Can the Italian Referendum Boost the Italian Economic Recovery?

On Sunday 4 December 2016 a constitutional referendum will be held in Italy. Voters will be asked whether they approve of amending the Italian Constitution to reform the appointment and powers of the Parliament of Italy, and the partition of powers of State, Regions, and administrative entities.

Should the amendments be approved by Italian voters (as hoped by Prime Minister Matteo Renzi), firms of all sizes could witness a dramatic change in the Italian economic scenario.

Confindustria reports that a more robust government, easier conditions for investors and in general, brighter economic prospects can be expected should there be a positive outcome to the referendum,. The future of the Senate (and the consequent passing of future laws from the lower chambers) is at stake together with the possibility of bringing the power of regional governments back to the centre.

Moreover, as reported by Francesco Starace, the chief executive of Enel (the main electricity company in Italy), the referendum could bring even more advantages for companies, in that politicians could be encouraged to take further action and implement further reforms in order to deregulate the economy, thus boosting its capacity for competition. It is hoped, however, that the momentum that has led the government to enforce regulations that made it easier and cheaper for start-ups to register continues in the foreseeable future. Such regulations have been awaited for more than 25 years and could result in a far brighter economic future for the country.

Bringing more powers to central government would also reduce costly complexity for firms. Lawmakers would be able to pass laws to cut bureaucracy (thus speeding up the process of reform implementation) and improve administrative procedures.

Finally, should politicians profit from the enhanced possibility of implementing reforms, it would be possible to address tax rules and regulations for investors in companies.

If you wish to know more about how a positive result in the upcoming Italian constitutional referendum could affect business and investment opportunities in Italy, do not hesitate to contact us at clientservices@giambronelaw.com or call us at 0207 183 9482.