From: OVERSEAS BUSINESS REPORTS (ITALY)
Dep Lib Icon UM-St. Louis
University of Missouri-St. Louis


 

 
 Match 8   DB Rec# - 24,410  Dataset-MARKET
 
Source        : USDOC, International Trade Administration 
Source key    :IT 
Program key   :IT MARKET 
Program       :Market Research Reports 
Update sched. :Monthly 
ID number     :IT MARKET 111102229 
Title         :ITALY - OVERSEAS BUSINESS REPORT - OBR9301 
Data type     :TEXT 
End year      :1993
Date of record:02/16/1993
Keywords 1    : 
| 9301 
| CC475 
| ECONOMY 
| FINANCE 
| INVESTMENT 
| ITALY 
| MARKET|ASSESMENT 
| OBR 
| OBR9301 
| STATISTICS 
| ZEC 
 
Country       : 
 
 
| ITALY 
| EC 
| EEC 
| EUROPE 
| EUROPEAN COMMUNITY 
| EUROPEAN ECONOMIC COMMUNITY 
| OECD 
| ORGANIZATION FOR ECONOMIC COOPERATION & DEVELOPMENT 
| ORGANIZATION FOR ECONOMIC COOPERATION AND DEVELOPMET 
| WEST EUROPE 
| WESTERN EUROPE 
| WESTERN EUROPEAN COUNTRIES 
 
Text          : 
ITALY - OVERSEAS BUSINESS REPORT - OBR9301 
 
SUMMARY 
 
This article is derived from a report dated January 1993, prepared at the 
U.S. Department of Commerce - Washington, DC.  The article consists of 74 
pages and discusses the economic and commercial climate in Italy, with 
emphasis on information useful for potential U.S. sellers and investors.  It 
includes the following sections: 
 
OVERVIEW AND TRADE OUTLOOK 
BEST U.S. EXPORT PROSPECTS 
DISTRIBUTION AND SALES CHANNELS 
U.S. DEPARTMENT OF COMMERCE EXPORT SERVICES 
BANKING AND CREDIT 
TRADE REGULATIONS 
INVESTMENT 
OVERVIEW OF TAXES 
EMPLOYMENT 
GUIDANCE FOR BUSINESS TRAVELERS 
SOURCES OF INFORMATION 
EXPORT MARKETING PLAN OUTLINE 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                           MARKETING   IN   ITALY 
 
 
 
                                 prepared by 
 
 
                 Boyce Fitzpatrick, Office of Western Europe 
              and the U.S. & Foreign Commercial Service, Italy 
                                January, 1993 
 
                               C O N T E N T S 
 
OVERVIEW AND TRADE OUTLOOK 
General and Economic Background   Foreign Trade Outlook   European 
Community   EC Single Internal Market 
 
BEST U.S. EXPORT PROSPECTS 
Software   Pollution Control   Computers   Telecommunications   Aircraft and 
Parts   Energy Sector   Electronics and Components   Health Care   Sporting 
Goods   Electrical Production   Water Technology   Franchising   Cosmetics 
Industrial Process Controls   Packaging Machinery   Security Equipment 
Apparel 
 
DISTRIBUTION AND SALES CHANNELS 
Marketing Areas   Retail Distribution in Italy   A Changing Market 
Distribution Methods   Import Channels   Appointing an Agent or a 
Distributor   EC Legislation on Agents   Wholesale and Retail Channels 
Transportation   Advertising   Market Research and Trade Organizations 
Trade Fairs   Government Procurement 
 
U.S. DEPARTMENT OF COMMERCE EXPORT SERVICES 
Export Programs   Trade Information Center   National Trade Data Bank 
Pitfalls to Avoid When Exporting 
 
BANKING AND CREDIT 
Availability of Credit   Foreign Exchange Policy   Quotations and Terms of 
Payments   Installment Sales and Requirements   Obtaining Credit 
Information   Export Financing Programs 
 
TRADE REGULATIONS 
Membership in the EC   Import Duties   Quotations and Payment Terms 
Temporary Imports   Goods in Transit   Free Trade Zones   Inward and Outward 
Processing   Samples and Advertising Materials   Carnets   Advance Rulings 
from Italian Customs   Value-Added Tax   Excise Taxes   Shipping Documents 
Marking and Labeling   Import Licensing   Technical Standards   European 
Community Certification   Assistance on Standards   Electrical Current 
Weights and Measures   U.S. Export Controls   Intellectual Property Rights 
Protection   Laws Governing Intellectual Property Rights   European Patent 
Convention 
 
INVESTMENT 
Investment Climate   Investment Incentives   Entry and Repatriation of 
Capital   Requirements for Business Operation   Government's Role in 
Industry   U.S. Investment in Italy   Forms of Business Organizations 
 
OVERVIEW OF TAXES 
Corporate Taxation   Taxable Income   Tax Returns   Allowable Deductions 
Tax Convention with Italy 
 
EMPLOYMENT 
Industrial Relations   Dismissal of Workers   Employment of  Foreign 
Workers   Worker Advisory Councils 
 
GUIDANCE FOR BUSINESS TRAVELERS 
Business Courtesy   Commercial Language   Business Hours   Passports and 
Visas   Other Information   Currency   Holidays 
 
 
 
SOURCES OF INFORMATION 
U.S. Government   Other Organizations   Exhibition Associations   Exhibition 
Organizers   Italian Trade Associations   Italian Government and Agencies 
Tax and Accounting Firms   U.S. Publications and References   Other 
Publications and Information Sources 
 
EXPORT MARKETING PLAN OUTLINE 
 
 
OVERVIEW AND TRADE OUTLOOK 
 
 
General and Economic Background 
The Republic of Italy covers an area of some 301,230 square kilometers 
(116,300 square miles) or about the size of Georgia and Florida combined. 
Italy is a long boot shaped peninsula extending from the Alps into the 
Mediterranean Sea with two large islands of Sicily and Sardinia and numerous 
smaller islands offshore.  The Italian peninsula is 1,170 kilometers (725 
miles) long and from 218 kilometers wide in the north to 129 kilometers wide 
in the south (135 to 80 miles).  With the Alps in the north and the 
Apennines mountain range extending down the center of the peninsula, about 
75 percent of the country is mostly rugged and mountainous terrain except in 
the valleys and certain coastal areas. The Po River Valley in the north 
represents the largest and most fertile area for farming and has the most 
developed industrial region. 
 
In the north, winters are cold with precipitation distributed evenly during 
the year.  The Po River, the longest river in Italy, is fed throughout the 
year by the distant mountain snows.  The central and southern sections of 
the country have a Mediterranean climate with mild winters and hot and dry 
summers moderated with ocean breezes. 
 
In 1972, Italy enacted a broad decentralization plan that transferred 
considerable authority to 20 regional administrations.  These regions have 
taken over responsibility for local police, schools, welfare, agricultural 
programs, tourist promotion, and industrial development. 
 
Italian is the official language and is spoken throughout the country. In 
many remote areas, however, regional dialects continue to be used.  In 
addition, cultural and linguistic differences are recognized in  three 
border regions: French in Val d'Aosta, German in Trentino-Alto, and Slovac 
in Friuli-Venezia Giulia. 
 
San Marino is a small and independent republic in east-central Italy with an 
area of some 62 square kilometers (24 square miles) and a population of 
about 22,000.  San Marino does not maintain a separate customs area and has 
the same currency as Italy. 
 
The Vatican City has a population of 1,000, covers an area of 44 hectares 
(109 acres), and is located completely within the city limits of Rome. While 
the Vatican is the smallest state in the world, it has its own railway, 
coins, stamps, and passports. 
 
Italy's population is 57.8 million and with one of the world's lowest birth 
rates and highest longevity rates, the population is graying rapidly. 
 
Italy is one of the original members of the European Community (EC) and 
remains a staunch advocate of a unified Europe.  It has the fifth largest 
industrial economy in the world, but in recent years Italy has been 
 
 
experiencing difficult economic problems. A series of weak coalition 
governments have been unable to implement the reforms needed to cure some of 
Italy's long-standing ills.  The public sector deficit continues to be above 
10 percent of  GDP each year; dozens of EC directives are still waiting to 
be implemented into national law, and the governmental presence in the 
market is large. 
 
However, these factors must be weighed against a surprisingly resilient 
private sector, which has kept Italy's exports growing in areas such as high 
value consumer goods and specialized tooling, and a determination by the new 
government to put Italy back on track on issues related to the budget, 
public debt, and competitiveness. Despite considerable resistance by the 
traditional parties and the industries concerned, Italy is now moving 
towards privatizing some of its huge government-owned stake in industry and 
services. 
 
