Since December 19, 2012, the new provisions of Law Decree 18 October 2012, no. 179 (also known as the Decreto Sviluppo Bis), converted with amendments by Law 17 December 2012, no. 221, which introduces the innovative start-ups, have been coming into force.

The innovative start-up is an Italian or EU undertaking, which can have also the structure of a cooperative withregistered office in Italy, whose representing capital shares or quotas are not listed on a regulated market or on a multilateral trading facility.

The innovative start-up has specific law requirements, which include the obligations of spending on research and development a measure greater than or equal to 20% of the increased value of cost and the total value of production; of employing as employees or consultants a percentage equal to or greater than one-third of the total workforce of staff in possession of a Ph.D. or have a degree and who has held, for at least three years, research in certified public or private research institutes, in Italy or abroad; of having intellectual properties right relating to an industrial invention, biotechnology, a topography of semiconductor product or a new plant variety directly related to the company’s core business.

The Law Decree n.179/2012, as emended by the law of conversion, allows the innovative start-up to derogate to some specific requirements set out by the company law. In addition, it grants reductions on starting charges.

Moreover, this Law Decree allows the innovative start-ups to access  simply measures related to the staff recruitment. In particular, the tax credit is granted to highly qualified permanent employees, including hired through apprenticeships. In addition, the tax credit is granted priority over other companies.

Exclusive incentives are also defined, by the Law Decree mentioned above, to promote the development of the innovative start-up. In particular, for the years 2013, 2014 and2015, an amount equal to 19%of the amount invested by the taxpayer in the share capital of one or more innovative start-ups can be detraered by the tax on the gross income of individuals.

Finally, this Law Decree states a specific regulatory framework for the composition and management of the crisis in the innovative start up company, and for the employment relationship, which willbe applicable for the period of four years from the date of incorporation of the innovative start-up. Hence, the fixed-term contract may be signedfor a minimum period of six months and a maximum of thirty-six months. However, if, as a result of a succession of fixed-term contracts, the employment relationship between the employer andthe worker should have exceeded a total of thirty-sixmonths, including extensions or renewals, the employment relationship would be considered permanent.