How to register a company in Italy

Italy may be the perfect place to start your dream business. It has the 3rd largest national economy in the EU, after France & Germany! This position is owed by its strong business economic sector; agricultural sector; and manufacturing. In Agriculture, the country is considered the largest producer of wine in the world. In manufacturing, it's renowned for its luxurious goods and is second only to Germany.

Business does so well in Italy because of the country's stable political environment and favorable company laws. Just recently, legislators gazetted to introduce measures that improve the country's position as a welcoming home for foreign businesses. If you would like to start a business in Italy, you only need to complete a few steps. The time taken to finish the business registration processes is about 15 working days.

Who can register a business in Italy?

Any person, whether local or foreign (i.e. non-EU or EU resident) can start a business in Italy. However, you should note that the condition for participation by non-EU residents will be met by reciprocity. Individuals or legal entities from the EEA & the EU may be treated the same as Italian citizens, i.e. without any barriers to business. Investments made by foreigners from outside the EU usually may face some restrictions.

What to consider when choosing to do business in Italy

Before starting the business registration process in Italy, you may want to assess certain things to confirm its viability and profitability for business. Most importantly, you may want to know if you can have all the requirements for the registration process.

The initial things to consider include acquiring knowledge of:

The industry you want to venture in;
Types of legal entities found in the State and choosing one;
The company's business location. Cities in Italy have different costs and rules;
The trade agreements between your country and Italy.

You can obtain any information you want through the help of SIGTAX in Italy. SIGTAX will provide legal advisors who understand the business in Italy.

Types of companies Italy

This type of corporation is characterised by the following characteristics.

Commonly used for SMEs;
Requires a minimum of one shareholders who contribute at least €1 in share capital;
Requires at least one director for completion of the company registration processes. The director can be any individual, regardless of nationality;
When the business operations have begun, the company should file an annual tax return to the Revenue Agency. Financial statements are also needed;
Audits of the financial statements may be called for if the LLC has a gross turnover above 8.8 million, assets valued above 4.4 million, and employees exceeding 50.

This is the second type of corporation that can be setup in Italy. It's characterized by the following:

Best suited for larger companies. Opened by individuals who want to list the company on the Stock Exchange or raise large amounts of capital from third-parties;
Requires a minimum share capital of €50,000;
At least one director and auditor should be appointed. The auditor must be resident in Italy;
A board of administrators should be set up to make sure that the director(s) actions serve the shareholder's interests.

Instead of establishing a subsidiary, a foreign business looking for opportunities in Italy can simply open a branch office. This branch office should have:

A management team which is independent;
One representative who ordinarily resides in Italy;
A business bank account in Italy.

The benefits of setting up a branch office is that the company's head office will only file one set of financial statements. The disadvantage is that the head office has unlimited liability against any losses or debts of the branch office.

The RO is the easiest and most inexpensive form of legal entity to register in Italy. There are no minimum capital requirements and the distinguishing characteristic of the company is its limited scope of business. ROs in Italy cannot participate in profit-making activities. They can only be legally involved in preparatory activities, e.g. market research.

Foreign investors may also set up partnership businesses in Italy. The types of partnerships available are the limited partnership, general partnership and the partnership limited by shares. It's important to note that the partnerships in Italy are not treated as separate legal entities. Thus, the partners can have joint or some liability for the obligations of the partnership.

Documents required for registering a company in Italy

Personal identification documents e.g. a passport or ID;
The memorandum and articles of association;
Shareholder information regarding payments of shares (if available);
For foreign registered companies, a Certificate of Registration and related incorporation documents

It's important to note that all documents that need to be drafted should be prepared and notarized by an Italian public notary.

Steps for registering a company in Italy

The following are the steps for registering a company in Italy.

Deciding the type of legal entity for your business;
Finding a unique name of the company;
Finding a suitable location for the business operations;
Preparing relevant documents for the business registration e.g. articles of association, specimen signatures from directors and shaeeholders, affidavits, etc;
Opening a corporate bank account;
Payment of the business required share capital;
Company registration

The documents and processes involved in registering your company may vary depending on the type of legal entity to be registered. The same is true regarding the business start-up costs. You may also need an accountant to ensure that you meet the accountancy requirements in Italy.

Registration of a company in Italy

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