The European Commission has announced that it will open an infringement procedure for Italy due to the way the golden power law works. The issue was raised by Unicredit, after the Government largely limited the margins of its Ops on Banco Bpm precisely by using this regulation, which in the past had already been considered excessive and in violation of European law.
Economy Minister Giancarlo Giorgetti declared that the Government is already working to change the law. The new rule could be approved directly through the Financial Maneuver, to speed up the process and align with EU requests. With these decisions, however, Unicredit’s case before the Council of State gains strength.
The EU rejects Italy’s golden power
The European Union has sent a letter of formal notice against Italy for the use, deemed contrary to European law, of the law on golden power. Commissioner Maria Luis Albuquerque explained, in a note sent to the Government:
The legislation, as applied by the Italian authorities, risks allowing unjustified interventions for economic reasons, which compromise the principles of freedom of establishment and free movement of capital in the single market. Furthermore, Italian law overlaps with the exclusive competences of the ECB within the Single Supervisory Mechanism.
Golden power is a principle widespread in many states, whereby a government can block the acquisition of a company that it deems of national strategic importance, if this operation was made by a foreign company. This is a rule that should serve to protect national security, but according to the EU, Italy has made inappropriate use of it.
Giorgetti ready to change the law
The Government immediately showed its willingness to change the law. Even before the European Commission’s pronouncement, several members of the Executive and the majority had issued conciliatory statements. Following the sending of the letter, it was Minister Giorgetti who certified the opening, declaring:
The Commission raises objections to the so-called golden power rule, reformed in 2022 with the Draghi government. On the basis of the evaluations of the sentence, we will respond to the comments made to us in the competent bodies. With a constructive and collaborative spirit we will make a regulatory proposal that will provide clarity and overcome objections. We are convinced that it will allow us to have a shared framework of skills.
Unicredit’s appeal is strengthened
The EU’s decision and the Government’s choice not to contest it could have an immediate effect on Unicredit’s appeal against the use of golden power by the Executive in its Ops on the shares of Banco Bpm. The bank in Piazza Gae Aulenti has decided to bring before the Council of State the ruling of the Lazio Regional Administrative Court which annulled only part of the restrictions applied by the Government to the operation.
In fact, Unicredit believes that the entire rule is illegitimate and now the arguments of the credit institution led by Andrea Orcel are much more solid, given that the law would violate European law. A ruling in favor of Unicredit could reopen the banking risk and lead to a second attempt to acquire BPM.
