companies or SICAVs and SICAFs310.

4-bis. The procedure disciplined by this article is also applicable to the leading companies of investment company groups pursuant to article 11 and the other members of the group. Articles 98, 100, 102, 103, 104 and 105 of Italian Legislative Decree no. 385 of 1 September 1993 are applicable, the said provisions being understood as referring to investment companies instead of banks, and to the leading companies of groups pursuant to article 11 instead of the parent company. With reference to article 64 of Italian Legislative Decree no. 385 of 1 September 1993, contained in article 105 of Italian Legislative Decree no. 385 of 1 September 1993, it is understood that article 11 of this decree is implemented311.

Article 56-bis
Collective removal of the members of administrative and control bodies

1. The Bank of Italy may order the removal of all members of bodies that administer and control SIMs, asset management companies and SICAVs and related parent company under the conditions specified in Article 56, subsection 1, letter a). The provision is published in extract form in the Official Journal of the Italian Republic.

2. The provision sets the date of removal of members of bodies. The Bank of Italy convenes the shareholders' meeting of the SIM, asset management company, SICAV or parent company with the renewal of the administrative and control bodies on the agenda.

3. The possibility remains of, at any time, having special administration in the cases provided for in Article 56, in the manner and with the effects laid down in this Title312.

Article 57
Compulsory administrative liquidation

1. The Minister of the Economy and Finance,313 acting on a proposal from the Bank of Italy or Consob to the extent of their duties, may issue a decree withdrawing authorisation to carry on business and ordering the compulsory administrative liquidation of Italian investment companies, asset management companies, SICAVs and SICAFs, even when special administration or liquidation under ordinary rules is already in effect, where the administrative irregularities or the violations of laws, regulations or Articles of Association or the losses referred to in Article 56 are exceptionally serious. In the case of the investment companies indicated under article 55-bis, paragraph 1, liquidation is ordered in the case of the conditions indicated under article 17 of the [decree implementing Directive 2014/59/EU], but that indicated under article 20 of the same decree for ordering the winding up does not exist314.

2. Compulsory liquidation may be ordered in the manner provided for in subsection 1 upon a reasoned request by the administrative bodies, the extraordinary shareholders' meeting, the provisional administrator appointed pursuant to Article 53, the special administrators or the liquidators.

3. The Bank of Italy is responsible for directing the procedure and for fulfilling all the procedures connected to the same. As far as compatible, Article 80, paragraphs from 3 to 6, and Articles 81, 82, 83, 84, 85, 86 except for paragraphs 6 and 7, 87 paragraphs 2 and 3, 88, 89, 90, 91 except for paragraphs 1-bis and 11-bis, 92, 92-bis, 93, 94 and 97 of the Consolidated Law on Banking are applied, the above provisions being understood as referring to investment companies, asset management companies, SICAVS and SICAFS in place of banks, and the expression “financial instruments” is understood as referring to financial instruments and to cash. For the purposes of the application of Article 92-bis of the Consolidated Law on Banking to asset management companies, the provisions contained therein relative to customers entered in the separate section refer to funds or segments managed by the company315.

3-bis. If the compulsory liquidation is arrange of an asset management company, the liquidators appointed with liquidate or dispose of the funds it manages and the related segments, to this end exercising the relevant administrative powers. Insofar as they are compatible, Articles 83, 86, with the exception of paragraphs 6 and 7, 87, paragraphs 2 and 3, 88, 89, 90, 91, with the exception of paragraphs 1-bis, 2, 3 and 11-bis, 92, 92-bis, 93 and 94 of the Consolidated Law on banking and paragraphs 4 and 5 of this Article shall apply. Investors in funds or segments have the exclusive right to the allocation of the net residue from liquidation proportionally to the respective investment shares held; from the date on which the compulsory administrative liquidation decree is issued, the functions of the fund bodies shall cease316.

4. The liquidators, within thirty days of the expiry of the limitation period referred to in Article 86(5) of the Consolidated Law on Banking and after consulting the superseded directors, shall file the lists of admitted creditors, indicating the existence and order of rights of preference, of holders of rights referred to in subsection 2 of such article and of persons belonging to the same categories whose request for allowance of their claims has been denied with the Bank of Italy and, for inspection by those having entitlement, with the clerk of the court of the place where the Italian investment company or management company or the SICAV and the SICAF has its registered office. Customers entitled to the restitution of financial instruments and funds in connection with services and activities referred to in this decree shall be entered in a special section of the statement of liabilities. This subsection shall apply in the place of Articles 86(6) and 86(7) of the Consolidated Law on Banking317.

5. Persons whose claims have not been allowed in whole or in part may present objections to the statement of liabilities regarding their own position and to the recognition of rights in favour of persons included in the lists referred to in subsection 4, within fifteen days of receipt of the communication referred to in Article 86(8) of the Consolidated Law on Banking, and persons whose claims have been admitted may present objections within the same time limit starting from the publication of the notice referred to in subsection 8 of such article. This subsection shall apply in the place of Article 87(1) of the Consolidated Law on Banking318.

6. If the compulsory administrative settlement regards a SICAV or a SICAF, the commissioners shall inform shareholders within thirty days of appointment of the number and type of shares pertaining to each in accordance with company records and documents319.

6-bis. Should fund or segment activities not enable their obligations to be met and should there be no reasonable prospects that this situation will be overcome, one or more creditors or the asset management company may request the liquidation of the fund before the court of the place in which the asset management company has its registered office. The court, having consulted with the Bank of Italy and the legal representatives of the asset management company, where the risk of damages is considered grounded, orders the liquidation of the fund with sentenced resolved in the council chamber. In this event, the Bank of Italy shall appoint one or more liquidators who will order in accordance with the provisions of paragraph 3-bis; asset management companies or entities may also be appointed liquidators. The provision of the Bank of Italy is published in extract form in the Official Journal of the Italian Republic. Insofar as it is compatible, Article 84, with the exception of paragraphs 2 and 5, of the Consolidated Law on Banking shall apply to liquidators. If the asset management company managing the fund is subsequently subjected to compulsory administrative liquidation, the liquidators of the asset management company shall administer the fund on the basis of a situation of the accounts prepared by the fund’s liquidators. When the fund or the segment is without liquid resources or these are estimated by the liquidator as insufficient to satisfy the credits subject to pre-deduction before the closure of the liquidation, the liquidators pay, with priority in respect of all the other pre-deductible credits, the expenses necessary for the execution of the liquidation, the indemnities and expenses for fulfilling the liquidators' mandates, and the expenses for ascertaining the deficit, for maintaining and selling the assets, for the execution of the divisions and returns and for the closure of the liquidation itself, using first any liquid resources that may be available to the liquidation and then the sums made available by the asset management company which manages the fund or the segments, which sums will always be borne by the company itself. Article 92-bis, paragraphs 1, 2, 3, 4 and 5, of the Consolidated Law on Banking is not applied; paragraph 6 of the same article is applied if there is no prospects of profit from the sale of the assets of the fund or segment320.

6-ter. The procedure disciplined by this article is also applicable to the leading companies of investment company groups pursuant to article 11 and the other members of the group. Articles 99, 101, 102, 103, 104 and 105 of Italian Legislative Decree no. 385 of 1 September 1993 are applicable, the said provisions being understood as referring to investment companies instead of banks, and to the leading companies of groups pursuant to article 11 instead of the parent company. With reference to article 64 of Italian Legislative Decree no. 385 of 1 September 1993, contained in article 105 of Italian Legislative Decree no. 385 of 1 September 1993, it is understood that article 11 of this decree is implemented321.

Article 58
Branches in Italy of foreign investment companies and managers

1. In the case of the revocation of the authorisation for the business practice of a Community investment company, an EU management company, or an EU or non-EU AIFM authorised in a Member State of the EU other than Italy, on the part of the competent authority, the Italian branches may be subjected to enforced liquidation pursuant to the provisions of article 57, as far as compatible.

2. Italian branches of non-Community investment companies and of non-EU AIFMs authorised in Italy are subject to the provisions of article 57, as far as compatible322.

Article 58-bis
Investment enterprises operating within the European Community

1. The recovery provisions and the liquidation procedures of investment companies indicated under article 55-bis, paragraph 1, and of European investment companies which perform the activities indicated by the same article, are subject to the application of articles 95-bis, 95-ter, 95-quater, 95-quinquies and 95-septies of the Consolidated Law on Banking, the said provisions being understood as referring to investment companies and European investment companies instead of banks

2. For the purposes of paragraph 1:

a) the reference to article 79, paragraph 1, of the Consolidated Law on Banking contained in article 95-bis, paragraph 1-bis, of the same decree is understood as referring to article 52, paragraph 1, of this decree;

b) the request referred to by article 95-quater, paragraph 2, of the Consolidated Law on Banking can be carried out subsequent to a Consob report in the case of the conditions contemplated by article 56, paragraph 1, letter a);

c) the Bank of Italy can issue provisions for the implementation of this article pursuant to article 95-sexies of the Consolidated Law on Banking323.

Article 59
Compensation systems

1. The issue of authorisation for the provision of investment services and activities shall be subject to membership of a compensation system for the protection of investors recognized by the Minister of the Economy and Finance324 after consulting the Bank of Italy and Consob325 / 326.

2. The Minister of the Economy and Finance,327 after consulting the Bank of Italy and Consob, shall adopt a regulation on the organisation and operation of compensation systems.328

3. The Bank of Italy, after consulting Consob, shall issue a regulation on the coordination of the operation of compensation systems with the compulsory administrative liquidation procedure and supervisory activity in general.

4. Compensation systems shall succeed to the rights of investors up to the amount of payments made to them.

5. The bodies of the insolvency procedure shall verify and certify whether claims admitted to the statement of liabilities arise from the provision of investment services and activities covered by compensation systems329.

6. The competent court for legal actions involving requests for compensation shall be the court of the place in which the registered office of the compensation system is located.

Article 60
Foreign intermediaries' membership of compensation systems

1. Branches of EU investment companies,

of EU management companies and EU and non-EU AIFMs authorised in an EU State other than Italy or banks established in Italy may join a recognized compensation system, with reference exclusively to the activity carried on in Italy, in order to supplement the protection provided by the compensation system in force in their home country330.

2. Unless they are members of an equivalent foreign compensation system, branches of non-EU investment companies and banks established in Italy must join a recognized compensation system, with reference exclusively to the activity carried on in Italy. The Bank of Italy shall verify whether the protection provided by foreign compensation systems to which branches of non-EU investment companies and banks operating in Italy belong can be considered equivalent to that provided by recognized compensation systems.

Article 60-bis 331
Responsibilities of investment companies, asset management companies, SICAVs and SICAFs for administrative offences depending on crime332

1. Public prosecutors who enter an administrative offence involving an Italian investment company or management company or a SICAV or a SICAF in the register of suspected crimes pursuant to Article 55 of Legislative Decree 231/2001 shall notify the Bank of Italy and Consob. The Bank of Italy and Consob may be heard during the proceedings at the request of the public prosecutor; they may submit written briefs333.

2. In every court concerned with the merits of the case, the judge, proceeding on his own authority or otherwise, shall provide for the acquisition from the Bank of Italy and Consob of updated information on the situation of the intermediary, with special reference to its organisational structure and internal control system.

3. An unappealable sentence that imposes interdictive sanctions referred to in Articles 9(2)(a) and 9(2)(b) of Legislative Decree 231/2001 on an Italian investment company or management company or a a SICAV, or a SICAF shall be transmitted, upon expiration of the time limit for the conversion of the sanctions, by the judicial authority to the Bank of Italy and Consob for enforcement. To this end Consob or the Bank of Italy, within the scope of their respective authority, may propose or adopt the measures referred to in Part II, Title IV, taking account of the nature of the sanction imposed and the primary aim of safeguarding stability and protecting the rights of investors334.

4. The interdictive sanctions referred to in Articles 9(2)(a) and 9(2)(b) of Legislative Decree 231/2001 may not be applied on a precautionary basis to Italian investment companies or asset management companies or SICAVs and SICAFs. Neither shall Article 15 of Legislative Decree 231/2001 apply to such intermediaries335.

5. This article shall apply to the Italian branches of EU and non-EU investment companies , of EU management companies, EU and non-EU AIFMs authorised in Italy and non-EU AIFMs authorised in an EU Member State other than Italy insofar as it is compatible336.

Chapter II-bis337
Winding up of investment companies

Article 60-bis.1
Scope of application

1. This Chapter is applied to the investment companies indicated under article 55-bis, paragraph 1, and to the Italian branches of non-European investment companies which perform the activities indicated by the same article, unless included within the scope of application of the decree [implementing Directive 2014/59/EU] 338.

2. The investment companies which fall within the scope of application contemplated by article 2 of the decree [implementing Directive 2014/59/EU]339 are equivalent to banks for the purposes of the application of the said decree.

3. In relation to what is disciplined by this Chapter, and also in derogation from articles 1, 2, 3, 4, 4-bis and 4-ter, articles 3, 4, 5 and 6 of the decree [implementing Directive 2014/59/EU]340, are applied as well as the definitions contained in article 1 of the same decree.

4. When reference is made in this Chapter to provisions of the decree [implementing Directive 2014/59/EU]341, the provisions referring to banks are understood as referring to investment companies and those referring to the parent company are understood as referring to the company at the head of the group pursuant to article 11.

Article 60-bis.2
Winding up plans

1. The Bank of Italy, after consulting Consob for the aspects of its competence, prepares:

a) an individual winding up plan for each investment company not subject to surveillance on a consolidated basis as contemplated by article 7 of the decree [implementing Directive 2014/59/EU]342; or

b) a winding up plan for the groups indicated by article 11, as contemplated by articles 8, 9 and 10 of the decree [implementing Directive 2014/59/EU]343.

2. The winding up plans are communicated to Consob.

3. Title III, Chapter I, of the decree [implementing Directive 2014/59/EU]344 and the provisions referred to therein are applied as far as applicable.

Article 60-bis.3
Winding-up possibility

1. The Bank of Italy assesses whether an investment company not belonging to a group can be wound up as contemplated by article 12 of the decree [implementing Directive 2014/59/EU]345 and by the provisions referred to therein.

2. The Bank of Italy assesses whether a group identified pursuant to article 11 can be wound up, when it is the authority for group winding up, in the cases and as contemplated by article 13 of the Decree [implementing Directive 2014/59/EU]346 and by the provisions referred to therein.

3. If, subsequent to the assessments carried out pursuant to paragraphs 1 and 2, substantial impediments are found against the winding-up of an investment company or a group, the Bank of Italy proceeds as contemplated by articles 14, 15 and 16 of the decree [implementing Directive 2014/59/EU]347, adopting, when opportune, the measures disciplined therein, after hearing Consob for the aspects of its competence.

Article 60-bis.4
Winding up and other crisis management procedures

1. Investment companies are subject to Titles IV and VI and to articles 99, 102, 103, 104 and 105 of the Decree [implementing Directive 2014/59/EU]348. The provisions indicated under article 20 of the same legislative decree, which indicate the reduction or the conversion of shares, of other stakes and capital instruments, or the start-up of the enforced administrative winding up or liquidation are adopted after consulting Consob for the aspects of its competence.

2. For the purposes of paragraph 1, the references contained in the decree [implementing Directive 2014/59/EU]349 to the discipline on the purchase of qualified participation, extraordinary administration and enforced administrative liquidation contemplated by the Consolidated Act on Banking are understood as carried out under the corresponding provisions of this Legislative Decree.

PART III
REGULATION OF MARKETS AND CENTRAL DEPOSITORIES FOR FINANCIAL INSTRUMENTS

TITLE I
REGULATION OF MARKETS

Chapter I
Regulated markets

Article 60-ter
Regulation principles

1. The Bank of Italy and Consob shall exercise the regulatory powers envisaged in this Title in observance of the principles pursuant to article 6, subsection 1350.

Article 61
Regulated markets for financial instruments

1. The organisation and management of regulated markets for financial instruments is an entrepreneurial activity and shall be performed by società per azioni, which may also operate on a non-profit basis (stock exchange companies).

2. Consob shall lay down in a regulation:

a) the financial resources of the management company351;

b) the activities related and instrumental to the organisation and management of markets which may be performed by stock exchange companies352.

3. The Minister of Economy and Finance, after consulting Consob, determines by regulation, the requirements of integrity, professionalism and independence of the persons performing administrative, management and control functions in management companies, pursuant to Article 13. The lack of the requirements shall result in disqualification from office. It is declared by the board of directors, the supervisory board or the management board within thirty days of the appointment or knowledge of the supervening defect. In the case of lack of action, the removal from office is pronounced by Consob353.

4. The regulation referred to in subsection 3 shall establish the grounds for temporary suspension from office and its duration. The suspension shall be declared in the manner established in subsection 3.

5. The Minister of the Economy and Finance,354 after consulting Consob, shall issue a regulation establishing the integrity requirements for shareholders.355

6. Acquisitions and disposals of shareholdings in stock exchange companies, whether effected directly or indirectly through subsidiary companies, trust companies or nominees, must be notified by the acquirer to Consob and the stock exchange company within 24 hours, together with documentation certifying that the acquirer satisfies the requirements referred to in subsection 5356.

6-bis. Consob shall regulate:

a) the content, terms and methods for reports to Consob by stock exchange companies on information relating to shareholders, identifying the significant shareholding threshold for this purpose and with regard to the possession of integrity requirements pursuant to subsection 5 and reports pursuant to subsection 6;

b) the content, terms and methods for reports to Consob by stock exchange companies on information relating to persons performing administrative, management and audit duties for the management company and to persons effectively managing regulated market activities and operations, and any subsequent changes;

c) the content, terms and methods of publication by stock exchange companies of information relating to shareholders and any subsequent change in the identity of persons with a significant shareholding357.

6-ter. The provisions of subsection 6-bis shall be adopted by the Ministry of Economy and Finance, after consulting the Bank of Italy and Consob, in cases of regulated stock exchange companies for the wholesale trading of government securities, and by Consob, after consulting the Bank of Italy, in cases of management of regulated markets for the wholesale trading of private and public bonds, other than government securities, together with the regulated stock exchange companies for instruments pursuant to article 1, subsection 2, paragraph b) and derivatives on public securities, interest rates and currency358.

7. Failure to satisfy such requirements or to provide notification shall preclude the exercise of the voting rights attached to the shares in excess of the limit referred to in subsection 6-bis359.

8. In the event of non-compliance with the prohibition referred to in paragraph 7, Article 14(5) shall apply. The challenge may also be initiated by Consob within the time limit established in Article 14(6).

8-bis. Within 90 days of notification by the management company, Consob may oppose changes to the ownership structure when such changes could compromise the sound and prudent management of the market. For wholesale markets of government securities the provision shall be adopted by the Bank of Italy. In cases of opposition from the competent authority, voting rights on shares subject to disposal may not be exercised360.

8-ter. The provisions of subsection 8-bis shall be adopted after consulting the Bank of Italy in cases of regulated stock exchange companies for the wholesale trading of private and public bonds, other than government securities, together with regulated stock exchange companies for instruments pursuant to article 1, subsection 2, paragraph b) and derivatives on public securities, interest rates and currency361.

9. Part IV, Title III, Chapter II, Section VI, except for Articles 157 and 158362.

10. The Minister of the Economy and Finance,363 after consulting the Bank of Italy and Consob, shall specify the characteristics of wholesale trading of financial instruments with a view to application of the provisions of this decree364.

Article 62
Market rules

1. The organisation and management of a market shall be governed by rules approved by the ordinary shareholders' meeting or supervisory board of the stock exchange company. The rules may assign powers to establish implementing provisions to the board of directors or management council365.

1-bis. If the shares of the stock exchange company are listed on a regulated market, the rules referred to in subsection 1 shall be approved by the company’s board of directors or management council.366

1-ter. In compliance with the provisions of Directive 2004/39/EC and related enactment measures, Consob shall identify and regulate the general criteria to which market regulation must adapt on matters of:

a) admission to trading of financial instruments;

b) Suspension and exclusion from trading of financial instruments on regulated markets;

c) methods to guarantee advertising of market regulation367.

1-quarter The provisions of subsection 1-ter shall be adopted after consulting the Bank of Italy in cases of markets for the wholesale trading of private and public bonds, other than government securities, together with markets for the trading of instruments pursuant to article 1, subsection 2, paragraph b) and derivatives on public securities, interest rates and currency368.

2. Stock exchange companies shall adopt transparent, non-discretional rules and procedures to guarantee correct and orderly trading, and objective criteria to allow the efficient execution of orders. In any event, market regulation shall determine369:

a) the conditions and procedures for the admission, exclusion and suspension of intermediaries and financial instruments to and from trading370;

a-bis) the conditions and procedures for admission to the listing, and those relative to admission for the trading of the financial instruments and relative to their exclusion and suspension from listing and from trading371;

b) the conditions and procedures for the conduct of trading and any obligations of intermediaries and issuers;

c) the procedures for ascertaining, publishing and distributing prices;

d) the types of contract admissible and the methods for determining the minimum amounts which may be traded.

d-bis) the terms and conditions for the clearance, settlement and guarantee of transactions concluded on the markets372.

2-bis. The rules may lay down that the shares of parent companies whose assets consist primarily of direct or indirect shareholdings in one or more companies with shares listed on regulated markets are to be traded in a separate segment of the market.373

3. Regulations pursuant to subsection 1 shall govern the access of operators to the regulated market, in accordance with transparent, non-discriminatory rules and based on objective criteria, together with criteria for the direct or remote participation in a regulated market and obligations imposed upon operators deriving from:

a) the establishment and management of the regulated market;

b) provisions regarding the transactions executed on the market;

c) the professional standards imposed upon persons pursuant to article 25, subsection 1 operating on the market;

d) the conditions established for participants other than persons referred to in paragraph c) pursuant to article 25, subsection 2;

e) the rules and procedures for clearance and liquidation of transactions concluded on the regulated market374.

3-bis. Consob shall lay down in a regulation:

a) the rules concerning accounting transparency and adequate organisational structure and internal control mechanisms that subsidiaries set up under and governed by the laws of non-EU countries must comply with for the shares of the parent company to be listable on an Italian regulated market. The notion of control defined in Article 93 shall apply;

b) the conditions whose existence precludes the listing of shares of subsidiaries subject to the activity of direction and coordination of another company;

c) the transparency rules and the restrictions on the admission to listing on the Italian securities market of financial companies whose assets consist exclusively of shareholdings.375

Article 63
Authorisation of regulated markets

1. Consob shall authorise the operation of regulated markets where:

a) the requirements referred to in Article 61(2-5) are satisfied;

b) the market rules are in conformity with Community law and sufficient to ensure the transparency of the market, the orderly conduct of trading and the protection of investors.

1-bis. Authorisation pursuant to subsection 1 shall be subordinate to the submission of a plan of activities illustrating the type of activities planned and the organisational structure of the management company376.

2. Consob shall enter regulated markets in a register, complying with Community provisions in this field, and shall approve amendments to market rules.

3. The measures referred to in subsections 1 and 2 shall be adopted, after consulting the Bank of Italy, for markets for the wholesale trading of private and public debt securities other than government securities, as well as for markets for the trading of instruments referred to in Article 1(2) paragraph b) and financial derivatives based on public securities, interest rates and currencies377.

4. The Bank of Italy shall be admitted to trading in markets for standardized forward contracts on government securities.

Article 64
Organisation and operation of markets and stock exchange companies 378

01. By its own regulation, Consob shall identify the reporting obligations of stock exchange companies to Consob and, with regard to transparency, the orderly conduct of trading and investor protection and, in compliance with the provisions of Directive 2004/39/EC, the general organisational requirements of the regulated stock exchange companies379.

1. A stock exchange company shall:

a) provide the structures and services of the market and establish its charge schedule;

b) adopt all the measures required for the efficient operation of the market, and arrange and maintain effective devices and procedures for the control and observance of the regulation380;

b-bis) adopt all the provisions and measures required to prevent and identify insider trading and market manipulation;381

c) admit, exclude and suspend financial instruments from listing and from trading and market participants to and from trading and immediately inform Consob about the decisions taken; implementation of decisions taken for trading ordinary shares, bonds and other financial instruments issued by people or bodies other than those of Member States of the European Union, of Community banks and of companies having shares listed on a regulated market, including exclusion decisions of shares from trading is suspended until the time specified in subsection 1-bis, paragraph a); this suspension is not applied in the case of admission to trading of financial instruments admitted under the exemption rule from the obligation to publish the prospectus as well as admission of supplementary lots of shares already admitted to trading; 382

d) notify Consob of violations of the market rules and the measures adopted.

e) …omissis…383;

f) perform any other tasks that may be entrusted to it by Consob.

1-bis. Consob:

a) can forbid the implementation of admission to trading and the exclusion from trading as per subsection 1, paragraph c), second period or order to revoke a suspension decision for financial instruments and trading operators, within five days from receiving the communication as per subsection 1, paragraph c), if, on the basis of the information different to the ones assessed, according to market regulations, by the management company during its investigation, considers the decision being against the aims as per Article 74, subsection 1384.;

b) may request the stock exchange company to provide all the inform it considers necessary for the purposes of paragraph a);

c) may request the stock exchange company to suspend financial instruments or intermediaries from trading385.

1-ter. The admission, exclusion and suspension from listing and and from trading of financial instruments issued by a stock exchange company on a market that it manages shall be decided by Consob. In such cases Consob shall determine the amendments to be made to the market rules to ensure transparency, orderly trading and the protection of investors and to regulate possible conflicts of interest. The admission of such financial instruments shall be subject to the amendment of the rules of the relevant market. 386

1-quater. Where a financial instrument is traded on regulated markets pursuant to article 67, subsection 1, Consob shall:

a) make public any decisions made pursuant to subsection 1-bis, paragraph c) and inform the competent authorities of EU member states of the regulated markets on which the financial instrument relating to the decision is admitted for trading;

b) inform the competent authorities of other EU member states of the decision to suspend or exclude a financial instrument from trading, based on the report received from the management company pursuant to subsection 1, paragraph c)387.

1-quinquies. The provisions of subsection 01 shall be adopted after consulting the Bank of Italy in cases of regulated stock exchange companies for the wholesale trading of private and public bonds, other than government securities, together with regulated stock exchange companies for instruments pursuant to article 1, subsection 2, paragraph b) and derivatives on public securities, interest rates and currency. 388

1-sexies. Unless damage may be caused to the interests of investors or to regular market operations, Consob shall request the suspension or exclusion of a financial instrument from trading on a regulated market in cases where said financial instrument was subject to a suspension or exclusion measure by the competent authorities of other EU member states389.

Article 65
Recording of transactions in financial instruments at the stock exchange company and obligations of communication of transactions in financial instruments concluded

1. Consob shall lay down in a regulation:

a) the manner of recording at the stock exchange company of all transactions concluded on financial instruments admitted to trading in a regulated market;

b) the content, terms and manner in which persons authorised to carry out the transactions concluded regarding financial instruments admitted to trading in a regulated market shall report such transactions.

2. Where necessary in order to guarantee investor protection, Consob may also extend reporting obligations pursuant to subsection 1, paragraph b) to financial instruments not admitted to trading on regulated markets390.

Article 66
Wholesale markets in government securities

1. Also by way of derogation from the provisions of this chapter, the Minister of the Economy and Finance,391 after consulting the Bank of Italy and Consob, shall regulate and authorise wholesale markets for government securities and shall approve their rules392.

2. The Bank of Italy shall be admitted to trading in wholesale markets in government securities. The Ministry of the Economy and Finance393 shall be admitted to trading in wholesale markets in government securities; it shall notify the Bank of Italy in advance of the timing and manner of its interventions. Within twenty-four hours of the notification, the Bank of Italy may make a reasoned request for interventions to be postponed or carried out in a different manner in order to safeguard monetary stability. The measures issued pursuant to subsection 1 may also provide for the admission to trading of persons other than intermediaries authorised to engage in trading394.

Article 66-bis
Energy and gas derivatives markets

1. The provisions of this Chapter, except where indicated in the subsections below, shall apply to regulated markets for the trading of energy and gas derivatives and to companies operating such markets.

2. The provisions of articles 61, subsections 8 and 8-bis, 63, subsections 1 and 2, 67, subsections 2, 3, 5-bis and 5-ter, 70-bis, subsection 2, paragraph b), 70-ter, subsection 2, 73, subsection 4, and 75, subsections 2 and 4, shall be adopted by Consob, in agreement with the electricity and gas boards.

3. The provisions of article 62, subsection 1-ter shall be adopted by Consob after consulting the electricity and gas boards.

4. The provisions of article 64, subsection 1-bis paragraph c) shall be adopted by Consob after consulting the electricity and gas boards.

5. The provisions of article 67, subsection 2-bis shall be attributed to Consob after consulting the electricity and gas boards.

6. The electricity and gas boards shall exercise powers granted under this article with regard to general needs of stability, economics and competitiveness of electricity and gas markets, and the safe, efficient operation of national electricity and gas transportation networks.

7. In the exercise of duties envisaged under this article, Consob and the electricity and gas boards shall interactively provide mutual support and cooperation also by means of exchange of information, without objection on the grounds of official secrecy. Consob and the electricity and gas boards shall act in a coordinated manner, for this purpose stipulating special memoranda of understanding.

8. The electricity and gas boards shall inform the Ministry of Economic Development of supervisory activities performed and on irregularities discovered that could have an impact on the operations of physical markets for the underlying products and on the safe and efficient operation of national electricity and gas transportation networks395.

Article 67
Recognition of markets

1. Consob shall enter markets recognized pursuant to Community law in a special section of the register referred to in Article 63(2).

2. Consob, after concluding agreements with the corresponding authorities, may recognize foreign markets for financial instruments other than those entered in the section referred to in subsection 1, for the purpose of extending the scope of their operations to Italy.

2-bis. In order to guarantee transparency, the orderly conduct of trading and the protection of investors, Consob shall stipulate agreements with the supervisory authorities of the home state of EU regulated markets that, in the opinion of Consob, have gained considerable importance in the operation of the Italian financial market and on the protection of investors in Italy. For wholesale markets of government securities such tasks shall be performed by the Bank of Italy396.

3. Stock exchange companies that intend to apply to the authorities of non-EU countries for recognition of the markets they manage shall notify Consob, which shall grant its authorisation after concluding agreements with the corresponding foreign authorities. For wholesale markets of government securities the Bank of Italy shall be notified, which will then release its authorisation subject to the stipulation of agreements with the foreign authorities and inform Consob accordingly397.

4. In cases pursuant to subsections 2 and 3, Consob or the Bank of Italy, according to their respective duties, shall verify that the information regarding securities and issuers, the methods of forming prices and settling transactions, and the laws and regulations governing the supervision of markets and intermediaries are equivalent to those in force in Italy and in any case able to ensure adequate protection of investors398.

5. Stock exchange companies that intend to extend operations of the regulated markets managed to other EU member states shall issue prior notification to Consob. With respect to European regulations, Consob shall inform the competent authority of the EU member state in which the regulated market intends to operate. For wholesale markets of government securities the prior notification is issued to the Bank of Italy, which shall inform the competent authority of the EU member state concerned and Consob399.

5-bis. Consob shall authorise the markets pursuant to subsection 1 to arrange appropriate devices to facilitate access to trading on such markets by their remote members and participants established in Italy400.

5-ter. Consob may request the identity of members or participants of the regulated market established in Italy from the competent authority of the home member state pursuant to subsection 5-bis401.

5-quater. For remote participants in Italian regulated markets, articles 8 subsection 1 and 10 subsection 1 shall apply. In this case, Consob shall inform the competent authority of the home member state of the remote participant. For wholesale markets of government securities, the Bank of Italy shall inform the competent authority of the EU member state of the remote participant and Consob402.

Article 68
Contract guarantee systems

1. The Bank of Italy, in agreement with Consob, may regulate the establishment and operation of systems designed to ensure the success of transactions in financial instruments other than derivatives carried out on regulated markets, including the issue of rules on the establishment of guarantee funds financed with contributions from their investors403.

2. The capital of each fund shall be kept separate from that of the body that administers it and from that of other funds. Funds may not be the object of actions, seizures or attachments by the creditors of the body administering them or creditors of the individual participants or in the interests of such creditors. Funds may not be included in bankruptcy proceedings involving the body administering them or the individual participants. Legal and judicial set-off shall not apply and voluntary set-off shall not be allowed between credit balances in the deposit accounts of the funds and any debts that the administrator of the funds may have with the depositary.

Article 69
Liquidation of transactions on non-derivative financial instruments404

1. The Bank of Italy, in agreement with Consob, shall regulate the functioning of the liquidation services for transactions involving financial instruments other than derivatives, including the establishment of time limits and preliminary and supplementary duties. Such regulations may provide that the liquidation services, excluding final settlement of the cash portion of transactions, to be managed by a company authorised by the Bank of Italy in agreement with Consob405. For the transfer of registered securities, including those other than shares, final endorsement may be effected in accordance with Articles 15(1) and 15(3) of Royal Decree no. 239 of 29 March 1942. Article 80, subsections 4, 5, 6, 7, 8 and 10 shall apply406.

1-bis. The Bank of Italy, in agreement with Consob, shall determine:

a) the financial resources of the management company;

b) the activities connected with and instrumental to those of liquidation;;

c) the company’s organisation requirements;

d) general criteria for the admission, exclusion and suspension of participants;

e) the general criteria on the basis of which the management companies may participate directly in the foreign liquidation systems 407.

1-ter. Access to to the liquidation services for transactions on non-derivative financial instruments shall be subordinate to non-discriminatory, transparent and objective criteria408.

2. The Bank of Italy, in accordance with Consob, may discipline the institution and functioning of systems aimed at guaranteeing the settlement of the liquidation of the transactions referred to in section 1, also issuing provisions concerning the constitution and administration of guarantee funds supplied by payments made by the participants409.

3. Article 68(2) shall apply to the guarantee funds referred to in subsection 2.

Article 69-bis
Authorisation and supervision of the central counterparties

1. The Bank of Italy authorises the performance of the clearance services in the capacity of central counterparty on the part of legal entities established in Italy, pursuant to articles 14 and 15 and according to the procedure contemplated by article 17 of Regulation (EU) no. 648/2012. The same authority revokes the authorisation to perform services on the part of a central counterparty in the case of the conditions indicated in article 20 of the said regulation. Article 80, sections 4, 5 and 10, and article 83 of this Legislative Decree are applied.

2. Bank of Italy, in the capacity of chairman of the authorisation board contemplated by article 18 of the regulation referred to by section 1, may refer the question of the adoption of a common negative opinion on the authorisation of a central counterparty to the ESMA, as contemplated by article 17, paragraph 4, of the same regulation, interrupting the terms for the authorisation procedure.

3. The supervision of the central counterparties is exercised by the Bank of Italy, taking into account the stability and the limitation of the systemic risk, and by Consob in respect of transparency and the protection of the investors. For this purpose, the Bank of Italy and Consob may request the central counterparties and the operators for the communication, also periodically, of data, news, deeds and documents, and may carry out inspections. The procedures for the exercise of the powers of supervision of information are disciplined by the regulation adopted by the Bank of Italy, in accordance with Consob; pursuant to the same regulation, additional requisites may be established for the exercise of the central counterparty services, in conformity with the regulation referred to in section 1.

4. In the case of need and urgency, the Bank of Italy, for the purposes attributed pursuant to section 3, adopts the necessary provisions also taking the place of the central counterparties. The provisions adopted are immediately communicated by the Bank of Italy to Consob, ESMA, the authorisation board referred to in section 2, the relevant authorities of the European System of Central Banks and the other authorities concerned, pursuant to article 24 of the regulation referred to in section 1.

5. The Bank of Italy carries out the duties specifically indicated in articles 41, paragraph 2, 49, paragraph 1, and 54, paragraph 1, of the regulation referred to by section 1, and, in accordance with Consob, adopts the provisions requested pursuant to articles 7, paragraph 4, 31, paragraphs 1 and 2, and 35, paragraph 1, of the same regulation. Article 80, sections 6, 7 and 8, of this Legislative Decree are applied.

6. Consob, in accordance with the Bank of Italy, adopts the provisions pursuant to article 8, paragraph 4, of the regulation referred to in section 1.

7. Unless otherwise specified by this article, the duties contemplated by the regulation referred to in section 1 on the supervision of central counterparties, are exercised by the Bank of Italy and Consob, each within the sphere of its own attributed powers.

8. The Bank of Italy and Consob, by a memorandum of understanding, establish the cooperation procedures for the performance of their respective duties, with particular reference to the positions represented within the sphere of the boards and for the management of emergency situations, as well as the procedures for the reciprocal exchange of relevant information, also regarding the irregularities reported and the provisions adopted in the exercise of their respective functions, taking into account the need to reduce to a minimum the charges bearing on the operators and the economics of the action of the supervisory authority. The memorandum of understanding is rendered public by the Bank of Italy and Consob in the manner established by the same410

Article 70
Guarantees acquired in the exercise of the central counterparty's activity

1. The margins and the other performances acquired by a central counterparty as guarantee for fulfilment of the obligations deriving from the clearance activity carried out in favour of its own participants cannot be subject to executive or precautionary actions on the part of the creditors of the single participants or of the subject which manages the central counterparty, also in the case of the opening of insolvency procedures. The guarantees acquired may be used only as contemplated by Regulation (EU) no. 648/2012411.

Article 70-bis 412
Access to the central counterparties and to the settlement systems of the transactions on financial instruments 413

1. The investment companies and the Community banks authorised to perform investment services or activities may have access to the central counterparties and the systems referred to in articles 68 and 69, to finalise or to order the finalisation of the transactions on financial instruments414.

2. The management company shall guarantee the right of participants in the markets regulated to designate a clearing and settlement system for transactions on financial instruments executed on said markets, other than that designated by the market, provided the following conditions are observed:

a) links and devices exist between the designated clearing and settlement system and the regulated market structure to guarantee effective and economic transactions;

b) recognition by Consob that the technical conditions for the settlement of transactions concluded on a regulated market through a system other than that designated by the market allow regular and orderly market operations. In cases of regulated stock exchange companies for the wholesale trading of government securities, said recognition is confirmed by the Bank of Italy.

3. Stock exchange companies shall inform Consob of the designations of market participants pursuant to subsection 2. Such notifications shall be issued to the Bank of Italy in the case of wholesale government security markets.

4. Recognition pursuant to subsection 2, paragraph b) shall be confirmed after consulting the Bank of Italy in cases of regulated stock exchange companies for the wholesale trading of private and public bonds, other than government securities, together with regulated stock exchange companies for instruments pursuant to article 1, subsection 2, paragraph d) and derivatives on public securities, interest rates and currency.

Article 70-ter 415
Agreements concluded with the management companies of the regulated markets with central counterparties or with liquidation service management companies416

1. The regulated market management companies may conclude agreements with the central counterparties or with the liquidation service management companies of another Member State in order to provide for the clearance of the liquidation of some or all the transactions concluded by the participants of the regulated market417.

2. In agreement with the Bank of Italy, Consob may oppose the agreements pursuant to subsection 1 if, when also taking into account the conditions envisaged in article 70-bis, subsection 2, this is necessary to preserve the orderly operation of the regulated market. For this purpose, in agreement with the Bank of Italy, Consob shall regulate the reporting obligations of stock exchange companies at the time of conclusion of the agreements pursuant to subsection 1418.

3. The measures pursuant to subsection 2 shall be adopted by the Bank of Italy, in agreement with Consob, for wholesale markets of government securities.

Article 71
Finality of settlement of transactions involving financial instruments

...omissis... 419

Article 72 420
Market insolvency regulations

1. By agreement with the Bank of Italy, Consob governs market insolvency of parties admitted for trading on regulated markets and in multilateral trading systems and of participants to the central counterparties, in the form of regulation, thereby establishing the basis, scope of application and methods of ascertainment and liquidation. Market insolvency is declared by Consob, by agreement with the Bank of Italy421.

2. Without prejudice to the provisions of paragraph 1, the opening by the competent legal or administrative authority of a liquidation procedure or the restoration of parties admitted to trading on regulated markets and in multilateral trading systems and of participants participants to the central counterparties, constitutes a basis for the declaration of market insolvency. For the purpose of this paragraph, the definitions of "restoration procedure" and "liquidation procedure" established by article 1 of Italian Legislative Decree no. 170 of 21 May 2004 shall apply422.

3. For the purpose of the declaration pursuant to paragraph 1, the competent legal or administrative authority shall immediately inform Consob and the Bank of Italy, also by telematic means, of the opening of liquidation or restoration proceedings of parties admitted for trading on regulated markets and in multilateral trading systems and of participants to the central counterparties423.

4. The liquidation of market insolvencies, including compliances established by paragraph 6, may be carried out by the management companies established by article 61, paragraph 1 for contracts stipulated in the markets it manages, and by the central counterparties and the managers of the systems contemplated by article 77-bis, respectively for the transactions they guarantee and for the contracts stipulated in the systems they manage, and by other parties, in compliance with the provisions contained in the regulation established by paragraph 1. The costs for managing the liquidation of market insolvencies are borne by the parties managing the markets or systems in which the insolvent party has operated424.

5. For the purpose of liquidating market insolvencies, the management companies established by article 61, paragraph 1, the central counterparties, the managers contemplated by article 77-bis and all other parties may provide for close-out netting clauses for contracts and transactions established by paragraph 4. Such clauses shall be valid and take effect in compliance with their provisions, also in the event of the opening of restoration or liquidation proceedings with regards to the market insolvent party. For the purpose of this paragraph, the definitions of "close-out netting clause", "restoration procedure" and "liquidation procedure" established by article 1 of Italian Legislative Decree no. 170 of 21 May 2004 shall apply, also for lack of financial guarantees.425

6. The procedure for liquidating market insolvency concludes with the issue to assignees, for the residual credits, of a credit certificate, inclusive of costs sustained by the creditor. This shall constitute executive title with regards to the insolvent party for the effects of article 474 of the Italian Code of Civil Procedure.

7. Where criteria is met, the implementation provisions of Directive 98/26/EC of the European Parliament and Council of 19 May 1998 in relation to the definitive nature of the regulation of payment systems and security regulation system shall apply to the liquidation of market insolvencies.

Article 73
Supervision of stock exchange companies

1. Stock exchange companies shall be subject to supervision by Consob, which for this purpose shall exercise the powers conferred by articles 74, subsection 2, and 187-octies426.

2. Consob shall enter stock exchange companies in a register.

3. Consob shall verify that amendments to the Articles of Association of stock exchange companies do not conflict with the requirements referred to in Article 61. Procedures for entry in the Company Register may not be initiated in the absence of such verification.

4. Consob shall check that market rules are suitable to ensure that market transparency, orderly trading, and investor protection are effectively achieved and may require stock exchange companies to amend market rules to eliminate any problems it finds 427.

Article 74
Supervision of markets

1. Consob shall supervise regulated markets with the aim of ensuring the transparency of the market, the orderly conduct of trading and the protection of investors, and may adopt any measure to guarantee observance of the obligations envisaged in this Chapter. For this purpose, for operators permitted to trade on regulated markets, other than authorised persons, articles 8 subsection 1 and 10 subsection 1 shall apply428.

1-bis. Consob shall check stock exchange companies’ compliance with the market rules for financial instruments referred to in Article 64(1-ter).429

2. Consob may require stock exchange companies to communicate data and information and to transmit documents and records on a periodic or other basis in the manner and within its established time limits; it may also carry out inspections of such companies and require the exhibition of documents and the adoption of measures deemed necessary430.

3. In cases of necessity and as a matter of urgency Consob shall adopt the measures required for the purposes referred to in subsection 1, including its acting in the place of the stock exchange company.

4. The measures referred to in subsection 3 may be adopted by the Chairman of Consob or his substitute in the event of his absence or disability to act. They shall be immediately enforceable and submitted to the Commission for it to approve within five days, the effect of such measures shall cease if they are not approved within this time limit.

4-bis. Consob may exercise additional powers pursuant to article 187-octies431.

Article 75
Extraordinary measures to protect the market and stock exchange company crises

1. In the event of serious irregularities in the management of markets or in the administration of stock exchange companies and wherever it is necessary for the protection of investors, the Ministry of the Economy and Finance,432 acting on a proposal from Consob, shall dissolve the administrative and control bodies of the stock exchange company. The powers of the dissolved administrative bodies shall be conferred on a special administrator appointed in the same decree, who shall exercise them, in accordance with directives issued by Consob and under its control, until the administrative bodies are reconstituted. The emoluments due to the special administrator shall be determined with a decree of the Ministry and shall be charged to the stock exchange company. Where not otherwise provided for in this subsection, Article 70(2-6), Article 72, except for subsections 2 and 8, and Article 75 of the Consolidated Law on Banking shall apply, with Consob being assigned the powers attributed therein to the Bank of Italy.

2. Consob may cancel the authorisation pursuant to article 63 when:

a) the management company fails to make use of the authorisation within twelve months or expressly waives the use thereof;

b) the management company or regulated market ceased to operate more than six months previously;

c) the management company obtained authorisation through false declaration or any other irregular means;

d) the management company or regulated market no longer satisfies the conditions required for the authorisation;

e) the management company has seriously and systematically violated the provisions of this Chapter433.

2-bis. The procedures pursuant to subsection 1 may determine cancellation of the authorisation referred to in subsection 2434.

3. Within thirty days of the notification of the order revoking authorisation, the directors or the special administrator shall call the shareholders' meeting to modify the corporate purpose or adopt a resolution for the voluntary liquidation of the company. Where the meeting is not called within such time limit or the meeting does not adopt the resolution within three months of the notification of the revocation order, the Ministry of the Economy and Finance,435 acting on a proposal from Consob, may dissolve the stock exchange company and appoint liquidators. The provisions concerning the liquidation of società per azioni shall apply, except for those concerning the revocation of liquidators.

4. In the cases referred to in subsections 1 and 2, Consob shall promote the agreements needed to ensure the continuity of trading. For this purpose it may arrange for the temporary transfer of the management of the market to another company, subject to that company's consent. The definitive transfer of the management of the market may be effected by way of derogation from Title II, Chapter VI, of the Bankruptcy Law.

5. The proposals referred to in the previous subsections shall be formulated by Consob, after consulting the Bank of Italy, for stock exchange companies of markets for wholesale trading of private and public sector bonds other than government securities and markets for the trading of instruments referred to in Article l(2) paragraph b), and financial derivatives based on government securities, interest rates and foreign currencies436.

6. Actions for the purpose of initiating bankruptcy proceedings, compositions with creditors or controlled administration and the related measures adopted by the court shall be notified to Consob within three days by the clerk of the court.

Article 76
Supervision of wholesale markets in government securities

1. Without prejudice to the responsibilities of Consob set out in this decree, the Bank of Italy shall supervise the wholesale markets in government securities, having regard to the overall efficiency of the market and the orderly conduct of trading. For operators permitted to trade on markets for the wholesale trading of government securities, other than authorised persons, articles 8 subsection 1 and 10 subsection 1 shall apply437.

2-bis. The Bank of Italy, under the terms and conditions it has established, may request data, information, records and documents from the stock exchange companies, may perform inspections on the companies, may request sight of documents and complete records as deemed necessary. Said powers may also be exercised with regard to other persons involved in the management company activities. For this purpose, the Bank of Italy may also call personal hearings. The Bank of Italy may authorise auditors or technical experts to perform inspections of the management company. Any related costs shall be borne by the company inspected438.

2-ter. In cases of need and emergency, for the purposes of subsection 1, the Bank of Italy shall adopt any necessary measures, including replacement of the management company439.

2-quater. For wholesale markets for government securities, Consob may exercise the powers pursuant to article 187-octies440.

2. The Bank of Italy shall supervise the stock exchange companies of the wholesale markets in government securities; for this purpose it shall exercise the powers conferred in Article 74(2).

3. Article 75 shall apply. The Bank of Italy shall have the powers and duties attributed therein to Consob.

Article 77 441
Supervision of the contracts and liquidation guarantee systems 442

1. The supervision of the systems indicated in articles 68 and 69 and of the subjects which manage the same is exercised by the Bank of Italy, taking into account the stability and the limitation of the systemic risk, and by Consob in respect of transparency and the protection of the investors. For this purpose, the Bank of Italy and Consob may request the system managers and the operators for the communication, also periodically, of data, news, deeds and documents on the liquidation and guarantee of the transactions, and may carry out inspections443.

2. In cases of necessity and as a matter of urgency, for the purposes referred to in subsection 1, the Bank of Italy shall adopt appropriate measures, including its acting in the place of the managers of of the services indicated in article 69444.

3. For managers of the systems and services pursuant to articles 68 and 69, article 83 shall apply445.

Chapter II
Unregulated markets446

Article 77-bis 447
Multilateral trading systems

1. By its own regulation, Consob shall identify the minimum operating requirements for multilateral trading systems, including obligations of their managers with regard to:

a) the trading and finalisation processes of transactions;

b) the admission of financial instruments;

c) information provided to the public and to users;

d) access to the system;

e) monitoring of the observance of system rules by users448.

2. Consob:

a) may request managers of multilateral trading systems to exclude or suspend financial instruments from trading on said systems;

b) may request managers of multilateral trading systems for all information deemed useful for the purposes of paragraph a);

c) at the time of authorisation and continuously thereafter, shall supervise the rules and procedures adopted by multilateral trading systems to confirm their compliance with European provisions.

3. Unless damage may be caused to the interests of investors or to regular market operations, Consob shall request the suspension or exclusion of a financial instrument from trading on multilateral trading systems in cases where said financial instrument was admitted to trading on a regulated market and was subject to a suspension or exclusion measure by the competent authorities of other EU member states.

4. Article 70-ter, sections 1 and 2, is applied to the agreements concluded with the subjects which manage a multilateral trading system with the central counterparties or with the liquidation service management companies449.

5. For operators permitted to trade on markets for the wholesale trading of government securities, other than authorised persons, articles 8 subsection 1 and 10 subsection 1 shall apply.