The EC's efforts to develop a single and unified European market has placed 
pressure on Italy's traditional approach to government and business. New 
directives from Brussels will create the need to make changes to meet new 
competitive conditions. Although Italy has made progress in fields such as 
telecommunications, transportation, and other infrastructure, much more 
remains to be done to provide an efficient infrastructure and public 
utilities. Italy's northern regions are concerned about the inefficient and 
expensive methods of aiding development in the Mezzogiorno (regions south of 
Rome). Also, the Italian manufacturing and distribution system lags behind 
that of its major trading partners.  While small size and tight quality 
controls have done wonders for the economic well being of hundreds of 
thousands of entrepreneurs, the Italian consumer is somewhat at a 
disadvantage if compared to the Northern European consumers. The Italian 
distribution system is fragmented and  regionalized and will face strong 
price competition from other European countries. 
 
In general, the Italian business scene closely matches the socio-cultural 
environment with the family as the primary social cell. Close ties and 
networking are also important to political affiliations, sporting groups, 
regional affiliations, and of course business connections. The concept of 
competition as a promoter of economic development is slowly creeping in, but 
is hampered by the huge size of the public sector which sees monopoly as a 
factor of stability and survival. 
 
Foreign Trade Outlook 
Italy's export-oriented economy dictates the need for the pursuit of liberal 
foreign trade policies. Italy belongs to the Organization for Economic 
Cooperation and Development (OECD), the International Monetary Fund (IMF), 
and the U.N. Economic Commission for Europe, and it is a signatory to the 
General Agreement on Tariffs and Trade (GATT). Italy is also a founding 
member of the EC and has its customs duties (tariffs) and some  elements of 
its trade and domestic policy governed by its membership in the European 
Community (EC). 
 
 
                                  Table  1 
                       U.S. - ITALY   TRADE   HISTORY 
                         (Trade data in billions $) 
 
                                            U.S. Trade      Lira per 
Year    U.S. Exports      U.S. Imports       Balance      U.S. $1.00 
 
1970        1.352             1.317          +0.035           625.0 
 
 
 
1971        1.314             1.406          -0.092           619.9 
1972        1.426             1.755          -0.329           583.2 
1973        2.119             1.988          +0.131           583.0 
1974        2.756             2.591          +0.165           650.3 
1975        2.868             2.491          +0.377           652.8 
 
1976        3.068             2.545          +0.523           832.3 
1977        2.788             3.074          -0.286           882.4 
1978        3.360             4.175          -0.815           848.7 
1979        4.358             5.046          -0.688           830.9 
1980        5.511             4.377          +1.134           856.4 
 
1981        5.360             5.191          +0.169         1,136.8 
1982        4.616             5.301          -0.685         1,352.5 
1983        3.908             5.455          -1.547         1,518.8 
1984        4.375             7.934          -3.559         1,757.0 
1985        4.625             9.674          -5.049         1,909.4 
 
1986        4.838            10.607          -5.769         1,490.8 
1987        5.530            11.040          -5.510         1,296.1 
1988        6.775            11.576          -4.801         1,301.6 
1989        7.215            11.933          -4.718         1,372.1 
1990        7.992            12.751          -4.759         1,198.1 
 
1991        8.570            11.764          -3.194         1,225.0 
1992        9.4 *            11.7 *          -2.3 *         1,080.* 
 
*  Projected for 1992 
Sources: U.S. Bureau of the Census for trade statistics 
         IMF International Financial Statistics for exchange rates. 
 
Italy has relatively few domestic natural resourcs and must depend on a 
heavy volume of imports of energy, semimanufactured goods, capital goods, 
and raw materials. 
 
In 1991, the United States accounted for 6.2 percent of total Italian trade 
(imports and exports) with the United Kingdom also at 6.2 percent, after 
Germany (21.0 percent), and France (14.7 percent). The United States is 
Italy's third most important source of imports and third most important 
destination for exports. Table 1 reviews bilateral trade between the United 
States and Italy. 
 
Reversing the direction of trade, Italy represents the United States' tenth 
most important export destination and seventh most important source of 
imports. 
 
European Community 
As a member of the European Community, Italy must ensure that its domestic 
legislation complies with the directives developed by the EC according to 
the terms of the Treaty of Rome. There are four main institutions of the EC 
that carry out the drafting and administration of the legislative process -- 
the EC Commission, the European Parliament, the Council of Ministers, and 
the European Court of Justice. 
 
The Commission makes proposals for EC directives, and the Council of 
Ministers decides whether to accept or reject the proposed legislation. The 
EC Commission is located in Brussels and is composed of 17 commissioners, 
each of whom is appointed jointly by the EC member governments. Each 
commissioner is responsible for several directorate-generals which function 
as the civil service in conducting the daily activities of  the EC. 
 
 
 
Once developed and approved by the Commission, a proposed EC directive is 
then passed to the European Parliament in Strasbourg for approval. The 
Parliament is composed of 518 members directly elected by voters in the 
member countries. Parliament conducts two consecutive readings on proposals 
and can approve, fail to disapprove, reject, or recommend changes to a 
proposed directive. 
 
The Council of Ministers is the main legislative and decision-making body in 
the EC. The 12-member council is composed of foreign ministers or cabinet 
officials from member state governments and represent the individual 
national governments. The Council of Ministers has power to veto or agree on 
proposed legislation. On certain proposed directives, the council voting is 
based on a weighted vote system. The presidency of the council is rotated at 
6-month intervals so that each member country will have some authority and 
responsibility over Community affairs. 
 
Once a proposed directive becomes approved, each member state must then 
incorporate the terms of the  directive into its own national legislation 
within a specific time unless the country obtains a derogation because of 
special circumstances. The final arbiter over disputes of EC law is the 
European Court of Justice. The European Court is composed of judges 
appointed by agreement of the member states for 6-year terms. 
 
EC Single Internal Market 
The European Community has embarked on an ambitious program to develop a 
more united and barrier-free internal market for trade among the 12 member 
countries.  As an EC member, Italy participates fully in this program. The 
program of product standards harmonization is intended to create a single 
internal market of 340 million consumers with freedom of movement for goods, 
services, labor, and capital.  The purpose of the program is to develop 
greater competition, production efficiency, and lower prices for the 
consumer. 
 
For more details on European Community product standards and certification 
requirements, contact:  Single Internal Market Information Service, 
International Trade Administration, Room H-3036, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, N.W., Washington, DC 20230, 
(202) 482-5823. 
 
The Community will continue to develop and adopt common directives that will 
establish new EC-wide requirements for a broad range of business activities 
and result in the harmonization of standards for all 12 EC countries for 
thousands of products. The single internal market program is expected to 
create greater economic growth, improve production and marketing 
efficiencies, increase competitiveness, and lower costs to the consumer. It 
will also create new EC product standards and regulations that will have to 
be adhered to by all suppliers to the EC market. 
 
The development of harmonized standards presents both a challenge and an 
opportunity for American firms doing business in the EC. American industry 
must be informed and respond to the changes and new competition in the 
commercial environment. American firms seeking to sell products in Italy, or 
to establish a business operation there, should review both the Italian and 
EC regulations. In many cases, the national product standards are being 
replaced with unified EC-wide standards. These unified standards will make 
it easier for U.S. suppliers to produce for export to the EC since one 
product will be accepted for sale in all 12 countries. Steps are also being 
taken to harmonize national procedures for product testing and certification 
and to establish a common EC trademark and copyright laws. 
 
 
 
 
 
BEST U.S. EXPORT PROSPECTS 
 
Over the years, the United States and Italy have maintained extensive trade 
ties. Some of the product sectors identified as having the best sales 
prospects for U.S. exporters are outlined below.  This section is intended 
to provide only an illustrative sampling of the marketing opportunities in 
Italy. The U.S. and Foreign Commercial Service in Italy has prepared a 
series of marketing briefs that provides more information on sales 
opportunities in Italy.  The reports may be obtained from the National Trade 
Data Bank. The local  Commerce Department district offices can be contacted 
for additional details and exporting assistance. 
 
Software 
The computer software and services market in Italy increased 15 percent in 
1991 and is expected to continue as a leading sector.  While competition and 
market saturation will lower the growth rate into line with the average rate 
of other major countries, this sector will remain strong for cost-effective 
products.  Decreasing profitability, due to price competition and 
inefficient distribution channels, may also affect future growth rates in 
value terms.  Software demand is strong for quality and advanced products. 
The United States should continue to be Italy's number one supplier of 
software, with over 65 percent of total imports originating in the United 
States. 
 
Pollution Control 
The pollution control industry is experiencing considerable growth in Italy, 
especially because of the recent introduction of new environmental 
regulations to comply with EC directives.  Budget problems at both national 
and local government levels hamper what should be a very dynamic market. The 
Italian industry is interested in American expertise and instrumentation, as 
U.S. technology and standards are highly regarded and recognized.  Over the 
medium term, major growth is expected in the waste treatment and management 
segment.  Good business opportunities should exist for American firms 
offering safe recycling and recovery technology, dumping site techniques, 
refuse-derived fuel technology, and incineration technology.  Management 
services for water purifying plants and collection and management of urban 
and industrial solid hazardous and nonhazardous wastes are becoming more and 
more important and represent a hefty portion of the market demand.  Because 
of a new law which prohibits the utilization of asbestos and requires its 
controled removal and disposal, opportunities may also exist for U.S. firms 
offering innovative technologies in asbesos removal. 
 
