Private Equity Lawyers Italy 2026: Decree 58/98 Reform, Fund‑vehicle Choice, Fund Finance & Tax

The landscape for private equity lawyers Italy practitioners advise on has shifted materially in 2026. The parliamentary reform of Legislative Decree No. 58/1998, the Testo Unico della Finanza (TUF), introduces the società di investimento as a new corporate‑form fund vehicle, while the 2026 Budget Law (Legge di Bilancio 2026) recalibrates participation‑exemption thresholds under Article 87 TUIR with direct consequences for deal economics. Alongside these domestic changes, Italy’s transposition of AIFMD II reshapes licensing, marketing and direct‑lending rules for alternative‑investment fund managers. This guide translates each reform into operational checklists for GPs launching funds, lenders structuring fund‑finance facilities, and in‑house counsel navigating the transition.

TL;DR, Key Decisions for GPs, Lenders and Fund Counsel

• What changes. The Decree 58/98 reform permits Italian PE funds to be organised as corporate‑form società di investimento, not only as unincorporated fondi comuni. The 2026 Budget Law amends the participation‑exemption regime under Article 87 TUIR, and Italy’s AIFMD II transposition introduces new rules for credit funds and direct lending.
• Immediate choice for GPs. Every new fund launch must evaluate whether a società structure, a traditional fondo comune, or a foreign LP wrapper best serves its investor base, tax profile and financing needs, see the executive decision checklist below.
• Immediate concern for lenders. Security packages, upstream‑guarantee enforceability and covenant mechanics differ significantly depending on the vehicle form chosen, fund finance counsel should reassess template documentation now.
• Recommended next step. Engage qualified Italian PE counsel to model the regulatory, tax and fund‑finance impact of vehicle choice before committing to a structure. Find a private equity lawyer through the Global Law Experts directory.

Executive Decision Checklist: Which Fund Vehicle to Choose Now

The Decree 58/98 reform expands the toolbox available for fund structuring Italy 2026 launches. The checklist below maps the principal decision drivers to the vehicle form most likely to satisfy them.

• Ticket size and investor base. Institutional‑only investor pools with cross‑border participants often favour the foreign LP model or a fondo comune with a well‑known management company. Mixed institutional/family‑office bases may benefit from the governance transparency of the new società di investimento.
• Tax optimisation goals. If the GP intends to rely on the participation‑exemption regime (Article 87 TUIR), the interaction between fund vehicle form and the 2026 Budget Law thresholds must be modelled, see Tax Consequences below.
• Fund‑finance needs. Sponsors planning capital‑call facilities or NAV lending should assess whether lenders can take corporate‑level security (easier under a società) or must rely on contractual pledges over fund interests (typical for a fondo comune).
• EU passporting. Managers requiring cross‑border marketing under the AIFMD passport should evaluate whether the Italian vehicle qualifies as an AIF under the new AIFMD II‑aligned regime.
• Governance flexibility. The società vehicle allows statutory share classes, voting‑right differentiation, and corporate board structures familiar to international investors. The fondo comune offers contractual flexibility through its fund rules (regolamento del fondo).
• Speed to market. Transitional provisions may favour launching under the fondo comune structure in the near term while secondary legislation for the società vehicle is finalised.

Background and Legislative Timeline: Decree 58/1998 (TUF), the 2026 Budget Law and AIFMD II

Italy’s collective‑investment regime has historically been governed by Legislative Decree No. 58 of 24 February 1998 (TUF), supplemented by implementing regulations from CONSOB and the Banca d’Italia. Under the pre‑reform framework, Italian alternative investment funds (AIFs) could only be established as fondi comuni di investimento, segregated pools of assets managed by an authorised asset‑management company (SGR), or as SICAVs/SICAFs for open‑ and closed‑end purposes respectively. Private equity funds in Italy have traditionally operated as closed‑end fondi comuni.

The comprehensive reform of the TUF, described by the Banca d’Italia as “an important part” of the broader modernisation of Italian financial regulation, introduces significant statutory flexibility so that the capital structure of a fund vehicle can be shaped around the specific characteristics of the investment strategy. The centrepiece relevant to PE sponsors is the codification of the società di investimento, a corporate‑form vehicle analogous to the Luxembourg SCSp or the Anglo‑Saxon limited partnership, but embedded in Italian company law.

Running in parallel, the 2026 Budget Law private equity stakeholders must track modifies the Testo Unico delle Imposte sui Redditi (TUIR), adjusting thresholds and conditions for the participation exemption under Article 87. The AIFMD II transposition, which forms part of the broader process of aligning Italian law with EU‑level innovations, introduces a dedicated regulatory framework for credit funds and direct lending.

