• LATEST NEWS & INSIGHTS 15 September 2023

    Posted on: 15/09/2023




    Jurisprudence of merit already considered lawful the statutory or shareholders’ ‘anti-stall’ clause used to resolve situations of corporate paralysis. Recently, the court of legitimacy has also ruled after verifying some specific profiles of the clause’s regulatory compatibility and concluded that it is valid.


    In its judgment No. 22375 of July 25, 2023, the Supreme Court ruled for the first time on the legitimacy of the so-called ‘Russian roulette clause’ (also known as ‘cowboy clause or ‘anti-deadlock clause), i.e., the atypical clause – the result of the development of Anglo-Saxon legal systems and then gradually spreading into the contractual practice of civil law systems – sometimes inserted in the company’s bylaws or shareholders’ agreements to resolve situations of deadlock or decision-making paralysis of the company (so-called ‘dead-lock’ clause), due to the fact that the company’s shares or holdings are owned by two partners, each holding 50 percent.


    The clause, in short, makes it possible to prevent and/or resolve the decision-making deadlock (of the administrative body or the shareholders’ meeting) by means of a predetermined procedure under which each of the shareholders – in order to get out of an impasse that could lead to the impossibility of functioning and the initiation of the liquidation of the company – has the option to make an irrevocable and alternative offer to sell its shareholding to the other shareholder or to buy the other shareholder’s shareholding, communicating its economic valuation of the entire share capital and thus in terms of percentage the price of the shareholding being offered or sold.


    At that point, the shareholder receiving the offer can either accept the offer of others on the proposed terms or purchase the bidder’s shareholding at the proposed price.


    There are some specific variants of the anti-stall clause: for example, the ‘asymmetrical’ one (i.e., with only one of the partners being given the right to activate the procedure and determine the price) and the clause that provides for the so-called relaunch,’ i.e., the possibility for the bidding partner to relaunch if the partner receiving the first bid decides to buy.


    The judges of merit who have so far ruled on the validity of the clause have considered it lawful because it does not conflict with any mandatory norms of the legal system and indeed responds to interests worthy of protection, being aimed at resolving a decision-making paralysis resulting from the disagreement among the equal partners which, if protracted, would jeopardize the very survival of the company (Art. 2484 c.c. in fact identifies among the causes of dissolution of corporations “the impossibility of functioning” and “continued inactivity” of the shareholders’ meeting”).


    The Councils of Notaries (e.g., of Milan and Florence) have also expressed themselves in favor of the legitimacy of the statutory Russian roulette clause, even independently of the provision of a mechanism for predetermining the price of the shareholding being transferred. It would not be essential, therefore, to also provide in the clause the criteria according to which the bidding shareholder must value the participation being offered, nor would it be necessary to provide that the price be or not be at least equal to the value that can be determined at the time of withdrawal: the fact that the same shareholder may find himself in the situation of having to buy or sell the participation at the same price ensures that the consideration is valued by the parties as fairly and congruously as possible.


    Finally (and for the first time), the Court of Cassation ruled, which had been asked to assess the legality of the clause following two rulings (by the Court and the Court of Appeal of Rome) both favoring the validity of the clause (in the case at hand, the clause was contained in a shareholders’ agreement and one of the shareholders participating in the shareholders’ agreement, losing in the first instance had appealed to the court of legitimacy, in the belief that the anti-stall clause was not lawful).


    The Supreme Court examined the validity of the clause under multiple profiles of potential regulatory incompatibility.


    It first ruled out a conflict between the clause and the Civil Code rule (Art. 1355 Civil Code) that sanctions with nullity the contractual clause of alienation of a right or the assumption of an obligation subject to a merely potestative condition (i.e., that makes the effects of the clause depend on the merely arbitrary will of the contractor): in the case of an anti-stall clause, a merely potestative condition would not be configurable since the offeror does not set the price at his mere arbitrary will (having to take into account the risk of the recipient’s final decision), and can activate the procedure only upon the occurrence of a corporate impasse, which the clause must predetermine and which, by definition, should not depend on his behavior alone (in this light, the clause must well qualify the concept of impasse and its prerequisites and determine the temporal scope and exact operation).


    According to the Supreme Court, moreover, the anti-stall clause does not conflict with the principles on the determination of the object of a contract (Article 1349 of the Civil Code), since it is the recipient (not the bidder, who has determined. the value of the shareholding) who makes the choice between selling and buying.


