Doing Business 2018 Italy Economy Pro le of Italy Doing Business 2018 Indicators (in order of appearance in the document) Starting a business Procedures, time, cost and paid-in minimum capital to start a limited liability company Dealing with construction Procedures, time and cost to complete all formalities to build a warehouse and the quality control and permits safety mechanisms in the construction permitting system Getting electricity Procedures, time and cost to get connected to the electrical grid, the reliability of the electricity supply and the transparency of tariffs Registering property Procedures, time and cost to transfer a property and the quality of the land administration system Getting credit Movable collateral laws and credit information systems Protecting minority investors Minority shareholders’ rights in related-party transactions and in corporate governance Paying taxes Payments, time and total tax rate for a firm to comply with all tax regulations as well as post-filing processes Trading across borders Time and cost to export the product of comparative advantage and import auto parts Enforcing contracts Time and cost to resolve a commercial dispute and the quality of judicial processes Resolving insolvency Time, cost, outcome and recovery rate for a commercial insolvency and the strength of the legal framework for insolvency Labor market regulation Flexibility in employment regulation and aspects of job quality About Doing Business The Doing Business project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle. Doing Business captures several important dimensions of the regulatory environment as it applies to local rms. It provides quantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Doing Business also measures features of labor market regulation. Although Doing Business does not present rankings of economies on the labor market regulation indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business, it does present the data for these indicators. By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more e cient regulation; o ers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy. In addition, Doing Business o ers detailed subnational reports, which exhaustively cover business regulation and reform in di erent cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that Doing Business has ranked. The rst Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This year’s report covers 11 indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has bene ted from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world. Page 2   for insolvency Doing Business Labor market 2018 regulation Italy Flexibility in employment regulation and aspects of job quality About Doing Business The Doing Business project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle. Doing Business captures several important dimensions of the regulatory environment as it applies to local rms. It provides quantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Doing Business also measures features of labor market regulation. Although Doing Business does not present rankings of economies on the labor market regulation indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business, it does present the data for these indicators. By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more e cient regulation; o ers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy. In addition, Doing Business o ers detailed subnational reports, which exhaustively cover business regulation and reform in di erent cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that Doing Business has ranked. The rst Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This year’s report covers 11 indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has bene ted from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world. The distance to frontier (DTF) measure shows the distance of each economy to the “frontier,” which represents the best performance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economy’s distance to frontier is re ected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents the frontier. The ease of doing business ranking ranges from 1 to 190. The ranking of 190 economies is determined by sorting the aggregate distance to frontier scores, rounded to two decimals. More about Doing Business (PDF, 5MB) Ease of Doing Business in Region OECD high income DB 2018 Rank 190 1 Italy Income Category High income 46 Population 60,600,590 DB 2018 Distance to Frontier (DTF) GNI Per Capita (US$) 31,590 0 100 72.70 City Covered Rome DB 2018 Distance to Frontier (DTF) 0 100 79.00: Germany (Rank: 20) 77.46: Regional Average (OECD high income) 77.02: Spain (Rank: 28) 75.92: Switzerland (Rank: 33) 72.70: Italy (Rank: 46) Page 3   71.69: Belgium (Rank: 52) aggregate distance to frontier scores, rounded to two decimals. More Doingabout 2018 (PDF, Doing Business Business Italy5MB) Ease of Doing Business in Region OECD high income DB 2018 Rank 190 1 Italy Income Category High income 46 Population 60,600,590 DB 2018 Distance to Frontier (DTF) GNI Per Capita (US$) 31,590 0 100 72.70 City Covered Rome DB 2018 Distance to Frontier (DTF) 0 100 79.00: Germany (Rank: 20) 77.46: Regional Average (OECD high income) 77.02: Spain (Rank: 28) 75.92: Switzerland (Rank: 33) 72.70: Italy (Rank: 46) 71.69: Belgium (Rank: 52) Note: The distance to frontier (DTF) measure shows the distance of each economy to the “frontier,” which represents the best performance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economy’s distance to frontier is re ected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents the frontier. The ease of doing business ranking ranges from 1 to 190. Rankings on Doing Business topics - Italy 1 1 23 24 28 28 55 66 62 82 96 Rank 105 108 112 109 136 163 190 Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Investors Borders Permits Distance to Frontier (DTF) on Doing Business topics - Italy 100.00 100 89.42 85.27 81.70 80 76.97 67.26 68.29 58.33 60 54.79 DTF 45.00 40 20 0 Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Change:+5.33 Change:+0.01 Change:0.00 Investors Change:+5.64 Borders Change:0.00 Change:+0.38 Change:+0.02 Permits Change:0.00 Change:0.00 Change:+0.13 Starting a Business Page 4   This topic measures the paid-in minimum capital requirement, number of procedures, time and cost for a small- to medium-sized a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Change:+5.33 Change:+0.01 Change:0.00 Investors Change:+5.64 Borders Change:0.00 Change:+0.38 Change:+0.02 Permits Change:0.00 Change:0.00 Doing Business 2018 Italy Change:+0.13 Starting a Business This topic measures the paid-in minimum capital requirement, number of procedures, time and cost for a small- to medium-sized limited liability company to start up and formally operate in economy’s largest business city. To make the data comparable across 190 economies, Doing Business uses a standardized business that is 100% domestically owned, has start-up capital equivalent to 10 times income per capita, engages in general industrial or commercial activities and employs between 10 and 50 people one month after the commencement of operations, all of whom are domestic nationals. Starting a Business considers two types of local limited liability companies that are identical in all aspects, except that one company is owned by 5 married women and the other by 5 married men. The distance to frontier score for each indicator is the average of the scores obtained for each of the component indicators. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to legally start and operate a To make the data comparable across economies, several assumptions company (number) about the business and the procedures are used. It is assumed that any required information is readily available and that the entrepreneur will pay Pre-registration (for example, name verification no bribes. or reservation, notarization) Registration in economy’s largest business city The business: - Is a limited liability company (or its legal equivalent). If there is more than Post-registration (for example, social security one type of limited liability company in the economy, the most common registration, company seal) among domestic rms is chosen. Information on the most common form is Obtaining approval from spouse to start business obtained from incorporation lawyers or the statistical o ce. or leave home to register company - Operates in the economy’s largest business city and the entire o ce Obtaining any gender-specific permission that space is approximately 929 square meters (10,000 square feet). For 11 can impact company registration, company economies the data are also collected for the second largest business city. operations and process of getting national - Is 100% domestically owned and has ve owners, none of whom is a legal identity card entity; and has a start-up capital of 10 times income per capita and has a Time required to complete each procedure turnover of at least 100 times income per capita. (calendar days) - Performs general industrial or commercial activities, such as the production or sale of goods or services to the public. The business does Does not include time spent gathering not perform foreign trade activities and does not handle products subject information to a special tax regime, for example, liquor or tobacco. It does not use Each procedure starts on a separate day (2 heavily polluting production processes. procedures cannot start on the same day) - Leases the commercial plant or o ces and is not a proprietor of real Procedures fully completed online are recorded estate and the amount of the annual lease for the o ce space is equivalent as ½ day to 1 times income per capita. Procedure is considered completed once final - Does not qualify for investment incentives or any special bene ts. document is received - Has at least 10 and up to 50 employees one month after the commencement of operations, all of whom are domestic nationals. No prior contact with officials - Has a company deed 10 pages long. Cost required to complete each procedure (% of The owners: income per capita) - Have reached the legal age of majority. If there is no legal age of majority, Official costs only, no bribes they are assumed to be 30 years old. No professional fees unless services required by - Are sane, competent, in good health and have no criminal record. law or commonly used in practice - Are married and the marriage is monogamous and registered with the authorities. Paid-in minimum capital (% of income per capita) - Where the answer di ers according to the legal system applicable to the Funds deposited in a bank or with third party woman or man in question (as may be the case in economies where there before registration or up to 3 months after is legal plurality), the answer used will be the one that applies to the incorporation majority of the population. Standardized Company Page 5   before registration or up to 3 months after is legal plurality), the answer used will be the one that applies to the incorporation majority of the population. Doing Business 2018 Italy Standardized Company Legal form Società a responsabilità limitata (Srl) Paid-in minimum capital requirement EUR 1 City Covered Rome OECD high OECD high Indicator Italy income income Overall Best Performer Procedure – Men (number) 6 4.9 4.9 1.00 (New Zealand) Time – Men (days) 6.5 8.5 8.5 0.50 (New Zealand) Cost – Men (% of income per capita) 13.7 3.1 3.1 0.00 (United Kingdom) Procedure – Women (number) 6 4.9 4.9 1.00 (New Zealand) Time – Women (days) 6.5 8.5 8.5 0.50 (New Zealand) Cost – Women (% of income per capita) 13.7 3.1 3.1 0.00 (United Kingdom) Paid-in min. capital (% of income per capita) 0.0 8.7 8.7 0.00 (113 Economies) Figure – Starting a Business in Italy and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 94.43: Belgium (Rank: 16) 91.35: Regional Average (OECD high income) 89.42: Italy (Rank: 66) 88.38: Switzerland (Rank: 73) 86.65: Spain (Rank: 86) 83.46: Germany (Rank: 113) Note: The ranking of economies on the ease of starting a business is determined by sorting their distance to frontier scores for starting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Starting a Business in Italy – Procedure, Time and Cost Time Cost 12 6 10 ost (% of income per capita) 5 8 4 Time (days) 6 3 4 2 Page 6   starting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Italy Figure – Starting a Business in Italy – Procedure, Time and Cost Time Cost 12 6 10 Cost (% of income per capita) 5 8 4 Time (days) 6 3 4 2 1 2 0 0 1 *2 *3 4 5 6 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Details – Starting a Business in Italy – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Execute a public deed of incorporation and company bylaws before a 1 day 0.6%-1.4% of the public notary and pay registration tax company’s start-up Agency : Notary Public capital (notary fees) + EUR 200 A public deed of incorporation (atto costitutivo), including the company’s (registration fee) + bylaws (statuto), must be drafted and executed before a public notary by the EUR 156 (stamp quota holders or their authorized representatives. The notary drafts duty). company bylaws pursuant to legal provisions governing limited liability company (Srl) governed by Article 2463 of the Italian Civil Code. The cost of the forms and stamp duties, as well as the registration tax, due within 20 days of incorporation, is paid to the notary public. The Government of Italy adopted the Law no. 140/2012 that eliminated the xed notary fees, but still maintains the notary fee guidance as percentage of company's share capital. In addition to the notary fee, companies pay registration fee and stamp duty. The registration fee is regulated by the Presidential Decree no. 131/1986 and the stamp duty is regulated by the Presidential Decree no. 642/1972. As of 20 July 2016, deed of incorporation and company bylaws can be executed without the assistance of a Notary Public for "innovative startups". In order to qualify as "innovative startup", the company needs to have, among other things, as exclusive/predominant corporate purpose, provision of "innovative services". The said documents are executed on the basis of standards provided by the Ministry of Economic Development and is possible through the platform provided on the website startup.registroimprese.it. Page 7   (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Doing Business 2018 Italy Details – Starting a Business in Italy – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Execute a public deed of incorporation and company bylaws before a 1 day 0.6%-1.4% of the public notary and pay registration tax company’s start-up Agency : Notary Public capital (notary fees) + EUR 200 A public deed of incorporation (atto costitutivo), including the company’s (registration fee) + bylaws (statuto), must be drafted and executed before a public notary by the EUR 156 (stamp quota holders or their authorized representatives. The notary drafts duty). company bylaws pursuant to legal provisions governing limited liability company (Srl) governed by Article 2463 of the Italian Civil Code. The cost of the forms and stamp duties, as well as the registration tax, due within 20 days of incorporation, is paid to the notary public. The Government of Italy adopted the Law no. 140/2012 that eliminated the xed notary fees, but still maintains the notary fee guidance as percentage of company's share capital. In addition to the notary fee, companies pay registration fee and stamp duty. The registration fee is regulated by the Presidential Decree no. 131/1986 and the stamp duty is regulated by the Presidential Decree no. 642/1972. As of 20 July 2016, deed of incorporation and company bylaws can be executed without the assistance of a Notary Public for "innovative startups". In order to qualify as "innovative startup", the company needs to have, among other things, as exclusive/predominant corporate purpose, provision of "innovative services". The said documents are executed on the basis of standards provided by the Ministry of Economic Development and is possible through the platform provided on the website startup.registroimprese.it. 2 Purchase corporate and accounting books 1 day EUR 16 stamp fee for Agency : Notary or Register of Enterprises (Registro delle Imprese) (simultaneous with each 100 pages (3 previous books), EUR 25 According to Article 2478 of the Italian Civil Code, a limited liability company procedure) registration fee per (Srl) must keep the following corporate books: a minute book of board of book (3 books) directors’ meetings, a minute book of quota-holders’ meetings, and if appointed, a minute book of board of Statutory Auditors’ (Collegio Sindacale) meetings. All are subject to authentication. The minute book of Auditors’ meetings is required only if the company: drafts consolidated nancial statements, or controls companies that are subject to external audit, or, if for two consecutive scal years it exceeds two of the following: it’s total assets on the balance sheet of Euro 4,400,000 or more, it’s pro ts from sales and activities of Euro 8,800,000, or more, total number of sta of 50 or more in a course of one nancial year. According to Article 2214 of the Italian Civil Code, any business must also keep two accounting books: the journal book and the inventory book. Authentication of the accounting books is not required. All books are available in standard format at stationery stores or through a notary public. However, entrepreneurs can also use a loose-leaf book at no additional cost. Since 2009, business founders have had the option to keep all corporate books and accounting books in electronic format. In this case, a digital time stamp and electronic signature must be put on the books Page 8   possible through the platform provided on the website Doing startup.registroimprese.it. Business 2018 Italy 2 Purchase corporate and accounting books 1 day EUR 16 stamp fee for Agency : Notary or Register of Enterprises (Registro delle Imprese) (simultaneous with each 100 pages (3 previous books), EUR 25 According to Article 2478 of the Italian Civil Code, a limited liability company procedure) registration fee per (Srl) must keep the following corporate books: a minute book of board of book (3 books) directors’ meetings, a minute book of quota-holders’ meetings, and if appointed, a minute book of board of Statutory Auditors’ (Collegio Sindacale) meetings. All are subject to authentication. The minute book of Auditors’ meetings is required only if the company: drafts consolidated nancial statements, or controls companies that are subject to external audit, or, if for two consecutive scal years it exceeds two of the following: it’s total assets on the balance sheet of Euro 4,400,000 or more, it’s pro ts from sales and activities of Euro 8,800,000, or more, total number of sta of 50 or more in a course of one nancial year. According to Article 2214 of the Italian Civil Code, any business must also keep two accounting books: the journal book and the inventory book. Authentication of the accounting books is not required. All books are available in standard format at stationery stores or through a notary public. However, entrepreneurs can also use a loose-leaf book at no additional cost. Since 2009, business founders have had the option to keep all corporate books and accounting books in electronic format. In this case, a digital time stamp and electronic signature must be put on the books annually. The cost to register electronic books depends on Ministerial Decree from June 17, 2014. 