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requirements by disclosing to the public the sole ownership in the company. The main provisions regarding the governance and the capital of a S.p.A. are regulated by the articles of association, which are approved by the shareholders at the time of incorporation and may be amended only by a resolution of the extraordinary meeting of the shareholders, requiring enhanced voting majority. The management of an S.p.A is typically managed by a board of directors, appointed by the shareholders. The board of directors is responsible for the daily operations and decision-making of the company. Their powers and duties are defined by the Italian Civil Code (Articles 2380 to 2396) and the company's bylaws. In addition to the board of directors, an S.p.A must have a board of statutory auditors, which is responsible for overseeing the company's financial activities and ensuring compliance with relevant laws and regulations. The board of statutory auditors is governed by Articles 2397 to 2409 of the Italian Civil Code. Shareholders exercise their rights and control over the company through general meetings, where they vote on various resolutions, such as appointing directors and auditors, approving financial statements, and amending the company's bylaws. Shareholders' meetings are regulated by Articles 2363 to 2379 - ter of the Italian Civil Code. In addition to the above, it should be noted that stricter legal provisions have been established by the Italian Civil Code with respect to those particular S.p.A. whose stock is traded on one of the official
regulated markets or is highly capitalized and diffused on the market. 3.1.2 “Società a Responsabilità Limitata” (S.r.l.) An S.r.l. is a popular choice for small and medium-sized businesses in Italy, as it offers a flexible management structure and limited liability protection for its shareholders. Governed by Articles 2462 to 2483 of the Italian Civil Code, a S.r.l. can be established with one or more shareholders, and the company's capital is divided into quotas, which represent the ownership interests of the shareholders. The minimum share capital for a S.r.l. is €1, with no maximum limit. The equity participation in the S.r.l.’s capital is not represented by shares, but by quotas. Such quotas are “immaterial,” i.e., they cannot be incorporated into certificates, with the result that the circulation and the transfer of the same are subject to more strictly formal requirements. In general terms, the S.r.l. is characterized by a greater freedom granted in favor of the quotaholders to establish the internal organizational rules of the company, and to create a flexible structure adapted to their peculiar needs. The flexibility of its structure, along with the lower costs required for the incorporation and management of the S.r.l., as opposed to the S.p.A., makes the former the most suitable and commonly used corporate form to start and run small/medium size businesses. The management of an S.r.l. can be overseen by one or more directors, who may or may not be shareholders. Directors are appointed by the shareholders and are responsible for the daily operations and
ILN Corporate Group – Establishing a Business Entity Series
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