As mentioned in our recent article, the original set of measures on foreign investment control issued by the Italian Government at the beginning of April 2020 (described in one of our previous articles) has been partially amended when converted into Law.
The Government’s veto power now extends to the agri-food and steel sectors and until December 31, 2020 all measures introduced during the coronavirus outbreak (which again significantly expand the Italian Government’s powers to veto acquisitions, including acquisitions made by EU acquirors) may be used by the Italian Government to protect maintenance of employment levels and national productivity in these sectors.[1]
Based on the announcement by the Member of the Italian Parliament who proposed the change, her intent was to protect the sale of one of the Italian oldest steel companies (Acciai Speciali Terni).
Also with respect to the change at issue, is difficult to imagine how foreign investment control powers vis-à-vis EU acquirors to protect national productivity may be reconciled with the EU law which in no case allows restrictions against EU players’ freedom to move capital and freedom of establishment on economic grounds. Hence, also this new provision poses many questions and we deem that it will be subject to significant scrutiny in the near future.
[1] Section 17 of Law Decree no. 23 of April 8, 2020 as amended by Law no. 40 of June 5, 2020.