6. The measures pursuant to subsection 1 shall be adopted by Consob, after consulting the Bank of Italy, with regard to systems for the wholesale trading of private and public bonds, other than government securities, securities normally traded on the money market, derivatives on public securities, interest rates and currency, and shall be adopted by the Ministry of Economy and Finance, after consulting the Bank of Italy and Consob, with regard to systems for the wholesale trading of government securities. For the latter, activities pursuant to subsections 2 and 3 shall be performed by the Bank of Italy, after consulting Consob.

Article 78
Systematic internalisers

1. Consob may request that systematic internalisers exclude or suspend from trading financial instruments admitted to trading on regulated markets for which they prove to be the systematic internalisers.

2. Consob shall regulate the criteria for identification of the systematic internalisers and their obligations with regard to the publication of listings, execution of orders and access to listings450.

Article 79
Multilateral systems for the exchange of money deposits in euro

1. The Bank of Italy shall supervise the efficiency and regular operations of multilateral systems for the exchange of money deposits in euro, and their managers.

2. The Bank of Italy, under the terms and conditions it has established, may also request periodic reports to include data, information, records and documents from managers and operators. The Bank of Italy may also perform inspections of said managers, request sight of documents and complete records as deemed necessary. Said powers may also be exercised with regard to other persons involved in the activities of the authorised person. For this purpose, the Bank of Italy may also call personal hearings. The Bank of Italy may authorise auditors or technical experts to perform inspections of said managers. Any related costs shall be borne by the person inspected.

3. Managers of multilateral systems for the exchange of money deposits in euro may also manage multilateral trading systems for derivatives on interest rates and currency.

4. For exchanges pursuant to subsection 1, article 77-bis shall not apply451.

Chapter II-bis452
Common provisions

Article 79-bis
Transparency requirements

1. In order to guarantee the effective integration of markets and stronger effectiveness of the price formation process, Consob shall regulate:

a) pre-trading transparency for transactions on shares admitted to trading on regulated markets and executed on said markets within multilateral trading systems and systematic internalisers;

b) post-trading transparency for transactions on shares admitted to trading on regulated markets and executed on said markets within multilateral trading systems and by authorised persons453.

2. Where necessary to guarantee orderly trading and investor protection, Consob may extend, wholly or in part, the pre- and post-trading transparency applicable to transactions on financial instruments other than shares admitted to trading on regulated markets.

3. The provisions pursuant to subsection 2 shall be adopted by Consob, after consulting the Bank of Italy, with regard to the wholesale trading of private and public bonds, other than government securities, securities normally traded on the money market, derivatives on public securities, interest rates and currency, and shall be adopted by the Ministry of Economy and Finance, after consulting the Bank of Italy and Consob, with regard to the wholesale trading of government securities454.

4. Consob shall regulate the management of customer limit orders on shares admitted to trading on a regulated market455.

Article 79-ter
Consolidation of information

1. In order to guarantee that market operators and investors may compare prices made public by regulated markets, multilateral trading systems and authorised persons in accordance with obligations, Consob, after consulting the Bank of Italy, may under its own regulation identify measures to eliminate impediments to the consolidation of information and related publication456.

TITLE II457
CENTRAL DEPOSITORY SYSTEM FOR FINANCIAL INSTRUMENTS

Article 79-quater
Definitions

1. For the purpose of this Title, “intermediaries” shall mean persons identified by the regulation referred to in Article 81 subsection 1, authorised to keep records of the registration of financial instruments and related transfers.

Chapter I
Regulations for central depositories

Article 80
Central depository activities in relation to financial instruments

1. Central depositories of financial instruments take the legal and operating format of a joint stock company, also as a non-profit organisation.

2. The sole corporate purpose of a central depository is to act as a central depository for financial instruments pursuant to Chapter II of this Title. Related and instrumental activities may also be performed.

3. By regulation and in agreement with the Bank of Italy, Consob shall establish the financial resources and organisational requirements of the companies and related and instrumental activities, which in any event shall not include representation at shareholders' meetings of listed joint-stock companies.

4. After consulting the Bank of Italy and Consob, the Minister of the Economy and Finance shall issue a regulation establishing the integrity, professionality and independence requirements of persons performing director, management and control duties in such companies, in accordance with the provisions of Article 13. The lack of the requirements shall result in disqualification from office. It is declared by the board of directors, the supervisory board or the management board within thirty days of the appointment or knowledge of the supervening defect. In the case of lack of action, the disqualification pronounced by the Bank of Italy or Consob458.

5. The regulation envisaged in subsection 4 shall establish the causes for temporary suspension from office and its duration. Subsection 4, sentences three and four, apply459.

6. By regulation adopted after consulting Consob and the Bank of Italy, the Minister of the Economy and Finance shall establish the integrity requirements of shareholders, identifying the investment threshold considered significant for this purpose.

7. The direct or indirect purchase and disposal of significant investments pursuant to subsection 6, also through subsidiaries, trusts or third parties, must be disclosed by the buyer to Consob, the Bank of Italy and the central depository within twenty-four hours, together with documents confirming the buyer’s possession of the requirements established pursuant to subsection 6.

8. Where such requirements are not possessed or in the event of non-disclosure, voting rights associated with shares exceeding the threshold established pursuant to subsection 6 may not be exercised. In the event of failure to comply with the prohibition, Article 14, subsections 5 and 6 shall apply.

9. In agreement with the Bank of Italy, Consob shall authorise the company to perform central depository activities for financial instruments when the requirements envisaged in subsections 1, 2, 3, 4, 5 and 6 are met, and the services regulation pursuant to Article 81, subsection 2 complies with the provisions of this Title and related enactment regulations.

10. Article 155 subsection 2, Article 156 subsection 4 and Article 159 subsection 1 shall apply to central depositories.

Article 81
Enactment regulation and service regulations

1. By regulation and in agreement with the Bank of Italy, Consob shall identify in order to assure the transparency of the centralised management system, the orderly provision of services and investor protection460:

a) the requirements that must be met by intermediaries and the activities envisaged under this Title that intermediaries are authorised to perform;

b) the financial instruments admitted to the central depository system;

c) the public distribution characteristics of financial instruments indicated under article 83-bis, subsection 2, for the purpose of their being subject to the provisions of this Title461;

d) the procedures and methods by which financial instruments are subject to or detracted from the provisions of this Title, depending on related requirements being met or ceasing to be met;

e) the minimum content necessary for the contract to be stipulated between the central depository and the issuer or intermediary;

f) the technical characteristics and content of the records and accounts opened with the central depository and the intermediary;

g) the formats and methods that central depositories must adopt for account and record keeping, in compliance with the principle of segregation of their own accounts from those in the name of individual intermediaries;

h) the formats and methods that intermediaries must adopt for account and record keeping, in compliance with the principle of segregation of their own accounts from those in the name of individual account holders;

i) the methods by which the central depository must guarantee constant correspondence between the balances of issuer accounts and intermediary accounts, and related disclosures;

l) the methods by which intermediaries must guarantee constant correspondence between the balances of their accounts held with the central depository and their own and customer accounts;

m) without prejudice to the provisions of article 83-sexies, subsection 4, the forms, models, terms, the intermediary responsible for issue and cancellation of certificates, and the issue and correction of disclosures envisaged, respectively, in Article 83-quinquies subsection 3 and Article 83-sexies462;

n) the criteria and methods for performing the activities specified in Article 83-octies;

o) the deadlines by which intermediaries and central depositories must comply with disclosure obligations to issuers of the names of entitled shareholders and registrations under the terms of Article 83-octies, pursuant to Article 83-novies, subsection 1, paragraphs d), e), f) and g), and Article 89, respectively;

o-bis) the terms and conditions of communication, on request, in cases and parties identified by the regulation itself, of the data identifying the principals of the financial instruments and the intermediaries holding them, without prejudice for the possibility for principals of financial instruments to specifically prohibit communication of their identification data and also without prejudice to the provisions of articles 83-duodecies for the financial instruments envisaged therein463;

p) additional provisions necessary for implementation of the provisions of this Title and others in any event required to pursue the purposes indicated in the first part of this subsection464.

2. The central depository shall adopt a services regulation indicating the services provided, the provision methods, criteria for admission to the central depository of persons and financial instruments, based on non-discriminatory, transparent and objective criteria. The services regulation shall be approved by Consob in agreement with the Bank of Italy. Consob, in agreement with the Bank of Italy, may establish that the fees for services provided by central depositories and fees requested by intermediaries for the certification, disclosure and reporting services envisaged in Chapter II of this Title shall be subject to Consob approval.

2-bis. The regulation envisaged in subsection 1 may task the provisions for certain matters which, pursuant to subsection 1 or other provisions of this Title, delegate to Consob supervision exercised in agreement with the Bank of Italy, to the services regulation465.

Article 81-bis
Access to the central depository system

1. EU investment companies and banks authorised for investment services or activities may access the central depository system.

Article 82
Supervision

1. Supervision of the centralised management system shall be performed by Consob, in order to ensure transparency and investor protection, and by the Bank of Italy with regard to system stability and risk containment. Consob and the Bank of Italy may call upon such companies and the intermediary to submit data, information, papers and documents, also on a periodic basis, may perform inspections, request the exhibition of documents and that other action be taken as deemed necessary, indicating the related terms and conditions466.

2. Consob and the Bank of Italy shall perform monitoring until the services regulation of the central depository is suitable to ensure actual achievement of the objectives indicated in subsection 1, and may request that the company amends the services regulation in a manner appropriate to eliminating any malfunction encountered.

Article 83
Central depositories in crisis

1. Should serious irregularities be ascertained, on recommendation from Consob or the Bank of Italy and by decree published in the Official Gazette, the Ministry of the Economy and Finance may order that the boards of directors of central depositories be disbanded. By such a decree one or more special commissioners are appointed for administration of the company and the fees payable to such commissioners, borne by the company, are established. Article 70 subsections 2 to 6, Article 72 except subsections 2 and 8, and Article 75 of the Consolidated Law on Banking shall apply, the Bank of Italy’s powers being deemed attributed to the authority proposing the order.

1-bis. Should exceptionally serious irregularities be ascertained, in agreement with the Bank of Italy Consob may order cancellation of the authorisation referred to in Article 80, subsection 9.

2. If a central depository is declared insolvent pursuant to Article 195 of the Bankruptcy Act, or authorisation is cancelled pursuant to subsection 1-bis, the Minister of the Economy and Finance shall issue a decree ordering that the company be placed under compulsory administrative liquidation excluding bankruptcy, in accordance with the provisions of Article 80 subsections 3, 4, 5 and 6, Articles 81 to 83, Article 84 except subsection 2, and Articles 85 to 94 of the Consolidated Law on Banking, to the extent they may be compatible.

Chapter II
Central depository system regulations

Section I
Central depository system for dematerialisation

Article 83-bis
Scope of application

1. Financial instruments traded or due to be traded on Italian regulated markets may not be represented by documents467.

2. Based on their distribution among the public, the regulation referred to in Article 81, subsection 1 may also envisage that financial instruments without the characteristics indicated in subsection 1 be subject to the provisions of this section468.

3. The issuer of financial instruments may subject them to the provisions of this section.

Article 83-ter
Issue of financial instruments469

1. For each issue of financial instruments subject to the provisions of this section, a single central depository must be selected. This issue shall inform the central depository of the total value of the financial instruments issue, its composition and any other characteristics required under the regulation indicated in Article 81, subsection 1. For each issue the central depository system shall open an account in the name of the issuer.

Article 83-quater
Attributions of the management company and intermediary

1. Transfer of financial instruments subject to the provisions of this section, and the exercise of related ownership rights, may only be performed through intermediaries.

2. On request, the central depository shall open an account for each intermediary to record movements of the financial instruments deposited on that account.

3. For each financial instruments account holder, the intermediary, if appointed to perform this service, shall on each account – strictly separated by account holder and separate from any account in the intermediary's own name – record the financial instruments held, their transfer, the rights exercised and restrictions pursuant to Article 83-octies, as instructed by the owner or on their behalf. In all other circumstances the intermediary shall, for subsequent duties, inform the intermediary with whom the owner has opened an account of the transfer action taken. Registration of the transfers shall be performed by the intermediaries on settlement of the related transactions.

4. The registrations and disclosures prescribed by current regulations envisaging numeric identification of certificates shall indicate the type and quantity of instruments concerned.

Article 83-quinquies
Rights of the account holder

1. After registration, the account holder indicated in Article 83-quater, subsection 3 shall legitimately have full and exclusive exercise of rights pertaining to the financial instruments registered on that account, in accordance with their individual regulations and the provisions of this Title. The account holder may dispose of financial instruments registered to the account in compliance with current regulations on such matters.

2. Any person for whom registration is performed on his or her behalf, based on entitlement and in good faith, shall not liable for claims or action taken by previous owners.

3. Unless otherwise envisaged in Article 83-sexies, the legitimate exercise of rights indicated in subsection 1 shall be confirmed by showing the certificates issued by intermediaries in compliance with their account records, bearing an indication of the voting rights exercisable. Certificates shall not confer rights other than those legitimised as above. Disposition instructions given in relation to the aforementioned certificates shall be null and void.

4. Apart from the cases envisaged by article 2352, last subsection of the Italian Civil Code, there can be no more than one certificate may not be issued for the same financial instruments for the purpose of legitimising exercise of the same rights470.

Article 83-sexies 471
Right to attend shareholders' meetings and the exercise of voting rights

1. The legitimate attendance of shareholders' meetings and the exercise of voting rights is confirmed by a statement to the issuer from the intermediary, in compliance with intermediary accounting records, on behalf of the person with the right to vote.

2. For meetings of holders of financial instruments admitted for trading with the issuer's consent on regulated markets or in the Italian multilateral trading systems or those of other European Union countries, the communication contemplated by subsection 1 is made by the intermediary on the basis of the evidence of the accounts contemplated by article 83-quater, subsection 3, relative to the term of the accounting day of the seventh market business day prior to the date established for the meeting. Credit and debit entries made on accounts after these terms are not relevant in terms of assuring the legitimate exercise of voting rights at the shareholders' meeting. For the purposes of this ruling, the date of the first convocation is considered providing the dates of any successive convocations are indicated in the convocation notice; otherwise the date of each convocation shall be considered472.

3. For meetings other than those indicated in subsection 2, the articles of association may require the financial instruments referred to in the communication to be entered in the accounts of the party with voting rights as from a pre-established date, potentially establishing that they may not be transferred until the end of the shareholders' meeting. In the case of shareholders' meetings of companies whose shares are widely distributed to a relevant extent, the term may not exceed two working days. Should the Articles of Association not prevent the transfer of shares, any transfer of such shall entail the obligation bearing on the intermediary to rectify the communication sent previously473

4. Communications indicated in subsection 1 must reach the issuer by the third trading day prior to the date indicated in subsection 2, last sentence, or within an alternative term established, in concert with the Bank of Italy, by a Consob regulation, or within a successive term established in the Articles of Association pursuant to subsections 3 and 5. This is without prejudice to legitimate attendance and voting if communication has reached the issuer beyond the terms specified in this subsection, providing it has been received before the start of the works of the meeting works held pursuant to single convocation474.

5. Subsections 1, 3 and 4 apply to the meetings of holders of financial instruments issued by cooperative companies. With reference to meetings of holders of financial instruments admitted for trading, with the consent of the issuer, on regulated markets or Italian multilateral trading systems or those of other countries of the European Union, the terms pursuant to subsection 3 cannot exceed two working days475.

Article 83-septies
Opposable exceptions

1. On exercise of the rights attached to financial instruments by the person on whose behalf the registration was completed, he issuer may only oppose exceptions personal to the individual in question and those common to all other holders of the same rights.

Article 83-octies
Establishing restrictions

1. Restrictions of any kind on financial instruments governed by this section, including restrictions envisaged under special regulations on public debt securities, may be established only by registration in a special account held by the intermediary.

2. Specific accounts may be opened to allow restrictions to be established on all financial instruments registered to that account. In such cases the intermediary shall be responsible for complying with instructions received at the time the restriction is established in relation to preserving intact the value of the restriction and the exercise of rights attached to the financial instruments affected.

Article 83-novies
Duties of the intermediary

1. The intermediary:

a) in the name of and on behalf of the account holder, shall exercise rights attached to the financial instruments, provided the account holder has conferred mandate to do so;

b) at the request of the interested party, shall issue the certificates referred to in Article 83-quinquies, subsection 3, when necessary for the exercise of rights attached to the financial instruments;

c) at the request of the interested party, shall issue the statements envisaged in Article 83-sexies. The request may be made with reference to all shareholders’ meetings of one or more issuers, until otherwise instructed. In such cases, the intermediary shall make all due arrangements without the need for further statement issue requests;

d) shall inform the issuer of the names of persons requesting certificates envisaged in Article 83-quinquies, subsection 5, together with the names of persons that have received dividends and those who, exercising option rights or other rights, have acquired ownership of registered financial instruments, specifying the related quantity so that issuer obligations may be met;

e) at the request of the interested party or where envisaged under current regulations, shall also inform the issuer of the names of persons with rights on the financial instruments so that issuer obligations may be met;

f) if the persons with rights on the financial instruments are not the persons requesting certificates or are persons on whose behalf statements have been issued for attendance at shareholders' meetings, shall inform the issuer of the names of such persons so that issuer obligations may be met;

g) in cases in which statements pursuant to paragraph c) and reports pursuant to paragraphs d), e) and f) have been issued, notifies the issuer of the restrictions on financial instruments registered in accordance with article 83-octies476..

2. The deposit of certificates issued by the intermediary shall, to all effect and purpose of the law, replace deposit of the security as envisaged under current regulations.

3. The obligation to issue certificates shall also apply in reference to financial instruments not admitted to the central depository system pursuant to Chapter I and which are registered on intermediary accounts.

Article 83-decies
Intermediary liability

1. The intermediary shall be liable:

a) to the account holder for damages deriving from the transfer of financial instruments performed on the account holder’s behalf, for correct record-keeping and prompt compliance with obligations under the terms of this decree and the regulation referred to in Article 81, subsection 1;

b) to the issuer for compliance with disclosure and reporting obligations imposed by this decree and by the regulation referred to in Article 81, subsection 1.

Article 83-undecies
Issuer obligations

1. Issuers of shares update the shareholders' register in compliance with the communications and notifications made by the intermediaries in accordance with article 83-novies, subsection 1, letters b), c), d), e), f) and g), of article 83-duodecies and, in the event of the demand for proxies promoted by the issuer, in compliance with the communications made by the intermediaries in accordance with article 144, subsection 1, within thirty days of their receipt477.

2. Without prejudice to Article 2421 of the Civil Code, even if the shareholders’ register is not set up or maintained by electronic means, the results of that shareholders’ register shall be made available to shareholders, on request, also on electronic support media in a commercially-used format478.

3. Subsection 1 does not apply to cooperative companies479.

4. All of the above without prejudice to the provisions of Article 7, Law no. 1745 of 29 December 1962.

Article 83-duodecies
Shareholder identification

1. Where envisaged in the Articles of Association, Italian companies with shares admitted for trading with the consent of the issuer on regulated markets or multilateral trading systems in Italy or another European Union country, may ask,, may at any time and at their own expense call upon intermediaries – through a central depository – to provide data identifying shareholders that have not specifically denied consent to such disclosures, together with the number of shares registered on accounts in their names480.

2. The disclosures referred to in subsection 1 must reach the issuer within ten trading days of the date of the request, or other deadline established by Consob by regulation issued in agreement with the Bank of Italy481.

3. Where the Articles of Association envisage the option indicated in subsection 1, the company shall make the same request if asked to do so by a number of shareholders representing at least half the minimum investment established by Consob pursuant to Article 147-ter, subsection 1. The related costs shall be divided between the company and the shareholders concerned according to criteria established by Consob regulation, with due regard to the requirement not to encourage the use of this tool by shareholders for purposes not consistent with the aim of facilitating coordination between such shareholders for the exercise of rights calling for a professional investment482.

4. In accordance with the terms and conditions of Article 114, subsection 1, companies shall publish a disclosure confirming that a request for identification has been made, providing reasons if the request is made pursuant to subsection 1, or the identity and total investment of requesting shareholders for requests made pursuant to subsection 3. The data received shall be made available to shareholders on a commonly-used electronic storage device free of charge, without prejudice to the obligation to update the shareholders’ register483.

5. This article shall not apply to cooperatives.

Article 83-terdecies
Payment of dividends

1. As an exception to article 4 of Italian Law no. 1745 of 29 December 1962, the legitimate payment of profits and other distributions relating to the financial instruments registered in the accounts specified under article 83-quater, subsection 3, is determined with reference to the evidence of the accounts in relation to the end of the accounting day specified by the issuer, which also establishes the methods by which the related payment is made484.

Section II
Centralised management of securitised financial instruments
485

Article 85
Central deposits

1. Where financial instruments consigned to the central system are represented by documents, the performance and the effects of central depository activity shall be governed by this section. Unless otherwise envisaged in this section, Articles 83-ter to 83-undecies shall apply486.

2. The clause of the deposit contract concluded with intermediaries identified in the regulation pursuant to Article 81, subsection 1, referring to financial instruments identified in the that regulation, which authorises the depositary to subdeposit the financial instruments with a central depository must be approved in writing. In exercising such authority, depositaries shall have all the necessary powers, including that of endorsement to the central depository where the financial instruments in question are registered. Deposit may be performed directly by the issuer.

3. Financial instruments shall be consigned to the central systems as a non-fungible deposit. The central depository shall be authorised to carry out all transactions inherent to central depository activity in compliance with the regulation referred to in Article 81(2), and to take action as necessary following the destruction, loss or theft of the financial instruments.

Article 86
Transfer of rights attached to financial instruments on deposit

1. The person depositing financial instruments admitted to the system may, through the depositary and in accordance with the methods indicated in the services regulation envisaged in Article 81, subsection 2, request delivery of a corresponding quantity of financial instruments of the same type on deposit with the central depository.

2. The owner of financial instruments admitted to the system shall assume all rights and obligations deriving from the deposit should it be proved that the person depositing the instruments was not entitled to do so.

Article 87
Restrictions on centrally deposited financial instruments

1. Restrictions on financial instruments admitted to the system shall be transferred as-is to the rights of the depositing party, with endorsement to the central depository. Annotations of restrictions on the certificates shall have no effect, and this shall be stated on the instrument.

2. In the event of withdrawal of financial instruments from the system, the depositary shall annotate the restrictions on the related certificates with an indication of the date on which they were established.

3. In the event of seizure of financial instruments admitted to the system, formalities regarding co-owner obligations as envisaged in Articles 599 and 600 of the Italian Code of Civil Procedure shall be completed on behalf of the depositaries.

Article 88
Withdrawal of centrally deposited financial instruments

1. The central depositary shall make any financial instruments subject to a withdrawal request available to the depositary. Registered financial instruments shall be endorsed in the name of the depositary, who shall complete the endorsement with the name of the endorsee. Completion of the endorsement shall be validated with the stamp, date and signature of the depositary.

2. The central depository may authenticate the endorsing signature also when endorsed in its own favour. The central depository signature affixed to the instrument as endorsing party does not require authentication. The endorsement and registration in the name of the central depository of financial instruments to be admitted to the system shall specifically mention this decree.

Article 89
Updating of the shareholders’ register

1. For the purpose of updating the shareholders’ register, the central depository shall inform issuers of registered shares endorsed in its favour.

Chapter III
Central depository regulations for government securities

Article 90
Central deposit of government securities

1. The Minister of the Economy and Finance shall issue a regulation on the central deposit of government securities, indicating related operating criteria and the methods for identifying central depositories of government securities. Unless otherwise envisaged in the regulations issued pursuant to this article, Chapter I and Chapter II, Articles 83-bis to 83-decies shall apply.

PART IV
REGULATION OF ISSUERS

TITLE I
GENERAL PROVISIONS

Article 91
Consob's powers

1. Consob shall exercise the powers provided for in this Part having regard to the protection of investors and the efficiency and transparency of the market in corporate control and the capital market.

Article 91-bis
Communication of the Member State of origin

1. In the cases contemplated by Article 1, paragraph 1, letter w-quater), the issuers communicate the Member State of origin in compliance with Article 113-ter and the provisions adopted by Consob by regulation. The same disclosure is made to the competent authorities of the Member State in which the issuer has its registered office, if applicable, and to the competent authorities of the Member State of origin and of the host Member States.

2. For the issuers indicated under Article 1, paragraph 1, letter w-quater), numbers 3), 4) and 4-bis), which have not made the disclosure of the Member State of origin within three months from the date on which the securities are admitted for trading, for the first time in the European Union, solely on an Italian regulated market, the Member State of origin is Italy. For the issuers of securities admitted for trading on regulated markets of several Member States, including Italy, in the absence of the disclosure required by paragraph 1, both Italy and such other Member States are considered the Member State of origin, until the successive choice and relative disclosure487.

Article 92
Equal treatment

1. Listed issuers and listed issuers with Italy as their home Member State shall guarantee the same treatment and with identical terms and conditions to all holders of the listed financial instruments.

2. Listed issuers and listed issuers with Italy as their home Member State shall guarantee the instruments and information necessary for the exercise of rights to all holders of the listed financial instruments.

3. By regulation and in compliance with EU law, Consob shall dictate the enactment provisions pursuant to subsection 2, also envisaging the option to use electronic information transmission media488.

Article 93
Definition of control

1. In this part, in addition to the companies indicated in paragraphs 1 and 2 of the first subsection of Article 2359 of the Civil Code, the following shall also be considered subsidiaries:

a) Italian and foreign companies over which a person has the right, by virtue of a contract or a clause in the instrument of incorporation, to exercise a dominant influence, where the applicable law permits such contracts or clauses,

b) Italian and foreign companies where a shareholder controls alone, on the basis of agreements with other shareholders, enough votes to exercise a dominant influence in the ordinary shareholders' meeting.

2. For the purposes of subsection 1, rights held by subsidiaries or exercised through trustees or nominees shall be considered, those held on behalf of third parties shall not be considered.

TITLE II
SOLICITATION OF PUBLIC SAVINGS

Chapter I489
Public offerings

Article 93-bis 490
Definitions

1. In this Chapter:

a) "EU financial instruments" shall mean: securities and units of UCIs funds491

b) “equity securities” shall mean: shares and other tradable instruments equivalent to shares in companies and any other type of tradable EU financial instrument conferring the right to purchase the aforementioned instruments by conversion or the exercise of options, provided that such instruments are issued by the issuer of the underlying shares or by a member of the same group as that of the issuer;

c) “instruments other than equity securities” shall mean: all EU financial instruments that are not equity securities;

d) …omissis…492

e) “global organiser” shall mean: the person organising and establishing the placement syndicate, the placement coordinator or sole placement agent;

f) “home member state” shall mean:

1) for all EU issuers of financial instruments not mentioned under subparagraph 2) below, the EU member state of the issuer's registered office;

2) for the issue of EU financial instruments other than equity securities, the nominal unit value of which is at least 1,000 euro and for the issue of EU financial instruments other than equity securities with options to purchase tradable securities or receive a cash amount through the conversion or exercise of options conferred, provided that the issuer of EU financial instruments other than equity securities is not the issuer of the underlying EU financial instruments or a member of the issuer’s group, the EU member state of the issuer's registered office or in which the EU financial instruments have been or shall be destined for admission to trading on a regulated market or in which the EU financial instruments are offered to the public, as decided by the issuer, offeror or the person requesting the admission, as required. The same shall apply to EU financial instruments other than equity securities in a currency other than euro, provided that the minimum value of such currency shall be more or less equivalent to 1,000 euro;

3) for all issuers of EU financial instruments not mentioned under subparagraph 2) with registered office in another country, the EU member state in which the EU financial instruments are destined to be offered to the public for the first time after the entry into force of Directive 2013/50/EU or in which the first application for admission to trading on a regulated market was submitted as decided by the issuer, offeror or person requesting the admission, as required, except where issuers with registered office in another country should subsequently decide, if the home member state was not determined by their own choice in the following circumstances:

3.1 if the Member State of origin has not been determined by their choice, or

3.2 pursuant to Article 2, paragraph 1, letter i), point iii), of Directive 2004/109/EC493;

3-bis) in relation to the offer of units or shares of harmonised UCITS, the EU Member State in which the UCITS was constituted494;

g) “host member state” shall mean: the EU member state in which a public offering is implemented or where application to trading of EU financial instruments is made, if different from the home member state.

Section I
Public offering of EU financial instruments and financial products other than open-end UCITS units or shares

Article 94
Obligations of offerors

1. Persons who intend to make a public offering shall give advance notice thereof to Consob, attaching the prospectus to be published. In the case of the offer to the public of closed-ended UCI units or shares for which Italy is the Home State, the prospectus is published when the procedure contemplated by article 43 or by article 44 and the relative enactment provisions has been completed495.

2. The prospectus shall contain the information that, depending on the characteristics of the financial products and the issuer, is necessary for investors to make an informed assessment of the issuer's assets and liabilities, profits and losses, financial position and prospects and of the financial products and related rights. The prospectus also contains a securities note which briefly gives key information, in non-technical jargon, in the language in which the prospectus was originally drafted. The format and content of the securities note, together with the prospectus, give adequate information on the fundamental features of the financial products in order to aid the investors to decide whether or not to invest in such products496.

3. The prospectus for the public offering of EU financial instruments shall be drafted in compliance with models provided in EU regulations on this matter.

4. Offerors may request the issue of the authorisation referred to in subsection 3 in order to have the prospectus published in Italy recognized abroad.

5. Consob, taking account of the characteristics of individual markets, may, at the request of the stock exchange company, entrust such company with tasks concerning the examination of prospectuses for public offerings of financial instruments that are listed or the object of an application for admission to listing on a regulated market.

6. Where the offering relates to financial products other than EU financial instruments, the prospectus for which is not governed by article 95, subsection 1, paragraph b), Consob shall establish, on request from the issuer or offeror, the content of the prospectus.

7. Any new and significant fact or material error in relation to information contained in the prospectus and likely to influence the assessment of financial products, and which still exist or are discovered between the time of approval of the prospectus and the closing date of the public offering must be mentioned in a supplement to the prospectus.

8. The issuer, offeror or any guarantor, as applicable, or the persons responsible for the information contained in the prospectus, shall be liable, each in relation to the extent of their own duties, for damages caused to the investor placing reasonable faith in the truth and accuracy of information contained in the prospectus, unless it is proved that all due diligence was adopted for the purpose of guaranteeing that the information in question complied with the facts and that no information was omitted that could have altered the sense thereof.

9. The intermediary responsible for placement shall be liable for false information or omissions that could influence the reasoned decisions of an investor, unless said intermediary proves that all due diligence was adopted pursuant to the previous subsection.

10. No person may be held liable solely on the basis of the securities note, including any translation, unless the securities note proves misleading, inaccurate or inconsistent if read together with other parts of the prospectus or, when read together with the other parts of the prospectus, it does not give the key information that can aid the investor to decide whether or not to invest in the financial products offered. The securities note also contains a clear warning to this regard497.

11. Claims for compensation may be brought within five years of publication of the prospectus, unless the investor can prove having discovered the false nature of the information or omissions in the two years prior to the financial year in which such action is taken.

Article 94-bis
Approval of the prospectus

1. For approval purposes, Consob shall verify the accuracy of the prospectus, and according to the modalities and procedures including the consistency and comprehensibility of the information contained therein498..

2. Consob shall approve the prospectus according to their own terms established by regulation in compliance with EU regulations. Failure to issue decision by Consob by the established deadlines shall not constitute approval of the prospectus499.

3. Also taking account the characteristics of individual markets, Consob, through special agreements, may assign tasks relating to control of the prospectus to the stock exchange company for offerings concerning financial instruments admitted for trading or involving the application for admission to listing on a regulated market, in observance of the principles established under EU regulations. In observance of the aforementioned principles and related exceptions, delegated tasks shall terminate by 31 December 2001. Consob shall inform the European Commission and the competent authorities of other EU member states on agreements relating to such delegated tasks, specifying the terms governing said delegation500.

4. In order to ensure the efficiency of procedures for approval of a prospectus concerning banking debt securities for trading on a regulated market, Consob shall stipulate cooperation agreements with the Bank of Italy.

5. Where an offering concerns EU financial instruments, Consob may transfer approval of the prospectus to the competent authority of another EU member state, subject to acceptance by the latter. Said transfer shall be notified to the issuer and offeror within three working days of the decision taken by Consob. The approval deadlines shall commence from said date.

Article 95
Implementing provisions

1. Consob shall issue a regulation with provisions implementing this chapter, which may be differentiated according to the characteristics of the financial products, issuers and markets. The regulation shall establish in particular:

a) the content of the communication to Consob, the modalities and terms for the publication of the prospectus and the warning, as well as for the updating of the prospectus, in compliance with Community provisions501.

b) the procedures to be observed before the publication of the prospectus for disseminating new information, carrying out market research and surveying intentions to buy or subscribe;

c) the procedures for making public offerings, inter alia with a view to ensuring the equal treatment of the persons solicited.

d) the implementation methods for the offering, also to guarantee equal treatment of the addressees;

e) the language used for the prospectus;

f) the conditions for the transfer of approval of a prospectus to the competent authority of another member state.

f-bis) the internal organisational and decisional procedures for the adoption of the final deed of approval of the prospectus, even if by the assignment of responsibility to managerial personnel502.

2. Consob shall lay down in a regulation the conduct-of-business rules to be observed by the offeror, the issuer and the person placing the financial products, as well as by persons in a control relationship with or related to such persons.503

3. Consob shall publish at least a list of prospectuses approved pursuant to article 94-bis on its Internet web site.

4. Consob shall determine which financial instruments or products, admitted for trading on regulated markets or widely distributed among the public pursuant to article 116 and identified by a particular denomination or on the basis of specific qualifying criteria, must have a typical determined content.

Article 95-bis
Cancellation of a purchase or subscription

1. Where the prospectus does not indicate the conditions or criteria based on which the final offer price and quantity of products concerned in the public offering are determined or, in relation to the price, the maximum price, acceptance of the purchase or subscription of financial products may be cancelled by the deadline indicated in the prospectus and in any event in a period of not less than two working days calculated from the date of filing of the final offer price and the quantity of financial products offered to the public.

2. The investors who have already decided to buy or underwrite the financial products before the publication of a supplement have the right, to be exercised within two working days after said publication, to revoke their decision, always providing the new facts, errors or inaccuracies contemplated by article 94, subsection 7, have occurred before the final closing of the offer to the public or the delivery of the financial products. This term may be extended by the issuer or the offerer. The deadline within which the revocation right can be exercised is indicted in the supplement504.

Article 96
Issuer financial statements

1. The most recent separate or consolidated financial statements prepared by the issuer shall be accompanied by audit reports in which a statutory auditor or independent statutory auditors entered in the register held by the Ministry of the Economy and Finance expresses their opinion. Any offering of financial products other than EU financial instruments cannot be made if the statutory auditor or independent statutory auditors express an adverse opinion or disclaimer505.

Article 97
Information requirements

1. Without prejudice to Title III, Chapter I, in relation to public offerings, the related issuers, independent auditors, members of the issuer and offeror boards of directors and the intermediaries appointed as placing agents shall be subject to Articles 114(5) and 114(6) and to Article 115, from the date of the notice envisaged in Article 94, subsection 1.

2. Consob shall lay down in a regulation which of the provisions referred to in subsection 1 shall apply, for the same periods, to the other persons referred to in Article 95(2) and to persons who provide services referred to in Article 1(6)(e)506.

3. Issuers shall submit any separate or consolidated financial statements approved or prepared during the offer period for the opinion of a statutory auditor or independent statutory auditor entered in the special register507.

4. Where there are grounds for suspected violation of the provisions of this Chapter or related enactment regulations, Consob, for the purpose of obtaining details, may within one year of the purchase or subscription request information and the submission of records and documents from the buyers or subscribers of the financial products referred to under this Section, establishing related deadlines. The power to request may also be exercised with regard to persons against whom there are no grounds for suspicion that they implement, or have implemented, a public offering in contravention of the provisions of article 94508.

Article 98
Recognition of prospectuses

1. The prospectus and any supplements approved by Consob shall be valid for the purpose of the offering of EU financial instruments in other EU member states. For this purpose Consob shall issue notification in accordance with procedures in compliance with European Union provisions509.

2. If the offer of Community financial instruments is contemplated in Italy, as the Host Member State, the prospectus and any supplements approved by the authorities of the Home Member State are valid, providing the notification procedures contemplated by the EU provisions are respected. In the case of a public offer of closed-ended EU AIF units or shares, the prospectus is published on conclusion of the procedure contemplated by article 44 and the relative enactment provisions510.

3. Consob may inform the competent authority of the home member state of the need to provide new information.

Article 98-bis
Issuers from non-EU countries

1. Where the registered office of issuers is in a non-EU country, for whom Italy is the home member state, Consob may approve the prospectus drafted according to the law of the non-EU country provided the following conditions are satisfied:

a) the prospectus is drafted in compliance with international standards defined by international organisations for market supervisory commissions, including the Disclosure Standards issued by IOSCO and

b) the information requested, including information of a financial nature, is equivalent to that prescribed by EU regulations.

2. Where the offering requires that Italy acts as the host member state, article 98, subsections 2 and 3 shall apply.

Section II
Public offering of open-end UCITS units or shares

Article 98-ter 511
Document containing key information for investors and prospectus

1. The public offer of open-ended Italian UCI units or shares or EU or non-EU AIFs is preceded by communication to Consob. In the case of the offer of Italian UCITS, the communication shall be accompanied by the document containing key information for investors and the prospectus for publication. In the case of the offer of open-ended Italian, EU and non-EU AIFs, the communication shall be accompanied by the offer documentation indicated by Consob pursuant to article 98-quater, letter a-bis)512.

2. The document containing the key information for investors is prepared in compliance with EU regulations governing the matter and the related enactment provisions adopted in the EU.

3. The document containing the key information for investors and the prospectus must enable investors to reasonably understand the nature and risks of the investment proposed and, consequently, make an aware choice on the investment. The document containing the key information for investors and the prospectus are of a pre-contractual nature. The key information for investors is correct, clear, not misleading and in line with the corresponding parts of the prospectus.

4. Article 94, paragraphs 8, 9 and 11 apply. No one can be called to answer exclusively on the basis of the document containing the key information for investors, including the related translation, unless it may be misleading, imprecise or not in line with the corresponding parts of the prospectus.

5. If units or shares are offered of harmonised Community UCITS, the document containing the key information for investors and the prospectus may be published in Italy once the notification procedure established under Article 42 has been completed513.

5-bis. In the case of a public offer of open-ended Italian, EU and non-EU AIF units or shares, the offer documentation is published on conclusion of the procedure contemplated by article 43 or by article 44 and the relative enactment provisions514.

Article 98-quater 515
Enactment provisions

1. Consob prepares a regulation setting out provisions for enacting this section; these may also differ depending on the characteristics of open-ended UCITS, issuers and markets. In compliance with European Union provisions, the regulation specifically establishes:

a) the content of the communication to Consob and of the prospectus relative to the offer of Italian UCITS units or shares, and the methods and terms for the publication of the document containing the key information for investors and the prospectus, the relative delivery and updating schedule516;

a-bis) the content of the offer documentation of Italian, EU and non-EU AIF units or shares, the relative delivery and publication schedule517;

a-ter) the language regime of the document containing the key information for investors and the prospectus;

b) the methods with which to comply in disseminating news, carrying out market surveys and collecting intentions to buy or subscribe;

c) methods by which to make the offer, also with a view to ensuring equal treatment of addressees.

2. Where the characteristics of the UCITS should so require, Consob may, at the behest of the offerers, permit the inclusion of additional or equivalent information in the offer documentation to that established by the regulation pursuant to paragraph 1518.

Article 98-quinquies
Reporting obligations

1. Without prejudice to Title III, Chapter I, the following shall apply to offerors of open-end UCITS units or shares:

a) article 114, subsections 5 and 6, from the date of publication of the prospectuses until conclusion of the offering;

b) article 115, from the date of the notification pursuant to article 98-ter until one year after conclusion of the offering.

2. …omissis… 519

3. Where there are grounds for suspected violation of the provisions of this Chapter or related enactment regulations, Consob, for the purpose of obtaining details, may within one year of the purchase or subscription request information and the submission of records and documents from the buyers or subscribers of the open-end UCITS units or shares, establishing related deadlines. The power to request may also be exercised with regard to persons against whom there are grounds for suspicion that they implement public offerings in contravention of the provisions of article 98-ter.

Section III
Common provisions

Article 99
Powers of interdiction

1. Consob may:

a) suspend the public offering as a precautionary measure for a maximum of ninety days in the event of a well-founded suspicion of violation of the provisions of this chapter or the related regulations;

b) prohibit the public offering in the event of an ascertained violation of the provisions or rules referred to in paragraph a).

c) prohibit the public offering if there are grounds to suspect violation of the provisions of this Chapter or related enactment regulations;

d) prohibit the public offering if violation of the provisions or regulations referred to under paragraphs a) or b) are confirmed;

e) make public the fact that the public offering or issuer fails to meet obligations;

f) without prejudice to the powers envisaged under article 64, subsection 1-bis, paragraph c), as a preventive measure and for a period not exceeding ten consecutive working days on each occasion, request that the stock exchange company suspend trading on a regulated market in the case of grounds for suspected violation of the provisions of this Chapter and related enactment regulations;

g) without prejudice to the powers envisaged under article 64, subsection 1-bis, paragraph c), request that the stock exchange company prohibits trading on a regulated market in the case of confirmed violation of the provisions of this Chapter and related enactment regulations.

2. Where Consob, as the competent authority for the host member state, should discover irregularities committed by the issuer or authorised persons appointed to implement the public offering of EU financial instruments, Consob shall inform the competent authority of the home member state.

3. If despite measures adopted by the competent authority of the home member state, or if such measures prove inadequate, the issuer or authorised person appointed to implement the public offering continues to violate relevant legal or regulatory provisions, after informing the competent authority of the home member state, Consob shall adopt appropriate investor protection measures. Consob shall inform the European Commission as soon as possible of the adoption of such measures.

Article 100
Cases of inapplicability

1. The provisions of this chapter shall not apply to public offerings:

a) aimed exclusively at professional investors as defined pursuant to Article 30(2)520;

b) aimed at a number of persons not exceeding that established by Consob in a regulation521;

c) of a total amount not exceeding that established by Consob in a regulation522;

d) having as their object financial instruments issued or guaranteed by the Italian government or an EU member state or issued by international organisations of a public nature of which one or more EU member states are part;

e) having as their object financial instruments issued by the European Central Bank or the national central banks of the EU member states;

f) relating to instruments other than equity shares issued on an ongoing or repeated basis by banks, provided that such instruments:

i) are not subordinated, convertible or tradable;

ii) do not confer the right to subscribe to or purchase other types of financial instruments and are not linked to a derivative;

iii) give material right to the receipt of refundable deposits;

iv) are covered by a deposit guarantee system pursuant to articles 96 to 96-quarter of Legislative Decree no. 385 of 1 September 1993;

g) relate to money market instruments issued by banks with a less than 12-month maturity.

2. Consob may specify in a regulation other types of public offering to which the provisions of this chapter shall not apply in whole or in part523.

3. The issuer or offeror shall have the right to draft a prospectus pursuant to European provisions at the time of the public offering of instruments referred to under paragraphs c), d) and e) of subsection 1.

Article 100-bis 524
Circulation of financial products

1. The subsequent resale of financial products which have become the subject matter of a public offering which is exempt from the obligation to publish a prospectus forms to all effects a distinct and autonomous investment incentive in the case where there occur the conditions specified in the definition provided for in Article 1, subsection 1, paragraph t) and there are not any cases of inapplicability provided for by Article 100525.

2. An investment incentive occurs also whenever the financial products which formed the subject matter in Italy or abroad of an allocation reserved for qualified investors are, during the following twelve months, systematically resold to people who are not qualified investors and this resale does not fall within any of the cases of inapplicability provided for in Article 100526.

2-bis. The intermediary, in the successive resale of the financial products, may take avail of a prospectus already available and still valid, providing the issuer or the person responsible for drafting the prospectus have given their consent to such use by means of written agreement527

3. On the assumption as per subsection 2, whenever a prospectus has not been published, the purchaser, who acts for purposes outside entrepreneurial or professional activity, can insist on voiding the contract and the authorised persons where the resale of the financial products occurred shall be liable for damage. What withstands is the application of sanctions by Article 191 and what was established by Article 2412 subsection 2, Article 2483 subsection 2 and Article 2526 subsection 4 of the Civil Code528.

4. Subsection 2 is not applied to the resale of certificates of indebtedness issued by member States of the Organisation for Economic Co-operation and Development (OECD) with a rating investment grade assigned by at least two credit rating agencies pursuant to regulation (EC) n° 1060/2009 or whose ratings are endorsed by rating agencies registered pursuant to the aforesaid regulation, withstanding the exercise of the other civil, penal and administrative actions provided for the protection of investors529.

4-bis. Consob has the power to dictate enactment provisions with regard to this article530.

Article 100-ter 531
Offers via portals for the collection of capital

1. Public offers conducted exclusively via one or more portals dedicated to the collection of capital may have the sole purpose of the underwriting of financial instruments issued by the innovative start-ups, by the innovative SMEs, by the collective investment bodies or other companies which invest primarily in innovative start-ups and in innovative SMEs and must have a total amount lower than that determined by Consob pursuant to article 100, subsection 1, letter c)532.

2. Consob determines the discipline applicable to the offers referred to in the preceding subsection, in order to ensure that a part of the financial instruments offered are underwritten by professional investors or special categories of investors identified by Consob, when the offer is not reserved exclusively to professional customers, and to protect the investors who are not professional customers if the majority shareholders of the innovative start-up or innovative SME transfer their own equity to third parties after the offer533.

2-bis. As an alternative to the provisions under article 2470, section two of the Italian Civil Code and article 36, section 1-bis of Decree-Law no. 112 of 25 June 2008, converted with amendments by Italian Law no. 133 of 6 August 2008 and subsequent amendments, for the subscription or purchase and subsequent sale of shares representing the innovative start-up and innovative SME capital, constituted in the form of a joint stock company:

a) the subscription or purchase may be carried out through an intermediary authorised to render one or more of the investment services provided for pursuant to article 1, section 5, points a), b) and e); qualified intermediaries carry out the subscription or purchase of the shares in their own name or on behalf of the subscribers or buyers that subscribe to the bid via the portal;

b) within thirty days from the close of the bid, authorised intermediaries notify the Companies Register of their ownership of shares on behalf of third parties, incurring the relevant cost thereof; in this regard, the subscription conditions published on the portal must expressly provide that: should the subscription to the bid be successful and should the investor decide to make use of the alternative regimen referred to the section above, this shall imply the concurrent and mandatory conferral of a mandate to the appointed intermediaries so that they may:

1) register the shares in their own name or on behalf of the subscribers or buyers, providing adequate proof of the latter's identity and the shares owned;

2) issue a confirmation certificate on behalf of the subscriber or buyer, proving ownership of the shares; said confirmation certificate purely serves to legitimise the corporate rights, refers to the subscriber or buyer by name, is not transferable to third parties even on a temporary basis, for any reason, and does not constitute a valid instrument to transfer ownership of the shares;

3) allow the subscribers or buyers that make application to sell the shares pursuant to point c) of this section;

4) grant subscribers and buyers the right to apply, at any time, for the relevant shares to be registered directly in their name;

c) the subsequent sale of shares by a subscriber or buyer pursuant to point b), number 3) is carried out by simply annotating the transfer in the registers held by the intermediary; the subscription and transfer do not result in costs or fees for the buyer or seller; the subsequent certification issued by the intermediary for the purposes of exercising corporate rights replaces and covers the formalities referred to under article 2470, section two of the Italian Civil Code534.

2-ter. Specific reference in the portal must be made to the alternative regimen for transferring shares pursuant to section 2-bis, which should also provide for an appropriate box or other means for exercising the option or indicating the intention to apply the ordinary regimen pursuant to article 2470, section two of the Italian Civil Code and article 36, section 1-bis of Decree-Law no. 112 of 25 June 2008 converted with amendments by Italian Law no. 133 of 6 August 2008 and subsequent amendments535.

2-quater. Without prejudice to any other provision under Part II, Title II, Heading II, the execution of subscriptions, purchases and sales relating to financial instruments issued by innovative start-ups and innovative SMEs or shares representative of the latter's capital, carried out in accordance with the procedures set out under points b) and c) of section 2-bis of this article, do not require a written contract to be entered into in terms of article 23, section 1. Any fee, expense or charge payable by the subscriber, buyer or seller must be indicated in the bid portal, with separate and clear information on the conditions practised by each intermediary involved, and this should also appear in a specific section of each intermediary's internet site. Failing which, nothing is payable to the intermediaries536.

2-quinquies. Once two years have lapsed from the date on which the relevant company is no longer an innovative start-up due to the expiry of the time-limit referred to under article 25, sections 2, point b), and 3 of Decree-Law no. 179 of 18 October 2012, converted with amendments by Italian Law no. 221 of 17 December 2012 and subsequent amendments, intermediaries shall register the shares held on behalf of the subscribers and buyers directly in the name of the latter. The registration is carried out by notifying the Companies Register of the list of share owners, and is subject to a once-off fee payable by the intermediary. In the event of having opted for the regimen referred to under section 2-bis of this article, the subsequent registration replaces and covers the formalities referred to under article 2470, section two of the Italian Civil Code537.

Article 101
Advertisements

1. Documentation relating to any form of advertisement concerning a public offering is issued to Consob at the time of advertising.

2. Prior to the publication of the prospectus is prohibited any form of advertisement concerning public offerings of financial products other than community financial products.

3. Advertisements shall comply with the guidelines laid down by Consob in accordance with Community regulation and, any way, having regard to the accuracy of the information and its conformity with the contents of the prospectus, if already published, or with the contents of the prospectus to be published538.