3 Pay government tax (fee) to authenticate corporate and accounting 1 day EUR 309.87 (if the books (simultaneous with capital is under EUR Agency : Tax Revenues Authority (Agenzia delle Entrate) previous 516,456.90) or EUR procedure) 516.46 (if the capital Government tax (fee) is assessed by the O ce of Revenue to authenticate exceeds EUR corporate and accounting books (tassa di concessione governativa). The 516,456.90) initial payment is paid at the time of incorporation via a postal service (bollettino postale). Subsequent annual payments are transmitted electronically by F24 form. 4 Activation and Registration of the P.E.C (i.e. the “Certi ed e-mail”) 1 day EUR 50 Agency : Email service providers Under Italian Law Decree No. 185 of 29 November 2008, all companies are required to have a certi ed e-mail (PEC ). Said requirement is immediate and must be communicated to the Companies’ Register throughout the relevant incorporation procedure. Failure to communicate PEC results in a suspension of the registration process in the Companies’ Register. 5 Register company incorporation, and receive tax identi cation number, 2 days EUR 100 VAT number, and register with Social Security Administration (INPS) and (membership fees) + Accident Insurance O ce (INAIL) EUR 90 (registration Agency : Register of Enterprises (Registro delle Imprese) fee with chamber of commerce) Applicants must electronically le a single notice (Comunicazione Unica) with the Register of Enterprises, which will automatically register the company for tax identi cation number, VAT number, and process the company with Social Security Administration (INPS) and Accident Insurance O ce (INAIL). The applicant must attach the forms requested by the Register of Enterprises for the registration, the Italian Tax Authorities for immediate starting of Page 9   business, and by INPS and INAIL for the registration with these incorporation procedure. Failure to communicate PEC results in a Business of Doing suspension the registration 2018 Italy process in the Companies’ Register. 5 Register company incorporation, and receive tax identi cation number, 2 days EUR 100 VAT number, and register with Social Security Administration (INPS) and (membership fees) + Accident Insurance O ce (INAIL) EUR 90 (registration Agency : Register of Enterprises (Registro delle Imprese) fee with chamber of commerce) Applicants must electronically le a single notice (Comunicazione Unica) with the Register of Enterprises, which will automatically register the company for tax identi cation number, VAT number, and process the company with Social Security Administration (INPS) and Accident Insurance O ce (INAIL). The applicant must attach the forms requested by the Register of Enterprises for the registration, the Italian Tax Authorities for immediate starting of business, and by INPS and INAIL for the registration with these Administrations. Immediately upon registration, the company receives a reference number for the registration procedure, the receipt of the ling of the Single Notice, the tax identi cation number and the VAT number. The company receives con rmation of registration with the Register of Enterprises typically within 48 hours, though technically the procedure can take as long as 5 business days. The company receives INAIL documentation and INPS documentation within a few hours of registration. The company will receive all notices, communications, and receipts of ling at the Company’s certi ed email address. 6 Notify the competent Labor O ce (DPLMO) of the employment of Less than one day no charge workers (online procedure) Agency : Competent Employing O ce (Centro per l’impiego) Business founders must notify the Territorial Labor O ce (Direzione Territoriale del Lavoro, DTL) about hiring personnel one day before the employee in question begins working at their company. Registration can be done online through the portal called Bussola at the following website: http://co.provincia.roma.it/colrm/ Applies to women only. Takes place simultaneously with previous procedure. Dealing with Construction Permits This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, submitting all required noti cations, requesting and receiving all necessary inspections and obtaining utility connections. In addition, the Dealing with Construction Permits indicator measures the building quality control index, evaluating the quality of building regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professional certi cation requirements. The most recent round of data collection was completed in June 2017. See the methodology for more information What the indicators measure Case study assumptions Procedures to legally build a warehouse (number) To make the data comparable across economies, several assumptions about the construction company, the warehouse project and the utility Submitting all relevant documents and obtaining connections are used. all necessary clearances, licenses, permits and certificates The construction company (BuildCo): Submitting all required notifications and - Is a limited liability company (or its legal equivalent) and operates in the Page 10   receiving all necessary inspections economy’s largest business city. For 11 economies the data are also Applies to women only. Takes place simultaneously with previous procedure. Doing Business 2018 Italy Dealing with Construction Permits This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, submitting all required noti cations, requesting and receiving all necessary inspections and obtaining utility connections. In addition, the Dealing with Construction Permits indicator measures the building quality control index, evaluating the quality of building regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professional certi cation requirements. The most recent round of data collection was completed in June 2017. See the methodology for more information What the indicators measure Case study assumptions Procedures to legally build a warehouse (number) To make the data comparable across economies, several assumptions about the construction company, the warehouse project and the utility Submitting all relevant documents and obtaining connections are used. all necessary clearances, licenses, permits and certificates The construction company (BuildCo): Submitting all required notifications and - Is a limited liability company (or its legal equivalent) and operates in the receiving all necessary inspections economy’s largest business city. For 11 economies the data are also collected for the second largest business city. Obtaining utility connections for water and - Is 100% domestically and privately owned; has ve owners, none of whom sewerage is a legal entity. Has a licensed architect and a licensed engineer, both Registering and selling the warehouse after its registered with the local association of architects or engineers. BuildCo is completion not assumed to have any other employees who are technical or licensed Time required to complete each procedure experts, such as geological or topographical experts. (calendar days) - Owns the land on which the warehouse will be built and will sell the warehouse upon its completion. Does not include time spent gathering information The warehouse: Each procedure starts on a separate day— - Will be used for general storage activities, such as storage of books or though procedures that can be fully completed stationery. online are an exception to this rule - Will have two stories, both above ground, with a total constructed area of Procedure is considered completed once final approximately 1,300.6 square meters (14,000 square feet). Each oor will document is received be 3 meters (9 feet, 10 inches) high and will be located on a land plot of No prior contact with officials approximately 929 square meters (10,000 square feet) that is 100% owned by BuildCo, and the warehouse is valued at 50 times income per capita. Cost required to complete each procedure (% of - Will have complete architectural and technical plans prepared by a warehouse value) licensed architect. If preparation of the plans requires such steps as Official costs only, no bribes obtaining further documentation or getting prior approvals from external Building quality control index (0-15) agencies, these are counted as procedures. - Will take 30 weeks to construct (excluding all delays due to administrative Sum of the scores of six component indices: and regulatory requirements). Quality of building regulations (0-2) The water and sewerage connections: Quality control before construction (0-1) - Will be 150 meters (492 feet) from the existing water source and sewer Quality control during construction (0-3) tap. If there is no water delivery infrastructure in the economy, a borehole Quality control after construction (0-3) will be dug. If there is no sewerage infrastructure, a septic tank in the smallest size available will be installed or built. Liability and insurance regimes (0-2) - Will have an average water use of 662 liters (175 gallons) a day and an Professional certifications (0-4) average wastewater ow of 568 liters (150 gallons) a day. Will have a peak water use of 1,325 liters (350 gallons) a day and a peak wastewater ow of 1,136 liters (300 gallons) a day. - Will have a constant level of water demand and wastewater ow throughout the year; will be 1 inch in diameter for the water connection and 4 inches in diameter for the sewerage connection. Standardized Warehouse Page 11   and 4 inches in diameter for the sewerage connection. Doing Business 2018 Italy Standardized Warehouse Estimated value of warehouse EUR 1,382,429.20 City Covered Rome OECD high OECD high Indicator Italy income income Overall Best Performer Procedures (number) 12 12.5 12.5 7.00 (Denmark) Time (days) 227.5 154.6 154.6 27.5 (Korea, Rep.) Cost (% of warehouse value) 3.6 1.6 1.6 0.10 (5 Economies) Building quality control index (0-15) 11.0 11.4 11.4 15.00 (3 Economies) Figure – Dealing with Construction Permits in Italy and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 78.16: Germany (Rank: 24) 75.36: Belgium (Rank: 39) 75.14: Regional Average (OECD high income) 71.73: Switzerland (Rank: 62) 67.26: Italy (Rank: 96) 63.50: Spain (Rank: 123) Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their distance to frontier scores for dealing with construction permits. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Dealing with Construction Permits in Italy – Procedure, Time and Cost Time Cost 3 200 2.5 Cost (% of warehouse value) 150 2 Time (days) 1.5 100 1 50 0.5 0 0 1 *2 *3 4 5 6 7 8 *9 * 10 11 12 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Page 12   component indicators. Doing Business 2018 Italy Figure – Dealing with Construction Permits in Italy – Procedure, Time and Cost Time Cost 3 200 2.5 Cost (% of warehouse value) 150 2 Time (days) 1.5 100 1 50 0.5 0 0 1 *2 *3 4 5 6 7 8 *9 * 10 11 12 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Dealing with Construction Permits in Italy and comparator economies – Measure of Quality 14 12.0 12 11.0 11.0 11.4 9.5 10 9.0 Index score 8 6 4 2 0 Italy Belgium Germany Spain Switzerland OECD high income Details – Dealing with Construction Permits in Italy – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Obtain nulla osta from the Regional Technical O ce (Genio Civile) 30 days EUR 1,275 Agency : Regional Technical O ce (Genio Civile) Under the Lazio Regional Regulation no. 2 of February 7, 2012, since January 1, 2013, the application to obtain the seismic authorization shall be done online by using the so-called SITAS system. The applications delivered by hand are not accepted. The Regional O ce “Genio Civile” checks for the compliance of the project with the technical provisions set forth by the competent administration through an internal control committee and issues the seismic authorization. This authorization is mandatory for the building permit to be valid. Page 13   Structural projects are randomly selected for control in the rst ten days of Italy Belgium Germany Spain Switzerland OECD high income Doing Business 2018 Italy Details – Dealing with Construction Permits in Italy – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Obtain nulla osta from the Regional Technical O ce (Genio Civile) 30 days EUR 1,275 Agency : Regional Technical O ce (Genio Civile) Under the Lazio Regional Regulation no. 2 of February 7, 2012, since January 1, 2013, the application to obtain the seismic authorization shall be done online by using the so-called SITAS system. The applications delivered by hand are not accepted. The Regional O ce “Genio Civile” checks for the compliance of the project with the technical provisions set forth by the competent administration through an internal control committee and issues the seismic authorization. This authorization is mandatory for the building permit to be valid. Structural projects are randomly selected for control in the rst ten days of the month following application. Projects that are not selected are automatically authorized. However, the applicant must wait until a formal letter of seismic approval is received. The letter arrives approximately within two weeks. For projects selected for control, the procedure lasts at least 60 days. 2 Obtain geo-technical study of the land 15 days EUR 2,000 Agency : Private licensed company A soil test is a necessary step for development of the project. The soil investigation helps to determine the bearing capacity of the land, which helps to determine the load capability, the type and depth of foundation, in order to make sure to select a suitable construction technique. 3 Obtain topographic survey of the land plot 15 days EUR 1,000 Agency : Private licensed company A topographic survey of the land plot must be obtained prior to developing the architectural plans of the warehouse. 4 Obtain building permit 135 days EUR 38,661 Agency : Municipal Agency The application for a building permit is led with the Sportello Unico dell'Edilizia (one-stop shop). BuildCo must le proof of title of ownership to the property for which the building permit is requested, as well as the project design drawings signed by an engineer or an architect, including the drawings relating to electric utilities, air conditioning systems, and re protection devices. The SUE will also request project clearance from the Fire Department and from the Public Health Agency. The minimum term required for the issue of the building permit is 90 days (where the applicant has submitted all the correct documents and the competent agency has not asked for integration of documents and/or small variations to the project). In practice, if there are requests for variation/integration, the Municipality Agency takes more days to issue the building permit. The fees for the issuance of the building permit are calculated based on the building value and on the urbanization costs sustained by the municipality. The fee based on building value must be paid no later than 60 days after the completion of the building; the fee based on urbanization costs must be paid upon issuance of the building permit. Page 14   A topographic survey of the land plot must be obtained prior to developing Doing the architectural Business 2018 plans of the warehouse. Italy 4 Obtain building permit 135 days EUR 38,661 Agency : Municipal Agency The application for a building permit is led with the Sportello Unico dell'Edilizia (one-stop shop). BuildCo must le proof of title of ownership to the property for which the building permit is requested, as well as the project design drawings signed by an engineer or an architect, including the drawings relating to electric utilities, air conditioning systems, and re protection devices. The SUE will also request project clearance from the Fire Department and from the Public Health Agency. The minimum term required for the issue of the building permit is 90 days (where the applicant has submitted all the correct documents and the competent agency has not asked for integration of documents and/or small variations to the project). In practice, if there are requests for variation/integration, the Municipality Agency takes more days to issue the building permit. The fees for the issuance of the building permit are calculated based on the building value and on the urbanization costs sustained by the municipality. The fee based on building value must be paid no later than 60 days after the completion of the building; the fee based on urbanization costs must be paid upon issuance of the building permit. The Law Decree no. 70 of May 13, 2011 has introduced the "consent by silent" for issuing of building permits. Speci cally, in case of silence by the Municipality Agency to reply within the deadline indicated by law, the entrepreneur is entitled to start construction activities (unless there are restrictions on the land/building for historical, landscape or cultural reasons). For complex projects, the Municipality Agency must reply within 150 days from the receipt of the application (such time does not consider any extension of time necessary for any request of integration or changes to the project by the competent o ce). 5 Hire an independent engineer to test structure 1 day EUR 6,000 Agency : Authorized Independent Engineer The structure tests must be performed by an engineer or an architect who was not directly involved in the project. In addition to the nal test on completed structures, the work site director must provide test results for the structural material used to build the structure. In the case of reinforced concrete, the testing must be done on three samples taken on each day that concrete is poured and on one sample for each steel per le used in the structure. The testing is based on per les traction and compression resistance and must be done by an authorized testing lab. 6 File certi ed noti cation of starting activity (“SCIA”) 0.5 days EUR 216 Agency : Fire Department A certi ed noti cation of starting activity (“SCIA”) is a declaration produced by BuildCo that the building is in compliance with all re safety regulations. For a warehouse containing books, the cost will be EUR 216.00 as per the D.P.R. 151/11 (Presidential Decree 151/11 of August 1, 2011. See activity No. 34.1.B for warehouses containing books). 7 Receive on-site inspection by the Fire Department 1 day no charge Agency : Fire Department 8 Obtain occupancy certi cate 30 days EUR 468 Agency : Municipal Agency Page 15   Within 15 days of the building’s completion, the builder should le with the 7 Receive on-site inspection by the Fire Department 1 day no charge Agency : Fire Department Doing Business 2018 Italy 8 Obtain occupancy certi cate 30 days EUR 468 Agency : Municipal Agency Within 15 days of the building’s completion, the builder should le with the Municipal Agency an application for an occupancy certi cate and: • The request for cadastral registration • The builder's statement attesting the compliance of the building with the project speci cations and the favorable outcome of the Fire Department’s inspection • Statements of the independent experts involved in Procedure 3 • The conformity certi cate issued by the Regional Technical O ce The Municipal Agency issues the occupancy certi cate within 30 days after the application is led. 9 Register the building 5 days EUR 159 Agency : Land Registry and Cadastral O ce Within 15 days of the completion of the building, the builder shall le for the registration at the SUE. BuildCo has to submit a request for the registration together with the documentation necessary to obtain the occupancy certi cate. The SUE shall send the request for registration and the supporting documents to the Cadastral Registry which will complete the registration. Apply for water and sewerage connection 1 day no charge 10 Agency : Rome Water Company (ACEA SpA) BuildCo shall contact the water authority to obtain the water and sewage connection. 