In Italy, disputes are mainly resolved through litigation, although the parties may resort also to arbitration and alternative dispute resolution methods (ADR, namely mediation, and negotiation with the assistance of lawyers, i.e. the Italian “negoziazione assistita da avvocati”). Regarding ADR methods, it must be considered that they represent not only voluntary non-adversarial approaches but, in some cases, can also constitute prerequisites for filing lawsuits related to specific matters.

Commercial litigation is governed by the Italian Civil Procedure Code (i.e. Codice di Procedura Civile, CPC) that covers all the stages and phases of litigation, including – among others – enforcement proceedings and special proceedings such as arbitration and class actions. The CPC also contains general provisions and principles, such as the role of judges and their powers, the activities of the clerks, parties and counsel and their respective duties.

Italian proceedings may involve 3 stages: i) first instance proceedings before the Justice of the Peace or the Tribunal, ii) appeal before the Tribunal or Court of Appeals, and iii) third instance proceedings before the Supreme Court (“Corte Suprema di Cassazione”).

The Justice of the Peace rules over minor cases such as, by way of example:

• disputes relating to movable goods having a value not exceeding € 10,000.00;
• damage caused by vehicles and boats, provided that the value of the dispute does not exceed € 25,000.00.

The judgments delivered by the Justice of the Peace can be appealed before the Tribunal.

The vast majority of cases are adjudicated by the Tribunals. Judgments delivered by the Tribunals can be appealed to the Court of Appeals.

There are 165 Tribunals in Italy, and 26 Courts of Appeals.

The third instance is always a prerogative of the Supreme Court (Corte di Cassazione), sitting in Rome. This Court, under Article 360 CPC, rules over cases of:

• infringement of the rules on jurisdiction;
• infringement or misapplication of rules of law, and of national collective labour contracts and agreements;
• nullity of a judgment or of the proceedings;
• failure to examine a decisive fact which was the subject of discussion between the parties.

Under the new rules of civil procedure enacted in 2023 (Legislative Decree no. 149/2022), court proceedings are divided into four phases:

1. Introductory phase: each party files its submission (either a summons, for the petitioner, or the statement of defence, for the opposing party) and the judge, upon examination of the parties’ briefs, rules on preliminary issues, confirming the date of the hearing indicated in the summons or postponing it;
2. Pre-trial: each party may file up to three submissions, followed by a hearing to discuss and possibly admit the parties’ requests for evidence;
3. Evidence-taking: if pre-trial motions have been admitted, the judge will schedule the hearings deemed necessary for the taking of witness evidence (the number of hearings may vary depending on the motions admitted);
4. Final phase: once the evidence-taking phase is concluded, the parties are typically requested to file two further submissions (this may vary in the event that the final phase takes place only in oral form or in mixed form, in which case only one submission will be filed).

On the basis of this time frame, the first hearing normally takes place within 8 to 10 months after the serving of the summons to the opposing party, while the pre-trial phase takes place within 12 to 16 months.

Only the hearings called for oral arguments are public unless the judge orders they are held in closed session. As to other hearings, which are a majority, only the lawyers and the parties can attend. Under the new rules enacted in March 2023, the parties must attend the first hearing: the new rule was introduced to allow the judge to directly approach the parties in order to try a settlement of the case. In any case, if the parties are unable to attend the hearing, they are free to be represented by a general or special attorney who must be familiar with the facts of the case. In these cases, the power of attorney must be conferred by public deed or notarised private deed and must confer on the attorney the power to settle the dispute. The general or special attorney may also be the same lawyer representing the parties in court.

The documents filed in court by the parties are never available to the public.

In case of breach of contract, the claimant must bring the action within 10 years from the date of discovery of the breach. Shorter limitation periods apply to some particular contracts (e.g., insurance or employment agreements).

An action for damages arising from non-contractual liability, such as fraudulent or negligent conduct, must be brought within 5 years from when the harm occurred or became known. However, if the conduct constitutes a criminal offence for which a longer limitation period is applicable, that longer period shall apply.