4. Consob may:

a) suspend as a precautionary measure for a maximum ten working consecutive days the further spread of an advertisement relating to a public offering concerning Community financial products, in the event of a well-founded suspicion of violation of the provisions in the preceding paragraphs or of the related regulations;

b) suspend a precautionary measure, for a maximum ninety days, the further spread of an advertisement relating to a public offering of products relating different from those referred to paragraph a), in the event of an ascertained violation of the provisions or rules referred to previous paragraphs or related regulations;

c) prohibit the further spread of the advertisement of the public offering in the event of failure to comply with the measures referred to in paragraphs a) or b).

d) prohibit execution of the public offering, in the case of failure to comply with the provisions of paragraphs a), b) or c).

5. Regardless of the obligation to publish a prospectus, significant information provided by the issuer or offeror to qualified investors or special categories of investor, including information disclosed during meetings regarding the offering of financial products, must be disclosed to all qualified investors or all special categories of investor to whom the offering is exclusively addressed.

Chapter II
Public offers to buy or exchange financial instruments

Section I
General provisions

Article 101-bis 539
Definitions and application environment

1. For the purposes of this chapter, “Italian listed companies” shall mean companies with registered office in Italy and with securities admitted to trading on an EU regulated market.

2. For the purposes of this chapter and article 123-bis, “securities” shall mean financial instruments carrying voting rights, also limited to specific topics, at ordinary or extraordinary shareholders' meetings.

3. Article 102 subsections 2 and 5, article 103 subsection 3-bis, all other provisions of this decree imposing specific reporting obligations upon the offeror or issuer with respect to employers or their representatives, together with articles 104, 104-bis and 104-ter, shall not apply to:

a) takeover bids or exchange tender offerings involving financial products other than securities;

b) takeover bids or exchange tender offerings not involving securities that carry voting rights on the topics indicated in article 105 subsections 2 and 3;

c) takeover bids or exchange tender offerings launched by parties who, directly or indirectly, hold the majority of voting rights exercisable at ordinary shareholders' meetings of the company540;

d) takeover bids involving own shares.

3-bis. Without prejudice to the provisions of subsection 3, by regulation Consob may identify takeover bids and exchange tender offerings, involving financial products other than securities, for which the provisions of this Section wholly or in part shall not apply, where there is no conflict with the aims of article 91541.

4. “Persons acting in concert” shall mean persons cooperating together on the basis of a specific or tacit agreement, verbal or in writing, albeit invalid or without effect, for the purpose of acquiring, maintaining or strengthening control over the issuer or to counteract achievement of the aims of a takeover bid or exchange tender offering542.

4-bis. In any event, persons considered to be acting in concert are:

a) parties to an agreement, even if void, envisaged in article 122, subsection 1 and subsection 5 paragraphs a), b), c) and d);

b) an entity, its parent company and its subsidiaries;

c) companies subject to joint control;

d) a company and its directors, members of the management board, or supervisory board or general managers 543.

4-ter. Without prejudice to subsection 4-bis, by regulation Consob shall identify:

a) cases in which it is presumed that the parties involved are persons acting in concert pursuant to subsection 4, unless they can prove that the conditions of said subsection do not apply;

b) cases in which the cooperation between several persons does not qualify as acting in concert pursuant to subsection 4544.

Article 101-ter
Supervisory authority and applicable law

1. Consob shall supervise takeover bids or exchange tender offerings in compliance with the provisions of this chapter.

2. For the purposes of allocation of responsibilities between Consob and other EU Member State authorities with regard to takeover bids or exchange tender offerings involving securities of companies subject to the law of an EU Member State, and instrumental or subsequent to the acquisition of control under the national law of the issuer, the following provisions shall be observed.

3. Consob shall supervise the implementation of public offerings:

a) involving securities issued by a company with registered office in Italy and admitted to trading on one or more Italian regulation markets;

b) involving securities issued by a company with registered office in an EU Member State other than Italy and admitted to trading solely on Italian regulation markets;

c) involving securities issued by a company with registered office in an EU Member State other than Italy and admitted to trading on regulated markets in Italy and in EU Member States other than that in which the company is registered, if said securities were first admitted to trading on an Italian regulated market or, if the securities were simultaneously first admitted to trading on regulated markets in Italy and in other EU Member States, where the issuer adopts Consob as the competent supervisory authority, informing the aforementioned markets and their supervisory authorities on the first day of trading. By regulation, Consob shall establish the terms and conditions for the public disclosure of the issuer’s decision regarding adoption of the authority responsible for supervision of the offering.

4. Where Consob is the competent supervisory authority pursuant to subsection 3, paragraphs b) and c), matters concerning the price, procedure, with particular reference to reporting obligations on the decision of the bidder to proceed with the bid, content of the takeover bid document and disclosure of the bid shall be governed by Italian law. In matters relating to the information to be provided to employees of the issuer, matters relating to company law, in particular with regard to the threshold exceeded which a takeover bid becomes mandatory, to any derogation from such an obligation and the conditions under which the board of the issuer may undertake any action which might result in the frustration of the bid, the applicable rules and the competent authority shall be those of the Member State in which the issuer has its registered office.

5. Where the takeover bid involves securities issued by companies with registered office in Italy and admitted to trading solely on one or more regulated markets of other EU Member States, the matters indicated under subsection 4, second paragraph, shall be governed under Italian law and the relevant supervisory authority shall be Consob545.

Article 102
Bidder obligations and prohibitive powers

1. The decision or occasion giving rise to the mandatorily promote a takeover bid or exchange tender offering shall be notified to Consob without delay and at the same time disclosed to the public. By regulation, Consob shall establish the content and publication terms of the notice.

2. As soon as the bid has been made public, the boards or control bodies of the issuer and of the bidder shall inform the representatives of their respective employees or, where there are no such representatives, the employees themselves.

3. Unless otherwise dictated by article 106, subsection 2, the bidder shall take immediate action to make the bid, and in any event no later than twenty days from the notice pursuant to subsection 1, and submit the takeover bid document for publication to Consob. Should said deadline not be met, the takeover bid document shall be declared inadmissible and the bidder may not make a further bid on the same financial products of the issuer in the twelve months thereafter.

4. Within fifteen days of submission of the takeover bid document, Consob shall issue its approval if the document allows receiving parties to form a reasoned opinion on the bid. On issue of approval, Consob may indicate to the bidder additional information to be included, specific means of publication of the takeover bid document and any special guarantees to be provided. The time limit for takeover bids involving unlisted financial products, or products widely distributed among the public pursuant to article 116, shall be thirty days. Should it prove necessary to request additional information from the bidder, said time limits shall be suspended, once only, until such information is received. Such information shall be provided within the time limit established by Consob, in any event not exceeding fifteen days. If for takeover bid implementation purposes, sector regulations require authorisation from other authorities, Consob shall approve the takeover bid document within five days of notification by said authorities. On expiry of the time limits indicated in this subsection, the takeover bid document shall be deemed approved.

4-bis. Limited to exchange tender offerings involving bonds and other debt securities, the bidder, also as an exception to the provisions of this chapter, may apply to Consob requesting that the offering be made subject to the provisions for public offerings for sale and subscription pursuant to Chapter I in this Title. Within fifteen days of receipt of such an application, Consob shall accept the request provided it does not conflict with the aims of article 91546.

5. When the document is made public, the boards or controlling bodies of the issuer and of the bidder shall circulate the document to the representatives of their respective employees or, where there are no such representatives, to the employees themselves.

6. Pending the takeover bid, Consob may:

a) suspend the bid as a precautionary measure if there are grounds to suspect violation of the provisions of this chapter or of regulatory provisions;

b) suspend the takeover bid for a period not exceeding thirty days if new facts, or facts not previously known, come to light that would not allow receiving parties to form a reasoned opinion on the bid;

c) declare the takeover bid lapsed if violation of the provisions or regulations referred to under paragraph a) is confirmed;

7. For the purposes of its supervision of the observance of provisions referred to in this chapter, Consob shall exercise the powers envisaged by article 115, subsection 1, paragraphs a) and b) against any party appearing to be aware of the facts. Where there are grounds to suspect violation of the provisions of this chapter or of regulatory provisions, article 187-octies shall apply.

8. Where indiscretions in any event spread to the public with regard to a possible takeover bid or exchange tender offering and there are irregularities in the market performance of the securities concerned, article 114, subsections 5 and 6 shall apply to the potential bidders547.

Article 103
Implementation of offers

1. Offers shall be irrevocable. Any clause stating the contrary shall be null and void. The offer shall be made at the same conditions to all the holders of the financial products that are the object thereof.

2. Without prejudice to Title III Chapter I, article 114, subsections 5 and 6, and article 115 shall apply to the issuers, bidders, persons acting in concert and the intermediaries appointed to collect bids from the date of notification indicated in article 102, subsection 1 and until one year from closure of the takeover bid548.

3. The board of directors of the issuer shall issue a notice containing all information useful to evaluating the bid and its own evaluation of the bid. For companies with a two-tier structure, the notice shall be approved, jointly if necessary, by the control body and supervisory council 549.

3-bis. The notice shall also contain an evaluation of the effects of eventual success of the takeover bid on the interests of the company, and on the employment conditions and location of business premises. At the same time as its disclosure, the notice shall be issued to representatives of the company’s employees or, where there are no such representatives, directly to the employees. If received in time, the opinion of employee representatives regarding repercussions on employment conditions, shall be attached to the notice550.

4. By regulation, Consob shall dictate the enactment provisions of this section, in particular governing:

a) content of the takeover bid document, its publication terms and terms of implementation of the takeover bid;

b) correctness and transparency of transactions on the financial products concerned;

c) the effects on the takeover bid price of purchase of the financial products concerned, by the bidders or persons acting in concert with the bidders after issue of the notice pursuant to article 102, subsection 1, pending the bid or in the six months following its closure;

d) amendments to the bid, increased and rival bids, without limiting the number of increased offers, that may be made prior to expiry of a maximum deadline;

e) acknowledgment of takeover bid documents approved by the supervisory authorities of other EU Member States or of non-EU countries with which cooperation agreements exist;

f) the publication terms of measures adopted by Consob pursuant to this section551.

5. …omissis…552

Article 104 553
Defensive measures

1. Unless approved by the ordinary or extraordinary shareholders’ meeting, depending on the attributed level of decision-making powers, Italian listed companies whose securities are involved in the offering shall abstain from action or transactions that could counteract achievement of the aims of the offering. This abstention obligation shall apply from the date of notice pursuant to article 102, subsection 1, until closure of the offering or until the offering expires. Mere research into other offerings shall not constitute an act or transaction in conflict with the aims of the offering. The liability of directors, members of the management board, supervisory board and general managers for action taken or transactions executed shall remain unchanged554.

1-bis. The shareholders’ meeting approval envisaged in subsection 1 shall also be required for the implementation of any decision taken before the start of the period indicated in subsection 1, not yet implemented wholly or in part, that does not fall within the normal business practices of the company and the implementation of which could counteract achievement of the aims of the offering555.

1-ter. The articles of association may differ, wholly or in part, from the provisions of subsections 1 and 1-bis. The company shall notify any difference approved pursuant to this subsection to Consob and to supervisory authorities for takeover bids in member countries in which their securities are admitted to listing on a regulated market or in which admission to listing has been requested. Without prejudice to the provisions of article 114, such differences shall also be promptly disclosed to the public in accordance with said provisions556.

2. The notice of call to shareholders’ meetings referred to under this article shall be published by the means indicated in Article 125-bis at least fifteen days prior to the date of the shareholders’ meeting557.

Article 104-bis 558
Breakthrough

1. Without prejudice to the provisions of article 23, subsection 3, the articles of association of an Italian listed company, other than a cooperative, may provide that, where a takeover bid or exchange tender offering is launched involving securities issued by that company, the regulations pursuant to subsections 2 and 3 shall apply559.

2. In the takeover bid period, limitations on the transfer of securities as envisaged in the articles of association shall have no effect on the bidder. Likewise, limitations on voting rights envisaged in the articles of association or shareholders’ agreement in cases where a shareholders' meeting is called to resolve upon the actions and transactions pursuant to article 104, shall have no effect on the bidder. At the same Shareholders' Meetings, the multiple-voting shares confer only one vote and the voting rights assigned pursuant to Article 127-quinquies560 are not counted.

3. If as a result of a takeover bid pursuant to subsection 1 the bidder comes into possession of at least seventy-five per cent of the share capital with voting rights in relation to resolutions on the appointment or removal of directors or members of the controlling body or supervisory council, at the first shareholders’ meeting following close of the bid, called to amend the articles of association or to remove or appoint directors or members of the controlling body or supervisory council, the multiple-voting shares confer only one vote and the following have no effect561:

a) limitations on voting rights as envisaged in the articles of association or shareholders’ agreements;

b) any special right in relation to the appointment or removal of directors or members of the control body or supervisory council as envisaged in the articles of association.

b-bis) the additional votes due pursuant to article 127-quinquies562.

4. The provisions of subsections 2 and 3 shall not apply to articles of association limitations on voting rights attributed to securities with capital privileges.

5. If the result of the bid pursuant to subsection 1 proves positive, the bidder shall be obliged to pay a fair indemnity for any prejudice to share capital suffered by holders of rights the exercise of which is rendered null by application of the provisions of subsections 2 and 3, provided that provisions of the articles of association or contractual provisions constituting such rights were in force prior to issue of the notice pursuant to article 102, subsection 1. The claim for indemnity must be submitted to the bidder, on penalty of lapse, within ninety days of the close of the bid or, where subsection 3 applies, within ninety days of the date of the shareholders' meeting. Should no agreement be reached, the amount of the indemnity shall be decided by the court as a discretionary assessment with regard, inter alia, to a comparison between the average market price of the security in the twelve months prior to issue of the first notice concerning the bid and the price performance following the positive conclusion of the bid.

6. The indemnity referred to under subsection 5 shall not be payable due to prejudice to share capital derives from the exercise of voting rights in conflict with a shareholders’ agreement if, at the time of exercise of the voting right, the declaration of withdrawal pursuant to article 123 subsection 3 had already been submitted.

7. The provisions regarding special powers pursuant to article 2 of Italian Decree Law no. 332 of 31 May 1994, converted with amendments to Law no. 474 of 30 July 1994 as amended, and on shareholding limitations and on voting rights pursuant to article 3 of said Decree Law, shall remain valid563.

Article 104-ter 564
Reciprocity clause

1. The provisions of article 104, subsections 1 and 1-bis and, if envisaged in the articles of association, the provisions of article 104-bis, subsections 2 and 3, shall not apply to takeover bids or exchange tender offerings by entities not subject to such provisions or equivalent provisions, or by a company or entity controlled by such entities. Where launched by persons acting in concert, it is sufficient that such provisions do not apply to just one of the bidders involved565.

2. …omissis…566

3. At the request of the bidder or issuer and within twenty days of submission of the request, Consob shall decide whether the provisions applicable to the parties indicated under subsection 1 are equivalent to provisions to which the issuer is subject. By regulation, Consob shall establish the content and submission terms of such a request.

4. Any measure adopted by the issuer that could frustrate the bid under the terms of subsection 1 must be expressly authorised by the shareholders’ meeting, with regard to a possible takeover bid, in the eighteen months prior to disclosure of the decision to implement a takeover bid pursuant to article 102 subsection 1. Without prejudice to article 114, said authorisation shall be disclosed to the market without delay in accordance with the terms pursuant to said article567.

Section II
Mandatory public offers to buy

Article 105 568
General provisions

1. Except for the provisions of article 101-ter, subsections 4 and 5, and the provisions of this section shall apply to Italian companies with securities admitted to trading on Italian regulated markets569.

2. For the purposes of this section, shareholding shall mean a portion, held directly or indirectly through trust companies or nominees, of the securities issued by a company pursuant to subsection 1 that give the right to vote in shareholders' meetings on resolutions concerning the appointment, removal or liability of directors or members of the supervisory board570.

3. Consob may issue a regulation whereby the relevant capital shall include security categories in the equity investment that give the right to vote on one or more different matters taking into account the nature of the influence their exercise, jointly or severally, may have on the management of the company. By regulation, Consob shall also decide upon the investment calculation criteria pursuant to subsection 2 if the securities referred to therein are, as a result of legal or regulatory provisions, without voting rights or if the articles of association contemplate increased voting rights571.

3-bis. By regulation Consob shall establish the cases and methods by which derivates held are counted in the investment pursuant to subsection 2572.

Article 106 573
Global takeover bid

1. Anyone who, following acquisitions or increased voting rights, holds a stake greater than the thirty percent threshold or holds more than thirty percent of the voting rights of the same, promotes a takeover bid addressed to all security holders for the totality of the securities admitted for trading on a regulated market in their possession574.

1-bis. In companies other than SMEs, the offer referred to in section 1 can be promoted also by anyone who, subsequent to acquisitions, comes to hold a stake greater than the threshold of twenty-five per cent, where there is no other shareholder with a higher stake575.

1-ter. The articles of association of SMEs may contemplate a threshold different from that indicated in section 1, however not less than twenty-five percent nor greater than forty percent. If the articles of association are emended after the start of trading of the securities on a regulated market, the shareholders who have not participated in the relative resolution have the right to withdraw for all or part of their securities; articles 2437-bis, 2437-ter and 2437-quater of the Italian Civil Code shall be applied576.

2. For each class of securities, the takeover bid shall be made within twenty days at a price no less than the highest price paid by the bidder, and by persons acting in concert with the bidder, in the twelve months prior to issue of the notice pursuant to article 102 subsection 1, to acquire securities of the same class. If no purchase against payment of securities of the same class was made in the period indicated, the takeover bid is implemented for that class of securities at a price no less than the weighted market average over the previous twelve months or shorter available period. The same price applies, in the absence of purchases at a higher price, if the threshold relative to voting rights is exceeded by effect of the additional voting rights pursuant to article 127-quinquies577.

2-bis. The bid price may be constituted, wholly or in part, by securities. If the securities offered in payment of the bid price are not admitted to trading on a regulated market in an EU Member State or if, in the period indicated in subsection 2 and until the close of the bid, the bidder or persons acting in concert with the bidder made a cash purchase of securities that confer at least five per cent of voting rights at the shareholders’ meeting of the issuer of the securities involved in the takeover bid, the bidder must at least offer a cash payment to related investors as an alternative to payment in securities.

3. By regulation, Consob shall regulate situations in which:

a) the equity investment indicated in sections 1, 1-bis and 1-ter is acquired by the purchase of shareholdings or by increased voting rights, in companies in which the capital is mainly constituted by shares issued by other companies pursuant to article 105, subsection 1578;

b) the offer obligation follows acquisitions higher than 5% or the increase in voting rights of more than five percent of the same, on the part of those who already hold the stake indicated in sections 1 and 1-ter without holding the majority of voting rights in the ordinary shareholders’ meeting579;

c) subject to provision with just cause by Consob, the takeover bid is promoted at a price lower than the highest price paid, establishing criteria to determine said price and provided one of the following circumstances subsists:

1) the market prices were influenced by exceptional events or there are grounds to suspect they were subjected to manipulation;

2) the highest price paid by the bidder, or persons acting in concert with the bidder, in the period indicated under subsection 2 is either the buy-sell price for the securities involved in the takeover bid applied under market conditions and as part of the normal business practices or is the price of buy-sell transactions that would have benefited from one of the exemptions pursuant to subsection 5580;

d) subject to provision with just cause by Consob, the takeover bid is promoted at a price higher than the highest price paid, provided such a measure is necessary for investor protection purposes and at least one of the following circumstances subsists:

1) the bidder or persons acting in concert with the bidder have agreed to purchase securities at a price higher than that paid for the purchase of securities of the same category;

2) there is evidence of collusion between the bidder, or persons acting in concert with the bidder, and one or more of the sellers;

3) …omissis…581;

4) there are grounds to suspect that the market prices were subjected to manipulation.

3-bis. By regulation and taking into account the characteristics of the financial instruments issued, Consob may establish situations in which a takeover bid becomes mandatory following purchases that result in a cumulative holding of securities and other financial instruments, with voting rights on matters indicated under article 105, to an extent that overall voting powers are equivalent to those of a party in possession of a holding indicated under in sections 1, 1-bis and 1-ter582.

3-ter. The provisions of paragraphs c) and d) of subsection 3 shall be disclosed to the public in accordance with the terms indicated in the regulation pursuant to article 103, subsection 4, paragraph f).

3-quater. The offer obligation contemplated by subsection 3, letter b), is not applicable to SMEs, providing that this is contemplated by the articles of association, until the date of the shareholders' meeting called for the approval of the financial statement for the fifth financial period after the listing583.

4. A takeover bid shall not be considered mandatory where the shareholding indicated under in sections 1, 1-bis and 1-ter is held as a result of a takeover bid or exchange tender offering involving all the holders of securities and for the total quantity of securities in their possession, provided that, in the case of an exchange tender offering, the securities offered in exchange are listed on a regulated market in an EU Member State or a cash payment is offered as an alternative 584.

5. By regulation, Consob shall establish cases whereby exceeding the shareholding indicated in sections 1, 1-bis and 1-ter or 3 paragraph b) a takeover bid will not be considered mandatory if implemented in the presence of one or more majority shareholders or results from:

a) transactions to bail out a company in crisis;

b) transfer of the securities indicated under article 105 among parties linked by significant investment relationships;

c) causes not dependent upon the wishes of the buyer;

d) transactions, or rather, where the temporary threshold is exceeded585;

e) mergers or spin-offs;

f) purchases free of charge586.

6. By provision with just cause, Consob may establish that a takeover bid shall not be considered mandatory on exceeding the holding indicated under in sections 1, 1-bis and 1-ter or subsection 3 paragraph b) in cases attributable to the situations referred to under subsection 5, but which are not expressly indicated in the regulation approved pursuant to said subsection 587.

Article 107
Prior partial bids

1. In addition to the cases referred to in Articles 106(4) and 106(5), the provisions regarding mandatory takeover bids provided for in Articles 106(1) and 106(3) shall not apply where the shareholding is owned as a result of a takeover bid or exchange tender offering on at least sixty per cent of the securities in each category and all the following conditions are satisfied:

a) the bidder and persons acting in concert with the bidder, have not acquired shareholdings exceeding one per cent, including shares acquired under forward contracts maturing at a later date, in the twelve months preceding the notice to Consob referred to in Article 102(1) nor during the bid period;

b) the validity of the bid is subject to approval of a number of shareholders which together possess the majority of the securities concerned, pursuant to article 120, subsection 4, paragraph b) excluding securities held by the bidder, the major shareholder, also in relative terms, if that shareholding exceeds ten per cent, and by persons acting in concert with the bidder;

c) Consob shall grant the exemption after verifying satisfaction of the conditions specified in paragraphs a) and b) 588.

2. The approval procedures shall be laid down by Consob in the form of a regulation. Shareholders not subscribing to the bid may also express their opinion thereon in accordance with subsection 1, paragraph b)589.

3. The bidder is required to launch a takeover bid referred to in Article 106 where, in the twelve months subsequent to the close of the unsolicited bid:

a) the bidder, or persons acting in concert with the bidder, have acquired shareholdings exceeding one per cent, also by means of forward contracts maturing at a later date590;

b) the issuing company has approved a merger or a spin-off591.

Article 108 592
Commitment to squeeze-out

1. If as a result of a global takeover bid, the bidder becomes holder of at least ninety-five per cent of the capital represented by securities in an Italian listed company, the bidder shall be committed to squeeze-out of the remaining securities should any other party so request. Where more than one class of securities is issued, the commitment to squeeze-out shall subsist only for classes of securities for which the ninety-five per cent threshold is reached593.

2. With prejudice to the provisions of subsection 1, any party becoming holder of a quota exceeding ninety per cent of capital represented by securities admitted to trading on a regulated market shall be committed to squeeze-out the remaining securities admitted to trading on a regulated market by any holder thereof unless a float sufficient to ensure regular trading performance is not restored within ninety days. Where more than one class of security is issued, the commitment to squeeze-out shall subsist only for classes of securities for which said ninety per cent threshold is reached.

3. Where the situation indicated under subsection 1 applies, and in cases referred to under subsection 2 in which the holding indicated is reached solely as a result of a global takeover bid, the price is equal to that of the previous global takeover bid provided that, in the case of a voluntary takeover bid, as a result of said bid the bidder has acquired securities that represent not less than ninety per cent of the share capital with voting rights included in the bid.

4. Over and beyond the cases indicated in subsection 3, the price shall be established by Consob, also taking into account any previous price bid or the market price in the half-year prior to announcement of the bid pursuant to article 102, subsection 1, or article 114, or prior to the acquisition giving rise to the commitment594.

5. Where the situation indicated in subsection 1 applies, and in cases referred to under subsection 2 in which the holding indicated is reached solely as a result of a global takeover bid, the price takes the same format as that of the takeover bid, but the holder of the securities may still demand full payment in cash, to the extent established by Consob, based on general criteria defined in this regulation595.

6. If the takeover bid price is equal to that of the previous takeover bid, the commitment to squeeze-out may be effected by means of a reopening of the same terms.

7. By regulation, Consob shall dictate the enactment provisions of this section, in particular:

a) reporting obligations relating to the enactment of this article;

b) the time limits within which holders of securities may demand sale of the aforementioned securities;

c) the procedure to be followed in order to establish the price.

Article 109 596
Squeeze-out in concert

1. Parties acting in concert shall be jointly obliged under the terms of articles 106 and 108 when, as a result of purchases made even by one only of the parties, they come into possession of a total holding exceeding the percentages indicated under the above articles. The same obligations exist for those who act in concert, subsequent to an increase in voting rights, also in favour of only one of the same, if they then hold voting rights greater than the percentage indicated in article 106597.

2. Subsection 1, first sentence, shall not apply when a holding exceeding the percentages indicated in articles 106 and 108 constitutes the effect of the stipulation of an agreement, including a null agreement, pursuant to article 122, unless parties to said agreement came into possession of a total holding exceeding the aforementioned percentages in the twelve months prior to stipulation of the agreement598.

3. For the purposes of application of subsection 1, the instances indicated in article 101-bis, subsection 4-bis, become significant, including jointly, only to parties in possession of the holdings599.

Article 110
Failure to comply with obligations 600

1. In the event of violation of the obligations laid down in this section, the voting rights attached to the whole shareholding owned shall not be exercisable and the securities exceeding the percentages specified in Articles 106 and 108 must be disposed of within twelve months. Where the voting rights are exercised, Article 14(5) shall apply. The challenge may also be initiated by Consob within the time limit specified in Article 14(6)601.

1-bis. Without prejudice to the provisions of article 192, subsection 1, as an alternative to the sale referred to under subsection 1, Consob may, by provision with just cause and considering, inter alia, the reasons for failure to comply with obligations, the probable effects of the sale and any changes in the ownership structure, impose implementation of the global takeover bid at the price established by Consob, also taking into account the market price of the securities602.

1-ter. The sale envisaged under subsection 1 or takeover bid envisaged under subsection 1-bis shall cancel the suspension of voting rights pursuant to subsection 1603.

Article 111
Right to squeeze-out

1. A bidder coming into possession following a global takeover bid of a holding of at least ninety-five per cent of the capital represented by securities in an Italian listed company shall have the right to squeeze-out on remaining securities within three months of expiry of the time limit for bid acceptance, if the intention to exercise said right was declared in the takeover bid document. Where more than one class of securities is issued, the right to squeeze-out shall subsist only for classes of securities for which the ninety-five per cent threshold is reached604.

2. The amount and form of payment to be assumed shall be established pursuant to article 108, subsections 3, 4 and 5605.

3. The transfer shall be effective from the moment notice of the deposit of the consideration with a bank is given to the issuing company, which shall make the consequent entries in the shareholders' register.

Article 112
Implementing provisions

1. Consob shall issue a regulation with provisions implementing this section; in a measure to be published in the Italian Official Gazette it may, after consulting the stock exchange company, increase the percentage provided for in Article 108 for individual companies606.

TITLE III
ISSUERS

Chapter I
Company information

Article 113
Listing particulars

1. Before the date set for the start of trading in the financial instruments on a regulated market, issuers shall publish listing particulars containing the information specified in Article 94 subsections 1, 2, 3, 4, 5, 8, 10 and 11 and 94-bis, subsections 1, 2, 3 and 5 also for a person requesting admission to trading.

2. Any new and significant fact or material error in relation to information contained in the prospectus and likely to influence the assessment of financial instruments, and which still exist or are discovered between the time of approval of the prospectus and the start of trading on a regulated market must be mentioned in a supplement to the prospectus.

3. Consob:

a) shall lay down in a regulation the contents of listing particulars and the manner of their publication, with specific provisions for cases in which admission to listing on a regulated market is preceded by a public offering;

b) may require issuers to include supplementary information in the listing particulars and lay down specific procedures for their publication;

c) shall issue a regulation to coordinate the functions of the stock exchange company with its own and, taking account of the characteristics of the individual markets, at the request of such company, may entrust it with tasks concerning the examination of listing particulars.

d) shall govern the obligation to file a document with Consob concerning the information published or made available to the public by issuers during the year;

e) shall establish the conditions for the transfer of approval of a prospectus to the competent authority of another member state;

f) shall exercise powers pursuant to article 114, subsections 5 and 6 and article 115 in relation to the issuer, person requesting admission to trading and other persons indicated in said provisions.

g) may suspend the admission to trading on a regulated market for a maximum of ten consecutive working days each time there is reason to suspect that the provisions of this article and related enactment regulations have been violated;

h) without prejudice to the powers envisaged under article 64, subsection 1-bis, paragraph c), may as a preventive measure and for a period not exceeding ten consecutive working days on each occasion, request that the stock exchange company suspend trading on a regulated market in the case of grounds for suspected violation of the provisions of this article and related enactment regulations;

i) without prejudice to the powers envisaged under article 64, subsection 1-bis, paragraph c), may request that the stock exchange company prohibits trading on a regulated market in the case of confirmed violation of the provisions of this article and related enactment regulations.

l) shall inform the competent authority of the home member state if, as competent authority for the host member state, it should discover that violations of issuer obligations have been committed in relation to the admission of financial instruments for trading on a regulated market;

m) after informing the competent authority of the home member state, shall adopt appropriate investor protection measures if, despite measures adopted by the competent authority of the home member state, or if such measures prove inadequate, the issuer continues to violate relevant legal or regulatory provisions . The European Commission shall be informed as soon as possible of the adoption of such measures;

n) shall make public the fact that the issuer or person requesting admission to trading has failed to meet obligations.

4. For the advertising of an admission to listing of financial instruments on a regulated market, article 10 shall apply.

5. For the prospectus concerning admission to trading on a regulated market, articles 98 and 98-bis shall apply607.

Article 113-bis 608
Admission to trading of open-end UCITS units or shares

1. Prior to the established date for the start of trading of open-end UCITS units or shares on a regulated market, the issuer shall publish a prospectus containing the information pursuant to article 98-ter, subsection 2.

2. Consob:

a) shall by regulation determine the content of the prospectus, related publication methods, without prejudice to the need to arrange media publication through national daily newspapers, and updating of the prospectus, dictating specific measures in cases in which admission to listing on a regulated market coincides with the timing of the public offering609;

b) may indicate information to be inserted by the issuer as integrations to the prospectus and specific advertising methods;

c) shall dictate provisions to coordinate stock exchange company functions with its own and, on request from said company, may assign tasks relating to control of the prospectus, also taking into account the characteristics of the individual markets.

3. The prospectus approved by the competent authority of another EU member state shall be recognised by Consob, under the terms and conditions established in subsection 2 of the regulation, as a prospectus for admission to trading on a regulated market. Under subsection 2 of the regulation, Consob may request the publication of a document for the listing.

4. For the advertising of an admission to listing of open-end UCITS units or shares on a regulated market, article 101 shall apply.

Article 113-ter 610
General provisions on regulated disclosures

1. Regulated disclosures shall mean disclosures published by listed issuers, listed issuers for which Italy is the home member state or their controlling bodies, pursuant to the provisions of this Title, Chapters I and II, Sections 1, I-bis, and V-bis, and to related enactment regulations or provisions established by non-EU country authorities considered the equivalent of Consob611.

2. Regulated disclosures shall be filed with Consob and the stock exchange company for which the issuer has requested or received approval for admission to trading of its securities or closed-end funds, in order to guarantee that said company may exercise its duties pursuant to article 64, subsection 1.

3. Consob, in exercising the powers attributed to the same by this Title, establishes the methods and terms for disclosure to the public of the regulated information, without prejudice to the required publication in national daily newspapers, taking into account the nature of said information, in order to ensure rapid, non-discriminatory access which can, with reasonable certainty, guarantee the effective disclosure throughout the European Community612.

4. Consob shall:

a) authorise third parties to the issuer to provide disclosure services for regulatory information;

b) authorise centralised archive services for regulatory information;

c) organise and manage centralised information archive services in the absence of authorised persons pursuant to paragraph b).

5. By regulation and in relation to regulatory information, Consob shall establish:

a) filing terms and methods pursuant to subsection 2;

b) requirements and conditions for the release of authorisation to exercise disclosure services, and measures for the provision of such services given the objectives of subsection 3;

c) requirements and conditions for the release of authorisation to exercise archive services, and measures for the provision of such services to guarantee security, data source certainty, time and date stamps of the receipt of regulatory information, easy access for end users and filing procedures aligned with those of Consob;

d) the language to be used in the notices;

e) any exemptions from filing, disclosure and archiving obligations in compliance with EU law.

6. If a party has requested admission to trading of securities or closed-end funds on a regulated market, without permission from the issuer, disclosure obligations for regulatory information are observed by that party, except where the issuer, in accordance with provisions established in its home member state, discloses regulatory information to the public as required under EU law.

7. Parties obliged to disclose regulatory information to the public may not claim payment for such disclosure.

8. Consob may make public the fact that parties obliged to disclose regulatory information do not comply with such obligations.

9. Without prejudice to the provisions of article 64, subsection 1-bis, Consob may:

a) suspend or demand that the regulated market concerned suspends the trading of securities or closed-end funds for a maximum ten days on each occasion, if there are grounds to suspect that disclosures regarding regulatory information have been violated by the party under obligation, pursuant to this article, to disclose such regulatory information;

b) prohibit trading on a regulated market if it is confirmed that the provisions of paragraph a) have been violated.

Article 114 613
Information to be provided to the public

1. Without prejudice to the information requirements established by specific provisions of law, listed issuers shall make available to the public, without delay, the inside information referred to in Article 181 that directly concerns such issuers and their subsidiaries. By regulation, Consob shall establish the terms and conditions for the disclosure of information, without prejudice to the required publication in national daily newspapers, dictate measures to coordinate duties attributed to stock exchange companies with its own, and may identify duties to be delegated for the correct performance of duties envisaged in article 64, subsection 1, paragraph b)614.

2. Listed issuers shall issue appropriate instructions for subsidiaries to provide all the information necessary to comply with the information requirements established by law. Subsidiaries shall transmit the information required in a timely manner.

3. Listed issuers may, under their own responsibility, delay the communication of privileged information to the public, in order to avoid prejudice to their legitimate interests, in the cases and under the conditions established by Consob with regulation, always providing this cannot mislead the public relative to essential facts and circumstances and providing the said subjects are able to guarantee confidentiality. Consob may issue a regulation establishing that an issuer shall without delay inform it of the decision to delay the public disclosure of inside information and may identify the measures necessary to ensure the public is correctly informed.615

4. Where persons referred to in subsection 1, or persons acting on their behalf or for their account, disclose information referred to in subsection 1 in the normal exercise of their employment, profession or duties to a third party who is not subject to a confidentiality requirement based on a law, regulations, Articles of Association or a contract, they shall make complete public disclosure thereof, simultaneously in the case of an intentional disclosure and promptly in the case of a non-intentional disclosure.

5. Consob, on a general basis or otherwise, may require to the issuers, to the subjects which control them , listed issuers for which Italy is the home Member State, the members of the board of directors, the members of the internal control body, managers and persons who hold a major holding pursuant to Article 120 or who are parties to a shareholders’ agreement pursuant to Article 122 to publish, in the manner it shall establish, the information and documents needed to inform the public. Where such persons fail to comply, Consob shall publish the material at their expense.616

6. Where the issuers, the subjects which control them and listed issuers with Italy as their home member country submit justified claim to the effect that public disclosure of information pursuant to subsection 5 could seriously damage the issuer, the disclosure obligations shall be suspended. Within seven days Consob may waive the requirement to disclose all or part of the information permanently or temporarily, provided this is not likely to mislead the public with regard to essential facts and circumstances. On expiry of said deadline, the claim shall be deemed accepted617..

7. Persons performing administrative, supervisory and management functions in a listed issuer and managers who have regular access to inside information referred to in subsection 1 and the power to make managerial decisions affecting the future development and prospects of the issuer, persons who hold shares amounting to at least 10 per cent of the share capital, and any other persons who control the issuer must inform Consob and the public of transactions involving the issuer’s shares or other financial instruments linked to them that they have carried out directly or through nominees. Such disclosures must also be made by the spouse, unless legally separated, dependent children, including those of the spouse, cohabitant parents and relatives by blood or affinity of the persons referred to above and in the other cases identified by Consob in a regulation implementing Commission Directive 2004/72/EC of 29 April 2004. In the same regulation Consob shall identify the procedures and time limits for such notifications, the procedures and time limits for the disclosure of the information to the public and the cases in which such obligations also apply with reference to companies in a control relationship with the issuer and any other entities in which the persons specified above perform functions referred to in the first sentence of this subsection.

8. Persons producing or disseminating research or evaluations, excluding credit rating agencies, regarding financial instruments specified in Article 180 (1)(a), or issuers of such instruments, and persons producing or disseminating other information who recommend or suggest investment strategies intended for distribution channels or for the public must present the information fairly and disclose any interest or conflict of interest they may have with respect to the financial instruments to which the information refers.618

9. Consob shall lay down in a regulation:

a) provisions implementing subsection 8;

b) the manner of disseminating research and information referred to in subsection 8 produced or disseminated by listed issuers, intermediaries authorised to provide investment services or persons in a control relationship with them.

10. Without prejudice to subsection 8, provisions issued pursuant to subsection 9, paragraph a) shall not apply to journalists subject to equivalent self-regulatory rules provided their application achieves similar effects. Consob shall evaluate, preliminarily and on a general basis, that such conditions are satisfied.

11. Institutions that disseminate data or statistics liable to have a significant effect on the price of financial instruments referred to in Article 180(1)(a) shall disseminate such information in a fair and transparent way.

12. The provisions of this article shall also apply to Italian and foreign persons who issue financial instruments for which an application has been made for admission to trading on Italian regulated markets.

Article 114-bis 619
Information to be provided to the market concerning the allocation of financial instruments620 to corporate officers, employees and collaborators

1. Compensation plans based on financial instruments in favour of members of the board of directors or the management board, employees and collaborators not linked to the company by an employment contract and of members of the board of directors or the management board, employees and collaborators of parent companies or subsidiaries shall be approved by the ordinary shareholders’ meeting.

In accordance with the terms and conditions envisaged in Article 125-ter, subsection 1, the issuer makes the report available to the public with information concerning the following621:

a) the reasons for the adoption of the plan;

b) the members of the Board of Directors, that is the management board of the company, of the controlling or controlled companies which benefit from the plan622;

b-bis) the categories of employees or collaborators of the company and controlling companies or controlled companies which benefit from the plan623;

c) the procedures and clauses for the implementation of the plan, specifying whether its implementation is subject to the satisfaction of conditions and, in particular, to the achievement of specific results;

d) whether the plan enjoys any support from the special fund for encouraging worker participation in firms referred to in Article 4(112) of Law 350/2003;

e) the procedures for determining either the prices or the criteria for determining the prices for the subscription or purchase of shares;

f) the restrictions on the availability of the shares or options allocated, with special reference to the time limits within which the subsequent transfer of shares to the company or third parties is permitted or prohibited.

2. This article shall also apply to listed issuers and to issuers of financial instruments widely distributed among the public in accordance with Article 116624.

3. Consob shall lay down in its regulation information concerning matters specified in subsection 1 which should be provided in relation to the various procedures for implementing the plan, providing more detailed information for plans of special importance.625

Article 115
Information to be disclosed to Consob

1. For the purposes of monitoring the accuracy of information provided to the public, Consob, on a general basis or otherwise, may:

a) require listed issuers, listed issuers with Italy as home Member State, the persons that control them and companies controlled by them to provide information and documents, establishing the related procedures626;

b) gather information, including by means of hearings, from members of governing bodies, general managers, managers charged with preparing companies’ financial reports and other managers, statutory auditors, independent statutory auditors and companies and persons referred to in paragraph a) 627;

c) carry out inspections at the offices of persons referred to in paragraphs a) and b) to check company documents and obtain copies thereof.628

c-bis) exercise the other powers provided by Article 187-octies.629

2. The powers provided for in subsection 1, paragraphs a), b) and c)630 may be exercised with respect to persons who hold a major holding pursuant to Article 120 or who are parties to a shareholders' agreement pursuant to Article 122.

3. Consob may also require companies or entities with direct or indirect holdings in companies with listed shares to provide, on the basis of the available information, the names of their members or, in the case of trust companies, of their beneficiaries.

Article 115-bis
Lists of persons having access to inside information

1. Listed issuers and their subsidiaries and persons acting on their behalf or for their account shall draw up, and keep regularly updated, a list of the persons who, in the exercise of their employment, profession or duties, have access to information referred to in Article 114(1). Consob shall establish the procedures for drawing up, keeping and updating such lists.631

Article 116
Financial instruments widely distributed among the public

1. Article 114, except for subsection 7,632 and Article 115 shall also apply to issuers of financial instruments that, although not listed on a regulated market in Italy, are widely distributed among the public. Consob shall lay down in a regulation the criteria for identifying such issuers and may disapply the aforementioned articles, in whole or in part, for issuers of financial instruments listed on regulated markets in other EU countries or on markets in non-EU countries in consideration of the information requirements they are subject to by virtue of being listed633.

2. The provisions of Part IV, Title III, Chapter II, Section VI, except for Articles 157 and 158, shall apply to the issuers indicated in subsection 1634.

2-bis. Article 114, except subsection 7, and Article 115 shall apply also to issuers of financial instruments admitted to trading on multilateral trading systems meeting the characteristics established by Consob regulation, and provided that admission is requested or authorised by the issuer635.

2-ter. …omissis…636

Article 117
Accounting information

1. The exemptions from the obligation to prepare consolidated accounts provided in Article 27 of Legislative Decree 127/1991, Article 27 of Legislative Decree 87/1992 and Article 61 of Legislative Decree 173/1997 shall not apply to Italian companies with shares listed on regulated markets in Italy or other EU countries.

2. The Minister of Justice, in concert with the Minister of the Economy and Finance,637 shall lay down in a regulation the internationally accepted accounting standards compatible with those laid down in Community accounting directives that issuers of financial instruments listed on regulated markets in Italy, other EU countries or non EU countries may use, by way of derogation from the rules in force, in preparing their consolidated accounts, provided such principles are accepted by the markets of non-EU countries. The standards shall be identified on the basis of a proposal from Consob, to be formulated in agreement with the Bank of Italy for banks and the financial companies referred to in Article 1(1) of Legislative Decree 87/1992 and with Ivass for the insurance and reinsurance undertakings referred to in Article 1 of Legislative Decree 173/1997638.

Article 117-bis
Mergers between listed and unlisted companies

1. Article 13 shall apply to mergers in which a company with unlisted shares is merged into a company with listed shares when the latter’s assets, other than liquid balances and financial assets that are not fixed assets, are significantly less than the assets of the company to be merged.

2. Without prejudice to the powers referred to in Article 13.2, Consob shall lay down specific rules in a regulation for transactions referred to in subsection 1.639

Article 117-ter
Provisions concerning ethical finance

1. Consob, after consulting all the interested parties and consulting with the competent supervisory authorities, shall lay down in a regulation the specific disclosure and reporting obligations applicable to authorised intermediaries and insurance companies that promote products and services described as ethical or socially responsible.640

Article 118
Provisions not applicable

1. The provisions of this section shall not apply to the financial instruments referred to in Articles 100(1)(d) and 100(1)(e).

2. Subsections 1 and 2 of article 116 shall not apply to financial instruments issued by banks, other than shares or financial instruments with the option to purchase or subscribe shares641.

Article 118-bis 642
Checking information provided to the public643

1. By regulation and taking into account international principles on the supervision of corporate disclosures, Consob shall establish the terms and conditions for its control over public disclosures issued in accordance with law, including information contained in accounting records, by listed issuers and listed issuers with Italy as its home member country644.

Chapter II
Listed companies

Article 119
Scope

1. Unless specified otherwise, the provisions of this chapter shall apply to Italian companies with shares listed on regulated markets in Italy or other EU countries (listed companies).

Section I
Ownership structures

Article 120
Notification requirements for major holdings

1. For the purposes of this section, the capital of società per azioni shall mean that represented by voting shares. In companies whose articles of association allow for increased voting rights or which contemplate the issue of multiple-voting rights, capital refers to the total number of voting rights645.

2. Persons who hold more than three per cent of the capital of a listed issuer with Italy as home Member State shall notify the investee company and Consob. If the issuer is an SME, this threshold is five percent646.

2 bis. Consob may, by means of measures justified by needs to protect the investors as well as corporate control market and capital market efficiency and transparency, envisage – for a limited period of time – thresholds lower than that indicated in subsection 2 for companies with an elevated current market value and particularly extensive shareholding structure647.

3. …omissis…648.

4. Consob, taking account of the characteristics of the investors, shall lay down in a regulation:

a) the variations in the holdings referred to

in subsection 2 that must be notified;649

b) i criteria for the calculation of the stakes, also taking into account the shares held indirectly, if the voting right is held or attributed to a subject other than the shareholder or where there are increased voting rights650;

c) the content of and procedures for notifications and public announcements and any exemptions applicable to the latter;

d) the terms for the communication and for disclosure to the public651;

d-bis) the cases in which notifications are due from owners of financial instruments carrying the rights referred to in the last subsection of Article 2351 of the Civil Code.652

d-ter) cases in which a holding of derivatives is subject to reporting obligations653;

d-quater) situations exempt from the application of these provisions654.

5. Voting rights attached to listed shares or to financial instruments which have not been notified pursuant to subsection 2 may not be exercised. In the event of non-compliance, Article 14(5) shall apply. The challenge may also be initiated by Consob within the time limit specified in Article 14(6).655

6. Subsection 2 shall not apply to shares held by the Ministry of the Economy and Finance656 through companies it controls. The related notification requirements shall be fulfilled by the companies controlled.

Article 121
Rules governing cross-holdings

1. Except for the cases contemplated by article 2359-bis of the civil code, in the case of reciprocal participation in excess of the limit indicated in article 120, subsection 2, the company that has exceeded the limit successively cannot exercise its right to vote relative to the surplus shares and it must dispose of them within twelve months from the date on which it exceeded the limit. In the event of failure to make the disposal within such time limit, the suspension of voting rights shall apply to the entire shareholding. Where it is not possible to ascertain which of the two companies was the last to exceed the limit, the suspension of voting rights and the disposal requirement shall apply to both unless they have agreed otherwise.657

2. The limit referred to in subsection 1 is increased to five percent or, in the cases contemplated by article 120, subsection 2, second sentence, to ten percent if the threshold is exceeded by both companies subsequent to an agreement authorised in advance by the ordinary shareholders' meetings of the companies concerned658.

3. Where a person owns a shareholding to more than the threshold indicated in subsection 2 of a company with listed shares, the latter or the person that controls it may not acquire a shareholding that exceeds such limit in a company with listed shares controlled by the former. In the event of non-compliance, the voting rights attached to the shares in excess of the limit specified shall be suspended. Where it is not possible to ascertain which of the two persons was the last to exceed the limit, the suspension shall apply to both unless they have agreed otherwise659.

4. The shareholdings shall be calculated by applying the methods laid down pursuant to Article 120 subsection 4, paragraph b).

5. Subsections 1, 2 and 3 shall not apply where the limits indicated therein are exceeded following a takeover bid or exchange tender offering aimed at the acquisition of at least sixty per cent of the ordinary shares660.

6. In the event of non-compliance with the prohibitions on the exercise of voting rights provided for in Article 14, subsection 5, paragraphs 1 and 3 shall apply. The challenge may also be initiated by Consob within the time limit specified in Article 14, subsection 6.

Article 122
Shareholders' agreements

1. In whatever format they may be stipulated, agreements regarding the exercise of voting rights in companies with listed shares and their parent companies, within five days of stipulation shall be:

a) communicated to Consob;

b) published in extract form in the national daily newspapers;

c) filed at the Companies Register of the place where the company has its registered office;

d) communicated to listed companies661.

2. Consob shall lay down in a regulation the contents of the notification, abridged form and publication and the related procedures662.

3. Agreements shall be null and void in the event of non-compliance with the requirements laid down in subsection 1.

4. Voting rights attached to listed shares for which the requirements laid down in subsection 1 have not been satisfied may not be exercised. In the event of non-compliance, Article 14(5) shall apply. The challenge may also be initiated by Consob within the time limit specified in Article 14(6).

5. This article shall also apply to agreements, in whatsoever form concluded, that:

a) create obligations of consultation prior to the exercise of voting rights in companies with listed shares or companies that control them;

b) set limits on the transfer of the related shares or of financial instruments that entitle holders to buy or subscribe for them;

c) provide for the purchase of shares or financial instruments referred to in paragraph b);

d) have as their object or effect the exercise, jointly or otherwise, of a dominant influence on such companies.

d-bis) which aim to encourage or frustrate a takeover bid or exchange tender offering, including commitments relating to non-participation in a takeover bid663

5-bis. Agreements referred to in this article shall not be subject to Articles 2341-bis and 2341-ter of the Civil Code.664

5-ter. The disclosure obligations pursuant to subsection 1 of this article shall not apply to agreements, in whatever format they may be stipulated, regarding shareholdings totalling less than the threshold indicated in article 120, subsection 2665.

Article 123
Duration of agreements and right of withdrawal

1. Where agreements referred to in Article 122 are fixed term, they may not have a duration greater than three years and shall be deemed to have been concluded for such duration even if the parties provided for a longer term; agreements shall be renewable upon expiry.