Computers 
The Italian market for computers and peripherals is still one of the most 
dynamic national industry sectors, despite a recent slowdown in growth rate. 
While mainframes are still experiencing a good growth trend, low-end 
proprietary minicomputers suffer from market saturation and  strong 
competition of multi-user, local area network personal computer systems. 
The major growth is expected to be in the areas of workstations with 
operating systems and laptop and notebook personal computers. Solid business 
opportunities exist for American companies that offer a combination of the 
best in technical sophistication, engineering design, commercial 
reliability, and competitive pricing. 
 
 
Telecommunications 
The telecommunications sector currently attracts great interest and is 
 
 
experiencing considerable development in Italy.  The combination of the 
political awareness of the strategic role of telecommunications and measures 
enacted by the EC will be influencing this market over the next few years. 
Development of satellite systems for the business community, installation of 
optical fiber cables, conversion to digital switching, and the market for 
cellular services are a few examples of market expansion. Italy is a market 
that is adapting to technical changes, the deregulation process, and growth 
in demand. Growth  is not uniform throughout the market; therefore, U.S. 
firms should first look to mobile telephones and value-added services as the 
most profitable subsectors. With a proliferation of local and regional 
television and radio stations, there is steady demand for advanced 
broadcasting equipment and accessories. 
 
Aircraft and Parts 
The Italian market for aircraft and parts for maintenance has seen a 
somewhat reduced growth from 1990-1992 as compared with the trend in past 
years. However, the market should regain momentum in view of recent 
refinancing of programs under Law N808, of December 24, 1985, the so-called 
Joint Venture Law and of the continuing implementation of the National Space 
Program through 1994. Therefore, aircraft purchases should continue as 
Alitalia, the state-controlled commercial airline, is broadening and 
improving its services by deploying new aircraft.  The importance of imports 
to the domestic market remains high. The Italian aviation and aerospace 
sector has high regard for U.S. products because of their technical 
sophistication, advanced technology, and unique design. Competition from 
European industries is increasing, but U.S. commercial leadership is 
unanimously recognized. 
 
 
Energy Sector 
As one of the world's most industrialized countries, Italy needs energy to 
continue expanding. The country is dependent on imports of oil, coal, and 
natural gas. Oil constitutes the primary source producing 60 percent of the 
energy. Natural gas supplies 25 percent, followed by coal with 10 percent. 
Other sources, such as geothermal energy and hydroelectricity represent only 
6 percent of national energy production and is scattered among 25 power 
plants. 
 
Nuclear power plants are nonexistent, as environmental and safety concerns 
have caused the government to close existing plants and to halt the 
construction of new ones. There is also concern about the pollution stemming 
from coal generated electricity. Over all, there is intense interest in 
energy conservation methods and in developing  alternate sources to fossil 
fuels. 
 
The main obstacle to a more rapid development of alternative fuels has been 
high prices relative to the abundant supplies of cheap oil and coal. This 
situation has been changing recently as a result of market adjustments. To 
encourage increased capital investment and seek innovative solutions in 
reducing pollution, legislation was approved (Law 308 and Provision 15/1989 
of the Interministerial Committee for Prices) to provide incentives for the 
production of clean energy at reasonable prices. 
 
There are opportunities for U.S. companies in solar energy and in the 
biomass sector. Although Italian production is largely self-sufficient for 
biomasss appliances such as stoves, ovens, and fireplaces (80 percent of the 
total market), there are still good opportunities for U.S. companies 
supplying biomass equipment for large industrial or agricultural use. 
 
Electronics and Components 
 
 
Market demand in the electronics and components sector is expanding 
continuously with the increased digitalization of consumer and industrial 
equipment.  Italy imports large quantities of components, especially 
semiconductors for the telecommunications, automotive, and automation 
industries. U.S. suppliers will find best sales prospects in areas 
traditionally dominated by American technology, such as computers and 
military industries.  Due to Italy's participation in European research 
programs, good prospects also exist for satellite communications equipment. 
 
 
Health Care 
The local health care system provides free medical assistance to all Italian 
citizens. There are presently 1,120 public hospitals with 367,600 beds and 
650 private clinics with 72,600 beds. The Italian market for electromedical 
equipment relies heavily on imports. Technologically advanced products such 
as nuclear magnetic resonance imaging equipment and computerized axial 
tomography equipment have very good market potential. Ultrasonic and imaging 
equipment will continue to increase its market share. Electromedical 
equipment, such as anesthesia and resuscitation equipment, electrosurgery 
equipment, including lasers and intensive therapy equipment, if supported by 
technologically advanced features have excellent market potential. Leading 
U.S. manufacturers are present in Italy either directly or through 
experienced representatives that are capable of providing after-sales 
service.  American, Japanese, and German companies are the leading foreign 
suppliers to the local market. Superior technology with reliable local 
representatives is the winning card. Demand for innovative products will 
continue to be very high. 
 
 
Sporting Goods 
Sporting goods has shown a continuously favorable trend in Italy. There is a 
strong demand for apparel and accessories  because of the increasing 
interest in sports by middle-aged consumers. Tennis, cycling, skiing, golf, 
riding, sailing, swimming, and gymnastics are the most popular sports 
activities in Italy. The apparel subsector holds 78 percent of the total 
market: it is dominated by local firms supplying 80 percent of total 
consumption. The shoes and sports equipment subsectors (accounting 
respectively for 16 and 7 percent of the total market) are open  to imports. 
Innovative technical features, sophisticated styles, and high performance 
are the prerequisites for success in the Italian market. American sporting 
goods enjoy a  fine image and reputation. 
 
Electrical Production 
Italy is concerned about the rising domestic demand for electrical power and 
the consequent need to import  electricity from neighboring countries such 
as France, Austria, and Switzerland.  Therefore, the emphasis is on energy 
production investments (including incentives to self-producers), energy 
source diversification, promotion of conservation technologies, and the 
utilization of renewable sources.  Particular attention is being  given to 
the planning and construction of new coal-fired power plants.  ENEL, the 
state-owned National Electric Power Agency, the major end-user of power 
generating equipment and systems, approved a $30 billion investment program, 
thus influencing the overall future market demand.  U.S. manufacturers and 
suppliers should concentrate their marketing efforts on highly sophisticated 
and innovative products and systems while maintaining, and possibly 
improving, their leadership in licensing and technical cooperation, as the 
majority of Italian-built heavy electrical machinery is manufactured by 
Italian firms under U.S. licenses. 
 
 
 
 
Water Technology 
Italy is experiencing a severe water crisis, as the 11,000 aqueducts that 
supply the country with water are inadequate to meet internal demand. 
National emphasis is being placed on upgrading the system, with the 
government planning to invest over $16 billion over the next several years. 
Estimates indicate that total costs to make the system efficient in the next 
10 to 15 years, including the construction of new aqueducts, the search for 
deeper and nonpolluted aquifers, and the remediation of the polluted ones, 
should reach $100 billion.  Serious problems also exist with the inadequate 
sewage system, the eutrophication of the Adriatic Sea, and heavily polluted 
rivers such as the Po and the Lambro.  Investment plans amounting to $2.5 
billion have been approved or are under consideration. In spite of the 
emergency situation,  budgetary problems at both national and local level 
and the slow allocation process may hinder the development of safe water 
supplies in the short term.  Investment plans for $1.8 billion in the next 3 
years have also been approved to cope with the numerous problems of the city 
of Venice -- from the high and damaging tides to the practically nonexistent 
sewage system.  The water technology sector, however, represents a 
potentially lucrative market for those U.S. companies offering sophisticated 
equipment and know-how which are willing to enter the Italian market through 
joint-venture agreements. 
 
Franchising 
The franchising system is expanding rapidly in Italy although its expansion 
still lags behind that of  most other European countries. The existence of a 
small-scale retail network and the strong tradition of individuality and 
personal attention to clients that characterizes local business units have 
prevented a more rapid growth of the franchising industry. There are 
presently some 260 franchisors which control a network of 12,000 
franchisees. It is estimated that close to 20 new brands are introduced 
every year. The sectors where franchising has been most successful are 
apparel, which ranks first with 120 franchisors and 3,600 franchisees, and 
mass distribution with 17 franchisors and 2,400 franchisees. Services ranks 
third with 38 franchisors and 2,700 franchisees. Specialized food stores, 
fast-food restaurants, and nonfood specialty stores are expected to grow at 
a very fast pace. Foreign franchise organizations are making their way into 
the Italian market, and U.S. companies have been well received. There are 
good opportunities ahead in Italy, as new European-wide patterns and trends 
in commerce, distribution, consumption, and tastes emerge. 
 