Key Dates and Legislative Milestones

Industry observers expect the secondary implementing regulations to be adopted in the second half of 2026, meaning GPs planning a near‑term fund launch should monitor CONSOB and Banca d’Italia publications closely. Transitional provisions in the reform bill are expected to allow existing fondi comuni to continue operating under current rules while providing a conversion pathway for managers who wish to adopt the società form.

Fund Vehicle Options Post‑Reform: Private Equity Lawyers Italy Comparison Guide

The Decree 58/98 reform fundamentally changes the menu of fund vehicles società structures available to Italian PE sponsors. This section compares the three principal options in detail.

Società di Investimento, Mechanics

The società di investimento is a corporate‑form vehicle with separate legal personality. It is registered with the Companies Register (Registro delle Imprese) and subject to Italian company‑law governance, including board‑of‑directors structures, statutory auditors and formal shareholder meetings. The reform provides significant statutory flexibility so that the capital structure can be shaped around the specific characteristics of the investment strategy, according to analysis by WTS. Key features include the ability to issue multiple share classes with differentiated economic and voting rights, making it possible to replicate GP/LP economics within a corporate framework. The vehicle holds assets on its own balance sheet, simplifying transfers and disposals of portfolio companies.

Fondo Comune di Investimento, Mechanics

The traditional fondo comune remains available and will continue to be the default structure for many Italian PE managers. It is an unincorporated pool of assets without separate legal personality, managed by a licensed SGR or AIFM. Governance is contractual, defined by the fund rules (regolamento del fondo) rather than by company law. Investors hold units (quote) that represent pro‑rata interests in the fund’s net assets. A depositary is required. The fondo comune structure is well understood by Italian institutional investors and benefits from established regulatory and tax precedent.

Cross‑Border Fund Wrappers

Foreign limited partnerships, typically Luxembourg SCSps or UK/English LPs, managed from Italy continue to be common for pan‑European strategies. Under the reformed TUF and AIFMD II transposition, a foreign AIF marketed to Italian investors may require the local establishment of a management company or branch, or compliance with national private‑placement rules. Fund finance in Italy considerations for foreign wrappers are distinct: lender enforcement depends primarily on the governing law of the foreign vehicle, and security is typically taken over the portfolio companies rather than the fund interests themselves.

Three‑Column Comparison Table: Vehicle Selection at a Glance

Tax Consequences: 2026 Budget Law and Participation Exemption (Article 87 TUIR)

The 2026 Budget Law recalibrates several provisions of the TUIR that directly affect private equity deal economics. For private equity lawyers Italy practitioners counsel, the most consequential change concerns the participation‑exemption regime under Article 87 TUIR.

Participation Exemption Thresholds and Worked Example

The participation exemption (partecipation exemption, or PEX) allows corporate taxpayers to exclude a substantial portion of capital gains realised on the disposal of qualifying shareholdings from the corporate‑income‑tax base. Under the long‑standing regime, Article 87 TUIR requires that several conditions be met simultaneously: the shareholding must have been held continuously for at least 12 months; it must have been classified as a financial fixed asset (immobilizzazione finanziaria) in the first set of financial statements after acquisition; the target company must not be resident in a low‑tax jurisdiction; and the target must carry on a genuine commercial activity.

The 2026 Budget Law adjusts the interaction between these conditions and the treatment of dividends and capital gains flowing through fund vehicles. For domestic corporate investors, the exempt portion of qualifying capital gains remains significant, but the Budget Law tightens anti‑avoidance provisions targeting structures designed to convert ordinary income into PEX‑eligible gains. GPs structuring exits must verify that the holding‑period and classification requirements are met at the relevant entity level, which, under the new società vehicle, means at the fund‑company level rather than at the SGR level.

Worked example: A società di investimento acquires a 100% stake in PortfolioCo for EUR 20 million in January 2026, classifying it as a financial fixed asset. In March 2027 (14 months later), it sells the stake for EUR 35 million. If all Article 87 TUIR conditions are satisfied, the EUR 15 million capital gain is substantially exempt from IRES. However, if the vehicle is a fondo comune, the tax analysis shifts: Italian resident funds benefit from a separate tax regime where fund‑level income is generally exempt, with taxation deferred to investor‑level distributions. The vehicle‑choice decision therefore requires modelling both entity‑level and investor‑level tax outcomes.

VAT and Transfer‑Tax Triggers

The transfer of shares in portfolio companies is generally exempt from VAT under Italian law. However, transfers of real‑estate‑rich companies or assets may trigger proportional registration tax, mortgage tax and cadastral tax. The vehicle form can affect the availability of restructuring reliefs and the characterisation of transfers for indirect‑tax purposes. Fund counsel should map indirect‑tax consequences alongside income‑tax modelling at the structuring stage.