2. Agreements may also be concluded for an indeterminate period; in such case each party may withdraw on giving six months' notice. Articles 122(1) and 122(2) shall apply to withdrawal.

3. Shareholders who intend to accept a public offer to buy or exchange made pursuant to Articles 106 or 107 may withdraw from the agreements referred to in Article 122 without notice. The declaration of withdrawal shall not produce effects if the transfer of the shares has not been finalized.

Article 123-bis
Report on corporate governance and ownership structures

1. The management report of issuers with securities admitted to trading on regulated markets shall contain a specific section entitled: «Report on corporate governance and ownership structures», providing detailed information on:

a) the capital structure, including securities not traded on a regulated market in an EU Member State, with an indication of the different classes of shares and, for each class of shares, the related rights and obligations and the percentage of total share capital represented;

b) any restriction on the transfer of securities, e.g. limitations in the possession of securities or the need to obtain consent from part of the company or other securities holders;

c) significant direct and indirect holdings, for example through pyramid structures and cross-holdings, as stated in reports submitted pursuant to article 120;

d) if known, the holders of any securities with special control rights and a description of such rights;

e) the mechanism for the exercise of voting rights in any employee share scheme where voting rights are not exercised directly by the employees;

f) any restrictions on voting rights, such as limitations of the voting rights of holders of a given percentage or number of votes, deadlines for the exercise of voting rights, or systems whereby, with the company's cooperation, the financial rights attached to the securities are separate from the holding of securities;

g) agreements known to the company pursuant to article 122;

h) any significant agreements to which the company is party and which take effect, alter or terminate upon a change of control of the company, and the effects thereof, except where their nature is such that their disclosure would be seriously prejudicial to the company; this exception shall not apply where the company is specifically obliged to disclose such information on the basis of other legal requirements;

i) agreements between companies and directors, members of the control body or supervisory council which envisage indemnities in the event of resignation or dismissal without just cause, or if their employment contract should terminate as the result of a takeover bid.

l) rules applying to the appointment and replacement of directors and members of the control body or supervisory council, and to amendments to the articles of association if different from those applied as a supplementary measure;

m) the existence of delegated powers regarding share capital increases pursuant to article 2443 of the Italian Civil Code or powers of the directors or members of the control body to issue security-related financial instruments or to authorise the purchase of own shares;

2. In the same section of the report referred to in subsection 1, information shall be provided regarding:

a) adoption of a corporate governance code of conduct issued by regulated stock exchange companies or trade associations, giving reasons for any decision not to adopt one or more provisions, together with the corporate governance practices actually applied by the company over and above any legal or regulatory obligations. The company shall also indicate where the adopted corporate governance code of conduct may be accessed by the public;

b) the main characteristics of existing risk management and internal audit systems used in relation to the financial reporting process, including consolidated reports, where applicable;

c) the operating mechanisms of the shareholders’ meeting, its main powers, shareholder rights and their terms of exercise, if different from those envisaged by legal and regulatory provisions applicable as supplementary measures;

d) the composition and duties of the administrative and control bodies and their committees.

3. The disclosures pursuant to subsections 1 and 2 may be issued in a report separate from the management report, approved by the board of directors and published with the management report. Alternatively, the management report may refer to a section of the issuer’s web site in which such a report is published.

4. The independent auditors shall express opinion pursuant to article 156, subsection 4-bis, paragraph d) on disclosures referred to under subsection 1, paragraphs c), d), f), l) and m), and under subsection 2 paragraph b), and shall confirm that a report on corporate governance and ownership structures has been prepared.

5. Companies that are not issuers of securities admitted to trading on regulated markets or multilateral trading systems may omit publication of the disclosures pursuant to subsections 1 and 2, except those indicated under subsection 2, paragraph b)666.

Article 123-ter
Report on remuneration

1. At least twenty-one days prior to the date of the shareholders' meeting established by article 2364, paragraph two, or the shareholders' meeting established by article 2364-bis second paragraph of the Italian Civil Code, companies with listed shares shall make a report on remuneration available to the public at the company registered offices, on its internet website or in any of the other ways established by Consob regulation.

2. The report on remuneration shall be laid out in the two sections established by paragraphs 3 and 4 and is approved by the Board of Directors. In companies adopting the dualism system, the report is approved by the supervisory board, upon proposal, limited to the section established by paragraph 4, letter b), of the management board.

3. The first section of the report on remuneration explains:

a) the company's policy on the remuneration of the members of the administrative bodies, general managers and executive with strategic responsibilities with reference to at least the following year;

b) the procedures used to adopt and implement this policy.

4. The second section, which is intended for the members of the administrative and auditing bodies, general managers and, in aggregate form, without prejudice to the provisions of the regulation issued in accordance with paragraph 8, for executives with strategic responsibilities:

a) provides a suitable representation of each of the items comprising remuneration, including treatment provided for in the event of cessation of office or termination of employment, highlighting the coherence with the company's policy in terms of remuneration approved the previous year;

b) analytically illustrates the fees paid during the financial year of reference, for any title and in any form by the company and by subsidiaries or associates, noting any components of said fees that refer to activities performed in years prior to that of reference, in addition to highlighting the fees to be paid in one or more subsequent years in exchange for the work performed in the year of reference, potentially specifying an estimated value for components that cannot objectively be quantified in the year of reference.

5. Fee plans established by article 114-bis are attached to the report, or the report specifies the section of the company's website where these documents can be viewed.

6. Without prejudice to the provisions of articles 2389 and 2409-terdecies, first paragraph, letter a) of the Italian Civil Code and article 114-bis, the shareholders' meeting called in accordance with article 2364, paragraph two or article 2364-bis, paragraph two, of the Italian Civil Code, resolves in favour or against the section of the report on remuneration established by paragraph 3. The resolution is not binding. The outcome of voting is made available to the public in accordance with article 125-quater, paragraph 2.

7. By regulation, adopted having first consulted with the Bank of Italy and Ivass as concerns the parties respectively supervised and considering sector Community regulations, Consob indicates the information to be included in the section of the remuneration report established by paragraph 3, including all information aiming to highlight the coherence of the remuneration policy with the pursuit of the company's long-term interests and with the risk management policy, in accordance with the provisions of paragraph 3 of Recommendation 2004/913/EC and paragraph 5 of Recommendation 2006/385/EC667.

8. By regulation adopted in accordance with paragraph 7, Consob also indicates the information to be included in the section of the remuneration report envisaged by paragraph 4. Consob may:

a) identify the managers with strategic responsibilities for which information is supplied in nominative form;

b) differentiate the level of information detail according to company dimension668.

Article 124
Provisions not applicable

1. Consob may declare Articles 120, 121, 122 and 123 subsection 2 second paragraph, inapplicable to Italian companies with shares listed only on regulated markets in other EU countries in consideration of the legislation applicable to such companies by virtue of their being listed.

Section I-bis669
Information on the adoption of codes of conduct

Article 124-bis
Reporting obligations regarding codes of conduct

…omissis…670

Article 124-ter
Disclosures regarding codes of conduct

1. To the extent of its powers, Consob shall establish the disclosure formats for codes of conduct regarding corporate governance issued by stock exchange companies or trade associations671.

Section II
Shareholder rights672

Article 125
Calling of shareholders' meetings at the request of minority shareholders

…omissis…673

Article 125-bis 674
Notice of call to shareholders’ meetings

1. The shareholders' meeting is convened by notice published on the company's website within thirty days of the date of the meeting and by other means and within the terms established by Consob with regulation issued in accordance with article 113-ter, subsection 3, including the publication in extract form in the daily newspapers675.

2. For shareholders’ meetings called to appoint, by means of list voting, members of the board of directors and internal control bodies, the time limit for publication of the notice of call shall be at least forty days prior to the date of the meeting.676.

3. For shareholders’ meetings envisaged in Articles 2446, 2447 and 2448 of the Civil Code, the time limit indicated in subsection 1 shall become at least twenty-one days prior to the date of the meeting.

4. The notice of call shall contain:

a) the indication of the day, time and place of the meeting and the list of matters on the agenda;

b) a clear, precise description of the procedures to be applied in order to attend and vote at the shareholders' meeting, including information concerning:

1) the terms for exercising the right to raise questions prior to the meeting and the right to have additional items placed on the agenda or to present further proposals on items already on the agenda and, also by reference to the company's website, any additional methods by which to exercise these rights;

2) the procedure for the exercise of the vote by proxy and, in particular, the methods for collecting the forms that can be used, optionally, for voting by proxy and the methods, including electronic methods, for communicating any notification of voting by proxy;

3) the procedure for the conferral of proxy to the party appointed by the company in accordance with article 135-undecies, with the specification that the power of proxy shall have no effect for proposals for which no voting instructions have been given;

4) the procedures for voting by correspondence or using electronic means, if envisaged by the Articles of Association;

c) the date specified in article 83-sexies, subsection 2, with the specification that those who become holders of shares only after that date shall not have the right to attend and vote at the shareholders' meeting;

d) the terms and conditions for collecting the full text of the proposed resolutions, together with the explanatory reports and documents to be submitted to the shareholders' meeting;

d-bis) the terms and conditions for presenting lists to elect the members of the board of directors and minority members of the board of auditors or the supervisory board;

e) the address of the website specified in article 125-quater;

f) the other information which must be indicated in the notice calling the meeting pursuant to other provisions677.

Article 125-ter 678
Disclosure of items on the agenda

1. Unless required under the terms of other legal provisions, by the date of publication of the notice of call to the shareholders' meeting envisaged by virtue of each of the items on the agenda, the board of directors shall make a report on each of the items on items of the agenda available to the public at the company's registered office, on the company web site and by other means envisaged by Consob regulation679.

2. The reports prepared in accordance with law shall be made available to the public by the deadlines specified in such legal provisions, by the means envisaged in subsection 1. The report pursuant to Article 2446, subsection 1 of the Civil Code shall be made available to the public at least twenty-one days prior to the shareholders' meeting. The provisions of Article 154-ter, subsections 1, 1-bis and 1-ter shall remain valid.

3. In the event of shareholders' meetings convened in accordance with article 2367 of the Italian Civil Code, the report on the items on the agenda is prepared by shareholders requiring the convening of the meeting. The administrative body or auditors or supervisory board or management control committee, where they convened the meeting in accordance with article 2367, second subsection, first sentence, of the Italian Civil Code, shall make available to the public the report, accompanied by their assessments if appropriate, at the same time as publishing the notice calling the shareholders' meeting in the ways set out by supervisory board 1680.

Article 125-quater 681
Web site

1. Without prejudice to the provisions of articles 125-bis and 125-ter, the following are made available on the company's website:

a) within the terms for the publication of the notice calling the meeting, as envisaged for each of the items on the agenda to which they refer, or subsequent terms as envisaged by the law for publication, the documents will be submitted to the shareholders' meeting;

b) within the terms for the publication of the notice calling the meeting, the forms that can be optionally used for voting by proxy and, where envisaged by the Articles of Association, for correspondence voting; where the forms cannot be made available in electronic format for technical reasons, the same website will specify how to obtain hard copies and, in this case, the company must send them free of charge, on request, by mail, also through the intermediaries;

c) within the terms of publication of the notice calling the meeting, information on the amount of the share capital specifying the number and categories of shares into which it is divided.

2. A summary report of the votes containing the number of shares represented at the shareholders’ meeting and the shares on which a vote was expressed, the percentage of capital represented by those shares, the number of votes in favour and against the resolution and the number of abstentions, shall be made available on the company web site within five days the date of the meeting. The minutes of the shareholders’ meeting pursuant to Article 2375 of the Civil Code shall in any event be made available on the web site within thirty days of the date of the meeting682.

Article 126 683
Notice of second and subsequent calls 684

1. ...omissis... 685

2. Where the Articles of Association envisage the possibility of second or subsequent callings, if the day for the second or subsequent calling is not specified in the notice convening the meeting, the meeting at a second or subsequent calling is held within thirty days. In this case, the terms established by article 125-bis, subsections 1 and 2 are reduced to twenty-one days as long as the agenda is not altered. In the case of a shareholders' meeting convened in accordance with article 125-bis, subsection 2, the lists for the election of the members of the board of directors and the minority members of the board of auditors or supervisory board already deposited with the issuer are considered valid also with respect to the new calling. The presentation of new lists is permitted and the terms established by article 147-ter, subsection 1-bis are reduced respectively to fifteen and ten days686.

3. ...omissis... 687

4. ...omissis... 688

5. ...omissis... 689

Article 126-bis 690
Integration of the agenda of the shareholders' meeting and presentation of new proposed resolutions

1. Shareholders, who individually or jointly account for one fortieth of the share capital may ask, within ten days of publication of the notice calling the shareholders' meeting, or within five days in the event of calling the meeting in accordance with article 125-bis, subsection 3 or article 104, subsection 2, for the integration of the list of items on the agenda, specifying in the request, the additional items they propose or presenting proposed resolution on items already on the agenda. The requests, together with the certificate attesting ownership of the share, are presented in writing, by correspondence or electronically, in compliance with any requirements strictly necessary for the identification of the applicants indicated by the company. Those with voting rights may individually present proposed resolutions in the shareholders' meeting. For cooperative companies the amount of the capital is determined by the statutes also in derogation of article 135691.

2. Integrations to the agenda or the presentation of further proposed resolutions on items already on the agenda, in accordance with subsection 1, are disclosed in the same ways as prescribed for the publication of the notice calling the meeting, at least fifteen days prior to the date scheduled for the shareholders' meeting. Additional proposed resolutions on items already on the agenda are made available to the public in the ways pursuant to article 125-ter, subsection 1, at the same time as publishing news of the presentation. Terms are reduced to seven days in the case of shareholders' meetings called in accordance with article 104, subsection 2 or in the case of a shareholders' meeting convened in accordance with article 125-bis, subsection 3.

3. The agenda cannot be supplemented with items on which, in accordance with the law, the shareholders' meeting resolved on proposal of the administrative body or on the basis of a project or report prepared by it, other than those specified under article 125-ter, subsection 1.

4. Shareholders requesting integration in accordance with subsection 1 shall prepare a report giving the reason for the proposed resolutions on the new items for which it proposes discussion or the reason relating to additional proposed resolutions presented on items already on the agenda. The report is sent to the administrative body within the final terms for presentation of the request for integration. The administrative body makes the report available to the public, accompanied by any assessments, at the same time as publishing news of the integration or presentation, in the ways pursuant to article 125-ter, subsection 1.

5. If the administrative body, or should it fail to take action, the board of auditors or supervisory board or management control committee fail to supplement the agenda with the new items or proposals presented in accordance with subsection 1, the court, having heard the members of the board of directors and internal control bodies, where their refusal to do so should prove to be unjustified, orders the integration by decree. The decree is published in the ways set out by article 125-ter, subsection 1.

Article 127
Postal or electronic voting

1. By regulation Consob shall establish the methods for exercising votes and the procedures for shareholders’ meeting in cases envisaged in Article 2370, subsection 4 of the Civil Code692.

Article 127-bis
Voidability of resolutions and right to withdrawal

1. For the purpose of Article 2377 of the Civil Code, any person on whose behalf shares are registered after the date indicated in Article 83-sexies, subsection 2 and prior to opening of the shareholders’ meeting, shall be considered absent from that meeting.

2. For the purpose of the right to withdrawal envisaged in Article 2437 of the Civil Code, any person on whose behalf shares are registered after the date indicated in Article 83-sexies, subsection 2 and prior to opening of the shareholders’ meeting, registration of those shares shall not be calculated for the approval of resolutions.

3. This provision shall also apply to Italian companies with shares admitted to multilateral trading systems in Italy or in other EU countries with the consent of the issuer693.

Article 127-ter
(Right to submit questions prior to the shareholders' meeting)

1. All those with voting rights may submit questions on the items on the agenda even prior to the shareholders' meeting. Questions received before the meeting will be answered at the latest during the said meeting. The company may provide a single reply to questions with the same content.

1-bis. The notice calling the meeting specifies the terms within which questions raised prior to the shareholders' meeting must reach the company. The terms must be no less than three days prior to the date of the first or only calling of the shareholders' meeting or five days if the notice of calling establishes that the company should provide a reply to the questions received before the actual meeting. In this case, replies are provided at least two days prior to the shareholders' meeting also by publication in a specific section of the company website.

2. No reply is necessary, even in the shareholders' meeting, to questions raised prior to it, where the information required is already available in "FAQ" format in the section of the company's website specified in subsection 1-bis or when the answer has been published in accordance with said subsection.

3. The reply attached to the minutes is considered as given during the meeting when is made available at the beginning of the meeting, by each of those entitle to vote694.

Article 127-quater 695
Dividend increases

1. As an exception to subsection 1 of article 2350 of the Italian Civil Code, the Articles of Association may order that each share held by the same shareholder for a continuous period indicated in the article, in any case of no less than one year or the lesser period running between two consecutive payment dates of the annual dividend, shall assign the right to an increase of no more than 10 percent of the dividend distributed to the other shares. The Articles of Association may envisage other conditions forgranting such a benefit. The benefit may also be extended to shares allocated pursuant to Article 2442 of the Civil Code to a shareholder with right to the increase as indicated in subsection 1696.

2. Should the same party, during the maturation of the period indicated in subsection 1, have directly or indirectly through trustees, subsidiaries or third party, have held an investment in excess of 0.5 percent of the company capital, or lesser percentage specified by the Articles of Association, the majority may only be assigned for shares in total representing this maximum stake. The majority can not be assigned to shares held by those who, during said period, even temporarily exercised a dominant, individual or jointly with other shareholders by means of a shareholders' agreement as envisaged by article 122, or significant influence over the company. In any event, the increase may not be granted on shares which during the period indicated in subsection 1 were continuously or temporarily assigned to a shareholders' agreement as envisaged in Article 122 and in the same period, or part of that period, formed part of a total shareholding exceeding that indicated in Article 106, subsection 1697.

3. Disposal of the share, against payment or free of charge, shall result in loss of the benefits envisaged in subsection 1. Such benefits are retained in the event of universal succession, and in the event of merger or spin-off of the owner of the shares. In the event of merger or spin-off of the company issuing the shares indicated in subsection 1, the benefits shall be transferred to shares issued by the resulting companies, without prejudice to the application of subsection 2 in reference to such companies.

4. Shares on which the benefits indicated in subsection 1 are granted shall not constitute a special category of shares pursuant to Article 2348 of the Civil Code.

4–bis. those who have obtained assignment of the majority declare, at the request of the company, that there is no reason for hindrance established by subsection 2 and show the certificates envisaged by article 83-quinquies certifying the duration the shares have been held for which benefits are requested and the certification relative to the existence of any additional conditions to which the Articles of Association subject assignment of the benefit698.

4-ter. The resolution to amend the Articles of Association as envisaged by subsection 1 does not assign the right to withdrawal in accordance with article 2437 of the Italian Civil Code699.

Article 127-quinquies
Vote increase

1. The articles of association may specify that increased voting rights may be attributed, up to a maximum of two votes, for each share belonging to the same subject for an uninterrupted period of no less than twenty-four months starting from the date of registration contemplated by subsection 2. In such a case, the articles of association may also contemplate that the subject holding the voting right may irrevocably renounce, all or part, the increased votes.

2. The articles of association establish the methods for the attribution of the increased vote and for checking the relative conditions, contemplating, in any case, a specific list. Consob establishes with its own regulation the implementation provisions of this article in order to ensure the transparency of the ownership structures and observance of the provisions of Title II, Chapter II, Section II. Without prejudice to the communication obligations borne by the holders of relevant stakes.

3. The transfer of shares for a consideration or free of charge, or the direct or indirect sale of the majority interest of a company or body whose voting right has increased to above the threshold contemplated by Article 120, section 2, involves the loss of the increased voting right. Unless otherwise laid down by the articles of association, the increased voting right:

a) is maintained in the case of succession pursuant to death, as well as in the case of the merger or spin-off of the shares;

b) extends to the newly issued shares in the case of a capital increase pursuant to Article 2442 of the Italian Civil Code.

4. The merger or spin-off project of a company whose articles of association rule that an increase in voting rights can contemplate that the increased voting right is also due to the entitled shares in lieu of those to which the increased vote is attributed. The articles of association may also rule that the increased voting right is extended proportionately to the shares issued in execution of a capital increase by means of new contributions.

5. The shares to which the benefit contemplated by subsection 1 is applied do not represent a special category of shares pursuant to Article 2348 of the Italian Civil Code.

6. The resolution to amend the articles of association in order to contemplate increased voting does not recognise the withdrawal right as envisaged by Article 2437 of the Italian Civil Code.

7. If the resolution to amend the articles of association referred to in subsection 6 is adopted during the procedure for the listing on a regulated market of the shares of a company not resulting from a merger involving a listed company, the relative clause can envisage that, for the purposes of the uninterrupted possession contemplated by subsection 1, it is also necessary to count the possession prior to the date of registration on the list contemplated by subsection 2.

8. Unless otherwise ruled by the articles of association, the vote increase is also calculated to determine the quorum for the constitution of the shareholders' meeting and for resolutions which regard the share capital quotas. The increase does not affect rights, other than voting rights, due pursuant to the possession of certain capital quotas700.

Article 127-sexies
Multiple-voting shares

1. In derogation from Article 2351, section four, of the Italian Civil Code, the articles of association cannot contemplate the issue of multiple-voting shares.

2. Multiple-voting shares issued before the start of trading on a regulated market maintain their features and rights. Unless specified otherwise by the articles of association, in order to maintain unaltered the ratio between the various share categories, companies which have issued multiple-voting shares or companies resulting from the merger or spin-off of such companies may issue multiple-voting shares with the same features and rights of those already issued only in the following cases:

a) a share capital increase pursuant to Article 2442 of the Italian Civil Code or by new conferments without excluding or limiting option rights;

b) merger or spin-off.

3. In the case contemplated by section 2, the articles of association may not contemplate further increases in voting rights in favour of single share categories nor pursuant to Article 127-quinquies.

4. If the company does not take avail of the faculty of issuing new multiple-voting shares pursuant to the second sentence of section 2, there is no need for approval of the resolutions, pursuant to Article 2376 of the Italian Civil Code, on the part of the Special Meeting of the holders of the multiple-voting shares701.

Article 128
Complaints to the board of auditors and the courts

...omissis... 702

Article 129
Company actions for liability

...omissis... 703

Article 130
Information for shareholders

1. Shareholders may consult all the documents filed at the company's registered office for shareholders' meetings that have already been called and may obtain a copy thereof at their own expense.

Article 131
Right of withdrawal from mergers and spin-offs

...omissis...704

Article 132
Acquisition of own or parent company shares

1. Purchases of treasury shares under Articles 2357 and 2357-bis, subsection 1, paragraph 1 of the Civil Code by companies with listed shares must be made so as to ensure equal treatment of shareholders, according to procedures established by Consob in a regulation.705

2. Subsection 1 shall also apply to purchases of listed shares made under Article 2359-bis of the Civil Code by a subsidiary.

3. Subsections 1 and 2 shall not apply to purchases of own or parent company shares held by employees of the issuing company, subsidiary companies or the parent company and allotted or subscribed for in accordance with Articles 2349 and 2441, eighth subsection, of the Civil Code, or falling under the scope of the compensation plans approved in accordance with article 114-bis706.

Article 133
Exclusion upon request from trading

1. Subject to approval by an extraordinary shareholders' meeting, Italian companies with shares listed on regulated markets in Italy may request that their own financial instruments be excluded from trading, in accordance with the provisions of the rules of the market, where they are admitted to listing on other regulated markets in Italy or another EU country, provided investors are ensured equivalent protection, according to standards established by Consob in a regulation707.

Article 134
Increases in capital

1. ...omissis...708

2. ...omissis...709

3. ...omissis...710

Section II-bis711
Cooperatives

Article 135
Capital percentages

1. For cooperatives, the capital percentages identified in the Civil Code and in this decree for the exercise of shareholder rights shall be a ratio of the total number of shareholders712.

Article 135-bis
Regulation of cooperative companies

1. Subsection 2 of article 125-bis, and subsection 4, paragraph b), number 1), relative only to the words: "the right to ask questions prior to the shareholders' meeting" and number 3 and letter c), of the same article. Articles 127-bis, 127-ter and 127-quater shall not apply to cooperative companies.

2. All other exclusions specifically established by this decree shall hold firm.

3. The term contemplated by article 126-bis, subsection 2, first sentence, is reduced to ten days713 .

Article 135-ter
Market disclosure on the attribution of financial instruments to corporate officers, employees or collaborators

...omissis...714

Article 135-quater
Extraordinary shareholders' meeting

...omissis...715

Article 135-quinquies
Integration of the agenda of the shareholders' meeting

...omissis...716

Article 135-sexies
Financial reports

...omissis...717

Article 135-septies
Audit reports

...omissis...718

Article 135-octies
Proposed share capital increase

...omissis...719

Section II-ter720
Proxies

Article 135-novies
Representation at the shareholders’ meeting

1. Any person with the right to vote may indicate one representative for each shareholders' meeting, without prejudice to the right to specify one or more replacements721.

2. As an exception to subsection 1, any person with the right to vote may appoint a different representative for each account, used to record financial instrument transactions, valid where the communication envisaged in Article 83-sexies has been issued.

3. As a further exception to subsection 1, if the person indicated as owner of the shares in the communication envisaged in Article 83-sexies acts alone or through registered trustees on behalf of his or her customers, the person in question may indicate others on whose behalf he/she acts, or one or more third parties indicated by such customers, as their representative.

4. If the proxy form envisages such an option, the proxy may arrange for personal substitution by another person of his or her choice, without prejudice to compliance with Article 135-decies subsection 3 and to the right of the person represented to indicate one or more substitutes722.

5. In place of the original, the representative may deliver or transmit a copy of the proxy, also in electronic format, confirming his or her liability in compliance of the proxy form to the original and the identity of the delegating party. The representative shall retain the original of the proxy form and keep track of any voting instructions received for a period of one year from closure of the shareholders' meetings concerned.

6. The appointment may be made with a document in an electronic format with a digital signature in accordance with article 21, subsection 2 of Italian Legislative Decree 82 of 7 March 2005. The companies specify in the Articles of Association at least one way of electronic notification of the proxy723.

7. Subsections 1, 2, 3 and 4 shall also apply to cases of share transfer by proxy.

8. All of the above without prejudice to the provisions of Article 2372 of the Italian Civil Code. As an exception to article 2372, second subsection of the Italian Civil Code, asset management companies, SICAVs, harmonized management companies and non-EU parties providing collective investment management services may grant representation for more than one shareholders' meeting724.

Article 135-decies
Conflict of interest of the representative and substitutes

1. Conferring proxy upon a representative in conflict of interest is permitted provided that the representative informs the shareholder in writing of the circumstances giving rise to such conflict of interest and provided specific voting instructions are provided for each resolution in which the representative is expected to vote on behalf of the shareholder. The representative shall have the onus of proof regarding disclosure to the shareholder of the circumstances giving rise to the conflict of interest. Article 1711, second subsection of the Italian Civil Code does not apply725.

2. In any event, for the purposes of this article, conflict of interest exists where the representative or substitute:

a) has sole or joint control of the company, or is controlled or is subject to joint control by that company;

b) is associated with the company or exercises significant influence over that company or the latter exercises significant influence over the representative726;

c) is a member of the board of directors or control body of the company or of the persons indicated in paragraphs a) and b);

d) is an employee or auditor of the company or of the persons indicated in paragraph a);

e) is the spouse, close relative or is related by up to four times removed of the persons indicated in paragraphs a) to c);

f) is bound to the company or to persons indicated in paragraphs a), b), c) and e) by independent or employee relations or other relations of a financial nature that compromise independence.

3. Replacement of the representative by a substitute in conflict of interest is permitted only if the substitute is indicated by the shareholder. In such cases, subsection 1 shall apply. Disclosure obligations and related onus of proof in any event remain with the representative.

4. This article shall also apply in cases of share transfer by proxy.

Article 135-undecies
Appointed representative of a listed company

1. Unless the Articles of Association decree otherwise, companies with listed shares designate a party to whom the shareholders may, for each shareholders' meeting and within the end of the second trading day prior to the date scheduled for the shareholders' meeting, including for callings subsequent to the first, a proxy with voting instructions on all or some of the proposals on the agenda. The proxy shall be valid only for proposals on which voting instructions are conferred727.

2. Proxy is conferred by signing a proxy form, the content of which is governed by a Consob regulation. Conferring proxy shall be free of charge to the shareholder. The proxy and voting instructions may be cancelled within the time limit indicated in subsection 1.

3. Shares for which full or partial proxy is conferred are calculated for the purpose of determining due constitution of the shareholders' meeting. With regard to proposals for which no voting instructions are given, the shares are not considered in calculating the majority and the percentage of capital required for the resolutions to be carried728.

4. The person appointed as representative shall any interest, personal or on behalf of third parties, that he or she may have with respect to the resolution proposals on the agenda. The representative must also maintain confidentiality of the content of voting instructions received until scrutiny commences, without prejudice to the option of disclosing such information to his or her employees or collaborators, who shall also be subject to confidentiality obligations. The party appointed as representative may not be assigned proxies except in compliance with this article729.

5. By regulation pursuant to subsection 2, Consob may establish cases in which a representative failing to meet the indicated terms of Article 135-decies may express a vote other than that indicated in the voting instructions730.

Article 135-duodecies
Cooperatives

1. The provisions of this section shall not apply to cooperatives.

Section III731
Solicitation of proxies732

Article 136
Definitions

1. For the purposes of this section, the following definitions shall apply:

a) “proxy”, means of representation conferred for the exercise of votes at shareholders’ meetings;

b) “solicitation”, a request to more than two hundred shareholders for proxy to be conferred in relation to specific voting proposals, or accompanied by recommendations, statements or other indications capable of influencing the vote;

c) “promoter”, the person or persons, including the issuer, acting in concert to promote the solicitation733.

Article 137
General provisions

1. For the purposes of this section, Articles 135-novies and 135-decies shall apply to proxies734.

2. Articles of Association that in any way limit representation in shareholders' meetings shall not apply to proxies given pursuant to the provisions of this chapter.

3. The Articles of Association may contain rules aimed at facilitating voting by proxy by employee shareholders735.

4. The provisions o-f this section shall not apply to società cooperative.

4-bis. The provisions of this section also apply to Italian companies with financial instruments other than shares admitted with the consent of the issuer to trading on regulated markets in Italy or other European Union Member States with regards to the conferral of representation to exercise voting rights in shareholders' meeting by the owners of the said financial instruments736.

Article 138
Solicitation

1. Solicitation is performed by the promoter through dissemination of a statement and a proxy form.

2. The vote relating to shares for which proxy is conferred is exercised by the promoter. The promoter may be substituted only by a person specifically indicated in the proxy form and in the solicitation statement737.

Article 139
Requirements for promoters

…omissis…738

Article 140
Persons authorised to engage in solicitation

…omissis…739

Article 141
Shareholders’ associations

1. Requests for proxy are accompanied by recommendations, statements or other indications capable of influencing the vote shall not constitute solicitation pursuant to Article 136, subsection 1, paragraph b) by shareholders' associations, targeting their own members, which:

a) are constituted by authenticated simple agreement;

b) do not exercise business activities other than those directly instrumental to the purpose of the association;

c) are composed of at least fifty natural persons, each of which owning a number of shares not exceeding 0.1 per cent of the share capital represented by shares with voting rights.

2. Proxy conferred upon the association by shareholders pursuant to subsection 1 shall not be considered in calculating the limit of two hundred shareholders envisaged in Article 136, subsection 1, paragraph b) 740.

Article 142
Proxies

1. Proxies shall be signed by the givers, may be revoked and may be given only for one shareholders' meeting that has already been called, remaining effective for subsequent calls where applicable; they may not be given blank and shall show the date, the name of the appointee and the voting instructions.

2. Proxy may also be conferred for only a number of the voting proposals indicated in the proxy form or for only certain items on the agenda. The representative shall vote on behalf of the person conferring proxy also on items of the agenda for which he or she has received instructions, even if not included in the solicitation. Shares for which full or partial proxy is conferred are calculated for the purpose of determining due constitution of the shareholders’ meeting741.

Article 143
Liability

1. The information contained in the proxy statement or the proxy form and any sent out during a solicitation or collection of proxies must enable shareholders to make an informed decision; its suitability for this purpose shall be the liability of the promoter742.

2. The promoter shall be liable for the completeness of information sent out during a solicitation743.

3. In actions for damages arising from violation of the provisions of this section and the related regulations the burden of proof of having acted with the due diligence required shall be on the promoter744.

Article 144
Performance of solicitations and collections of proxies

1. Consob shall issue a regulation on the transparency and correctness of solicitations and collections of proxies. In particular, the regulation shall lay down rules for:

a) the content of proxy statements and proxy forms and the procedures for their distribution;

b) the procedures for solicitation and the collection of proxies, and the conditions and procedures for casting proxy votes and revoking proxies;

c) the forms of cooperation between the promoter and the persons possessing the information on the identity of shareholders in order to permit the performance of solicitations745.

2. Consob may:

a) request that the statement and proxy form include additional information to establish their specific dissemination methods;

b) suspend solicitation activities in the event of a grounded suspicion of breach of the provisions of this section or prohibit it in the event of ascertained breach of said provisions746;

c) exercise the powers envisaged in Article 114 subsection 5 and Article 115 subsection 1 against the promoters747.

3. …omissis…748.

4. In cases in which the law envisages forms of control over investments in company share capital, a copy of the statement and proxy form must be sent to the competent supervisory authority prior to solicitation. The authorities shall prohibit any solicitation that compromises the purpose of the control of capital investments749.

Section IV
Savings shares and other classes of shares750

Article 145
Issue of shares

1. Italian companies with ordinary shares listed on regulated markets in Italy or other EU countries may issue non-voting shares with preferential rights as regards the payment of dividends and the liquidation of assets.

2. The Articles of Association shall specify the substance of such preferential rights and the conditions and time and other limits for their exercise; they shall also establish the rights of holders of savings shares where ordinary or savings shares are excluded from trading.

3. The shares must carry, in addition to the information laid down in Article 2354 of the Civil Code, the words "azioni di risparmio" and an indication of the related privileges; the shares may be bearer shares, without prejudice to the second subsection of Article 2354 of the Civil Code. The shares belonging to directors, members of the board of auditors and general managers must be registered shares.751

4. ...omissis... 752

5. Where, as a consequence of a reduction in the capital owing to losses, the value of savings shares and shares with limited voting rights exceeds half the share capital, the ratio referred to in subsection 4 must be restored within two years through an issue of ordinary shares offered with the right of pre-emption to the holders of ordinary shares. However, where the capital represented by ordinary shares falls below one quarter of the share capital, it must be replenished to at least one quarter within six months. Companies shall be dissolved where the ratio of ordinary shares to savings shares and shares with limited voting rights is not restored within the aforementioned time limits.

6. The share capital represented by savings shares shall not be counted for the purpose of establishing the due constitution of the shareholders' meeting and the validity of the resolutions adopted, nor for the purpose of calculating the ratios referred to in Articles 2367, 2393 subsections 5 and 6, 2393-bis, 2408 subsection 2, and 2409 subsection 1 of the Civil Code.753

7. Savings shares may be issued as part of a share capital increase, in compliance with the provisions of article 2441 of the Italian Civil Code754, or on conversion of ordinary or other shares already in issue. Conversion rights shall be attributed to shareholders by resolution of the extraordinary shareholders' meeting.

8. Unless the instrument of incorporation and Articles of Association state otherwise, in the case of issues of new shares for cash where the right of pre-emption has not been excluded or limited, holders of savings shares shall enjoy the right of pre-emption for savings shares of the same class or, in the absence thereof or to make up the difference, for savings shares of another class, preference shares or ordinary shares, in that order.

Article 146
Special shareholders' meetings

1. Special shareholders' meetings of holders of savings shares shall resolve:

a) on the appointment and removal of the common representative and legal action for liability against such person;

b) on the approval of resolutions adopted by the shareholders' meeting of the company that prejudice the rights of the category, with the favourable vote of as many shares as represent at least twenty per cent of the shares of the class in question;

c) on the creation of a fund for the expenses necessary to protect common interests and the related statement of accounts; the fund shall be advanced by the company, which may recover the advance from the profits due to holders of savings shares in excess of any amount guaranteed;

d) on the settlement of disputes with the company, with the favourable vote of shares representing at least twenty per cent of the shares of the class in question;

e) on other matters of common interest.

2. Special meetings of holders of savings shares shall be called by their common representative or by the directors of the company or the board of directors or management board within sixty days of the issue or conversion of the shares and when they deem it necessary or it has been requested by holders of savings shares representing at least one per cent of the savings shares of the same class.755

2-bis. In the case of omission or unjustified delay by the board of directors or management board, special meetings shall be called by the board of auditors or the supervisory board or, if requested by holders of savings shares under paragraph 1, by the management control committee.756

3. By way of derogation from the second paragraph of Article 2376 of the Civil Code, special shareholders' meetings, except in the cases referred to in paragraphs 1b) and 1d), shall adopt resolutions at the first and second calls with the favourable vote of shares representing at least twenty and ten per cent of the shares in circulation; at a third or single calling, the special shareholders' meetings shall adopt resolutions by simple majority of the persons present, regardless of the proportion of the capital they represent. Article 2416 of the Civil Code shall apply757.

Article 147
Common representatives

1. Common representatives shall be subject to Article 2417 of the Civil Code, where the term bondholders shall be understood to refer to holders of savings shares.

2. ...omissis... 758

3. Common representatives shall have the obligations and powers referred to in Article 2418 of the Civil Code, where the term bondholders shall be understood to refer to holders of savings shares; they may also examine the books referred to in subsections 1) and 3) of Article 2421 of the Civil Code, obtain extracts thereof, attend shareholders' meetings and challenge the resolutions they adopt. Their expenses shall be charged to the fund referred to in Article 146(1)(c).

4. The Articles of Association may assign the common representative additional powers to protect the interests of holders of savings shares and must establish procedures to ensure the common representative receives adequate information on corporate transactions that may influence the price of shares of the class in question.

Article 147-bis
Meetings of classes of investors

1. Articles 146 and 147 shall apply to the special meetings referred to in Article 2376, first paragraph, of the Civil Code if the shares are listed on regulated markets in Italy or other EU countries.759

Section IV-bis760
Administration bodies

Article 147-ter 761
Election and composition of the Board of Directors

1. The Statute provides for members of the Board of Directors to be elected on the basis of the list of candidates and defines the minimum participation share required for their presentation, at an extent not above a fortieth of the share capital or at a different extent established by Consob with the regulation taking into account capitalization, floating funds and ownership structures of listed companies. The lists indicate which are the directors holding independent requisites established by law and by the Statute. The Statute may also provide that with regard to the sector for directors to be elected, what is not to be taken into account are the lists which have not reached a percentage of votes at least equal to half of the one required by the Statute for the presentation of same; for cooperative companies the percentage is established by the statutes also in derogation from article 135. 762

1-bis. Lists are deposited with the issuer, also by means of remote communication, in compliance with any requirements strictly necessary to identify the applicants indicated by the company, by the twenty-fifth day prior to the date of the meeting called to resolve on the appointment of the members of the board of directors and made available to the public at the company's headquarters, on the company's website and in the other ways envisaged by Consob by regulation, at least twenty-one days prior to the date of the shareholders' meeting. Ownership of the minimum investment envisaged by subsection 1 is determined concerning the shares recorded in favour of the shareholder on the day on which the lists are deposited with the issuer. Related certification may also be submitted after filing, provided submission is within the time limit established for publication of the lists by the issuer763.

1-ter. The Statute also lays down that the division of directors to be elected be made on the basis of a criterion that ensures a balance between genders. The less-represented gender must obtain at least one third of the directors elected. This division criterion applies for three consecutive mandates. If the composition of the board of directors resulting from the election does not comply with the division criterion provided for in the present section, Consob warns the company involved to comply with this criterion within the maximum term of four months from the warning. In the event of non-compliance with the warning, Consob applies a fine of from euro 100,000 to euro 1,000,000, according to criteria and methods laid down in its own regulations and sets a new term of three months for compliance. In the event of further non-compliance with respect to the new warning, the members elected lose their position. The statute regulates the methods of formation of the lists and the cases of replacement during a mandate in order to guarantee compliance with the division criterion provided for in the present section. Consob lays down regulations on the subject of infringement, application and observance of the rules on gender quotas, also with reference to the preliminary phase and the procedures to be adopted, on the basis of its own regulations to be adopted within six months from the date of entry into force of the rules contained in the present section. The rules of the present section apply also to companies organised according to the monistic system764.

2. ...omissis...765

3. Except as provided for in Article 2409-septiesdecies of the Civil Code, at least one member shall be elected from the minority slate that obtained the largest number of votes and is not linked in any way, even indirectly, with the shareholders who presented or voted the list which resulted first by the number of votes. In companies organised under the one-tier system, the member elected from the minority slate must satisfy the integrity, experience and independence requirements established pursuant to Articles 148(3) and 148(4). Failure to satisfy the requirements shall result in disqualification from the position. 766

4. In addition to what is provided for in paragraph 3, at least one of the members of the Board of Directors, or two if the Board of Directors is composed of more than seven members, should satisfy the independence requirements established for members of the board of auditors in Article 148(3) and, if provided for in the Articles of Association, the additional requirements established in codes of conduct drawn up by regulated stock exchange companies or by trade associations. This paragraph shall not apply to the boards of directors of companies organised under the one-tier system, which shall continue to be subject to the second paragraph of Article 2409-septiesdecies of the Civil Code. The independent director who, following his or her nomination, loses those requisites of independence should immediately inform the Board of Directors about this and, in any case falls from his/her office. 767

Article 147-quater 768
Composition of the management board

1. If the management board has more than four members, at least one of them must satisfy the independence requirements established for members of the board of auditors in Article 148(3) and, if provided for in the Articles of Association, the additional requirements established in codes of conduct drawn up by regulated stock exchange companies or by trade associations.

1-bis. If the management board has not less than three members, the rules of article 147-ter, subsection 1-ter apply to it769.

Article 147-quinquies
Integrity requirements

1. Persons who perform an administrative or management role must satisfy the integrity requirements established for members of internal control bodies in the regulation issued by the Minister of Justice pursuant to Article 148, subsection 4.

2. Failure to satisfy the requirements shall result in disqualification from the position.770

Section V
Internal control bodies771

Article 148
Composition

1. The Articles of Association of a company shall establish, for the board of auditors:

a) the number, not less than three, of auditors;

b) the number not less than two, of alternates;

c) ...omissis...772

d) ...omissis...773

1-bis. The Articles of Association of the company state, moreover, that the division of members pursuant to section 1 shall be made in such a way that the less-represented gender shall obtain at least one third of the regular members of the board of auditors. This division criterion applies for three consecutive mandates. If the composition of the board of auditors resulting from the election does not comply with the division criterion provided for in the present section, Consob warns the company involved to comply with this criterion within the maximum term of four months from the warning. In the event of non-compliance with the warning, Consob applies a fine of from euro 20,000 to euro 200,000 and sets a new term of three months for compliance. In the event of further non-compliance with respect to the new warning, the members elected lose their position. Consob lays down regulations on the subject of infringement, application and observance of the rules on gender quotas, also with reference to the preliminary phase and the procedures to be adopted, on the basis of its own regulations to be adopted within six months from the date of entry into force of the rules contained in the present section774.

2. Consob establishes the rules for the election procedure by list vote of a member of the Board of Auditors by minority shareholders, that are not directly or indirectly associated with the shareholders that submitted or voted the list qualifying as first for the number of votes received. Article 147-ter, subsection 1-bis shall apply775.

2-bis. The chairman of the board of auditors shall be appointed by the shareholders’ meeting from among the auditors elected by the minority shareholders.776

3. The following persons may not be elected as auditors and, where elected, they shall be disqualified from office:

a) persons who are in the conditions referred to in Article 23 82 of the Civil Code;

b) spouses, relatives and the like up to the fourth degree of kinship of the directors of the company, spouses, relatives and the like up to the fourth degree of kinship of the directors of the companies it controls, the companies it is controlled by and those subject to common control;777

c) persons who are linked to the company, the companies it controls, the companies it is controlled by and those subject to common control or to directors of the company or persons referred to in paragraph b) by self-employment or employee relationships or by other relationships of an economic or professional nature that might compromise their independence.778

4. In a regulation adopted pursuant to Article 17(3) of Law 400/2003, in agreement with the Minister of the Economy and Finance,779 after consulting Consob, the Bank of Italy and Ivass, the Minister of Justice shall lay down the integrity and experience requirements for the members of the board of auditors780, the supervisory board or the management control committee. Failure to satisfy the requirements shall result in disqualification from the position781.

4-bis. Subsections 1-bis, 2 and 3 shall apply to supervisory boards.782

4-ter. Subsections 2-bis and 3 shall apply to management control committees. The representative of the minority shareholders shall be the director elected pursuant to Article 147-ter(3).783

4-quater. In the cases provided for in this article, disqualification shall be declared by the board of directors or, for companies organised according to the two-tier system or the one-tier system, by the shareholders’ meeting within thirty days of the appointment or of its learning of subsequent failure. In the event of inaction by the competent body, Consob shall declare the disqualification, at the request of any interested party or if it learns of the existence of the grounds for disqualification.784

Article 148-bis
Limits on the cumulation of positions

1. Consob shall lay down in a regulation the limits to the cumulation of management and control positions that members of the internal control bodies of companies referred to in this chapter and of companies with financial instruments widely distributed among the public in accordance with Article 116 may hold in all the companies referred to in Book V, Title V, Chapters V, VI and VII of the Civil Code. Consob shall establish such limits taking into account the onerousness and complexity of each type of position, including in relation to the size of the company, the number and size of the firms included in the consolidation, and the extension and articulation of its organisational structure.

2. Without prejudice to Article 2400, fourth subsection, of the Civil Code, members of the internal control bodies of companies referred to in this chapter and of companies with financial instruments widely distributed among the public in accordance with Article 116 shall inform Consob and the public, within the time limits and in the ways prescribed by Consob in the regulation referred to in subsection 1, of all the management and control positions they hold in companies referred to in Book V, Title V, Chapters V, VI and VII of the Civil Code. Consob shall declare the disqualification from positions taken on after the maximum number provided for in the regulation referred to in the first subsection was reached.785

Article 149
Duties

1. The board of auditors shall check:

a) compliance with the law and the Articles of Association;

b) observance of the principles of correct administration;

c) the adequacy of the company's organisational structure for matters within the scope of the board's authority, the adequacy of the internal control system and the administrative and accounting system and the reliability of the latter in correctly representing the company's transactions;

c-bis) the arrangements for implementing the corporate governance rules provided for in codes of conduct drawn up by regulated stock exchange companies or by trade associations that the company, by means of public disclosures, declares it complies with;786

d) the adequacy of the instructions imparted by the company to its subsidiaries pursuant to Article 114(2).

2. The members of the board of auditors shall attend the shareholders' meetings and the meetings of the board of directors and the executive committee. Members of the board of auditors who fail to attend shareholders' meetings without good cause or, in any one financial year, fail to attend two meetings of the board of directors or the executive committee shall be disqualified from office.787

3. The board of auditors shall notify Consob without delay of irregularities found in the performance of its oversight activity and shall transmit the related minutes of the meetings and investigations conducted with all other relevant documentation.

4. Subsection 3 shall not apply to companies with shares listed only on regulated markets in other EU countries.

4-bis. Subsections 1, 3 and 4 shall apply to the supervisory board. At least one member of the supervisory board shall participate in the meetings of the management board.788

4-ter. Subsections 1(c-bis), 1(d), 3 and 4 shall apply to the management control committee.789

Article 150
Information requirements

1. The directors shall promptly inform the board of auditors, in the manner laid down in the Articles of Association and at least every three months, of the activities carried out and the transactions of greatest significance for the company's profitability, financial position or assets and liabilities effected by the company or its subsidiaries; in particular, they shall report on any transactions in which they have an interest, for their own account or on behalf of third parties, or that are influenced by the person who performs the activity of direction and coordination.

2. The obligation referred to in the previous subsection shall be fulfilled, in the two-tier system by the management board reporting to the supervisory board and, in the one-tier system, by the bodies with delegated powers reporting to the management control committee.

3. The board of auditors and the statutory auditor or independent statutory auditor shall promptly exchange data and information relevant to the performance of their respective duties790.

4. The persons assigned to internal control functions shall also report to the board of auditors at their own initiative or at the request of one or more members of the board of auditors.

5. Subsections 3 and 4 shall also apply to the supervisory board and the management control committee.791

Article 151
Powers

1. Members of the board of auditors, jointly or severally, may at any time carry out inspections and controls, and require the directors to supply information, inter alia with reference to subsidiaries, on the performance of the business or on particular transactions or make the same requests for information directly to the management and control bodies of subsidiaries.792

2. The board of auditors may exchange information with the corresponding bodies of subsidiaries concerning management and control systems and the general performance of the business. After notifying the chairman of the board of directors, it may also call the shareholders' meeting and meetings of the board of directors or the executive committee and use employees of the company in performing its duties. The right to call meetings and request collaboration may also be exercised individually by each member of the board of auditors, except for the right to call the shareholders’ meeting, which may not be exercised by less than two members.793

3. For the purpose of evaluating the adequacy and reliability of the administrative and accounting system, members of the board of auditors, on their own responsibility and at their own expense, may use, jointly or severally, their own employees and assistants who are not in any of the conditions referred to in Article 148(3). The company may deny such assistants access to confidential information.

4. Investigations carried out must be entered in the register of meetings and resolutions of the board of auditors, which must be kept by the board at the registered office of the company. The last subsection of Article 2421 of the Civil Code shall apply.

Article 151-bis 794
Powers of the supervisory board

1. The members of the supervisory board, jointly or severally, may require the members of the management board to supply information, inter alia with reference to subsidiaries, on the performance of the business or on particular transactions or make the same requests for information directly to the management and control bodies of subsidiaries.795 The information shall be supplied to all the members of the supervisory board.

