New Italian arbitration rules included in civil justice reforms

By Legislative Decree No 149/2022, the Italian Government has implemented a structural reform of the Italian civil justice system. The new provisions include significant changes to Italian arbitration law relating, among others, to the independence and impartiality of arbitrators, new powers for arbitrators to grant provisional relief, and the enforcement of foreign awards. These amendments are now set to apply to arbitration proceedings in Italy instituted after 28 February 2023.

Provisional relief

As anticipated in our earlier post, the most important novelty is likely to be the new power of arbitral tribunals seated in Italy to issue interim measures.

This power requires the parties’ express written consent, to be provided prior to the commencement of the proceedings; for example in their arbitration agreement ( the consent may be provided by reference to relevant provisions in the rules of an arbitration institution designated by the parties).

The new legislation leaves no room for the co-existence of arbitrators’ and national courts’ authority to grant provisional relief: the arbitral tribunal will have exclusive authority after its constitution, whilst, beforehand, such interim measures can be granted by the Italian courts only. 

The competent Italian courts will also carry out a supervisory role as:

• the court of appeal of the seat will have jurisdiction over challenges (reclami) against the arbitral tribunal’s decision to grant or deny provisional measures (to be filed within 15 days), which will be allowed only on limited grounds (substantially mirroring the grounds for setting aside awards under Italian law), and with no possibility to challenge the merits of the tribunal’s determination. Pending such challenge proceedings, in case of serious prejudice deriving from supervening reasons the court of appeal, upon a party’s application, may stay the enforcement of the arbitrator-ordered interim measure, or subject such enforcement to the provision of appropriate security;
• the enforcement of measures granted by an arbitral tribunal will be carried out under the supervision of the court (tribunale) of the seat or, depending on the relief granted and/or when the arbitration seat is not in Italy, the court competent for the specific territory in Italy in which the measure has to be enforced.

In both cases, the Italian courts will follow the same rules applicable to the challenge and enforcement of court-ordered provisional measures.

Arbitrators’ appointment, independence and impartiality

With a view to aligning Italian arbitration law with the practice of the main international arbitration institutions, the amendments impose on each arbitrator a duty to disclose, at the time of acceptance of their appointment, the existence or absence of any circumstances that could lead to their challenge pursuant to the relevant Italian law provision (Article 815, para. 1, of the Italian Code of Civil Procedure (“ICCP”)). Failure to submit the statement nullifies the arbitrator’s acceptance. Moreover, the grounds for challenge under Article 815 have been expanded by adding a general provision that allows a party to challenge an arbitrator if there are serious grounds relating to an arbitrator’s independence or impartiality which would impact on the appropriateness of them holding office in the proceedings (“gravi ragioni di convenienza, tali da incidere sull’indipendenza o sull’imparzialità dell’arbitro”). In the lawmaker’s intention, this ground should establish an arbitrator’s duty to disclose all factual circumstances (e.g., the existence of a particular connection / relationship with one of the parties or one of the parties’ counsels) that may undermine an arbitrator’s independence or impartiality, even if only in the perception of the parties (“anche soltanto nella percezione delle parti stesse”).

In addition, in case of a change in circumstances, arbitrators must renew their disclosure statement.

If an arbitrator fails to submit the statement or to disclose any circumstance constituting a ground for challenge, any of the parties will be entitled to request the court to disqualify the relevant arbitrator within 10 days of their acceptance or of the party’s discovery of the undisclosed circumstance (as the case may be).

The new rules also stipulate that, when Italian courts are required to appoint arbitrators, they will have to follow criteria that will ensure compliance with the transparency, turnover and efficiency principles. To that end, the names of the so appointed arbitrators will have to be published on the appointing court’s website.

Immediate enforceability of foreign awards

The reform has also clarified that foreign awards will be immediately enforceable in Italy upon issuance of an ex parte recognition decree by the president of the competent court of appeal.

As a result, an award-creditor will be entitled to commence enforcement proceedings irrespective of a pending challenge to the award’s recognition. However, if a challenge is lodged, the court of appeal may stay enforcement, or suspend the enforceability effect of the award, in the event of serious reasons.

Other amendments

The new legislation also provides for:

• a shortening (from 1 year to 6 months after signing by the last arbitrator) of the time-limit to challenge an award;
• a more efficient regime to transfer cases from judicial to arbitral proceedings and vice versa, which, among others, will allow preservation of the (substantive and procedural) effect of the original claim, as well as to consider evidence gathered in the original proceedings as supplementary evidence (argomenti di prova) in the new one;
• a clear possibility for the parties to agree, prior to commencement of the arbitration proceedings, on the application of a foreign law or other rules (including lex mercatoria or UNCITRAL model laws) to the merits of the case. Absent such a choice, the arbitral tribunal will make a determination according to the conflict-of-law rules it deems applicable;

• the migration of the rules on corporate arbitration (arbitrato societario) to the ICCP, with the clarification that arbitral (interim) measures suspending the effects of companies’ shareholders meetings resolutions can be subject to challenge under the same conditions provided for by the above-described new general rules.