These are general rules and several exceptions exist.

Depending on the subject matter of the dispute, the initiation of some alternative dispute resolution procedures, namely mediation or “assisted negotiation” may be a prerequisite to commence a legal action.

The disputes subject to mediation as a condition of admissibility are those concerning condominiums, lease agreements, loan agreements, business lease agreements, rights in rem, inheritance, family agreements, insurance, banking and financial agreements, medical malpractice and libel, joint venture, consortium contracts, franchising, contracts for the provision of professional services, supply of goods.

On the other hand, the “assisted negotiation”, which is a negotiation conducted by the parties with the mandatory assistance of lawyers, in compliance with certain formalities, is mandatory for disputes concerning compensation for damage caused by traffic accidents and payment of sums of any kind not exceeding € 50,000.00.

Whenever the initiation of the ADR procedure is mandatory and is not carried out, the court before which an action is brought will order the plaintiff to remedy and, if the plaintiff does not comply, may stay the case or declare the action inadmissible.

Depending on the proceedings to be commenced, in the Italian legal system a lawsuit can be initiated in two ways: by serving a summons (“citazione”) or by filing a petition (“ricorso”) in court. The choice between the two depends on the subject matter of the dispute and the type of procedure (eg, interim and summary proceedings are commenced with a ricorso). In both cases, the service of the introductory deed is always necessary and in most cases is made by the plaintiff’s counsel. In case of petitions, the plaintiff must wait for the judge to set the hearing and serve to the defendant the claim filed with the order setting the hearing.

First of all, Italian Courts have jurisdiction over any individual or company residing in Italy.

In addition, Italian Courts have jurisdiction over EU defendants under several European Regulations, the most important of which is Regulation 1215/2012 on civil and commercial matters.

Moreover, Law 218 of 1995, the Private International Law Act, provides some rules on jurisdiction of general scope (Articles 3-11) and others applicable to particular matters (Articles 22, 32, 37, 40, 42, 44, 50). Law 218 provides that Italian Courts have jurisdiction based on the criteria set forth in the Brussels Convention of 1968, even when the defendant is not based in a signatory state. The Supreme Court, United Divisions, has been recently called to establish if the reference to the Brussels Convention must be considered replaced by a reference to EU Regulations.

Other rules on jurisdiction are set out in international conventions, the main one being the Lugano Convention II (governing jurisdiction between Italy and Switzerland).

Italian courts may rule on the applicable jurisdiction at the outcome of the case – when the judge decides on the merits – or at an early stage of the proceeding.

Private International Law n. 218 of 1995 sets out criteria for choosing the applicable law in the case of cross-border disputes.

However, the growing trend towards the general application of European private international law Regulations leads to a consequent erosion of the provisions of Law 218/1995, which remains applicable on a residual basis, only to cases that do not fall within the scope of the Regulations.

The Italian legal system provides several instruments that allow an early disposal of the dispute.

First of all, in cases where a party asserts a credit claim consisting of the payment of a sum of money, the delivery of a certain quantity of fungible things other than money or the delivery of movable goods, it is possible to file in court an application for an injunction (decreto ingiuntivo).

This type of order is issued inaudita altera parte, i.e. without first suing the debtor.

The Italian Code of Civil Procedure states that a decreto ingiuntivo can be obtained if the claimant provides written proof of his claim, or if the claim concerns fees for performances of lawyers, chancellors, bailiffs, notaries or other categories of persons exercising a freelance profession.

Once an order for payment has been obtained, it must be served on the debtor by the creditor. From the date of service, a time limit starts to run within which the debtor can file in court an opposition to the order (usually 40 days, unless the debtor is based outside Italy).

Only if opposition is filed within the time-limit indicated by the court, a full trial starts. Otherwise, the order becomes final.

A number of measures similar to summary judgments have been introduced in the Italian procedural system by a 2023 reform.