2. The members of the supervisory board, jointly or severally, may request the chairman to call a board meeting, indicating the matters to be discussed. The meeting must be called without delay unless this is prevented by reasons that are promptly notified to the person who made the request and explained to the next meeting of the supervisory board.

3. After notifying the chairman of the management board, the supervisory board may call the shareholders' meeting and meetings of the management board and use employees of the company in performing its duties. The right to call meetings and request collaboration may also be exercised individually by each member of the board of auditors, except for the right to call the shareholders’ meeting, which may not be exercised by less than two members.796

4. The supervisory board, or a member thereof with a specific mandate, may at any time carry out inspections and controls and exchange information with the corresponding bodies of subsidiaries concerning management and control systems and the general performance of the business.

Article 151-ter 797
Powers of the management control committee

1. The members of the management control committee, jointly or severally, may require the other directors to supply information, inter alia with reference to subsidiaries, on the performance of the business or on particular transactions or make the same requests for information directly to the management and control bodies of subsidiaries.798 The information shall be supplied to all the members of the internal control committee.

2. The members of the management control committee, jointly or severally, may request the chairman to call a committee meeting, indicating the matters to be discussed. The meeting must be called without delay unless this is prevented by reasons that are promptly notified to the person who made the request and explained to the next meeting of the internal control committee.

3. After notifying the chairman of the board of directors, the management control committee may call meetings of the board of directors or the executive committee and use employees of the company in performing its duties. The right to call meetings and request collaboration may also be exercised individually by each member of the committee.799

4. The management control committee, or a member thereof with a specific mandate, may at any time carry out inspections and controls and exchange information with the corresponding bodies of subsidiaries concerning management and control systems and the general performance of the business.

Article 152
Reports to the courts

1. The board of auditors, or the supervisory board or the management control committee, where it has a well-founded suspicion that the directors, in violation of their duties, have committed serious irregularities in transactions that may injure the company or one or more of its subsidiaries, may report the facts to the courts pursuant to Article 2409 of the Civil Code. In such case the costs of the inspection shall be borne by the company and the court may also remove the directors.800

2. Consob, where it has a well-founded suspicion of serious irregularities in the performance of the supervisory duties of the board of auditors, the supervisory board or the management control committee may report the facts to the courts pursuant to Article 2409 of the Civil Code, the costs of the inspection shall be borne by the company.801

3. Subsection 2 shall not apply to companies with shares listed only on regulated markets in other EU countries.

4. Article 70(7) of the Consolidated Law on Banking shall be unaffected.

Article 153
Obligation to report to the shareholders' meeting

1. The board of auditors, the supervisory board and the management control committee shall report on the supervisory activity performed and on any omissions and censurable facts found to the shareholders' meeting called to approve the annual accounts or pursuant to Article 2364-bis, subsection 2, of the Civil Code.802

2. The board of auditors may make proposals to the shareholders' meeting concerning the annual accounts and their approval and matters within the scope of its authority.

Article 154
Provisions not applicable

1. Articles 2397, 2398, 2399, 2403, 2403-bis, 2405, 2426, points 5 and 6, 2429 subsection 2, and 2441 subsection 6, of the Civil Code shall not apply to boards of auditors of companies with listed shares.

2. Articles 2409-septies, 2409-duodecies and 2409-terdecies, subsections 1c), 1e) and 1f) of the Civil Code shall not apply to supervisory boards of companies with listed shares.

3. Articles 2399, first subsection, and 2409-septies of the Civil Code shall not apply to the management control committees of companies with listed shares.803

Section V-bis804
Financial information805

Article 154-bis 806
Manager charged with preparing a company’s financial reports

1. The Statute of listed issuers with Italy as the home Member State provides for professional requirements and the procedures for appointing a manager charged with preparing the company’s financial reports, subject to the mandatory opinion of the internal control body. 807

2. Documents and communications of the company, which have been disseminated in the market and regard information on accounts including mid-year reports shall be accompanied by a written declaration by the general manager and the manager charged with preparing the company’s financial reports attesting their conformity against document results, books and accounts records. 808

3. The manager charged with preparing the company’s financial reports shall put appropriate administrative and accounting procedures in place for preparing the annual accounts report and, where provided for, the consolidated accounts and every other disclosure of a financial nature. 809

4. The Board of Directors supervises so that the executive assigned to draw up the company accounts report has adequate powers and means to carry out the tasks given to him according to this Article, as well as on the actual observance of the administrative and accounting procedures. 810

5. In a special report on the annual, half-yearly and, where applicable, the consolidated financial statements, the delegated control bodies and the executive responsible for the preparation of company accounting documents shall confirm:

a) the adequacy and effective application, during the period of reference of the documents, of procedures pursuant to subsection 3;

b) that the documents were prepared in compliance with applicable international accounting standards recognised by the European Community pursuant to European Parliament and Council Regulation no. 1606/2002 of 19 July 2002;

c) the correspondence between the documents and related bookkeeping and accounting records;

d) the suitability of the documents to truthfully and correctly represent the financial position of the issuer and the group of companies included in the scope of consolidation;

e) for the annual and consolidated financial statements, that the directors’ report contains a reliable analysis of the business outlook and management result, the financial position of the issuer and group companies included in the scope of consolidation, and a description of the main risks and uncertain situations to which they are exposed;

f) for the simplified half-yearly report, that the interim directors' report contains a reliable analysis of the information pursuant to subsection 4 of article 154-ter811.

5-bis. The declaration pursuant to subsection 5 shall be prepared according to the model established by Consob regulation812.

6. The provisions governing the liability of directors shall also apply to managers charged with preparing companies’ financial reports in relation to the tasks entrusted to them, without prejudice to actions that may be brought on the basis of the employment contract with the company.

Article 154-ter 813
Financial reporting

1. Without prejudice to the provisions of articles 2364, second subsection and 2364-bis, second subsection of the Italian Civil Code, within four months of the year end, the listed issuers with Italy as their Home Member State must make available to the public at the company's headquarters, on the company website and with the other ways envisaged by Consob by regulation, the annual financial report, comprising the draft financial statements or, for companies that have adopted the dualist administrative and control system, the financial statements and consolidated financial statements, where prepared, the report on operations and certification envisaged by article 154-bis, subsection 5. In the hypotheses envisaged by article 2409-terdecies, second subsection of the Italian Civil Code, in lieu of the statutory financial statements, in accordance with this subsection, the draft financial statements are published. The auditing report prepared by the legal auditor or legal auditing firm and the report indicated in article 153 are made entirely available to the public within the same terms814..

1-bis. Publications pursuant to subsection 1 and the date of the meeting convened in accordance with articles 2364, second subsection and 2364-bis, second subsection of the Italian Civil Code must have at least twenty-one days between them815.

1-ter. As an exception to article 2429, subsection 1 of the Civil Code, the directors shall forward the draft financial statements, of the statutory auditor or statutory auditing company, together with the directors’ report, to the board of statutory auditors and the independent auditors at least fifteen days prior to the publication referred to in subsection 1816..

2. The listed issuers with Italy as Member State of origin publish, as soon as possible and in any case within three months from the closure of the first six months of the financial year, a half-yearly financial report containing the simplified half-year statements, interim directors' report and the declaration pursuant to article 154-bis subsection 5. Where applicable, the statutory auditor or independent statutory auditors report on the simplified half-yearly statements shall be published in full within the same time limit817.

3. The simplified half-yearly statements referred to under subsection 2, shall be prepared in compliance with applicable international accounting standards recognised by the European Community pursuant to EC Regulation no. 1606/2002. Such statements are prepared in consolidated format if the listed issuer with Italy as home member state is required to prepare consolidated financial statements.

4. The interim directors’ report shall at least contain indications of the more significant events occurring in the first six months of the financial year and their impact on the simplified half-yearly financial statements, together with a description of the main risks and uncertainties faced in the remaining six months of the year. For listed issuers with Italy as home member state, the interim directors’ report shall also contain information on significant related party transactions.

5. With the regulation pursuant to paragraph 6, Consob can order issuers whose Member State of origin is Italy, including financial enterprises, to periodically disclose additional financial information consisting mainly of:

a) a general description of the capital situation and economic trend of the issuer and its subsidiaries in the period of reference;

b) an illustration of the relevant events and of the transactions which have been carried out in the period of reference and their impact on the capital of the issuer and of its subsidiaries818.

5-bis. Before the possible introduction of the obligations pursuant to paragraph 5, Consob publishes the impact analysis carried out pursuant to Article 14, paragraph 24-quater, of Italian Law no. 246 of 28 November 2005. This latter, in compliance with the Community discipline of reference, examines, also in a comparative key, the existence of the following conditions:

a) the additional periodic financial disclosure does not involve disproportionate expense, especially for the small and medium issuers concerned;

b) the content of the requested additional periodic financial disclosures is proportionate to the factors that contribute to the investors' investment decisions;

c) the requested additional periodic financial disclosures do not favour excessive attention for the issuers' short term results and yield and do not negatively influence the possibilities of access of the small and medium issuers to the regulated markets819.

6. By regulation and in compliance with European law, Consob shall establish820:

a) the terms and procedures for the publication of the documents referred to under paragraphs 1 and 2 and of any additional disclosures contemplated by paragraph 5821;

b) cases of exemption from the requirement to publish the financial reports822;

c) the content of information on significant related party transactions pursuant to subsection 4;

d) the terms of application of this article for issuers of units of closed-end funds.

7. Without prejudice to the powers envisaged by article 157, subsection 2, where it is ascertained that documents comprising the financial statements pursuant to this article do not comply with drafting regulations, Consob may request that the issuer publishes this fact and arrange publication of supplementary information as necessary in order to reinstate correct market information.

Article 154-quater
Transparency of payments to governments

1. The listed issuers with Italy as Member State of origin, operating in one of the sectors referred to by Article 1, paragraph 1, letters h) and i), of Italian Legislative Decree no. 139 of 18 August 2015, publish, on their own Internet sites and by other means contemplated by Consob by regulation, the report on payments to governments drawn up in compliance with the provisions contained in Chapter I of the said decree, within six months of the date of the closure of the financial period.

2. The said report remains available to the public for ten years after its first publication.

3. The payments to governments are reported at a consolidated level823.

Section VI
Statutory audit
824

Article 155
Performance of audits

1. …omissis…825

2. The statutory auditor or independent statutory auditors shall inform Consob and the control body without delay of any censurable facts found during statutory audit of the separate and consolidated financial statements826.

3. …omissis…827

Article 156
Auditors reports828

1. …omissis…829

2. …omissis…830

3. …omissis…831

4. In the event of an adverse opinion, disclaimer or qualified opinion expressing significant doubts on going concern assumptions, the statutory auditor or independent statutory auditors shall promptly inform Consob832.

4-bis. …omissis…833

5. …omissis…834

Article 157
Effects of audit opinions on the accounts

1. Except in the cases referred to in Article 156(4), the resolution of the shareholders' meeting or meeting of the supervisory board approving the annual accounts may be challenged by shareholders representing at least five per cent of the share capital on the grounds that the accounts fail to conform with the provisions governing the preparation thereof. Shareholder's representing the same percentage of the capital of companies with listed shares may request the courts to verify the conformity of the consolidated accounts with the provisions governing the preparation thereof.835

2. Consob may take the actions referred to in subsection 1 within six months of the entry of the annual accounts or the consolidated accounts in the Company Register.

3. This article shall not apply to companies with shares listed only on regulated markets in other EU countries.

4. For società cooperative, the percentage of capital specified in subsection 1 shall be understood to refer to the total number of members.

Article 158
Share capital increase proposals836

1. In the case of share capital increases excluding or limiting option rights, the fairness opinion on the issue price of the shares shall be released by a legal auditor or by a legal auditing firm. The statutory auditor or independent statutory auditors shall be informed of share capital increase proposals, together with the directors’ report envisaged in article 2441, subsection 6 of the Italian Civil Code, at least forty-five days prior to the date established for examination by the shareholders’ meeting837.

2. The directors’ report and opinion of the statutory auditor or independent statutory auditor shall be made available to the public by the methods indicated in Article 125-ter, subsection 1, at least twenty-one days prior to the shareholders’ meeting and until the related resolution has been passed. Such documents must be annexed to the other documents required for entry of the resolution in the Register of Companies838.

3. The previous subsection shall also apply to the report of the statutory auditor or independent statutory auditors referred to in Article 2441, subsection 4, paragraph 2 of the Italian Civil Code.839

3–bis. The sworn report by the expert appointed by the court in accordance with article 2343 of the Italian Civil Code or the documentation specified by article 2343-ter, third subsection of the Italian Civil Code is made available to the public in the ways set out by article 125-ter, subsection 1, at least twenty-one days prior to the shareholders' meeting and until such time as this has resolved840.

4. ...omissis... 841

5. ...omissis... 842

Article 159 843
Conferment and revocation of the engagement

1. In the event of failure to appoint a statutory auditor or independent statutory auditors, the company required to confer appointment must promptly inform Consob, explaining the reasons for the delay in arranging the audit assignment844.

2. …omissis…845

3. …omissis…846

4. …omissis…847

5. …omissis…848

6. …omissis…849

7. …omissis…850

8. …omissis…851

Article 160
Incompatibility

…omissis…852

Article 161
Special register of independent auditors

…omissis…853

Article 162
Supervision of independent auditors

…omissis…854

Article 163
Consob measures

…omissis…855

Article 164
Liability

…omissis…856

Article 165
Auditing of groups

…omissis…857

Article 165-bis
Companies with control of listed companies

…omissis…858

Section VI-bis859
Relations with foreign companies having their registered office in a country that does not ensure corporate transparency

Article 165-ter
Scope

1. This section shall apply to Italian companies with shares listed on regulated markets referred to in Article 119 and to Italian companies with financial instruments widely distributed among the public referred to in Article 116 that control companies having their registered office in a country whose legal system does not ensure transparency with regard to their formation, assets and liabilities, and operations; it shall also apply to Italian companies with shares listed on regulated markets or with financial instruments widely distributed among the public that are affiliated with or controlled by such foreign companies.

2. The notion of control defined in Article 93 and the notion of affiliation defined in the third subsection of Article 2359 of the Civil Code shall apply.

3. The countries referred to in subsection 1 shall be identified in decrees issued by the Minister of Justice, in concert with the Minister of the Economy and Finance, on the basis of the following factors:

a) as regards the forms and conditions for the setting up of companies:

1) absence of provision for publicizing constituent instruments and Articles of Association and subsequent amendments thereto;

2) absence of a minimum capital requirement for the setting up of companies capable of safeguarding creditors and of provision for the dissolution of companies in the event of a reduction of the capital below the legal minimum, except where it is replenished within a given time limit;

3) absence of rules that ensure the effectiveness and integrity of the subscribed share capital, in particular by having contributions in kind and contributions of claims valued by an expert appointed for the purpose;

4) absence of provision for persons or bodies authorised for the purpose by specific provisions of law to control the conformity of the instruments referred to in point 1) with the requirements for the setting up of companies;

b) as regards the structure of companies, absence of provision for a control body separate from the management body or of a control committee of the board of directors endowed with appropriate powers of inspection, control and authorisation with respect to the company’s accounting records, annual accounts and organisational arrangements and consisting of persons who satisfy appropriate integrity, experience and independence requirements;

c) as regards the annual accounts:

1) absence of provision for the obligation to draw up such accounts, including at least an income statement and a balance sheet, in conformity with the following principles:

1.1) clear, truthful and fair representation of the assets and liabilities and financial position of the company and of the result for the year;

1.2) clear description of the valuation methods used in preparing the income statement and the balance sheet;

2) absence of the obligation to file the annual accounts, drawn up in conformity with the principles referred to in point 1), with an administrative or judicial body;

3) absence of the obligation to have companies’ accounting records and annual accounts checked by the control body or committee referred to in paragraph b) or by a statutory auditor;

d) the legislation of the country in which the company has its registered office impedes or restricts the business of the company in that country;

e) the legislation of the country in which the company has its registered office excludes the indemnification of directors dismissed without just cause or allows such a clause to be included in companies’ constituent instruments or other contractual instruments;

f) absence of provision for an appropriate discipline preventing companies from continuing in business after they are insolvent, without recapitalization or prospects of recovery;

g) absence of appropriate penal sanctions for corporate officers who falsify accounting records or annual accounts.

4. The decrees issued by the Minister of Justice referred to in subsection 3 may identify, in relation to the legal forms and frameworks for companies provided for in foreign legal systems, equivalent criteria on the basis of which the requirements concerning transparency and capital and organisational suitability specified in this article can be considered to be satisfied.

5. The decrees referred to in subsection 3 may identify countries whose legal systems show particularly serious shortcomings with regard to the aspects referred to in subsections 3(b), 3(c) and 3(g).

6. Consob shall lay down in a regulation the basic criteria in the light of which Italian companies referred to in Article 119 and Italian companies with financial instruments widely distributed among the public referred to in Article 116 may control companies having their registered office in one of the countries referred to in subsection 5. To this end consideration shall be given to the reasons of an entrepreneurial nature for having control and the need to ensure complete and fair disclosure of corporate information.

7. In the event of failure to comply with the rules issued pursuant to subsections 5 and 6, Consob may report the facts to the courts with a view to the adoption of the measures provided for in Article 2409 of the Civil Code.860

Article 165-quater 861
Obligations of Italian parent companies

1. Italian companies with shares listed on regulated markets referred to in Article 119 and Italian companies with financial instruments widely distributed among the public referred to in Article 116 that control companies having their registered office in one of the countries specified in the decrees referred to in Article 165-ter(3) shall include an annex to their annual accounts or their consolidated accounts if they are required to prepare them with the annual accounts of the foreign subsidiary, drawn up in accordance with the accounting principles and rules applicable to the annual accounts of Italian companies or internationally accepted accounting standards.

2. The annual accounts of the foreign subsidiary, attached to the annual accounts of the Italian company pursuant to subsection 1, shall be signed by the latter’s board of directors and general manager and its manager charged with preparing the company’s financial reports, who shall attest to the truthfulness and fairness of the representation of the assets and liabilities and financial position and of the result for the year. The annual accounts of the Italian company shall also contain an annex with the opinion expressed by its internal control body on the annual accounts of the foreign subsidiary.

3. The annual accounts of the Italian parent company shall be accompanied by a report prepared by the directors on the business dealings between the Italian company and the foreign subsidiary, with special reference to credit and debt positions and transactions they concluded during the year to which the annual accounts refer, including the provision of guarantees for financial instruments issued in Italy or abroad by the above-mentioned companies. The report shall be signed by the general manager and the manager charged with preparing the company’s financial reports. The opinion expressed by the internal control body shall be attached to the report.

4. The financial statements of the foreign subsidiary, attached to the Italian company’s financial statements pursuant to subsection 1, shall be subject to audit by the statutory auditor or appointed statutory auditor of the Italian company’s financial statements; where such person does not operate in the country in which the foreign subsidiary is registered, the services of another suitable statutory auditor or appointed statutory auditor must be used and liability accepted for the latter’s action. Where the Italian company, under no obligation to do so, does not have a statutory auditor or appointed statutory auditor, such an assignment must be arranged for the financial statements of the foreign subsidiary862.

5. The financial statements of the foreign subsidiary, signed pursuant to subsection 2, with the report, related attachments and the opinion expressed by the person responsible for the audit pursuant to subsection 4 shall be transmitted to Consob863.

Article 165-quinquies
Obligations of Italian affiliates

1. The annual accounts of Italian companies with shares listed on regulated markets referred to in Article 119 and Italian companies with financial instruments widely distributed among the public referred to in Article 116 that are affiliated with companies having their registered office in one of the countries specified in the decrees referred to in Article 165-ter(3) shall be accompanied by a report prepared by the directors on the business dealings between the Italian company and the foreign affiliate, with special reference to credit and debt positions and transactions they concluded during the year to which the annual accounts refer, including the provision of guarantees for financial instruments issued in Italy or abroad by the above-mentioned companies. The report shall be signed by the general manager and the manager charged with preparing the company’s financial reports. The opinion expressed by the internal control body shall be attached to the report.864

Article 165-sexies
Obligations of Italian subsidiaries

1. The annual accounts of Italian companies with shares listed on regulated markets referred to in Article 119 and Italian companies with financial instruments widely distributed among the public referred to in Article 116 or which have obtained substantial loans that are controlled by companies having their registered office in one of the countries specified in the decrees referred to in Article 165-ter(3) shall be accompanied by a report prepared by the directors on the business dealings between the Italian company and the foreign parent company, the companies the latter controls and is affiliated with and those subject to common control, with special reference to credit and debt positions and transactions they concluded during the year to which the annual accounts refer, including the provision of guarantees for financial instruments issued in Italy or abroad by the above-mentioned companies. The report shall be signed by the general manager and the manager charged with preparing the company’s financial reports. The opinion expressed by the internal control body shall be attached to the report.865

Article 165-septies
Consob’s powers and implementing provisions

1. Consob shall exercise the powers provided for in Articles 114 and 115 for the purposes specified in Article 91 with regard to the Italian companies referred to in this section. In order to verify fulfilment of the obligations referred to in this section by such Italian companies, it may exercise the same powers with regard to foreign companies, after obtaining the consent of the competent foreign authorities, or request the latter’s assistance or cooperation, inter alia under cooperation agreements concluded with them.

2. Consob shall issue a regulation with provisions implementing this section.866

PART V867
SANCTIONS

TITLE I
PENAL SANCTIONS868

Chapter I
Intermediaries and markets

Article 166
Unauthorised activity

1. Imprisonment for between six months and four years and a fine of between four million and twenty million lire shall be imposed on any person who, without being authorised pursuant to this decree:

a) provides investment services or activities or collective asset management services869;

b) markets units or shares of collective investment undertakings in Italy;

c) sells financial instruments or investment services door-to-door or uses distance marketing techniques to promote or place such instruments and services or activities870.

2. The same punishment shall apply to any person who acts as a financial advisor authorised to make off-premises offers without being entered in the register referred to in Article 31.871

2-bis. The same punishment is served on anyone who exercises the activity of central counterparty as contemplated by regulation (EU) no. 648/2012 of the European Parliament and of the Council, of 4 July 2012, without having obtained prior authorisation when required872.

3. Where there is a well-founded suspicion that a company is providing investment services or activities or collective asset management services or i.e. the activity referred to by section 2-bis without being authorised pursuant to this decree, the Bank of Italy or Consob shall inform the public prosecutor with a view to the adoption of the measures provided for in Article 2409 of the Civil Code or may apply to the courts for the adoption of the same measures. The costs of the inspection shall be borne by the company.873

Article 167
Breach of duty

1. Unless the act constitutes a more serious offence, any person who, in performing the service of management on a client-by-client basis of investment portfolios or the service of collective asset management in violation of the provisions governing conflicts of interest, undertakes operations that cause injury to investors with a view to obtaining an undue profit for himself or for others shall be punished by imprisonment for between six months and three years and by a fine of between ten million and two hundred million lire874.

Article 168
Commingling of assets

1. Unless the act constitutes a more serious offence, any person who, in providing investment services or activities or collective asset management services or custody for the financial instruments or cash of a collective investment undertaking, with a view to obtaining an undue profit for himself or for others, violates the provisions governing the separation of assets and thereby causes injury to clients shall be punished by imprisonment for between six months and three yea s and by a fine of between ten million and two hundred million lire875.

Article 169
Holdings of capital

1. Unless the act constitutes a more serious offence, any person who makes false representations in the notifications referred to in Articles 15(1), 15(3), 61(6) and 80(7) or in those required pursuant to Article 17 shall be punished by imprisonment for between six months and three years and by a fine of between ten million and one hundred million lire876.

Article 170
Central depository services for financial instruments

1. Any person who in effecting registrations or issuing certifications in connection with central depository services falsely represents facts of which the registration or certification is intended to prove the truth or who transfers or delivers financial instruments or transfers the related rights without recovering the certifications, shall be punished by imprisonment for between three months and two years877.

Article 170-bis 878
Obstruction of the supervisory functions of the Bank of Italy and of Consob879

1. Except for the cases provided for by Article 2638 of the Civil Code, any person who obstructs the supervisory functions entrusted to the Bank of Italy and to Consob shall be punished by imprisonment for a term of up to two years and a fine of between ten thousand and two hundred thousand euro.880

Article 171
Protection of supervision

...omissis... 881

Chapter II
Issuers

Article 172
Irregular acquisition of shares

1. Directors of companies with listed shares or of subsidiaries thereof who acquire treasury shares or shares of the parent company in violation of Article 132 shall be punished by imprisonment for between six months and three years and by a fine of between four hundred thousand and two million lire882.

2. The provision of paragraph 1 shall not apply where the acquisition is made on the market regulated in a manner that differs from that established by Consob Regulation, but which is nonetheless suitable to ensuring the equal treatment of shareholders883.

Article 173
Failure to dispose of shareholdings

1. Directors of companies with listed shares or of companies that own shareholdings in companies with listed shares who violate the obligation to dispose of shareholdings referred to in Articles 110 and 121 shall be punished by imprisonment for a term of up to one year and by a fine of between twenty-five thousand Euro and two million five hundred thousand Euro884.

Article 173-bis
False statements in prospectuses

1. Any person who, with a view to obtaining an undue profit for himself or for others, in prospectuses required for public offerings or for admission to trading on regulated markets, with the intention of deceiving the recipients of the prospectus, includes false information or conceals data or news in a way that is likely to mislead such recipients, shall be punished by imprisonment for between one and five years.885

Article 174
False notifications and obstruction of Consob's functions

...omissis... 886

Chapter III
Auditing of accounts

Article 174-bis
False statements in auditing firms’ reports or communications

…omissis…887

Article 174-ter
Corruption of auditors

…omissis…888

Article 175
False statements in auditing firms' reports or communications

...omissis... 889

Article 176
Use and divulgence of confidential information

...omissis... 890

Article 177
Illegal financial relationships with the audited company

…omissis…891

Article 178
Illegal compensation

…omissis…892

Article 179
Common provisions

...omissis...893

TITLE I-BIS894
INSIDER TRADING AND MARKET MANIPULATION

Chapter I
General provisions

Article 180
Definitions

1. For the purposes of this title:

a) “financial instruments” shall mean:

1) financial instruments pursuant to article 1, subsection 2, admitted to trading or for which admission to trading has been requested on an Italian regulated market or that of another EU member country, and any other instrument admitted to trading or for which admission to trading has been requested on a regulated market of another EU member country;

2) financial instruments pursuant to article 1, subsection 2, admitted to trading on an Italian multilateral trading system, for which admission has been requested or authorised by the issuer895;

b) "derivatives on commodities" shall mean financial instruments referred to in Article 1(3) based on goods admitted, or for which an application has been made for admission, to trading on an Italian regulated market or on a regulated market of another EU country and any other derivative instrument based on goods admitted, or for which an application has been made for admission, to trading on a regulated market of an EU country;

c) "accepted market practices" shall mean practices which it is reasonable to expect to find on one or more financial markets and accepted or identified by Consob in accordance with the implementing provisions of Directive 2003/6/EC of the European Parliament and of the Council of 28 January 2003896;

d) "entity" shall mean one of the persons referred to in Article 1 of Legislative Decree 231/2001.897

Article 181
Inside information

1. For the purposes of this title inside information shall mean information of a precise nature which has not been made public relating, directly or indirectly, to one or more issuers of financial instruments or one or more financial instruments and which, if it were made public would be likely to have a significant effect on the prices of those financial instruments.

2. In relation to derivatives on commodities, inside information shall mean information of a precise nature which has not been made public relating, directly or indirectly, to one or more such derivatives and which users of markets on which such derivatives are traded expect to receive in accordance with accepted market practices on those markets898.

3. Information shall be deemed to be of a precise nature if:

a) it refers to a set of circumstances which exists or may reasonably be expected to come into existence or an event which has occurred or may reasonably be expected to occur; and

b) it is specific enough to enable a conclusion to be drawn as to the possible effect of the set of circumstances or event referred to in paragraph a) on the prices of financial instruments.

4. Information which, if made public, would be likely to have a significant effect on the prices of financial instruments shall mean information a reasonable investor would be likely to use as part of the basis of his investment decisions.

5. For persons charged with the execution of orders concerning financial instruments, inside information shall also mean information conveyed by a client and related to the client’s pending orders, which is of a precise nature, which relates directly or indirectly to one or more issuers of financial instruments or to one or more financial instruments and which, if made public, would be likely to have a significant effect on the prices of those financial instruments.899

Article 182
Scope

1. The crimes and the offences referred to in this title shall be punished according to Italian law even if committed abroad where they concern financial instruments admitted, or for which an application has been made for admission, to trading on an Italian regulated market or Italian multilateral trading system900.

2. Without prejudice to subsection 1, Articles 184, 185, 187-bis and 187-ter shall apply to acts involving financial instruments admitted, or for which an application has been made for admission, to trading on an Italian regulated market or on a regulated market of other EU countries.901

2-bis. Unless otherwise indicated under subsection 1, the provisions of Articles 184, 185, 187-bis and 187-ter shall apply to matters concerning financial instruments pursuant to Article 180, subsection 1, paragraph a), point 2)902.

Article 183
Exemptions

1. This title shall not apply:

a) to transactions relating to monetary, exchange-rate or public debt management policy concluded by the Italian state, another EU Member State, the European System of Central Banks, a central bank of an EU Member State or any other officially designated body or any person acting on their behalf;

b) to trading of own shares pursuant to Article 180, subsection 1, paragraph a) implemented as part of a buy-back programme of the issuer, subsidiary or affiliate, and as transactions to stabilise financial instruments pursuant to Article 180, subsection 1, paragraph a) that meet the conditions established by Consob regulation903.

Chapter II
Penal sanctions904

Article 184
Insider trading

1. Imprisonment for between one and six years and a fine of between twenty thousand and three million euro shall be imposed on any person who, possessing inside information by virtue of his membership of the administrative, management or supervisory bodies of an issuer, his holding in the capital of an issuer or the exercise of his employment, profession, duties, including public duties, or position:

a) buys, sells or carries out other transactions involving, directly or indirectly, for his own account or for the account of a third party, financial instruments using such information;

b) discloses such information to others outside the normal exercise of his employment, profession, duties or position;

c) recommends or induces others, on the basis of such information, to carry out any of the transactions referred to in paragraph a)

2. The punishment referred to in subsection 1 shall apply to any person who, possessing inside information by virtue of the preparation or execution of criminal activities, carries out any of the actions referred to in subsection 1.

3. Courts may increase the fine up to three times or up to the larger amount of ten times the product of the crime or the profit therefrom when, in view of the particular seriousness of the offence, the personal situation of the guilty party or the magnitude of the product of the crime or the profit therefrom, the fine appears inadequate even if the maximum is applied.

3-bis. With regard to financial instrument transactions pursuant to Article 180, subsection 1, paragraph a), point 2), the judicial sanction shall involve infliction of a fine of up to one hundred and three thousand two hundred and ninety-one euro and up to three-years’ imprisonment905.

4. For the purposes of this article, financial instruments shall also mean financial instruments referred to in Article 1(2) whose value depends on a financial instrument referred to in Article 180(1)(a).906

Article 185
Market manipulation

1. Imprisonment for between one and six years and a fine of between twenty thousand and three million euro shall be imposed on any person who disseminates false information or sets up sham transactions or employs other devices concretely likely to produce a significant alteration in the price of financial instruments.

2. Courts may increase the fine up to three times or up to the larger amount of ten times the product of the crime or the profit therefrom when, in view of the particular seriousness of the offence, the personal situation of the guilty party or the magnitude of the product of the crime or the profit therefrom, the fine appears inadequate even if the maximum is applied.

2-bis. With regard to financial instrument transactions pursuant to Article 180, subsection 1, paragraph a), point 2), the judicial sanction shall involve infliction of a fine of up to one hundred and three thousand two hundred and ninety-one euro and up to three-years’ imprisonment907.

Article 186
Accessory penalties

1. Conviction for any of the offences referred to in this chapter shall entail the application of the accessory penalties referred to in Articles 28, 30, 32-bis and 32-ter of the Penal Code for a period of not less than six months and not more than two years and the publication of the judgement in at least two daily newspapers having national circulation of which one shall be a financial newspaper.908

Article 187
Confiscation

1. In the event of conviction for one of the crimes referred to in this chapter the product of the crime or the profit therefrom and the property used to commit it shall be confiscated.

2. If it is not possible to execute the confiscation pursuant to subsection 1, a sum of money or property of equivalent value may be confiscated.

3. For matters not provided for in subsections 1 and 2, Article 240 of the Penal Code shall apply.909

Chapter III
Administrative sanctions

Article 187-bis 910
Insider trading

1. Without prejudice to the penal sanctions applicable when the action constitutes a criminal offence, a pecuniary administrative sanction of between twenty thousand euro and three million euro911 shall be imposed on any person who, possessing inside information by virtue of his membership of the administrative, management or supervisory bodies of an issuer, his holding in the capital of an issuer or the exercise of his employment, profession, duties, including public duties, or position:

a) buys, sells or carries out other transactions involving, directly or indirectly, for his own account or for the account of a third party, financial instruments using such information;

b) discloses such information to others outside the normal exercise of his employment, profession, duties or position;

c) recommends or induces others, on the basis of such information, to carry out any of the transactions referred to in paragraph a)

2. The sanction referred to in subsection 1 shall apply to any person who, possessing inside information by virtue of the preparation or execution of criminal activities, carries out any of the actions referred to in subsection 1.

3. For the purposes of this article, financial instruments shall also mean financial instruments referred to in Article 1(2) whose value depends on a financial instrument referred to in Article 180(1)(a).

4. The sanction referred to in subsection 1 shall also apply to any person who, possessing inside information and knowing or capable of knowing through ordinary diligence its inside nature, carries out any of the actions referred to therein.

5. Pecuniary administrative sanctions referred to in subsections 1, 2 and 4 shall be increased up to three times or up to the larger amount of ten times the product of the offence or the profit therefrom when, in view of the personal situation of the guilty party or the magnitude of the product of the offence or the profit therefrom, they appear inadequate even if the maximum is applied.

6. For the cases referred to in this article, attempted violations shall be treated as completed violations.

Article 187-ter 912
Market manipulation

1. Without prejudice to the penal sanctions applicable when the action constitutes a criminal offence, a pecuniary administrative sanction of between twenty thousand euro and five million euro913 shall be imposed on any person who, through the media, including the Internet, or by any other means, disseminates information, rumours or false or misleading news that give or are likely to give false or misleading signals as to financial instruments.

2. In respect of journalists when they act in their professional capacity the dissemination of information is to be assessed taking into account the rules of conduct governing their profession, unless they derive, directly or indirectly, an advantage or profits from the dissemination of the information in question.

3. Without prejudice to the penal sanctions applicable when the action constitutes a criminal offence, the pecuniary administrative sanction referred to in subsection 1 shall be imposed on any person who:

a) carries out buy or sell transactions or places orders to buy or sell which give, or are likely to give, false or misleading signals as to the supply of, demand for or price of financial instruments;

b) carries out buy or sell transactions or places orders to buy or sell which secure, by a person or persons acting in collaboration, the price of one or several financial instruments at an abnormal or artificial level;

c) carries out buy or sell transactions or places orders to buy or sell which employ fictitious devices or any other form of deception or contrivance;

d) employs other fictitious devices likely to give false or misleading signals as to the supply of, demand for or price of financial instruments.

4. For offences referred to in subsections 3a) and 3b), administrative sanctions may not be imposed on persons who demonstrate that they acted for legitimate reasons and in accordance with accepted market practices on the market concerned.

5. Pecuniary administrative sanctions referred to in the preceding subsections shall be increased up to three times or up to the larger amount of ten times the product of the offence or the profit therefrom when, in view of the personal situation of the guilty party, the magnitude of the product of the offence or the profit therefrom or the effects produced on the market, they appear inadequate even if the maximum amount is applied.

6. The Ministry of the Economy and Finance, after consulting Consob or acting on a proposal therefrom, shall specify, in a regulation conforming with the implementing measures of Directive 2003/6/EC adopted by the Commission using the procedure referred to in Article 17(2) of the same directive, the cases, possibly in addition to those referred to in the preceding subsections, relevant for purposes of applying this article.

7. Consob shall make known, in measures it adopts, the elements and circumstances to be taken into consideration in assessing behaviour likely to constitute market manipulation according to Directive 2003/6/EC and the implementing measures thereof914.

Article 187-quater
Accessory administrative sanctions

1. Application of pecuniary administrative sanctions referred to in this chapter shall imply the temporary non-fulfilment of the integrity requirements for corporate officers and shareholders of authorised intermediaries, stock exchange companies, auditors and financial advisors authorised to make off-premises offers and, for corporate officers of listed companies, temporary disqualification from taking up administrative, management or supervisory positions in listed companies or companies belonging to the same group as listed companies.915

2. Accessory administrative sanctions referred to in subsection 1 shall have a duration of not less than two months and not more than three years.

3. In the measure imposing pecuniary administrative sanctions referred to in this chapter, Consob, taking into account the seriousness of the violation and the degree of fault, may order authorised intermediaries, stock exchange companies, listed issuers and auditing firms not to use the offender in the exercise of their activities for a period of not more than three years and ask the competent professional associations to suspend the registrant from practice of the profession.916

Article 187-quinquies
Liability of the entity

1. Entities shall be liable for payment of a sum equal to the amount of the administrative sanction imposed for offences referred to in this chapter committed in their interest or to their advantage:

a) by persons performing representative, administrative or management functions in the entity or one of its organisational units having financial and functional autonomy and by persons who, de facto or otherwise, manage and control the entity.

b) persons subject to the direction or supervision of a person referred to in paragraph a).

2. If, following the perpetration of offences referred to in subsection 1, the product thereof or the profit therefrom accruing to the entity is very large, the sanction shall be increased up to ten times such product or profit.

3. Entities shall not be liable if they demonstrate that the persons specified in subsection 1 acted exclusively in their own interest or in the interest of third parties.

4. Articles 6, 7, 8 and 12 of Legislative Decree 231/2001 shall apply, insofar as they are compatible, to offences referred to in subsection 1. The Ministry of Justice, after consulting Consob, shall formulate the observations referred to in Article 6 of Legislative Decree 231/2001 with regard to offences referred to in this chapter.917

Article 187-sexies
Confiscation

1. The imposition of pecuniary administrative sanctions referred to in this chapter shall always entail the confiscation of the product of the offence or the profit therefrom and the property used to commit it.

2. If it is not possible to execute the confiscation pursuant to subsection 1, a sum of money or property of equivalent value may be confiscated.

3. In no case may property not belonging to one of the persons on whom the pecuniary administrative sanction was imposed be confiscated.918

Article 187-septies 919
Sanction procedures

1. The administrative sanctions provided for in this chapter shall be imposed by Consob with a reasoned order, after charging the interested parties within one hundred and eighty days or within three hundred sixty days from the ascertainment where the interested party resides or has its head office abroad. Interested parties may, within thirty days of the dispute, make submissions and request a personal hearing during the investigation stage, in which they may also participate with the assistance of a lawyer920.

2. The proceedings shall afford all parties the opportunity to state their case and have access to the investigation file. Transcripts shall be taken of the proceedings. Investigatory and adjudicatory functions shall be separate.

3. …omissis…921

4. An appeal can be brought against the provision that applies the sanction before the court of appeal under whose jurisdiction the appellant party's headquarters or residence fall. If the appellant party does not have its registered office or residence in the State, the court of appeal of the place where the violation occurred shall have jurisdiction. When these criteria do not apply, the court of appeal of Rome shall have jurisdiction. The appeal shall be notified, under penalty of forfeiture, to the Authority that issued the provision within thirty days of notification of the contested measure, or sixty days if the applicant resides abroad, and is filed with the clerk of the court, together with the documents by the deadline of thirty days from notification922.

5. Opposition does not suspend enforcement of the provision. If serious grounds occur, the court of appeal may order suspension with unchallengeable order 923.

6. The President of the Court of Appeal shall designate the Judge-Rapporteur and fix, by decree, the public hearing to discuss the appeal. The decree shall be notified to the parties by the clerk of court at least sixty days before the hearing. The Authority shall file memorandums and documents within ten days before the hearing. If the appellant does not appear at the first hearing without presenting any legitimate excuse, the judge shall declare, with an order subject to appeal to the Court of Cassation, that the appeal cannot go forward and charging the appellant for the expenses of the procedure924

6-bis. At the hearing the Court of Appeal shall have, even on its own motion, the evidence it deems necessary, as well as the personal hearing of the parties who have so requested. Then the parties shall proceed to an oral discussion of the case. The judgement is filed with the clerk of court within sixty days. When at least one of the parties would be interested in the advance publication of the order with respect to the judgement, the order is published by filing with the clerk of court no later than seven days from the discussion hearing925.

6-ter. With the decision, the court of appeal can dismiss the appeal, charging the appellant all the expenses of the procedure, or sustain it, annulling the order entirely or in part, or reducing the amount or term of the sanction926.

7. A copy of the judgement shall be forwarded, by the clerk of the court of appeal, to the Authority that issued the provision, also for the purposes of publication provided for in Article 195-bis927.

8. Article 16 of Italian Law no. 689 of 24 November 1981 does not apply to the pecuniary administrative sanctions envisaged by this chapter928.

Chapter IV
Consob’s powers

Article 187-octies
Consob’s powers

1. Consob shall oversee compliance with the provisions of this title as well as all other provisions issued in implementing Directive 2003/6/EC.

2. Consob shall investigate violations of the provisions of this title, utilizing the powers granted to it by this decree.

3. Consob may in relation to any person who could be acquainted with the facts:

a) require information, data or documents in any form whatsoever, establishing the time limits for receipt thereof;

b) require existing telephone records, establishing the time limits for receipt thereof;

c) conduct personal hearings;

d) seize property that may be confiscated under Article 187-sexies929;

e) carry out inspections;

f) conduct searches in the manner provided for in Article 33 of Presidential Decree 600/1973 and Article 52 of Presidential Decree 633/1972.

4. Consob may further:

a) avail itself of the cooperation of governmental bodies, requiring that it be provided with data and information – notwithstanding where relevant the restrictions laid down in Article 25(1), of Legislative Decree 196/2003 – and access the information system of the tax records database in the manner provided for in Articles 2 and 3(1) of Legislative Decree 212/1991;

b) require the provider to furnish it with the traffic records referred to in Legislative Decree 196/2003;

c) require the communication of personal data, notwithstanding where relevant the restrictions laid down in Article 25(1) of Legislative Decree 196/2003;

d) avail, where necessary, of the information contained in the register of accounts and deposits referred to in Article 20(4) of Law 413/1991 in accordance with the procedures set forth in Article 3(4)(b) of Decree Law no. 143 of 3 May 1991 ratified with amendments by Law 197/1991 as well as gain access, directly or otherwise, to the information contained in the register referred to in Article 13 of Decree Law 625/1979 ratified with amendments by Law 15/1980;

e) gain direct access, through a dedicated electronic connection, to the data contained in the Bank of Italy's Central Credit Register referred to in the resolution of the Interministerial Committee for Credit and Savings of 29 March 1994, published in Official Gazette no. 91 of 20 April 1994930.

e-bis) make use where necessary, also through an electronic connection, of data contained in the special section of the tax records system pursuant to Article 7, subsection 6, Presidential Decree no. 605 of 29 September 1973931;

5. The powers under subsections 3(d), 3(f) and 4(b) shall be exercised subject to authorisation by the Chief Public Prosecutor's Office. Such authorisation is also necessary for the exercise of the powers under subsections 3(b), 3(e), and 4(c) against persons other than authorised intermediaries, the persons specified in Articles 114(1), 114(2) and 114(8) and other persons subject to supervision pursuant to this decree.

6. Where there are grounds for suspecting that the provisions of this title are being violated, Consob may as a precautionary measure direct that the relevant conduct cease.

7. The provisions hereof are without prejudice to the application of Articles 199, 200, 201, 202 and 203 of the Criminal Procedure Code insofar as they are compatible.

8. In the cases provided for in subsections 3(c), 3(d), 3(e), 3(f) and 12, a procès-verbaux shall be drawn up noting the data and information obtained or the findings of fact made, the seizures carried out and the statements given by the interested persons, who shall be requested to sign the procès-verbaux and shall be entitled to a copy thereof.

9. In the event of a seizure under subsection 3(d), the interested persons may file opposition with Consob.

10. The decision on the opposition shall be adopted with a measure stating the grounds therefore issued within 30 days from the date of filing of the opposition proceedings in question.

11. The seized property shall be returned to those so entitled when:

a) the person who committed the violation dies;

b) it is proved that those so entitled are third parties extraneous to the offence;

c) the notice of the charges is not served within the time limit laid down by Article 14 of Law 689/1981;

d) the pecuniary administrative sanction has not been imposed within the time limit of two years from the finding of the violation.

12. In the exercise of its powers under subsections 2, 3 and 4, Consob may avail itself of the cooperation of the Finance Police which shall carry out the requested inquiries relying on the investigatory powers that they enjoy in connection with the assessment of VAT and income taxes.

13. All of the information and data obtained by the Finance Police further to action taken under subsection 12 shall be covered by professional secrecy and be communicated without delay exclusively to Consob.

14. Consob's measures imposing pecuniary sanctions shall be enforceable. Failing payment within the time limit fixed therefore, Consob shall levy execution of the sum due in accordance with the rules governing the collection of sums owing to the State, local authorities, governmental bodies and social security bodies.

15. When the offender pursues a profession, the measure imposing the sanction shall be transmitted to the competent professional association.932

Article 187-nonies
Suspicious transactions

1. Authorised intermediaries, stockbrokers entered in the single national roll and stock exchange companies must notify Consob without delay of transactions that, on reasonable grounds, appear to involve a violation of the provisions of this title. Consob shall lay down in a regulation the categories of persons subject to this obligation, the elements and circumstances to be taken into consideration in assessing behaviour likely to constitute a suspicious transaction, and the procedures and time limits for such notifications.933

Chapter V
Relationship between proceedings

Article 187-decies
Relations with the judicial authorities

1. Upon receiving notice of the commission of a crime under Chapter II, the public prosecutor shall without delay inform the Chairman of Consob thereof.

2. The Chairman of Consob shall forward the public prosecutor the documentation gathered during its own inquiries accompanied by a reasoned report in cases where there are grounds for suspecting that a crime may have been committed. The documents shall be forwarded to the public prosecutor at the very latest within the time limit for investigating violations of Chapter III of this title.

3. Consob and the judicial authorities shall cooperate with each other, including through the exchange of information, in order to facilitate the investigation of violations of this title, including in cases where such do not constitute crimes. To this end Consob may utilize the documents, data and information obtained by the Finance Police in the manner and form established in the first subsection of Article 63 of Presidential Decree 633/1972 and the third subsection of Article 33 of Presidential Decree 600/1973.934

Article 187-undecies
Consob’s powers in criminal proceedings

1. In proceedings for crimes under Articles 184 and 185, Consob may exercise the rights and powers granted by the Criminal Procedure Code to the bodies and associations representing the interests injured by the crime.

2. Consob may also intervene as a civil claimant and request, by way of compensation for the loss occasioned to the integrity of the market by the crime, damages in an amount to be assessed by the court, including equitably, taking account of the seriousness of the crime, the personal situation of the guilty party or the amount of the proceeds of the crime or the profit therefrom.935

Article 187-duodecies
Relationship between criminal proceedings and administrative and appeal proceedings

1. The administrative and appeal proceedings referred to in Article 187-septies may not be suspended on the grounds that criminal proceedings are pending covering the same facts or facts on which the definition of the case depends.936

Article 187-terdecies
Collection of fines and pecuniary sanctions in criminal proceedings

1. When a pecuniary administrative sanction pursuant to Article 187-septies937 has been imposed on the offender or the entity for the same facts, the collection of the pecuniary penalty and the pecuniary administrative sanction deriving from the crime shall be limited to the portion thereof exceeding what the administrative authority has collected.938

Article 187-quaterdecies
Consultation procedures

1. Within 12 months of the date of entry into force of this subsection Consob shall lay down in a regulation the methods and time limits for the consultation procedures to be engaged in – through the setting up of a committee with members representing consumers, providers of financial service and other supervised persons – when regulatory changes are being made in the field of market abuse and in the other areas falling within Consob's institutional remit.939

TITLE II
ADMINISTRATIVE SANCTIONS940

Article 187-quinquiesdecies 941
Safeguarding of supervisory functions of the Bank of Italy and of the Consob 942

1. Apart from the cases provided for in Article 2638 of the Civil Code, any person who fails to comply with a request from the Bank of Italy and Consob within the prescribed time limits or delays the performance of their functions shall be punished by a pecuniary administrative sanction of between ten thousand euro and two hundred thousand euro943 / 944.

Article 188 945
Unauthorised use of names

1. The use, in the name or in any distinctive mark or communication addressed to the public, of the words: "SIM" or "securities trading company" or "investment firm"; "SGR" or "asset management company"; "SICAV" or "investment company with variable share capital"; "SICAF" or "fixed capital investment company"; "EuVECA" or "European fund for venture capital"; "EuSEF" or "European Social Entrepreneurship Fund"; or other words or terms, also in a foreign language, that can be misleading in respect of the legitimacy to perform investment services or activities or the collective asset management service is forbidden to subjects other than investment companies, asset management companies, SICAVs, SICAFs, subjects authorised pursuant to regulations (EU) no. 345/2013, relative to European Venture Capital Funds (EuVECA), and no. 346/2013, relative to European Social Entrepreneurship Funds (EuSEF). Anyone who breaches the prohibition contemplated by this article shall be fined from five thousand to five million euros. If the violation is committed by a company or an entity, an administrative fine is applied from thirty thousand euros up to ten per cent of turnover946.

2. The administrative fine provided for in this article shall not be subject to Articles 6, 10, 11 and 16 of Law no. 689 of 24 November 1981947.

2-bis. If the benefit obtained by the infringer as a result of the violation itself is above the maximum limits set out in this article, the administrative fine is increased up to twice the amount of the benefit obtained, provided that this amount can be determined948.

