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Authors: Lucio D’Amario, Giorgio Valoti, Emma Lobaccaro
In January 2026, Italy’s FDI screening mechanism — the Golden Power regulation — was once again amended (see Law No. 4 of 15 January 2026).
In a nutshell, the reform:
The reform was driven by the infringement proceedings opened by the European Commission following the UniCredit/Banco BPM affair, i.e. the domestic banking takeover derailed following the sweeping conditions imposed by the Italian Government in April 2025 under the Golden Power regulation.
Based on available information, the EC’s concerns essentially revolve around the fact that such conditions conflict with the exclusive competences of the EC under the EU merger control regulation and the European Central Bank on prudential matters. Ultimately, when looking at the possible implications for transactions in the financial, credit and insurance sectors, the EC has raised doubts over whether the Golden Power regulation is compatible with EU law, including EU treaty freedoms.
The new rules aim to address the EC’s concerns by establishing procedural safeguards: the EC and the ECB must conclude their own assessments before Italy can act. However, the reform does not eliminate Italy’s power to intervene later, if it believes that its national essential interests are not adequately protected by sectoral regulation and the assessment already made by those authorities.
These changes are significant but also leave important questions unanswered. We focus on a few of them below:
For transactions in the financial, credit and insurance sectors the new provisions require the Italian Government to wait for the decisions of the “European authorities” responsible for prudential and merger control assessments before blocking the transaction or imposing conditions. Which authorities does the law refer to? Are decisions by the national authorities of EU Member States also relevant?
It seems that the provisions meant to refer only to “EU authorities”. This emerges from the preparatory works, which explicitly mention the EC and the ECB when commenting on the new provisions. In addition, if pending proceedings before national authorities were also included, especially those of other Member States, the timings of FDI proceedings in Italy would be overly uncertain and would significantly constrain action by the Italian Government.
Does the reform mean that getting an FDI clearance for transactions in the financial, credit and insurance sectors in Italy will now take longer?
Not necessarily. Lengthy timelines will arise in a subset of cases. The transaction must (i) concern the financial, credit or insurance sectors, (ii) be subject to clearance by the EC under merger control rules and/or prudential assessment by the ECB, and (iii) the Italian Government must intend to exercise its special powers. The Government remains free to clear the deal without waiting if it intends to clear it unconditionally or considers that the transaction falls outside the scope of the Golden Power regulation (as frequently happens).
In turn, in those cases where the Government will need to await the decisions of the EC and the ECB, obtaining a Golden Power clearance could take significantly longer. This is of course something to be taken into account, especially considering the broad spectrum of transactions that could be scrutinised by the ECB under prudential rules.
For transactions in the financial, credit and insurance sectors, should the parties wait until the EC (for merger control purposes) and/or the ECB (under prudential rules) have completed their assessments before notifying the deal to the Italian Government under the Golden Power regulation?
Again, not necessarily. While the legal deadlines to file set out by the Golden Power regulation are suspended pending the abovementioned proceedings, the parties are free to notify beforehand, especially if they believe the transaction will be unconditionally cleared - and even more so if asking for confirmation by the Italian Government that the transaction does not fall within the scope of the Golden Power regulation. In such cases, however, if the Italian Government were to consider that there might be a need to exercise its special powers, it could reject the filing and require a new notification once the proceedings before the EC and the ECB have concluded. Interestingly, the reform does not grant the Italian Government the power to suspend an already initiated procedure pending those decisions, presumably due to a mere oversight.
Will the reform prevent a new UniCredit/Banco BPM case? Is it reasonable to expect the EC to close its infringement procedure?
The reform ensures better coordination between the Italian Government and the EC/ECB for transactions in the financial, credit and insurance sectors. Under the revised Golden Power regulation, the Italian Government’s review of the UniCredit/Banco BPM case would have (i) followed a different process; and (ii) had a different timing — although it is unclear whether it would have had a different outcome.
More generally, the reform could help avoid conflicting decisions whereby the Italian Government imposes remedies or vetoes a deal to address issues that fall within the competences of the EC or the ECB (e.g., for the ECB, in the area of economic and financial security). That said, even following the reform, the Italian Government can still intervene if it believes that Italy’s national interests are not adequately protected by sectoral regulation and the assessment already made by the EC and/or ECB.
It is unclear whether the reform will successfully address the EC’s concerns, but press reports suggest that the EC is broadly well-disposed. However, from a purely legal standpoint, the EC retains room to conclude that the reform is insufficient. In addition, the reform now differentiates, also at a procedural level, between transactions in the financial, credit and insurance sectors and those in other sectors, and this delineation is not always clearly justified.
Only time will tell how the Italian Government will apply these new rules in practice. What is already clear, however, is that this reform — another emergency decree-driven amendment grafted onto an already complex statute — further reinforces the need for an urgent and comprehensive overhaul of Italy's Golden Power legislation. The upcoming implementation of the EU Screening Regulation provides a timely opportunity to undertake such reform — one that should not be missed.
27 February 2026