Withholding and Treaty Considerations

Dividends distributed by Italian portfolio companies to an Italian fund vehicle are subject to different withholding‑tax treatments depending on the vehicle form. Distributions to a fondo comune managed by an Italian SGR are generally collected gross at fund level. Distributions to a società di investimento follow corporate‑dividend rules, with the potential application of the PEX regime to reduce the effective tax burden. Non‑resident LPs investing through any Italian vehicle should review applicable double‑tax treaty provisions and EU directive protections (Parent‑Subsidiary Directive) to optimise withholding‑tax outcomes on distributions received from the fund.

Fund Finance Implications: Lenders’ Checklist and Common Covenant Revisions

The asset management regulatory reform changes the due‑diligence landscape for banks and alternative lenders providing capital‑call facilities, NAV facilities and portfolio‑level financing to Italian PE funds. Fund finance in Italy now requires lenders to differentiate their documentation and security packages by vehicle type.

Security Package Feasibility by Vehicle

For a società di investimento, the lender’s security package can include a pledge over the shares of portfolio companies held on the fund’s corporate balance sheet, an assignment of receivables (including capital‑call receivables from investors), and, subject to corporate‑law limitations on financial assistance under Articles 2358 and 2474 of the Italian Civil Code, upstream guarantees from the fund vehicle itself. The likely practical effect will be that società‑form funds offer lenders a cleaner enforcement pathway, since assets are held directly by a legal entity rather than in a segregated pool managed by a third‑party SGR.

For a fondo comune, the security package is necessarily contractual. Lenders take a pledge or charge over the fund units or over the capital‑call commitments of investors, but enforcement requires cooperation with (or step‑in rights against) the SGR. The depositary’s role as custodian of fund assets introduces an additional layer in any enforcement scenario. Intercreditor agreements must address the ranking of the lender’s claims relative to those of the depositary and other fund creditors.

For foreign LP wrappers, lender enforcement depends on the governing law of the vehicle. Italian‑law security is typically limited to pledges over Italian portfolio‑company shares, and lenders must ensure that cross‑border enforcement mechanisms (including recognition of foreign judgments or arbitral awards) are robust.

Sample Lender Checklist

• Vehicle‑form confirmation. Confirm whether the borrower is a società di investimento, fondo comune or foreign LP; obtain constitutional documents and fund rules.
• Capacity and authority opinions. Obtain Italian‑law legal opinions confirming the fund’s borrowing capacity and the authority of signatories (GP, board or SGR as applicable).
• Security package mapping. Map available security by vehicle type; for società, assess financial‑assistance limitations; for fondo, assess depositary cooperation requirements.
• Capital‑call mechanics. Review the LPA or fund rules for capital‑call procedures, investor default remedies and GP discretion, and ensure the facility agreement’s drawdown mechanics align.
• Covenant alignment. Adjust financial and information covenants to the regulatory reporting obligations of the vehicle, società vehicles file with the Companies Register; fondi report to CONSOB/Banca d’Italia via the SGR.
• Intercreditor terms. For fondo comune borrowers, negotiate intercreditor arrangements with the depositary and any other fund‑level creditors; specify step‑in rights and acceleration triggers.
• AIFMD II compliance. Confirm that the manager’s leverage policies comply with AIFMD II requirements and that the facility does not breach regulatory leverage limits.

Suggested Covenant Language Adjustments

Early indications suggest that lenders will need to revise several standard covenant formulations. Information covenants should require delivery of both corporate filings (for società) and regulatory reports (for fondi). Borrowing‑base or NAV‑coverage covenants must specify the valuation methodology and frequency aligned with the vehicle’s regulatory obligations. Event‑of‑default clauses should capture regulatory sanctions, licence revocations and SGR changes of control as trigger events alongside traditional financial defaults.

Registration, AIFMD II, Asset‑Management Reform and Operational Steps for GPs

The Banca d’Italia has emphasised that the reform of the regulatory framework for asset management is integral to Italy’s broader capital‑markets modernisation. For GPs and fund managers, this translates into a series of operational steps that must be planned and executed alongside vehicle‑choice and tax decisions.

Management Company Licensing

Any entity managing an Italian AIF, whether structured as a società di investimento or a fondo comune, must either hold an AIFM authorisation or delegate management to a licensed SGR or EU AIFM. The AIFMD II transposition introduces additional requirements for managers of credit funds, including specific risk‑management and origination policies. Managers intending to pursue direct‑lending strategies must comply with the new regulatory framework analysed by practitioners at firms such as Advant Nctm.