Article 189 949
Holdings of capital

1. Omission of the notifications provided for in Articles 15, subsections 1 and 3, 61, subsection 6, and 80, subsection 7, and those required pursuant to Article 17 is punishable by an administrative fine of from five thousand to five million euros. If the violation is committed by a company or an entity, an administrative fine is applied from thirty thousand euros up to ten per cent of turnover950.

2. The same sanction shall apply in the event of violation of the prohibitions on voting and in the event of non-compliance with the obligation to dispose of holdings referred to in Articles 14(4), 14(7), 16(1), 16(2), 16(4), 61(7) and 80(8).951

2-bis. Article 188, subsections 2 and 2-bis apply952.

Article 190 953
Other financial penalties regarding intermediaries, markets and the central depository system for financial instruments 954

1. To qualified subjects, trustees and subjects to which essential or important operating functions have been outsourced, an administrative sanction is applied from thirty thousand euros up to ten per cent of turnover, for failure to comply with Articles 6, 7, subsections 2, 2-bis and 3, 8, subsections 1 and 1-ter; 9, 10, 12, 13, subsection 3, 21, 22, 24, subsection 1, 25, 25-bis, subsections 1 and 2, 27, subsection 3 and 4, 28, subsection 3, 30, subsections 3, 4 and 5, 31, subsections 1, 2, 5, 6 and 7, 32, subsection 2, 33, subsection 4, 35-bis, subsection 6, 35-novies, 35-decies, 36, subsections 2, 3 and 4, 37, subsections 1, 2 and 3, 39, 40, subsections 2, 4 and 5, 40-bis, subsection 4, 40-ter, subsection 4, 41, subsections 2, 3 and 4, 41-bis; 41-ter, 41-quater; 42, subsections 1, 3 and 4, 43, subsections 2, 3, 4, 7, 8 and 9, 44, subsections 1, 2, 3 and 5, 45, 46, subsections 1, 3 and 4, 47, 48, 49, subsections 3 and 4, 55-ter, 55-quater, 55-quinquies, 65, 79-bis, 187-novies, i.e., the general or specific rules issued by the Bank of Italy or Consob based on the same articles. The same sanction shall be applied to companies or entities in the event of non-compliance with Article 18, subsection 2, and Article 32-quater, subsections 1 and 3, or in case of the exercise of portal operator activities without enrolment in the registry referred to in Article 50-quinquies955.

1-bis. …omissis…956

2. The same sanction provided for in subsection 1 shall apply:

a) to management companies of the market, in the case of non-compliance with the provisions of Chapter I of Title I of Part III and those issued pursuant thereto;

b) to centralised depositories, in the case of non-compliance with the provisions of Title II of Part III and those issued pursuant thereto;

c) to the intermediaries specified in Article 79-quater for non-compliance with the provisions of Article 83-novies, subsection 1, letters c), d), e) and f), 83-duodecies, and of those issued pursuant thereto;

d) to organizers and operators of interbank fund trading systems, subjects that manage multilateral trading systems and systematic internalisers, in the case of non-compliance with the provisions of Chapters II and II-bis of Title I of Part III and those issued pursuant thereto;

e) to the operators of the systems listed in Articles 68 and 69, subsection 2, to the company referred to in Article 69, subsection 1, in the event of non-compliance with Articles 68, 69, 70-bis and 77, subsection 1, and the related implementing provisions;

f) to insurance companies, in the event of non-compliance with Article 25-bis, subsections 1 and 2, and those issued pursuant thereto;

g) to operators admitted to trading on regulated markets in the event of non-compliance with the provisions of Article 25, subsection 3;

h) to issuers of shares in the event of non-compliance with the provisions of Article 83-undecies, subsection 1957.

2-bis. The same sanction provided for in subsection 1 shall apply:

a) managers of European Venture Capital Funds (EuVECA), in case of violation of the provisions of Articles 2, 5, 6, 7, 8, 9, 10, 11, 12 and 13 of Regulation (EU) no. 345/2013 and its implementing provisions;

b) to managers of European Social Entrepreneurship Funds (EuSEF), in the case of violation of the provisions of Articles 2, 5, 6, 7, 8, 9, 10, 11, 12, 13 and 14 of Regulation (EU) no. 346/2013 and of the relative enactment provisions958.

2-ter. The pecuniary administrative sanction is applied from two thousand, five hundred euro to one hundred and fifty thousand euro:

a) with regards to stock brokerage companies, Community investment companies with a branch in Italy, non-European Community investment companies registered on the list envisaged by Article 106 of the Consolidated Law on Banking, Italian banks, European Community banks with branch in Italy and non-European Community banks that are authorised to provide investment business or services and with regards to subjects carrying out administrative or managerial functions of central counterparties, in the event of the breach of the provisions laid down by Articles 4, paragraph 1, subsection 1 and 5-bis of Regulation (EC) No 1060/2009 of the European Parliament and Council, of 16 September 2009 and the related implementing provisions;

b) with regards to the managers in the event of breach of Article 35-duodecies and Article 4, paragraph 1, subsection 1 of the regulation pursuant to letter a), and the related implementing provisions959.

3. Article 188, subsection 2-bis shall apply960.

3-bis. …omissis…961.

4. Except as provided for in Article 194-quinquies, the administrative fines provided for in this article shall not be subject to Articles 6, 10, 11 and 16 of Law no. 689 of 24 November 1981962.

Article 190-bis
Liability of company representatives and staff for violations relating to the regulation of intermediaries, markets and the centralised management of financial instruments

1. Notwithstanding the provisions for companies and entities against which violations are proven, for non-compliance with the provisions referred to in Articles 188, 189 and 190, an administrative fine shall be applied from five thousand up to five million euros against persons who perform administrative, management or control functions, as well as against staff, where the non-compliance is a result of the violation of their duties or of the body they are members of and there are one or more of the following conditions:

a) the conduct had a significant impact on the overall organization or company risk profiles of business, or has caused serious harm to the protection of investors or to the integrity and proper functioning of the market;

b) the conduct contributed to the failure of the company or entity to comply with specific measures adopted pursuant to Article 7, subsection 2, and 12, subsection 5-bis;

c) the violations concern obligations imposed under Article 6, subsections 2-septies, 2-octies, 2-novies, or Article 13, i.e., obligations regarding remuneration and incentives, when the representative or the staff is the interested party.

2. Against persons who perform administrative, management or control functions, as well as staff, in cases where their conduct contributed to the failure to comply with the order referred to in Article 194-quater by the company or body, a fine shall be imposed from five thousand up to five million euros.

3. With the order to apply the sanction, by reason of the severity of the violation found and taking into account the criteria of Article 194-bis, the Bank of Italy and Consob may apply the accessory sanction of the interdiction, for a period not less than six months and not more than three years, from the performance of administrative, management and control functions at authorized intermediaries pursuant to this legislative decree, Legislative Decree no. 385 of 1 September 1993 and Legislative Decree no. 209 of 7 September 2005, or at pension funds.

4. Article 188, subsections 2 and 2-bis apply963.

Article 190-ter 964
Other violations regarding reserved activities

1. An administrative fine sanction is applied from five thousand up to five million euros:

a) in case of the exercise of the activity of pursuit of financial planner965 or financial advisor966 in the absence of enrolment in the registers required, respectively, in Articles 18-bis and 31;

b) …omissis…967

c) …omissis…968

d) to individuals, in the event of non-compliance with Article 32-quater, subsections 1 and 3, or in case of the exercise of portal operator activities in the absence of enrolment in the register referred to in Article 50-quinquies.

2. Article 188, subsections 2 and 2-bis apply.

2-bis2-bis. On a Consob proposal, the Minister of Economy and Finance can dissolve the management and control bodies of the organisation referred to under Article 31 if serious irregularities in the administration, or serious breaches of the legislative, administrative or statutory provisions which discipline the activity of the same are found. The Ministry of Economy and Finance provides for the procedures necessary to reconstruct the management and control bodies of the organisation, ensuring operational continuity, if necessary also through the appointment of a commissioner. Consob may order the removal of one or more members of the management and control bodies in the case of serious default on the duties assigned to the same by law, by statute or by the supervisory provisions, and serious non-compliance with specific provisions and other instructions issued by Consob, or in the case of the proven inadequacy, ascertained by Consob, in the exercise of the functions for which they were appointed969.

Article 191 970
Public offerings

1. Anyone who makes an offer to the public in violation of Articles 94, subsection 1, and 98-ter, subsection 1, shall be punished with an administrative fine of from twenty-five thousand up to five million euros971.

2. Anyone who violates Articles 94, subsections 2, 3, 5, 6 and 7, 96, 97, 98-ter, subsections 2 and 3, 101, or the related general or specific rules issued by Consob pursuant to Articles 95, subsections 1, 2 and 4, 97, subsection 2, 98-quater, 98-quinquies, subsection 2, 99, subsection 1, letters a), b), c) and d), shall be punished with an administrative fine of from five thousand up to seven hundred fifty thousand euros972.

2-bis. If a company or entity is required to comply with the provisions of subsections 1 and 2, the sanctions provided for therein shall apply to these latter; the same penalty shall be applied to company representatives and staff of a company or entity in the cases provided for in Article 190-bis, subsection 1, letter a). If a natural person is required to comply with the same provisions, the sanction applies to the latter in case of violation973.

3. The application of the administrative fines envisaged by subsection 1 involves the temporary loss of the requirements of suitability established by this decree for company representatives of qualified subjects and of the requirements for financial advisors authorised to make off-premises offers as well as the temporary incapacity to hold administrative, managerial and control positions in companies with securities listed on regulated markets or diffused amongst the public in a significant manner and companies belonging to the same group. The accessory administrative sanction shall have a duration of no less than two months and no more than three years974.

3-bis. Except as provided for in Article 194-quinquies, the administrative fines provided for in this article shall not be subject to Articles 6, 10, 11 and 16 of Law no. 689 of 24 November 1981975.

4. …omissis…976

5. Article 16, Law no. 689 of 24 November 1981 shall not apply to the financial penalties envisaged under this article977.

Article 192 978
Takeover bids or exchange tender offerings

1. Any person violating the obligation to launch a takeover bid or exchange tender offering or launching a takeover bid or exchange tender offering in violation of article 102, subsections 1, 3 and 6, shall be punished by a financial penalty of not less than twenty-five thousand Euro and not exceeding the total amount payable by the bidder or which would have been payable by the bidder had the takeover bid or exchange tender offering been implemented979.

2. The sanction referred to in subsection 1 shall apply to persons who:

a) fail to comply with the indications given by Consob pursuant to Article 102, subsection 4, or violate the regulations issued pursuant to Article 102, subsection 1 and Article 103, subsection 4980;

a-bis) violates the provisions of article 103, subsections 3 and 3-bis981;

a-ter) violates provisions regarding mandatory takeover pursuant to article 108, subsections 1 and 2, and provisions of the regulation issued pursuant to article 108, subsection 7982;

b) exercises voting rights in violation of the provisions of article 110;

b-bis) violates the provisions of article 110, subsection 1-bis983;

2-bis. If a company or entity is required to comply with the provisions of subsections 1 and 2, the sanctions provided for therein shall apply to these latter; the same penalty shall be applied to company representatives and staff of a company or entity in the cases provided for in Article 190-bis, subsection 1, letter a). If an individual is required to comply with the same provisions, the sanction applies to the latter in case of violation. The maximum sanction applicable to an individual for the violations provided for in subsections 1 and 2 shall not exceed five million Euros984.

2-ter. Article 188, subsections 2 and 2-bis apply985.

3. …omissis…986.

Article 192-bis 987
Corporate governance disclosures 988

1. Unless the fact is a criminal offence, companies listed on regulated markets which do not make the disclosures prescribed by Article 123-bis, paragraph 2, letter a), will be subjected to the following measures and administrative sanctions:

a) a public statement indicating the legal person responsible for the breach and the nature of the same;

b) an order to eliminate the infringements charged, with possible indication of the measures to be adopted and of the term for compliance, and to refrain from repeating the offence, when the said infringements feature scarce offensiveness or danger;

c) a financial administrative sanction from Euro ten thousand to Euro ten million, or, if greater, up to five percent of the total annual sales989.

1-bis. For failing to provide for the disclosures indicated under paragraph 1, in the cases contemplated by Article 190-bis, paragraph 1, letter a), unless the fact is a criminal offence, subjects which perform functions of administration, management or control, and personnel, if their behaviour has contributed to determining the omission of the disclosures on the part of the company or entity, are punished by the following measures and administrative sanctions:

a) a public statement indicating the person responsible for the breach and the nature of the same;

b) an order to eliminate the infringements charged, with possible indication of the measures to be adopted and of the term for compliance, and to refrain from repeating the offence, when the said infringements feature scarce offensiveness or danger;

c) a financial administrative sanction from Euro ten thousand to Euro two million990.

1-ter. Article 188, subsections 2 and 2-bis991 apply.

1-quater. In the case of non-compliance with the order to eliminate the infringements charged and to refrain from repeating them, the financial administrative sanction contemplated for the breach originally charged, increased by up to one third, will be applied. Without prejudice to what is contemplated for legal persons which are ascertained as having failed to observe the order, the financial administrative sanction of between Euro ten thousand and Euro two million is imposed on subjects which perform functions of administration, direction or control, as well as on the personnel, if their behaviour has contributed to determining the non-observance of the order on the part of the legal person992.

Article 192-ter 993
Admission to trading

1. To an issuer or the person asking for admission to trading that violates the provisions of Articles 113, subsections 2 and 3, letters a), d), f) and 4, and 113-bis, subsections 1, 2, letters a) and b), and 4, or the general or specific rules issued by Consob pursuant thereto, an administrative fine shall be imposed from five thousand to seven hundred fifty thousand euros994.

2. …omissis…995

2-bis. The penalty provided for in subsection 1 shall also apply in respect of company representatives and staff of a company or entity in the cases provided for in Article 190-bis, subsection 1, letter a)996.

3. …omissis…997

3-bis. Article 188, subsections 2 and 2-bis apply998.

Article 192-quater
Obligation of abstention

1. Partners and directors who violate the obligation of abstention referred to in Article 6, subsection 2-novies, shall be punished by an administrative fine of from fifty thousand to one hundred fifty thousand euros999.

Article 193 1000
Corporate disclosures and the duties of auditors, statutory auditors and independent statutory auditors1001

1. Unless the fact is an offence against companies, entities or associations held to make the disclosures contemplated by Articles 114, 114-bis, 115, 154-bis, 154-ter and 154-quater, or subject to the obligations pursuant to Article 115-bis for non-compliance with the provisions of the said articles or the relative implementation provisions, the following measures and administrative sanctions are applied:

a) a public statement indicating the legal person responsible for the breach and the nature of the same;

b) an order to eliminate the infringements charged, with possible indication of the measures to be adopted and of the term for compliance, and to refrain from repeating the offence, when the said infringements feature scarce offensiveness or danger;

c) a financial administrative sanction from Euro five thousand to Euro ten million, or if greater up to five percent of the total annual sales 1002.

1.1. If the disclosures indicated in paragraph 1 are required of a natural person, unless the fact is a criminal offence, in the case of breach, unless a reason for exemption exists contemplated by Article 114, paragraph 10, the following measures and administrative sanctions are applied against the said person:

a) a public statement indicating the person responsible for the breach and the nature of the same;

b) an order to eliminate the infringements charged, with possible indication of the measures to be adopted and of the term for compliance, and to refrain from repeating the offence, when the said infringements feature scarce offensiveness or danger;

c) a financial administrative sanction from Euro five thousand to Euro two million1003.

1.2. For the breaches indicated under paragraph 1, the subjects who perform administrative, direction or control functions as well as the personnel, always if their behaviour has contributed to determining the said breach on the part of the legal person, are subjected, in the cases contemplated by Article 190-bis, paragraph 1, letter a), to the administrative sanctions contemplated by paragraph 1.11004.

1-bis. …omissis…1005

1-ter. …omissis…1006

1-quater. The same sanctions indicated under paragraphs 1, 1.1 and 1.2 are applied,, in cases of failure to observe the enactment provisions issued by Consob pursuant to article 113-ter, subsection 5, paragraphs b) and c), to persons authorised by Consob to provide disclosure and archiving services in relation to regulatory information1007..

1-quinquies. The pecuniary administrative sanction is applied from five thousand euro to one hundred and fifty thousand euro:

a) to the issuers, bidders or persons asking for admission to trading on Italian regulated markets, in the event of breach of Article 4, paragraph 1, subsection 2 of Regulation (EC) No 1060/2009 of the European Parliament and Council, of 16 September 2009, relative to the credit ratings agencies;

b) to issuers, transferors or promoters of structured finance instruments, in the event of breach of Article 8-ter of the regulation pursuant to letter a);

c) to issuers or related third parties as defined by Article 3, paragraph 1, letter i), of the regulation pursuant to letter a), in the event of violation of Articles 8-quater and 8-quinquies of said regulation1008.

2. Unless the fact is a criminal offence, in the case of failure to disclose major shareholdings and shareholders' agreements as envisaged respectively by Articles 120, paragraphs 2, 2-bis and 4, and 122, paragraphs 1, 2 and 5, and violation of the prohibitions established by Articles 120, paragraph 5, 121, paragraphs 1 and 3, and 122, paragraph 4, the following measures and administrative sanctions are imposed on companies, entities and associations:

a) a public statement indicating the subject responsible for the breach and the nature of the same;

b) an order to eliminate the infringements charged, with possible indication of the measures to be adopted and of the term for compliance, and to refrain from repeating the offence, when the said infringements feature scarce offensiveness or danger;

c) a financial administrative sanction from Euro ten thousand to Euro ten million, or if greater up to five percent of the total annual sales1009.

2.1. Unless the fact is a criminal offence, if the disclosures referred to under paragraph 2 are required of a natural person, in the case of breach the following measures and administrative sanctions are applied:

a) a public statement indicating the person responsible for the breach and the nature of the same;

b) an order to eliminate the infringements charged, with possible indication of the measures to be adopted and of the term for compliance, and to refrain from repeating the offence, when the said infringements feature scarce offensiveness or danger;

c) a financial administrative sanction from Euro ten thousand to Euro two million1010.

2.2. For the breaches indicated under paragraph 2, the subjects who perform administrative, direction or control functions as well as the personnel, always if their behaviour has contributed to determining the said breach on the part of the legal person, are subjected, in the cases contemplated by Article 190-bis, paragraph 1, letter a), to the administrative sanctions contemplated by paragraph 2.11011.

2.3. In the case of a delay in making the disclosures contemplated by Article 120, paragraphs 2, 2-bis and 4, of no more than two months, the minimum statutory amount of the financial administrative sanctions indicated in paragraphs 2 and 2.1 is Euro five thousand1012.

2.4. If the benefit obtained by the perpetrator of the breach as a result of the breach itself is above the maximum statutory limits set out in Articles 1, 1.1, 2 and 2.1, of this Article, the financial administrative sanction is increased up to twice the amount of the benefit obtained, provided that this amount can be determined1013.

2-bis. …omissis…1014.

3. A financial administrative sanction from Euro ten thousand to Euro one million five hundred thousand is applied1015:

a) members of boards of auditors, supervisory boards and management control committees who commit irregularities in performing the duties provided for in Articles 149(1), 149/(4-bis) and 149(4 ter) or omit the notifications referred to in Article 149(3);1016

b) ...omissis...1017.

3-bis. Unless the act constitutes a crime, members of internal control bodies who fail to make the communications referred to in Article 148(2-bis) within the prescribed time limits shall be punished by a pecuniary administrative sanction equal to twice the annual compensation provided for the position in relation to which the communication was omitted. The measure imposing the sanction shall also announce disqualification from the position.1018

3-ter. Except as provided in Article 194-quinquies, the administrative fines provided for in this article shall not be subject to Articles 6, 10, 11 and 16 of Law no. 689 of 24 November 19811019.

3-quater. Breach of the orders contemplated by this Article is punished pursuant to Article 192-bis, paragraph 1-quater1020.

Article 193-bis
Business dealings with foreign companies with their registered office
in a country that does not ensure corporate transparency

1. Persons who sign the annual accounts of foreign companies referred to in Article 165-quater(2), the reports and opinions referred to in Articles 165-quater(2), 165-quater(3), 165-quinquies(1) and 165-sexies(4) and those who perform audits pursuant to Article 165-quater(4) shall be subject to civil, penal and administrative liability in accordance with what is provided for in relation to the annual accounts of Italian companies.

2. Unless the act constitutes a crime, violation of the obligations deriving from the exercise of the powers assigned to Consob by Article 165-septies(1) shall be punished by the pecuniary administrative sanction provided for in Article 193(1).1021

Article 193-ter
Fines for breach of the prescriptions of regulation (EU) n° 236/2012

1. Anyone who does not comply with the provisions of articles 5, 6, 7, 8, 9, 15, 17, 18 and 19 of Regulation (EU) n° 236/2012 and relative implementation rules, shall be fined from twenty-five thousand euro to two million five hundred thousand euro.

2. The same sanction of subsection 1 is applicable to anyone who:

a) breaches the provisions of articles 12, 13 and 14 of the Regulation indicated in subsection 1 and relative implementation rules;

b) breaches the measures adopted by the competent authorities contemplated by article 4-ter pursuant to articles 20, 21 and 23 of the same Regulation.

3. The fines contemplated by subsection 2, letters a) and b), shall be increased up to the greater sum of either three times the amount or ten times the product or profit gained by the illicit fact when, for the personal qualities of the guilty subject, for the entity of the product or profit gained by the illicit fact or by the effects produced on the market, the maximum sum seems inadequate.

4. The application of the fines contemplated by this article always entails the confiscation of the product or profit gained by the illicit fact. If confiscation is not possible, sums of money, assets or other benefits of equivalent value shall be confiscated.

5. The fines contemplated by this article are not subject to article 16 of Italian Law n° 689 of 24 November 19811022

Article 193-quater 1023
Fines relative to breach of the provisions issued by Regulation (EU) no. 648/2012 of the European Parliament and of the Council, of 4 July 2012

1. Central counterparties, trading venues, financial counterparties and non-financial counterparties, as defined in Article 2, points 1), 4), 8) and 9) of Regulation (EU) no. 648/2012 of the European Parliament and of the Council of 4 July 2012, that do not comply with the provisions laid down in Titles II, III, IV and V of that Regulation and its related implementing provisions shall be punished with an administrative fine of from five thousand up to five million euros, if individuals, and from thirty thousand euros up to ten per cent of turnover, if legal persons1024.

2. …omissis…1025

3. The administrative sanctions provided for in subsection 1 are applied by Bank of Italy, Consob, IVASS and COVIP according to the respective powers of supervision1026.

4. The fines contemplated by this article are not subject to article 16 of Law n° 689 of 24 November 1981.

Article 194 1027
Proxies

1. ...omissis...1028

2. A subject that promotes a solicitation of voting proxies that violates the rules of Articles 138, 142, subsections 1 and 2, 144, subsection 4, and the regulation issued pursuant to Article 144, subsection 1, shall be punished with an administrative fine of from five thousand up to seven hundred fifty thousand euros1029.

2-bis. The sanction envisaged in subsection 2 shall apply to an appointed representative of a listed company acting in violation of Article 135-undecies, subsection 41030.

2-ter. If a company or entity is required to comply with the provisions of subsection 2, the sanctions provided for therein shall apply to these latter; the same penalty shall be applied to company representatives and staff of a company or entity in the cases provided for in Article 190-bis, subsection 1, letter a). If a natural person is required to comply with the same provisions, the sanction applies to the latter in case of violation1031.

2-quater. Except as provided for in Article 194-quinquies, the administrative fines provided for in this article shall not be subject to Articles 6, 10, 11 and 16 of Law no. 689 of 24 November 19811032.

Article 194-bis 1033
Criteria for determining sanctions

1. In determining of the type and the amount of the administrative fines or the duration of the accessory sanctions provided for in this decree, the Bank of Italy or Consob shall consider all relevant circumstances and, in particular, taking into account whether the recipient of the sanction is an individual or legal person, the following, where relevant:

a) severity and duration of the violation;

b) degree of responsibility;

c) financial capacity of the person responsible for the violation;

d) amount of the benefit gained or losses avoided through the violation, insofar as it can be determined;

e) damages caused to third parties through the violation, to the extent that their amount can be determined;

f) level of cooperation of the person responsible of the violation with the Bank of Italy or Consob;

g) previous banking or financial violations committed by the same subject;

h) potential systemic consequences of the violation1034.

Article 194-ter
Sanctions for violations of directly applicable provisions of the European Union

1. In the matters referred to in the provisions cited in Articles 189, 190 and 190-bis, the sanctions provided for therein apply, in the measure, according to the allocation of competences and in the manner laid down, also in the case of non-compliance with EU Regulation no. 575/2013, the related regulatory technical and implementing rules issued by the European Commission under Articles 10 and 15 of EU Regulation no. 1093/2010, or in the event of non-compliance with the acts of the ESMA or EBA directly applicable to supervised entities adopted pursuant to this last Regulation or EU regulation no. 1095/20101035.

Article 194-quater 1036
Order to put an end to violations

1. The Bank of Italy or Consob, within their respective competences, for violations of the rules laid down in Articles 6, 12, 21, subsections 1 and 1-bis, 33, subsection 4, 35-decies, 79-bis, 115-bis and its related implementing provisions, when they are connoted by scarce offensiveness or danger, as an alternative to the application of administrative fines, sanctions can be imposed on companies or entities consisting of an order to eliminate the alleged infringements, also indicating the measures to be taken and the deadline for performance1037.

2. For failure to comply with the order by the specified deadline, the Bank of Italy or Consob, according to their respective competences, shall apply the administrative fine originally challenged increased by up to a third.

Article 194-quinquies 1038
Payment of a reduced amount

1. It is possible to settle, by payment, within thirty days of notification of the dispute letter, of a sum equal to twice the minimum penalty prescribed by law, when there are none of the circumstances provided for in subsection 2, the following violations as provided by:

a) Article 190, for the violation of Articles 45, subsection 1, 46, subsection 1, 65, 83-novies, subsection 1, letters c), d), e) and f), 83-duodecies and the related implementing provisions adopted by Consob;

b) Article 191, subsection 2, for the violation of Articles 96 and 101, subsections 1, 2 and 3;

c) Article 193, paragraphs 1, 1.1 and 1.2, for the violation of Articles 113-ter, subsection 5, letter b), 114, subsections 2 and 7, and Article 193 paragraphs 2, 2.1, 2.2 and 2.3, subsection 2, for a violation of Article 1201039;

d) Article 194, subsection 2, for the violation of Article 142 and Article 194, subsection 2-bis.

2. The reduced payment cannot be made if the person concerned has already benefited from this measure in the twelve months prior to the alleged violation.

Article 194-sexies
Harmless conduct

1. In cases provided for in Article 194-quinquies, Consob shall not dispute violations in cases of absolute lack of damage to investor protection and transparency of the market for corporate control and the capital market, or for the timely exercise of supervisory functions1040.

Article 195 1041
Sanction procedures

1. The administrative sanctions provided for in this Title shall be applied by the Bank of Italy or Consob, within their respective competences, with a reasoned order, after charging the interested parties, to be carried out within one hundred and eighty days from the ascertainment, or within three hundred sixty days, where the interested party resides or has its head office abroad. Interested parties may, within thirty days of the dispute, make submissions and request a personal hearing during the investigation stage, in which they may also participate with the assistance of a lawyer1042.

2. The proceedings shall afford all parties the opportunity to state their case and have access to the investigation file. Transcripts shall be taken of the proceedings. Investigatory and adjudicatory functions shall be separate.

3. …omissis…1043.

4. Opposition may be brought against the provision for the application of sanctions before the court of appeal of the place in which the company or entity to which the perpetrator of the violation belongs is located or, if these criteria do not apply, the place in which the violation was committed. The appeal shall be notified, under penalty of forfeiture, to the Authority that issued the provision within thirty days of notification of the contested measure, or sixty days if the applicant resides abroad, and is filed with the clerk of the court, together with the documents by the deadline of thirty days from notification1044.

5. The appeal shall not stay enforcement of the decision. The court of Appeal, if there are serious reasons, may order suspension with an unchallengeable order1045.

6. The President of the Court of Appeal shall designate the Judge-Rapporteur and fix, by decree, the public hearing to discuss the appeal. The decree shall be notified to the parties by the clerk of court at least sixty days before the hearing. The Authority shall file memorandums and documents within ten days before the hearing. If the appellant does not appear at the first hearing without presenting any legitimate excuse, the judge shall declare, with an order subject to appeal to the Court of Cassation, that the appeal cannot go forward and charging the appellant for the expenses of the procedure1046.

7. At the hearing the Court of Appeal shall have, even on its own motion, the evidence it deems necessary, as well as the personal hearing of the parties who have so requested. Then the parties shall proceed to an oral discussion of the case. The judgement is filed with the clerk of court within sixty days. When at least one of the parties would be interested in the advance publication of the order with respect to the judgement, the order is published by filing with the clerk of court no later than seven days from the discussion hearing1047.

7-bis. With the decision, the court of appeal can dismiss the appeal, charging the appellant all the expenses of the procedure, or sustain it, annulling the order entirely or in part, or reducing the amount or term of the sanction1048.

8. A copy of the judgement shall be forwarded, by the clerk of the court of appeal, to the Authority that issued the provision, also for the purposes of publication provided for in Article 195-bis1049.

9. …omissis…1050

Article 195-bis 1051
Publication of sanctions

1. The measure imposing sanctions provided for in this decree shall be published without delay and by extract on the website of the Bank of Italy or in the Bulletin of Consob, in conformity to the European legislation of reference. In the case the provision to apply the sanction is appealed to the court, the Bank of Italy or Consob shall mention the filing of the case and its outcome on the margin of the publication. The Bank of Italy or Consob, taking account of the nature of the violation and the interests involved, may establish further ways of publicizing the measure, charging the related expenses to the perpetrator of the violation, or exclude publishing of the measure, when this could pose a serious risk to the financial markets or cause disproportionate damage to the parties 1052.

2. In the measure to apply the sanction, can publish the sanction in anonymous form when the ordinary one:

a) relates to personal data pursuant to Legislative Decree no. 196 of 30 June 2003, whose publication would be disproportionate to the violation sanctioned;

b) might threaten the stability of the financial markets or affect the conduct of an ongoing criminal investigation;

c) would cause disproportionate damage to the parties involved, provided that the damage can be determined.

3. If the situations described in subsection 2 are of a temporary nature, the publication may be deferred and carried out when these needs no longer exist.

Article 195-ter
Communication to the EBA of sanctions applied

1. The Bank of Italy shall inform EBA of the administrative sanctions applied to banks or investment firms under Articles 189, 190 and 190-bis and 194-quater, including those published in anonymous form, as well as information received from interested parties on actions initiated by them against sanctions and their outcome1053.

Article 195-quater
Sanctions in the case of winding up

1. Investment companies disciplined by Chapter II-bis of Part II, Title IV and the permanent branches in Italy of non-European investment companies which perform the activities indicated by article 55-bis are subject to the application by the Bank of Italy of the fine contemplated by article 190, paragraph 1, for failure to observe articles 9, 15, 16, 19 paragraph 1, 33 paragraphs 6, 50, 58, 59, 60 paragraph 1 letters a) and h) , 70 paragraphs 2 and 3, 80 paragraphs 1, 82 and 83 of the decree [implementing Directive 2014/59/EU]1054, in as far as applicable pursuant to the Legislative Decree or the relative general or specific provisions issued by the Bank of Italy.

2. For non-observance of the provisions referred to in paragraph 1, article 194-quater is applied, in the case of the conditions and in the manner established by the same. In the case of non-observance of the order to cease the infringements contained therein, the sanctions established by articles 194-quater paragraph 2, and 190-bis paragraph 2, will be imposed on the subjects and under the conditions contemplated therein.

3. Without prejudice to the provisions of paragraphs 1 and 2, for non-observance of the provisions referred to by the said paragraphs, the administrative sanctions contemplated by article 190-bis will be imposed on the subjects who perform administrative, management or control functions and on personnel in the case of the conditions and according to the methods contemplated by article 190-bis.

4. The administrative sanctions disciplined by this article are subject to the application of articles 194-bis, 195 and 196-bis.

5. In the case of matters referred to by the provisions indicated in paragraph 1, the sanctions contemplated therein shall be applied, to the same extent and in the same manner, also in the case of breach of the delegated acts or the technical regulatory and enactment standards issued by the European Commission pursuant to Directive 2014/59/EU or articles 10 and 15 of regulation (EU) no. 1093/2010, or in the case of breach of the EBA deeds directly applicable to supervised subjects adopted pursuant to the last-mentioned regulation.

6. The Bank of Italy shall inform EBA of the administrative sanctions applied pursuant to this article, including those published in anonymous form, as well as information received from interested parties on actions initiated by the same against the sanctions and their outcome1055.

Article 196
Sanctions applicable to financial advisors authorised to make offer-premises offers1056

1. Financial advisors authorised to make offer-premises offers who violate the provisions of this decree or general or specific rules issued by Consob pursuant thereto shall be punished, taking account of the seriousness of the violation and recidivism, with one of the following sanctions:

a) a reprimand in writing;

b) a pecuniary administrative sanction of between one million lire and fifty million lire;1057

c) suspension from the register for a period of between one and four months;

d) deletion from the register.1058

2. The sanctions shall be imposed by [Consob1059] with a measure stating the grounds for the decision after it has notified the charges to the interested parties, to be issued within one hundred and eighty days of the examination or three hundred and sixty days if the interested party is resident or its company is registered abroad, and evaluated briefs submitted by them within thirty days. Interested parties may also request to be heard in person within the same time limit1060.

3. The provisions of Law 689/1981 shall apply to the sanctions established by this article, except for Article 16.

4. The companies that use the services of the persons responsible for the violations shall answer jointly and severally with them for payment of the pecuniary sanctions and shall be held to the exercise of the right of recourse against them.

Article 196-bis
Enactment provisions

1. Consob and the Bank of Italy, within their respective competences, shall issue provisions implementing this Title1061.

PART VI
TRANSITIONAL AND FINAL PROVISIONS

Article 197
Consob staff

1. In order to ensure the full and prompt exercise of the control functions established by Article 62 of Law 449/19971062 Consob shall carry out directly all the procedures necessary for the immediate filling of staff positions according to the competitive examination criteria referred to therein, within the limits of its own financial resources and without burdening the public finances.

Article 198
Endorsement of share certificates

1. The power to authenticate endorsements of share certificates provided for in Article 12 of Royal Decree Law 239/1942 may also be exercised by Italian investment companies.

Article 199
Trusts

1. Until the organic reform of the law on trust companies and on auditing firms the provisions of Italian Law n° 1966 of 23 November 1939, and of article 60, subsection 4, of Italian Legislative Decree n° 415 of 23 July 1996, shall remain in force1063.

2. Trust companies referred to by Italian Law n° 1966 of 23 November 1939, which practise the business of the custody and administration of securities and which, alternatively, are controlled directly or indirectly by a bank or a financial intermediary or have adopted the form of a joint stock company and which have paid capital amounting to no less than double the amount requested by article 2327 of the Italian Civil Code, are authorised and entered in a separate section of the register contemplated by article 106 of Italian Legislative Decree n° 385 of 1st September 1993, but which cannot exercise the activities listed in subsection 1 of the same article. If requested article 107 of Italian Legislative Decree n° 385 of 1st September 1993 is applied, as far as compatible. The denial of the authorisation, with relative justification, is communicated to the Ministry of economic development and entails revocation of the authorisation contemplated by article 2 of Italian Law n° 1966 of 23 November 1939, unless, within the term of ninety days from the notification of the refusal provision, the conditions involving the registration obligation are no longer fulfilled. The Bank of Italy exercises the powers indicated in article 108 of Italian Legislative decree n° 385 of 1st September 1993, in order to ensure respect on the part of the trust companies registered in the separate section of the provisions contained in Italian Legislative Decree n° 231 of 21 November 2007 . Registered trust companies are3 subject to articles 110, 113-bis and 113-ter of Italian Legislative Decree n° 385 of 1st September 1993, as far as compatible.

3. The Ministry of Economic Development and the Bank of Italy, as far as concerning the companies referred to in subsection 2, are given reciprocal communication of the measures implemented for the purposes of the adoption of the respective provisions of competence1064.

Article 200
Intermediaries already authorised

1. Investment companies that at the date of entry into force of this decree are entered in the register referred to in Article 9 of Legislative Decree 415/1996 shall be automatically entered in the register referred to in Article 20.

2. Asset management companies that at the date of entry into force of this decree are entered in the register referred to in Article 7(1) of Law 77/1983, the register referred to in Article 3 (1) of Law 344/1993 and the register referred to in Article 3(1) of Law 86/1994 shall be automatically entered in the register referred to in Article 35 and shall be deemed authorised in accordance with Article 34.

3. SICAVs that at the date of entry into force of this decree are entered in the register referred to in Article 9(1) of Legislative Decree 84/1992 shall be automatically entered in the register referred to in Article 44.

4. Banks that at the date of entry into force of this decree are authorised to provide investment services shall remain authorised to provide the same services.

Article 201
Stockbrokers

1. The National Council of Stockbrokers' Associations shall dissolve the professional associations referred to in Article 3 of Law 402/1967, except for the Milan and Rome associations.

2. Stockbrokers shall be entered in the professional register kept by one of the associations referred to in subsection 1, which shall receive payments of the annual fee fixed by the association itself, having regard to entry in the special roll or the national roll referred to in subsections 5 and 6. The association must conserve the books of stockbrokers who are deceased or have been deleted from the single national roll.

3. The other provisions of Law 402/1967 shall be unaffected. Competitive examinations for the appointment of stockbrokers may not be held. Stockbrokers shall be removed from the rolls referred to in subsections 5 and 6 upon reaching the age of seventy. Stockbrokers who were appointed before the entry into force of Law 515/1956 shall be removed from the rolls upon reaching the age of seventy while preserving the rights and duties inherent in the office.

4. The funds in the stockbrokers' common fund and the sureties outstanding at the date of entry into force of this decree shall be returned to those having entitlement.

5. Stockbrokers in office who are members, directors, managers, employees or collaborators of Italian investment companies, banks or asset management companies shall be entered in a special roll kept by the Ministry of the Economy and Finance.1065 They may not provide investment services and may be directors, employees or collaborators of only one of the aforesaid intermediaries. They shall remain individually subject to the incompatibilities established in subsection 11.

6. Stockbrokers in office who are not entered in the special roll referred to in subsection 5 shall be entered in the single national roll kept by the Ministry of the Economy and Finance.1066

7. Stockbrokers entered in the single national roll may perform the investment services referred to in Articles 1(5)(b), (c-bis), (d) and (f). They may also provide their own investment services door-to-door and the non-core services referred to in Articles 1(6)(c), only as regards the conclusion of stock exchange repurchase agreements and other general market transactions, and 1(6)(g), as well as related and instrumental activities, without prejudice to the reservation of activities by law1067.

8. Stockbrokers entered in the single national roll must keep the accounting records referred to in Articles 2144 ff. of the Civil Code; Consob shall lay down in a regulation the procedures for accounting control on the part of auditing firms entered in the special register referred to in Article 1611068.

9. Failure to perform the service of dealing for customer account for a period exceeding six months shall result in disqualification from office, where documented reasons of health are pleaded, the Ministry of the Economy and Finance,1069 after consulting Consob, may extend such time limit up to a maximum of 18 months.

10. In order to perform investment services, stockbrokers shall be members of the compensation systems provided for in Article 59. Coordination of the operations of the compensation systems with the insolvency procedure for stockbrokers shall be governed by the regulation referred to in Article 59(3).

11. The position of stockbroker entered in the single national roll shall be incompatible with the performance of any commercial activity, with participation as a member with unlimited liability of companies of whatever nature, with the position of director or manager of companies that engage in commercial activity and, in particular, with the position of member, director, manager, employee or collaborator of a bank, an Italian investment company or asset management company or any other kind of financial intermediary.

12. Articles 6(1)(a), only as regards administrative and accounting procedures and internal controls, Articles 6(1)(b), 6(2) and (2-bis); 8(1), 10(1), 21-25, 31-32, 167, 171, 190 and 1951070 shall apply to stockbrokers entered in the single national roll.

13. Stockbrokers may not deal for own account in financial instruments, directly or through nominees, except to invest their personal wealth; such investments shall be immediately communicated to Consob.

14. The Chairman of Consob may as a matter of urgency, where customers or markets are in danger, order the suspension of a stockbroker entered in the single national roll from engaging in the activities performed and the appointment of a special administrator to take over the management thereof where serious violations of legislative or administrative provisions are found. Article 53(2-4) shall apply.

15. The Ministry of the Economy and Finance,1071 acting on a proposal from Consob, may issue a decree deleting the stockbroker from the single national roll where the irregularities or violations of legislative or administrative provisions are exceptionally serious. The decree may be also be adopted on a proposal from the special administrator referred to in subsection 14 or at the request of the stockbroker.

16. In the case provided for in subsection 15, the Ministry of the Economy and Finance1072 shall appoint a special administrator for the protection and restitution of the assets belonging to customers. In the performance of his functions the special administrator shall be a public official; he shall act alongside the bodies responsible for bankruptcy proceedings, where these have been established. The Ministry may provide for special safeguards and limitations on the activity of the special administrator and may remove or replace him. The emoluments due to the special administrator shall be determined by the Ministry and charged to the stockbroker. The measures provided for in this subsection may also be adopted following the death of the stockbroker, acting on a proposal from Consob or the special administrator appointed pursuant to subsection 14, or at the request of customers.

17. Deletion of a stockbroker from the single national roll shall result automatically from a judicial finding of insolvency. Consob shall report insolvencies declared under Article 72 to the civil court.

18. Article 190 shall apply to violations of subsections 8, 11 and 13.

Article 202
Provisions on compulsory stock exchange settlement

…omissis…1073

Article 203
Forward contracts

1. Without prejudice to the time limits for the effects of compulsory administrative liquidation referred to in Article 83 of the Consolidated Law on Banking and to the provisions of Article 90(3) thereof, Article 76 of the Bankruptcy Law shall apply to derivative financial instruments, to the analogous instruments identified pursuant to Article 18(5)(a), to foreign exchange forward transactions, securities lending transactions, repurchase agreements and stock exchange repos. All contracts concluded, even if not yet executed in full or in part, by the date of declaration of bankruptcy or the date from which the decree of compulsory administrative liquidation has effect shall be included for the purposes of this article.

2. For the application of Article 76 of the Bankruptcy Law to financial instruments and transactions specified in subsection 1, reference may also be made to the replacement cost of the same, calculated according to market values at the date of declaration of bankruptcy or the date from which the decree of compulsory administrative liquidation has effect.

Article 204
Central depository services

1. Within twenty-four months of the date of entry into force of this decree, the Bank of Italy shall arrange for the disposal of its shareholding in "Monte Titoli S.p.A. Istituto per la custodia e l'amministrazione accentrata di valori mobiliari".

2. Until the issue of the decrees provided for in Article 90, the central depository for government securities at the Bank of Italy shall continue to be governed by the provisions previously in force.

Article 205
Price quotations

1. The offers for the purchase and sale of financial products on regulated markets, in multilateral trading systems and, if the conditions indicated by Consob by regulation are fulfilled, by systematic internalisers, do not represent the offer to the public of financial products or purchase or swap offers to the public pursuant to Part IV, Title II1074.

Article 206
Rules applicable to companies listed on markets other than the stock exchange

1. The provisions of the Civil Code referring to companies with shares listed on the stock exchange shall apply to all companies with shares listed on regulated markets in Italy or other EU countries.

Article 207
Shareholders' agreements

1. Shareholders' agreements referred to in Article 122 and existing at the date of entry into force thereof shall be entered in the Company Register within one month of such date.

2. Fixed-term shareholders' agreements existing at the date of entry into force of this decree shall remain in effect until the time limit agreed but not beyond 1 July 2001.

3. Without prejudice to subsection 2, Article 123 shall also apply to permanent agreements existing at the date of entry into force of this decree.

Article 208
Proxies, saving shares, boards of auditors and auditing firms

1. The provisions concerning proxies shall apply to shareholders' meetings called as of the sixtieth day following the issue of the regulations provided for in Article 144.

2. The provisions concerning saving shares shall also apply to savings shares already issued at the date of entry into force of this decree.

3. Companies with listed shares shall apply the provisions concerning the appointment of the board of auditors as of the first renewal following the date of entry into force of this decree. Until the issue of the regulation provided for in Article 148(4), the second subsection of Article 2397 of the Civil Code shall apply.

4. Boards of auditors appointed before the entry into force of this decree but following its publication in the Gazzetta Ufficiale della Repubblica italiana shall remain in office for one financial year only.

5. The other provisions concerning boards of auditors and those concerning auditing firms shall apply as of the financial year commencing on 1 July 1998 or thereafter.

Article 209
Auditing firms

1. Auditing firms that at the date of entry into force of this decree are entered in the register referred to in Article 8 of Presidential Decree 136/1975 shall be automatically entered in the register referred to in Article 161.

2. For the purposes of entering auditors in the register kept at the Ministry of Justice, the time limit laid down in Article 13(1) of Law 132/1997 shall be extended to the sixtieth day following the date of entry into force of this decree.

3. Companies with listed shares shall conserve a copy of the auditing firms' report on the annual accounts for the purposes of audits by the tax authorities of the corresponding income tax returns. Where such conservation is omitted, Article 39, second subsection, of Presidential Decree 600/1973 shall apply.

Article 210
Amendments to the Civil Code

1. In the fourth subsection of Article 2372 of the Civil Code, the words "or on banks or credit institutions" shall be suppressed.

2. The seventh subsection of Article 2441 shall be replaced by the following:

"The right of pre-emption shall not be considered excluded or limited where the resolution to increase the capital provides for the newly-issued shares to be subscribed for by banks, financial entities or companies subject to supervision by the Commissione Nazionale per le Società e la Borsa or other persons authorised to engage in the placement of financial instruments, with the obligation to offer them to the shareholders of the company, with whatsoever type of transaction, in conformity with the first three subsections of this article. During the period in which they hold the shares offered to the shareholders and in any case until the right of pre-emption has been exercised, such persons may not exercise the voting rights. The costs of the operation shall be borne by the company and the resolution to increase the capital must indicate their amount".

3. The following paragraph shall be inserted in the first subsection of Article 2630 of the Civil Code:

"4) fail to offer on the stock exchange, within the time limits and in the manner established by the third subsection of Article 2441, the unexercised pre-emption rights if the related shares are subscribed for."

4. The following subsection shall be added to Article 2633 of the Civil Code:

"Directors who issue convertible bonds without the indications prescribed in the last subsection of Article 2420-bis shall be punished by a fine of between 2 million and 10 million lire.

5. In the provisions for the implementation of the Civil Code and transitional provisions, approved with Royal Decree 318 of 30 March 1942, the following article shall be inserted after Article 211:

"211-bis. The second sentence of Article 2441, seventh subsection, of the Code shall not apply to the shares held at 7 March 1992 by the persons indicated in the same subsection, with the obligation to offer them to the shareholders."

Article 211
Amendments to the Consolidated Law on Banking

1. Article 52 of the Consolidated Law on Banking shall be replaced by the following:

"Article 52 - Notifications by the board of auditors and the persons engaged to perform the statutory audit of the accounts

1. The board of auditors shall inform the Bank of Italy without delay of any act or fact it comes to know of in the performance of their duties that may constitute an irregularity in the management of banks or a violation of the rules governing banking.

2. Firms engaged to audit the accounts of banks shall notify the Bank of Italy without delay of the acts or facts found in the performance of the engagement that may constitute a serious violation of the provisions governing banking, jeopardize the continued existence of the undertaking or result in their rendering an adverse opinion or a qualified opinion on the annual accounts or a disclaimer. Such firms shall send the Bank of Italy all other information and documents requested.

3. Subsections 1 and 2 shall also apply to persons who perform the duties referred to therein at companies that control banks or are controlled by them within the meaning of Article 23.

4. The Bank of Italy shall establish the manner and time limits for the transmission of the information referred to in subsections 1 and 2."

2. The following subsection shall be added to Article 107 of the Consolidated Law on Banking:

"6. Financial intermediaries entered in the special register that have been authorised to provide investment services or have accepted repayable funds for an amount exceeding their capital shall be subject to Title IV, Chapter I, Sections I and III; in place of Articles 86(6), 86(7) and 87(1), Articles 57(4) and 57(5) of the consolidated law on financial markets, issued pursuant to Article 21 of Law 52/1996, shall apply."

3. The following subsection shall be added to Article 111 of the Consolidated Law on Banking:

"5. This article shall not apply in the cases referred to in Article 107(6)."

4. Article 160 of the Consolidated Law on Banking is repealed.

Article 212
Provisions concerning privatizations

1. The second sentence of Article 3(3) of Decree Law 332/1994, ratified with amendments by Law 474/1994, shall be replaced by the following: "... omissis ...".

Article 213
Conversion of bankruptcy into compulsory administrative liquidation

1. From the date of entry into force of this decree bankruptcy procedures for intermediaries referred to in Article 107 of the Consolidated Law on Banking for which the conditions indicated in subsection 6 thereof are satisfied and the statement of liabilities has not yet been declared enforceable shall be converted into compulsory administrative liquidation procedures.

2. Without prejudice to the judicial finding of insolvency already declared, the court, proceeding on its own authority or otherwise, shall declare the company subject to compulsory liquidation with a ruling in camera and shall order the transfer of the record to the Ministry of the Economy and Finance1075 for the issue of the related decree and to the Bank of Italy.

3. The bodies of the terminated procedure and those of the compulsory liquidation shall promptly effect the handing over of the company and give notice thereof in the manner established by the Bank of Italy. The effects of acts legally completed shall not be prejudiced.