According to Article 183 ter of the Code of Civil Procedure, upon request of a party, during a full trial, the judge may pronounce an order accepting the judicial claim, when the facts constituting the claim are proven and the other party’s defences appear manifestly groundless. The order of acceptance is provisionally enforceable, can be appealed against within 15 days of its issue and does not acquire the force of res judicata, nor can its authority be invoked in other proceedings. In the same order, the court settles the costs of the litigation. The order, if it is not appealed or if the appeal is rejected, shall be final and may not be further appealed.

On the contrary, according to Article 183 quarter of the Code of Civil Procedure, upon request of a party, during the proceedings, the judge may pronounce an order rejecting the claim if it is manifestly groundless, or if the subject matter of the claim is omitted or absolutely uncertain and the nullity has not been remedied, or if, after an order to renew the summons or supplement the claim, the lack of a statement of facts persists. The order of rejection of the claim can be appealed against within 15 days of its issue and does not acquire the force of res judicata, nor can its authority be invoked in other proceedings. In the same order, the court settles the costs of the litigation. The order, if it is not appealed or if the appeal is rejected, shall be final and may not be further appealed.

In the Italian legal system, interim measures can be divided into three categories: preventive measures, possessory measures and provisional measures.

The aim of the preventive measures is to neutralize the risk of suffering harm as a consequence of the duration of a full trial. Preventive measures are temporary and remain in force until the issuance of the final judgment which replaces them. The preventive measures provided for by Italian law are the following:

• preventive seizure: when a creditor has a well-founded fear of losing the guarantee of his claim or loan while the full trial is pending, if certain requirements are met, he may ask the court to authorise the seizure of the debtor’s movable or immovable property or of the sums and assets due to them;
• judicial seizure: it may be ordered by the judge in relation to movable or immovable property when their ownership or lawful possession is disputed. It is a necessary measure to entrust the temporary custody and management of such assets;
• prevention of new work: if new works are started on a property, a person who has reason to fear that his property, his limited rights in rem or his rights of possession will be affected by such works may request the court to issue an order preventing the works from continuing. Such a request may be made on condition that the work has not been completed;
• prevention of feared damage: if a person has reason to fear that his or her property, rights in rem or rights of possession are seriously endangered by a construction or other element, he or she may apply to the court, depending on the circumstances, for an order to eliminate the risk of damage;
• urgent measures: these are residual measures that play a complementary role to the ‘typical’ measures already described. A person who has a well-founded fear that, during the time it takes to assert his rights in ordinary proceedings, his or her claim or right will be threatened by imminent and irreparable harm, may apply to the court for the provisional measure that is most appropriate to provisionally ensure the enforcement of the final judgment;
• preventive taking of evidence: in contrast to the measures just listed, the aim is to secure evidence in advance to avoid the impossibility or difficulty of proving facts in subsequent proceedings, due to the destruction or loss of evidence in the meantime.

The possessory proceedings provided by Italian law are two:

• action for recovery of possession: gives the person who has been forcibly or secretly deprived of its possession the right to sue the responsible party to recover possession;
• action to protect possession: if a person deems his or her possession of immovable property, of a right in rem over immovable property or of a totality of movable property to be disturbed, he or she has the right to bring an action to protect his or her possession.

In ordinary proceedings, once the writ of summons has been served, the defendant must file its statement of defence no later than 70 days before the hearing indicated in the summons. A period of not less than 120 days must elapse between the day of service of the summons and the day of the hearing. Once the time limit for the defendant to appear has expired, within 15 days the judge is called upon to carry out some preliminary checks on the regularity of the proceedings. Thereafter, the parties are given three deadlines:

• within 40 days before the hearing, the parties may specify or amend their claims, or propose claims or objections that are a consequence of the opposing claims;
• within 20 days before the hearing, the parties may reply to the opposing party’s objections and indicate their means of proof;
• within 10 days before the hearing, the parties may indicate evidence to the contrary.

