Italy: Fulfilment of half-yearly report in capital companies also during Covid


published on 30 September 2020 | reading time approx. 1,5 minutes


The suspension of the recapitalization obligation, provided for by the Decreto Liquidità (Decree-Law no. 22 of 8 April 2020), does not suspend the half-yearly monitoring obligation in limited liability companies.


Following the introduction last year of Article 2475, section 6, of the Italian Civil Code by the “Code of Business Crisis and Insolvency” (Codice della crisi) which refers to Article 2381, section 5, of the Italian Civil Code, also limited liability companies (S.r.l.) shall apply the rule on the half-yearly reporting of managing directors on the performance of operations.
Since this is still a relatively new obligation, first of all we would like to remind you that, pursuant to Article 2381, section 5 of the Italian Civil Code,
“the delegated bodies [...] shall report to the Board of Directors and the Board of Auditors, with the frequency set out in the articles of association and in any case at least every six months,

  • on the general performance of operations;
  • its foreseeable evolution; as well as
  • on the most significant transactions - due to their (i) size or (ii) characteristics - carried out by the company and its subsidiaries”.

The six-monthly term (or the shorter one if provided for in the Articles of Association) is calculated from the last meeting of the administrative body that approved the draft of the financial statements. It follows that in companies which approved the draft of the financial statements within the Board of Directors in April 2020, the half-yearly monitoring period ends in October 2020.
The application of this provision also to limited liability companies was introduced in the first place to guarantee, with more frequent and fixed deadlines in a much larger number of companies, a stronger monitoring and control of the performance and the economic-financial situation and to prevent possible crisis situations through the eventual obligation of the administrative body to inform shareholders in case of losses pursuant to Articles 2482-bis and 2482-ter (for Italian limited liability companies) or Articles 2446 and 2447 (for Italian joint stock companies) of the Italian Civil Code. 
Although the shareholders' recapitalization obligation in order to carry on a loss-making business has been suspended by Article 6 of the Decreto Liquidità, the abovementioned reporting obligation  (including the directors, who do not form a board and the sole directors) remains unchanged.
We therefore underline the persistent obligation of the directors to ascertain the existence of a possible loss and, if this should exceed one third of the capital, to call the shareholders' meeting “without delay” and in any case within thirty days.
In good time before the entry into force of the further provisions of the Codice della Crisi on 1  September 2021, we will further examine this obligation for an even more stringent control of the company's economic-financial situation.
The Firm is at your disposal, if you wish to have more information on the new corporate obligation or if you need assistance in the preparation of the relative minutes or the report itself.

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