The Firm recently advised an Italian company, wholly owned by a foreign holding company, on a business unit transfers in Italy (ramo d’azienda) carried out as part of a broader corporate reorganisation.
The transaction highlights the importance of understanding Italian business transfer law when foreign companies operate in Italy and engage in carve-out or disposal transactions governed by Italian civil law.
Under Italian law, the transfer of a business or business unit is a statutory transaction with effects that extend well beyond a traditional asset sale.
A business unit transfer involves the transfer of an organised and functionally autonomous business capable of carrying out an economic activity on an independent basis.
As a general rule, a transfer of business in Italy includes:
tangible and intangible assets forming part of the business unit;
ongoing commercial contracts connected with the transferred activity;
employees assigned to the business unit, with automatic continuation of employment relationships;
rights and certain liabilities related to the operation of the business.
Correctly defining the perimeter of the business unit is therefore essential to ensure consistency between the commercial objectives of the transaction and its legal consequences under Italian law.
A central aspect of the transaction was assisting the foreign parent company in navigating the mandatory rules of Italian civil law, which often differ significantly from common law frameworks.
In particular, Italian business transfer law provides for a number of effects that apply automatically by operation of law, including:
the automatic transfer of certain contracts without the need for individual counterparty consent, subject to statutory exceptions;
limitations on the contractual allocation of liability, with residual joint liability of the transferor vis-à-vis certain third parties;
extensive employee protection rules triggered by the transfer of a business or business unit;
formal execution and registration requirements that affect enforceability and third-party effectiveness.
For international groups accustomed to a more contract-driven approach, these constraints require early legal assessment and careful transaction planning.
The Firm provided hands-on legal support throughout the entire carve-out process, focusing on execution efficiency and risk management. In particular, the Firm:
advised on the non-waivable effects of a business unit transfer under Italian law;
supported the client in structuring the transaction in line with group strategy;
coordinated with foreign legal advisors and internal corporate stakeholders;
drafted and negotiated transaction documents fully compliant with Italian civil law requirements.
This pragmatic approach enabled the client to complete the transaction smoothly while mitigating legal, operational and post-closing risks.
The Firm regularly advises international groups, foreign investors and multinational corporations on:
transfers of business and business units in Italy;
carve-out transactions and corporate reorganisations;
cross-border M&A transactions governed by Italian law.
By combining strong technical expertise with a deep understanding of cross-border deal dynamics, the Firm acts as a reliable legal partner for foreign companies operating in Italy, translating business objectives into effective and compliant legal solutions.
For further information on business unit transfers in Italy or assistance with similar cross-border transactions, our team is available to support clients at every stage of the process.