The Italian legislation in support of innovative startups. Executive summary
The general objective of the policy measures outlined in this document, submitted by the Italian Ministry of Economic Development, is to promote sustainable growth, technological advancement and, in particular, to create favourable conditions for the development of a new business culture inclined towards innovation.
Other explicit goals of this policy are enhancing social mobility,generating new employment, especially for the youth, reinforcing the links between universities and businesses, and increasing the capacity of Italy to attract foreign capitals and talents.
The legislation in support of innovative startups does not apply to all newly-established enterprises, but only to those that present a clear character of technological innovation. Besides this distinction, no industry-specific restriction has been made: the legislation is potentially applicable to companies operating in any economic sector, from digital to manufacturing, from trade to agriculture.
Definition of innovative startup
Any companies with shared capital (i.e. limited companies, “società di capitali”), including cooperatives, whose capital shares – or equivalent – are neither listed on a regulated market nor on a multilateral negotiation system. These enterprises must also comply with the following requirements:
• be newly incorporated or have been operational for less than 5 years (in any case, not before 18 December 2012);
• have their headquarters in Italy or in another EU country, but with at least a production site branch in Italy;
• have a yearly turnover lower than € 5 million;
• do not distribute profits;
• have as exclusive or prevalent company object – as stated in the deeds of incorporation – the production, development and commercialisation of innovative goods or services of high technological value;
• are not the result of a merger, split-up or selling-off of a company or branch;
• the innovative character of the enterprises is identified by at least one of the following criteria:
1. at least 15% of the company’s expenses can be attributed to R&D activities;
2. at least 1/3 of the total workforce are PhD students, the holders of a PhD or researchers; or, alternatively, 2/3 of the total workforce must hold a Master’s degree;
3. the enterprise is the holder, depositary or licensee of a registered patent (industrial property), or the owner and author of a registered software.
Definition of “innovative startup with a social goal”
This typology of enterprise fulfills all the requirements that apply to ordinary startups and, in addition, operates in specific domains that, according to Italian legislation, are of a considerable social value. Circular 3677/C, issued by the Ministry of Economic Development on 20 January 2015, introduced a new procedure for the recognition of innovative startups with a social goal, extremely agile, based on an assessment of the social impact generated. To help innovative entrepreneurs follow the procedure correctly, the Ministry has published a “Guide to drafting the Social Impact Report” (in Italian), redacted in cooperation with the Ministry for Education, University and Research (MIUR), as well as other players of the social entrepreneurship community.
Source: Ministry of Economic Development