The number of entries allowed in Italy for non-EU entrepreneurs is regulated by the Flows Decree, which every year determines the quota of non-EU citizens entering Italy. Within the general quota established for entry into Italy for work purposes, the quota reserved for non-EU citizens who want to start a business in Italy in 2018 is 2,400. Admission for self-employment for 2,400 non-EU citizens residing abroad is envisaged for those belonging to the following categories:
- entrepreneurs who intend to implement an investment plan of interest to the Italian economy, which provides for the use of own resources of no less than 500,000 euros and from legitimate sources, as well as the creation of at least three new jobs;
- freelance professionals who wish to exercise regulated or supervised professions, or unregulated but represented at national level by associations registered in lists maintained by public administrations;
- holders of corporate administration and control positions expressly provided for by Interministerial Decree no. 850 of 11 May 2011;
- artists of known fame or outstanding and acknowledged professional qualification, hired by public or private bodies, in the presence of the requirements expressly provided for by Interministerial Decree no. 850 of 11 May 2011;
- foreign citizens who intend to set up “innovative startups” pursuant to Law no. 221 of 17 December 2012, in the presence of the requirements provided for by the said law and who have an employment relationship of an autonomous nature with the company.”
For the year 2018, the Flows Decree provided for the entry into Italy of 30,850 non-EU citizens. The quota reserved for non-EU citizens who intend to enter Italy for work purposes is 12,850. These include the quotas reserved for non-EU nationals who wish to apply for the conversion of residence permits already issued on another basis into a residence permit for employment and self-employment. The 12,850 quota for admission to Italy for work are broken down as follows:
- entry allowed for 500 non-EU foreign nationals residing abroad, who have completed training and education programmes in their countries of origin
- admission allowed for 100 workers of Italian origin on the side of at least one parent up to the third degree in direct line of descent, residing in Argentina, Uruguay, Venezuela and Brazil
- admission allowed for 4,750 residence permits for seasonal work; admission allowed for 3,500 residence permits for study, internships and/or professional training
- entry allowed for 800 long-term resident EU residence permits issued to nationals of third countries by another EU member state.
- conversion of 700 residence permits for study, internship and/or professional training into residence permits for self-employment
- conversion of 100 long-term resident EU residence permits issued to nationals of third countries by another EU member state into residence permits .
Entry into Italy for foreign entrepreneurs and the establishment of a company in Italy. Flows Decree and reciprocal agreements.
The Flows Decree is not the only legal instrument to open a company in Italy. According to Article 16 of the “Provisions on the Law in General”, contained in Royal Decree No. 262 of 16 March 1942, “A foreigner is allowed to enjoy the civil rights granted to a citizen on condition of reciprocity and subject to the provisions contained in special laws. This provision also applies to foreign legal persons.”
The condition of reciprocity is essential to open a branch of a foreign company in Italy, even without a residence permit. In fact, every business consultant in Italy knows that a foreign entrepreneur can open a company in Italy in 3 alternative ways:
- Opening of a branch with permanent representation
- Opening of a representative office
- Establishment of a subsidiary or a company or entity with legal autonomy
The reference legislation concerning the enjoyment of civil rights by foreign citizens is now set out in Legislative Decree no. 286 of 25 July 1998 (Consolidated Act on provisions concerning the regulation of immigration and rules on the condition of foreigners) and its implementing regulation (Decree of the President of the Republic No. 394 of 31 August 1999).
A regulatory condition that also applies to foreign investment
Investment means, irrespective of the legal form chosen and the relevant legal system, any asset invested by investors of one Contracting Party in the territory of the other Contracting Party, in accordance with the laws and regulations of the latter. The most common types of investment include: property rights on immovable and movable assets, and other property rights; monetary receivables and other consideration arising from contracts; acquisition of existing undertakings or shares in them; creation of new undertakings; copyright and industrial property rights; and legal concessions, such as those for the exploration, extraction and exploitation of natural resources. According to a constant interpretation, it is believed that the verification of the condition of reciprocity should not be carried out for the citizens of those countries with which Italy has concluded bilateral agreements on the promotion and protection of investments (Bilateral Investment Treaties, or BITs). Furthermore, in the case of the assumption of corporate offices, if not provided for in the agreements, the condition of reciprocity should be verified on a case-by-case basis. For the list of countries with which Italy has stipulated Investment Promotion and Protection Agreements and the main cases of their application click on List of countries
The international law firm Damiani & Damiani provides legal advice to start a business in Italy