Milan, 2020-05-18

Italy was the first country in Europe to be affected by the coronavirus and to particularly high degree. The measures adopted by the Italian Government were extremely strict and imposed severe restrictions.

The first relaxations (so-called Phase 2) came into force with the government decree of 26 April 2020. In particular, they included the possibility of visiting relatives (the term "relatives" was defined broadly to include not only family members) and of exercising alone outdoors. Public parks and gardens have also been reopened. It was also decided that funerals and mourning ceremonies with a maximum of 15 people in attendance are allowed to take place again. Visits to retirement homes are also possible again under certain circumstances.

Production plants have been able to reopen since 4 May, and the retail trade since 18 May. However, there may be differences at the regional level, as the regions also have their own decision-making powers in implementing the relaxation, is due to cultural and climatic differences between the regions on the one hand and the varying levels of infection on the other.

Several measures and assistance are planned to support companies and the self-employed and to protect them from bankruptcy: Fully or partially state-guaranteed financing is granted, provided that the companies were not already in default at the start of the Corona crisis and that the amount of financing does not exceed 25% of the company's turnover in the financial year. In detail there are:

• State-guaranteed loans of up to EUR 25,000.00 for small and medium-sized enterprises, without verification by credit institutions and based solely on the information provided by the applicant,
• Loans of up to EUR 800,000.00 for companies with up to 499 employees, 90% of which are secured by the state and 10% by a consortium of banks,
• 90% state- guaranteed loans of up to EUR 5 million for companies with up to 499 employees

There are also favourable financing options for larger companies, also graded according to turnover and number of employees. The state fund that secures the financing is different from that for the smaller companies listed above.

In addition, grants are provided for companies with annual turnover of no more than EUR 5 million, with the amount of the grants varying between 10% and 20% of the loss of turnover realised in April 2020 compared to April 2019, depending on the size of the company. The grants are at least EUR 1,000.00 for natural persons (self-employed, entrepreneurs) and at least EUR 2,000.00 for legal entities.

There are also regional measures for the protection of enterprises and the legislator has extended or suspended payment deadlines for taxes and duties.

Author: Dr. Stefanie Mehrens, attorney at law

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