Cosmetics 
The Italian market for cosmetics is characterized by a strong demand for 
quality and sophisticated products.  The development, by means of 
biotechnology, of new basic ingredients for cosmetics will favor products 
with innovative, effective, and safe formulas.  U.S. firms with close 
connections to research institutes will have success. Consumer preferences 
in sales channels continue to shift with purchases in pharmacies increasing 
and perfume stores experiencing a sales drop.  Mass market distribution 
channels are growing rapidly  as consumers are now more attentive and 
informed. Hair dressing salons suffered a fall in attendance, while 
door-to-door sales, in which U.S. firms have a leading edge, remain rather 
stable.  Perfume and eye shadow sales are being penalized by overproduction 
and extensive competition.  Specialized products such as sun and after-sun 
products, eye wrinkle protection products, masks, and anti-aging products 
are doing well. Nail care products and artificial nails are making a 
breakthrough into the skeptical Italian market. Creative advertising 
continues to be considered a key factor in market success. 
 
Industrial Process Controls 
Industrial process controls include all applications for the automation of 
 
 
both chemical and physical processes and manufacturing processes. This 
definition includes all equipment used for measurement and control as well 
as computers and software used in process control operations. The Italian 
market in this sector is Europe's fourth largest. Most of the growth in 
Italian manufacturing was due to an increasing demand for automated plants 
and machines. This growth trend is expected to continue until 1995 with the 
value of industrial control devices expanding from the present 11 percent of 
the total cost of a plant up to 20 percent of investment.  The market for 
automation and process systems was $1.8 billion in 1992 with growth 
prospects very promising. Another emerging subsector that is small, but has 
large and consistent growth, is artificial vision for product quality 
inspection and control. The cost-savings applications of this equipment 
should increase the potential number of end-users in the next few years. 
Small- and medium-sized American companies with sophisticated, high-quality 
products will find an excellent and receptive  market in Italy. 
 
Packaging Machinery 
Italy is the fourth largest producer in the world of packaging machinery and 
equipment. The Italian industry's success can be explained by its high 
standards of quality and flexibility.  The packaging industry is considered 
one of Italy's leading sectors for the application of new industrial 
technologies.  U.S. manufacturers utilizing technological advances to 
develop better microwavable packaging, more tamper-evident closures and 
packaging, new aseptic packages, and innovative equipment, such as automatic 
quality control systems,  could compete for a larger share of the Italian 
market. 
 
Security Equipment 
The market demand for security equipment continues to grow as rising crime 
rates cause deep concern and stimulate demand for increased security. 
Government entities, banks, and private citizens are now allocating more 
funds to this area. The import climate is favorable, but product design and 
performance are increasingly important competitive factors as private and 
public end-users demand the most innovative products. Customer service is 
another key element in marketing security and safety products in Italy. 
Considerable importance is given to products' technical features and 
reputation.  A knowledgeable sales staff is needed to provide expert advice 
in both the purchase and the after-sales service stage. 
 
Apparel 
The Italian market for apparel is extremely sophisticated. Local production 
is quality and style oriented and dictates fashion trends both domestically 
and abroad. Numerous local manufacturers utilize inexpensive foreign labor 
to offset high domestic costs. U.S. products have acquired and consolidated 
a market niche in the quality sports and leisurewear sector. Demand is for 
trendy apparel, with a distinct "American" look and a high content of 
natural fiber.  Design and quality, combined with durability and the use of natural dyes, are added pluses for U.S.-made apparel. Jeans and beachwear, 
jackets, leatherwear and outerwear, supported by a promotional campaign and 
name brand recognition, will continue to be favored by the very fashion 
conscious Italian consumer. 
 
 
DISTRIBUTION AND SALES CHANNELS 
 
American business representitives will find that selling in Italy offers new 
challenges, but it presents no overwhelming problems. Over 7,500 American 
companies are actively represented in Italy, with approximately 850 of them 
having subsidiaries there. 
 
 
 
U.S. executives may find that some commercial practices differ from those in 
the United States, but most will look very familiar. The system of retail 
and wholesale distribution, for instance, centers on small family-operated 
stores, although the supermarket-type operation has gained in importance and 
there are a number of substantial department store operations. 
 
Marketing Areas 
Italy is almost evenly divided into an industrial northern half and a more 
agricultural southern half where economic and market conditions are very 
different. The northern area, with a heavy concentration of large 
commercial, financial, and industrial enterprises, is a ready market for all 
kinds of capital and consumer goods.  It accounts for about 65 percent of 
total Italian imports and is located near important European industrialized 
areas. Per capita income in the north is almost twice what it is in the 
south and the standard of living in the north resembles that of France and 
Germany. The area's vast industrial complex offers a steady demand for new, 
more advanced machinery and equipment. 
 
Administratively, Italy is divided into 20 regions which are in turn further 
divided into provinces.  Each province is named after the main city or town 
that serves as the capital and administrative center of the province. 
 
The population of Italy in 1991 was 57.8 million with a very low growth 
rate. Rome, Milan, and Naples all have populations of over 1 million people, 
but the marketing areas of these and other large cities extend beyond their 
boundary lines and reach a population much larger than that of the cities 
themselves. See Table 2 for the populations of Italy's largest cities. Each 
of the major cities serves as the nucleus and administrative center of a 
particular province. Thus, Lombardy whose capital is Milan, has a population 
of over 8.5 million. Piedmont, whose capital is Turin, has a population over 
4.5 million. There are about 15 million people in the relatively small area 
of the Milan-Turin-Genoa industrial triangle. The Lazio Region, where Rome 
is located, has a population of 5 million and  Campania, with Naples as the 
capital, has a population of 5 million. 
 
                                  Table  2 
 
Population of  Italy's 10 Largest Cities 
Rome              2,693,400 
Milan             1,371,000 
Naples            1,054,600 
Torino              961,900 
Palermo             697,200 
Genova              675,600 
Bologna             404,300 
Firenze             402,300 
Bari                341,300 
Catania             330,000 
 
The country's leading commercial and industrial center is Milan. This city 
has throbbed with economic activity for centuries and is the center of 
Italy's business activities. It serves as headquarters for most of the large 
industrial and international firms in Italy. Many firms, including those 
importing foreign products, usually direct their sales efforts from Milan. 
This city is also the seat of  many of Italy's leading industry and trade 
associations. The American Chamber of Commerce in Italy has its headquarters 
in Milan. 
 
The population of Milan is over 1.3 million, with a concentration of 
industrial workers and is considered the major commercial center of Italy. 
 
 
With a preponderance of  highly paid workers, Milan  sets the pattern for 
tastes, consumer preferences, and demand of the area. Turin is another 
important commercial and industrial city in the north, and, as Italy's 
automobile capital, it is also one of the country's best markets. Fiat 
automobiles as well as many subsidiary products of the motor and 
metalworking industries are manufactured in Turin. The regions of Piedmont 
and Lombardy together account for about 30 percent of Italy's gross national 
product. They are the richest and most sought after markets in Italy. Genoa, 
Italy's major port, is another important northern commercial and industrial 
center. 
 
Further south, the capital city of Rome, in addition to serving as the 
location of government administration and procurement, contains the 
headquarters of many state-controlled enterprises, including the defense 
industries, the oil industry, and the airlines. The state enterprises 
include transportation services, the national electric company, and many 
major industrial operations. Rome is Italy's largest city and is an 
important marketing center serving as a distribution hub for other parts of 
central and southern Italy. 
 
Naples, a large port city serving Rome and the south, is an industrial city 
whose importance is continuously increasing under government development 
programs. The areas surrounding the cities of Bari-Brindisi and Taranto also 
have been stimulated by considerable government assistance and private 
investments, and now stand out as the most economic developed in southern 
Italy. 
 
Retail Distribution in Italy 
With a population of 57.8 million, the Italian retail distribution sector is 
large in total sales although it serves the consumer at the retail level 
through numerous small, family-owned, retail outlets rather than large, mass 
market operations. See Table 3 for sales by store class. The market offers 
many commercial opportunities because of the large sales volume and a lack 
of competitive companies. Most retail stores in Italy can operate no more 
than 44 hours per week and must remain closed on Sundays and Monday 
mornings. Bill 426 of 1971 restricts the opening of new large retail outlets 
in order to maintain and encourage the small family-owned traditional 
stores. However, with time, the pressure of competition and the demands of 
sophisticated consumers will gradually introduce change in the distribution 
system. 
 
In order to satisfy sophisticated Italian consumers, firms operating in the 
Italian retail distribution sector find that they must invest large amounts 
of money in new techniques, management, research, media promotion, and 
equipment. The industry's average return on investment is approximately 13 
percent. In terms of existing points of sale, there is a trend from the 
family-type stores and street vendors, and to the distribution chains. 
 