    Nor does the clause violate the prohibition of a lion agreement in Article 2265 of the Civil Code (according to which an agreement between shareholders having the function of totally excluding one of them from participation in profits or losses is null and void): in fact, the anti-stall clause does not have the immediate operability of a lion’ agreement because it does not entail the absolute exclusion of a shareholder from participation in profits and/or from bearing losses. It depends on a deadlock that is only eventual and, moreover, may be to the detriment of the same party that started the procedure.


    As to the possible conflict of the clause with the principle of equitable valuation of the shareholding and fair determination of the value of the share of the departing shareholder, the Supreme Court, in order to exclude incompatibility, differentiated the anti-stall clause from other clauses (e.g., the ‘drag along’ clause) for which the legislature has established the need to adopt criteria for determining the value of the shareholding prepared for the case of withdrawal or redemption: unlike the drag along clause (where it is necessary to indicate a minimum value of the shareholding), for example, in the Russian roulette clause, the shareholders have equal participation and there is no need to protect the minority shareholder.


    On these articulated statements, the Supreme Court finally concluded for the validity of the Russian roulette clause contained in the bylaws or in a shareholders’ agreement, specifying that the clause must be used without abuse, that is, according to the principle of fairness and good faith: there would be abuse, for example, if there was an obvious informational or financial imbalance between the shareholders or if the situation of paralysis was not effective or was the result of purely instrumental and obstructive behavior of one shareholder and the clause was used only to force the other shareholder to leave the company (all cases in which the wronged shareholder could seek compensation for the damages suffered as a result of the unfair ouster from the company or inhibit the application of the clause and have the deed of transfer of the shareholding declared ineffective).









    In a ruling dated 22 June 2023, the Court of Milan focused on the substantive differences and on procedural solutions that distinguish fiduciary registration of shares and fictitious interposition of a person in the ownership thereof.


    In a ruling dated 22 June 2023, the Companies Section of the Court of Milan highlighted the substantial differences and the different procedural solutions that distinguish fiduciary registration of shares and fictitious interposition of persons.


    In this case before the Court, a party:


    – alleged that it had registered company shares in trust in the name of a third party;

    – complained that upon request for subsequent re-transfer of the shares, the third party failed to do so;

    and, consequently,

    – asked the Court of Milan to ascertain and declare its capacity as the beneficial owner of the shareholding and to order the company to immediately transcribe the said shareholding in the Company Register (with the consequent reduction of the shareholdings formally held by third parties).


    The Court of Milan rejected the application, without entering into the merits of the dispute, applying the criterion of the ‘most enforceable grounds’ and recalling – in this regard – the indications of the Court of Cassation on the differences between fiduciary registration of shares and fictitious interposition of persons (and consequent remedies available in court).


    According to the judges of legitimacy, in fact, “the apparent attribution of the right of ownership to a person other than the person who intends to retain its effective availability may occur either by fictitious interposition, falling within the scheme of the simulated transaction, or by real interposition, instrumental or not with respect to a trust transaction.”


    However, whereas in a fictitious interposition there is a manifestation of a transaction that differs from the one actually intended (a so-called simulated contract), with the understanding that it is ineffective, in the case of a fiduciary registration there is the real interposition of a third party with a legal transaction that must be considered valid and effective, albeit on the assumption that the contracting party is obliged to make a further transfer in favor of the actual beneficiary of the relationship (Court of Cassation, Sec. II, 20/07/2020, no. 15385).


    In accordance with this indication, the Court of Milan therefore rejected the claim, pointing out that in the case in question it was the same plaintiff that had confirmed the operation of the shares’ registration in the hands of third parties as “fiduciary” and could not, therefore, accept the request for the mere verification of the shareholder’s role proposed by the plaintiff since “the transfer by a trust deed entails a real transfer of ownership of the shares, with the addition of a commitment to their re-transfer” and “the only way to regain the shares, subsisting all the prerequisites, is to act pursuant to Art. 2932 of the Civil Code“, i.e. by a constitutive action aimed at obtaining a judgment in lieu of the non-concluded re-transfer agreement.


    Having presented a fiduciary registration of shares (and not a fictitious interposition of a person), the plaintiff could not therefore declare to be (and be declared by the Court) the owner of the shares, but – in view of the completion of a real and effective legal transaction in favor of third party ‘trustees’ – should have acted to obtain a ruling on the formal transfer of the same in its favor.


    In conclusion, according to an old saying, the details make the difference, but the difference is not a detail.









