Italy Approves New Controversial Capital-Markets Reform Bill

(Bloomberg) -- Italy’s lower house approved a capital-markets reform bill that includes a controversial change in the way listed companies’ boards are appointed.

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The bill, which includes measures that give long-term investors more votes per share, were approved by the Chamber of Deputies in Rome on Tuesday. The reform now goes to the Senate for final approval.

The new capital-markets bill seeks to attract more listings to Italy and to protect family companies from hostile takeovers. It also attempts to bring some companies that had moved their registered offices to the Netherlands back to Italy. Among companies that have done so are Stellantis NV and Ferrari NV.

The most controversial part of the bill, however, involves measures regarding the appointment of boards, which would no longer automatically allow the outgoing board of directors to present its own list. It’s been common practice for years in Italy, including at many banks and insurers like Assicurazioni Generali SpA, UniCredit SpA and Mediobanca SpA.

While the government has hailed the new rules as a good way to prevent boards from reappointing themselves indefinitely, opposition parties abstained from the vote on Tuesday.

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