Article 214
Repeals

1. Without prejudice to what is provided for in subsections 2 and 3, the following provisions are or remain repealed:

a) Articles 11(1), 12-17, 22, 25, 26, 28, 31, 45-52 and 58-60 of Law no. 272 of 20 March 1913 and subsequent amendments;

b) Articles 26 to 43, 44(2), 46(2), 47, 49, 51, 54, last sentence, 56, 61(2), 97, and 106 to 108 of Royal Decree 1068 of 4 August 1913;

c) Articles 2 to 10 of Royal Decree Law no. 222 of 7 March 1925, ratified by Law no. 597 of 21 March 1926;

d) Royal Decree Law no. 375 of 9 April 1925, ratified by Law no. 597 of 21 March 1926;

e) Royal Decree 376 of 9 April 1925;

f) Articles 4, 6 and 7 of Royal Decree Law no. 601 of 14 May 1925, ratified by Law no. 562 of 18 March 1926;

g) Royal Decree Law no. 1047 of 26 June 1925, ratified by Law no. 562 of 18 March 1926;

h) Royal Decree Law no. 1261 of 29 July 1925, ratified by Law no. 562 of 18 March 1926;

i) Royal Decree Law no. 1748 of 11 October 1925, ratified by Law no. 562 of 18 March 1926;

j) Royal Decree Law no. 950 of 1 9 February 193 1, ratified by Law no. 1657 of 31 December 1931;

k) Articles 1 to 11 and 14 to 18 of Royal Decree Law no. 815 of 30 June 1932, ratified by Law no. 118 of 5 January 1933;

l) Royal Decree Law no. 1607 of 20 December 1932, ratified by Law no. 291 of 20 April 1932;

m) Law no. 1913 of 4 December 1939.

n) Article 2369-bis of the Civil Code, approved by Royal Decree 262 of 16 March 1942;

o) Viceregal Legislative Decree no. 250 of 18 September 1944.

p) Viceregal Legislative Decree no. 321 of 19 April 1946;

q) Law no. 515 of 23 May 1956;

r) Law no. 1778 of 31 December 1962;

s) Articles 1, eleventh subsection, 2, tenth subsection, first and second sentences, 3, 4, 4-bis, 4-ter, 5-quinquies, 5-sexies, 9, second subsection, 13, second subsection, 14, 15, 16, 17, 18, sixth subsection, 18-ter 18-quinquies, fifth subsection, and 18-septies, second sentence, of Decree Law no. 95 of 8 April 1974, ratified with amendments by Law no. 216 of 7 June 1974 and subsequent amendments;

t) Presidential Decree no. 136 of 31 March 1975;

u) Presidential Decree no. 137 of 31 March 1975;

v) Presidential Decree no. 138 of 31 March 1975, except for Articles 16 and 18;

w) Law no. 49 of 23 February 1977;

x) Law no. 77 of 23 March 1983, except for Articles 9 and 10-ter;

y) Law no. 289 of 19 June 1986;

z) Presidential Decree no. 556 of 12 December 1987;

aa) Law no. 1 of 2 January 1991;

bb) Law no. 157 of 17 May 1991, except for Article 10;

cc) Legislative Decree no. 84 of 25 January 1992, except for Article 14;

dd) Legislative Decree no. 86 of 27 January 1992, except for Article 4;

ee) Law no. 149 of 18 February 1992;

ff) Law no. 344 of 14 August 1993, except for Article 11;

gg) Article 1(1)(m) and Article 2(1)(f) of Law no. 561 of 28 December 1993;1076

hh) Law no. 86 of 25 January 1994, except for Articles 14-bis and 15;

ii) Article 5(3), 5(4), 5(5) and 8 of Decree Law no. 332 of 31 May 1994, ratified with amendments by Law no. 474 of 30 July 1994;

jj) Legislative Decree no. 415 of 23 July 1996, except for Articles 60(4), 62, 63, 64 and 65.

2. The following are repealed but shall continue to apply until the date of entry into force of the provisions issued pursuant to this decree:

a) Articles 5, 5-bis, 5-ter and 5-quater of Decree Law no. 95 of 8 April 1974, ratified with amendments by Law no. 216 of 7 June 1974 and subsequent amendments; related violations shall be punished under Articles 173 and 174 or sanctioned under Article 193(2);

b) Articles 18, except for the sixth subsection, 18-bis, 18-quater, 18-quinquies, except for the fifth subsection, 18-sexies and 18-septies, except for the second sentence, of Decree Law no. 95 of 8 April 1974, ratified with amendments by Law no. 216 of 7 June 1974 and subsequent amendments; related violations shall be sanctioned under Article 191;

c) Article 3 of Presidential Decree no. 136 of 31 March 1975;

d) Articles 1(1-9), 1(11), 2(2-3), 2-bis (3), 2-bis (4), 2-bis (5), 2-bis (7), 2-ter, 3(3-4), 4(2-14), 7(3), 7(5-6) and 10-bis of Law no. 77 of 23 March 1983; related violations shall be sanctioned under Article 190;

e) Articles 3(2)(b), 3(2)(c), 3(2)(d), 3(2)(e), 4(2), 9(12-14), and 15 of Law no. 1 of 2 January 1991; related violations shall be punished under Article 169 or sanctioned under Articles 189 and 190;

f) Article 6 of Law no. 157 of 17 May 1991; related violations shall be punished under Article 174 or sanctioned under Article 193;

g) Articles 2-4 and 6-7 of Law no. 149 of 18 February 1992; related violations shall be sanctioned under Article 191;

h) Articles 1O, 14, 15, 16(1), 20(1), 20(4), 22-25, 27 and 28 of Law no. 149 of 18 February 1992; related violations shall be sanctioned under Article 192;

i) Articles 1, 2(3), 2(4), 4(1), 4(4), 5(3), 5(6-11), 6(2), 7(1-6), 8 and 9(2-3) of Legislative Decree no. 84 of 25 January 1992; related violations shall be sanctioned under Article 190;

j) Articles 1 and 2(2)(a) of Legislative Decree no. 86 of 27 January 1992;

k) Articles 1(1-7), 3(2), last sentence, 4(1-5), 5(1-4). 8(2), 8(4-5), 9 and l0 of Law- 344 of 14 August 1993; related violations shall be sanctioned under Article 190;

l) Articles 1(1-6), 3(2), last sentence, 4(1-6), 5(1-4), 7, 8, 9, 12(2), 12(5), 13 and 14 of Law no. 86 of 25 January 1994; related violations shall be sanctioned under Article 190;

m) Articles 2(4), 6(3-4), 7, 8, 10. 13, 14, 15, 18(1), 18(3), 20(1)(e), 21(2-3), 22(2), 23(5-6), 24, 25, 35(2-3), 66(1)(b), 66(1)(c) and 66(1)(e) of Legislative Decree no. 415 of 23 July 1996; related violations shall be punished under Article 169 or sanctioned under Articles 189 and 190.

3. Until the issue of the regulations provided for in Articles 80(4), 80(5) and 80(6) and in any case until the completion of the sale referred to in Article 204(1), Articles 1 and 10-14 of Law no. 289 of 19 June 1986 shall apply.

4. Every other provision incompatible with this decree is repealed. Reference to the repealed provisions by statutory provisions, regulations or other measures shall be deemed to refer to the corresponding provisions of this decree and the measures provided for therein.

5. Provisions issued pursuant to provisions repealed or replaced shall continue to apply, insofar as they are compatible, until the date of entry into force of the provisions issued pursuant to this legislative decree concerning the corresponding matters. In the event of violations, Articles 190-193 shall apply, with the procedure provided for in Article 195, in relation to the matters respectively governed therein.

Article 215
Implementing provisions

1. The regulations and provisions of a general nature to be issued pursuant to this decree shall be adopted initially within six months of the date of its entry into force.

Article 216
Entry into force

1. This decree shall enter into force on 1 July 1998.


ANNEX 1077

Section A – Investment services and activities

(1) Reception and transmission of orders in relation to one or more financial instruments.

(2) Execution of orders on behalf of customers.

(3) Dealing for own account.

(4) Portfolio management.

(5) Investment consultancy.

(6) Subscription and/or placement of financial instruments with firm or standby commitment to the issuer.

(7) Placement of financial instruments without firm or standby commitment to issuers.

(8) Management of multilateral trading systems.

Section B – Accessory services

(1) Safety deposit box rental and the administration of financial instruments on behalf of customers, including custody and related services such as cash/security guarantees.

(2) Allocation of credit or loans to investors in order to perform a transaction relating to one or more financial instruments, involving the company granting the credit or loan.

(3) Business consultancy on capital structuring, industrial strategy and related matters, together with consultancy and services in relation to business mergers and takeovers.

(4) Exchange service where such service is linked to the provision of investment services.

(5) Investment research and financial analysis or other forms of general recommendation regarding transactions on financial instruments.

(6) Related services with firm commitment.

(7) Investment services and activities, together with accessory services of types indicated in sections A or B, linked to derivatives as per section C, points (5), (6), (7) and (10), if linked to the provision of investment or accessory services.

Section C – Financial instruments.

(1) Securities.

(2) Money market instruments.

(3) Units in collective investment undertakings.

(4) Options, futures, swaps, future contracts on interest rates and other derivative contracts on securities, currency, interest rates or returns, or other derivatives, financial indices or financial measures that may be settled by physical delivery of the underlying asset or by payment of the differentials in cash.

(5) Options, futures, swaps, future contracts on interest rates and other derivative contracts on commodities, the settlement of which may be by payment of the differentials in cash or at the discretion of one of the parties, except in cases where such option is the result of default or other event leading to cancellation of the contract.

(6) Options, futures, swaps, future contracts on interest rates and other derivative contracts on commodities, the settlement of which may be by physical delivery of the underlying asset and which are traded on a regulated market and/or multilateral trading systems.

(7) Options, futures, swaps, forward contracts and other derivative contracts on commodities, the settlement of which may be by physical delivery of the underlying asset, other than those indicated in point 6, that have no commercial purpose, and with the characteristics of other derivatives, taking into consideration, amongst other things, whether they are cleared and executed through recognised clearing houses or whether they are subject to regular margin calls.

(8) Derivatives for the transfer of credit risk.

(9) Differential financial contracts

(10) Options, futures, swaps, interest rate futures and other derivative contracts on climatic variables, transport rates, emission levels, inflation rates or other official economic statistics, the settlement of which is by payment of the differentials in cash or at the discretion of one of the parties, except in cases where such option is the result of default or other event leading to cancellation of the contract, and other derivative contracts on commodities, options, bonds, indices and measures other than those indicated in the previous points, with the characteristics of other derivatives, taking into consideration, amongst other things, whether they are traded on a regulated market or multilateral trading systems, whether they are cleared through recognised clearing houses or whether they are subject to regular margin calls.


Notes:

1 Published in the Ordinary Supplement of Official Gazette no. 71 of 26.3.1998. Legislative Decree 58/1998 was subsequently amended by Decree Law 351/2001, (ratified by Law 410/2001 (published in Official Gazette no. 274 of 24.11.2001), Legislative Decree 274/2003 (published in Official Gazette no. 233 of 7.10.2003), Law 326/2003 (published in Official Gazette no. 274 of 25.11.2003), Law 350/2003 (published in the Official Gazette of  24.11.2001), Legislative Decree 37/2004 (published in the Ordinary Supplement, Official Gazette no. 37 of 14.2.2004), Legislative Decree 170/2004 (published in Official Gazette no. 164 of 15.7.2004); Legislative Decree 197/2004 (published in Official Gazette no. 182 of 5.8.2004), Article 9 of Law 62/2005 (published in the Ordinary Supplement, Official Gazette no. 96 of 27.4.2005, Law 262/2005 (published in the Ordinary Supplement, Official Gazette no. 301 of 28.12.2005) and Legislative Decree 303/2006 (published in Ordinary Supplement no. 5/L, Official Gazette no. 7 of 10.1.2007), Art. 2 of Legislative Decree no. 297 of 27.12.2006, coordinated with Enactment Law no. 15 of 23.2.2007 (published in Official Gazette no. 46 of 24.2.2007); Art. 10 of Law no. 13 of 6.2.2007 – 2006 Community Law (published in Ordinary Supplement no. 41/L, Official Gazette no. 40 of 17.2.2007); of Art. 2 of the Legislative Decree no. 32 of 2.2.2007 (published in Official Gazette no. 73 of 28.3.2007); Legislative Decree no. 51 of 28.3.2007 (published in Official Gazette no. 94 of 23.4.2007); Legislative Decree no. 164 of 17.9.2007 (published in Ordinary Supplement no. 200/L, Official Gazette no. 234 of 8.10.2007); Legislative Decree no. 195 of 6.11.2007 (published in Ordinary Supplement no. 228, Official Gazette no. 261 of 9.11.2007); Legislative Decree no. 229 of 19.11.2007 (published in Official Gazette no. 289 of 13.12.2007); Legislative Decree no. 173 of 3.11.2008 (published in Official Gazette no. 260 of 6.11.2008) and Decree Law no. 185 of 29.11.2008 (published in Ordinary Supplement no. 263/L, Official Gazette no. 280 of 29.11.2008) co-ordinated with the conversion law no. 2 of 28 January 2009 (published in Ordinary Supplement no. 14/L, Official Gazette no. 22 of 28.1.2009), Decree Law no. 5 of 10.2.2009 (published in Official Gazette no. 34 of 11.2.2009) co-ordinated with the conversion law no. 33 of 9 April 2009 (published in Ordinary Supplement no. 49/L, Official Gazette no. 85 of 11.4.2009); Law 69/2009 (published in Ordinary Supplement no. 95/L, Official Gazette no. 140 of 19.6.2009); Legislative Decree no. 101 of 17.7.2009 (published in Official Gazette no. 178 of 3.8.2009), Legislative Decree no. 146 of 25.9.2009 (published in Official Gazette no. 246 of 22.10.2009). Legislative Decree no. 21 of 27.1.2010 (published in Official Gazette no. 44 of 23.2.2010); Legislative Decree no 27 of 27.1.2010 (published in Ordinary Supplement no. 43/L, Official Gazette no. 53 of 5.3.2010), the amendments made by Legislative Decree no. 27 of 27.1.2010 shall enter into force on 20 March 2010 unless otherwise envisaged in the final provisions of Article 7 of that Decree; Legislative Decree no. 39 of 27.1.2010 (published in Ordinary Supplement no. 58/L, Official Gazette no. 68 of 23.3.2010), the amendments made by Legislative Decree no. 39 of 27.1.2010 shall enter into force on 7 April 2010 unless otherwise envisaged in the final and transitional provisions of Article 43 of that Decree; Decree Law no 78 of 31.5.2010 (published in Ordinary Supplement no. 114/L, Official Gazette no. 125 of 31.5.2010), coordinated with conversion law no. 122 of 30.7.2010 (published in Ordinary Supplement no. 174, Official Gazette no. 176 of 30.7.2010); Legislative Decree no. 104 of 2.7.2010 (published in Ordinary Supplement no. 148/L, Official Gazette no. 156 of 7.7.2010), the amendments introduced by Legislative Decree no. 104 of 2.7.2010 entered into force on 16.9.2010; Legislative Decree no. 141 of 13.8.2010 (published in Ordinary Supplement no. 212/L, Official Gazette no. 207 of 4.9.2010), the amendments introduced by Legislative Decree no. 141 of 13.8.2010 entered into force on 19.9.2010; Legislative Decree no. 176 of 5.10.2010 (published in Official Gazette no. 253 of 28.10.2010), the amendments introduced by Legislative Decree no. 176 of 5.10.2010 entered into force on 12.11.2010; from Italian Legislative Decree no. 224 of 29.11.2010 (published in O. J. no. 300 of 24.12.2010), the changes made from Italian Legislative Decree no. 224 of 29.11.2010 are in force froml’8.1.2011; from Italian Legislative Decree no. 239 of 30.12.2010 (published in O. J. no. 9 of 13.1.2011), the changes made from Italian Legislative Decree no. 239 of 30.12.2010 are in force from the date on which it was published in the O. J.; from Italian Legislative Decree no. 259 of 30.12.2010 (published in O. J. no. 30 of 7.2.2011), the changes made from Italian Legislative Decree no. 259 of 30.12.2010 are in force from 22.2.2011; from Italian Law Decree no. 26 of 25.3.2011 (published in O. J. no. 70 of 26.3.2011) in force from 27.3.2011, converted with Italian Law no. 73 of 23.5.2011 (published in O. J. no. 120 of 25.5.2011); from Italian Legislative Decree no. 48 of 24.3.2011 (published in O. J. no. 92 of 21.4.2011) in force from 30.6.2011; by Law no. 120 of 12 July 2011 (published in O.J. no. 174 of 28.7.2011) in force from 12.8.2011; from Law no. 217 of 15 December 2011 (published in O.J. no. 1 of 2.1.2012) in force from 17.1.2012; from Italian Legislative Decree no. 47 of 16 April 2012 (published in O.S. no 86/L to O.J. no. 99 of 28.4.2012) in force from 13.5.2012. by Italian Legislative Decree no. 91 of 18 June 2012 (published in the Official Gazette no. 152 of 2.7.2012) in force from 17.7.2012, without prejudice to that established by the final provisions dictated by art. 5 of the said Decree; by the decision of the Constitutional Court no. 162 of 27.6.2012 (published in the Official Gazette, 1st Special Series, no. 27 of 4.7.2012); by Italian Legislative Decree no. 130 of 30 July 2012 (published in the Official Gazette no. 184 of 8.8.2012) in effect as from 23.8.2012; by Italian Legislative Decree no. 160 of 14 September 2012 (published in the Official Gazette no. 218 of 19.9.2012) in effect as from 3.10.2012. by Italian Legislative Decree no. 169 of 19.9.2012 (published in the O.J. no. 230 of 2.10.2012) in effect from 17.10.2012; by Italian Decree Law no. 179 of 18.10.2012 (published in O.S. no. 194/L to O.J. n. 245 of 19.10.2012), in effect from 20.10.2012; coordinated with conversion law no. 221 of 17.12.2012 (published in O.S. no. 208/L to O.J. no. 294 of 18.12.2012), in effect from 19.12.2012; by Italian Legislative Decree no. 184 of 11.10.2012 (published in O.J. no. 253 of 29.10.2012), in effect from 13.11.2012; by Legislative Decree no. 69 of 21.6.2013, (published in Ord. Suppl. no. 50 of Official Gazette no. 144 of 21.6.2013), in force from 22.6.2013, converted with amendments from Law no. 98 of 9.8.2013, (published in Ord. Suppl. no. 63 of the Official Gazette no. 194 of 20.8.2013), in force from 21.8.2013; by Law no. 97 of 6.8.2013 (published in Official Gazette no. 194 of 20.8.2013), in force from 4.9.2013, without prejudice to the rulings of the transitional provisions established by art. 89, paragraphs 3 and 4, of Regulation (EU) no. 648/2012 of the European Parliament and of the Council, of 4 July 2012; by Italian Legislative Decree no. 44 of 4.3.2014 (published in Official Journal no. 70 of 25.3.2014) in force as of 9.4.2014, without prejudice to the transitory provisions contemplated by art. 15 of the same Italian Legislative Decree; by Italian Legislative Decree no. 53 of 4.3.2014 (published in Official Journal no. 76 of 1.4.2014) in force as of 16.4.2014; by Constitutional Court Decision no. 94 of 9/15.4.2014 (Official Gazette 1a Special Series no. 18 of 23.4.2014); by Italian Legislative Decree no. 91 of 24.6.2014 (published in the Official Gazette no. 144 of 24.6.2014), in force since 25.6.2014 (see also notice of amendment in the Official Gazette no. 150 of 1.7.2014), coordinated with conversion law no. 116 of 11.8.2014 (published in the Ord. Suppl. no. 72 of the Official Gazette no. 192 of 20.8.2014), in force from 21.8.2014; by Law no. 161 of 30.10.2014 (published in the Ord. Suppl. no. 83/L of the Official Gazette no. 261 of 10.11.2014), in force from 25.11.2014; by decree law no. 133 of 12.9.2014, (published in the Official Gazette no. 212 of 12.9.2014), in force since 13.9.2014 converted with amendments by Law no. 164 of 11.11. 2014, (published in the Ord. Suppl. no. 85 of the Official Gazette no. 262 of 11.11.2014), which has introduced Section 119-ter into Art. 1 of Law 296 of 27.12. 2006, no. 296 (in the Ord. Suppl. no. 244 of the Official Gazette no. 299 of 27.12.2006); by Law no. 161 of 30.10.2014 (published in the Ord. Suppl. no. 83/L of the Official Gazette no. 261 of 10.11.2014), in force since 25.11.2014; by Decree Law no. 3 of 24.1.2015 (published in the Official Gazette no. 19 of 24.1.2015), in force since 25.1.2015, converted with amendments by Italian Law no. 33 of 24.3.2015 (published in Ordinary Supplement no. 15 of Official Gazette no. 70 of 25.3.2015), in force since 26.3.2015.; by Italian Legislative Decree no. 66 of 7.5.2015 (published in Official Journal no. 116 of 21.5.2015) in force as of 5.6.2015; by Italian Legislative Decree no. 72 of 12.05.2015 (published in Official Journal no. 134 of 12.06.2015), in force since 27.06.2015, except as provided for by the transitional dispositions of Art. 6 of the same decree. Subsection 1 of Legislative Decree no. 72 of 12.05.2015 provides that: “The regulations issued by the Minister of Economy and Finance pursuant to provisions repealed or amended by this decree shall continue to apply until the date of entry into force of the provisions issued by Consob and the Bank of Italy on the corresponding matters”; by Italian Law no. 208 of 28.12.2015 (published in the Ordinary Section no. 70 of the Official Journal no. 302 of 30.12.2015), in force since 1.1.2016; by Italian Legislative Decree no. 18 of 14.2.2016 (published in the Official Journal no. 37 of 15.2.2016), in force since 16.2.2016; by Italian Legislative Decree no. 25 of 15.2.2016 (published in the Official Journal no. 52 of 3.3.2016), in force since 18.3.2016, without prejudice to the transitory provisions contemplated by Article 2 of the same decree.

2 Letter thus replaced by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

3 Letter inserted by art. 2 of Italian Legislative Decree no. 130 of 30.7.2012 (published in the Official Gazette no. 184 of 8.8.2012).

4 Paragraph amended by art. 1 Legislative Decree no. 164 of 17.9.2007 (published in the Ordinary Supplement no. 200/L of Official Gazette no. 234 of 8.10.2007).

5 Paragraph amended by Article 1 of Legislative Decree no. 164 of 17.9.2007

6 Paragraph amended by art. 1 Legislative Decree no. 164 of 17.9.2007.

7 Letter thus replaced by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

8 Letter included by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

9 Letter included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

10 Letter already amended by art. 5 of Italian Decree Law 351 of 25.9.2001, converted into Italian Law no. 410 of 23.11.2001 and then substituted first by art. 32, subsection 1 of Italian Decree Law no. 78 of 31.5.2010, converted into Italian Law no. 122 of 30.7.2010 and lastly by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

11 Letter first replaced by Art. 1 of Italian legislative Decree no. 44 of 4.3.2014 and then amended by Art. 22, section 5 of Italian Decree Law no. 91 of 24.6.2014, converted with amendments by Italian Law no. 116 of 11.8.2014, which after the word: "credits" has introduced the words: ", included those issued from the capital of the UCITS" and by paragraph 1 of art. 17 Italian Legislative Decree no. 18 of 14.2.2016 which, after the words: "included in those issued" has included the words: ", in favour of subjects other than consumers,". Law no. 296 of 27.12.2006, as amended by Decree Law no. 133 of 12.9.2014, converted with amendments by Law no. 164 of 11.11.2014, has ruled (with Art. 1, Section 119-ter) that "The SIIQ are not collective investment bodies pursuant to legislative decree n° 58 of 24 February 1998".

12 Letter included by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

13 Letter included by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

14 Letter thus replaced by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

15 Letter thus replaced by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

16 Letter first included by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 and subsequently thus replaced by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

17 Letter first included by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 and subsequently thus replaced by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

18 Letter first included by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 and subsequently thus replaced by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

19 Letter first included by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 and subsequently thus replaced by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

20 Letter first included by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 and subsequently thus replaced by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

21 Letter included by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

22 Letter included by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

23 Letter included by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

24 Letter included by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

25 Letter included by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

26 Letter included by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

27 Letter already substituted by art. 2 of Italian Legislative Decree no. 274 of 1.8.2003; then amended by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 which introduced number 2-bis and lastly substituted again by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

28 Paragraph as amended by Article 2 of Legislative Decree 274/2003.

29 Letter first included by art. 2 of Italian Legislative Decree no. 274 of 1.8.2003 and subsequently thus replaced by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

30 Letter first replaced by art. 2 of Italian Legislative Decree no. 274 of 1.8.2003 and lastly by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

31 Letter first replaced by art. 2 of Italian Legislative Decree no. 274 of 1.8.2003 and lastly by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

32 Letter first included by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 and subsequently thus replaced by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

33 Letter first included by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 and subsequently thus replaced by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

34 Letter first included by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 and subsequently thus replaced by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

35 Letter included by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

36 Letter substituted first by art. 2 of Italian Legislative Decree no. 274 of 1.8.2003, then by art. 1 of Italian Legislative Decree no. 164 of 17.9.2007, the amended by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 and lastly substituted again by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014.

37 Letter first introduced by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 and subsequently thus amended by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014, which replaced the words: "harmonised management company" with the words: "EU management company".

38 Letter included by art. 1 of Italian Legislative Decree no. 47 of 16.04.12.

39 Letter included by art. 1 of Italian Legislative Decree no. 66 of 7.5.2015.

40 Letter included by art. 1 of Italian Legislative Decree no. 66 of 7.5.2015

41 Paragraph amended by art. 1 Legislative Decree no. 164 of 17.9.2007.

42 Paragraph modified by Article 3 of Italian Legislative Decree no. 303 of 29.12.2006 and later substituted by Article 2 of Italian Legislative Decree no. 51 of 28.3.2007

43 The wording: "bank or postal deposits without the issue of financial instruments shall not constitute financial products” has been added by Art. 3 of Legislative Decree No.303 of 29.12.2006.

44 Paragraph amended by art. 1 Legislative Decree no. 229 of 19.11.2007 which replaced the words: “greater than that indicated in the regulation pursuant to article 100, and of a total amount greater than that indicated in said regulation;” with the words “and of a total amount greater than that indicated in the regulation pursuant to article 100, subsection 1, paragraphs b) and c); an offering of securities issued by the central banks of EU Member States shall not constitute a mandatory takeover bid or exchange tender offering;”.

45 Letter thus replaced by Article 1 of Italian Legislative Decree no. 25 of 15.2.2016.

46 Paragraph added by Article 3 of Legislative Decree No. 303 of 29.12.2006.

47 Paragraph first added by art. 2 Legislative Decree no. 51 of 28.3.2007 and later replaced by art. 1 Legislative Decree no. 164 of 17.9.2007.

48 Number thus amended by Article 1 of Italian Legislative Decree no. 25 of 15.2.2016 which has replaced the word: "the" with the word: "the" and the words: "of the European Community, with head office in Italy" with the words: "of the European Union, with registered office in Italy".

49 Number thus amended by Article 1 of Italian Legislative Decree no. 25 of 15.2.2016 which replaced the words: "of the European Community, with head office in Italy" with the words: "of the European Union, with registered office in Italy".

50 Number thus replaced by Article 1 of Italian Legislative Decree no. 25 of 15.2.2016.

51 Number thus replaced by Article 1 of Italian Legislative Decree no. 25 of 15.2.2016 which has replaced the words: "with head office" with the words: "with registered office", in the second sentence has suppressed the words: "as Member State" and, in the third sentence, has replaced the words: "of the European Community" with the words: "of the European Union, or unless the issuer, in the three-year term, is included in the issuers referred to under numbers 1), 2), 3) and 4-bis), of this letter".

52 Number added by Article 1 of Italian Legislative Decree no. 25 of 15.2.2016.

53 Letter first included by Article 1 of Italian Legislative Decree no. 195 of 6.11.2007 and subsequently amended by Article 1 of Italian Legislative Decree no. 25 of 15.2.2016, in the terms indicated in the preceding notes.

54 Letter first included by Article 20 of Italian Decree Law no. 91 of 24.6.2014, converted with amendments by Law no. 116 of 11.8.2014 and subsequently thus replaced by Article 1 of Italian Legislative Decree no. 25 of 15.2.2016.

55 Letter added by art. 33 of Law no. 97 of 6.8.2013.

56 Letter added by art. 2 of Italian Legislative Decree no. 181 of 16/11/2015.

57 Paragraph included by art. 1 Legislative Decree no. 164 of 17.09.2007

58 Subsection included by art. 1 Legislative Decree no. 164 of 17.09.2007

59 Paragraph included by art. 1 Legislative Decree no. 164 of 17.09.2007

60 Subsection as amended by art. 1 Legislative Decree no. 164 of 17.09.2007. See Ministry of the Economy and Finance decree no. 44 of 2.3.2007 (published in Official Gazette no. 81 of 6.4.2007).

61 Subsection replaced by art. 1 Legislative Decree no. 164 of 17.09.2007.

62 Subsection as replaced by art. 9, Legislative Decree no. 141 of 13.08.2010.

63 Subsection replaced by art. 1 Legislative Decree no. 164 of 17.09.2007

64 Subsection included by art. 1 Legislative Decree no. 164 of 17.09.2007

65 Subsection included by art. 1 Legislative Decree no. 164 of 17.09.2007

66 Subsection included by art. 1 Legislative Decree no. 164 of 17.09.2007

67 Subsection included by art. 1 Legislative Decree no. 164 of 17.09.2007

68 Subsection included by art. 1 Legislative Decree no. 164 of 17.09.2007

69 Subsection included by art. 1 Legislative Decree no. 164 of 17.09.2007

70 Subsection included by art. 1 Legislative Decree no. 164 of 17.09.2007

71 Section first introduced by art. 30 of Decree Law no. 179 of 18.10.2012 and subsequently amended by Decree Law no. 3 of 24.1.2015, converted with amendments by Italian Law no. 33 of 24.3.2015, which replaced the words: "portal for the collection of capital for innovative start-ups" with the words "portal for the collection of capital for innovative start-ups and innovative SMEs" and added the following words at the end: ", for innovative SMEs and collective investment bodies or other companies which invest primarily in innovative start-ups or innovative SMEs, as identified by points e) and f) respectively of section 2, article 1 of the Ministry of the Economy and Finance Decree dated 30 January 2014, published in Official Gazette no. 66 of 20 March 2014".

72 Subsection introduced pursuant to art. 30 of Italian Legislative Decree n° 179 of 18.10.2012.

73 Section introduced by Art. 4 of Italian Decree Law no. 3 of 24.1.2015, converted with amendments by Italian Law no. 33 of 24.3.2015.

74 Paragraph amended by art. 1 Legislative Decree no. 164 of 17.9.2007.

75 Paragraph as replaced by art. 1 Legislative Decree no. 164 of 17.09.2007

76 Paragraph added by art. 1 Legislative Decree no. 164 of 17.09.2007

77 Subsection added by Legislative Decree no. 37 of 06.02.2004.

78 Subsection added by Legislative Decree no. 37 of 06.02.2004.

79 Subsection added by Legislative Decree no. 37 of 06.02.2004.

80 Subsection included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

81 Article thus replaced by art. 2 of Italian Legislative Decree no. 130 of 30.7.2012.

82 Subsection thus amended by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015 which replaced: "are published by the Bank of Italy and Consob in their respective Bulletins" with: "are published by the Bank of Italy on its website and by Consob, in electronic format, in its Bulletin".

83 The former wording “Ministry of the Treasury, Budget and Economic Planning” was replaced with the wording “Ministry of the Economy and Finance” by art. 1 of Legislative Decree no. 37 of 6.2.2004.

84 Subsection thus amended first by art. 2 of Italian Legislative Decree no. 130 of 30.7.2012 which replaced the words: "Isvap and the Ufficio Italiano Cambi" with the words: "and Isvap", and then by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the word: "Isvap" with the word: «IVASS». See Bank of Italy-Consob memorandum of understanding of 31.10.2007 (published in Official Gazette no. 270 of 20.11.2007 and Consob Bulletin no. 10.2 of October 2007, attached to the joint Bank of Italy-Consob regulation adopted pursuant to Article 6, subsection 2-bis.

85 Subsection thus replaced by art. 2 of Italian Legislative Decree no. 130 of 30.7.2012.

86 Subsection included by art. 1 Legislative Decree no. 164 of 17.09.2007 and then thus replaced by art. 2 of Italian Legislative Decree no. 130 of 30.7.2012.

87 Subsection included by art. 1 Legislative Decree no. 164 of 17.09.2007

88 Subsection amended by art. 1 Legislative Decree no. 164 of 17.9.2007 which removed the words: “For the same purpose,”.

89 Subsection as amended by Article 3 of Legislative Decree 274/2003 and Article 9 of Law 62/2005 (the 2004 Community Law).

90 Letter thus amended by art. 33 of Law no. 97 of 6.8.2013 which replaced the words: "on settlement" with the words: "on liquidation".

91 Subsection added by Article 3 of Legislative Decree 274/2003 and amended by Article 9 of Law 62/2005 (the 2004 Community Law), which suppressed the words “equivalent to those in force in Italy”.

92 Subsection first amended by art. 9, Law no. 62 of 18.04.2005 (EU Law 2004) and later by art. 1, Legislative Decree no. 229 of 19.11.2007.

93 Paragraph thus replaced by art. 2 of Italian Legislative Decree no. 239 of 30.12.2010.

94 Name as amended by Legislative Decree 37/2004.

95 Article first included by art. 1 of Italian Legislative Decree no. 176 of 5.10.2010 and subsequently replaced by art. 1 of Italian Legislative Decree no. 66 of 7.5.2015.

96 Article introduced pursuant to art. 24 of Italian Legislative Decree n° 179 of 18.10.2012.

97 Article first included by art. 33 of Law no. 97 of 6.8.2013 and subsequently amended by art. 11 of Law no. 161 of 20.10.2014, within the terms specified in the following notes.

98 Subsection added by art. 11 of Law no. 161 of 20.10.2014.

99 Subsection amended by art. 11 of Law no. 161 of 20.10.2014 which has replaced the first sentence.

100 Article included by art. 1 of Italian Legislative Decree no. 44 of 4.3.2014. For the transitory provisions, see art. 15 of Italian Legislative Decree no. 44 of 4.3.2014.

101 Subsection replaced by art. 2 Legislative Decree no. 164 of 17.09.2007

102 Subsection replaced by art. 2 Legislative Decree no. 164 of 17.09.2007

103 Subsection replaced by art. 2 Legislative Decree no. 164 of 17.09.2007

104 Subsection replaced by art. 2 Legislative Decree no. 164 of 17.09.2007

105 Subsection as amended by art. 2 Legislative Decree no. 164 of 17.09.2007. See Bank of Italy-Consob memorandum of understanding of 31.10.2007 (published in Official Gazette no. 270 of 20.11.2007 and Consob Bulletin no. 10.2 of October 2007, attached to the joint Bank of Italy-Consob regulation adopted pursuant to Article 6, subsection 2-bis.

106 Subsection as amended by art. 2 Legislative Decree no. 164 of 17.09.2007. See Bank of Italy-Consob memorandum of understanding of 31.10.2007 (published in Official Gazette no. 270 of 20.11.2007 and Consob Bulletin no. 10.2 of October 2007, attached to the joint Bank of Italy-Consob regulation adopted pursuant to Article 6, subsection 2-bis.

107 Subsection as amended by art. 2 Legislative Decree no. 164 of 17.09.2007. See joint Bank of Italy-Consob Regulation of 29.10.2007 (published in Official Gazette no. 255 of 2.11.2007 and Consob Fortnightly Bulletin no. 10.2, October 2007).

108 Subsection included by art. 2 Legislative Decree no. 164 of 17.09.2007

109 Subsection included by art. 2 Legislative Decree no. 164 of 17.09.2007

110 Paragraph first amended by art. 2 Administrative Order no 297 of 27.12.2006, coordinated by enactment law no. 15 of 23.2.2007 subsequently replaced by Article 2 of Legislative Decree no. 164 of 17.9.2007 and then amended by Article 4 of Legislative Decree no. 72 of 12.5.2015 which added, at the end, the following words: ", and information to be provided to the public on the same matters and on corporate governance, administrative and accounting procedures, internal controls and remuneration and incentive systems". See Bank of Italy Regulation of 24.10.2007 (published in Ordinary Supplement no. 247, Official Gazette no. 277 of 28.11.2007.

111 Letter first replaced by Art. 2 of Italian Legislative Decree no. 164 of 17.09.2007 and subsequently amended by Art. 1 of Italian Legislative Decree no. 47 of 16.04.2012, which replaced the words: “qualified subjects” with the words: “investment brokers, non-EU investment firms, asset management companies and financial intermediaries registered on the list pursuant to Article 107 of the Consolidated Law on Banking, Italian banks and non-EU banks, authorised to provide investment or services”. See Bank of Italy Regulation no. 1097 of 29.10.2007 (published in O.J. no. 255 of 02.11.2007.

112 Letter thus replaced by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014.

113 Subsection included by art. 2 of Administrative Order no. 297 of 27.12.2006, coordinated by enactment law no. 15 of 23.2.2007. See Bank of Italy Regulation of 24.10.2007 (published in Ordinary Supplement no. 247, Official Gazette no. 277 of 28.11.2007).

114 Number included by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014.

115 Section first substituted by art. 2 of Italian Legislative Decree no. 164 of 17.9.2007 and then thus amended by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014. See Consob regulation no. 16190 of 29.10.2007 (published in the Ord. Suppl. no. 222 of the Official Gazette no. 255 of 2.11.2007).

116 Letter thus replaced by art. 22 of Law no. 217 of 15.12.11.

117 Subsection first added by art. 10, Law no. 262 of 28.12.2005 and later replaced by art. 2, Legislative Decree no. 164 of 17.09.2007. See joint Bank of Italy-Consob Regulation of 29.10.2007 (published in Official Gazette no. 255 of 2.11.2007 and Consob Fortnightly Bulletin no. 10.2, October 2007).

118 Subsection included by art. 2 Legislative Decree no. 164 of 17.9.2007.

119 Subsection first introduced by art. 2 of Italian Legislative Decree no. 164 of 17.9.2007, later amended by art. 33 of Italian Law no. 97 of 6.8.2013 which has replaced number 3) and by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014 which has replaced number 1). See Consob regulation no. 16190 of 29.10.2007 (published in the Ord. Suppl. no. 222 of the Official Gazette no. 255 of 2.11.2007). Section 2 of art. 33 of Law no. 97 of 6.8.2013 establishes that: “The provisions on the central counterparty guarantee systems contained in the provision adopted by the Bank of Italy and by Consob on 22 February 2008, bearing "Discipline on the centralised management, liquidation and guarantee services and of the relative management companies", published in the Official Gazette no. 54 of 4 March 2008, continue to apply according to the transitional provisions contemplated by article 89, paragraphs 3 and 4, of Regulation (EU) no. 648/2012 of the European Parliament and of the Council, of 4 July 2012, concerning the OTC derivative instruments, the central counterparties and the data records on the transactions. Non-observance of the provisions on the central counterparty guarantee systems continue to be punished pursuant to article 190 of the Consolidated Law referred to by Legislative Decree no. 58 of 24 February 1998”.

120 Subsection as amended by art. 2 Legislative Decree no. 164 of 17.9.2007. See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

121 Subsection included by art. 2 Legislative Decree no. 164 of 17.9.2007.

122 Subsection included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

123 Subsection included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

124 Subsection included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

125 Letter thus amended by Article 4 of Italian Legislative Decree no. 72 of 12.5.2015 which replaced the words: "the executives" with the words: "the staff".

126 Subsection included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

127 Letter first replaced by Art. 2 of Italian Legislative Decree no. 164 of 17.09.2007 and subsequently amended by Art. 1 of Italian Legislative Decree no. 47 of 16.04.2012, which replaced the words: “qualified subjects” with the words: “investment brokers, non-EU investment firms, asset management companies and financial intermediaries registered on the list pursuant to Article 107 of the Consolidated Law on Banking, Italian banks and non-EU banks, authorised to provide investment or services”. See Bank of Italy Regulation no. 1097 of 29.10.2007 (published in Official Gazette no. 255 of 02.11.2007).

128 Subsection included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

129 Article included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

130 Subsection amended first by Article 2 of Italian Legislative Decree no. 164 of 17.9.2007 which replaced the words: “for the matters of its respective competence” with: “within their respective competences" and then by Article 4 of Italian Legislative Decree no. 72 of 12.5.2015 which added, at the end, the following sentence: "The Bank of Italy and Consob, within their respective competences, may request information from the staff of qualified subjects, including by means of the latter". See Consob resolution no. 17297 of 28.4.2010 (published in Supplement no. 104 to the Official Gazette no. 120 of 25.05.2010 and in Consob Bulletin no. 5.1, May 2010), Bank of Italy Regulation of 24.10.2007 (published in Supplement no. 247 to Official Gazette no. 277 of 28.11.2007) and Bank of Italy/Consob Protocol of Understanding of 31.10.2007 (published in Official Gazette no. 270 of 20.11.2007 and Consob Bulletin no. 10.2, October 2007 as an annex to the joint Bank of Italy/Consob regulation adopted pursuant to Article 6, subsection 2-bis.

131 Section inserted by Art. 22, section 5 of Italian Decree Law no. 91 of 24.6.2014, as amended by conversion law no. 116 of 11.8.2014.

132 Subsection included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

133 Subsection amended by art. 40, Legislative Decree no. 39 of 27/01/2010 which replaced the words: “the appointed independent auditors” with the words: “the appointed statutory auditor”.

134 Subsection first introduced by Italian Legislative Decree no. 37 of 6.2.2004 and subsequently by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014, which replaced the words: "or of the SICAVs" with the words: "of the SICAVs or of the SICAFs".

135 Subsection thus amended first by art. 40 of Italian Legislative Decree no. 39 of 27.1.2010 which replaced the words: "the companies appointed to carry out the audit" with the words: "the subjects appointed to carry out the certified audit of the accounts" and subsequently by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014, which replaced the words: "or of the SICAVs" with the words: "of the SICAVs or of the SICAFs".

136 Subsection first replaced by Legislative Decree no. 37 of 06.02.2004 and later amended by art. 40, Legislative Decree no. 39 of 27.01.2010 which replaced the words: “the appointed independent auditors” with the words: “the appointed statutory auditors”and subsequently by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "or the SICAVs" with the words: ", the SICAVs or the SICAFs". .

137 Subsection included by art. 2 Legislative Decree no. 164 of 17.09.2007

138 Subsection replaced by art. 2 Legislative Decree no. 164 of 17.09.2007

139 Article included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

140 Article included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

141 Article already amended by art. 3 of Italian Legislative Decree no. 303 of 29.12.2006; subsequently replaced by art. 40 of Italian Legislative Decree no. 39 of 27.1.2010 and lastly amended by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014, within the terms specified in the following note.

142 Article first amended by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "and to the SICAVs" with the words: ", to the SICAVs and to the SICAFs".

143 Subsection as amended by art. 2 Legislative Decree no. 164 of 17.9.2007 which replaced the wording: “for matters within the scope of their duties” with the wording “to the extent of their duties”. See Bank of Italy Regulation of 24.10.2007 (published in Ordinary Supplement no. 247, Official Gazette no. 277 of 28.11.2007 and the Bank of Italy-Consob memorandum of understanding of 31.10.2007 (published in Official Gazette no. 270 of 20.11.2007 and in Consob Bulletin no. 10.2 of October 2007, attached to the joint Bank of Italy-Consob regulation adopted pursuant to Article 6, subsection 2-bis.

144 See Bank of Italy Regulation of 24.10.2007 (published in Ordinary Supplement no. 247, Official Gazette no. 277 of 28.11.2007 and the Bank of Italy-Consob memorandum of understanding of 31.10.2007 (published in Official Gazette no. 270 of 20.11.2007 and in Consob Bulletin no. 10.2 of October 2007, attached to the joint Bank of Italy-Consob regulation adopted pursuant to Article 6, subsection 2-bis.

145 Subsection first added by art. 2, Legislative Decree no. 164 of 17.09.2007 and later amended by art. 40, Legislative Decree no. 39 of 27.01.2010 which replaced the words: “the appointed independent auditors” with the words: “the appointed statutory auditor”.

146 Subsection included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

147 Subsection as amended by Article 4 of Legislative Decree 274/2003.

148 Subsection first amended by art. 4 of Italian Legislative Decree no. 274 of 1.8.2003 and subsequently thus amended by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "of harmonised management companies" with the words: "of EU management companies and of EU AIFMs".

149 Subsection amended by art. 2 Legislative Decree no. 164 of 17.9.2007 which replaced the words “for matters within the scope of their duties” with the words: “to the extent of their duties”.

150 See Bank of Italy instructions of 4.8.200, 17.6.2002 and 14.4.2005 (published in Official Gazette no. 218 of 18.9.2000, Official Gazette no. 167 of 18.7.2002 and Ordinary Supplement no. 88, Official Gazette no. 109 of 12.5.2005).

151 Subsection first replaced by art. 2 of D.L. 27.12.2006, no. 297, coordinated with conversion law no. 15 of 23.2.2007 and thus amended by art. 4 of Italian Legislative Decree no. 53 of 4.3.2014 which has introduced letter a-bis) and into letter b), after the words: "letter b)" has introduced the words: "and letter b-bis)". See Bank of Italy regulation of 24.10.2007 (published in the Ordinary Section no. 247 of the Official Journal no. 277 of 28.11.2007).

152 Subsection added by art. 2 of Administrative Order no. 297 of 27.12.2006, coordinated by enactment law no. 15 of 23.2.2007. See Bank of Italy Regulation of 24.10.2007 (published in Ordinary Supplement no. 247, Official Gazette no. 277 of 28.11.2007).

153 Subsection first replaced by art. 2 Administrative order no. 297 of 27.12.2006, coordinated by enactment law no. 15 of 23.2.2007, and later amended by art. 2 Legislative Decree no. 164 of 17.9.2007 which replaced the words: “and 1-bis.” with the words: “1-bis and 2-bis, paragraphs a), b), c) and g).”.

154 Subsection included by art. 2 of Administrative Order no. 297 of 27.12.2006, coordinated by enactment law no. 15 of 23.2.2007. See Bank of Italy Regulation of 24.10.2007 (published in Ordinary Supplement no. 247, Official Gazette no. 277 of 28.11.2007).

155 Subsection included by art. 2 of Administrative Order no. 297 of 27.12.2006, coordinated by enactment law no. 15 of 23.2.2007. See Bank of Italy Regulation of 24.10.2007 (published in Ordinary Supplement no. 247, Official Gazette no. 277 of 28.11.2007)

156 Subsection first replaced by art. 2, Decree Law no. 297 of 27.12.2006, coordinated by conversion law no. 15 of 23.2.2007, and later amended by art. 2, Legislative Decree no. 164 of 17.09.2007 which replaced the words: “on matters pertaining to their respective duties” with the words: “to the extent of their duties”. See Bank of Italy Regulation of 24.10.2007 (published in Ordinary Supplement no. 247, Official Gazette no. 277 of 28.11.2007).

157 Subsection included by art. 2 of Administrative Order no. 297 of 27.12.2006, coordinated by enactment law no. 15 of 23.2.2007. See Bank of Italy Regulation of 24.10.2007 (published in Ordinary Supplement no. 247, Official Gazette no. 277 of 28.11.2007).

158 Subsection repealed by art. 40, Legislative Decree no. 39 of 27.01.2010.

159 Subsection already replaced by Article 2 of Italian Legislative Decree no. 297 of 27.12.2006, coordinated with Conversion Law no. 15 of 23.2.2007; subsequently amended first by Article 2 of Italian Legislative Decree no. 164 of 17.9.2007, which replaced the words: “for the matters of its respective competence” with: “within their respective competences" and finally by Article 4 of Italian Legislative Decree no. 72 of 12.5.2015 which added letter b-bis). See Bank of Italy Regulation of 24.10.2007 (published in Ordinary Supplement no. 247, Official Gazette no. 277 of 28.11.2007).

160 Subsection added by art. 2 of Administrative Order no. 297 of 27.12.2006, coordinated by enactment law no. 15 of 23.2.2007.

161 Subsection included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

162 Subsection included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

163 Subsection included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

164 Subsection included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015

165 Article first amended by Italian Legislative Decree no. 37 of 6.2.2004 and Article 2 of Law no. 44 of 4.3.2014 and then replaced by Article 4 of Italian Legislative Decree no. 72 of 12.5.2015. Subsection 5 of Article 6 of Legislative Decree no. 72 of 12.5.2015 provides that the provisions set forth in Article 13 of Legislative Decree no. 58 of 24 February 1998, as amended by this Legislative Decree, apply to appointments after the date of its entry into force. Until then, Article 13 of Legislative Decree no. 58 of 24 February 1998, continues to apply in the version before amendment by this Legislative Decree, and the related implementing regulations, which is shown below: “Article 13 (Requirements of professionalism, integrity and independence of corporate representatives) 1. Persons who perform administrative, managerial or control functions at SIMs, asset management companies, SICAVs and SICAFs must meet the requirements of professionalism, integrity and independence established by the Minister of Economy and Finance, with a regulation adopted after consulting the Bank of Italy and Consob. 2. The lack of the requirements shall result in disqualification from office. It is declared by the board of directors, the supervisory board or the management board within thirty days of the appointment or knowledge of the supervening defect. 3. In the case of lack of action, the disqualification pronounced by the Bank of Italy or Consob. 3-bis. In case of lack of the requirements of independence established by the Italian Civil Code or the Articles of Association, subsections 2 and 3 shall apply. 4. The regulation required by subsection 1 shall establish the grounds for the temporary suspension from office and its duration. The suspension is declared in the manner set forth in subsections 2 and 3”. Subsection 7 of Article 6 of Legislative Decree no. 72 of 12.05.2015 provides that: “For the purposes of applying Legislative Decree no. 159 of 6 September 2011, the anti-mafia communication is acquired, including by sampling, from the persons referred to in Articles 13 and 14 of Legislative Decree no. 58 of 24 February 1998. The Bank of Italy and Consob have direct access to the Judicial Records System and the Single National Database of Anti-Mafia documentation”.

