Deed of incorporation and memorandum of association of companies in Italy
The "atto costitutivo" and "statute" of companies in Italy
The articles of association and bylaws of limited company
Content of the deed of incorporation
The content of the deed of incorporation is contained in art. 2328 of the civil code; the company can be established by contract or by unilateral act (for one shareholder s.r.l. or s.p.a.).
The deed of incorporation must be drawn up by public act (by a notary) and must indicate:
- the surname and first name or denomination (for a legal person), the date and place of birth or the state of incorporation (of the legal person), the domicile or headquarters, the citizenship of the shareholders and any promoters, as well as the number of shares assigned to each of them;
- the name and the municipality where the company headquarters and any secondary offices are located;
- the activity that constitutes the corporate object;
- the amount of the subscribed and paid-up capital;
- the number and any nominal value of the shares, their characteristics and the methods of issue and circulation;
- the value attributed to credits and assets transferred in kind;
- the rules according to which profits must be shared;
- any benefits granted to promoters or founding members;
- the administration system adopted, the number of directors and their powers, indicating which of them represent the company;
- the number of members of the board of statutory auditors;
- the appointment of the first directors and auditors or of the members of the supervisory board and, when required, of the person in charge of carrying out the statutory audit of the accounts;
- the total, at least approximate, amount of the formation expenses charged to the company;
- the duration of the company, or, if the company is established for an indefinite period, the period of time, in any case not exceeding one year, after which the shareholder may withdraw.
Content of the statute of s.r.l.
Article. 2328 of the Civil Code provides that: the statute contains the rules relating to the functioning of the company, even if it is a separate act, it forms an integral part of the deed of incorporation; in case of contrast between the clauses of the deed of incorporation and those of the statute, the latter prevail.
The statute of a s.r.l. is the key document for the work of the company, since through this are established the functioning rules of the company.
The deed of incorporation, together with the statute are essential for the establishment of a company, and without these two documents, the company will never be able to exist.
The deed of incorporation contains the information on the shareholders and the company necessary to set it up (e.g. the name of the s.r.l., the amount of the share capital, the data of each shareholder and the contributions made).
The deed of incorporation and the statute of an s.r.l. can also be used to open an "innovative startup", it is a particular type of limited company that produces and markets innovative goods and / or services with high technological value and benefits of some economic and fiscal incentives; the qualification of "innovative startup" is acquired only when all the requirements of the specific legislation are respected.
The simplified s.r.l. (s.r.l.s.) is characterized by lower incorporation costs but with some limitations (e.g. shareholders can be only natural persons and maximum tied capital), the statute can’t be customizable, but must be used a standard model prepared by the ministry (see note on s.r.l.s.).
The statute governs the corporate organization and contains the rules on administration, on the shareholders' meeting, on the transfer of shares, etc.
The typical contents of a statute of s.r.l. are as follows:
- registered office and duration of the company;
- corporate object of the company is mandatory, because it is addressed to third parties, the type of activity carried out is chosen on the basis of Ateco codes;
- share capital and quotas;
- rules concerning capital increase;
- shareholder loans to cover the company's needs;
- quotas for the shareholders 'meeting and for the majority of the shareholders' meeting;
- statement of the majorities for taking decisions in the shareholders meeeting; the majorities are generally 50% plus one of the represented capital, but the shareholders can also establish different majorities;
- chairmanship of the meeting and minutes;
- any proxies to other shareholders for participation in the meeting;
- provision on the possibility of holding the shareholders’ meeting by videoconference;
- administration of the company, management methods, duration, termination of the assignment, powers, fees, convocations, meetings;
- profits and dividends;
- board of statutory auditors and concerning remuneration, control by shareholders;
- auditor, concerning fees;
- indication if the shares of the shareholders are proportional or if there are shareholders with preferential shares which may include:
the power to appoint a director;
greater power in the meeting;
the possibility of celebrating assemblies only in the presence of one of the members, etc.;
- provide whether or not the transfer of company shares is possible; and
- if so, the statute must indicate whether the shareholders want the pre-emption clause to be present in the case of the sale of shares to third parties;
- if the pre-emption clause is provided, the other shareholders have the right to buy the shares that a shareholder wants to sell, before any other third party;
- must provide that in the event that the shares cannot be sold, the right of withdrawal is guaranteed to the shareholder;
- method of liquidating the shares;
- rules about dissolution and liquidation of the company;
- possibility of issuing bearer or registered debt securities;
- must indicate whether the heirs can enter the deceased's social quotas or not;
- may contain other clauses that allow the corporate statute to be adapted by the will of the shareholders;
- the indications of the statute must be precise, they cannot be generic and not even comprehensive to the point of being indeterminate, because the Register of Companies could reject it.