Postponement of increased capital obligation
Shareholders' resolutions regarding specific increases of capital

Postponement of increased capital obligation

Pursuant to Paragraph 266 of the Budget Law 2021, which was issued on 30 December 2020, several duties relating to the mandatory coverage of company losses borne in 2020 have been postponed for five financial years, up until 2025.

The new rules partially extend Article 6 of Law 40/2020, which provides that in cases where joint stock companies or limited liability companies (Articles 2446 and 2447 or Articles 2482ter and 2482bis of the Civil Code) incur losses which cause their share capital to fall below the minimum legal requirement, such companies must increase their capital in order to cover the losses incurred.

According to the new rules, such obligation will be postponed up until the 2025 financial year (ie, potentially up until April 2026 or June 2026).

The new rules ease companies' financial commitments, as the winding-up obligation which applies pursuant to Article 2484 if a company's capital falls below the minimum legal requirement will not apply for five years.

However, boards of directors' duty to call shareholders' meetings immediately in the event of losses incurred by the company remains unchanged. Similarly, a company's explanatory note to the financial statements must make explicit reference to the losses which are covered by the postponement.

Shareholders' resolutions regarding specific increases of capital

Article 44 of Law 120/2020 (11 September 2020) has postponed the requirement for a two-thirds qualified majority of stock capital quorum to pass resolutions of extraordinary shareholders' meetings (ie, in the case of a specified increase of stock capital), as set out in Articles 2368 and 2369 of the Civil Code, until 30 April 2021.

By virtue of this rule, the mandatory quorum for extraordinary shareholders' meetings has been reduced to 50% of the stock capital represented at the shareholders' meeting. Consequently, companies can increase their capital much more easily.

Such rule will also apply where a company's articles of association provide a qualified majority higher than the abovementioned two-thirds, including where:

  • there is an increase of capital through contribution in kind or credits or option rights;
  • the articles of association are amended to exclude the option right set out in Article 2441; and
  • the board of directors has the right to increase the stock capital according to Article 2443 of the Civil Code.

For further information on this topic please contact Eugenio Vaccari at Grieco e Associati by telephone (+39 06 420 3881) or email ([email protected]). The Grieco e Associati website can be accessed at