Italy Update: Business crisis: responsibility of the directors of S.r.l.

Legislative Decree no. 83/2019 (Corporate Crisis Code)

Following the entry into force of the Corporate Crisis Code – from 5 July 2022 – the question arose whether the obligation to adopt an adequate organizational structure, for the purpose of timely detection of the state of crisis, placed on the directors of the S.r.l., entails the direct financial responsibility of the latter in the event of default.

Indeed, it must be emphasised that the obligation to have an organisational structure is attributed by law to the entrepreneur and not to the administrative body. However, it is also true that this obligation can be imposed on the director by the articles of association or by virtue of a precise delegation, but, even in this case, it must still derive and be demonstrated that the failure to detect a state of crisis in advance has, in itself, caused economic and financial damage to the company, in accordance with the provisions of Articles. 2392 and 2476 c.c.

Consequently, it can be argued that the lack or inadequate creation of an organisational structure for crisis prevention is not, in itself, sufficient to establish the responsibility of directors to intervene with their own capital to discharge corporate obligations. To that end, it must be demonstrated that any business crisis depended on a diversion of capital from the company by the directors, and that the failure to provide for an organisational structure for crisis prevention was preordained not to reveal their contribution to achieving it.

By Quorum, Italy, a Transatlantic Law International Affiliated Firm. 

For further information or for any assistance please contact italy@transatlanticlaw.com

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