INCORPORATION OF AN ITALIAN COMPANY UNDER THE FORM OF AN S.P.A. OR S.R.L.
A. DOCUMENTARY REQUIREMENTS
- The Articles of Incorporation and Bylaws for either an S.p.A. (Società per Azioni – joint stock company) or an S.r.l. (Società a responsibilità limitata – limited liability company) must set forth the following:
- The name of the company
- The nature of the proposed business
- The amount of capitalization
- The amount of stock to be issued
- The location of its registered office
- The number of directors (whether a sole director or a board of directors) and their respective powers
- Whether the fiscal year should coincide with the calendar year
- The duration of the company
The Articles of Incorporation and the By-laws are filled in to the Italian Chamber of Commerce by the public Notary.
- If the incorporators intend to act through representatives, it is necessary to provide a power of attorney from each of the incorporators. For the power of attorney to be operative under Italian law, it must meet the following:
- Be in Italian
- Be notarized by a notary public
- Be apostilled in accordance with the Hague Convention of October 5, 1961. [to be verified State by State]
Such a resolution must specify the purposes, address, and capital of the Italian company, as well as the respective equity contributions, stated in euro. The resolution should grant to the officer who is to execute the power of attorney referred to above all the necessary powers in connection therewith.
The incorporators should also include official certificates stating that each of the companies involved in the incorporation exists and is not in voluntary or compulsory liquidation or subject to bankruptcy proceedings (certificates of good standing of the incorporators).
B. TIME REQUIREMENTS
- To proceed with the incorporation, usually requires 2 weeks.
C. CORPORATE STRUCTURE AND FUNCTION
- Management System: Either type of corporation may have a Board of Directors or a sole Director, any or all of whom may be foreign citizens residing abroad. It is common practice to appoint one of the members of the Board of Directors as Managing Director with ample powers to represent the company;
- Legal Accounting Control: Auditing control varies depending on the type of incorporation and the other conditions specified below:
- S.r.l.: The appointment of a Board of Auditors is required only in same case indicated by the Italian law.
- S.p.A.: Auditing control is in any case required
- Required Minimum Capital
- The S.r.l. has a minimum capital of € 10,000. The immediate cash contribution must be at least 25% of the share capital of the S.r.l.Please note that there is the possibility to incorporate a S.r.l.s. which is a company like the S.r.l. whose capital may be of € 1 and maximum € 10.000.The law requires the remaining 75% to be subject to call by the Board of Directors as needed. The amount of capital subscribed and paid-in must be shown on the letterhead and on all official instruments.
- The S.p.A. has a minimum capital of € 50,000. The immediate cash contribution must be at least 25% of the share capital of the S.p.A. However, if the S.p.A. is incorporated by a single shareholder, the entire amount of the share capital must be paid. The law requires the remaining 75% to be subject to call by the Board of Directors as needed. The amount of capital subscribed and paid-in must be shown on the letterhead and on all official instruments.
- Quotas and Shares: an S.p.A. issues shares of stock while an S.r.l. may not. The S.r.l. entitles equity owners to a quota holding in the corporation proportionate to their capital contribution.
D. COSTS OF INCORPORATION
- Fiscal costs of incorporation for either the S.p.A. or the S.r.l. are very similar and depend, in part, on the amount of capital subscribed and the range is from € 600 to € 1,000.This does not include notary fees and the legal assistance.