{"id":9445,"date":"2024-12-03T11:07:43","date_gmt":"2024-12-03T10:07:43","guid":{"rendered":"http:\/\/explegal.local\/corrective-decree-ter-business-crisis-code\/"},"modified":"2026-07-08T14:54:43","modified_gmt":"2026-07-08T12:54:43","slug":"corrective-decree-ter-business-crisis-code","status":"publish","type":"post","link":"https:\/\/explegal.it\/en\/corrective-decree-ter-business-crisis-code\/","title":{"rendered":"The Third Corrective Decree to the Italian Business Crisis and Insolvency Code"},"content":{"rendered":"<p><span style=\"font-family: 'times new roman', times, serif;\"><span style=\"color: #000000; font-size: 12pt;\"><span style=\"color: #000000; font-size: 12pt;\"><br \/><\/span><\/span><br \/><\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\"><strong>Introduction<\/strong><\/p>\n<p>Legislative Decree No. 136\/2024, published in the Official Gazette on September 26, 2024, also known as the &#8220;Third Corrective Decree,&#8221; introduces significant amendments to the Business Crisis and Insolvency Code. The decree is part of Italy&#8217;s National Recovery and Resilience Plan (PNRR) and aims to enhance the efficiency of the reform of the restructuring italian system. Among the key changes is the potential introduction of agreements with public creditors, allowing businesses, including small entities, to negotiate tax debts, including local taxes and social security contributions, within the framework of the negotiated settlement.<\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\"><strong><br \/>Regulatory Update<\/strong><\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">The Business Crisis and Insolvency Code, established by Legislative Decree No. 14 of January 12, 2019, replaced the Bankruptcy Law (Royal Decree No. 267\/1942). Initially scheduled to take effect as of August 15, 2020, its implementation was delayed due to the COVID-19 pandemic and the need to incorporate the principles of EU Directive 2019\/1023 (the &#8220;Insolvency Directive&#8221;). The reform also aligns with the EU\u2019s 2014\/135 Recommendation, Regulation EU 2015\/848 on cross-border insolvency, and UNCITRAL&#8217;s Model Law on insolvency, facilitating the mutual recognition of judicial decisions in cross-border cases.<\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">Legislative Decree No. 136\/2024 comprises 57 articles divided into two parts:<\/span><\/p>\n<ul>\n<li><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\"><strong>Part I<\/strong>: Amendments to the Business Crisis and Insolvency Code (Articles 1\u201351);<\/span><\/li>\n<li><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\"><strong>Part II<\/strong>: Coordination, repeals, transitional, and financial provisions (Articles 52\u201357).<\/span><\/li>\n<\/ul>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">Despite the necessity of these legislative interventions, some professionals have criticized the frequent modifications, highlighting concerns over the lack of coherence between new provisions and pre-existing rules. This has created confusion among stakeholders, including creditors and other interested parties.<\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\"><strong><br \/>Relevance for Businesses<\/strong><\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">One of the most significant aspects of the decree is its emphasis on crisis prevention. The legislator seeks to enhance early warning mechanisms through a more proactive crisis management system. This provides consultants, control bodies, and boards of statutory auditors with practical tools to identify risks and maintain business continuity before a financial collapse occurs.<\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">This approach reinforces the role of negotiated settlements to address financial imbalances, encouraging businesses to resolve crises early. Control \u00a0bodies, including auditors and boards of statutory auditors, now bear increased responsibilities, as they must report actual crises or insolvencies\u2014not merely warning signs\u2014thus promoting accountability.<\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">The legislative framework prioritizes business functionality and market presence over merely safeguarding the entrepreneur&#8217;s assets for creditor\u2019s satisfaction. This represents a shift from the traditional view of insolvency as a managerial failure requiring state oversight, moving toward a model that values employment retention and operational continuity over creditor-debtor disputes.<\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\"><strong><br \/>Role of Financial Intermediaries<\/strong><\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">The decree introduces specific duties for financial intermediaries during the negotiated settlement process. Banks must maintain existing credit facilities and cannot suspend or revoke them solely because the procedure has commenced. Changes to credit terms are allowed only if justified by the restructuring plan and regulatory requirements. Additionally, any decisions by financial institutions must be fully documented, ensuring transparency.<\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">Crucially, the continuation of credit relationships does not expose financial intermediaries to liability for abusive lending if the restructuring efforts ultimately fail. This provision protects banks and facilitates cooperation between financial institutions and distressed businesses.