1) Italian Tax Authority: Part I of Circular No. 5/E, containing clarifications on the institutes of the Code of Business Crisis and Insolvency, published

On 16 July 2026, the Italian Tax Authority published, at the conclusion of the public consultation, Part I of Circular No. 5/E, containing the first interpretative clarifications on certain institutes of the Code of Business Crisis and Insolvency (the “CCII”).

The circular, limited to the matters within the Agency’s competence, focuses on the treatment of tax and social security debts in the context of the negotiated composition of crisis (Title II, Chapter I), the simplified composition with creditors (Article 25-sexies), the restructuring plan subject to confirmation (Article 64-bis) and the framework governing groups of undertakings (Title VI).

Among the principal clarifications are: the possibility of reducing VAT in the settlement agreement of the negotiated composition of crisis (Article 23, paragraph 2-bis); the identification of the debts that may be included in the tax settlement; the time limit for the conclusion of negotiations; the procedures for submitting the proposal for partial and/or deferred payment of taxes, contributions and ancillary charges; the statutory interest rate applicable to tax debts; the time limit for the Tribunal’s vote; and the scope of application of the deferral of payments.

Part I opens with a reconstruction of the evolution of the framework governing business crisis, from the Bankruptcy Law to the current CCII. The circular is divided into four parts: the first dedicated to the new institutes of the Code; the second to over-indebtedness; the third to restructuring agreements and composition with creditors; the fourth to judicial liquidation and residual institutes. The remaining parts will be published at the conclusion of the ongoing and future consultations.

2)  Italian Supreme Court: in indirect continuity-based composition with creditors, an offer to purchase the business is relevant for the purposes of determining the liquidation value

By Order No. 22960/2026, published on 9 July 2026, the Italian Supreme Court ruled on the determination of the liquidation value of the business complex in indirect continuity-based composition with creditors, in the case where a third party has offered to purchase the business for an amount higher than the atomistic valuation of the individual assets.

The Supreme Court, having stated that the assessment of admissibility of the proposal requires a review of substantive legality of a scope equal to that provided for at the confirmation stage, specified that such review also extends to the manner of determining the liquidation value pursuant to Article 87, paragraph 1, letter c), of the CCII, as an element that fulfils an essential informational function for the informed exercise of creditors’ voting rights and constitutes, at the same time, a criterion of lawfulness of the proposal where their satisfaction follows the relative priority rule mechanism.

It follows that, in indirect continuity-based composition with creditors, it is unlawful to exclude from the liquidation value the amount of the third party’s higher offer and to adopt as a benchmark a lower valuation based on the atomistic disaggregation of the individual business assets, since the existence of that higher offer renders the lower valuation unsuitable to represent the actual value of the business complex.

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