Uninterrupted ownership (the “holding period”) – Shareholding acquired as a result of a contribution under the “controlled realisation” tax regime or by way of a demerger (“scissione mediante scorporo”) – Effects

With regard to a demerger by way of a “scissione mediante scorporo” pursuant to Article 2506.1 of the Italian Civil Code, involving the transfer to a pre-existing beneficiary company of assets other than a business or a business division, as well as shareholdings meeting the “objective” requirements for the participation exemption relating to residence and/or the carrying on of a commercial activity under Article 87(1)(c) and (d) of the Italian Income Tax Code (TUIR), the second sentence of Article 173(15-ter.1) TUIR provides for an extension of the relevant holding period.

This provision applies to any subsequent disposal by the demerged company of the shareholding in the pre-existing beneficiary company received in consideration for the demerger in its favour.

For disposals of such shareholdings by the demerged company, the legislation provides that the shareholdings received by the demerged company qualify for the participation exemption if and when the relevant requirements are met, provided that those shareholdings have been held continuously at least from the beginning of the third tax period preceding the subsequent disposal.