11 Receive on-site inspection and estimation of water and sewerage 1 day no charge installation costs Agency : Rome Water Company (ACEA SpA) 12 Obtain water and sewerage connection 29 days EUR 600 Agency : Rome Water Company (ACEA SpA) Takes place simultaneously with previous procedure. Details – Dealing with Construction Permits in Italy – Measure of Quality Answer Score Building quality control index (0-15) 11.0 Quality of building regulations index (0-2) 2.0 How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0 Free of charge; They must be purchased. Which requirements for obtaining a building permit are clearly speci ed in the building List of required 1.0 regulations or on any accessible website, brochure or pamphlet? (0-1) documents; Fees to be paid; Required Page 16   preapprovals. Takes place simultaneously with previous procedure. Doing Business 2018 Italy Details – Dealing with Construction Permits in Italy – Measure of Quality Answer Score Building quality control index (0-15) 11.0 Quality of building regulations index (0-2) 2.0 How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0 Free of charge; They must be purchased. Which requirements for obtaining a building permit are clearly speci ed in the building List of required 1.0 regulations or on any accessible website, brochure or pamphlet? (0-1) documents; Fees to be paid; Required preapprovals. Quality control before construction index (0-1) 0.0 Which third-party entities are required by law to verify that the building plans are in By law, there is 0.0 compliance with existing building regulations? (0-1) no need to verify plans compliance; Civil servant reviews plans. Quality control during construction index (0-3) 2.0 What types of inspections (if any) are required by law to be carried out during Inspections by 1.0 construction? (0-2) in-house engineer; Inspections by external engineer or rm; Inspections at various phases. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 1.0 inspections are always done in practice. Quality control after construction index (0-3) 3.0 Is there a nal inspection required by law to verify that the building was built in Yes, external 2.0 accordance with the approved plans and regulations? (0-2) engineer submits report for nal inspection. Do legally mandated nal inspections occur in practice? (0-1) Final inspection 1.0 always occurs in practice. Liability and insurance regimes index (0-2) 2.0 Which parties (if any) are held liable by law for structural aws or problems in the Architect or 1.0 Page 17   building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1) engineer; Liability Doing 2018 regimes and insurance Business Italy index (0-2) 2.0 Which parties (if any) are held liable by law for structural aws or problems in the Architect or 1.0 building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1) engineer; Professional in charge of the supervision; Construction company; Owner or investor. Which parties (if any) are required by law to obtain an insurance policy to cover Architect or 1.0 possible structural aws or problems in the building once it is in use (Latent Defect engineer; Liability Insurance or Decennial Insurance)? (0-1) Professional in charge of the supervision; Construction company; Insurance is commonly taken in practice. Professional certi cations index (0-4) 2.0 What are the quali cation requirements for the professional responsible for verifying There are no 0.0 that the architectural plans or drawings are in compliance with existing building speci c regulations? (0-2) requirements. What are the quali cation requirements for the professional who supervises the Minimum 2.0 construction on the ground? (0-2) number of years of experience; University degree in engineering, construction or construction management; Being a registered architect or engineer. Getting Electricity This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally, the reliability of supply and transparency of tari s index measures reliability of supply, transparency of tari s and the price of electricity. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to obtain an electricity connection To make the data comparable across economies, several assumptions are (number) used. Submitting all relevant documents and obtaining The warehouse: all necessary clearances and permits - Is owned by a local entrepreneur and is used for storage of goods. Completing all required notifications and - Is located in the economy’s largest business city. For 11 economies the receiving all necessary inspections data are also collected for the second largest business city. Page 18   Obtaining external installation works and possibly - Is located in an area where similar warehouses are typically located and is architect or engineer. Doing Business 2018 Italy Getting Electricity This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally, the reliability of supply and transparency of tari s index measures reliability of supply, transparency of tari s and the price of electricity. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to obtain an electricity connection To make the data comparable across economies, several assumptions are (number) used. Submitting all relevant documents and obtaining The warehouse: all necessary clearances and permits - Is owned by a local entrepreneur and is used for storage of goods. Completing all required notifications and - Is located in the economy’s largest business city. For 11 economies the receiving all necessary inspections data are also collected for the second largest business city. Obtaining external installation works and possibly - Is located in an area where similar warehouses are typically located and is purchasing material for these works in an area with no physical constraints. For example, the property is not Concluding any necessary supply contract and near a railway. obtaining final supply - Is a new construction and is being connected to electricity for the rst time. Time required to complete each procedure - Has two stories with a total surface area of approximately 1,300.6 square (calendar days) meters (14,000 square feet). The plot of land on which it is built is 929 Is at least 1 calendar day square meters (10,000 square feet). Each procedure starts on a separate day Does not include time spent gathering The electricity connection: information - Is a permanent one with a three-phase, four-wire Y connection with a subscribed capacity of 140-kilo-volt-ampere (kVA) with a power factor of 1, Reflects the time spent in practice, with little when 1 kVA = 1 kilowatt (kW). follow-up and no prior contact with officials - Has a length of 150 meters. The connection is to either the low- or Cost required to complete each procedure (% of medium-voltage distribution network and is either overhead or income per capita) underground, whichever is more common in the area where the Official costs only, no bribes warehouse is located and requires works that involve the crossing of a 10- meter road (such as by excavation or overhead lines) but are all carried out Value added tax excluded on public land. There is no crossing of other owners’ private property The reliability of supply and transparency of because the warehouse has access to a road. tari s index (0-8) - Does not require work to install the internal wiring of the warehouse. This has already been completed up to and including the customer’s service Duration and frequency of power outages (0–3) panel or switchboard and the meter base. Tools to monitor power outages (0–1) Tools to restore power supply (0–1) The monthly consumption: Regulatory monitoring of utilities’ performance - It is assumed that the warehouse operates 30 days a month from 9:00 (0–1) a.m. to 5:00 p.m. (8 hours a day), with equipment utilized at 80% of capacity Financial deterrents limiting outages (0–1) on average and that there are no electricity cuts (assumed for simplicity reasons) and the monthly energy consumption is 26,880 kilowatt-hours Transparency and accessibility of tariffs (0–1) (kWh); hourly consumption is 112 kWh. Price of electricity (cents per kilowatt-hour)* - If multiple electricity suppliers exist, the warehouse is served by the Price based on monthly bill for commercial cheapest supplier. warehouse in case study - Tari s e ective in March of the current year are used for calculation of the price of electricity for the warehouse. Although March has 31 days, for * N o t e : Doing Business m e a s u r e s t h e p r i c e o f calculation purposes only 30 days are used. electricity, but it is not included in the distance to frontier score nor the ranking on the ease of getting electricity. Page 19   Standardized Connection frontier score nor the ranking on the ease of getting electricity. Doing Business 2018 Italy Standardized Connection Price of electricity (US cents per kWh) 20.2 Name of utility Areti City Covered Rome OECD high OECD high Indicator Italy income income Overall Best Performer Procedures (number) 4 4.7 4.7 2 (United Arab Emirates) Time (days) 82 79.1 79.1 10 (United Arab Emirates) Cost (% of income per capita) 156.5 63.0 63.0 0.00 (Japan) Reliability of supply and transparency of tariff 7 7.4 7.4 8.00 (28 Economies) index (0-8) Figure – Getting Electricity in Italy and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 98.79: Germany (Rank: 5) 94.41: Switzerland (Rank: 7) 85.27: Italy (Rank: 28) 84.44: Regional Average (OECD high income) 82.99: Spain (Rank: 42) 67.30: Belgium (Rank: 103) Note: The ranking of economies on the ease of getting electricity is determined by sorting their distance to frontier scores for getting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Getting Electricity in Italy – Procedure, Time and Cost Time Cost 120 80 70 100 Cost (% of income per capita) 60 80 50 Time (days) 40 60 30 40 20 20 10 Page 20   getting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Italy Figure – Getting Electricity in Italy – Procedure, Time and Cost Time Cost 120 80 70 100 Cost (% of income per capita) 60 80 50 Time (days) 40 60 30 40 20 20 10 0 0 1 *2 3 4 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Getting Electricity in Italy and comparator economies – Measure of Quality 8.2 8 8 8 8 7.8 7.6 Index score 7.4 7.4 7.2 7 7 7 6.8 6.6 6.4 Italy Belgium Germany Spain Switzerland OECD high income Details – Getting Electricity in Italy – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Submit application and await estimate 30 calendar days EUR 0 Agency : Areti The application submitted by the client must include: a. Application request form (available for downloading on Areti website) b. Certi cation of compliance with building normative (available for downloading on Areti website) c. Technical speci cation of the plant d. Electrical map of the plant d. Land registry extract of the site with the location of the plant Deeds authenticated by notary acts are not requested Page 21   Italy Belgium Germany Spain Switzerland OECD high income Doing Business 2018 Italy Details – Getting Electricity in Italy – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Submit application and await estimate 30 calendar days EUR 0 Agency : Areti The application submitted by the client must include: a. Application request form (available for downloading on Areti website) b. Certi cation of compliance with building normative (available for downloading on Areti website) c. Technical speci cation of the plant d. Electrical map of the plant d. Land registry extract of the site with the location of the plant Deeds authenticated by notary acts are not requested 2 Receive external site inspection by utility 15 calendar days EUR 13,261.75 Agency : Areti Technical conditions include: a. Preliminary Minimal Technical Solution (STMG) –Arieti sends this document to the end-user demanding the payment of the costs associated with the preliminary technical analysis (STMG) b. Detailed Minimal Technical Solution (STMD) – Ariete determines the conditions of the connection Once the customer has accepted the pre-emption and paid the related costs, Arieti provides the necessary authorizations and plans the activities (commit works to an external contractor, provisioning materials, etc.). 3 Purchase and install secondary transformer 7 calendar days EUR 30,000 Agency : Electrical Contractor The customer's electrical contractor is responsible for setting up his own secondary transformer station (which has to provide the energy transformation from medium voltage to low voltage), the MV cable connection from Acea feeding station to the Client station, as well as the complete realization of the low voltage end-user plant. The cost of a secondary transformer station and of the MV cable connection depends on the Technical Solution of the installation. 4 Obtain external works from utility, meter installation and electricity 45 calendar days EUR 0 ow Agency : Areti Utility obtains the necessary authorization for the road works from the competent local authority and carries out external connection works. From the connection point at the medium voltage distribution grid to the compartment for the feeding of the customer in the secondary transformer station, including the measuring apparatus, all the materials are provided and maintained by Acea. Takes place simultaneously with previous procedure. Page 22   Details – Getting Electricity in Italy – Measure of Quality Takes place simultaneously with previous procedure. Doing Business 2018 Italy Details – Getting Electricity in Italy – Measure of Quality Answer Reliability of supply and transparency of tari index (0-8) 7 Total duration and frequency of outages per customer a year (0-3) 2 System average interruption duration index (SAIDI) 0.5 System average interruption frequency index (SAIFI) 1.5 What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 3.0 Mechanisms for monitoring outages (0-1) 1 Does the distribution utility use automated tools to monitor outages? Yes Mechanisms for restoring service (0-1) 1 Does the distribution utility use automated tools to restore service? Yes Regulatory monitoring (0-1) 1 Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on Yes reliability of supply? Financial deterrents aimed at limiting outages (0-1) 1 Does the utility either pay compensation to customers or face nes by the regulator (or both) if outages Yes exceed a certain cap? Communication of tari s and tari changes (0-1) 1 Are e ective tari s available online? Yes Link to the website, if available online http://www.aceaspa.i t/section.aspx/it/tari e#.Vd3l1yV3mUl Are customers noti ed of a change in tari ahead of the billing cycle? Yes Note: If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tari index. If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index. If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Page 23   What the indicators measure Case study assumptions Takes place simultaneously with previous procedure. Doing Business 2018 Italy Details – Getting Electricity in Italy – Measure of Quality Answer Reliability of supply and transparency of tari index (0-8) 7 Total duration and frequency of outages per customer a year (0-3) 2 System average interruption duration index (SAIDI) 0.5 System average interruption frequency index (SAIFI) 1.5 What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 3.0 Mechanisms for monitoring outages (0-1) 1 Does the distribution utility use automated tools to monitor outages? Yes Mechanisms for restoring service (0-1) 1 Does the distribution utility use automated tools to restore service? Yes Regulatory monitoring (0-1) 1 Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on Yes reliability of supply? Financial deterrents aimed at limiting outages (0-1) 1 Does the utility either pay compensation to customers or face nes by the regulator (or both) if outages Yes exceed a certain cap? Communication of tari s and tari changes (0-1) 1 Are e ective tari s available online? Yes Link to the website, if available online http://www.aceaspa.i t/section.aspx/it/tari e#.Vd3l1yV3mUl Are customers noti ed of a change in tari ahead of the billing cycle? Yes Note: If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tari index. If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index. If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Page 24   What the indicators measure Case study assumptions If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Doing Business 2018 Italy Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to legally transfer title on immovable To make the data comparable across economies, several assumptions property (number) about the parties to the transaction, the property and the procedures are used. Preregistration procedures (for example, checking for liens, notarizing sales agreement, The parties (buyer and seller): paying property transfer taxes) - Are limited liability companies (or the legal equivalent). Registration procedures in the economy's largest - Are located in the periurban area of the economy’s largest business city. business citya. For 11 economies the data are also collected for the second largest Postregistration procedures (for example, filling business city. title with municipality) - Are 100% domestically and privately owned. Time required to complete each procedure - Have 50 employees each, all of whom are nationals. (calendar days) - Perform general commercial activities. Does not include time spent gathering information The property (fully owned by the seller): - Has a value of 50 times income per capita, which equals the sale price. Each procedure starts on a separate day - though - Is fully owned by the seller. procedures that can be fully completed online - Has no mortgages attached and has been under the same ownership for are an exception to this rule the past 10 years. Procedure is considered completed once final - Is registered in the land registry or cadastre, or both, and is free of title document is received disputes. No prior contact with officials - Is located in a periurban commercial zone, and no rezoning is required. Cost required to complete each procedure (% of - Consists of land and a building. The land area is 557.4 square meters property value) (6,000 square feet). A two-story warehouse of 929 square meters (10,000 square feet) is located on the land. The warehouse is 10 years old, is in Official costs only (such as administrative fees, good condition, has no heating system and complies with all safety duties and taxes). standards, building codes and legal requirements. The property, Value Added Tax, Capital Gains Tax and illicit consisting of land and building, will be transferred in its entirety. payments are excluded - Will not be subject to renovations or additional construction following the Quality of land administration index (0-30) purchase. - Has no trees, natural water sources, natural reserves or historical Reliability of infrastructure index (0-8) monuments of any kind. Transparency of information index (0–6) - Will not be used for special purposes, and no special permits, such as for Geographic coverage index (0–8) residential use, industrial plants, waste storage or certain types of agricultural activities, are required. Land dispute resolution index (0–8) - Has no occupants, and no other party holds a legal interest in it. Equal access to property rights index (-2–0) Standard Property Transfer Property value EUR 1,382,429.20 City Covered Rome Page 25   OECD high OECD high Doing Business 2018 Italy Standard Property Transfer Property value EUR 1,382,429.20 City Covered Rome OECD high OECD high Indicator Italy income income Overall Best Performer Procedures (number) 4 4.6 4.6 1.00 (4 Economies) Time (days) 16 22.3 22.3 1.00 (3 Economies) Cost (% of property value) 4.4 4.2 4.2 0.00 (5 Economies) Quality of the land administration index (0-30) 26.5 22.7 22.7 29.00 (Singapore) Figure – Registering Property in Italy and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 86.12: Switzerland (Rank: 16) 81.70: Italy (Rank: 23) 76.81: Regional Average (OECD high income) 73.88: Spain (Rank: 53) 65.71: Germany (Rank: 77) 51.40: Belgium (Rank: 138) Note: The ranking of economies on the ease of registering property is determined by sorting their distance to frontier scores for registering property. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Registering Property in Italy – Procedure, Time and Cost Time Cost 16 5 14 4 Cost (% of property value) 12 10 Time (days) 3 8 2 6 4 1 2 0 0 1 *2 3 4 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Page 26   Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for registering property. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Italy Figure – Registering Property in Italy – Procedure, Time and Cost Time Cost 16 5 14 4 Cost (% of property value) 12 10 Time (days) 3 8 2 6 4 1 2 0 0 1 *2 3 4 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Registering Property in Italy and comparator economies – Measure of Quality 27 26.5 26 25 Index score 24 23.5 23 22.5 22.5 22.7 22.0 22 21 20 19 Italy Belgium Germany Spain Switzerland OECD high income Details – Registering Property in Italy – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Notary public obtains the necessary certi cates for the transaction Less than a day Included in through Notartel (online procedure), procedure 3 Agency : Notary simultaneous with procedure 2) The notary public obtains all the needed due diligence certi cates required for the transaction and verifying the identity of the parties. The notary will obtain the following certi cates through Notartel, a portal which enables the notary to access the Land Registry, the Cadastre and the Commercial Registry directly: (i) Certi cate on the property, from the Land Registry, stating who the owner is and any rights that third parties have on the property (if any); (ii) Certi cate on the property, from the Cadastre, stating the physical Page 27   characteristics of the property. Italy Belgium Germany Spain Switzerland OECD high income Doing Business 2018 Italy Details – Registering Property in Italy – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Notary public obtains the necessary certi cates for the transaction Less than a day Included in through Notartel (online procedure), procedure 3 Agency : Notary simultaneous with procedure 2) The notary public obtains all the needed due diligence certi cates required for the transaction and verifying the identity of the parties. The notary will obtain the following certi cates through Notartel, a portal which enables the notary to access the Land Registry, the Cadastre and the Commercial Registry directly: (i) Certi cate on the property, from the Land Registry, stating who the owner is and any rights that third parties have on the property (if any); (ii) Certi cate on the property, from the Cadastre, stating the physical characteristics of the property. 2 Notary veri es the powers of relevant signatories Less than a day Included in Agency : Notary (via the Company Registry - "Registro imprese" online) (online procedure), procedure 3 simultaneous with Using the website of the company registry's website, the notary will obtain procedure 1 certi cates stating that the parties have the needed powers to complete a property transfer on behalf of their companies. 3 Notary drafts and executes the deed of sale 11 days EUR 5019 (Notary's Agency : Notary fees without VAT) + EUR 230 (Imposta di Then, the notary public prepares and executes the deed of sale. Bollo) + EUR 200 registration tax (Imposta di Registro) + 3% of property value (Imposta Ipotecaria) + 1% of property value (Imposta Catastale) + EUR 35 (Tassa Ipotecaria) + EUR 55 (Diritti Catastali per Voltura) 4 Registration of the deed 4 days Included in Agency : Land Registry and Cadastral O ce procedure 3 The notary les the deed of sale and the transcription note on line using the “Modello Unico Informatico (MUI)”. It is mandatory for the notary to le the documents within 30 days of the signature of the contract. Otherwise, the notary will be ned. With a single electronic transmission digitally signed by a notary, the following information is sent: (i) the data concerning the payment of taxes (debited from bank account), (ii) the o ces of destination, i.e. Tax Agency for tax registration, Land Agency for the Land Registry and Cadastral o ce (jointly), Land Registry O ces (U cio Tavolare) for the municipalities where this speci c method of registration for real estate transfers is operational; (iii) the certi ed copy of the deed with its attachments. Taxes are credited directly to the central Revenue O ce and the various o ces retain the competence to verify the correctness of the payment. The notary gets online receipts of the various Procedures and payments made. In the case of a warehouse used for commercial purposes, sold by a company that is not in Page 28   (Diritti Catastali per Doing Business 2018 Italy Voltura) 4 Registration of the deed 4 days Included in Agency : Land Registry and Cadastral O ce procedure 3 The notary les the deed of sale and the transcription note on line using the “Modello Unico Informatico (MUI)”. It is mandatory for the notary to le the documents within 30 days of the signature of the contract. Otherwise, the notary will be ned. With a single electronic transmission digitally signed by a notary, the following information is sent: (i) the data concerning the payment of taxes (debited from bank account), (ii) the o ces of destination, i.e. Tax Agency for tax registration, Land Agency for the Land Registry and Cadastral o ce (jointly), Land Registry O ces (U cio Tavolare) for the municipalities where this speci c method of registration for real estate transfers is operational; (iii) the certi ed copy of the deed with its attachments. Taxes are credited directly to the central Revenue O ce and the various o ces retain the competence to verify the correctness of the payment. The notary gets online receipts of the various Procedures and payments made. In the case of a warehouse used for commercial purposes, sold by a company that is not in the construction business the cadastral tax is equal to 1% of sale price, according to the law 248 of 2006, and the transcription tax is equal to 3% of sale price. Italian VAT law applicable to commercial properties states that the sale of a commercial property is generally VAT exempt, unless (i) in the cases mandatorily provided for by the Italian tax law (ii) if the seller has elected for the VAT regime. In any case, the transfer of a commercial property where both the seller and the purchaser are Italian companies is subject to a xed registration tax rate. The Land registry and cadastre are 2 di erent databases, but managed by the same government agency since 2008-2009. The Land Registry has the purpose of rendering deeds enforceable towards all third parties. Until a deed has been registered in the Land Registry, it is only enforceable between the parties thereto. The Italian Land Registry system is based on the principle of continuity of the registrations ("continuità delle trascrizioni"). This means that an individual or an entity may sell a property only if the relative deed of purchase has been registered beforehand in the Land Registry. Takes place simultaneously with previous procedure. Details – Registering Property in Italy – Measure of Quality Answer Score Quality of the land administration index (0-30) 26.5 Reliability of infrastructure index (0-8) 8.0 What is the institution in charge of immovable property registration? Conservatoria dei Registri Immobiliari In what format are the majority of title or deed records kept in the largest business city Computer/Fully 2.0 —in a paper format or in a computerized format (scanned or fully digital)? digital Is there an electronic database for checking for encumbrances (liens, mortgages, Yes 1.0 restrictions and the like)? Institution in charge of the plans showing legal boundaries in the largest business city: Agenzia delle Entrate - U cio del Territorio di Roma - Catasto Page 29   Takes place simultaneously with previous procedure. Doing Business 2018 Italy Details – Registering Property in Italy – Measure of Quality Answer Score Quality of the land administration index (0-30) 26.5 Reliability of infrastructure index (0-8) 8.0 What is the institution in charge of immovable property registration? Conservatoria dei Registri Immobiliari In what format are the majority of title or deed records kept in the largest business city Computer/Fully 2.0 —in a paper format or in a computerized format (scanned or fully digital)? digital Is there an electronic database for checking for encumbrances (liens, mortgages, Yes 1.0 restrictions and the like)? Institution in charge of the plans showing legal boundaries in the largest business city: Agenzia delle Entrate - U cio del Territorio di Roma - Catasto di Roma In what format are the majority of maps of land plots kept in the largest business city— Computer/Fully 2.0 in a paper format or in a computerized format (scanned or fully digital)? digital Is there an electronic database for recording boundaries, checking plans and providing Yes 1.0 cadastral information (geographic information system)? Is the information recorded by the immovable property registration agency and the Di erent 1.0 cadastral or mapping agency kept in a single database, in di erent but linked databases databases but or in separate databases? linked Do the immovable property registration agency and cadastral or mapping agency use Yes 1.0 the same identi cation number for properties? Transparency of information index (0–6) 4.5 Who is able to obtain information on land ownership at the agency in charge of Anyone who 1.0 immovable property registration in the largest business city? pays the o cial fee Is the list of documents that are required to complete any type of property transaction Yes, in person 0.0 made publicly available–and if so, how? Link for online access: Is the applicable fee schedule for any property transaction at the agency in charge of Yes, online 0.5 immovable property registration in the largest business city made publicly available– and if so, how? Link for online access: http://www.agen ziaentrate.gov.it/ wps/content/Nsil ib/Nsi/Home/Cos aDeviFare/Consu ltare+dati+catast ali+e+ipotecari Page 30   immovable property registration in the largest business city made publicly available– and if Doing so, how? 2018 Business Italy Link for online access: http://www.agen ziaentrate.gov.it/ wps/content/Nsil ib/Nsi/Home/Cos aDeviFare/Consu ltare+dati+catast ali+e+ipotecari Does the agency in charge of immovable property registration commit to delivering a No 0.0 legally binding document that proves property ownership within a speci c time frame– and if so, how does it communicate the service standard? Link for online access: Is there a speci c and separate mechanism for ling complaints about a problem that Yes 1.0 occurred at the agency in charge of immovable property registration? Contact information: http://www.agen ziaentrate.gov.it/ wps/content/Nsil ib/Nsi/Contatta/ Reclami%2C+elo gi+e+suggerimen ti/ Are there publicly available o cial statistics tracking the number of transactions at the Yes 0.5 immovable property registration agency? Number of property transfers in the largest business city in 2015: 30253.0 Who is able to consult maps of land plots in the largest business city? Anyone who 0.5 pays the o cial fee Is the applicable fee schedule for accessing maps of land plots made publicly available Yes, online 0.5 —and if so, how? Link for online access: http://www.agen ziaentrate.gov.it/ wps/content/Nsil ib/Nsi/Home/Cos aDeviFare/Consu ltare+dati+catast ali+e+ipotecari/Vi sura+catastale/Vi sura+catastale+o nline/ Does the cadastral or mapping agency commit to delivering an updated map within a No 0.0 speci c time frame—and if so, how does it communicate the service standard? Link for online access: Is there a speci c and separate mechanism for ling complaints about a problem that Yes 0.5 occurred at the cadastral or mapping agency? Contact information: http://www.agen ziaentrate.gov.it/ wps/content/Nsil Page 31   ib/Nsi/Contatta/ Is there a speci c and separate mechanism for ling complaints about a problem that Yes 0.5 occurred Doing at the cadastral Business 2018 Italyor mapping agency? Contact information: http://www.agen ziaentrate.gov.it/ wps/content/Nsil ib/Nsi/Contatta/ Reclami%2C+elo gi+e+suggerimen ti/ Geographic coverage index (0–8) 8.0 Are all privately held land plots in the economy formally registered at the immovable Yes 2.0 property registry? Are all privately held land plots in the largest business city formally registered at the Yes 2.0 immovable property registry? Are all privately held land plots in the economy mapped? Yes 2.0 Are all privately held land plots in the largest business city mapped? Yes 2.0 Land dispute resolution index (0–8) 6.0 Does the law require that all property sale transactions be registered at the immovable Yes 1.5 property registry to make them opposable to third parties? Is the system of immovable property registration subject to a state or private Yes 0.5 guarantee? Is there a speci c compensation mechanism to cover for losses incurred by parties who No 0.0 engaged in good faith in a property transaction based on erroneous information certi ed by the immovable property registry? Does the legal system require a control of legality of the documents necessary for a Yes 0.5 property transaction (e.g., checking the compliance of contracts with requirements of the law)? If yes, who is responsible for checking the legality of the documents? Notary. Does the legal system require veri cation of the identity of the parties to a property Yes 0.5 transaction? If yes, who is responsible for verifying the identity of the parties? Notary. Is there a national database to verify the accuracy of identity documents? Yes 1.0 For a standard land dispute between two local businesses over tenure rights of a Tribunale property worth 50 times gross national income (GNI) per capita and located in the Ordinario di largest business city, what court would be in charge of the case in the rst instance? Roma, Quarta Sezione Civile (Contenzioso Immobiliare) How long does it take on average to obtain a decision from the rst-instance court for Between 1 and 2 2.0 such a case (without appeal)? years Are there any statistics on the number of land disputes in the rst instance? No 0.0 Number of land disputes in the largest business city in 2015: Equal access to property rights index (-2–0) 0.0 Page 32   Are there Doing 2018 on any statistics Business the number of land disputes in the rst instance? Italy No 0.0 Number of land disputes in the largest business city in 2015: Equal access to property rights index (-2–0) 0.0 Do unmarried men and unmarried women have equal ownership rights to property? Yes 0.0 Do married men and married women have equal ownership rights to property? Yes 0.0 Getting Credit This topic explores two sets of issues—the strength of credit reporting systems and the e ectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Strength of legal rights index (0–12) Doing Business assesses the sharing of credit information and the legal rights of borrowers and lenders with respect to secured transactions Rights of borrowers and lenders through through 2 sets of indicators. The depth of credit information index collateral laws (0-10) measures rules and practices a ecting the coverage, scope and Protection of secured creditors’ rights through accessibility of credit information available through a credit registry or a bankruptcy laws (0-2) credit bureau. The strength of legal rights index measures the degree to Depth of credit information index (0–8) which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilitate lending. For each economy it is first determined Scope and accessibility of credit information whether a unitary secured transactions system exists. Then two case distributed by credit bureaus and credit scenarios, case A and case B, are used to determine how a nonpossessory registries (0-8) security interest is created, publicized and enforced according to the law. Credit bureau coverage (% of adults) Special emphasis is given to how the collateral registry operates (if Number of individuals and firms listed in largest registration of security interests is possible). The case scenarios involve a credit bureau as a percentage of adult population secured borrower, company ABC, and a secured lender, BizBank. Credit registry coverage (% of adults) In some economies the legal framework for secured transactions will allow Number of individuals and firms listed in credit only case A or case B (not both) to apply. Both cases examine the same set registry as a percentage of adult population of legal provisions relating to the use of movable collateral. Several assumptions about the secured borrower (ABC) and lender (BizBank) are used: - ABC is a domestic limited liability company (or its legal equivalent). - ABC has up to 50 employees. - ABC has its headquarters and only base of operations in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city. - Both ABC and BizBank are 100% domestically owned. The case scenarios also involve assumptions. In case A, as collateral for the loan, ABC grants BizBank a nonpossessory security interest in one category of movable assets, for example, its machinery or its inventory. ABC wants to keep both possession and ownership of the collateral. In economies where the law does not allow nonpossessory security interests in movable property, ABC and BizBank use a fiduciary transfer-of-title arrangement (or a similar substitute for nonpossessory security interests). In case B, ABC grants BizBank a business charge, enterprise charge, floating charge or any charge that gives BizBank a security interest over ABC’s combined movable assets (or as much of ABC’s movable assets as possible). ABC keeps ownership and possession of the assets. Page 33   Do married men and married women have equal ownership rights to property? Yes 0.0 Doing Business 2018 Italy Getting Credit This topic explores two sets of issues—the strength of credit reporting systems and the e ectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Strength of legal rights index (0–12) Doing Business assesses the sharing of credit information and the legal rights of borrowers and lenders with respect to secured transactions Rights of borrowers and lenders through through 2 sets of indicators. The depth of credit information index collateral laws (0-10) measures rules and practices a ecting the coverage, scope and Protection of secured creditors’ rights through accessibility of credit information available through a credit registry or a bankruptcy laws (0-2) credit bureau. The strength of legal rights index measures the degree to Depth of credit information index (0–8) which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilitate lending. For each economy it is first determined Scope and accessibility of credit information whether a unitary secured transactions system exists. Then two