• Shared responsibilities.
• Unlimited liability.
• Jointly owned business by two or more individuals.

A general partnership is a business arrangement whereby two or more individuals agree to share responsibilities, assets, profits, financial and legal liabilities of a jointly owned business; granting unlimited liability.

High personal risk but shared management and profits; suitable for businesses with strong trust between partners.

• Must be registered with the Registro delle Imprese.
• Unlimited liability.

A Simple Enterprise must be registered with the Registro delle Imprese and has unlimited liability.

Offers simplicity but with significant personal financial risk; suitable for small-scale businesses.

• Combination of limited and unlimited liability.
• Some partners not involved in management.
• Minimum capital requirement of EUR 50,000.

In a limited partnership, some partners are not entitled to manage its affairs but provide all or part of the partnership's capital. These partners are limited in their liability. In addition, one or more other partners are nominated as managing or general partners and have unlimited liability for the partnership's debt and losses.

Combines investment opportunities with risk management; requires careful consideration of roles and capital.

• Corporate structure protecting owners from personal liability.
• Minimum capital investment of EUR 10,000.

An LLC is a corporate structure that protects its owners from being personally responsible for any liabilities. A minimum capital investment of EUR 10,000 is required.

Ideal for small to medium-sized enterprises looking for liability protection and straightforward management.

• Owned by investors with shareholding.
• Minimum capital requirement of EUR 50,000.

A Joint Stock Limited Company is a business owned by its investors, with each investor owning a share of the company based on the contributed investment. The company requires a minimum capital of EUR 50,000.

Suitable for large enterprises with multiple investors seeking to raise significant capital.

• Available at Registro delle Imprese.
• Accessible through the Business Register of the Italian Chambers of Commerce.

Corporate information is available at Registro delle Imprese, the Business Register of the Italian Chambers of Commerce: https://www.registroimprese.it/.

Utilize Registro delle Imprese for official business information. Ensure accurate and updated data by regularly checking this source.

• Financial state information from Registro delle Imprese and private agencies.

You can obtain information on the financial state of affairs for companies and industry at Registro delle Imprese. There are also numerous private reporting agencies offering credit checks.

Combine official sources with private agency reports for a comprehensive view of a company's financial health.

• Judgment information typically found in credit reports.

Normally, you find this information in a credit report. Credit reports are offered as a service online.

Check credit reports regularly for judgment information. For critical business relationships, consider thorough searches with legal support.

A claimant is free to choose which evidence it wishes to submit in support of the claim, but as a minimum, it is advisable to have at least the following available:

• Copy of the Contract (including your Terms and Conditions)
• Copy Invoices/Credit Notes
• Proof of Delivery (CMR). - If there are no CMR documents signed by the debtor, an abstract from the accountancy book authenticated by a notary will suffice.
• An original power of attorney signed by the legal representative

Maintain comprehensive documentation for all business transactions. Ensure power of attorney is properly prepared and signed.

If there are no CMR documents signed by the debtor, an abstract from the accountancy book authenticated by a notary will suffice.

When included in trade contracts, retention of title allows the seller to retain ownership over the goods supplied until certain contractually defined conditions are met, providing the seller with a form of security against the buyer's default or insolvency.

Ensure retention of title clauses are clearly documented and registered where necessary. This provides additional protection against buyer insolvency.

To be enforceable, retention of title must be documented in writing and bear a date certain at law ('data certa'), which is obtained, for example, by way of notarisation. In the case of machines, retention of title must be registered at the office of the court's clerk in the jurisdiction where the machines are located, to be enforceable. For registered movable goods (such as cars, ships and airplanes), retention of title must be registered on the relevant register.

In addition, the retention of title previously agreed in writing by the seller and the buyer is effective against third-party creditors of the buyer if:

• The retention of title is confirmed in the individual sale invoices relating to successive supplies of goods.
• These invoices bear a date certain at law ('data certa') prior to any enforcement by third parties.
• These invoices have been regularly recorded in the accounting entries.

A warning notice to the debtor is mandatory before filing any enforcement claims. The warning notice should include:

• Creditor name and overview of the claim
• The total amount of the claim, including penalties (interest)
• Payment method required
• A warning that the claim will be enforced through the enforcement authority in case the claim is not settled by the required date
• Information on how to dispute the claim

Ensure a comprehensive warning notice is sent to the debtor before initiating legal proceedings. Follow up if payment is not received within the specified timeframe.

If this measure has been taken and the payment still has not been made after the two-week notice period (according to the law), the creditor may file for enforcement.

If the contracting parties have not agreed this in the contract, then statutory default interest and collection costs are applicable.

The creditor may in addition to the claim demand to recover from the debtor with a penalty interest of 8%.

Be aware of your rights to claim interest and collection costs on late payments, even if not specified in the contract.

The ordinary statute of limitation is 10 years.

Be aware of the different limitation periods for various types of claims. Act promptly to avoid exceeding these time limits.

In case of indemnification for torts, the statute is reduced to five years (two years for actions regarding the circulation of vehicles and ships). The five-year term also applies to actions for refunding interest or in corporate law matters.

B2B agreements of sale of goods, freight, shipment assurance and brokering commissions have a statute of limitation of one year.

The above terms are mandatory, and such terms start from the date on which the right may be exercised. In case of legal action, the statute of limitation is interrupted until the judgment, after which it starts to run again.

The most common ADR methods are private settlement, conciliation, mediation, and arbitration.

Consider ADR methods as potentially faster and more cost-effective alternatives to court proceedings. Be aware of specific rules and recent developments in arbitration procedures.