 
                                  Table  3 
 
Retail Distribution 
                               Sales in millions of dollars 
                                 1987       1988     1989 
 
Small Food Retail Outlets       243.8      239.6    223.0 
Nonfood Retail Outlets          423.2      430.1    411.8 
Food Street Vendors              30.4       30.0     29.0 
Nonfood Street Vendors           55.6       56.8     53.2 
Other (nonfood)                 186.3      188.9    181.5 
 
 
Distribution Chains (food)        2.2        2.4      2.6 
Department Stores (nonfood)       0.6        0.6      0.6 
                              --------   -------  ------- 
Total                           942.1      948.4    901.7 
 
Horizontal points of sale such as general stores, which had experienced boom 
conditions in the early 1980s, have begun to lose ground to specialized 
stores, franchising chains, and hypermarkets. In order to create a unique 
business identity, department stores have begun a process of realignment and 
now tend to attract the more affluent, quality-oriented consumers as well as 
compete on price and product selection. 
 
In the food sector there are some 355,000 licensed food outlets operating in 
Italy. Although family-type stores and street vendors comprise over 95 
percent of these food retailers, their overall sales volume account for only 
70 percent of total expenditures. The highly industrialized north, with 44 
percent of the country's population, produces 52 percent of the gross 
national product and also has the highest concentration of large 
distribution chains. 
 
Supermarket chains now look toward further expansion, particularly in 
creating and operating large shopping malls. Where such shopping centers 
exist, they are proving to be successful. 
 
A Changing Market 
The combined pressures of consumers with higher expectations and the 
increased competition have forced distribution chains to rethink their 
marketing strategies. In the past, the retail chains have relied heavily on 
low prices as a marketing strategy, and this strategy has yielded positive 
results. Investment in advertising was high and mainly trade oriented, while 
services and convenience were considered important but not fundamental. 
Recently, consumers' expectations have been redirected toward better store 
accessibility, improved customer service, and higher quality products. 
 
However, large distribution chains involved in aggressive growth strategies 
will face several challenges. First, as far as accessibility is concerned, 
Law 426 restricts shopping centers of 1,500 square meters and over to 
suburban areas. Second, promotions aimed at the consumer will absorb an 
increasingly higher percentage of the chain stores' promotional budget. 
 
There are many logistical problems of operating a nationwide sales network 
as well as managing the growing personnel and promotion costs. Part-time 
employment is presently restricted  although there are now some move to 
liberalize restrictions. Marketing firms are developing new distribution 
techniques designed to employ the casual worker and to target groups of 
consumers by catalog, door-to-door sales, teleshopping or telemarketing. The 
most widely used methods of direct marketing are: 
 
 Direct selling, mainly used in the nonfood sector. 
 
 Mail order, catalog sales, or orders placed directly with the supplier. 
 
Mail order marketing has been operating in Italy for approximately 15 
years.  Although direct marketing is considered a very effective marketing 
technique, it  still remains a modest channel of distribution for Italian 
companies. One of the disadvantages of this technique, which may be 
overlooked by foreign investors, is frequent delays by the postal system. 
The establishment of a semiprivate nationwide express mail service, the 
proliferation of couriers, and the arrival of foreign parcel delivery 
services now offer alternatives to the national mail system. 
 
 
 
Telephone direct marketing is growing faster than any other selling 
technique. With the development of new telephone equipment, the business 
world has turned to the use of the telefax, making Italy the second largest 
per capita user in the world. 
 
Teleshopping (buying by telephone) is becoming a popular sales approach to 
reach the consumer. There are a number of privately owned television 
stations which mainly host telemarketing programs. 
 
Telecommunications technologies are playing an increasing role in the 
process of restructuring the distribution system. Scanners, electronic cash 
registers, and display management systems are now common while computerized 
stock control systems, customer databases, and inventory control programs 
are being used only by the large distribution networks. The more 
sophisticated groups have also resorted to consulting services, resulting in 
technical cooperation agreements between a number of Italian and 
international chains. 
 
The Italian retail distribution system is faced with new challenges of 
competition and technology. It is in the process of being reorganized in 
terms of number of points of sale and of marketing strategies. The small 
traditional retail outlets are considered obsolete, but the Italian 
distribution groups are still too small in many cases to compete effectively 
with large chains operating in some of the other European nations. A process 
of internationalization is now taking place among Italian and foreign chains 
with some agreements already signed. There is, however, room for more. 
 
Distribution Methods 
The marketing of products in Italy is accomplished through a variety of 
channels, depending on the nature of the product, the sales territory to be 
covered, the type of buyer, and the sales promotional activities required. 
Brokers, commission merchants, and independent representatives are used 
extensively for the sale of raw materials, semifinished products, and 
capital goods to the larger manufacturing organizations. However, 
well-established distributors are normally employed to reach industrial 
firms as well as the large number of wholesalers and retailers engaged in 
the marketing of consumer goods. 
 
Agency--Agency contracts are governed by the Italian Civil Code and by a 
number of other legislative decrees. An Italian agent for a foreign firm is 
generally regarded as being authorized to act for the firm. Depending on the 
contract, the principal may be subject to termination compensation payments 
and to income taxes and other levies on sales effected through the agent. 
 
Distributorship--Under this arrangement the local distributor takes title of 
the merchandise and assumes the risks, and has the obligation to pay any 
taxes. Distribution agreements are subject only to the terms of the contract 
itself. There are no laws or regulations currently in effect in Italy 
providing for advance notice of termination, termination compensation, or 
social security payments in connection with these agreements. 
 
Frequently, a distributorship agreement provides for exclusive sales rights. 
There is nothing in the Italian law preventing exclusive arrangements in all 
or part of Italy. However, if these agreements provide for exclusive sales 
rights in all or part of the EC, they should be examined carefully, and with 
the assistance of a competent international lawyer, in light of the 
antitrust provisions of the EC regulations. 
 
Direct Buying--Direct purchases of imported goods occur frequently in Italy 
 
 
with wholesalers and large retailers seeking to obtain the lowest cost from 
the manufacturer. Certain raw materials and some industrial machinery and 
equipment having limited markets are purchased by the end-users directly 
from foreign manufacturers or suppliers. Voluntary associations of food 
retailers and food wholesalers make substantial purchases directly from 
domestic or foreign manufacturers. 
 
Wholesale Outlets--Wholesale establishments are numerous in Italy, but most 
of these are still small firms. Their scope is limited to selling only to 
small retailers who are not in a position to buy directly from 
manufacturers. The larger retail outlets customarily purchase from local 
wholesalers only those items that they sell in small quantities. Many of the 
larger wholesalers in Italy are familiar with foreign trade practices and 
procedures and sell their goods on a countrywide basis. 
 
 
Retail Outlets--Retail trade is still dominated largely by small individual 
outlets run by the owner with the help of family members or with one or two 
paid assistants. Small firms are expanding and are adopting new 
merchandising techniques. Modern retail outlets, however, such as department 
and self-service stores, have been increasing rapidly, particularly in the 
cities. The number of stores handling food products exceeds those handling 
other lines. Food sales volume is limited by the consumers' traditional 
practice of making small purchases as needed on a day-to-day basis. 
 
According to the Ministry of Industry, there are 409,300 food retail 
outlets, and 513,500 retailers of nonfood goods in Italy. In addition, there 
are also some 217,000 coffee bars, ice cream parlors, cafeterias, 
restaurants and hotels, and some 236,500 itinerant or door-to-door sales 
representatives who sell foodstuffs, housewares, and textile goods. 
 
Department stores and supermarkets have gained wide public acceptance in the 
last few years, but these large establishments account for 7 to 8 percent of 
total Italian retail sales. There are some 800 department stores and 2,000 
supermarkets in Italy. Issuance of licenses for more department stores and 
markets has been limited by the goal of maintaining the existence of small 
retailers. Nevertheless, the expansion of chain and department stores is 
resulting in more and more centralized buying by head offices. 
 
The advent of large retail organizations has influenced the streamlining of 
other distribution outlets. Groups of wholesalers and retailers have formed 
associations for bulk purchases by their members. Approximately 150 
mail-order firms operate in Italy. Of these, 18 companies hold 75 percent of 
the market. However, the mail-order business in the 1990s is expected to 
show strong growth and profitability. 
 
Franchising--The franchising system is not currently widely used in Italy 
and offers good potential for American firms to extend management skills and 
marketing practices. Although efforts are being made to expand franchising 
operations, it is generally agreed that the parent company would need to 
make a solid commitment and long-term investment in company-owned outlets to 
establish its name, to educate the consuming public, and thus attract 
potential franchisees. 
 
Franchisors should also bear in mind that a business license is necessary 
for each outlet. These may be difficult to obtain, particularly if the 
franchise will be competing against small, independent, local companies. 
 
Leasing--It has become common to lease, rather than buy, certain types of 
machinery. The leasing of foreign machines is usually arranged with Italian 
 
 
clients through  local branch offices or agents of foreign manufacturers 
established to provide this marketing service. Leasing is complicated by the 
fact that the importation, payment of  customs duties, and other related 
business formalities must be taken care of by a firm established in Italy. 
Such tasks would usually be done by either an agent of the foreign 
manufacturer or by the Italian lessee. Because the lessee is offen not 
willing to assume the inconvenience of handling importation of leased 
equipment, local representation is usually necessary. 
 