In the cases where the judgment must be introduced in the form of a simplified procedure (according to Article 281 decies Code of Civil Procedure), the claimant must file a petition  before the court. The judge sets the hearing for the parties to appear, setting the time limit for the defendant to file a statement of defense, which must take place no later than 10 days before the hearing. After the hearing, only if requested by the parties and if there are justified reasons, the judge may give the parties a time limit of no more than 20 days to specify and amend the claims, objections and conclusions, to indicate the means of proof and to produce documents, and a further time limit of no more than 10 days to reply and to present contrary evidence.

In Italy, there are no disclosure or discovery obligations as intended in common law systems. In any case, in a civil trial, every party can request the court to order another party or a third party to:

• disclose documents that are in their custody. This production mechanism is governed by Articles 210 to 212 of the Code of Civil Procedure. The party applying for an order must show that the document is necessary for the case. In ordering the disclosure of the document, the court must give appropriate orders as to the time, place, and manner of disclosure. If the party fails to comply without a reasonable cause, the court orders the payment of a fine and may also consider the argument as proven;
• allow on their person or property inspections that are essential to knowing the facts of the case, under Article 118 of the Code of Civil Procedure. If the party fails to comply without a reasonable cause, the court orders the payment of a fine and may also consider the argument as proven.

Also, under Article 213 of the Code of Civil Procedure, the court, ex officio, can request from public authorities written information on acts and documents necessary for the trial. Within 60 days, the public authority must provide the requested information or give reasons for its refusal.

In any case, there are some rules that permit parties to refuse to disclose certain types of documents and that prevents them from using them as evidence.

First of all, as recently confirmed by the European Court of Human Rights in Saber v. Norway case (17^th December 2020), communications between lawyers and their clients are confidential; therefore, even the judge cannot compel the lawyer or client to produce them. However, the client is always free to disclose information without any prior approval from the client’s lawyer.

In some cases, even correspondence between lawyers cannot be reported or produced in court. According to Article 28 of the Code of Ethics of Lawyers (Codice Deontologico Forense), confidential letters and correspondence containing settlement proposals exchanged with lawyers shall not be filed, shown, or referred to in court.

The witnesses are usually required to give oral evidence and are examined on specific circumstances. These circumstances must be explained in writing by the party that wants to use the evidence and must relate to clearly stated facts.

There is no cross-examination in Italian proceedings. Witnesses are questioned directly by the judge and lawyers cannot pose direct questions to them, but can request the judge to ask the witnesses for clarifications.

If there are conflicts between the statements of two or more witnesses, the court can order that they be compared (Article 254, Code of Civil Procedure).

Under Article 257-bis of the Code of Civil Procedure, the judge, with the agreement of the parties, can order the taking of testimonial evidence by requesting the witness to provide, in writing and within a set deadline, answers to the questions on which the witness is to be examined. The judge, after examining the witness statement, can still order that the witness be called to appear before the judge.

The judge can appoint an expert to clarify facts or technical issues whenever the judge deems it appropriate. Each court has a list of accredited experts from which the judge can choose.

The role of the court-appointed expert is to assist the judge in resolving technical issues that are introduced into the trial when the claims brought by the parties do not consist exclusively of legal issues. More specifically, the court can appoint an expert to assess established facts or pre-existing data (in which case the expert’s work is not considered evidence per se) or to verify facts not otherwise ascertainable except through the use of special techniques or knowledge (in which case the expert opinion becomes a direct source of evidence and can be used in the same way as any other evidence submitted in the proceedings).

The parties are allowed to designate their own experts after the judge has appointed the court’s expert. The role of an expert hired by a party is to assist the court-appointed expert by either endorsing or challenging their observations.

Courts assess the probative value of the expert’s opinion.

Although the law does not provide that the opinion expressed by the court-appointed expert is more important than the opinions expressed by experts hired by the parties, in practice it is hard to convince the court to disagree with the conclusions of the court-appointed expert.

As said above, final decisions of the Tribunals can be appealed to the Courts of Appeals. If the final decision of the court is not served to the unsuccessful party, the appeal must be lodged within 6 months from the day the decision was issued. Shorter appeal periods apply if the final decision is served to the unsuccessful party (30 from the date of the service).

