Foreign investors who wish to start a business in Italy have several different options to
choose from, each with its own pros and cons.

The incorporation process is governed by the Italian Civil Code and its several relevant legal provisions. Investors interested in starting a business in Italy will have to pay attention not only to the most suitable type of legal entities, but also to the applicable taxation, the reporting requirements, the level of protection afforded to its members.

The business vehicles most commonly used by foreign investors interested in doing
business in Italy are the following:

1) Partnership: General or Limited

Two or more partners can open a general or limited partnership. The company does
not have legal personality and therefore each partner has unlimited responsibility for
the company’s debts.

2) Limited Liability Company

The most popular business structure, suitable for small and medium sized businesses. The shareholders’ liability is limited to their contributions to the company.

3) Corporation

Suitable for larger business ventures and stock exchange listings. It requires a larger
capital compared to the Limited Liability Company and has more complex governance
requirements.

4) Branch

An extension of a foreign company in Italy. It does not have a legal personality, and the
foreign company is fully liable for the debts of its Italian branch.

5) Representative Office

The representative office is only a local presence established to promote the foreign
company’s activities on the Italian market. It can only be used for non-commercial
purposes.