Required Filings Table

Passporting and Marketing

Under the AIFMD II‑aligned regime, Italian AIFMs managing Italian AIFs may passport their management and marketing activities across the EU using the standard notification procedure. The reform clarifies that both società di investimento and fondo comune vehicles qualify as AIFs for passporting purposes, provided the AIFM holds the requisite authorisation. Managers of non‑EU AIFs wishing to market in Italy must comply with Italy’s national private‑placement rules, which are also being updated as part of the TUF reform.

KYC, AML and Operational Compliance

All Italian AIFMs remain subject to Italy’s anti‑money‑laundering framework (Legislative Decree 231/2007), which requires investor due diligence, suspicious‑transaction reporting to the Unità di Informazione Finanziaria (UIF), and ongoing monitoring. The operational burden is comparable across vehicle types, although a società di investimento’s corporate structure may simplify certain beneficial‑ownership identification procedures relative to a fondo comune where investor information flows through the SGR.

Practical Drafting Checklist and Negotiation Pitfalls

Experienced private equity lawyers Italy sponsors rely on identify several drafting and negotiation areas that require immediate attention in light of the 2026 reforms.

• Subscription agreements. Update tax representations and warranties to reflect 2026 Budget Law changes; include specific reps on investor tax status relevant to participation‑exemption eligibility and withholding‑tax treaty claims.
• LPA / fund‑rule amendments. For new funds, draft constitutional documents with the chosen vehicle form in mind from inception. For existing fondi considering conversion to a società, review amendment mechanics and investor consent thresholds in current fund rules.
• Management company agreements. If the società di investimento delegates management to an external AIFM, the delegation agreement must comply with AIFMD II requirements on substance, oversight and sub‑delegation limitations.
• GP indemnities. Under a corporate società structure, GP indemnification provisions must be reconciled with Italian company‑law rules on director and officer liability, which differ materially from the contractual indemnities customary in Anglo‑Saxon LP structures.
• Fund finance side‑letter traps. Side letters granting most‑favoured‑nation rights, co‑investment rights or fee discounts to anchor investors must be reviewed for consistency with the fund’s borrowing documents. Lenders should require disclosure of material side letters affecting capital‑call timing or investor default remedies.
• Transitional provisions. Where a fund is launched during the transition period before secondary legislation is fully enacted, include fall‑back provisions allowing structural conversion once the implementing rules are finalised.

Conclusion: Recommended Next Steps for Private Equity Lawyers Italy Stakeholders

The convergence of the Decree 58/98 reform, the 2026 Budget Law and Italy’s AIFMD II transposition creates a compressed timeline for action. GPs, lenders and fund counsel should prioritise the following steps:

1. Model vehicle choice now. Run a combined regulatory, tax and fund‑finance analysis comparing the società di investimento, fondo comune and foreign LP for every fund in formation or contemplated restructuring.
2. Engage tax counsel on Budget Law impacts. Quantify the effect of amended participation‑exemption thresholds under Article 87 TUIR on projected exits and distribution waterfalls.
3. Reassess fund‑finance documentation. Lenders and arrangers should update template facility agreements, security documents and covenant packages for each vehicle type.
4. Monitor secondary legislation. CONSOB and Banca d’Italia implementing measures for the società di investimento are expected in the second half of 2026; subscribe to regulator alerts and adjust compliance calendars.
5. Review existing fund documentation. Managers of existing fondi comuni should assess whether conversion to a società structure is feasible and beneficial, and whether current LPAs permit the necessary amendments.
6. Obtain specialist legal advice. The interaction between three simultaneous legislative workstreams, TUF reform, Budget Law and AIFMD II, demands coordinated counsel across corporate, tax and regulatory disciplines. Find a private equity lawyer through Global Law Experts to ensure your fund structure is optimised for the new regime.

Last reviewed: 9 May 2026. This article reflects legislation and regulatory guidance publicly available as of that date. Readers should verify the status of pending secondary legislation, particularly CONSOB and Banca d’Italia implementing measures for the società di investimento vehicle, before making structuring or compliance decisions.

Sources

1. Banca d’Italia, Asset Management under the Revised Italian Consolidated Law on Finance
2. Global Legal Insights, Fund Finance Laws and Regulations 2026: Italy
3. The Italian Lawyer, Italian Capital Markets Reform 2026
4. WTS, Reform of the Italian Consolidated Law on Finance (TUF)
5. A&O Shearman, A New Era for Italy’s Investment Fund Toolbox
6. ICLG, Private Equity Laws and Regulations: Italy
7. Advant Nctm, AIFMD II Transposition and Credit Funds