Distribution by U.S. Firms--An American company that is successful in Italy 
becomes so because its products are marketed with the same diligence 
employed in the U.S. market. Whether the firm establishes a manufacturing 
operation or a sales branch, or appoints a commission agent, a stocking 
distributor, or a combination agent/distributor, the American exporter must 
make a long-term commitment to exporting and follow sound marketing 
practices in order to sell successfully in the Italian market. A key factor 
in this commitment to serving the overseas buyer is the local stocking of 
parts and giving priority to immediate shipment on request of the European 
customer. 
 
An American company that is entering the competitive Italian market is 
advised to commit the resources needed to market the products properly and 
establish long-term sales to achieve maximum sales volume. The appointment 
of a resident representative is extremely important.  For promotion of 
business and knowledge of the market, there is no effective alternative to a 
resident representative who is part of the local business community and 
readily available to customers. Having a local representative is 
particularly important when the product is complex and may be expected to 
require follow-up servicing or modification. Local representatives are 
familiar with the product and needs of the customer and are in a position to 
solve problems. Personalized service is frequently demanded by customers, 
creates goodwill, and often stimulates repeat sales.  Technical manuals and 
promotional literature should be in Italian.  Italy is a competitive market 
where a reliable supplier is important.  Local representatives with solid 
reputations and promotional material in Italian reflects a commitment to 
customer service and the prestige of the American firm. 
 
A number of U.S. firms maintain their own sales organizations in Italy. 
Still others sell through specialized importers or appoint sales agents who 
often are manufacturers' brokers. A large, well-established Italian firm 
with an efficient nationwide sales organization is likely to insist on an 
exclusive arrangement. About 7,500 U.S. firms are represented in the Italian 
market through agents, branches, subsidiaries, or licenses. Of these, nearly 
850 have a substantial direct capital investment in the form of stock as the 
sole owner or partner in an enterprise. Generally, the sales territory 
includes all of Italy. In other cases, the territory also covers the whole 
European Community depending on the type of product and degree of technical 
support needed. Italian distributors also have excellent contacts with 
Eastern Europe and  the Mediterranean Basin. 
 
Import Channels 
Italy has a variety of importers, sales agents, and distributors well versed 
in all aspects of international trade. Many goods are handled by importers 
who purchase for their own account and distribute throughout the country and 
Europe. Because of the size, accessibility, and competitive nature of the 
Italian market, importers may insist on an exclusive distributorship. If the 
importer is a well qualified and successful firm, an exclusive 
distributorship often yields the best results. Wholesalers constitute an 
important segment of the importers doing business in this manner. They are 
the primary source of supplies for the small- and medium-sized retail 
 
 
outlets, which often find it impossible to buy directly from manufacturers 
that require large orders. 
 
Purchasing associations are formed by independent retailers. These 
associations combine purchasing power and operate their own warehouses, thus 
performing a function similar to the wholesaler. 
 
There are many commission agents and brokers in Italy serving the domestic 
and European markets. An Italian representative can often provide an 
excellent starting point in exporting to Southern Europe, Eastern Europe, or 
North Africa. The Italian firm can easily handle the logistics, linguistics, 
transshipment, and stocks on behalf of the American firm.  However, if the 
American firm desires these activities to be performed, they should be 
explicitly stated in a contract or sales agreement. 
 
If the product normally has a high sales volume and low profit margin, the 
Italian firms seek to deal direct with the manufacturer. Sales to a 
department store, chain store, or end-user often gives best sales results, 
but requires greater promotional effort by the American exporter. The direct 
sales method eliminates the added shipping and warehousing expenses, but the 
U.S. exporter and Italian importer must handle the shipping formalities and 
work harder to ensure a successful business relationship. 
 
The introduction of products into the Italian market should come after the 
U.S. exporter has planned and reviewed the consumer and business 
environment.  See the Exporting Marketing Plan Outline on page 47 for 
suggested first steps to take in the planning phase. Product representation 
throughout Italy is facilitated by the unified and compact  market and may 
be achieved with any of the following distribution methods to cover the 
entire area, depending on the expected sales volume, product support 
requirements, and marketing techniques. However, these methods must be 
applied with the U.S. exporter being mindful of the advantages a local 
representative would have in serving the home market. 
 
  Establishing a sales office to serve the entire country and provide a 
distribution base for Western Europe. 
  Selling through an agent a or distributor whose activity may cover 
specified areas, the entire country, or include European-wide  sales. 
  Selling through established wholesalers or dealers. 
  Selling directly to department stores, chains, retailer cooperatives, 
consumer cooperatives, or other purchasing organizations. 
 
The U.S. exporter would be ill-advised, after having appointed a 
representative firm, to provide only product literature and samples and then 
expect to have good sales results. Regular communications and visits to the 
representative, particularly when newly appointed, by seasoned sales 
personnel or company technicians can reveal information on market 
developments and assist in the solution of any problems. Regular submission 
of sales reports can be a vital link to analyzing sales results and 
identifying potential problems before they occur. Italian firms can purchase 
products and services from international sources and have come to expect 
well-designed, high-quality products, with efficient after-sales service. An 
effective after-sales servicing system also should be incorporated into 
distribution plans. 
 
Appointing an Agent or a Distributor 
Italy represents a large and affluent market where language and personal 
relationships are valued when conduction business transactions. American 
firms have found that relying on local Italian sales agents or distributors, 
who have the contacts and understand the market, can most effectively 
 
 
develop sales. 
 
It is important to obtain specific legal advice on appointing an agent or 
distributor, but some general guidelines follow. All agent agreements should 
be in writing and state the marketing area and any exclusive arrangements. 
Termination of the relationship is the area that most frequently causes 
problems for American exporters. Generally, the civil codes protect the 
interests of the representative. In the absence of termination provisions in 
a written agreement, the law provides for a minimum notice of termination of 
4 months. Parties may agree to other terms, provided the notice of 
termination is not less than 1 month. An agreement with a definite period 
terminates on the agreed expiration date. If the parties continue to operate 
under the agreement after that date, the agreement is usually deemed 
extended for a further identical period but not for more than a year. If the 
American principal wants to terminate the relationship, notice of 
termination should be given, even with a definite term contract. 
 
The termination of an agreement without the required notice makes a U.S. 
principal liable for compensation. The Italian sales agent could seek to 
claim the amount of the commissions that would have been earned during the 
termination period or for the amount of actual damages suffered. In 
exceptional cases, and only for just cause (such as competition or fraud), 
an agreement may be terminated without notice provided the other party is 
immediately advised of the reason. In such cases, the courts may be 
requested to terminate the contract. 
 
At the expiration or termination of an agreement, by whatever means, an 
agent who has increased the value of the business is entitled, in principle, 
to an adequate remuneration which cannot exceed the average of the 
commissions in 1 year. Such claims by agents are subject to an expiration 
term of 1 year. 
 
Three kinds of agreements are commonly used: 
 
  Exclusive distributorships, where the distributor has the sole right to 
sell specified goods within a defined area. 
 
  Quasi-exclusive distributorships, where the distributor sells almost all 
the specified products within a defined area. 
 
  Informal distributor arrangements under which the grantor imposes heavy 
obligations on the distributor and which would cause damage to the 
distributorship if the grantor terminated the agreement. 
 
In the absence of mutual agreement, or the failure to meet contract 
obligations, a distribution agreement of indefinite term cannot be 
terminated by the grantor without reasonable notice or fair compensation. In 
general, grantors should consider protecting themselves by entering into 
agreements for definite periods rather than an indefinite period. Also, 
specific minimum performance clauses should be considered, such as percent 
of distributor's sales, minimum annual sales, number of business contacts to 
be made, etc., and grantors should propose that U.S. law and courts have 
jurisdiction. 
 
 
EC Legislation on Agents 
The careful selection of a dynamic representative is important for 
successful sales over the long term. The selection of a good sales 
representative is also essential because the EC legislation is restrictive 
regarding the termination of agents and distributors. The European Community 
 
 
Directive EEC 86-653 sets forth conditions on termination of a commercial 
agent and provides for appropriate compensation. 
 
Under EC legislation, a commercial agent is a self-employed intermediary who 
has continuing authority to negotiate the sale or the purchase of goods on 
behalf of another person, or to negotiate and conclude such transactions on 
behalf of the principal. 
 
Each party is entitled to a written document setting out the terms of the 
contract. The minimum termination notice is 1 month for the first year of 
service, 2 months for the second year, and 3 months for the third year and 
subsequent years. Agents must be compensated if they brought the principal 
new customers or increased the volume of existing business. 
 
The amount of indemnity may not exceed a figure equivalent to an agent's 
annual remuneration over the preceding 5 years or the average of the period 
in question. The indemnity is not payable if the principal has terminated 
the contract because of default by the agent or if the contract is 
terminated on grounds of age, infirmity, or illness of the agent. 
 