case distributed by credit bureaus and credit scenarios, case A and case B, are used to determine how a nonpossessory registries (0-8) security interest is created, publicized and enforced according to the law. Credit bureau coverage (% of adults) Special emphasis is given to how the collateral registry operates (if Number of individuals and firms listed in largest registration of security interests is possible). The case scenarios involve a credit bureau as a percentage of adult population secured borrower, company ABC, and a secured lender, BizBank. Credit registry coverage (% of adults) In some economies the legal framework for secured transactions will allow Number of individuals and firms listed in credit only case A or case B (not both) to apply. Both cases examine the same set registry as a percentage of adult population of legal provisions relating to the use of movable collateral. Several assumptions about the secured borrower (ABC) and lender (BizBank) are used: - ABC is a domestic limited liability company (or its legal equivalent). - ABC has up to 50 employees. - ABC has its headquarters and only base of operations in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city. - Both ABC and BizBank are 100% domestically owned. The case scenarios also involve assumptions. In case A, as collateral for the loan, ABC grants BizBank a nonpossessory security interest in one category of movable assets, for example, its machinery or its inventory. ABC wants to keep both possession and ownership of the collateral. In economies where the law does not allow nonpossessory security interests in movable property, ABC and BizBank use a fiduciary transfer-of-title arrangement (or a similar substitute for nonpossessory security interests). In case B, ABC grants BizBank a business charge, enterprise charge, floating charge or any charge that gives BizBank a security interest over ABC’s combined movable assets (or as much of ABC’s movable assets as possible). ABC keeps ownership and possession of the assets. OECD high OECD high Indicator Italy income income Overall Best Performer Strength of legal rights index (0-12) 2 6.0 6.0 12.00 (4 Economies) Depth of credit information index (0-8) 7 6.6 6.6 8.00 (34 Economies) Page 34   Credit registry coverage (% of adults) 30.1 18.3 18.3 100.00 (3 Economies) possible). ABC keeps ownership and possession of the assets. Doing Business 2018 Italy OECD high OECD high Indicator Italy income income Overall Best Performer Strength of legal rights index (0-12) 2 6.0 6.0 12.00 (4 Economies) Depth of credit information index (0-8) 7 6.6 6.6 8.00 (34 Economies) Credit registry coverage (% of adults) 30.1 18.3 18.3 100.00 (3 Economies) Credit bureau coverage (% of adults) 100.0 63.7 63.7 100.00 (23 Economies) Figure – Getting Credit in Italy and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 70.00: Germany (Rank: 42) 63.03: Regional Average (OECD high income) 60.00: Switzerland (Rank: 68) 60.00: Spain (Rank: 68) 45.00: Belgium (Rank: 105) 45.00: Italy (Rank: 105) Note: The ranking of economies on the ease of getting credit is determined by sorting their distance to frontier scores for getting credit. These scores are the distance to frontier score for the sum of the strength of legal rights index and the depth of credit information index. Figure – Legal Rights in Italy and comparator economies 7 6 6 6.0 6 5 5 Index score 4 4 3 2 2 1 0 Italy Belgium Germany Spain Switzerland OECD high income Details – Legal Rights in Italy Strength of legal rights index (0-12) 2 Does an integrated or uni ed legal framework for secured transactions that extends to the creation, publicity and No enforcement of functional equivalents to security interests in movable assets exist in the economy? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without No requiring a speci c description of collateral? Page 35   Italy Belgium Germany Spain Switzerland OECD high income Doing Business 2018 Italy Details – Legal Rights in Italy Strength of legal rights index (0-12) 2 Does an integrated or uni ed legal framework for secured transactions that extends to the creation, publicity and No enforcement of functional equivalents to security interests in movable assets exist in the economy? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without No requiring a speci c description of collateral? Does the law allow businesses to grant a non possessory security right in substantially all of its assets, without requiring No a speci c description of collateral? May a security right extend to future or after-acquired assets, and does it extend automatically to the products, proceeds Yes or replacements of the original assets? Is a general description of debts and obligations permitted in collateral agreements; can all types of debts and Yes obligations be secured between parties; and can the collateral agreement include a maximum amount for which the assets are encumbered? Is a collateral registry in operation for both incorporated and non-incorporated entities, that is uni ed geographically No and by asset type, with an electronic database indexed by debtor's name? Does a notice-based collateral registry exist in which all functional equivalents can be registered? No Does a modern collateral registry exist in which registrations, amendments, cancellations and searches can be No performed online by any interested third party? Are secured creditors paid rst (i.e. before tax claims and employee claims) when a debtor defaults outside an insolvency No procedure? Are secured creditors paid rst (i.e. before tax claims and employee claims) when a business is liquidated? No Are secured creditors subject to an automatic stay on enforcement when a debtor enters a court-supervised No reorganization procedure? Does the law protect secured creditors’ rights by providing clear grounds for relief from the stay and/or sets a time limit for it? Does the law allow parties to agree on out of court enforcement at the time a security interest is created? Does the law No allow the secured creditor to sell the collateral through public auction or private tender, as well as, for the secured creditor to keep the asset in satisfaction of the debt? Figure – Credit Information in Italy and comparator economies 10 8 8 7 7 6.6 Index score 6 6 5 4 2 0 Italy Belgium Germany Spain Switzerland OECD high income Details – Credit Information in Italy Page 36   0 Italy Doing Business 2018 Italy Belgium Germany Spain Switzerland OECD high income Details – Credit Information in Italy Credit Credit Depth of credit information index (0-8) bureau registry Score Are data on both firms and individuals distributed? Yes Yes 1 Are both positive and negative credit data distributed? Yes Yes 1 Are data from retailers or utility companies - in addition to data from banks and financial institutions - No No 0 distributed? Are at least 2 years of historical data distributed? (Credit bureaus and registries that distribute more Yes Yes 1 than 10 years of negative data or erase data on defaults as soon as they are repaid obtain a score of 0 for this component.) Are data on loan amounts below 1% of income per capita distributed? Yes Yes 1 By law, do borrowers have the right to access their data in the credit bureau or credit registry? Yes Yes 1 Can banks and financial institutions access borrowers’ credit information online (for example, Yes Yes 1 through an online platform, a system-to-system connection or both)? Are bureau or registry credit scores offered as a value-added service to help banks and financial Yes No 1 institutions assess the creditworthiness of borrowers? Score ("yes" to either public bureau or private registry) 7 Note: An economy receives a score of 1 if there is a "yes" to either bureau or registry. If the credit bureau or registry is not operational or covers less than 5% of the adult population, the total score on the depth of credit information index is 0. Coverage Credit bureau Credit registry Number of individuals 44,373,322 9,958,344 Number of firms 6,729,958 1,646,090 Total 51,103,280 11,604,434 Percentage of adult population 100.0 30.1 Protecting Minority Investors This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Extent of disclosure index (0–10): Review and To make the data comparable across economies, a case study uses several approval requirements for related-party assumptions about the business and the transaction. transactions; Disclosure requirements for related-party transactions The business (Buyer): Extent of director liability index (0–10): Ability of - Is a publicly traded corporation listed on the economy’s most important minority shareholders to sue and hold interested stock exchange. If the number of publicly traded companies listed on that directors liable for prejudicial related-party exchange is less than 10, or if there is no stock exchange in the economy, it is assumed that Buyer is a large private company with multiple Page 37   transactions; Available legal remedies (damages, Percentage of adult population 100.0 30.1 Doing Business 2018 Italy Protecting Minority Investors This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Extent of disclosure index (0–10): Review and To make the data comparable across economies, a case study uses several approval requirements for related-party assumptions about the business and the transaction. transactions; Disclosure requirements for related-party transactions The business (Buyer): Extent of director liability index (0–10): Ability of - Is a publicly traded corporation listed on the economy’s most important minority shareholders to sue and hold interested stock exchange. If the number of publicly traded companies listed on that directors liable for prejudicial related-party exchange is less than 10, or if there is no stock exchange in the economy, it transactions; Available legal remedies (damages, is assumed that Buyer is a large private company with multiple disgorgement of profits, fines, imprisonment, shareholders. rescission of the transaction) - Has a board of directors and a chief executive o cer (CEO) who may legally act on behalf of Buyer where permitted, even if this is not speci cally Ease of shareholder suits index (0–10): Access to required by law. internal corporate documents; Evidence - Has a supervisory board (applicable to economies with a two-tier board obtainable during trial and allocation of legal system) on which 60% of the shareholder-elected members have been expenses appointed by Mr. James, who is Buyer’s controlling shareholder and a Extent of conflict of interest regulation index member of Buyer’s board of directors. (0–10): Simple average of the extent of disclosure, - Has not adopted any bylaws or articles of association that di er from extent of director liability and ease of default minimum standards and does not follow any nonmandatory codes, shareholder indices principles, recommendations or guidelines relating to corporate Extent of shareholder rights index (0-10): governance. Shareholders’ rights and role in major corporate - Is a manufacturing company with its own distribution network. decisions Extent of ownership and control index (0-10): The transaction involves the following details: Governance safeguards protecting shareholders - Mr. James owns 60% of Buyer and elected two directors to Buyer’s ve- from undue board control and entrenchment member board. Extent of corporate transparency index (0-10): - Mr. James also owns 90% of Seller, a company that operates a chain of Corporate transparency on ownership stakes, retail hardware stores. Seller recently closed a large number of its stores. compensation, audits and financial prospects - Mr. James proposes that Buyer purchase Seller’s unused eet of trucks to expand Buyer’s distribution of its food products, a proposal to which Buyer Extent of shareholder governance index (0–10): agrees. The price is equal to 10% of Buyer’s assets and is higher than the Simple average of the extent of shareholders market value. rights, extent of ownership and control and - The proposed transaction is part of the company’s ordinary course of extent of corporate transparency indices business and is not outside the authority of the company. Strength of minority investor protection index - Buyer enters into the transaction. All required approvals are obtained, (0–10): Simple average of the extent of conflict of and all required disclosures made (that is, the transaction is not interest regulation and extent of shareholder fraudulent). governance indices - The transaction causes damages to Buyer. Shareholders sue Mr. James and the other parties that approved the transaction. OECD high OECD high Indicator Italy income income Overall Best Performer Extent of conflict of interest regulation index (0- 5.7 6.4 6.4 9.3 (New Zealand) 10) Extent of shareholder governance index (0-10) 6 6.4 6.4 Page 38   9.00 (Kazakhstan) and the other parties that approved the transaction. Doing Business 2018 Italy OECD high OECD high Indicator Italy income income Overall Best Performer Extent of conflict of interest regulation index (0- 5.7 6.4 6.4 9.3 (New Zealand) 10) Extent of shareholder governance index (0-10) 6 6.4 6.4 9.00 (Kazakhstan) Figure – Protecting Minority Investors in Italy and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 70.00: Spain (Rank: 24) 63.93: Regional Average (OECD high income) 60.00: Belgium (Rank: 57) 58.33: Germany (Rank: 62) 58.33: Italy (Rank: 62) 50.00: Switzerland (Rank: 108) Note: The ranking of economies on the strength of minority investor protections is determined by sorting their distance to frontier scores for protecting minority investors. These scores are the simple average of the distance to frontier scores for the extent of con ict of interest regulation index and the extent of shareholder governance index. Figure – Protecting Minority Investors in Italy and comparator economies – Measure of Quality Italy 8 4 7 4 6 6 Belgium 7 6 8 4 4 7 Germany 7 5 5 6 7 5 Spain 9 6 7 5 9 6 Switzerland 7 5 0 5 8 5 OECD high income 7.3 5.6 6.5 5.2 6.3 7.4 0 5 10 15 20 25 30 35 40 45 Sub-Indicator Score Extent of corporate transparency index (0­10) Extent of director liability index (0­10) Extent of disclosure index (0­10) Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Details – Protecting Minority Investors in Italy – Measure of Quality Answer Score Page 39   Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Doing Business 2018 Italy Details – Protecting Minority Investors in Italy – Measure of Quality Answer Score Extent of con ict of interest regulation index (0-10) 5.7 Extent of disclosure index (0-10) 7 Which corporate body is legally su cient to approve the Buyer-Seller transaction? (0-3) Shareholders or 1.0 board of directors including interested parties Must an external body review the terms of the transaction before it takes place? (0-1) No 0.0 Must Mr. James disclose his con ict of interest to the board of directors? (0-2) Full disclosure of 2.0 all material facts Must Buyer disclose the transaction in published periodic lings (annual reports)? (0-2) Disclosure on 2.0 the transaction and on the con ict of interest Must Buyer immediately disclose the transaction to the public and/or shareholders? (0- Disclosure on 2.0 2) the transaction and on the con ict of interest Extent of director liability index (0-10) 4 Can shareholders representing 10% of Buyer's share capital sue directly or derivatively Yes 1.0 for the damage the transaction caused to Buyer? (0-1) Can shareholders hold the interested director liable for the damage the transaction Liable if negligent 1.0 caused to Buyer? (0-2) Can shareholders hold the other directors liable for the damage the transaction caused Liable if negligent 1.0 to Buyer (0-2) Must Mr. James pay damages for the harm caused to Buyer upon a successful claim by Yes 1.0 shareholders? (0-1) Must Mr. James repay pro ts made from the transaction upon a successful claim by No 0.0 shareholders? (0-1) Is Mr. James disquali ed or ned and imprisoned upon a successful claim by No 0.0 shareholders? (0-1) Can a court void the transaction upon a successful claim by shareholders? (0-2) Only in case of 0.0 fraud or bad faith Ease of shareholder suits index (0-10) 6 Before suing can shareholders representing 10% of Buyer's share capital inspect the Yes 1.0 transaction documents? (0-1) Page 40   shareholder Ease ofBusiness Doing Italy (0-10) suits index 2018 6 Before suing can shareholders representing 10% of Buyer's share capital inspect the Yes 1.0 transaction documents? (0-1) Can the plainti obtain any documents from the defendant and witnesses at trial? (0-3) Any relevant 3.0 document Can the plainti request categories of documents from the defendant without No 0.0 identifying speci c ones? (0-1) Can the plainti directly question the defendant and witnesses at trial? (0-2) No 0.0 Is the level of proof required for civil suits lower than that of criminal cases? (0-1) Yes 1.0 Can shareholder plainti s recover their legal expenses from the company? (0-2) Yes if successful 1.0 Extent of shareholder governance index (0-10) 6 Extent of shareholder rights index (0-10) 6 Does the sale of 51% of Buyer's assets require shareholder approval? No 0.0 Can shareholders representing 10% of Buyer's share capital call for a meeting of Yes 1.0 shareholders? Must Buyer obtain its shareholders’ approval every time it issues new shares? Yes 1.0 Do shareholders automatically receive preemption rights every time Buyer issues new Yes 1.0 shares? Must shareholders approve the election and dismissal of the external auditor? Yes 1.0 Are changes to the rights of a class of shares only possible if the holders of the a ected Yes 1.0 shares approve? Assuming that Buyer is a limited company, does the sale of 51% of its assets require No 0.0 member approval? Assuming that Buyer is a limited company, can members representing 10% call for a No 0.0 meeting of members? Assuming that Buyer is a limited company, must all members consent to add a new Yes 1.0 member? Assuming that Buyer is a limited company, must a member rst o er to sell their No 0.0 interest to the existing members before they can sell to non-members? Extent of ownership and control index (0-10) 4 Is it forbidden to appoint the same individual as CEO and chair of the board of No 0.0 directors? Must the board of directors include independent and nonexecutive board members? Yes 1.0 Can shareholders remove members of the board of directors without cause before the Yes 1.0 end of their term? Must the board of directors include a separate audit committee exclusively comprising No 0.0 board members? Must a potential acquirer make a tender o er to all shareholders upon acquiring 50% Yes 1.0 Page 41   of Buyer? Must the board of directors include a separate audit committee exclusively comprising No 0.0 board Doing members? Business 2018 Italy Must a potential acquirer make a tender o er to all shareholders upon acquiring 50% Yes 1.0 of Buyer? Must Buyer pay declared dividends within a maximum period set by law? No 0.0 Is a subsidiary prohibited from acquiring shares issued by its parent company? Yes 1.0 Assuming that Buyer is a limited company, must Buyer have a mechanism to resolve No 0.0 disagreements among members? Assuming that Buyer is a limited company, must a potential acquirer make a tender No 0.0 o er to all shareholders upon acquiring 50% of Buyer? Assuming that Buyer is a limited company, must Buyer distribute pro ts within a No 0.0 maximum period set by law? Extent of corporate transparency index (0-10) 8 Must Buyer disclose direct and indirect bene cial ownership stakes representing 5%? Yes 1.0 Must Buyer disclose information about board members’ primary employment and Yes 1.0 directorships in other companies? Must Buyer disclose the compensation of individual managers? Yes 1.0 Must a detailed notice of general meeting be sent 21 days before the meeting? Yes 1.0 Can shareholders representing 5% of Buyer’s share capital put items on the general Yes 1.0 meeting agenda? Must Buyer's annual nancial statements be audited by an external auditor? Yes 1.0 Must Buyer disclose its audit reports to the public? Yes 1.0 Assuming that Buyer is a limited company, must members meet at least once a year? No 0.0 Assuming that Buyer is a limited company, can members representing 5% put items on No 0.0 the meeting agenda? Assuming that Buyer is a limited company, must Buyer's annual nancial statements be Yes 1.0 audited by an external auditor? Paying Taxes This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as measures the administrative burden in paying taxes and contributions. The most recent round of data collection for the project was completed on June 30, 2017 covering for the Paying Taxes indicator calendar year 2016 (January 1, 2016 – December 31, 2016). Last year (Doing Business 2017) the scope of data collection was expanded to better understand the overall tax environment in an economy. The questionnaire was expanded to include new questions on post- ling processes: VAT refund and tax audit. The data shows where post ling processes and practices work e ciently and what drives the di erences in the overall tax compliance cost across economies. The new section covers both the legal framework and the administrative burden on businesses to comply with post ling processes. See the methodology for more information. What the indicators measure Case study assumptions Page 42   Tax payments for a manufacturing company in Using a case scenario, Doing Business records taxes and mandatory Assuming that Buyer is a limited company, must Buyer's annual nancial statements be Yes 1.0 audited by an external auditor? Doing Business 2018 Italy Paying Taxes This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as measures the administrative burden in paying taxes and contributions. The most recent round of data collection for the project was completed on June 30, 2017 covering for the Paying Taxes indicator calendar year 2016 (January 1, 2016 – December 31, 2016). Last year (Doing Business 2017) the scope of data collection was expanded to better understand the overall tax environment in an economy. The questionnaire was expanded to include new questions on post- ling processes: VAT refund and tax audit. The data shows where post ling processes and practices work e ciently and what drives the di erences in the overall tax compliance cost across economies. The new section covers both the legal framework and the administrative burden on businesses to comply with post ling processes. See the methodology for more information. What the indicators measure Case study assumptions Tax payments for a manufacturing company in Using a case scenario, Doing Business records taxes and mandatory 2016 (number per year adjusted for electronic and contributions a medium size company must pay in a year, and measures joint ling and payment) the administrative burden of paying taxes, contributions and dealing with post ling processes. Information is also compiled on frequency of ling Total number of taxes and contributions paid, and payments, time taken to comply with tax laws, time taken to comply including consumption taxes (value added tax, with the requirements of post ling processes and time waiting. sales tax or goods and service tax) Method and frequency of filing and payment To make data comparable across economies, several assumptions are used: Time required to comply with 3 major taxes - TaxpayerCo is a medium-size business that started operations on January (hours per year) 1, 2015. It produces ceramic flowerpots and sells them at retail. All taxes Collecting information, computing tax payable and contributions recorded are paid in the second year of operation Completing tax return, filing with agencies (calendar year 2016). Taxes and mandatory contributions are measured at all levels of government. Arranging payment or withholding Preparing separate tax accounting books, if The VAT refund process: required - In June 2016, TaxpayerCo. makes a large capital purchase: the value of the Total tax and contribution rate (% of pro t before machine is 65 times income per capita of the economy. Sales are equally all taxes) spread per month (1,050 times income per capita divided by 12) and cost of goods sold are equally expensed per month (875 times income per Profit or corporate income tax capita divided by 12). The machinery seller is registered for VAT and excess Social contributions, labor taxes paid by input VAT incurred in June will be fully recovered after four consecutive employer months if the VAT rate is the same for inputs, sales and the machine and Property and property transfer taxes the tax reporting period is every month. Input VAT will exceed Output VAT Dividend, capital gains, financial transactions in June 2016. taxes The corporate income tax audit process: Waste collection, vehicle, road and other taxes - An error in calculation of income tax liability (for example, use of incorrect Post ling Index tax depreciation rates, or incorrectly treating an expense as tax deductible) leads to an incorrect income tax return and a corporate income Time to comply with a VAT refund tax underpayment. TaxpayerCo. discovered the error and voluntarily Time to receive a VAT refund noti ed the tax authority. The value of the underpaid income tax liability is Time to comply with a corporate income tax audit 5% of the corporate income tax liability due. TaxpayerCo. submits corrected information after the deadline for submitting the annual tax Time to complete a corporate income tax audit return, but within the tax assessment period. OECD high OECD high Indicator Italy income income Overall Best Performer Payments (number per year) 14 10.9 10.9 3 (Hong Kong SAR, China) Page 43   return, but within the tax assessment period. Doing Business 2018 Italy OECD high OECD high Indicator Italy income income Overall Best Performer Payments (number per year) 14 10.9 10.9 3 (Hong Kong SAR, China) Time (hours per year) 238 160.7 160.7 55 (Luxembourg) Total tax and contribution rate (% of profit) 48.0 40.1 40.1 18.47% (32 Economies) Postfiling index (0-100) 52.39 83.45 83.45 99.38 (Estonia) Figure – Paying Taxes in Italy and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 87.66: Switzerland (Rank: 19) 84.44: Spain (Rank: 34) 83.07: Regional Average (OECD high income) 82.14: Germany (Rank: 41) 77.69: Belgium (Rank: 59) 68.29: Italy (Rank: 112) Note: The ranking of economies on the ease of paying taxes is determined by sorting their distance to frontier scores on the ease of paying taxes. These scores are the simple average of the distance to frontier scores for each of the four component indicators – number of tax payments. time, total tax rate and post ling index – with a threshold and a nonlinear transformation applied to one of the component indicators, the total tax rate. The nonlinear distance to frontier for the total tax rate is equal to the distance to frontier for the total tax rate to the power of 0.8. The threshold is de ned as the total tax rate at the 15th percentile of the overall distribution for all years included in the analysis up to and including Doing Business 2015, which is 26.1%. All economies with a total tax rate below this threshold receive the same score as the economy at the threshold. Figure – Paying Taxes in Italy and comparator economies – Measure of Quality 120 97.67 93.60 100 83.45 83.21 83.45 80 Index score 60 52.39 40 20 0 Italy Belgium Germany Spain Switzerland OECD high income Details – Paying Taxes in Italy Total tax and contribution Tax or mandatory Payments Notes on Time Statutory tax rate (% of Notes contribution (number) Payments (hours) rate Tax base profit) TTR onPage 44   Doing Business 2018 Italy Figure – Paying Taxes in Italy and comparator economies – Measure of Quality 120 97.67 93.60 100 83.45 83.21 83.45 80 Index score 60 52.39 40 20 0 Italy Belgium Germany Spain Switzerland OECD high income Details – Paying Taxes in Italy Total tax and contribution Tax or mandatory Payments Notes on Time Statutory tax rate (% of Notes contribution (number) Payments (hours) rate Tax base profit) on TTR Corporate income tax (IRES) 1 online 39 27.5% taxable profit 19.77 Employer paid - Social 1 online 169 12.14%-16.33% gross salaries 14.62 security contributions Employer paid - Mandatory 0 jointly 7.61%-7.81% gross salaries 8.61 contribution for work termination (TFR) Regional tax on productive 1 online 3.9% difference 3.48 activities (IRAP) between taxable revenues and deductible costs Tax on real estate (IMU) 1 online 1.06% cadastral value of 1.29 property Tax on interest 0 26% interest income 0.67 included in other taxes Chamber of commerce 1 online EUR 373 + previous year 0.13 duties various rates turnover Municipal service tax (TASI) 1 online 0.08% cadastral value of 0.10 property Fixed tax on legal and fiscal 1 EUR 516 fixed fee 0.03 registries Tax on check transactions 1 EUR 100 fixed fee 0.01 Stamp duty on contracts 1 various rates pages of contracts 0.00 small amount Fuel tax 1 included into fuel 0.00 small price amount Page 45   Stamp duty on contracts 1 various rates pages of contracts 0.00 small Doing Business 2018 Italy amount Fuel tax 1 included into fuel 0.00 small price amount Insurance tax 1 various rates insurance 0.00 small premium amount Advertising tax 1 various rates type of advertising 0.00 small amount Employee paid - Social 0 jointly 9.39%-9.49% gross salaries 0.00 withheld security contributions Value added tax (VAT) 1 online 30 22% value added and 0.00 not land included Vehicle tax 1 online various rates vehicle KW 0.00 small amount Totals 14 238 48.0 Details – Paying Taxes in Italy – Tax by Type Taxes by type Answer Profit tax (% of profit) 23.3 Labor tax and contributions (% of profit) 23.2 Other taxes (% of profit) 1.6 Details – Paying Taxes in Italy – Measure of Quality Answer Score Post ling index (0-100) 52.39 VAT refunds Does VAT exist? Yes Does a VAT refund process exist per the case study? Yes Restrictions on VAT refund process None Percentage of cases exposed to a VAT audit (%) 50% - 74% Is there a mandatory carry forward period? No Time to comply with VAT refund (hours) 42.0 16 Time to obtain a VAT refund (weeks) 62.6 0 Corporate income tax audits Does corporate income tax exist? Yes Page 46   Percentage of cases exposed to a corporate income tax audit (%) 0% - 24% Corporate Doing tax audits income2018 Business Italy Does corporate income tax exist? Yes Percentage of cases exposed to a corporate income tax audit (%) 0% - 24% Time to comply with a corporate income tax audit (hours) 5.0 93.58 Time to complete a corporate income tax audit (weeks) No tax audit per 100 case study scenario Notes: Names of taxes have been standardized. For instance income tax, pro t tax, tax on company's income are all named corporate income tax in this table. The hours for VAT include all the VAT and sales taxes applicable. The hours for Social Security include all the hours for labor taxes and mandatory contributions in general. The post ling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax audit and time to complete a corporate income tax audit. N/A = Not applicable. Trading across Borders Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tari s) associated with three sets of procedures—documentary compliance, border compliance and domestic transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Given the importance of trade digitalization, in Doing Business 2018, the Trading across Borders questionnaire included research questions on the availability and status of implementation of Electronic Data Interchange (EDI) and Single Window (SW) systems. With this information, Doing Business built a comprehensive dataset on the adoption and level of sophistication of electronic platforms in 190 economies. These data are not used to compute the distance to frontier score or ranking of the ease of doing business. The new dataset on EDI and SW systems is available here. What the indicators measure Case study assumptions Documentary compliance To make the data comparable across economies, a few assumptions are made about the traded goods and the transactions: Obtaining, preparing and submitting documents during transport, clearance, inspections and port Time: Time is measured in hours, and 1 day is 24 hours (for example, 22 or border handling in origin economy days are recorded as 22×24=528 hours). If customs clearance takes 7.5 Obtaining, preparing and submitting documents hours, the data are recorded as is. Alternatively, suppose documents are required by destination economy and any transit submitted to a customs agency at 8:00a.m., are processed overnight and economies can be picked up at 8:00a.m. the next day. The time for customs clearance Covers all documents required by law and in would be recorded as 24 hours because the actual procedure took 24 practice, including electronic submissions of hours. information Border compliance Cost: Insurance cost and informal payments for which no receipt is issued are excluded from the costs recorded. Costs are reported in U.S. dollars. Customs clearance and inspections Contributors are asked to convert local currency into U.S. dollars based on Inspections by other agencies (if applied to more the exchange rate prevailing on the day they answer the questionnaire. than 20% of shipments) Contributors are private sector experts in international trade logistics and Handling and inspections that take place at the are informed about exchange rates. economy’s port or border Assumptions of the case study: - For all 190 economies covered by Doing Domestic transport Business, it is assumed a shipment is in a warehouse in the largest Loading or unloading of the shipment at the business city of the exporting economy and travels to a warehouse in the warehouse or port/border largest business city of the importing economy. - It is assumed each Transport between warehouse and port/border economy imports 15 metric tons of containerized auto parts (HS 8708) Page 47   from its natural import partner—the economy from which it imports the Traffic delays and road police checks while a corporate income tax audit and time to complete a corporate income tax audit. N/A = Not applicable. Doing Business 2018 Italy Trading across Borders Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tari s) associated with three sets of procedures—documentary compliance, border compliance and domestic transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Given the importance of trade digitalization, in Doing Business 2018, the Trading across Borders questionnaire included research questions on the availability and status of implementation of Electronic Data Interchange (EDI) and Single Window (SW) systems. With this information, Doing Business built a comprehensive dataset on the adoption and level of sophistication of electronic platforms in 190 economies. These data are not used to compute the distance to frontier score or ranking of the ease of doing business. The new dataset on EDI and SW systems is available here. What the indicators measure Case study assumptions Documentary compliance To make the data comparable across economies, a few assumptions are made about the traded goods and the transactions: Obtaining, preparing and submitting documents during transport, clearance, inspections and port Time: Time is measured in hours, and 1 day is 24 hours (for example, 22 or border handling in origin economy days are recorded as 22×24=528 hours). If customs clearance takes 7.5 Obtaining, preparing and submitting documents hours, the data are recorded as is. Alternatively, suppose documents are required by destination economy and any transit submitted to a customs agency at 8:00a.m., are processed overnight and economies can be picked up at 8:00a.m. the next day. The time for customs clearance Covers all documents required by law and in would be recorded as 24 hours because the actual procedure took 24 practice, including electronic submissions of hours. information Border compliance Cost: Insurance cost and informal payments for which no receipt is issued are excluded from the costs recorded. Costs are reported in U.S. dollars. Customs clearance and inspections Contributors are asked to convert local currency into U.S. dollars based on Inspections by other agencies (if applied to more the exchange rate prevailing on the day they answer the questionnaire. than 20% of shipments) Contributors are private sector experts in international trade logistics and Handling and inspections that take place at the are informed about exchange rates. economy’s port or border Assumptions of the case study: - For all 190 economies covered by Doing Domestic transport Business, it is assumed a shipment is in a warehouse in the largest Loading or unloading of the shipment at the business city of the exporting economy and travels to a warehouse in the warehouse or port/border largest business city of the importing economy. - It is assumed each Transport between warehouse and port/border economy imports 15 metric tons of containerized auto parts (HS 8708) from its natural import partner—the economy from which it imports the Traffic delays and road police checks while shipment is en route largest value (price times quantity) of auto parts. It is assumed each economy exports the product of its comparative advantage (de ned by the largest export value) to its natural export partner—the economy that is the largest purchaser of this product. Shipment value is assumed to be $50,000. - The mode of transport is the one most widely used for the chosen export or import product and the trading partner, as is the seaport, or land border crossing. - All electronic information submissions requested by any government agency in connection with the shipment are considered to be documents obtained, prepared and submitted during the export or import process. - A port or border is a place (seaport, airport or land border crossing) where merchandise can enter or leave an economy. - Relevant government agencies include customs, port authorities, road police, border guards, standardization agencies, ministries or departments of agriculture or industry, national security agencies and any other government authorities. Page 48   of agriculture or industry, national security agencies and any other Doing Business 2018 Italy government authorities. OECD high OECD high Indicator Italy income income Overall Best Performer Time to export: Border compliance (hours) 0 12.7 12.7 0 (17 Economies) Cost to export: Border compliance (USD) 0 149.9 149.9 0.00 (19 Economies) Time to export: Documentary compliance 1 2.4 2.4 1.0 (25 Economies) (hours) Cost to export: Documentary compliance (USD) 0 35.4 35.4 0.00 (19 Economies) Time to import: Border compliance (hours) 0 8.7 8.7 0.00 (21 Economies) Cost to import: Border compliance (USD) 0 111.6 111.6 0.00 (27 Economies) Time to import: Documentary compliance 1 3.5 3.5 1.0 (30 Economies) (hours) Cost to import: Documentary compliance (USD) 0 25.6 25.6 0.00 (30 Economies) Figure – Trading across Borders in Italy and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 93.92: Regional Average (OECD high income) 91.79: Switzerland (Rank: 38) 91.77: Germany (Rank: 39) 100.00: Belgium (Rank: 1) 100.00: Spain (Rank: 1) 100.00: Italy (Rank: 1) Note: The ranking of economies on