The notion of "listed companies" and “companies with widely distributed shares"

The Italian legal system provides for three different types of "joint-stock company": (i) listed companies, (ii) companies that issue shares held to a considerable extent by the general public (“companies with widely distributed shares”), and (iii) joint-stock companies that are not listed and do not resort to the risk capital market (so-called "closed companies").

However, since the introduction of the said classification in 2003, it has always been unclear what features a company must possess to fall under each of the above types. This uncertainty has had several operational repercussions, for instance with regards to the applicable provisions and the requirements to be met when taking minutes at meetings. In order to clarify the issue, the Milan Notary Council published the recommendation no. 206 of May 30, 2023 (the "Recommendation") with reference to the notion of (i) listed companies and (ii) Companies with widely distributed shares, both governed by Article 2325-bis of the Italian Civil Code. 

The notion of "listed companies" 

The Recommendation clarified that the provisions contained in Article 2325-bis of the Italian Civil Code, unlike those contained in Article 119 of Legislative Decree no. 198/1998 (“TUF”), also extend to companies with shares traded on regulated markets not belonging to the European Union or the European Economic Area, provided that those markets are comparable with the European ones. In this sense, the Recommendation clarified that it shall be deemed legitimate a statutory clause that, in order to facilitate the recognition of these companies, states that the listing market meets the requirements for Union-regulated markets, according to Article 4(1) para. 21 of Directive 2014/65/EU.  

The notion of "companies with widely distributed shares”  

The Recommendation highlighted that the notion given by Article 2325-bis of the Italian Civil Code is less extent than the one contained in Article 116 TUF as it includes joint-stock companies that, while not listed, comply with the positive and negative requirements set forth in Article 2-bis of Consob Regulation no. 11971/1999 (the “Regulation”), expressly referred to by Articles 111-bis of the “Relative Regulations” of the Italian Civil Code and Article 116 TUF. 

Consequently, the Recommendation stated that - in order to ascertain whether, for Italian Civil Code purposes, the shares of a joint-stock company are “widely distributed” - it should be taken into account the content of Article 2-bis of the Regulation, and not the publicity requirements set forth by Article 108, para. 2 and 5, of the Regulation. Article 2-bis of the Regulation, in particular, provides that "Italian joint-stock companies are Companies with widely distributed shares if, at the same time: a) they have shareholders other than controlling shareholders in a number of more than five hundred; b) the above-mentioned shareholders together hold a percentage of share capital of at least 5 percent; c) they exceed two of the three limits indicated in Article 2435-bis, para. 1, of the Italian Civil Code”.

By way of explanation, the Recommendation has validated a series of circumstances suitable to exclude the qualification as a Company with widely distributed shares. Ex multis, in case the company alternatively a) has one or more controlling shareholders holding more than 95 percent of the share capital; b) has a number of shareholders registered in the shareholders' register equal to 500 or less; c) has not exceeded in the last financial statements at least two of the three limits relating to abbreviated financial statements indicated in Article 2435-bis, para 1, of the Italian Civil Code.