    The new provisions, which incorporate the decisions of EU and national case law, include some clarification as well as some new elements.


    As correctly already highlighted in the “Report to the Code of Contracts of the Council of State“, in the old public procurement code (Legislative Decree No. 50/2016) in force, most of the litigation was developed on the rules concerning general requirements (Art. 80). This is because article 80 , although adopted largely from the text of art. 57 of Directive no. 24/2014, did not actually distinguish the exclusion causes between the so-called “mandatory” (that is, those that were applied directly, without the contracting authority being left with any margin of appreciation on the existence of the conditions) compared to the so-called “optional” causes for exclusion.


    By issuing this new procurement code, the legislator introduced a specific framework, in certain respects clarifying, dividing the original provision (ex art. 80) into five distinct articles (from 94 to 98) of which – with regard to the non-payment of taxes and duties or social security contributions – the most relevant are articles numbers 94 and 95 (paragraph 4 of article 80 on the other hand grouped both a mandatory cause of exclusion, and a so-called “optional” one, having the same “reason”: failure to pay taxes, social security contributions).


    The new code identifies two distinct causes for the same case: one included among the “automatic” exclusions (Art. 94 paragraph 6) and the other (Art. 95 paragraph 2) among the “non-automatic” ones, these cases being defined in Annex II.10 to the procurement code, in which essentially, also in consideration of the amount, a distinction is made between the cases in which the violation has been “definitively ascertained” and those in which the ascertainment is not definitive.


    A) in particular, Article 94, on the basis of numerous decisions of the Court of Justice and national case law, provides for specific grounds for exclusion from the tender, distinguishing them with the adjective “automatic” when more serious.

    The serious violations of tax and social security obligations, which constitute an automatic cause for exclusion, fully reproduce the very recent Ministerial Decree of 22 September 2022, issued in implementation of art. 80, paragraph 4, of the current Legislative Decree no. 50/2016, as amended by art. 10, paragraph 1, letter c), n. 2, of Law no. 238 of 23 December 2021 (“European Law 2019-2020”).


    B) As mentioned above, Article 95 alternatively governs the “non-automatic” causes of exclusion (the previous code regulated them under paragraph 5 of art. 80, in line with the decisions adopted repeatedly by Community and national caselaw: ref. Council of State, plenary session, 27 May 2021, no. 9).


    If we compare the “old provision” provided under the second part of paragraph 4 of art. 80 of Legislative Decree no. 50/2016 with the “new provision” established in paragraph 2 of art. 95 of Legislative Decree no. 36/2023, in substance the framework relating to the non-automatic cause of exclusion deriving from the failure to pay taxes and duties or social security contributions has not changed. And in fact the recent Ministerial Decree of 28 September 2022 containing “provisions on the possible exclusion of the economic operator from the participation in a procurement procedure for serious breach in tax matters not definitively ascertained” have been included under Annex II.10 of the code.


    In realty, upon closer examination there is a new element which can be identified in the last indent of paragraph 2 of art. 95. In fact, where previously it was provided (and is still provided) that the paragraph does not apply when the economic operator has fulfilled its obligations by paying or undertaking in a binding manner to pay the taxes or social security contributions due, a further type of operation of the provision has been added, provided that the exclusion does not operate: namely: “in the event that the economic operator has offset the tax debt with certified claims against the public administration“.









    The Supreme Court, with decision no. 25690 of September 4, 2023, rejected the refund claim of taxes paid in Italy by a well-known AC Milan player who moved to Paris Saint-Germain in 2012.


    The player moved to France in the second part of the tax period, assuming tax residence in France with immediate effect.


    In France, unlike in Italy, tax residence is integrated from the moment of transfer, even if the stay in that tax period is less than half of the period itself. On the contrary, in Italy residence for tax purposes is assessed over the entire tax period with the consequence that an individual who has met the requirements for tax residence for more than 183 days in a year is considered resident for tax purposes for the entire year.


    The different criteria of the various the States on the matter of residence easily creates situations in which the taxpayer, following a transfer of residence, is considered a resident of two States for part of the tax period. In these situations, the Commentary on the OECD Model Tax Convention suggests applying the tie breaker rules to single fractions of the tax period.


    The well-known football player in 2012 met the requirements for tax residence in Italy for 199 days and therefore – for Italian tax purposes – was resident in Italy for the entire tax period. For this reason he reported in its Italian tax return all the income received during the year. However, he then submitted a refund claim for the taxes paid in Italy on income earned after the transfer to France, arguing that the conflict of residence between Italy and France should be resolved by splitting the tax period pursuant to the Italy-France Convention, as interpreted in the light of the OECD Model and its Commentary.


