10 April, 2020
Decree Law no. 23 of 8 April 2020
On 8 April 2020, the Italian Council of Minister approved Law Decree no. 23, published in the Official Gazette (General Series no. 94, Extraordinary Edition of April 8, 2020), containing “Urgent measures related to access to credit and tax obligations for businesses, special powers in strategic industry sectors, as well as healthcare and employment interventions, prorogation of administrative and procedural deadlines”.
Law Decree no. 23/2020 (the so-called ‘Decreto Liquidità’) (Decree) includes a number of provisions that significantly affect the application of Insolvency Law, for the period of Covid-19 emergency, which are summarised below.
Measures for access to credit for Small and Medium-sized Enterprises (SMEs)
Liquidity support for companies with registered offices in Italy (guaranteed amount up to €200 billion, with €30 billion reserved for SMEs), including:
- SACE guarantee on bank loans issued by December 31, 2020 with a maximum duration of six years in favour of enterprises based in Italy
- The maximum guaranteed amount depends on the number of employees and the turnover of the enterprise
- The financing shall cover personnel costs, investments, or working capital related to activities to be carried out in the Italian territory
Liquidity support for SMEs (€1.7 billion), including:
- Prohibitions to revoke, in whole or in part, overdraft facilities and loans granted against advances on credits existing as of 29 February 2020, until 30, September 2020
- Extension of loans to be repaid bullet before 30 September 2020 together with the relevant ancillary items, without any formalities and under the same conditions, until 30 September 2020
- Suspension of the payment of loan instalments and rental payments on financial leases due before 30 September 2020, until 30 September 2020 and extension of the relevant amortization or rental payments plans; at the request of SMEs, the suspension could be granted on the principal portion only
Increase in the Public Guarantee Fund for SMEs (EUR 1.5 billion).
- The fund can release:
- 100% guarantee for loans up €25,000, without any creditworthiness valuation;
- 100% guarantee for loans up to €800,000;
- 90% guarantee for loans up to € 5millions.
Extension of the deadlines for the fulfilment of arrangement with creditors and debt restructuring agreements proceedings.
The deadlines for completing the arrangement with creditors procedure (concordato preventivo) and debt restructuring agreements (accordi di ristrutturazione del debito) proceedings expiring between 23 February 2020 and 31 December 2021 are extended by 6 months.
Urgent labour measures
State Aids to Companies and Workers
New Ordinary CIG:
General Rules: Ordinary CIG (“Cassa Integrazioni Guadagni Ordinaria”) is a State economic aid for companies active in certain sectors provided by Sec. 10 of Legislative Decree 148/2015, including manufacturing, industrial, building.
Italy Care Decree Exceptions: Italy Care Decree provides that Ordinary CIG may be exceptionally obtained without previous negotiation with Trade Unions (all steps, including such negotiation, shall be taken within 3 days after the request).
Both Ordinary CIG and Ordinary Check may be requested:
- For all employees working in the company by February 23, 2020, notwithstanding their seniority;
- For a limited term of up to 9 weeks starting from February 23, 2020 until August 2020.
Suspension of Solidarity Check and Temporary Change to Ordinary Check:
Solidarity Checks (“Assegno di solidarietà”) are economic aids granted at certain conditions to companies which may not enjoy Ordinary or Special CIG.
Companies currently enjoying Solidarity Checks (“Assegno di solidarietà”) – economic aids granted to companies which may not enjoy Ordinary or Speciali CIG – may suspend it and request its temporarily replacement with Ordinary Check for 9 weeks’ time.
Special Contributive Advantage:
With respect to any special aid granted under Italy Care Decree, the additional contribution to be paid by the employer is not due for the time such aid is given.
No Dismissals Policy:
For the period of 60 days after March 18, 2020, collective dismissal procedures pursuant to Sections 4, 5 and 23 of Law no. 223/1991 may not be activated;
Collective dismissal procedures activated after February 23, 2020 are suspended;
Dismissals based on objective justified reason pursuant to Section 3 of Law no. 604/1966 are forbidden and ineffective.
Tax and accounting measures
- Suspension of tax contributions for taxpayers with tax domicile, operating, and/or registered office in Italy, until May 31, 2020
- Suspension of tax contributions for companies with a turnover of less than €2 million with tax domicile, operating, and/or registered office in Italy, until 31 May 2020;
- Suspension of tax contributions for individuals carrying on business activities with tax domicile, operating, and/or registered office in Italy, with turnover r earnings that o not exceed €50 million who recorded a decrease of more than 33% in their turnover, until 31 May 2020
- Suspension of tax collection files and tax controls until 31 May 2020
- Encourage the sale of impaired loans with the aim of supporting companies in terms of liquidity through the possibility of transforming into a tax credit a portion of deferred tax assets (DTA) relating to certain components, for an amount proportional to the value of the impaired receivables that are transferred to third parties.
We are at your disposal if you want to contact us for further information.
