CORPORATE
Liability of Shareholders in a Dissolved Corporation
With judgment no. 3625 of February 12, 2025, the United Sections of the Italian Supreme Court addressed a complex and highly significant issue for corporations: the liability of shareholders following the company’s cancellation from the Companies Register. According to Article 2495 of the Italian Civil Code, the cancellation of a company results in its dissolution; however, creditors who have not been satisfied may seek to recover their debts from the shareholders, up to the amounts received following the company’s liquidation. Additionally, under Article 36 of Presidential Decree 602/73, corporate income tax (IRES) shareholders who have received corporate assets during liquidation are liable for the taxes owed by the company, to the extent of the value of those assets.
The Court emphasized that, in the event of a company’s cancellation, tax proceedings do not terminate but are instead interrupted and must be resumed against the shareholders (in mandatory joinder) to ascertain their fiscal liability. Furthermore, the tax authorities must initiate a new assessment process rather than extending an existing tax claim against the dissolved company. This approach ensures that shareholder liability is not automatically inferred but must be established through a specific tax assessment formally notified to the shareholders.
Delay in Calling the Shareholders’ Meeting by Directors in Prolonged Office
With the order of January 17, 2025, the Milan Court clarified a crucial aspect regarding the role of directors in prolonged office and the role of the Board of Statutory Auditors in cases of unjustified delays in convening a shareholders’ meeting for the renewal of corporate offices. The Court emphasized that a significant and unjustified delay in convening the meeting—particularly when requested by a sole shareholder—may require the Board of Statutory Auditors to intervene under Article 2406, paragraph 1, of the Italian Civil Code. The omission by the directors was deemed “extremely serious” as it obstructed the sole shareholder’s right to appoint the new governing body, thereby impeding the shareholder’s ability to exercise direction and coordination over the company.
In such circumstances, the Court confirmed that intervention by the Board of Statutory Auditors is not only legitimate but necessary to ensure the proper functioning of corporate governance. This intervention does not infringe upon the division of powers among corporate bodies but rather serves as an independent corrective measure in response to the Board of Directors’ inertia.
Right of Partial Subscription of a Capital Increase in a Limited Liability Company (S.r.l.)
With an order dated February 10, 2025, the Brescia Court ruled that a shareholder’s right to subscribe to a capital increase in a limited liability company (S.r.l.), under Article 2481-bis of the Italian Civil Code, includes the right to partially subscribe to the offered shares. In this case, a minority shareholder contested a shareholders’ resolution aimed at reducing and subsequently reconstituting the company’s share capital. The shareholder argued that the resolution was based on the incorrect assumption of a capital loss and sought an interim measure to prevent the loss of their shareholder status, which would result from the company’s refusal to accept a partial subscription to the capital increase.
The Court highlighted that under the second paragraph of Article 2481-bis, the portion of the capital increase not subscribed by one or more shareholders may be subscribed by other shareholders or third parties. Additionally, the Court deemed it legitimate for the shareholder to seek an urgent measure under Article 700 of the Italian Code of Civil Procedure to secure registration in the Companies Register following the partial subscription. The Court considered this remedy more beneficial than judicial sequestration, as it ensured the shareholder’s immediate availability of the participation and full exercise of economic and patrimonial rights, whereas judicial sequestration would merely preserve the participation with a court-appointed custodian exercising the rights.
TAX
Deductibility of Directors-Shareholders’ Compensation
With order no. 5318/2025, the Italian Supreme Court established that compensation paid to directors-shareholders of a corporation is deductible for tax purposes only under specific conditions. In particular, the director-shareholder must be effectively subject to hierarchical, managerial, and disciplinary authority, and must perform duties distinct from those of a corporate officeholder.
The case originated from a challenge to a tax assessment issued by the Italian Revenue Agency, which disallowed the deduction of compensation paid to directors who also held employee status within the company. The Court emphasized that, while a director-shareholder can simultaneously be an employee, actual subordination must be demonstrated through genuine managerial oversight rather than merely through work schedules or regular salary payments. In the absence of a clear distinction between the functions of a director and those of an employee, the related cost cannot be considered deductible.
Waiver of Dividends and Legal Collection
In response to ruling request no. 59/2025, the Italian Revenue Agency addressed the issue of constructive receipt in cases where shareholders waive dividends that have already been declared but not yet distributed. The Agency clarified that when individual, non-business shareholders waive their dividend entitlements, the waived amount is not considered a taxable gain for the company but is instead treated as constructively received income by the shareholder. As a result, the 26% withholding tax under Article 27 of Presidential Decree 600/73 applies to the waived amount.
This interpretation contrasts with the prevailing doctrinal view, which considered the waived credit as having a fiscal value of zero, thereby generating a taxable gain for the company instead. The Agency’s position effectively subjects shareholders to immediate taxation on the waived dividends, reinforcing the principle that dividends, once declared, are taxable regardless of whether they are actually received.
RESPONSIBILITY UNDER LEGISLATIVE DECREE NO. 231/2001
Single-Member Companies and Corporate Criminal Liability
Single-member limited liability companies (S.r.l.) are subject to corporate criminal liability under Legislative Decree 231/2001. This principle is based on the legal personality of such entities, which distinguishes them from sole proprietorships that lack separate legal identity.
The Third Criminal Section of the Italian Supreme Court reaffirmed the well-established principle that corporate criminal liability applies to all entities with legal personality, including single-member companies, as they possess distinct assets, and organizational structures separate from the sole shareholder. This interpretation is grounded in Article 1, paragraph 2, of Legislative Decree 231/2001, which extends liability to entities that, although lacking legal personality, are distinct legal subjects.
The Court clarified that corporate criminal liability under Legislative Decree 231/2001 applies to single-member companies but excludes sole proprietorships, where no legal distinction exists between the owner and the business entity. This ruling reinforces the legal autonomy of single-member companies, underscoring their separation from the shareholder.
The Principle of Proportionality in Preventive Seizures of Companies
With order no. 2836 of January 23, 2025, the Sixth Criminal Section of the Italian Supreme Court reiterated the principle of proportionality in preventive seizures, ruling against the excessive application of such measures to a simple agricultural company. The Court overturned a lower court’s decision ordering the preventive seizure of corporate assets, bank accounts, and shares, emphasizing that such measures must not unjustifiably restrict property rights and economic freedom.
The principle of proportionality, enshrined in Article 275 of the Italian Code of Criminal Procedure, requires judges to tailor seizures strictly to what is necessary to prevent further harm. This principle applies not only at the time of seizure but throughout its duration, necessitating ongoing assessments of its necessity and adequacy.
Article 45 of Legislative Decree 231/2001 allows judges to impose precautionary measures when there is substantial evidence of an entity’s liability for administrative offenses linked to crimes, and a concrete risk of similar offenses occurring. Additionally, Article 34 of the same decree permits the preventive seizure of corporate assets if their continued availability could exacerbate the consequences of a crime or facilitate further offenses.
The Court emphasized that the seizure must be carefully calibrated, also taking into account positive factors such as the company’s income prospects or planned extraordinary operations. The ruling asserts that the judge must always find a proper balance between the need to protect precautionary interests and the respect for the entity’s fundamental rights, avoiding overly invasive measures that could irreversibly compromise the business’s economic activity.
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