This content is from: Local Insights

Fostering the assignment of claims against Italy’s public sector

On average the payment of claims of companies and individuals against the Italian public sector – central government, regions, municipalities, public entities, and so on – arising from public contracts is characterised by huge delays compared to other EU countries.

This has led to a considerable increase in the amount of overdue debts owed by the public sector, depriving struggling companies and individuals of much-needed liquidity.

A series of urgent rules have, therefore, been enacted through law Decree No 35 of April 8 2013, still to be converted into law, aimed at speeding up the payment of overdue debts by the public sector. The Decree has introduced a number of rules and procedures (including the establishment of an ad hoc liquidity fund) which should put the public sector in a position to fulfil its overdue debts.

Among others, the provisions of article 8 of Decree 35 will purportedly simplify and encourage the assignment of claims. According to article 8, in fact, the assignment of public claims which are certain, liquid and collectable and which were due and payable as at December 31 2012, is exempt from any levy, tax or duty of whatever nature (with the exclusion of VAT).

The benefit of such tax relief is, therefore, limited only to certain public claims depending on the relevant maturity date.

This restriction appears to be at odds with the principles of equal treatment and equality which are overriding under Italian law.

In addition, the existing rules regarding the assignment of public claims envisage that any such assignment needs to be made by a public deed or private writing authenticated by a notary.

Article 8 provides also that the relevant public debtor's competent officer in charge is allowed to authenticate the signatures on the deed of assignment of public claims. Should the authentication of signatures be made by a notary, the relevant fees are to be reduced by one half.

As regards the notice of assignment of public claims to the relevant public debtor – which is required under existing rules – article 8 provides that any such notice can be served also by registered letter with or without return receipt.

However, this provision reflects a rule on which, even before the enactment of Decree 35, both scholars and courts in their most recent rulings agreed, according to which the notice of assignment of claims does not need to be served through a process server provided that the relevant instrument bears a certain date (for the purposes of the effectiveness of assignment with respect to third persons).

Susanna Beltramo and Bruno Zerbini

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