Liquidity Decree - Golden Power Rules 

Law Decree n. 23 of 8 April 2020 (the “Liquidity Decree”) has introduced significant changes to the socalled “golden power rules” and to the disclosure duty of relevant shareholdings in listed companies. These rules are aimed at discouraging “predatory purchases” of Italian strategic and listed companies in times when their share price may be particularly depressed due to the COVID-19 emergency.

What are the main changes introduced under the Liquidity Decree with reference to the 'golden power' rules? In particular:

  • Art. 15 has innovated the transitional rules, extending both the scope of application of the notification duties and the powers that can be exercised by the Government;
  • Art. 16 has granted to the Government the direct power to start, at its own initiative, the procedures aimed at exercising the special powers If parties fail to comply with their notification duty; and
  • Art. 17 has amended article 120 of the Consolidated Financial Services Act to strengthen rules on disclosure of relevant shareholding and disclosure of intent for acquisitions of significant stakes in companies with an extended shareholder base (società ad azionariato diffuso), regardless of their market capitalization. ART.


Extended scope of application to include sectors not previously covered Article 15 of the Liquidity Decree extends the duty to notify acquisitions of controlling interests by non-EU entities to all sectors referred to in EU Regulation 452/2019.

These sectors include:

  • critical infrastructures (energy, transport, water, healthcare, media, defence and financial sectors);
  • critical technologies (AI, robotics, cybersecurity, aerospace, etc.), already previously covered under the Golden Power Rules. The Liquidity Decree expressly clarifies that these sectors include the credit and insurance sectors. Moreover, the following sectors are now also covered under the Golden Power Rules:
  • security of supply of critical assets and goods, including energy and raw materials, as well as food security;
  • access to sensitive information, including personal data, or the ability to control such information;
  • freedom and pluralism of the media. (jointly, all the above sectors previously and presently covered under the Golden Power Rules, the “Strategic Sectors”).
  • In addition, to mitigate the negative effects of the COVID 19 pandemic an additional notification duty, valid until 31 December 2020, is introduced for any resolutions, acts or transactions that result in a change of ownership, control, availability or destination of assets and relationships in the Strategic Sectors.

Extension of notification duty to EU person

Always to contain the negative effects of the epidemiological crisis, until 31 December 2020 the notification duty for the acquisition of controlling interests in the Strategic Sectors is now extended to EU entities.

Notification of significant shareholding in Strategic Sectors by non EU persons

Moreover, always during the transitional period until 31 December 2020, non-EU persons are obliged to notify acquisitions of equity investments in the Strategic Sectors which, considered cumulatively with the stakes already held, allow them to reach a threshold of voting rights or share capital equal to 10, 15, 20, 25 and 50 per cent, provided that the value of the investment is at least equal to one million euro.

Powers exercisable by the Government

In any event, the special powers of the Government in connection with acquisitions or other notifiable resolutions concerning the Strategic Sectors may be exercised only to the extent that the protection of the essential interests of the State, security or public order, are not adequately guaranteed by the existence of a specific sector regulation.


New autonomous powers for the Government to initiate the procedure aimed at exercising the special powers

Article 16 of the Liquidity Decree extends the traditional remedies for a breach of the notification duty (i.e., the nullity of the relevant acts and administrative penalty for non-compliance) by giving the Government the autonomous power to ascertain the breach of the notification duty and to start at its own initiative the procedure to exercise its special powers. Moreover, to allow the Government to collect data or information useful for its assessment on the exercise of the Golden Power:

  • the coordination group created in accordance with Prime Minister Decree of 6 August 2014 is now granted with the power to request documents and information directly from public authorities and public and private entities; and
  • the Prime Minister’s Office has the power to enter into mutual protocol of understanding with research institutes or entities.


Lowering of thresholds for disclosure of relevant shareholdings

Article 120 of the Consolidated Financial Services Act contains disclosure duties on relevant shareholding and authorizes CONSOB, the Italian Securities Regulator, to determine lower thresholds than the traditional ones (3% of the voting share capital or 5% for SMEs). This power can be exercised for “motivated reasons to protect investors and the efficiency and transparency of the market for corporate control and the stock market” and only with respect to “companies with a significant market value and particularly extensive shareholder base”.

Article 17 of the Liquidity Decree has eliminated the requirement relating to the “significant market value” so that this power can now be exercised, regardless of the market capitalization so also for smaller listed companies with an extensive shareholder base.

On 9 April 2020, CONSOB has exercised this power with resolution n. 21326, and has lowered the thresholds from 5% to 3% for SMEs and from 3% to 1% for all other listed companies. The companies concerned are listed in Annex.

By 27 April 2020, any persons holding as of 11 April 2020 a participation in excess of these thresholds in any of the companies listed in Annex must disclose their interest according to the procedure and terms set out in article 120 of the Consolidated Financial Services Act.

Strengthening of the “declaration of intent” rules for stakebuilding in listed companies

Article 120 of the Consolidated Financial Services Act requires companies acquiring significant shareholdings (exceeding 10%, 20% and 25%) in listed companies to disclose the objectives they intend to pursue in the six months following the acquisition (the “declaration of intent”).

Article 17 of the Liquidity Decree authorizes CONSOB, always for “motivated reasons to protect investors and the efficiency and transparency of the market for corporate control and the stock market” to provide for a lower threshold of 5% for the “declaration of intent”, always with regard to companies with an extended shareholder base, without any reference to its dimension or market capitalization.



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