Although not enforced by law, mediation is sometimes indicated as a necessary step for certain cases such an optional mediation or judicial mediation as it is a cheaper and faster process than proceeding with any potential lawsuits and insolvency proceedings. An agreement issued by successful mediation is as enforceable as that of a judgment.

The parties could agree to entrust the dispute to an Arbitration hearing. For such an event, an arbitration clause must be included in any contracts. The arbitration must be convenient for both parties and managed by trusted arbitrators. Any awards (decisions) made by the arbitrators must pass the certification of the court in order to be effective between the parties.

On 1 July 2020, Italy's leading arbitral institution, the Milan Chamber of Arbitration, issued its new rules on the Simplified Arbitration Procedure. As clarified by the Milan Chamber itself, the newly introduced rules are aimed at providing users with a streamlined arbitration with reduced scales of fees.

The Italian judicial system adheres to a civil law system. For credit collections and cases concerning commercial law, one should reference the Italian Civil Code ('Codice Civile'), which contains and implements all the rules of commercial law, and Civil Action Code ('Codice di procedura Civile') which governs civil trials in Italy.

Understand the structure of the Italian judicial system, applicable laws, and court hierarchy based on claim value. Be prepared for potentially lengthy and expensive civil actions.

The judicial organisation foresees several kinds of judges, according to the amount of credit involved:

• Justice of the Peace (for values less than EUR 5,000)
• Tribunal (for values greater than EUR 5,000)

Legal action begins in the district court of the debtor or the location where the agreement was signed. Ordinary civil action is rarely used to collect credit founded on a written document such as an invoice.

Civil actions are lengthy processes, expensive and can last several years. The main purpose of the ordinary civil action is to determine what credit is due between parties. Should the credit be based on written documents, the law permits a faster and cheaper procedure called the summary judgment ('Decreto ingiuntivo'), which has limited intervention from a judge.

The average duration of legal action in Italy is ten to twelve months. An ordinary civil action case can take two to three years depending on the complexity of the case.

Be prepared for potentially lengthy legal processes and variable costs depending on the case complexity and debt value.

Court fees are EUR 125, however, all other costs are subject to the outstanding debt value, judge availability and expert individuals required.

Understand the potential costs involved in court proceedings, including court fees and additional costs based on the case specifics.

Before enforcing a local judgment, the creditor must:

• Ask the clerk's office of the court that issued the judgment to affix on the judgment a special stamp called "formula esecutiva" (this is the official order to the bailiff to enforce the judgment).
• Serve the debtor with a formal request to pay the amount due within a period of not less than ten days after the formal request is served.

In case of non-payment, the creditor can start enforcement proceedings by:

• Seizing the debtor's assets, including movable assets and real estate. These assets will then be auctioned under the judge's directions.
• Freezing the debtor's funds and/or credits owned by a third party. The judge will then allocate these funds and/or credits to the creditor.

Follow specific procedures for enforcing both domestic and foreign judgments. Be aware of the different requirements for EU and non-EU judgments.

The recognition and enforcement of EU judgments in Italy are governed by the Recast Brussels Regulation (1215/2012). No special procedures or declarations of enforceability are required. The applicant must provide:

• Copy of the judgment
• Document certifying that the judgment is enforceable, containing an extract of the judgment and relevant information on costs and interest
• A certified translation of both the judgment and certificate

The enforcement procedure is governed by Italian law.

Recognition and enforcement of non-EU judgments are governed by Law 218/1995. Requirements include:

• The court that issued the judgment was competent (including under Italian law)
• Fundamental defence rights have not been violated
• The decision is final and binding according to the applicable foreign laws

Recognition will be denied if there was a violation of due process, a contrary Italian decision exists, a proceeding is pending before an Italian court, or the judgment contradicts Italian legal principles.

To enforce a foreign judgment, interested parties must file with an Italian court:

• A certified copy of the judgment, duly apostilled (or legalised)
• A court certificate confirming the judgment is final and binding
• A certified Italian translation of the judgment and certificate

The enforcement procedure is governed by Italian law. These provisions may not apply if a specific convention exists between Italy and the issuing state.

• Two main types in Italy: Bankruptcy and Judicial Composition with Creditors.

In Italy, the main types of insolvency proceedings are bankruptcy ('fallimento') and judicial composition with creditors ('concordato preventivo').

Understand the different insolvency options in Italy. Be prepared for potentially lengthy processes in bankruptcy and judicial composition cases.

According to Italian law, small debtors such as individual shops and small-scale farmers cannot be declared bankrupt. Neither can small owner-managed firms where the personal work outweighs the value of the goods involved.

Low recovery for unsecured creditors.

• A creditor can ask for bankruptcy of the debtor if the credit is more than EUR 30,000, and the debtor has a minimum turnover of EUR 200,000.
• The debtor should also not have been removed from the Chamber of Commerce for more than one year.

After the check of all petitions filed at the court within the term fixed, the debt situation will be fixed with a judge's sentence, and the very long procedure of the liquidation of the bankrupt debtor's assets can take place.

To avoid bankruptcy, the debtor can ask the court directly to be admitted to the insolvency proceedings. The debtor's petition must include how much the debtor can pay to the creditors as a percentage of their debt. It is foreseen that the debtor has to offer at least 20% to the unsecured creditors.

Consider judicial composition as an option before bankruptcy. Monitor compliance with the reorganisation plan closely.

This offer must be approved by the majority of the creditors (in value of outstanding debt rather than the number of creditors) and should then be validated by the court. After, the insolvency practitioner starts to liquidate the assets according to the payment plan.