The local district offices of the International Trade Administration of the 
U.S. Department of Commerce offer an Agent/Distributor Service (ADS) to help 
U.S. firms find agents or distributors in Italy. The U.S. exporter seeking 
an Italian sales agent should ideally visit Italy to make an appraisal of 
the relative merits of the prospective agent. Besides acquainting the U.S. 
exporter directly with local market conditions and special sales 
characteristics, a visit also provides an opportunity to discuss policy and 
sales campaigns with the potential agent, and to review responsibility for 
customs fees, taxes, labeling, business procedures, and payments. These 
responsibilities should always be clearly defined before undertaking a 
long-term relationship. 
 
A continued and close working contact between the American firm and the 
agent or distributor is very desirable and should be developed early in the 
relationship. Certain products and equipment require servicing to maintain 
their useful life. The U.S. exporter should determine if servicing is needed 
and develop a distribution network to include such servicing by qualified 
personnel. To build trust, loyalty, and marketing skills, U.S. producers 
frequently bring their agents or distributors to the United States for 
training and marketing assistance. 
 
Wholesale and Retail Channels 
There are numerous well-established sales outlets in Italy. These firms, 
both at the wholesale and retail level, have traditionally been small units 
with high overhead. The trend is slowly changing to fewer units dealing with 
a greater volume and offering more competitive prices.The increased tempo of 
commercial and industrial activity, as well as suburban development, is 
slowly  bringing about changes in the distribution system. 
 
Wholesalers supply a variety of services to associated small retailers, 
including sales promotion, advertising, and retail training. In some cases, 
they combine as a group to purchase from manufacturers and then distribute 
the goods to their customers. 
 
Retail outlets range from the large department stores to the small shop 
owned and operated by an individual. Although some retail outlets are small, 
such enterprises are decreasing in number as efficiencies of scale and 
purchasing power become the major competitive factors bearing on profit 
margins. A trend toward larger outlets has been under way, with the 
formation of cooperative chains, expansion of department stores, 
 
 
establishment of medium-sized department stores, and the development of 
chain stores under single management. 
 
Mail-order sales account for a very small part of total retail sales. 
Certain firms have used this technique successfully in combination with 
their usual retail outlet operation. Promotion is carried out by catalog or 
by newspaper advertisements with no personal contact. Hobby centers, 
do-it-yourself, auto supply centers, and discount stores also are enjoying 
great success. 
 
When seeking sales in Italy, American firms should remember that the average 
Italian consumer demands quality and can select from a wide array of 
products from around the world. The Italians appreciate style, quality, and 
personalized service. Shopping is usually done on a daily basis, and shops 
are smaller and more personalized than those found in the United States. The 
Italians are friendly to Americans and are aware of U.S. styles, cultural 
activities, and events. Many have visited or lived in the United States. 
They are more reserved and formal on the initial meeting than their American 
business counterparts. Style is important but an ostentatious display of 
wealth is considered to be in poor taste. 
 
 
Transportation 
Railroad--The railroad system is nationalized and operated by the Italian 
State Railways (Ferrovie dello Stato, abbreviated FS), a government agency. 
The railroad provides an efficient and economical method of transportation. 
More than half of the rail system is electrified. 
 
Highway--The highway system is approximately 197,000 miles, including over 
3,000 miles of super highways called the autostrade. The network connects 
the major industrial centers and offers easy access to Northern Europe. 
Trucking services are operated mainly by private companies under government 
concession. 
 
Air--Alitalia, a state-owned company, is Italy's principal airline, 
providing both international and domestic service. Additional domestic 
service is provided by ATI, which is a wholly owned subsidiary of Alitalia, 
Itavia, and Alisarda airlines. Charter service is offered by SAM, also an 
Alitalia subsidiary, while air-taxi service is available from Unijet Italia 
in Rome and Agena in Milan. Italy has an extensive airport network 
consisting of 19 international, 17 domestic, and 59 general aviation 
airports. 
 
Sea--Italy has six major seaports--Genoa, Livorno, Naples, Palermo, Trieste, 
and Venice. In addition, there are 35 smaller ports mostly used for coastal 
shipping. 
 
Advertising 
Advertising in Italy has grown rapidly in volume, importance, and 
sophistication. This growth in advertising has been accompanied by a 
proliferation of advertising agencies and an expansion of services. Along 
with Italian-owned agencies, there are joint ventures with other European or 
American firms. While some agencies specialize in specific services and 
media, a large number of full service agencies deal with all advertising 
aspects and have market research facilities. 
 
The following is a breakdown of media use: newspapers, 35 percent; 
magazines, 35 percent; radio and television, 22 percent; movie strips, 2 
percent; and other methods, 6 percent. 
 
 
 
Newspapers and Periodicals--The main means of product advertising in Italy 
is through the daily newspapers. Newspapers work closely with advertising 
firms, both Italian and foreign. However, since the newspapers themselves do 
not maintain advertising departments, advertising firms must place their ads 
with special agencies commissioned by the papers to receive advertising for 
them. 
 
Of about 90 daily newspapers in Italy, only a dozen or so are read 
throughout the country, and while some 230 Italian and foreign periodicals 
are on sale in Italy, only about 20 have a large circulation. 
 
Television--Italy is served by three television networks operated by 
Radiotelevisione Italiana (RAI), a government-regulated company in which the 
state owns a majority interest. The three networks carry commercials in 
programs all day long. In addition, some 100 private television stations are 
licensed for local broadcasting. 
 
Radio--There are three radio stations owned and operated by RAI. These are 
on the air for more than 340 hours weekly, and commercial time is available. 
In addition to the three networks, there are numerous local radio stations. 
 
Motion Picture Theaters--Wide use of film clips is made for advertising 
purposes. There are some 10,000 motion picture theaters and many regularly 
show advertising. The rates for advertising vary according to the showing 
time and class of the theater. Advertising is shown during every 
intermission. Therefore, this medium may be used to reach a wide market and 
cut across economic strata. 
 
Posters and Billboards--Poster advertising is handled by a number of 
specialized companies, as is electric sign advertising, which is subject to 
special regulations. Poster advertisement on walls, along streets, in street 
cars, buses, and other means of transportation are used to reach the 
consumer market. Both posters and billboards are subject to the approval of 
provincial authorities and to payment of a tax on poster advertising. 
 
Show Windows and Flyers--Show window advertising is extensively used in 
Italy. Displays are usually attractively done and show prices of the items 
for sale. Advertising flyers are in common use, and street banners are used 
also for special occasions. Loudspeakers are used for advertising at 
sporting events. Direct advertising, through the distribution of gifts, 
samples, and price reduction coupons, is frequently used to interest 
consumers. 
 
For consumer products such as soap, soft drinks, and grocery items, it is 
not unusual to offer in the package a free gift or certificate, a discount 
coupon, or a chance in an advertising lottery. Free samples appear to be 
especially effective for consumer items of nominal cost and high repeat 
sales potential. Consumers are also quite receptive to advertising catalogs, 
which are frequently passed along from person to person. Distinctive and 
imaginatively designed letterheads and trademarks are quite important in 
publicizing a company and imparting an image of quality, style, and 
sophistication. 
 
 
Market Research and Trade Organizations 
Market research is closely related to advertising, and a number of firms 
specialize in this work. There are over 100 market research agencies 
operating in Italy, of which several are subsidiaries of well-known American 
companies. Large Italian companies, including the leading manufacturers of 
consumer goods, conduct market research either through their own specialized 
 
 
departments or through market research agencies. 
 
Most of the manufacturers' associations are members of the General 
Federation of Italian Industry (Confindustria), Viale dell' Astronomia 30, 
00144  Rome. This association publishes material of possible interest to 
U.S. businesspersons, including an annual review of the Italian economy, and 
a bulletin in English several times a year. 
 
There are chambers of commerce in all major Italian cities, and some, 
particularly those in large industrial centers such as Milan, publish 
economic reviews of their particular regions. A monthly review of the 
Italian economy is published by the Union of Italian Chambers of Commerce 
(Unione Italiana delle Commercio, Industria E Agricoltura), via Piazza 
Sallustio 21, Rome. The American Chamber of Commerce in Italy, Via Cantu' 1, 
Milan, publishes a monthly review in English containing information on 
current business developments. 
 
Several of the leading banks, such as the Banco di Roma and the Banca 
Nazionale Del Lavoro, also publish economic reviews. There are also a number 
of periodicals specializing in commercial and financial matters that provide 
marketing information. 
 
Marketing reports prepared by the Commerce Department's U.S. and Foreign 
Commercial Service in Italy are available on the Italian industry sectors 
identified as offering the best sales potential. These reports are made 
available to American exporters through the National Trade Data Bank (NTDB) 
or by contacting the nearest Department of Commerce district office. 
 
There are numerous advertising agencies with a wide range of services. The 
large ones provide a full range of advertising services and are members of 
the Institute of Advertising Practitioners, which is closely associated with 
the American Association of Advertising Agencies. 
 
