Italy has significantly tightened its foreign investment screening regime. Recent amendments to investment legislation have expanded both the scope of mandatory notification and the range of strategic sectors subject to government review. International companies that have not yet assessed their exposure face real risk of transaction suspension or reversal.
Italy's golden power (special government powers over strategic investments) regime now requires mandatory prior notification for acquisitions – including minority stakes – in an expanded list of strategic sectors. The amendments took effect in early 2025. Non-compliant transactions may be suspended, unwound, or subject to financial penalties under investment legislation.
This alert explains what changed, which business categories are affected, and the actions international companies must take before closing any affected transaction.
What changed – the regulatory development and effective date
Italy's golden power system has evolved significantly since its introduction. The most recent set of amendments broadened the sectors covered, lowered the ownership thresholds that trigger notification, and extended scrutiny to intra-EU transactions in sensitive areas.
Previously, mandatory notification applied primarily to acquisitions by non-EU investors in defence, energy, and communications infrastructure. The updated rules now cover a wider set of industries. These include advanced manufacturing, financial market infrastructure, and technology sectors with dual-use potential. Disclosure obligations now attach earlier in the transaction process.
The Italian government – acting through the Presidency of the Council of Ministers – retains authority to impose conditions, veto, or unwind transactions that threaten national security or public order. The review window following notification runs up to 45 working days, with a possible extension where the government requests additional information.
Critically, the threshold for triggering the obligation has been lowered. Acquisitions of stakes that confer influence over strategic decisions – even below formal control thresholds – now require pre-closing notification. This catches structures that previously fell outside the screening regime, including certain investment fund acquisitions and joint ventures.
Transactions involving securities offering activity or IPO-related restructurings in strategic sectors also warrant review. Where a listing or prospectus process results in a foreign acquirer crossing a relevant threshold, notification obligations apply independently of the capital markets process.
For detailed advice on capital markets transactions subject to Italian screening rules, see our practice page on capital markets law in Italy.
Who is affected – threshold criteria and business categories
The expanded regime catches a broader group of investors than most international deal teams anticipate. The following categories face the highest exposure.
Non-EU investors remain subject to the strictest requirements. Any acquisition of a stake conferring influence in a strategic Italian company requires prior notification, regardless of deal size.
EU-based investors are now also subject to mandatory notification in certain strategic sectors – specifically where the target operates in 5G communications, critical digital infrastructure, energy networks, or advanced defence supply chains. This is a significant departure from the regime as it operated before the amendments.
Investment fund structures face particular scrutiny where the ultimate beneficial ownership includes non-EU persons or where fund governance rights could allow a foreign state-linked entity to influence strategic decisions. Italian investment legislation looks through fund structures to assess real ownership and control.
The sectors attracting mandatory review now include: defence and dual-use technology. energy production, storage. Additionally. Distribution infrastructure. broadband and 5G networks. financial market infrastructure and payment systems. water and health infrastructure. and advanced manufacturing with security relevance.
Threshold criteria vary by sector. In the most sensitive categories, acquisition of any stake enabling influence – including through shareholders' agreements, veto rights, or board nomination rights – triggers the obligation. In other sectors, a specific ownership percentage threshold applies. Practitioners advising on Italian transactions consistently note that the low threshold design is intentional: the government seeks to capture influence rather than formal control.
For companies active in Italian banking and financial services, the notification requirements interact directly with financial sector supervisory rules. Our analysis of banking and finance law in Italy covers these intersecting obligations in detail.
To receive an expert assessment of your transaction's exposure under Italy's investment screening rules, contact us at info@ferrazwhitmore.com.
What to do now – immediate actions and compliance steps
International companies with pending or planned transactions in Italy should take the following steps without delay.
- Screen the target sector. Determine whether the Italian target operates in any of the expanded strategic categories. Do not rely on prior deal experience – the sector list has widened materially.
- Assess the ownership and influence structure. Map all rights the acquirer will hold post-closing, including governance rights, veto provisions, and any board representation. Even minority stakes with influence rights may trigger notification.
- Review fund and beneficial ownership layers. If acquiring through a fund vehicle, identify all persons with ultimate control or significant influence over investment decisions. Italian authorities look through structures and assess substance over form.
- File before closing, not after. Notification must be submitted prior to closing. Completing a transaction without notification – even where the parties believe screening is inapplicable – creates serious enforcement risk, including unwinding of the transaction.
- Build review time into the deal timeline. The government review period can extend beyond 45 working days. Deal schedules that do not account for this window carry a high risk of breach of contractual closing conditions.
Companies considering transactions that also involve a prospectus, IPO. Alternatively. Other securities offering in Italy should note that the disclosure obligations under capital markets legislation and the notification obligations under investment screening legislation operate on parallel tracks. Both must be satisfied. Failure to address either creates separate and distinct legal exposure.
Comparable screening developments in other EU markets – including Portugal – are addressed in our alert on investment screening in Portugal.
About Ferraz & Whitmore
Ferraz & Whitmore is an international law firm based in Lisbon, advising business clients across 46 jurisdictions. Our capital markets and foreign investment practice supports international acquirers, investment funds, and institutional investors in managing regulatory clearance processes across EU member states. We advise on Italian investment screening, listing requirements, and cross-border transaction structuring from a dual civil law and common law perspective. The firm's network covers regulatory bodies, financial market supervisors, and government advisory channels across 15 practice areas. Engaging a lawyer in Italy with cross-border expertise is particularly important where investment screening intersects with capital markets obligations. As an international law firm working across Italy and broader European markets, Ferraz & Whitmore helps clients build compliant transaction structures from the outset. To discuss your Italian investment or acquisition, contact us at info@ferrazwhitmore.com.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.