A VIEW from milan
12 March 2001
The past year has seen a growing interest in the Italian market and an increase in the value and number of deals that have been consummated. Because of this, the Italian legislator has intervened to simplify the legal framework as regards corporate management. On 9 December 2000, Law Number 340, 14 November 2000 became applicable in Italy.
With the aim of simplifying incorporation and management of Italian companies, articles 32 and 33 of the law remove the requirement of the clearance of corporate deeds, previously under the competence of the civil courts. In essence, every extraordinary corporate deed was previously subject to the review of the competent courts, while now such formality is reserved for the notaries who are in charge of drafting the same deeds.
Given the heavy workload of the courts, the clearance procedure could take up to two months, depending on location. Bearing in mind that the clearance was a necessary formality for the deeds to be effective, it is evident that Italian corporations will now be more flexible and reactive in their management. So in cases of incorporation and in cases of amendments of corporations' by-laws, the Notary Public is now vested with the power to verify the legitimacy and regularity of the deeds or the resolutions adopted. Such deeds are then filed with the Business Register, which is responsible for assessing their formal regularity.
The new discipline also sets forth procedures to be followed in cases of rejection or complaints related to the deeds filed, only in this case courts will be involved again. In light of this, and of the new responsibilities assigned to the notaries, the Notarial Council in Milan appointed a specific committee to take substantial measures to apply the new discipline and to set guidelines to be followed. This has led to the issuance of initial principles producing significant innovations, and it is likely that additional ones will arise.
Up to now, the most important introduction concerns the possibility to hold shareholder meetings in audio/video-conference, a means previously available only for board of director meetings. In particular, the Notarial Council established the validity of the statutory clause providing for the possibility to hold the ordinary and extraordinary shareholder meetings of a corporation with the attendees located in different places through audio/video-conferences. These are held under the condition that principles of good faith and equal treatment of the shareholders are safeguarded, while maintaining the distinctive characteristics of a meeting of a plurality of individuals.
Some devices will be necessary. The chairman of the meeting should be able to verify the identity of attendees and their right to participate, to control the course of the meeting and to verify and declare the votes. As provided by corporate law, all such meetings must be reported in writing in the corporate books. Therefore, the recording subject should be allowed to suitably hear the interventions to be reported. The shareholders or other attendees should also be allowed to take part in the discussion and in the simultaneous votes.
To allow for such means to be used, the notice of call for the meeting will state the places connected by audio/video-conference where shareholders may go to attend the meeting. The formal venue of the meeting will be the location of both the chairman and the individual reporting the minutes. On a different note, but always in respect of a simplification of corporate management, it must be noted that through a decree of 22 January 2001 the Court of Milan established that notarial intervention will no longer be necessary for the conversion of the share capital into euros following the resolution of the administrative body of a corporation. The control carried out, case by case, by the Business Register will be considered sufficient.
Goffredo Guerra is head of the Milan office of Studio Legale Tonucci