the ease of trading across borders is determined by sorting their distance to frontier scores for trading across borders. These scores are the simple average of the distance to frontier scores for the time and cost for documentary compliance and border compliance to export and import (domestic transport is not used for calculating the ranking). Figure – Trading across Borders in Italy – Time and Cost Time Cost 1.2 1.2 1 1 1 1 0.8 0.8 Time (hours) Cost (USD) 0.6 0.6 0.4 0.4 0.2 0.2 0 0 0 0 0 0 0 0 Export - Border Compliance Export - Documentary Compliance Import - Border Compliance Import - Documentary Compliance Page 49   Doing Business 2018 Italy Figure – Trading across Borders in Italy – Time and Cost Time Cost 1.2 1.2 1 1 1 1 0.8 0.8 Time (hours) Cost (USD) 0.6 0.6 0.4 0.4 0.2 0.2 0 0 0 0 0 0 0 0 Export - Border Compliance Export - Documentary Compliance Import - Border Compliance Import - Documentary Compliance Details – Trading across Borders in Italy Characteristics Export Import Product HS 84 : Nuclear reactors, boilers, machinery and mechanical HS 8708: Parts and accessories of appliances; parts thereof motor vehicles Trade partner Germany Germany Border Italy- Austria border crossing Italy- Austria border crossing Distance (km) 722 722 Domestic transport 12 12 time (hours) Domestic transport 1225 1225 cost (USD) Details – Trading across Borders in Italy – Components of Border Compliance Time to Complete Associated Costs (hours) (USD) Export: Clearance and inspections required by customs authorities 0.0 0.0 Export: Clearance and inspections required by agencies other than customs 0.0 0.0 Export: Port or border handling 0.0 0.0 Import: Clearance and inspections required by customs authorities 0.0 0.0 Import: Clearance and inspections required by agencies other than customs 0.0 0.0 Import: Port or border handling 0.0 0.0 Details – Trading across Borders in Italy – Trade Documents Export Import Page 50   cost (USD) Doing Business 2018 Italy Details – Trading across Borders in Italy – Components of Border Compliance Time to Complete Associated Costs (hours) (USD) Export: Clearance and inspections required by customs authorities 0.0 0.0 Export: Clearance and inspections required by agencies other than customs 0.0 0.0 Export: Port or border handling 0.0 0.0 Import: Clearance and inspections required by customs authorities 0.0 0.0 Import: Clearance and inspections required by agencies other than customs 0.0 0.0 Import: Port or border handling 0.0 0.0 Details – Trading across Borders in Italy – Trade Documents Export Import CMR waybill CMR waybill Commercial invoice Commercial invoice Packing list Packing list Intrastat Intrastat Enforcing Contracts The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local rst-instance court, and the quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and e ciency in the court system. The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to enforce a contract through the The dispute in the case study involves the breach of a sales contract courts (calendar days) between 2 domestic businesses. The case study assumes that the court hears an expert on the quality of the goods in dispute. This distinguishes Time to file and serve the case the case from simple debt enforcement. Time for trial and to obtain the judgment To make the data comparable across economies, Doing Business uses Time to enforce the judgment several assumptions about the case: Cost required to enforce a contract through the - The dispute concerns a lawful transaction between two businesses (Seller courts (% of claim) and Buyer), both located in the economy’s largest business city. For 11 Attorney fees economies the data are also collected for the second largest business city. - The buyer orders custom-made goods, then fails to pay. Court fees - The value of the dispute is 200% of the income per capita or the Enforcement fees equivalent in local currency of USD 5,000, whichever is greater. Quality of judicial processes index (0-18) - The seller sues the buyer before the court with jurisdiction over commercial cases worth 200% of income per capita or $5,000. Court structure and proceedings (-1-5) - The seller requests a pretrial attachment to secure the claim. Case management (0-6) - The dispute on the quality of the goods requires an expert opinion. Court automation (0-4) - The judge decides in favor of the seller; there is no appeal. Page 51   Intrastat Intrastat Doing Business 2018 Italy Enforcing Contracts The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local rst-instance court, and the quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and e ciency in the court system. The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to enforce a contract through the The dispute in the case study involves the breach of a sales contract courts (calendar days) between 2 domestic businesses. The case study assumes that the court hears an expert on the quality of the goods in dispute. This distinguishes Time to file and serve the case the case from simple debt enforcement. Time for trial and to obtain the judgment To make the data comparable across economies, Doing Business uses Time to enforce the judgment several assumptions about the case: Cost required to enforce a contract through the - The dispute concerns a lawful transaction between two businesses (Seller courts (% of claim) and Buyer), both located in the economy’s largest business city. For 11 Attorney fees economies the data are also collected for the second largest business city. - The buyer orders custom-made goods, then fails to pay. Court fees - The value of the dispute is 200% of the income per capita or the Enforcement fees equivalent in local currency of USD 5,000, whichever is greater. Quality of judicial processes index (0-18) - The seller sues the buyer before the court with jurisdiction over commercial cases worth 200% of income per capita or $5,000. Court structure and proceedings (-1-5) - The seller requests a pretrial attachment to secure the claim. Case management (0-6) - The dispute on the quality of the goods requires an expert opinion. Court automation (0-4) - The judge decides in favor of the seller; there is no appeal. Alternative dispute resolution (0-3) - The seller enforces the judgment through a public sale of the buyer’s movable assets. Standardized Case Claim value EUR 53,754.00 Court name Rome District Court City Covered Rome OECD high OECD high Indicator Italy income income Overall Best Performer Time (days) 1120 577.8 577.8 164.00 (Singapore) Cost (% of claim value) 23.1 21.5 21.5 9.00 (Iceland) Quality of judicial processes index (0-18) 13.0 11.0 11.0 15.50 (Australia) Figure – Enforcing Contracts in Italy and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 71.32: Germany (Rank: 22) 69.97: Spain (Rank: 26) 66.76: Regional Average (OECD high income) Page 52   of judicial processes Quality Business Doing index (0-18) 2018 Italy 13.0 11.0 11.0 15.50 (Australia) Figure – Enforcing Contracts in Italy and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 71.32: Germany (Rank: 22) 69.97: Spain (Rank: 26) 66.76: Regional Average (OECD high income) 66.49: Switzerland (Rank: 45) 64.25: Belgium (Rank: 52) 54.79: Italy (Rank: 108) Note: The ranking of economies on the ease of enforcing contracts is determined by sorting their distance to frontier scores for enforcing contracts. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Enforcing Contracts in Italy – Time and Cost Time Cost 1200 1120 30 1000 23.1 24.0 25 Cost (% of claim value) 21.5 800 18.0 20 Time (days) 17.2 14.4 577.8 600 505 499 510 510 15 400 10 200 5 0 0 Belgium Germany Italy OECD high income Spain Switzerland Figure – Enforcing Contracts in Italy and comparator economies – Measure of Quality Italy 3 4 3 3 Belgium 2.5 1 0 4.5 Germany 3 1.5 2 4.5 Spain 3 2.5 2.5 3 Switzerland 2.5 1 2.5 4.5 OECD high income 2.5 2.9 2 3.6 0 2 4 6 8 10 12 Page 53   14 0 0 Belgium Germany Italy OECD high income Spain Switzerland Doing Business 2018 Italy Figure – Enforcing Contracts in Italy and comparator economies – Measure of Quality Italy 3 4 3 3 Belgium 2.5 1 0 4.5 Germany 3 1.5 2 4.5 Spain 3 2.5 2.5 3 Switzerland 2.5 1 2.5 4.5 OECD high income 2.5 2.9 2 3.6 0 2 4 6 8 10 12 14 Sub-Indicator Score Alternative dispute resolution (0­3) Case management (0­6) Court automation (0­4) Court structure and proceedings (­1­5) Details – Enforcing Contracts in Italy Indicator Time (days) 1120 Filing and service 10 Trial and judgment 840 Enforcement of judgment 270 Cost (% of claim value) 23.1 Attorney fees 15 Court fees 2.9 Enforcement fees 5.2 Quality of judicial processes index (0-18) 13.0 Court structure and proceedings (-1-5) 3.0 Case management (0-6) 4.0 Court automation (0-4) 3.0 Alternative dispute resolution (0-3) 3.0 Details – Enforcing Contracts in Italy – Measure of Quality Page 54   Alternative dispute resolution (0-3) 3.0 Doing Business 2018 Italy Details – Enforcing Contracts in Italy – Measure of Quality Answer Score Quality of judicial processes index (0-18) 13.0 Court structure and proceedings (-1-5) 3.0 1. Is there a court or division of a court dedicated solely to hearing commercial cases? No 0.0 2. Small claims court 1.5 2.a. Is there a small claims court or a fast-track procedure for small claims? Yes 2.b. If yes, is self-representation allowed? Yes 3. Is pretrial attachment available? Yes 1.0 4. Are new cases assigned randomly to judges? Yes, but manual 0.5 5. Does a woman's testimony carry the same evidentiary weight in court as a man's? Yes 0.0 Case management (0-6) 4.0 1. Time standards 1.0 1.a. Are there laws setting overall time standards for key court events in a civil case? Yes 1.b. If yes, are the time standards set for at least three court events? Yes 1.c. Are these time standards respected in more than 50% of cases? Yes 2. Adjournments 0.0 2.a. Does the law regulate the maximum number of adjournments that can be No granted? 2.b. Are adjournments limited to unforeseen and exceptional circumstances? No 2.c. If rules on adjournments exist, are they respected in more than 50% of cases? n.a. 3. Can two of the following four reports be generated about the competent court: (i) Yes 1.0 time to disposition report; (ii) clearance rate report; (iii) age of pending cases report; and (iv) single case progress report? 4. Is a pretrial conference among the case management techniques used before the No 0.0 competent court? 5. Are there any electronic case management tools in place within the competent court Yes 1.0 for use by judges? 6. Are there any electronic case management tools in place within the competent court Yes 1.0 for use by lawyers? Court automation (0-4) 3.0 1. Can the initial complaint be led electronically through a dedicated platform within Yes 1.0 the competent court? 2. Is it possible to carry out service of process electronically for claims led before the Yes 1.0 competent court? Page 55   1. Can the initial complaint be led electronically through a dedicated platform within Yes 1.0 Businesscourt? the competent Doing 2018 Italy 2. Is it possible to carry out service of process electronically for claims led before the Yes 1.0 competent court? 3. Can court fees be paid electronically within the competent court? Yes 1.0 4. Publication of judgments 0.0 4.a Are judgments rendered in commercial cases at all levels made available to the No general public through publication in o cial gazettes, in newspapers or on the internet or court website? 4.b. Are judgments rendered in commercial cases at the appellate and supreme No court level made available to the general public through publication in o cial gazettes, in newspapers or on the internet or court website? Alternative dispute resolution (0-3) 3.0 1. Arbitration 1.5 1.a. Is domestic commercial arbitration governed by a consolidated law or Yes consolidated chapter or section of the applicable code of civil procedure encompassing substantially all its aspects? 1.b. Are there any commercial disputes—aside from those that deal with public No order or public policy—that cannot be submitted to arbitration? 1.c. Are valid arbitration clauses or agreements usually enforced by the courts? Yes 2. Mediation/Conciliation 1.5 2.a. Is voluntary mediation or conciliation available? Yes 2.b. Are mediation, conciliation or both governed by a consolidated law or Yes consolidated chapter or section of the applicable code of civil procedure encompassing substantially all their aspects? 2.c. Are there nancial incentives for parties to attempt mediation or conciliation (i.e., Yes if mediation or conciliation is successful, a refund of court ling fees, income tax credits or the like)? Resolving Insolvency Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist Intelligence Unit. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to recover debt (years) To make the data on the time, cost and outcome comparable across economies, several assumptions about the business and the case are Measured in calendar years used: Appeals and requests for extension are included - A hotel located in the largest city (or cities) has 201 employees and 50 Cost required to recover debt (% of debtor’s estate) suppliers. The hotel experiences nancial di culties. Page 56   Measured as percentage of estate value - The value of the hotel is 100% of the income per capita or the equivalent if mediation or conciliation is successful, a refund of court ling fees, income tax credits or the like)? Doing Business 2018 Italy Resolving Insolvency Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist Intelligence Unit. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to recover debt (years) To make the data on the time, cost and outcome comparable across economies, several assumptions about the business and the case are Measured in calendar years used: Appeals and requests for extension are included - A hotel located in the largest city (or cities) has 201 employees and 50 Cost required to recover debt (% of debtor’s estate) suppliers. The hotel experiences nancial di culties. Measured as percentage of estate value - The value of the hotel is 100% of the income per capita or the equivalent Court fees in local currency of USD 200,000, whichever is greater. - The hotel has a loan from a domestic bank, secured by a mortgage over Fees of insolvency administrators the hotel’s real estate. The hotel cannot pay back the loan, but makes Lawyers’ fees enough money to operate otherwise. Assessors’ and auctioneers’ fees In addition, Doing Business evaluates the adequacy and integrity of the Other related fees existing legal framework applicable to liquidation and reorganization Outcome proceedings through the strength of insolvency framework index. The index tests whether economies adopted internationally accepted good Whether business continues operating as a going practices in four areas: commencement of proceedings, management of concern or business assets are sold piecemeal debtor’s assets, reorganization proceedings and creditor participation. Recovery rate for creditors Measures the cents on the dollar recovered by secured creditors Outcome for the business (survival or not) determines the maximum value that can be recovered Official costs of the insolvency proceedings are deducted Depreciation of furniture is taken into account Present value of debt recovered Strength of insolvency framework index (0- 16) Sum of the scores of four component indices: Commencement of proceedings index (0-3) Management of debtor’s assets index (0-6) Reorganization proceedings index (0-3) Creditor participation index (0-4) OECD high OECD high Indicator Italy income income Overall Best Performer Recovery rate (cents on the dollar) 64.6 71.2 71.2 93.1 (Norway) Time (years) 1.8 1.7 1.7 0.4 (Ireland) Page 57   Cost (% of estate) 22.0 9.1 9.1 1.00 (Norway) Creditor participation index (0-4) Doing Business 2018 Italy OECD high OECD high Indicator Italy income income Overall Best Performer Recovery rate (cents on the dollar) 64.6 71.2 71.2 93.1 (Norway) Time (years) 1.8 1.7 1.7 0.4 (Ireland) Cost (% of estate) 22.0 9.1 9.1 1.00 (Norway) Outcome (0 as piecemeal sale and 1 as going 1 .. .. .. concern) Strength of insolvency framework index (0-16) 13.5 12.1 12.1 15.00 (6 Economies) Figure – Resolving Insolvency in Italy and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 90.27: Germany (Rank: 4) 81.46: Belgium (Rank: 11) 78.74: Spain (Rank: 19) 76.97: Italy (Rank: 24) 76.12: Regional Average (OECD high income) 62.63: Switzerland (Rank: 45) Note: The ranking of economies on the ease of resolving insolvency is determined by sorting their distance to frontier scores for resolving insolvency. These scores are the simple average of the distance to frontier scores for the recovery rate and the strength of insolvency framework index. Figure – Resolving Insolvency in Italy – Time and Cost Time Cost 3.5 25 22.0 3.0 3 20 2.5 Cost (% of estate) Time (years) 15 2 1.8 1.7 1.5 11.0 1.5 1.2 9.1 10 8.0 1 0.9 4.5 3.5 5 0.5 0 0 Belgium Germany Italy OECD high income Spain Switzerland Figure – Resolving Insolvency in Italy and comparator economies – Measure of Quality Italy 5.5 3 2 3 Page 58   0 0 Belgium Germany Italy OECD high income Spain Switzerland Doing Business 2018 Italy Figure – Resolving Insolvency in Italy and comparator economies – Measure of Quality Italy 5.5 3 2 3 Belgium 6 2.5 2 1 Germany 6 3 3 3 Spain 6 3 1 2 Switzerland 4 3 4 1 OECD high income 5.4 2.8 2.3 1.9 0 2 4 6 8 10 12 14 16 Sub-Indicator Score Management of debtor's assets index (0­6) Commencement of proceedings index (0­3) Creditor participation index (0­4) Reorganization proceedings index (0­3) Figure – Resolving Insolvency in Italy and comparator economies – Recovery Rate Recovery Rate (cents on the dollar) 90 84.6 80.6 80 76.6 71.2 70 64.6 60 50 46.7 40 30 20 10 0 Italy Belgium Germany Spain Switzerland OECD high income Details – Resolving Insolvency in Italy Indicator Answer Explanation Proceeding liquidation Mirage will file for reorganization (concordato preventivo) and benefit from the automatic (after an stay. Reorganization is the procedure that appears more suitable, as it helps preserve the attempt at business' continuity and therefore the value of the business and assets. In light of the severe reorganization) financial distress of Mirage and the negative expected cash flow for 2016 and 2017, there is the risk that the reorganization is not successfully completed and, consequently, it is converted into liquidation. In addition, currently the number of liquidation procedures in Italy continue to increase whereas the number of reorganizations decreases. Outcome going concern Selling the business as a going concern is the only way to maximize the value of the assets, so the creditors will be interested in a going concern sale. This principle is still valid in case of bankruptcy. Time (in years) 1.8 Under article 160 and followings of the Italian Bankruptcy Code, a solvent company in Page 59   Italy Belgium Germany Spain Switzerland OECD high income Doing Business 2018 Italy Details – Resolving Insolvency in Italy Indicator Answer Explanation Proceeding liquidation Mirage will file for reorganization (concordato preventivo) and benefit from the automatic (after an stay. Reorganization is the procedure that appears more suitable, as it helps preserve the attempt at business' continuity and therefore the value of the business and assets. In light of the severe reorganization) financial distress of Mirage and the negative expected cash flow for 2016 and 2017, there is the risk that the reorganization is not successfully completed and, consequently, it is converted into liquidation. In addition, currently the number of