<\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\"><strong><br \/>Tax settlements<\/strong><\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">A major innovation of the Third Corrective Decree is the extension of tax settlements, previously available in other restructuring tools, to negotiated settlements. This mechanism allows businesses facing financial distress or insolvency to request the appointment of an expert from the Chamber of Commerce to mediate agreements with creditors, including public entities.<\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">The tax settlement now encompasses local taxes and social security contributions. It must offer a better outcome than judicial liquidation, with its feasibility verified by an independent professional and its data completeness certified by an auditor.<\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\"><strong><br \/>Fiscal Cram Down<\/strong><\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">The decree introduces stricter criteria for fiscal <em>cram downs,<\/em> a contentious area balancing public creditor interests with business recovery needs. For restructuring agreements, the minimum satisfaction threshold for public creditors has been raised from 30% of debts (including penalties and interest) to 50%, excluding penalties and interest. This ensures an higher recovery rate for public entities while maintaining support for viable restructuring plans.<\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\"><strong><br \/>Negotiated Settlement<\/strong><\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">The decree refines the framework for negotiated settlements, emphasizing the importance of early intervention and professional support. Businesses can activate this out-of-court procedure through the Chamber of Commerce, appointing an expert to assist in negotiations with creditors and stakeholders.<\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">The expert, a seasoned professional in business crisis management, assesses restructuring prospects, identifies viable solutions, and drafts a report that is uploaded to a national platform for transparency. During the procedure, businesses benefit from tax incentives and protective measures, including a moratorium on creditor actions and protection against insolvency filings.<\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">For business groups, specific provisions ensure unified proceedings, while smaller enterprises are afforded simplified processes. If negotiations fail despite good faith efforts, businesses may transition to a simplified liquidation procedure to wind down operations.<\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\"><strong><br \/>Conclusion<\/strong><\/span><\/p>\n<p><span style=\"font-family: 'times new roman', times, serif; font-size: 12pt;\">The Third Corrective Decree represents a significant step in enhancing Italy\u2019s restructuring framework, prioritizing prevention and stakeholder cooperation. While it introduces valuable tools for businesses and intermediaries, its effectiveness will ultimately depend on the consistent application of its provisions and the active engagement of all stakeholders in fostering a culture of early crisis composition.<\/span><\/p>\n<p><span style=\"color: #000000; font-size: 12pt; font-family: 'times new roman', times, serif;\"><br \/>&#8212;<\/p>\n<p><b>Learn more<\/b>:<\/p>\n<p><\/span><span style=\"color: #000000; font-size: 12pt;\"><span style=\"font-family: 'times new roman', times, serif;\"><strong>&gt;\u00a0<a href=\"en\/experts-en\/giorgio-cherubini-en\">Avv. Giorgio Cherubini<\/a><\/strong><\/span><br \/><span style=\"font-family: 'times new roman', times, serif;\"><strong>&gt; <a href=\"en\/expertise-en\/exp-for-insolvency-and-restructuring\">EXP for Insolvency and Restructuring<\/a><\/strong><\/span><\/p>\n<p><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Introduction Legislative Decree No. 136\/2024, published in the Official Gazette on September 26, 2024, also known as the &#8220;Third Corrective Decree,&#8221; introduces significant amendments to the Business Crisis and Insolvency Code. The decree is part of Italy&#8217;s National Recovery and&#8230;<\/p>\n","protected":false},"author":30,"featured_media":9444,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[2530,2480,2190,2528],"class_list":["post-9445","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles","tag-codice-della-crisi-e-dellinsolvenza","tag-fallimento","tag-giorgio-cherubini","tag-restructuring"],"acf":[],"_links":{"self":[{"href":"https:\/\/explegal.it\/en\/wp-json\/wp\/v2\/posts\/9445","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/explegal.it\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/explegal.it\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/explegal.it\/en\/wp-json\/wp\/v2\/users\/30"}],"replies":[{"embeddable":true,"href":"https:\/\/explegal.it\/en\/wp-json\/wp\/v2\/comments?post=9445"}],"version-history":[{"count":1,"href":"https:\/\/explegal.it\/en\/wp-json\/wp\/v2\/posts\/9445\/revisions"}],"predecessor-version":[{"id":9940,"href":"https:\/\/explegal.it\/en\/wp-json\/wp\/v2\/posts\/9445\/revisions\/9940"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/explegal.it\/en\/wp-json\/wp\/v2\/media\/9444"}],"wp:attachment":[{"href":"https:\/\/explegal.it\/en\/wp-json\/wp\/v2\/media?parent=9445"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/explegal.it\/en\/wp-json\/wp\/v2\/categories?post=9445"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/explegal.it\/en\/wp-json\/wp\/v2\/tags?post=9445"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}