Resolution no. 18081

Amendment to Resolution no. 17439 of 27 July 2010, including the definition of the terms and conditions for registration of third country auditors and audit entities pursuant to article 43, subsection 9, Italian Legislative Decree no. 39 of 27 January 2010

 THE COMMISSIONE NAZIONALE PER LE SOCIETA’ E LA BORSA (CONSOB)

HAVING REGARD TO Italian Law no. 216 of 7 June 1974, as amended;

HAVING REGARD TO Italian Legislative Decree no. 58 of 24 February 1998, as amended, and in particular article 161 containing provisions on the Special Register of audit firms held by Consob;

HAVING REGARD TO Directive 2006/43/EC of 17 May 2006 on statutory audits of annual accounts and consolidated accounts and, in particular, article 45 including provisions on the registration of third country auditors and audit entities;

HAVING REGARD TO Italian Legislative Decree no. 39 of 27 January 2010, containing provisions on the "Implementation of Directive 2006/43/EC on statutory audits of annual accounts and consolidated accounts, amending Directives 78/660/EEC and 83/349/EEC and repealing Directive 84/253/EEC" and, in particular, article 2, subsection 1, which establishes the Register held by the Ministry of Economy and Finance in which statutory auditors and audit firms are entered;

HAVING REGARD TO article 43, subsection 1, paragraph i), of the aforementioned decree, based on which article 161, Italian Legislative Decree no. 58 of 24 February 1998 is repealed but continues to apply until entry into force of the implementing provisions of said decree;

ALSO HAVING REGARD TO article 43, subsection 9, of the aforementioned Legislative Decree, based on which, until entry into force of the implementing provisions indicated in subsection 1 of the article in question, "Consob shall register third country auditors and audit entities referred to in article 34, subsection 1, in a specific section of the Special Register of Audit Firms envisaged in article 161, Italian Legislative Decree no. 58 of 24 February 1998, in accordance with the terms and conditions established therein";

Lastly, HAVING REGARD TO article 34, subsection 6, again of the aforementioned decree, based on which "the audit reports on annual or consolidated accounts of the entities referred to in subsection 1, issued by third country auditors and audit entities not entered on the Register of Statutory Auditors shall have no legal effect in Italy";

Given that, until set-up of said Register, the aforementioned article 34, subsection 6, is applicable to audit reports prepared by third country auditors and audit entities not entered in the specific Section of the Special Register held by Consob;

HAVING REGARD TO European Commission Decision of 29 July 2008, which enabled auditors and audit entities of some third countries, specifically identified by it, to continue their auditing activities, for a transitional period, as an exception to said article 45 of the Directive, provided that they submit the information required;

HAVING REGARD TO Resolution no. 17439 of 27 July 2010, whereby, amongst others, a specific Section A was established in the Special Register of audit firms envisaged by article 161 of the Consolidated Law, for the registration of third country auditors and audit entities pursuant to article 34, subsection 1 of Italian Legislative Decree no. 39 of 27 January 2010, registered, for a transitional period, in compliance with said European Commission Decision of 29 July 2008;

CONSIDERING that the transitional period identified in said European Commission Decision of 29 July 2008 expired with the audit reports on the annual and consolidated accounts for financial years closed as of 30 June 2011;

HAVING REGARD TO the subsequent European Commission Decision of 19 January 2011 permitting auditors and audit entities of certain third countries, as specifically identified by it and currently indicated in Annex 1 to this resolution, for the financial years closed until 30 July 2013, to continue their audit activities as an exception to article 45 of the Directive, provided that they submit the information required;

HAVING REGARD TO the above-mentioned European Commission Decision of 19 January 2011, which also declared the equivalence of the public oversight , quality assurance, investigation and penalty systems for auditors and audit entities of some third countries it had specifically identified - and, at present, which are indicated in Annex 2 to this resolution - specifying, for the United States of America, that this equivalence shall cease to apply on 31 July 2013;

CONSIDERING that the auditors and audit entities of third countries declared equivalent on the basis of this Decision of 19 January 2011, indicated in Annex 2, shall be subject to the same provisions on registration in force for auditors and audit entities of the third countries indicated in Annex 1 to this resolution;

CONSIDERING the need to adjust the provisions contained in said resolution no. 17439 of 27 July 2010 to the mentioned European Commission Decision of 19 January 2011;

ALSO GIVEN that, though it is not possible to accurately envisage the validity period of provisions adopted under this resolution, it is certain that they will be temporary, since they will be replaced by regulatory provisions as envisaged in article 34, subsection 7, of the decree referred to above, as soon as the Register is set up;

CONSIDERED, therefore, that it is possible to dispense with consultation of the representative bodies of supervised persons, financial service providers and consumers;

HEREBY RESOLVES:

Article 1
(Amendments to resolution no. 17439 of 27 July 2010)

1. The following amendments apply to Part I:

a) at Article 2, subsection 1, paragraph h), the words: "with the European Commission Decision of 29 July 2008" are replaced by the following: "with article 2 of the European Commission Decision of 19 January 2011";

b) at Article 3, subsection 2, the words: "with the European Commission Decision of 29 July 2008" are replaced by the following: "with article 2 of the European Commission Decision of 19 January 2011";

c) at Article 3, subsection 3, the words "with the European Commission Decision of 29 July 2008", are replaced by the following: "with article 2 of the European Commission Decision of 19 January 2011".

2. The following amendments apply to Part II:

a) in the list of Part II, the words: "with the European Commission Decision of 29 July 2008" are replaced by the following: "with article 2 of the European Commission Decision of 19 January 2011";

b) subsection 1 of Article 5 is replaced by the following:
"1. The provisions of this Part shall apply to third country auditors and audit entities of countries indicated in Annexes 1 and 2 to this resolution, that provide audit reports on the annual or consolidated accounts of the companies referred to article 34, subsection 1, Italian Legislative Decree no. 39 of 27 January 2010.";

c) at Article 9, subsection 1, the words "in Annex 1", are replaced by the following: "in Annexes 1 and 2".

3. Annex 1 is replaced by Annex 1 to this resolution.

4. In Form A pursuant to Article 6, subsection 1, the words: "with the European Commission Decision of 29 July 2008" are replaced by the following: "with article 2 of the European Commission Decision of 19 January 2011".

5. Annex 2 is added to this resolution.

Article 2
(Final provisions)

1. The provisions adopted under this resolution shall be valid until the date of entry into force of the regulations pursuant to article 34, subsection 7, Italian Legislative Decree no. 39 of 27 January 2010.

2. This resolution is to be published in Consob's Bulletin and in the Italian Official Gazette. It shall enter into force on the day after publication in the Official Gazette.

Milan, 25 January 2012

THE CHAIRMAN
Giuseppe Vegas

ANNEX 1

List of third countries to which the transitional period governed by the European Commission Decision of 19 January 2011 applies

Abu Dhabi

Bermuda

Brazil

The Cayman Islands

The Dubai International Financial C

Egypt

Guernsey

Hong Kong

India

Indonesia

The Isle of Man

Israel

Jersey

Malaysia

Mauritius

New Zealand

Russia

Taiwan

Thailand

Turkey

ANNEX 2

List of third countries for which the European Commission Decision of 19 January 2011 has declared that the public oversight , quality assurance, investigation and penalty systems for auditors and audit entities are equivalent.

Australia

Canada

China

Croatia

Japan

Singapore

South Africa

South Korea

Switzerland

United States of America (this will cease to apply on 31 July 2013)