liquidation procedures in Italy continue to increase whereas the number of reorganizations decreases. Outcome going concern Selling the business as a going concern is the only way to maximize the value of the assets, so the creditors will be interested in a going concern sale. This principle is still valid in case of bankruptcy. Time (in years) 1.8 Under article 160 and followings of the Italian Bankruptcy Code, a solvent company in financial difficulty may enter into a composition with creditors (“concordato preventivo”). To enter into such procedure the debtor is required to file restructuring plan with the competent bankruptcy court. After the filing, the bankruptcy court assesses the documents and the feasibility of the plan as proposed in the course of the hearing. The court issues a decree which admits the company into a composition with creditors’ procedure. A delegated judge and a commissioner are appointed to handle the procedure. Under the case assumptions stated in the survey, the creditors are not likely to approve the plan and the procedure will be converted into the “fallimento” - a liquidation procedure. The aim of the fallimento is to satisfy the creditors’ rights and to remove the insolvent enterprise from the market. The fallimento starts when the company is deemed to be insolvent. A receiver is appointed by the competent court to manage the liquidation proceedings. The receiver must collect and sell the debtor’s assets under the judge’s direction and the creditors' surveillance. The competent bankruptcy court also appoints a judge who will be entitled to direct the proceeding and to resolve upon creditor’s claims. Insolvency proceedings will not take less than 1.8 years because of the large number of procedural steps required. Additionally, due to the financial crisis, the number of insolvency cases filed in Italy has increased, which put an additional burden on the courts. Cost (% of 22.0 Majority of expenses are made up of attorney's fees (around 10% of the value of the estate) estate) and fees of insolvency representatives (up to 10% of the value of the estate). The remaining 2% is divided between court fees, cost of notification and fees of other professionals involved in the insolvency proceedings (accountants, assessors, etc.). Recovery rate (cents on the 64.6 dollar) Details – Resolving Insolvency in Italy – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 13.5 Commencement of proceedings index (0-3) 3.0 What procedures are available to a DEBTOR when commencing insolvency (a) Debtor may 1.0 proceedings? le for both liquidation and reorganization Page 60   dollar) Doing Business 2018 Italy Details – Resolving Insolvency in Italy – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 13.5 Commencement of proceedings index (0-3) 3.0 What procedures are available to a DEBTOR when commencing insolvency (a) Debtor may 1.0 proceedings? le for both liquidation and reorganization Does the insolvency framework allow a CREDITOR to le for insolvency of the debtor? (a) Yes, a creditor 1.0 may le for both liquidation and reorganization What basis for commencement of the insolvency proceedings is allowed under the (a) Debtor is 1.0 insolvency framework? generally unable to pay its debts as they mature Management of debtor's assets index (0-6) 5.5 Does the insolvency framework allow the continuation of contracts supplying essential Yes 1.0 goods and services to the debtor? Does the insolvency framework allow the rejection by the debtor of overly burdensome Yes 1.0 contracts? Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0 Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0 Does the insolvency framework provide for the possibility of the debtor obtaining credit Yes 1.0 after commencement of insolvency proceedings? Does the insolvency framework assign priority to post-commencement credit? (a) Yes over all 0.5 pre- commencement creditors, secured or unsecured Reorganization proceedings index (0-3) 3.0 Which creditors vote on the proposed reorganization plan? (b) Only creditors 1.0 whose rights are a ected by the proposed plan Does the insolvency framework require that dissenting creditors in reorganization Yes 1.0 receive at least as much as what they would obtain in a liquidation? Are the creditors devided into classes for the purposes of voting on the reorganization Yes 1.0 plan, does each class vote separately and are creditors in the same class treated equally? Creditor participation index (0-4) 2.0 Page 61   Does the insolvency framework require that dissenting creditors in reorganization Yes 1.0 receive Doing at least as Business much as 2018 what they would obtain in a liquidation? Italy Are the creditors devided into classes for the purposes of voting on the reorganization Yes 1.0 plan, does each class vote separately and are creditors in the same class treated equally? Creditor participation index (0-4) 2.0 Does the insolvency framework require approval by the creditors for selection or Yes 1.0 appointment of the insolvency representative? Does the insolvency framework require approval by the creditors for sale of substantial No 0.0 assets of the debtor? Does the insolvency framework provide that a creditor has the right to request No 0.0 information from the insolvency representative? Does the insolvency framework provide that a creditor has the right to object to Yes 1.0 decisions accepting or rejecting creditors' claims? Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”. Labor Market Regulation Doing Business presents the data for the labor market regulation indicators in an annex. The report does not present rankings of economies on these indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business. Detailed data collected on labor market regulation are available on the Doing Business website (http://www.doingbusiness.org/data/exploretopics/labor-market-regulation). The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Hiring To make the data comparable across economies, several assumptions (i) whether xed-term contracts are prohibited for about the worker and the business are used. permanent tasks; (ii) maximum cumulative duration of xed-term contracts; (iii) length of the The worker: probationary period; (iv) minimum wage. - Is a cashier in a supermarket or grocery store, age 19, with one year of work experience. Working hours - Is a full-time employee. (i) maximum number of working days allowed per - Is not a member of the labor union, unless membership is mandatory. week; (ii) premiums for work: at night, on a weekly rest day and overtime; (iii) whether there are The business: restrictions on work at night, work on a weekly rest - Is a limited liability company (or the equivalent in the economy). day and for overtime work; (iv) whether nonpregnant - Operates a supermarket or grocery store in the economy’s largest and nonnursing women can work same night hours business city. For 11 economies the data are also collected for the second as men; (v) length of paid annual leave. largest business city. - Has 60 employees. Redundancy rules - Is subject to collective bargaining agreements if such agreements cover (i) whether redundancy can be basis for terminating more than 50% of the food retail sector and they apply even to rms that workers; (ii) whether employer needs to notify are not party to them. and/or get approval from third party to terminate 1 - Abides by every law and regulation but does not grant workers more redundant worker and a group of 9 redundant bene ts than those mandated by law, regulation or (if applicable) collective workers; (iii) whether law requires employer to bargaining agreements. reassign or retrain a worker before making worker redundant; (iv) whether priority rules apply for redundancies and reemployment. Redundancy cost Page 62   (i) notice period for redundancy dismissal; (ii) the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”. Doing Business 2018 Italy Labor Market Regulation Doing Business presents the data for the labor market regulation indicators in an annex. The report does not present rankings of economies on these indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business. Detailed data collected on labor market regulation are available on the Doing Business website (http://www.doingbusiness.org/data/exploretopics/labor-market-regulation). The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Hiring To make the data comparable across economies, several assumptions (i) whether xed-term contracts are prohibited for about the worker and the business are used. permanent tasks; (ii) maximum cumulative duration of xed-term contracts; (iii) length of the The worker: probationary period; (iv) minimum wage. - Is a cashier in a supermarket or grocery store, age 19, with one year of work experience. Working hours - Is a full-time employee. (i) maximum number of working days allowed per - Is not a member of the labor union, unless membership is mandatory. week; (ii) premiums for work: at night, on a weekly rest day and overtime; (iii) whether there are The business: restrictions on work at night, work on a weekly rest - Is a limited liability company (or the equivalent in the economy). day and for overtime work; (iv) whether nonpregnant - Operates a supermarket or grocery store in the economy’s largest and nonnursing women can work same night hours business city. For 11 economies the data are also collected for the second as men; (v) length of paid annual leave. largest business city. - Has 60 employees. Redundancy rules - Is subject to collective bargaining agreements if such agreements cover (i) whether redundancy can be basis for terminating more than 50% of the food retail sector and they apply even to rms that workers; (ii) whether employer needs to notify are not party to them. and/or get approval from third party to terminate 1 - Abides by every law and regulation but does not grant workers more redundant worker and a group of 9 redundant bene ts than those mandated by law, regulation or (if applicable) collective workers; (iii) whether law requires employer to bargaining agreements. reassign or retrain a worker before making worker redundant; (iv) whether priority rules apply for redundancies and reemployment. Redundancy cost (i) notice period for redundancy dismissal; (ii) severance payments due when terminating a redundant worker. Job quality (i) whether law mandates equal remuneration for work of equal value and nondiscrimination based on gender in hiring; (ii) whether law mandates paid or unpaid maternity leave; (iii) length of paid maternity leave; (iv) whether employees on maternity leave receive 100% of wages; (v) availability of ve fully paid days of sick leave a year; (vi) eligibility requirements for unemployment protection. Details – Labor Market Regulation in Italy Answer Hiring Page 63   Fixed-term contracts prohibited for permanent tasks? No days of sick leave a year; (vi) eligibility requirements for unemployment protection. Doing Business 2018 Italy Details – Labor Market Regulation in Italy Answer Hiring Fixed-term contracts prohibited for permanent tasks? No Maximum length of a single xed-term contract (months) 36.0 Maximum length of xed-term contracts, including renewals (months) 36.0 Minimum wage applicable to the worker assumed in the case study (US$/month) 1973.7 Ratio of minimum wage to value added per worker 0.5 Maximum length of probationary period (months) 2.0 Working hours Standard workday 6.6 Maximum number of working days per week 6.0 Premium for night work (% of hourly pay) 15.0 Premium for work on weekly rest day (% of hourly pay) 30.0 Premium for overtime work (% of hourly pay) 15.0 Restrictions on night work? No Whether nonpregnant and nonnursing women can work the same night hours as men Yes Restrictions on weekly holiday? No Restrictions on overtime work? No Paid annual leave for a worker with 1 year of tenure (working days) 26.0 Paid annual leave for a worker with 5 years of tenure (working days) 26.0 Paid annual leave for a worker with 10 years of tenure (working days) 26.0 Paid annual leave (average for workers with 1, 5 and 10 years of tenure, in working days) 26.0 Redundancy rules Dismissal due to redundancy allowed by law? Yes Third-party noti cation if one worker is dismissed? Yes Third-party approval if one worker is dismissed? No Third-party noti cation if nine workers are dismissed? Yes Third-party approval if nine workers are dismissed? No Retraining or reassignment obligation before redundancy? Yes Page 64   Third-party Doing approval Business 2018 if nine workers are dismissed? Italy No Retraining or reassignment obligation before redundancy? Yes Priority rules for redundancies? Yes Priority rules for reemployment? Yes Redundancy cost Notice period for redundancy dismissal for a worker with 1 year of tenure 2.9 Notice period for redundancy dismissal for a worker with 5 years of tenure 4.3 Notice period for redundancy dismissal for a worker with 10 years of tenure 6.4 Notice period for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 4.5 Severance pay for redundancy dismissal for a worker with 1 year of tenure 0.0 Severance pay for redundancy dismissal for a worker with 5 years of tenure 0.0 Severance pay for redundancy dismissal for a worker with 10 years of tenure 0.0 Severance pay for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 0.0 Job quality Equal remuneration for work of equal value? Yes Gender nondiscrimination in hiring? No Paid or unpaid maternity leave mandated by law? Yes Minimum length of maternity leave (calendar days)? 150.0 Receive 100% of wages on maternity leave? No Five fully paid days of sick leave a year? No Unemployment protection after one year of employment? Yes Minimum contribution period for unemployment protection (months)? 3.0 Business Reforms in Italy In the year ending June 1, 2017, 119 economies implemented 264 total reforms across the di erent areas measured by Doing Business. Doing Business has recorded more than 2,900 regulatory reforms making it easier to do business since 2004. Reforms inspired by Doing Business have been implemented by economies in all regions. The following are the reforms for Italy implemented since Doing Business 2008. = Doing Business reform making it easier to do business. = Change making it more di cult to do business. DB2018 Getting Electricity: Italy made getting electricity easier by streamlining the application process and reducing the time for the external works and meter installation. Paying Taxes: Italy made paying taxes less costly by temporarily exempting employers from social security contributions. Italy also made paying taxes easier by abolishing the VAT communication form. DB2017 Page 65   Paying Taxes: Italy made paying taxes easier by allowing full cost of labor to be deductible for regional tax on productive activities Minimum contribution period for unemployment protection (months)? 3.0 Doing Business 2018 Italy Business Reforms in Italy In the year ending June 1, 2017, 119 economies implemented 264 total reforms across the di erent areas measured by Doing Business. Doing Business has recorded more than 2,900 regulatory reforms making it easier to do business since 2004. Reforms inspired by Doing Business have been implemented by economies in all regions. The following are the reforms for Italy implemented since Doing Business 2008. = Doing Business reform making it easier to do business. = Change making it more di cult to do business. DB2018 Getting Electricity: Italy made getting electricity easier by streamlining the application process and reducing the time for the external works and meter installation. Paying Taxes: Italy made paying taxes less costly by temporarily exempting employers from social security contributions. Italy also made paying taxes easier by abolishing the VAT communication form. DB2017 Paying Taxes: Italy made paying taxes easier by allowing full cost of labor to be deductible for regional tax on productive activities (IRAP) purposes, as well as updating coe cients used for calculation of tax on real estate (IMU) and municipal service tax (TASI). Furthermore, electronic system for preparing and paying labor taxes was improved. DB2016 Enforcing Contracts: Italy made enforcing contracts easier by introducing a mandatory electronic ling system for court users, simplifying the rules for electronic service of process and automating the enforcement process. Labor Market Regulation: Italy adopted the Jobs Act, which simpli es redundancy rules and encourages out-of-court reconciliation, reducing the time and cost for resolving labor disputes. The new legislation also broadens the coverage of unemployment insurance. DB2015 Starting a Business: Italy made starting a business easier by reducing both the minimum capital requirement and the paid-in minimum capital requirement and by streamlining registration procedures. Labor Market Regulation: Italy relaxed the conditions for using xed-term contracts but reduced their maximum duration to 36 months. DB2014 Registering Property: Italy made transferring property easier by eliminating the requirement for an energy performance certi cate for commercial buildings with no heating system. Enforcing Contracts: Italy made enforcing contracts easier by regulating attorneys’ fees and streamlining some court proceedings. Resolving Insolvency: Italy made resolving insolvency easier through an amendment to its bankruptcy code that introduces a stay period for enforcement actions while the debtor is preparing a restructuring plan, makes it easier to convert from one type of restructuring proceeding to another, facilitates continued operation by the debtor during restructuring and imposes stricter requirements on auditors evaluating a restructuring plan. DB2013 Getting Electricity: Italy made getting electricity easier and less costly by improving the e ciency of the utility Acea Distribuzione and reducing connection fees. Registering Property: Italy made transferring property easier by digitizing cadastral maps of properties and making the maps available to notaries online. DB2012 Resolving Insolvency: Italy introduced debt restructuring and reorganization procedures as alternatives to bankruptcy Page 66   proceedings and extended further rights to secured creditors during insolvency proceedings. Doing Business 2018 DB2012 Italy Resolving Insolvency: Italy introduced debt restructuring and reorganization procedures as alternatives to bankruptcy proceedings and extended further rights to secured creditors during insolvency proceedings. DB2011 Starting a Business: Italy made starting a business easier by enhancing an online registration system. DB2010 Labor Market Regulation: Italy allowed the use of xed-term contracts for permanent tasks. DB2009 Starting a Business: Italy made starting a business easier by making it possible to carry out all required procedures through a single notice. Paying Taxes: Italy made paying taxes less costly for companies by reducing the corporate income tax (IRES) rate and the regional tax on productive activities (IRAP) rate. Labor Market Regulation: Italy increased the notice period for redundancy dismissals. DB2008 Resolving Insolvency: Italy enhanced its insolvency process through new legislation that gives trustees greater discretion in liquidating assets and grants creditors the right to propose arrangements for other creditors to take over distressed assets, which may shorten the liquidation procedure. Page 67   liquidating assets and grants creditors the right to propose arrangements for other creditors to take over distressed assets, which may shorten Doing 2018 procedure. the liquidation Business Italy Page 68