    The appeal was rejected by the Supreme Court, which considered the suggestion made in the OECD Commentary non-binding and stated that double taxation must be resolved by crediting in France, pursuant to the Italy-France Convention, the taxes paid in Italy. Moreover, according to the Supreme Court, the existence of the tax credit mechanism excludes any criticism of the Italian legislation for violation of the fundamental freedoms established by the TFEU.


    The decision of the Supreme Court is in line with the approach of the Revenue Agency which since its resolution no. 471/2008 had always denied the possibility of splitting the tax period in all cases where this is not expressly provided for in the relevant double taxation agreement (this is the case of the tax treaties with Germany and Switzerland).









    The Italian Data Protection Authority recently fined an insurance agency for not having acted properly in in managing the email accounts of two former employees, who filed a complaint with the Garante. The Authority initiated an inspection as a result of which, the agency was fined.


    In the course of the inspection activities conducted by the Garante, the agency defended itself by claiming that it had promptly notified IVASS (the insurance regulator) of the employees’ resignations and also blocked the two accounts, which were then deactivated in the following 120 days. According to the agency, this activity was necessary to ensure business continuity. For this purpose, the agency had noted that the address could receive emails, which were automatically redirected to a “sorting manager,” who was then forwarding them to new account managers.


    Later, the agency further clarified that:


    – the agency had adopted a policy governing the use of company IT resources, and that the relevant document, had been provided to all employees and contractors;

    – there was no access in the accounts, as the block was ordered without entering the accounts, and Aruba, the service provider, was guaranting the IT security;

    – in addition to the redirection to the sorting manager, the agency was confirming that it was not possible to retrieve any correspondence or documents, as there was no backup;

    – an automated message was entered informing customers of the change of manager within the agency;

    – the recording and preservation, without time limitation, of the logs of the e-mail system, as well as the contents of the mailbox and other assigned resources, were carried out for reasons related to the company’s business.


    The Guarantor, because of its inspection activities and having examined the agency’s defenses, confirmed the violation of the legislation on the protection of personal data, and in particular of Articles 5 and 6 of the GDPR. In this regard, the Guarantor has, preliminarily, noted how the statements were unclear and contradictory to each other (e.g., first it was assured that the accounts were blocked, but later the agency itself admitted that the person in charge was sorting messages to other employees).


    In conclusion, The Guarantor found that:


    – accounts were kept active for 120 days after termination, and during that period e-mails were automatically forwarded to a manager. This period was considered excessive, both because the agency claimed to have informed clients in 30 days and because IVASS indicated a maximum of 7 days to indicate the new agent to the customer;

    – no evidence was produced of the automated message to clients, nor that the person in charge could not actually access the content of the emails, a circumstance belied by the documents in the record (in any case, even the “external data” of an email, such as sender and subject, constitute personal data).


    The Guarantor specifies that “It follows that the employer, after the termination of the [employment] relationship, must provide for the removal of the individualized business e-mail account, after deactivating it and simultaneously adopting automatic systems aimed at informing third parties and providing them with alternative addresses, thus avoiding the viewing of incoming communications on the individualized account assigned to the person concerned.


    Second, the Guarantor confirmed the non-legitimacy of the sine die retention of the logs and contents of corporate accounts. The agency, in fact, did not produce any evidence regarding the lack of backups mentioned above and in general the existence of a specified retention period.


    In this regard, the Guarantor recalled its guidance on the preservation of corporate e-mail, reiterating that “the legitimate need to ensure the preservation of documents necessary for the ordinary course and continuity of business … is ensured, first, by the provision of document management systems with which through the adoption of appropriate organizational and technological measures identify the documents that in the course of the business must be gradually archived ….. Electronic mail systems, by their very nature, do not make it possible to ensure such characteristics“.


    The Guarantor issued a fine of 5,000 euros and ordered the agency to bring its corporate regulations into compliance.


    Corporate account management is a hotly debated and topical issue, and a compliant system can certainly be a solid defence in the event of inspection activities by authorities.






    DISCLAIMER: This newsletter merely provides general information and does not constitute legal advice of any kind from Macchi di Cellere Gangemi. The newsletter does not replace individual legal consultation. Macchi di Cellere Gangemi assumes no liability whatsoever for the content and correctness of the newsletter.




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