166 Article first amended by Italian Legislative Decree no. 37 of 6.2.2004, subsequently amended by Article 2 of Law no. 21 of 27.1.2010 and, finally, replaced by Article 4 of Italian Legislative Decree no. 72 of 12.5.2015. Subsection 6 of Article 6 of Legislative Decree no. 72 of 12.5.2015 provides that until the entry into force of the implementing provisions issued pursuant to Article 14 of Legislative Decree no. 58 of 24 February 1998, as amended by this Legislative Decree, the version preceding the amendments made by this Legislative Decree, and related implementing provisions, which are shown below, shall continue to apply: “Article. 14 (Requirements of integrity) 1. The Minister of Economy and Finance, with regulation adopted after consulting the Bank of Italy and Consob, shall establish the integrity requirements of the holders of the shareholdings referred to in Article 15, subsection 1, in SIMs and asset management companies, as well as shareholders of SICAVs and SICAFs. 2. For the purposes of the application of this Article and Article 15, for SICAVs and SICAFs, reference is made only to nominative shares and the provisions referred to in subsection 1 lay down the cases in which, for the purpose of conferring the right to vote, such shares are regarded as bearer shares, with regard to the date of purchase. 3. For the purposes of subsection 1, shares held through subsidiaries, trust companies or third parties are also considered, as well as cases in which the rights arising from shares belong or are assigned to a person other than the owner of the holdings themselves or agreements exist concerning the exercise of voting rights. 4. In the absence of the requirements, the voting rights and other rights that allow influencing the company, inherent in holdings exceeding the thresholds specified by Article 15, subsection 1, may not be exercised. 5. In case of non-compliance with the prohibition, the resolution or other measure adopted by the vote or, in any case, the contribution of the shareholdings referred to in subsection 1, may be challenged under the provisions of the Italian Civil Code. The shares for which the right to vote cannot be exercise are counted for the purposes of the regular constitution of the related shareholders' meeting. 6. The challenge may also be initiated by the Bank of Italy or Consob within one hundred and eighty days of the date of the resolution or, if this is subject to registration in the companies register, within one hundred eighty days of registration or, if it is subject only to filing at the companies register office, within one hundred and eighty days of the date of this. 7. Shareholdings exceeding the thresholds provided for in Article 15, subsection 1, of persons without the requirements of integrity must be sold within the deadline set by the Bank of Italy or Consob”. Subsection 7 of Article 6 of Legislative Decree no. 72 of 12.05.2015 provides that: “For the purposes of applying Legislative Decree no. 159 of 6 September 2011, the anti-mafia communication is acquired, including by sampling, from the persons referred to in Articles 13 and 14 of Legislative Decree no. 58 of 24 February 1998. The Bank of Italy and Consob have direct access to the Judicial Records System and the Single National Database of Anti-Mafia documentation”

167 List first replaced by Article 2 of Legislative Decree no. 21 of 27.1.2010 and then by Article 4 of Legislative Decree no. 72 of 12.5.2015.

168 Subsection first replaced by Italian Legislative Decree no. 37 of 6.2.2004 and by art. 2 of Italian Legislative Decree no. 21 of 27.1.2010 and subsequently thus amended by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014 which after the word: "SICAVs" has introduced the words: "or SICAFs".

169 Subsection first amended by Article 2 of Legislative Decree no. 21 of 27.1.2010 and then replaced by Article 4 of Legislative Decree no. 72 of 12.5.2015.

170 Subsection amended by art. 2, Legislative Decree no. 21 of 27.01.2010 which deleted the second sentence.

171 Subsection first replaced by Legislative Decree no. 37 of 6.02.2004 and later amended by art. 2, Legislative Decree no. 21 of 27.01.2010 which replaced paragraph a) and added the following words to paragraph c): “, and for completion of the assessment procedures envisaged in subsection 2”. See Bank of Italy instructions of 4.8.200, 17.6.2002 and 14.4.2005 (published in Official Gazette no. 218 of 18.9.2000, Official Gazette no. 167 of 18.7.2002 and Ordinary Supplement no. 88, Official Gazette no. 109 of 12.5.2005).

172 Title as amended by Legislative Decree 37/2004.

173 Subsection as amended by Legislative Decree 37/2004.

174 Subsection first amended by Italian Legislative Decree no. 37 of 6.2.2004 and subsequently thus amended by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words "or in SICAV" with the words: ", in a SICAV or in a SICAF".

175 Subsection added by Legislative Decree 37/2004.

176 Article first replaced by Italian Legislative Decree no. 37 of 6.2.2004 and subsequently amended by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014 in the terms indicated in the following notes.

177 Letter thus amended by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "and to the SICAVs" with the words: ", to the SICAVs and to the SICAFs".

178 Article as amended by Legislative Decree 37/2004.

179 Title as amended by Article 3 of Legislative Decree 164/2007.

180 Subsection amended by Article 3 of Legislative Decree 164/2007.

181 Subsection first replaced by art. 5 of Italian Legislative Decree no. 274 of 1.8.2003, subsequently by art. 3 of Italian Legislative Decree no. 164 of 17.9.2007 and lastly by art. 2 of Italian Legislative Decree no. 44 of 4.3.2014. For the transitory provisions, see art. 15 of Italian Legislative Decree no. 44 of 4.3.2014.

182 Subsection as substituted by Article 3 of Legislative Decree 164/2007.

183 Subsection included by art. 3 Legislative Decree no. 164 of 17.09.2007

184 The previous wording : “Minister of the Treasury, Budget and Economic Planning” was replaced by the wording: “Minister of the Economy and Finance” by Article 1 of Legislative Decree 37/2004.

185 See Ministry of the Economy and Finance decree no. 44 of 2.3.2007 (published in Official Gazette no. 81 of 6.4.2007).

186 Paragraph as replaced by art. 3 Legislative Decree no. 164 of 17.09.2007

187 Pending issue of the enactment regulations for this subsection, Treasury decree no. 329 of 26.6.1997 (published in Official Gazette no. 228 of 30.9.1997).

188 Article first introduced by Article 3 of Italian Legislative Decree no. 164 of 17.9.2007, successively replaced by Article 1 of Italian Legislative Decree no. 101 of 17.7.2009 and lastly amended by Italian Law no. 208 of 28.12.205 in the terms indicated in the following notes. Pursuant to the provisions of Article 19, section 14, of Italian Legislative Decree no. 164 of 17.9.2007 (final and transitory provisions), first amended by Article 1 of Italian Decree Law no. 113 of 30.6.2008 and subsequently by section 16-bis of Article 41 of Italian Decree Law no. 207 of 30 December 2008, added by the relative law of conversion no. 14 of 27 February 2009, until 31 December 2016 (term modified most recently by Article 10, section 4 of Italian Decree Law no. 210 of del 30.12.2015 and previously by Article 21-bis of Italian Decree Law no. 91 of 24.6.2014, as amended by conversion law no. 116 of 11.8.2014; by Article 9, section 1 of Italian Decree Law no. 150 of 30.12.2013, converted with amendments by Italian Law no. 15 of 27.2.2014; by Article 1, section 388 of Italian law no. 228 of 24.12.2012, by Article 23 of Italian law no. 14 of 24.2.2012, of conversion of Italian Decree Law no. 216 of 29.12.2011; and by Article 1, section 14, of Italian Decree Law no. 194 of 30.12.2009) the restriction of the activity referred to by Article 18 does not prejudice the possibility for subjects who, at 31 October 2007, give advice on investments, to continue to perform the service referred to under Article 1, section 5, letter f), without holding sums of money or financial instruments belonging to the customers. Section 4-ter of Article 17 of Italian Legislative Decree no. 141 of 13.8.2010 introduced by Article 10 of Italian Legislative Decree no. 169 of 19.9.2012 rules that”: “4-ter. The agency activity in financial activities is not compatible with (…) with the activity of financial advisor referred to by Article 18-bis of Italian legislative decree no. 58 of 24 February 1998, nor with that of financial advisory companies referred to by Article 18-ter of the aforesaid legislative decree”. Section 1-bis of Italian Legislative Decree no. 141 of 13.8.2010 introduced by Article 7 of Italian Legislative Decree no. 169 of 19.9.2012 rules that: “1-bis the promotion and placing of contracts relative to the granting of loans or the performance of payment services on the part of financial advisors listed on the register contemplated by Article 31 of Italian Legislative Decree no. 58 of 24 February 1998, carried out on behalf of the authorised subject which has conferred on them the mandate of financial advisor, do not represent the practice of agency activities, provided the loans or the payment services are for the purpose of allowing investors to carry out transactions relative to financial instruments. (…)”.

189 Heading thus amended by Article 1, section 39 of Law no. 208 of of 28.12.205 which replaced the words: "financial advisors" with the words: "independent financial advisors".

190 Article 1, section 37, of Italian Law no. 208 of 28.12.205 provides that: “the sole register of financial advisors referred to by Article 31, section 4, of Italian Legislative Decree no. 58 of 1998 takes on the name of "sole register of financial advisors". The register contains three separate sections, for financial advisors authorised to make off-premises offers, independent financial advisors, and financial consultancy companies. The references to the financial advisors' register, contained in Articles 18-bis, section 1, and 18-ter, section 3, of Italian Legislative Decree no. 58 of 1998 are understood as replaced by references to the sole register as mentioned in the first sentence of this section".

191 Section abrogated by Article 1, section 36, of Italian Law no. 208 of 28.12.205.

192 Section abrogated by Article 1, section 36, of Italian Law no. 208 of 28.12.205.

193 Section abrogated by Article 1, section 36, of Italian Law no. 208 of 28.12.205.

194 Section abrogated by Article 1, section 36, of Italian Law no. 208 of 28.12.205.

195 Article 1, section 36, of Italian Law no. 208 of 28.12.2015 no. 208 has provided that the references to the body which holds the register of financial advisors and to CONSOB, contained in Articles 18-bis, section 6, 31, section 7, 55 and 196, section 2, of Italian Legislative Decree no. 58 of 1998, are understood as replaced by references to the supervisory body which holds the sole register of financial advisors referred to by Article 31, section 4, of the aforesaid Legislative Decree. The said body operates in respect of the principles and criteria established by CONSOB with its own regulation and under the supervision of the same. Section 41 of Italian Law no. 208 of 28.12.2015 provides that: “within six months from the adoption of the regulation referred to by section 36, CONSOB and the body which holds the sole register of financial advisors must establish with a memorandum of understanding the operating procedures and the timing for the transfer of the functions, the procedures necessary for implementation of the new statutory and organisational system, and the preparatory activities connected with the registration with exoneration from the assessment test of natural persons who are independent financial advisors and of financial consultancy companies. The subjects enrolled at the date indicated under letter a) of this section, on the sole register of financial advisors held by the body referred to under Article 31, section 4, of Italian Legislative Decree no. 58 of 1998 are enrolled by rights on the sole register of financial advisors. With successive resolutions to be adopted, also separately, in compliance with the aforesaid regulation referred to under section 36 and in the memorandum of understanding mentioned in the first sentence of this section, CONSOB establishes: a) the starting date of the effectiveness of the sole register of financial advisors; b) the starting date of the effectiveness of the supervisory body which holds the sole register of financial advisors.

196 See Consob Regulation no. 17130 of 12.1.2010.

197 Article included by art. 2 Law no. 69 of 18.6.2009. Article 1, section 37, of Italian Law no. 208 of 28.12.205 provides that: “the sole register of financial advisors referred to by Article 31, section 4, of Italian Legislative Decree no. 58 of 1998 takes on the name of "sole register of financial advisors". The register contains three separate sections, for financial advisors authorised to make off-premises offers, independent financial advisors, and financial consultancy companies. The references to the financial advisors' register, contained in Articles 18-bis, section 1, and 18-ter, section 3, of Italian Legislative Decree no. 58 of 1998 are understood as replaced by references to the sole register as mentioned in the first sentence of this section".Subsection 4-ter of art. 17 of Italian Legislative Decree no. 141 of 13.8.2010 introduced by art. 10 of Italian Legislative Decree no. 169 of 19.9.2012 rules that: “4-ter. The activity of an agency practising financial activity is not compatible with (…)the activity of financial consultant contemplated by article 18-bis of Italian Legislative Decree no. 58 of 24 February 1998, nor with that of a financial consultancy company as contemplated by article 18-ter of the aforesaid Legislative Decree”.

198 Indent replaced by art. 3 Legislative Decree no. 164 of 17.9.2007.

199 See Bank of Italy Regulation no. 1097 of 29.10.2007 (published in Official Gazette no. 255 of 2.11.2007).

200 Subsection replaced by art. 3 Legislative Decree no. 164 of 17.09.2007

201 Letter first replaced by Legislative Decree no. 37 of 6.02.2004 and then by Article 4 of Legislative Decree no. 72 of 12.5.2015.

202 Letter first replaced by Legislative Decree no. 37 of 6.2.2004, then by Article 2 of Legislative Decree no. 21 of 27.1.2010 and finally by Article 4 of Legislative Decree no. 72 of 12.5.2015.

203 Subsection amended by Article 3 of Italian Legislative Decree no. 164 of 17.9.2007

204 Subsection amended by art. 3 Legislative Decree no. 164 of 17.9.2007. See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

205 Subsection included by art. 3 Legislative Decree no. 164 of 17.09.2007

206 Subsection replaced by art. 3 Legislative Decree no. 164 of 17.09.2007

207 See Consob resolutions no. 11760 of 22.12.1998 and no. 16216 of 13.11.2007.

208 Heading amended by art. 4 Legislative Decree no. 164 of 17.9.2007.

209 Subsection first amended by art. 14 Law no. 262 of 28.12.2005 and by art. 10, subsection 6 of Law no. 13 of 6.2.2007 (2006 Community Law) and later replaced by art. 4 Legislative Decree no. 164 of 17.9.2007.

210 Subsection included by art. 4 Legislative Decree no. 164 of 17.09.2007

211 Subsection first replaced by art. 6 of Italian Legislative Decree no. 274 of 1.8.2003 and subsequently thus amended by art. 3 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "harmonised management company" with the words: "EU management company". Subsection as amended by Article 6 of Legislative Decree 274/2003.

212 Subsection as amended by Article 6 of Legislative Decree 274/2003 and subsequently thus amended by art. 3 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "harmonised management company" with the words: "EU management company.

213 Subsection thus amended by art. 4 of Italian Legislative Decree no. 164 of 17.9.2007 which replaced the words "investment and non-core services" with the words: "investment and non-core services, except for the service set forth in article 1, subsection 5, paragraph f), and, if foreseen, the provision of accessory services" and eliminated the word "technical". See Consob regulation no. 16190 of 29.10.2007 (published in the Ordinary Supplement no. 222 of the Official Gazette no. 255 of 2.11.2007).

214 Subsection first amended by art. 3 Legislative Decree no. 303 of 29.12.2006 and later by art. 4 Legislative Decree no. 164 of 17.9.2007 which added the words: “and activities” and suppressed the words: “or the accessory services pursuant to article 1, subsection 6, paragraph f)”.

215 Subsection amended by art. 4 Legislative Decree no. 164 of 17.9.2007.

216 Heading amended by art. 4 Legislative Decree no. 164 of 17.9.2007 which removed the words “investment”.

217 Subsection replaced by art. 11 Legislative Decree no. 164 of 17.09.2007. See Ministry of the Treasury, Budget and Economic Planning decree no. 470 of 11.11.1998 (published in Official Gazette no. 7 of 11.1.1999).

218 Article first amended by art. 10, subsection 3 of Law no. 13 of 06.02.2007 (2006 Community Law) and later replaced by art. 4, Legislative Decree no. 164 of 17.09.2007.

219 Article first replaced by art. 11, Law no. 262 of 28.12.2005 and later amended by art. 3, Legislative Decree no. 303 of 29.12.2006, by art. 4, Legislative Decree no. 164 of 17.09.2007, art. 40, Legislative Decree no. 39 of 27.1.2010 and Article 4 of Legislative Decree no. 72 of 12.5.2015 as indicated in the following footnotes.

220 The previous wording: “and, insofar as they are compatible,” was replaced by the wording: “and” by Art. 3 of Legislative Decree No. 303 of 29.12.2006.

221 Subsection amended by art. 4 Legislative Decree no. 164 of 17.9.2007. See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

222 Subsection amended by art. 40, Legislative Decree no. 39 of 27.01.2010 which replaced the words: “the appointed independent auditors” with the words: “the appointed statutory auditors”.

223 Subsection amended by art. 40, Legislative Decree no. 39 of 27.01.2010 which replaced the words: “the appointed independent auditors” with the words: “the appointed statutory auditors”.

224 Subsection thus amended by Article 4 of Italian Legislative Decree no. 72 of 12.5.2015 which replaced: "ISVAP" with: "IVASS".

225 See Bank of Italy Regulation no. 1097 of 29.10.2007 (published in Official Gazette no. 255 of 2.11.2007).

226 Subsection amended by art. 5 Legislative Decree no. 164 of 17.9.2007 which removed the words “to the Bank of Italy and”.

227 Subsection amended by art. 5 Legislative Decree no. 164 of 17.9.2007 which removed the words “to the Bank of Italy and” and replaced the words: “have been informed” with the words: “has been informed”.

228 Subsection amended by art. 5 Legislative Decree no. 164 of 17.9.2007. See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

229 See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

230 Subsection amended by art. 5 Legislative Decree no. 164 of 17.9.2007.

231 Subsection amended by art. 5 Legislative Decree no. 164 of 17.9.2007.

232 Heading amended by art. 5 Legislative Decree no. 164 of 17.9.2007. See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

233 Subsection as replaced by art. 5, Legislative Decree no. 164 of 17.09.2007.

234 Paragraph amended by art. 6 Legislative Decree no. 164 of 17.9.2007.

235 Paragraph replaced first by art. 6 if Italian Legislative Decree no. 164 of 17.9.2007 and successively by art. 1 of Italian Legislative Decree no. 184 of 11.10.2012. See Consob regulation no. 16190 of 29.10.2007 (published in the Ordinary Supplement no. 222 of the Official Journal no. 255 of 2.11.2007).

236 Heading amended by art. 6 Legislative Decree no. 164 of 17.9.2007.

237 Letter first replaced by art. 7 of Italian Legislative Decree no. 274 of 1.8.2003 and subsequently by art. 3 of Italian Legislative Decree no. 44 of 4.3.2014.

238 Subsection first replaced by art. 7 of Italian Legislative Decree no. 274 of 1.8.2003 and subsequently by art. 6 of Italian Legislative Decree no. 164 of 17.9.2007 and lastly thus amended by art. 3 of Italian Legislative Decree no. 44 of 4.3.2014 which has replaced the words: "harmonised management companies" with the words: "EU management companies and EU and non-EU AIFMs".

239 Subsection amended by art. 5 Legislative Decree no. 164 of 17.9.2007. See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

240 Subsection first amended by art. 6 of Legislative Decree no. 164 of 17.9.2007 has suppressed the words: “or placed by remote means pursuant to article 32” and the words: “or by remote means pursuant to article 32 and then by Legislative Decree no. 69 of 21.6.2013, converted with amendments by Law no. 98 of 9.8.2013 which has inserted the third sentence and lastly by Article 1, section 39 of Italian Law no. 208 of 28.12.2015 which has replaced the words: "financial advisors" with the words: "financial advisors authorised to make off-premises offers".

241 Subsection replaced first of all by Art.11 of I No. 262 of 28.12.2005 and then amended by Art. 3 of Legislative Decree No. 303 of 29.12.2006 which replaced the wording: “and from financial products issued by insurance companies, withstanding the obligation to deliver the prospectus” with the words: ”and, restricted to qualified people, to financial products issued by insurance companies”. Art. 8, subsection 4 Legislative Decree no. 303/2006 states: “In exception to the amendments to article 3 subsection 5, article 30 of Legislative Decree no. 58 of 24 February 1998 shall apply to financial products issued by insurance companies as from 1 July 2007”.

242 Heading thus amended by Article 1, section 39 of Italian Law no. 208 of 28.12.2015 which replaced the words: "financial advisors" with the words: "financial advisors authorised to make off-premises offers».

243 Subsection first replaced by art. 6 of Italian Legislative Decree no. 164 of 17.9.2007 and subsequently by art. 3 of Italian Legislative Decree no. 44 of 4.3.2014 and lastly by Article 1, section 39, of Law no. 208 of 28.12.2015 which has replaced the words: "financial advisors" with the words: "financial advisors authorised to make off-premises offers". Paragraph 4-bis of art. 17 of Italian Legislative Decree no. 141 of 13.8.2010 introduced by art. 10 of Italian Legislative Decree no. 169 of 19.9.2012 rules that: "4-bis. The activity of an agency engaged in financial activities is compatible with the activity of (…) financial sales person, without prejudice to what is established by article 12, subsection 1-bis (…)". Subsection 4-quinquies of art. 17 of Italian Legislative Decree no. 141 of 13.8.2010 introduced by art. 10 if Italian Legislative Decree no. 169 of 19.9.2012 rules that: "4-quinquies. The activity of credit mediation is not compatible with (...) the activity of financial sales person as contemplate by Italian Legislative Decree no. 58 of 24 February 1998".

244 Subsection replaced by art. 6 Legislative Decree no. 164 of 17.09.2007 and subsequently thus amended by Article 1, section 39, of Italian Law no. 208 of 28.12.2015 which replaced the words: "financial advisors" with the words: "financial advisors authorised to make off-premises offers".

245 Section thus amended by Article 1, section 39 of Italian Law no. 208 of 28.12.2015 which replaced the words: "financial advisors" with the words: "financial advisors authorised to make off-premises offers".

246 Article 1, section 36 of Italian Law no. 208 of 28.12.205 has provided that "The functions of supervising financial advisors attributed to CONSOB by the consolidated law on financial intermediation, pursuant to Italian Legislative Decree no. 58 of 24 February 1998 [...] have been transferred to the body referred to under Article 31, section 4, of the aforesaid Legislative Decree, which assumes the functions of the body referred to by Articles 18-bis, section 6, and 18-ter, section 3, of the same Legislative Decree, and the name of "supervisory body which holds the sole register of financial advisors"

247 Subsection first replaced by art. 14, Law no. 262 of 28.12.2005 and later replaced by art. 1, subsection 2, Legislative Decree no. 101 of 17.7.2009 and lastly thus amended by Article 1, section 37 of Italian Law no. 208 of 28.12.2015 which has provided that: “The sole register of financial advisors referred to by Article 31, section 4, of Italian Legislative Decree no. 58 of 1998 takes on the name of "sole register of financial advisors". The register contains three separate sections, for financial advisors authorised to make off-premises offers, independent financial advisors, and financial consultancy companies. The references to the financial advisors' register, contained in Articles 18-bis, section 1, and 18-ter, section 3, of Italian Legislative Decree no. 58 of 1998 are understood as replaced by references to the sole register as mentioned in the first sentence of this section".

248 The former wording “Minister of the Treasury, Budget and Economic Planning” was replaced with the wording “Minister of the Economy and Finance” by art. 1 of Legislative Decree no. 37 of 6.2.2004.

249 See Decree 472/1998 issued by the Minister of the Treasury, the Budget and Economic Planning (published in Official Gazette no. 7 of 11.11.1999). The words “held by Consob” were deleted by Article 14 of Law 262/2005.

250 Subsection as amended by Article 14 of Law 262/2005 and subsequently thus amended by Article 1, section 39, of Italian Law no. 208 of 28.12.2015 which replaced the words: "financial advisors" with the words: "financial advisors authorised to make off-premises offers". See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

251  Article 1, section 36, of Italian Law no. 208 of 28.12.2015 no. 208 has provided that the references to the body which holds the register of financial advisors and to CONSOB, contained in Articles 18-bis, section 6, 31, section 7, 55 and 196, section 2, of Italian Legislative Decree no. 58 of 1998, are understood as replaced by references to the supervisory body which holds the sole register of financial advisors  as per Article 31, section 4, of the aforesaid Legislative Decree.  The said body operates in respect of the principles and criteria established by CONSOB with its own regulation and under the supervision of the same. Section 41 of Italian Law no. 208 of 28.12.2015 provides that: “within six months from the adoption of the regulation referred to by section 36, CONSOB and the body which holds the sole register of financial advisors must establish with a memorandum of understanding the operating procedures and the timing for the transfer of the functions, the procedures necessary for implementation of the new statutory and organisational system, and the preparatory activities connected with the registration with exoneration from the assessment test of natural persons who are independent financial advisors and of financial consultancy companies. The subjects enrolled at the date indicated under letter a) of this section, on the sole register of financial advisors held by the body referred to under Article 31, section 4, of Italian Legislative Decree no. 58 of 1998 are enrolled by rights on the sole register of financial advisors. With successive resolutions to be adopted, also separately, in compliance with the aforesaid regulation referred to under section 36 and in the memorandum of understanding mentioned in the first sentence of this section, CONSOB establishes: a) the starting date of the effectiveness of the sole register of financial advisors; b) the starting date of the effectiveness of the supervisory body which holds the sole register of financial advisors.

252 Section thus amended by Article 1, section 39 of Italian Law no. 208 of 28.12.2015 which replaced the words: "financial advisors" with the words: "financial advisors authorised to make off-premises offers".

253 Heading amended by art. 6 Legislative Decree no. 164 of 17.9.2007.

254 Subsection first amended by art. 3 Legislative Decree no. 303 of 29.12.2006 and later replaced by art. 6 Legislative Decree no. 164 of 17.9.2007. Legislative Decree no. 190 of 19.8.2005 was repealed by art. 21, Legislative Decree no. 221 of 23.10.2007, which included regulations on “distance marketing of financial services to consumers” provided in Legislative Decree no. 206 of 6.9.2005. See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

255 Chapter amended by art. 7 Legislative Decree no. 164 of 17.9.2007.

256 Chapter thus replaced by art. 4 of Italian Legislative Decree no. 44 of 4.3.2014. For the transitory provisions, see art. 15 of Italian Legislative Decree no. 44 of 4.3.2014.

257 Chapter first included by Article 4 of Legislative Decree no. 44 of 4.3.2014 and subsequently amended by Article 4 of Legislative Decree no. 72 of 12.5.2015 within the terms indicated in the notes that follow.

258 Line first amended by art. 8 of Italian Legislative Decree no. 164 of 17.9.2007 which replaced the words: “and the management service on an individual investment portfolio basis” with the words: “, of the portfolio management service and the investment advisory service” and subsequently thus replaced by art. 4 of Italian Legislative Decree no. 44 of 4.3.2014.

259 Letter first replaced by Legislative Decree no. 37 of 6.02.2004 and then by Article 4 of Legislative Decree no. 72 of 12.5.2015.

260 Letter first replaced by Legislative Decree no. 37 of 6.2.2004, then by Article 2 of Legislative Decree no. 21 of 27.1.2010 and finally by Article 4 of Legislative Decree no. 72 of 12.5.2015.

261 Subsection first replaced by art. 9 of Italian Legislative Decree no. 274 of 1.8.2003 and subsequently by art. 4 of Italian Legislative Decree no. 44 of 4.3.2014. See Bank of Italy instruction of 14.04.2005 (published in Ordinary Supplement no. 88, Official Gazette no. 109 of 12.05.2005).

262 Subsection as amended by Article 9 of Legislative Decree 274/2003.

263 Section first included by Article 4 of Italian Legislative Decree no. 44 of 4.3.2014 and subsequently amended by Article 4 of Italian Legislative Decree no. 72 of 12.5.2015, within the terms specified in notes that follow.

264 Letter thus replaced by Article 4 of Italian Legislative Decree no. 72 of 12.5.2015.

265 Letter thus replaced by Article 4 of Italian Legislative Decree no. 72 of 12.5.2015.

266 Section first included by art. 4 of Italian Legislative Decree no. 44 of 4.3.2014 and subsequently amended by art. 1 of Italian Legislative Decree no. 66 of 7.5.2015, within the terms specified in the following note..

267 Article included by art. 1 of Italian Legislative Decree no. 66 of 7.5.2015.

268 Chapter thus replaced by art. 4 of Italian Legislative Decree no. 44 of 4.3.2014 and subsequently amended by Article 4 of Legislative Decree no. 72 of 12.5.2015 within the terms indicated in the notes that follow.

269 Letter thus replaced by Article 4 of Italian Legislative Decree no. 72 of 12.5.2015.

270 Letter thus amended by Article 4 of Italian Legislative Decree no. 72 of 12.5.2015 which after the words: "requisites of integrity", added the words: "and meet the criteria".

271 See Ministry of Economic and Finance decree no. 30 of 5.3.2015 (published in Official Gazette no. 65 of 19.3.2015).

272 Chapter thus replaced by art. 4 of Italian Legislative Decree no. 44 of 4.3.2014.

273 Chapter included by art. 4 of Italian Legislative Decree no. 44 of 4.3.2014.

274 Chapter included by art. 4 of Italian Legislative Decree no. 44 of 4.3.2014.

275 Chapter added by article 17, paragraph 1, of of Italian Decree Law n. 18 of 14.2.2016

276 Chapter thus replaced by art. 4 of Italian Legislative Decree no. 44 of 4.3.2014.

277 Article abrogated by art. 4 of Italian Legislative Decree no. 44 of 4.3.2014.

278 Chapter included by art. 1 of Italian Legislative Decree no. 47 of 16.04.12.

279 Article abrogated by art. 4 of Italian Legislative Decree no. 44 of 4.3.2014.

280 Chapter included by art. 1 of Italian Legislative Decree no. 47 of 16.04.12.

281 Article abrogated by art. 4 of Italian Legislative Decree no. 44 of 4.3.2014,.

282 Article abrogated by art. 4 of Italian Legislative Decree no. 44 of 4.3.2014

283 Chapter first included by Art. 30 of Italian Legislative Decree no. 179 of 18.10.2012 and subsequently amended by Art. 4 of Italian Legislative Decree no. 3 of 24.1.2015, within the terms specified in the following notes, converted with amendments by Italian Law no. 33 of 24.3.2015,.which after the words: "innovative start-ups", has introduced the words: “and innovative SMEs”.

284 List thus amended by Art. 4 of Italian Decree Law no. 3 of 24.1.2015 converted with amendments by Italian Law no. 33 of 24.3.2015 which after the words: "innovative start-ups", has introduced the words: “and innovative SMEs”.

285 List thus amended by Art. 4 of Italian Decree Law no. 3 of 24.1.2015 converted with amendments by Italian Law no. 33 of 24.3.2015 which after the words: "innovative start-ups", has introduced the words: “and innovative SMEs”.

286 Section thus amended by Art. 4 of Italian Decree Law no. 3 of 24.1.2015, converted with amendments by Italian Law no. 33 of 24.3.2015 which after the words: "innovative start-ups", has introduced the words: “, for innovative SMEs, for collective investment bodies and for companies which invest prevalently in innovative start-ups and in innovative SMEs”.

287 Section thus amended by Art. 4 of Italian Decree Law no. 3 of 24.1.2015 converted with amendments by Italian Law no. 33 of 24.3.2015which after the words: "innovative start-ups", has introduced the words: “, for innovative SMEs, for collective investment bodies and for companies which invest prevalently in innovative start-ups and in innovative SMEs”.

288 Article introduced pursuant to art. 30 of Italian Legislative Decree n° 179 of 18.10.2012.

289 Subsection thus amended first by art. 9 of Italian Legislative Decree no. 164 of 17.9.2007 which introduced the words: "and activities" and replaced the words: “each for the matters of its own competence” with the words: “within the scope of their respective competence” and subsequently by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014 which after the words: "of SICAVs" introduced the words: ", of SICAFs, non-EU AIFMs authorised in Italy".

290 Indent amended by art. 9 Legislative Decree no. 164 of 17.9.2007 which replaced the word: “regarding” with the words: “, and impose any other limitation with regard to each type of transaction,”.

291 Subsection already substituted by art. 21 of Italian Legislative Decree no. 274 of 1.8.2003; by art. 9 of Italian Legislative Decree no. 164 of 17.9.2007; amended by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 which replaced the words: “pursuant to this decree” with the words: "according to Italian law" and lastly thus amended by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "of harmonised management companies" with the words: "of EU management companies and EU and non-EU AIFMs authorised in an EU State other than Italy".

292 Indent substituted by Article 9 of Legislative Decree no. 164 of 17.9.2007.

293 Subsection first introduced by art. 9 of Italian Legislative Decree no. 164 of 17.9.2007 and subsequently thus amended by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "Community provisions" with the words: "European Union provisions".

294 Subsection first introduced by art. 9 of Italian Legislative Decree no. 164 of 17.9.2007 and then amended by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 which introduced the words: “or harmonised management companies” and then by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "harmonised management companies" with the words: "EU management companies and EU and non-EU AIFMs authorised in an EU State other than Italy" and the words: "Community provisions" with the words: "European Union provisions".

295 Subsection added by Article 4 of Italian Legislative Decree no. 72 of 12.5.2015.

296 See Consob Resolutions 10579/1997 and 12378/2000.

297 See Consob resolutions no. 12378 of 16.2.2000 and no. 14064 of 6.5.2003.

298 List first replaced by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 and then by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014.

299 Subsection first amended first by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 which replaced the words: “foreign” with the words: "Community and non-Community" and then by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "of Community and non-Community UCIs" with the words: of EU UCITS and EU and non-EU AIFs.

300 Subsection first introduced by art. 1 of Italian Legislative Decree no. 47 of 16.4.2012 and subsequently thus amended by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "a harmonised Community UCI" with the words: "an EU UCITS and an EU and non- EU AIF"; and the words: "Community provisions" with the words: "European Union provisions".

301 Section thus amended by Article 1, section 39 of Italian Law no. 208 of 28.12.2015 which replaced the words: "financial advisors" with the words: "financial advisors authorised to make off-premises offers".

302 Article 1, section 36, of Italian Law no. 208 of 28.12.2015 no. 208 has provided that the references to the body which holds the register of financial advisors and to CONSOB, contained in Articles 18-bis, section 6, 31, section 7, 55 and 196, section 2, of Italian Legislative Decree no. 58 of 1998, are understood as replaced by references to the supervisory body which holds the sole register of financial advisors referred to by Article 31, section 4, of the aforesaid Legislative Decree. The said body operates in respect of the principles and criteria established by CONSOB with its own regulation and under the supervision of the same. Section 41 of Italian Law no. 208 of 28.12.2015 provides that: “within six months from the adoption of the regulation referred to by section 36, CONSOB and the body which holds the sole register of financial advisors must establish with a memorandum of understanding the operating procedures and the timing for the transfer of the functions, the procedures necessary for implementation of the new statutory and organisational system, and the preparatory activities connected with the registration with exoneration from the assessment test of natural persons who are independent financial advisors and of financial consultancy companies. The subjects enrolled at the date indicated under letter a) of this section, on the sole register of financial advisors held by the body referred to under Article 31, section 4, of Italian Legislative Decree no. 58 of 1998 are enrolled by rights on the sole register of financial advisors. With successive resolutions to be adopted, also separately, in compliance with the aforesaid regulation referred to under section 36 and in the memorandum of understanding mentioned in the first sentence of this section, CONSOB establishes: a) the starting date of the effectiveness of the sole register of financial advisors; b) the starting date of the effectiveness of the supervisory body which holds the sole register of financial advisors.

303 Section thus amended by Article 1, section 39 of Italian Law no. 208 of 28.12.2015 which replaced the words: "financial advisors" with the words: "financial advisors authorised to make off-premises offers".

304 Article 1, section 36, of Italian Law no. 208 of 28.12.2015 no. 208 has provided that the references to the body which holds the register of financial advisors and to CONSOB, contained in Articles 18-bis, section 6, 31, section 7, 55 and 196, section 2, of Italian Legislative Decree no. 58 of 1998, are understood as replaced by references to the supervisory body which holds the sole register of financial advisors referred to by Article 31, section 4, of the aforesaid Legislative Decree. The said body operates in respect of the principles and criteria established by CONSOB with its own regulation and under the supervision of the same. Section 41 of Italian Law no. 208 of 28.12.2015 provides that: “within six months from the adoption of the regulation referred to by section 36, CONSOB and the body which holds the sole register of financial advisors must establish with a memorandum of understanding the operating procedures and the timing for the transfer of the functions, the procedures necessary for implementation of the new statutory and organisational system, and the preparatory activities connected with the registration with exoneration from the assessment test of natural persons who are independent financial advisors and of financial consultancy companies. The subjects enrolled at the date indicated under letter a) of this section, on the sole register of financial advisors held by the body referred to under Article 31, section 4, of Italian Legislative Decree no. 58 of 1998 are enrolled by rights on the sole register of financial advisors. With successive resolutions to be adopted, also separately, in compliance with the aforesaid regulation referred to under section 36 and in the memorandum of understanding mentioned in the first sentence of this section, CONSOB establishes: a) the starting date of the effectiveness of the sole register of financial advisors; b) the starting date of the effectiveness of the supervisory body which holds the sole register of financial advisors.

305 Section thus amended by Article 1, section 39 of Italian Law no. 208 of 28.12.2015 which replaced the words: "financial advisors" with the words: "financial advisors authorised to make off-premises offers".

306 Chapter added by article 2 of Italian Legislative Decree no. 181 of 16/11/2015.

307 Paragraph first amended by art. 9 of Italian Legislative Decree no. 164 of 17/9/2007 and by art. 5 of Italian Legislative Decree no. 44 of 4/3/2014 and lastly as replaced by art. 2 of Italian Legislative Decree no. 181 of 16/11/2015.

308 Subsection thus amended by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014 which after the words: "non-Community investment companies" introduced the words: "and of non-EU AIFMs authorised in Italy".

309 Paragraph amended first by Article 5 of Italian Legislative Decree no. 44 of 4/3/2014 which replaced the words: "and to the SICAVs" with the words: ", to the SICAVS, to the SICAFS and to the non-EU AIFMs authorised in Italy" and then by art. 2 of Italian Legislative Decree no. 181 of 16/11/2015 which has replaced the words: "articles 70, paragraphs from 2 to 6, 71, 72, 73, 74, 75 of the Consolidated Law on Banking" with the words: "articles 70, paragraphs 2, 3, 4 and 5, 71, 72, 73, 74, 75, 75-bis and 77-bis of the Consolidated Law on Banking".

310 Subsection thus amended by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "and to the SICAVs" with the words: ", to the SICAVs and to the SICAFs".

311 Paragraph added by art. 2 of Italian Legislative Decree no. 181 of 16/11/2015.

312 Article included by Article 4 of Italian Legislative Decree no. 72 of 12.05.2015.

313 The preceding words: "Ministry of the Treasury, Budget and Economic Planning" was replaced by the words: "Ministry of Economy and Finance" by art. 1 of Legislative Decree.  N. 37 of 6.2.2004.

314 Paragraph amended first by Article 9 of Italian Legislative Decree no. 164 of 17/9/2007 which replaced the words: “each for the matters of its own competence” with the words: "within the sphere of their respective competence"; successively by Article 5 of Italian Legislative Decree no. 44 of 4/3/2014 which replaced the words: "and of SICAVs" with the words: ", of SICAVS and of SICAFS"; and lastly by Article 2 of Italian Legislative Decree no. 181 of 16.11.2015 which has added the last sentence. See Italian Legislative Decree no. 180 of 16/11/2015 (published in the Official Journal no. 267 of 16/11/2015).

315 Paragraph first amended by art. 5 of Italian Legislative Decree no. 44 of 4/3/2014 and lastly as replaced by art. 2 of Italian Legislative Decree no. 181 of 16/11/2015.

316 Subsection first added by art. 1 of Legislative Decree. N. 47 of 16.4.2012 and then amended by art. 2 of Legislative Decree. N. 181 of 16.11.2015 which replaced the words: “Insofar as they are compatible, Articles 83, 86, with the exception of paragraphs 6 and 7, 87, paragraphs 1, 2 and 4, 88, 89, 90, 91, with the exception of paragraphs 2 and 3, 92, 93 and 94 of the Consolidated Law on Banking” with the words: “Insofar as they are compatible, Articles 83, 86, with the exception of paragraphs 6 and 7, 87, paragraphs 2 and 3, 88, 89, 90, 91, with the exception of paragraphs 1-bis, 2, 3 and 11-bis, 92, 92-bis, 93 and 94 of the Consolidated Law on banking”.

317 Subsection first amended by art. 9 of Italian Legislative Decree no. 164 of 17.9.2007 and subsequently by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014, which replaced the words: "and the SICAV" with the words: ", the SICAV and the SICAF".

318 Paragraph amended first by Article 2 of Italian Legislative Decree no. 181 of 16/11/2015 which replaced the word: "recommended" with the word: "communication".

319 Subsection thus amended by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014 which after the words: "a SICAV" has introduced the words: "or a SICAF".

320 Paragraph first introduced by art. 1 of Italian Legislative Decree no. 47 of 16/4/2012 and subsequently thus amended by art. 2 of Italian Legislative Decree no. 181 of 16/11/2015 which has added the last sentence.

321 Paragraph added by art. 2 of Italian Legislative Decree no. 181 of 16/11/2015.

322 Article first amended by art. 22 of Italian Legislative Decree no. 274 of 1.8.2003 and subsequently thus replaced by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014.

323 Article added by article 2 of Italian Legislative Decree no. 181 of 16/11/2015.

324 The former wording “Minister of the Treasury, Budget and Economic Planning” was replaced with the wording “Minister of the Economy and Finance” by art. 1 of Legislative Decree no. 37 of 6.2.2004.

325 The compensation system was approved by a decrees issued by the Minister of the Treasury, the Budget and Economic Planning on 30.6.1998 and 29 March 2001, and by the Ministry of the Economy and Finance on 19 June 2007.

326 Subsection amended by art. 9 Legislative Decree no. 164 of 17.9.2007 which replaced the words: “The provision of investment services” with the words: “The issue of authorisation for the provision of investment services and activities”.

327 The former wording “Minister of the Treasury, Budget and Economic Planning” was replaced with the wording “Minister of the Economy and Finance” by art. 1 of Legislative Decree no. 37 of 6.2.2004.

328 Pending issue of the implementing provision referred to in this subsection, Decree 485 of 14.11.1997 issued by the Minister of the Treasury, the Budget and Economic Planning (published in Official Gazette no. 13 of 17.1.1998) shall apply. Also see the operating regulations approved in decrees issued by the Ministry of the Treasury, the Budget and Economic Planning on 30 June 1998 and 29 March 2001, and by the Ministry of the Economy and Finance on 19 June 2007.

329 Subsection amended by art. 9 Legislative Decree no. 164 of 17.9.2007.

330 Subsection first amended by art. 23 of Italian Legislative Decree no. 274 of 1.8.2003 and subsequently thus amended by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "of harmonised management companies" with the words: "of EU management companies and EU and non-EU AIFMs authorised in an EU State other than Italy".

331 Article first included by art. 10 of Italian Legislative Decree no. 197 of 9.7.2004 and subsequently amended by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014, within the terms specified in the following notes.

332 List thus replaced by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014.

333 Subsection thus amended by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "or of a SICAV" with the words: ", of a SICAV or a SICAF".

334 Subsection thus amended by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "or of a SICAV" with the words: ", of a SICAV, or a SICAF».

335 Subsection thus amended by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014 which replaced the words: "and SICAVs" with the words: ", SICAVs and SICAFs".

336 Subsection thus amended by art. 5 of Italian Legislative Decree no. 44 of 4.3.2014 which, at the end, added the following words: ", of EU management companies and EU and non-EU AIFMs authorised in Italy and non-EU AIFMs authorised in an EU Member State other than Italy".

337 Chapter added by article 2 of Italian Legislative Decree no. 181 of 16/11/2015.

338 See Italian Legislative Decree no. 180 of 16/11/2015 (published in the Official Journal no. 267 of 16/11/2015).

339 See Italian Legislative Decree no. 180 of 16/11/2015.

340 See Italian Legislative Decree no. 180 of 16/11/2015.

341 See Italian Legislative Decree no. 180 of 16/11/2015.

342 See Italian Legislative Decree no. 180 of 16/11/2015.

343 See Italian Legislative Decree no. 180 of 16/11/2015.

344 See Italian Legislative Decree no. 180 of 16/11/2015.

345 See Italian Legislative Decree no. 180 of 16/11/2015.

346 See Italian Legislative Decree no. 180 of 16/11/2015.

347 See Italian Legislative Decree no. 180 of 16/11/2015.

348 See Italian Legislative Decree no. 180 of 16/11/2015.

349 See Italian Legislative Decree no. 180 of 16/11/2015.

350 Article included by art. 10 of Legislative Decree no. 164 of 17.09.2007

351 Paragraph amended by art. 11 Legislative Decree no. 164 of 17.9.2007 which replaced the words: “minimum capital” with the words: “financial resources”.

352 See Consob Regulation no. 16191 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

353 Subsection thus amended by Article 11 of Italian Legislative Decree no. 164 of 17.9.2007 which replaced the words: “ and professionalism" with the words ", professionalism and independence" and then thus replaced by Article 4 of Legislative Decree no. 72 of 12.5.2015. See the regulation no. 471 issued by the Minister of the Treasury, Budget and Economic Planning on 11.11.1998 (published in Official Gazette no. 7 of 11.1.1999).

354 The former wording “Minister of the Treasury, Budget and Economic Planning” was replaced with the wording “Minister of the Economy and Finance” by art. 1 of Legislative Decree no. 37 of 6.2.2004.

355 Subsection amended by art. 11 Legislative Decree no. 164 of 17.9.2007 which removed the words: “, identifying the shareholding threshold relevant to this purpose”. See the regulation no. 471 issued by the Minister of the Treasury, Budget and Economic Planning on 11.11.1998 (published in Official Gazette no. 7 of 11.1.1999).

356 Subsection amended by art. 11 Legislative Decree no. 164 of 17.9.2007 which removed the words: “to Consob and”.

357 Subsection included by art. 11 Legislative Decree no. 164 of 17.09.2007. See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

358 Subsection included by art. 11 Legislative Decree no. 164 of 17.09.2007. See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

359 Subsection amended by art. 11 Legislative Decree no. 164 of 17.9.2007 which replaced the words: “subsection 5” with the words “subsection 6-bis”.

360 Subsection included by art. 11 Legislative Decree no. 164 of 17.09.2007

361 Subsection included by art. 11 Legislative Decree no. 164 of 17.09.2007

362 Subsection first amended by art. 11, Legislative Decree no. 164 of 17.9.2007 which replaced the words: “and 165” with the words “, 165 and 165-bis”, and later by art. 40, Legislative Decree no. 39 of 27.1.2010 which replaced the words: “, 158, 165 and 165-bis” with the words: “and 158”.

363 The former wording “Minister of the Treasury, Budget and Economic Planning” was replaced with the wording “Minister of the Economy and Finance” by art. 1 of Legislative Decree no. 37 of 6.2.2004.

364 See Minister of the Economy and Finance decree no. 216 of 22.12.2009 (published in Official Gazette no. 65 of 19.3.2010).

365 Subsection first replaced by art. 11 of Italian Legislative Decree n° 164 of 17.9.2007 and successively by art. 1 of Italian Legislative Decree n° 184 of 11.10.2012.

366 Subsection first included by art. 14, subsection 1 of Law no. 262 of 28.12.2005 and later amended by art. 11 Legislative Decree no. 164 of 17.9.2007.

367 Subsection included by art. 11 Legislative Decree no. 164 of 17.09.2007. See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

368 Subsection included by art. 11 Legislative Decree no. 164 of 17.09.2007. See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

369 Indent replaced by art. 11 Legislative Decree no. 164 of 17.09.2007

370 Letter thus replaced by Article 1 of Italian Legislative Decree no. 25 of 15.2.2016 which has eliminated the words: "and of financial instruments".

371 Letter included by Article 1 of Italian Legislative Decree no. 25 of 15.2.2016.

372 Paragraph included by art. 11 Legislative Decree no. 164 of 17.09.2007

373 Subsection added by Article 14 subsection 1 of Law 262/2005.

374 Subsection first replaced by art. 11 of Legislative Decree no. 164 of 17.9.2007 and then amended by art. 33 of Law no. 97 of 6.8.2013 which has replaced the words: "settlement" with the words: "liquidation".

375 Subsection added by Article 14 subsection 1 of Law 262/2005. See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

376 Subsection included by art. 11 Legislative Decree no. 164 of 17.09.2007

377 Subsection replaced by Article 11 of Legislative Decree no. 164 of 17.9.2007 which replaced the words: “paragraph d)” with: “paragraph b)”.

378 Heading amended by art. 11 Legislative Decree no. 164 of 17.09.2007

379 Subsection included by art. 11 Legislative Decree no. 164 of 17.09.2007. See Consob Regulation no. 16190 of 29.10.2007 (published in Ordinary Supplement no. 222, Official Gazette no. 255 of 2.11.2007).

380 Subsection replaced by art. 11 Legislative Decree no. 164 of 17.09.2007 which replaced the words: “verify the” with the words: “arrange and maintain effective devices and procedures for the control of”.

381 Paragraph added by Article 9 of Law 62/2005 (the 2004 Community Law).

382 The wording: “and immediately inform Consob about the decisions taken; implementation of admission decisions and of exclusion is suspended until the time specified in subsection 1-bis, paragraph a) have been added by Art.14 of I No. 262 of 28.12.2005. The wording: “and of exclusion is suspended until the time specified in subsection 1-bis, paragraph a)” have been replaced by the wording: “for trading of ordinary shares, bonds and other financial instruments issued by people or bodies other than those of Member States of the European Union, Community banks and companies having shares listed on a regulated market, including exclusion decisions of shares from trading is suspended until the time indicated in subsection 1-bis, paragraph a): this suspension is not applied in the case of admission to trading of financial instruments admitted for exemption from the obligation to publish the prospectus as well as admission of supplementary lots of shares already admitted to trading” by Art. 3 of Legislative Decree No. 303 of 29.12.2006 ”; and by Article 1 of Italian Legislative Decree no. 25 of 15.2.2016 which after the worlds: "the suspension of the financial instruments" has included the words: "from listing and from trading".

383 Paragraph removed by art. 1 Legislative Decree no. 195 of 6.11.2007.