The competitiveness decree1 (Decreto competitività), was published in the Italian Official Gazette on 20 August 2014 andcame into force on 21 August 2014.

Set out below, in brief, are the main provisions regarding measures aimed at facilitating access to financing by Italian companies.

Tax measures to boost access to credit

The substitute tax (imposta sostitutiva) regime on medium - long term financings has been extended to credit receivable assignments (cessioni di credito) and to all assignments and/or transfers of the loans and related security in a syndication scenario. Furthermore, medium - long term financings entered into by securitization vehicles and insurance companies (subject to supervision by a regulatory body of an EU Member State) may benefit from the substitute tax regime.

Withholding tax:

  • General regime, ordinarily applicable to interest payments, it has been repealed with respect to interest from mid-long term financings granted to Italian resident businesses by European banks, funds or insurance companies located in the European Economic Area.
  • Withholding tax exemption for UCITs: the Decree has clarified that the withholding tax exemption (previously provided by the Italian Law Decree no. 83 dated 22 June 2012 converted with amendments by Law no. 134 dated 7 August 2012) is applicable to interest on bonds and similar securities issued by UCITs (organisimi di investimento collettivo dle risparmio) established in Italy or in an EU Member State, investing more than 50% of their assets in such bonds or similar securities and provided that they are held by “qualified investors”, as identified by the Italian Consolidated Law on Finance (the Italian Legislative Decree no. 58 dated 24 February 1998).
  • Withholding tax exemption for Securitization Vehicles. The same provision mentioned above has extended this regime to securitization vehicles compliant with Italian Law no. 130 dated 30 April 1999.
  • Withholding tax exemption for bonds and similar securities(obbligazioni e titoli similari): Article 1 of the Italian Legislative Decree no. 239 dated 1 April 1996 (Decree no. 239), has been amended by the Decree in order to provide – in addition to the other exemptions already provided by the Decree no. 239 – that withholding tax ordinarily applicable on interest payments does not apply to bonds and similar securities issued by unlisted companies even where those bonds and similar securities are not listed, provided that they are held by “qualified investors”, as identified by the Italian Consolidated Law on Finance (the Italian Legislative Decree no. 58 dated 24 February 1998). As a result, there has been an extension of the entities which may benefit from the Decree no. 239, which in some cases provides for an exemption from taxation for income arising from the mentioned securities, provided the relevant conditions are satisfied..

Tax credits for investment in machinery and equipment: companies which invest in new machinery or equipment can apply for a 15 per cent tax credit of the expense which exceeds the average annual investment made by the company during the previous five (5) years, provided that the investment:

  • is over €10,000;
  • was made during the period between 25 June 2014 and 30 June 2015.

The new role of SACE, insurance companies and securitization vehicles as lenders


The Italian export credit agency SACE will be allowed to grant financings directly to Italian businesses (but not individuals), provided that, inter alia:

  • borrowers are identified by banks or by any other financial intermediary;
  • the bank or financial intermediary identifying the borrower must retain a commercial interest in the transaction, at least equal to 5% of the financing, until the end of the transaction. Such interest can be transferred to another bank or financial intermediary; and
  • that the arrangements comply with the Bank of Italy’s technical rules for this activity.

In addition, the decree provides that the State may issue a guarantee to SACE for non-marketable risks in financings relating to “strategic sectors” of the Italian economy. SACE must make a request for this type of guarantee, which will be issued by way of a Ministerial Decree, following the approval of IVASS.

Insurance companies

Italian insurance companies will be allowed to provide financing under the same conditions mentioned above for SACE with the sole exception that, in this case, the borrower (subject to the prior approval of IVASS) can also be identified by the insurance company itself. In this case the insurance company will not be required to retain a 5% of the financing until the end of the transaction.

IVASS, the Italian insurance market regulator, is to provide rules concerning the terms and conditions of financings granted by insurance companies.

To further support lending by insurance companies, the decree has provided that such financings fall within the assets that insurance companies may hold as investments for the purpose of complying with their technical provisions (riserve tecniche) requirements. Furthermore, companies will now be allowed to invest in securities issued by securitization companies (including mini-bonds) in order to cover technical reserve requirements.

Securitization vehicles

Securitization vehicles incorporated under the Italian Securitization Law (Law No. 130 of April 1999) will also be allowed to provide financing directly to Italian businesses. In this case, the notes issued as a back-to-back for the financings must be marketed to “qualified investors” only.