A court of appeal’s final decision can be challenged before the Supreme Court of Cassation, but only on grounds of law (in principle, the Court of Cassation does not review the decision on its factual grounds). Appeal in cassation must also be filed within 6 months from the day the decision was issued. Shorter appeal periods apply if the final decision of the court of appeal is served to the unsuccessful party (60 days from the date of the service).

With regard to the interim orders referred to in paragraph 12 above, it should be noted that:

• the order by which the judge issues or denies preventive measures may be challenged by the unsuccessful party within 15 days of its issuance. The appeal proceedings take place before a panel of judges belonging to the same court that issued the order (in any case, the panel of judges may not include the same judge that issued or denied the measure);
• also the orders issued at the end of the possessory proceedings may be challenged within 15 days of their issuance, before the same court of the first instance judgment;
• finally, the orders which grants of denies provisional measures cannot be appealed autonomously.

Being a member of European Union, Italy is subject to European regulations, and in particular to the Regulation (EU) no. 1215/2012 (Brussels Regulation). The Brussels Regulation states, as a general rule, that a judgment given in a member State shall be recognised in the other member States without any special procedures being required.

Italy is also subject to the Lugano Convention dated 30 October 2007, entered into between the European Union and Denmark, Iceland, Norway and Switzerland, which provides for the recognition of the judgments issued in an adhering State without any specific procedure being necessary. However, in order to be enforced, the judgment has to be declared enforceable in the State where it shall be enforced on the application of any interested party.

Furthermore, the Hague Choice of Courts Convention concluded on 30 June 2005 also provides that the recognition of the judgments given by the court of a contracting State designated in an exclusive choice of court clause may be refused only on the grounds specified by the said Convention.

Last but not least, on 29 August 2022 the European Union (with the exception of Denmark) ratified the Hague Convention concluded on 2 July 2019 on the recognition and enforcement of foreign judgments in civil or commercial matters, which came into effect on 1 September 2023. Besides the European Union, to date the Hague Convention 2019 has been ratified only by Ukraine and Uruguay, while Costa Rica, Israel, Montenegro, North Macedonia, the Russian Federation, the United States of America and the United Kingdom (this one in January 2024) has only signed the convention, but not ratified the text yet.

In the absence of an applicable convention, the Italian law 31 May 1995 no. 218 regulates the field of private international law and states that a judgment issued by a foreign court may be recognised and enforced within Italian territory, provided that the main criteria indicated by article 64 are met.

As a general rule, the losing party bears its own costs as well as those of the prevailing party, to whom it will pay court costs and the costs connected to instructing lawyers and other professionals. Lawyers’ fees are settled according to parameters set by the Ministry of Justice, whereas the fees of other professionals are settled by the judge with a discretionary evaluation based on the assessment of the evidence of expenditures presented. In the event that both parties have been unsuccessful on some of the claims made, or because of the particular complexity of the case, the judge may order that each party bear their own costs.

In Italy class actions are governed by the CPC and the Consumer Code.

The CPC (Articles 840-bis to 840-sexiesdecies), provides for the protection of the homogeneous individual rights of a class by collective actions that can be initiated both by each member of the class, which retains its locus standi, or by non-profit organisations or associations registered in specific lists with the Ministry of Justice. The action may be brought against companies or entities providing public services to obtain a declaratory judgment as to their respective responsibilities and an order to pay damages.

On the other hand, the Consumer Code has recently been amended to implement EU directive No. 2020/1828. These provisions aim to specifically protect the rights of the consumers by also giving them the possibility of bringing representative actions not only nationally but also across borders. Moreover, differently from the protection offered by the CPC, the new rules on consumers’ class actions allow a representative action to be brought not only against companies and entities providing public services, but also against any natural or legal person, public or private for purposes relating to their commercial, entrepreneurial or professional activity. The consumer class action is aimed at obtaining injunctive and compensatory relief.

Third parties may intervene in ongoing proceedings in different ways: i) on a voluntary basis: the third party may join an action to assert a claim or to support other parties’ ones, only if the third itself has an interest in the proceedings; ii) upon request of a party: the third party may be summoned by one of the other parties if they have interest in a joint decision or want to be held harmless and indemnified by the third party; iii) by order of the judge.

As to the consolidation of proceedings, the court may order at its discretion or at the request of a party, to consolidate two sets of proceedings in one, if the disputes are the same or are linked by elements of connection, resulting in the need to rule over them jointly to avoid contrasting judgments.

In Italy third-party litigation funding is not precluded, but it is not subject to a specific regulation, with the effect of creating a regulatory gap that could discourage potential investors. However, in recent years, there has been a growing interest in litigation funding in Italy, to the extent that investors have also created national funds, providing expertise and litigation risk management tools to the interested parties.

As proof of the growing interest in the emerging litigation funding, the Supreme Court has recently issued some rulings on the matter. In particular, it affirmed a significant reasoning, i.e. that (generally) the companies providing for litigation funding do not need to comply with the rules laid down for banks and intermediaries operating assignment of credits (such as the enrolment in a specific register) because the funds disbursed do not have a typical financing cause.

As a further side note indicating a growing attention to the phenomenon of litigation funding in Italy, the Milan Chamber of Arbitration provides, in its recently amended rules, that the party receiving funding in connection with arbitration proceedings and its outcome must disclose the existence of the financing and the identity of the funder, in order to comply with the principles of impartiality and independence that characterise the relationship between parties and arbitrators.

On the other hand, the development of litigation funding has given rise also to some concerns, especially from a deontological point of view. In particular, it has been discussed whether certain principles might be potentially undermined, such as: the prohibition of acquiring clients through agencies or procurers, independence and autonomy (even if the engagement is conferred by a third party, the lawyer has to accept it only with the consent of the assisted party and to carry it put only in their interest), confidentiality (e.g. the litigation funder may request to be kept up-to-date on the progress of the dispute or to access and examine the file documents).

During the pandemic, the courts introduced the possibility of hearings being held in writing, i.e. by means of notes e-filed by the parties, or by video conferencing. These provisions, also with a view to the progressive digitalization of Italian proceedings, were affirmed with the reform of civil justice (Legislative Decree no. 149/2022) and incorporated into the CPC. In the same vein, among others, a procedure for the digitalization of the files of the Justice of the Peace and the Court of Cassation has been initiated.

Among the main advantages of litigating in Italy is the fact that the costs of justice are lower compared to other jurisdictions. In addition, Italy provides for the possibility of three levels of judgement for most of the decisions, so as to ensure a correct interpretation of the law and of the evidence. It should also be borne in mind that each district court of appeal in Italy has a specific commercial section where judges are highly specialized in business law and intellectual property.

Among the main disadvantages are: i) the duration of the cases, caused by the judges’ workload and courts’ schedule, ii) the structure of Italian proceedings (many hearings take place and the parties exchange several defensive briefs), iii) the fact that in Italy recourse to ADR is not very common, iv) the impossibility to conduct litigation in English.

The areas of expansion for commercial litigation go hand in hand with the development of today’s society. Consequently, it can be estimated that there will be more and more litigation on ESG issues (as climate change litigation) and new technologies. In addition, as far as Italy is concerned and therefore the specificities of the reference market, further areas of litigation could be real estate and procurement (given the significant increase of investments in Italy), as well as the food sector (given the relevance as well as the hyper-regulation of the market, both from a national and European point of view).

Digitalization of justice has already significantly facilitated the management of litigation in Italy, especially with regard to the implementation of systems for online filing of pleadings and applications, as well as the possibility of using electronic copies in the same way as paper originals. Similarly, the activities of judges and lawyers will be further facilitated in terms of consulting databases and accessing laws and case law, as well as by the use of artificial intelligence, machine learning and all kinds of legal tech tools.