Advertising agencies utilize every medium available to advertisers: direct 
mailings, press, radio, television, point-of-sale advertising, posters, and 
public transportation placards. Other promotional techniques, such as 
coupons, samples, premiums, and prizes, are also used. Laws covering gaming 
and lotteries as well as restrictive trade practices are strictly enforced 
by the government. Firms advertising and selling goods should obtain local 
advice regarding provisions of the laws and consumer acceptance of the 
promotional or marketing approach. 
 
The names of Italian advertising agencies, market research organizations, 
and management and public relations counseling firms may be found in such 
publications as the International Directory of Market Research Houses and 
Services, American Marketing Association, 420 Lexington Avenue, New York, NY 
10017, (212) 687-3280, and the Directory of Marketing Research Agencies and 
Management Consultants in the United States and the World, Bradford, P.O. 
Box 276, Fairfax, VA 22030, (703) 560-7484. 
 
Trade Fairs 
Exhibitions are a cost-effective method to enter a foreign market and meet a 
wide range of buyers interested in a particular industry sector. Sales 
professionals find that trade fairs attract extensive buyer attendance and 
frequently can be used to gauge acceptance and pricing of new products and 
to observe the competition. In the course of a few days, a new market 
entrant may be able to generate more qualified and motivated prospects than 
by using any other sales approach. Also, fairs are useful for finding an 
agent, distributor, or representative. The U.S. Department of Commerce 
frequently organizes events that are identified as having excellent 
 
 
prospects for American exporters. Information on participating in Italian 
trade fairs can be obtained from Department of Commerce district offices 
located throughout the United States. 
 
For information about trade fairs at Fiera Milano, the large international 
trade fair site in Milan, firms can contact Fiera Milano's U.S. 
representative for information by calling 1-800 524-2193. Fiera Milano 
organizes an extensive variety of international shows each year. 
 
Government Procurement 
The Italian Government and its agencies do not ordinarily make purchases 
abroad except when domestic suppliers cannot adequately meet the needs of 
government procurement offices. The term "domestic suppliers" includes the 
local subsidiaries, branches, and agents of U.S. firms, and importers and 
distributors of merchandise imported from the United States. It is strongly 
suggested that U.S. firms utilize the services of Italian agents and 
distributors rather than attempt to offer their products directly to Italian 
Government agencies. 
 
To be eligible for a government contract, a firm must establish its 
financial and technical eligibility by presenting its appropriate 
qualifications to the agency with which it wishes to do business. The 
required documents include the firm's legal structure, organization, 
manufacturing capacity, ownership, experience, and work accomplished in the 
past. 
 
Each Italian agency maintains its own list of eligible contractors and 
suppliers, and a firm must establish its eligibility directly with each 
agency with which it wants to contract. 
 
Each of the Italian Government agencies makes its own purchases except for 
office equipment and supplies. Such items are centrally procured by the 
government's central purchasing office, the Provveditorato Generale dell 
Stato, an agency operating within the Ministry of the Treasury. 
 
In addition to the central government agencies, there are 20 regional 
governments, 95 communal authorities, and about 30 state universities 
actively procuring a large variety of goods and services. 
 
The Italian Government owns, through several holding companies, all or part 
of the stock of hundreds of firms representing a large segment of industry. 
These firms, organized and operated as private enterprises, are free to buy 
from domestic or foreign sources whatever equipment and supplies they need 
for their operations. The general tendency among these firms, as well as 
among the majority of other large Italian industrial concerns, is to make 
every effort to eliminate what they consider to be the unnecessary costs of 
intermediaries. Consequently, they establish relations with Italian or 
foreign manufacturers who are in the best position to supply their needs. 
 
 
U.S. DEPARTMENT OF COMMERCE EXPORT SERVICES 
 
Export Programs 
The U.S. Commerce Department assists firms seeking to export products and 
services. The first step in the exporting process is to contact a local 
Department of Commerce U.S. and Foreign Commercial Service (US&FCS) district 
office. District offices are located in major cities throughout the United 
States and serve as the first point of contact for export assistance. Each 
district office maintains commercial reference materials, including market 
information and trade leads from overseas. The US&FCS also has offices 
 
 
located at U.S. embassies and consulates throughout the world which provide 
assistance and information to traveling business persons. 
 
The following is a list of Commerce assistance available for the interested 
exporter. Additional information is available from the local US&FCS district 
offices. 
 
 
  Foreign Economic Trends (FET) Report -- a report providing general 
economic and commercial background information on the Italian economy and 
identifying some of the best sales prospects. 
 
  Customized Sales Survey (CSS)--a survey of the overseas market that is 
custom-tailored for a product or service. Basic questions are researched and 
answered about the probability for success and the best approach to the 
market is identified for the product. 
 
  Agent/Distributor Service (ADS)--a search for potential agents, 
distributors, or representatives that are qualified and interested in 
dealing with a specific product in Italy or for any other country specified. 
 
  Gold Key--a schedule of appointments with qualified distributors in Italy 
arranged by the US&FCS trade specialists in order to assist a U.S. firm 
develop sales and reach its commercial objectives. 
 
  World Traders Data Report (WTDR)--a report providing an evaluation and 
background data on a foreign firm. 
 
  Single Company Promotion (SCP)--a promotional program tailored for a U.S. 
firm's product overseas provided by the US&FCS in Italy. Activities include 
press receptions, mailings, catering, speakers, and printing flyers to 
assist the American firm. 
 
  Trade Opportunity Program (TOP)--trade leads and investment opportunities 
provided by U.S. embassies and consulates around the world for U.S. 
exporters. 
 
  Commercial News U.S.A. (CNUSA)--a monthly illustrated publication of 
American goods and services that is distributed to over 110,000 foreign 
decisionmakers and importers worldwide. 
 
  Trade Shows, Trade Missions or Catalog Shows--trade events identified by 
the U.S. Department of Commerce as having excellent sales potential for 
American firms. 
 
Trade Information Center 
In addition to the Commerce Department's district offices located in major 
cities throughout the United States, the Trade Information Center also 
provides a one-stop source for information on all federal government export 
programs. The center can provide such information as: 
 
  How to get started in exporting 
  Foreign market research 
  Export financing 
  Locating overseas buyers 
  Trade missions and fairs 
  Export seminars and conferences 
  Where to obtain tariff rates and licensing requirements 
 
 
 
 
To reach the Center dial: 
 
        1-800  USA - TRADE  (1-800   872-8723) 
 
Business firms can call the Trade Information Center Monday through Friday, 
8:30 a.m. to 6:00 p.m. EST. Hearing-impaired can reach the Center by calling 
(1-800) 833-8723. 
 
 
National Trade Data Bank 
The National Trade Data Bank (NTDB) has been designed to bring a vast amount 
of trade statistics and overseas marketing information together for ease of 
access and increased use. By using the CD-ROM (compact disk--read only 
memory), the equivalent of more than 200,000 pages of exporting information 
is available. Additional information is added to the data base monthly. 
 
For the serious exporter, the NTDB is a powerful resource to learn about 
export markets, analyze trading patterns and trends, and understand trade 
practices of foreign countries and develop business contacts for 
distributing products overseas. 
 
The NTDB is available for public use in the Commerce district offices and at 
numerous public and university libraries throughout the United States. For 
those with a computer equipped with a CD-ROM reader, the CD disk is 
available for direct sale to the public. The cost of a single disk is $35; 
an annual subscription of 12 disks is $360. Users may place orders or obtain 
additional information on equipment needed to use the system by calling the 
NTDB Help Line on (202) 482-1986. 
 
Pitfalls to Avoid When Exporting 
In exporting there is no substitute for experience. The following provides a 
list of 10 of the most important steps a firm or individual should take 
before entering the international market. 
 
  Obtain qualified export counseling or study international trade procedures. 
 
  Develop a marketing and financial plan. Include specific dates and 
milestones to determine progress. Identify the key individual within the 
firm to achieve these results. 
 
  Ensure a commitment of time and resources by all levels of management to 
pursue exporting over the long term. 
 
  Take sufficient caution when selecting overseas agents or distributors. 
 
  Focus efforts on a core overseas market and expand in an orderly manner. 
 
  Do not neglect overseas clients when domestic sales increase or when 
attending a U.S. trade event. 
 
  Modify products to meet cultural preferences or product standards of other 
countries. 
 
  Provide product labels and sales literature in the local language and use 
metric units. 
 
  Use an export management company or broker if exporting is beyond the 
resources of the firm. 
 
  Consider licensing or joint venture arrangements to expand export sales. 
 
 
 
 
BANKING AND CREDIT 
 
Availability of Credit 
Italy has a well-developed banking and credit system with numerous 
corresponding U.S. banks.  The Italian banks are subject to close government 
supervision since the granting of credit and the administration of savings 
are considered functions of "national interest." The establishment of a new 
bank or the opening of a branch of an existing bank must be authorized by 
the Bank of Italy, the central bank of Italy. 
 
The Italian banking system consists of two sectors:  a commercial banking 
sector, which primarily accepts demand and short-term deposits, and a 
"special credit institutes" sector. Short-term financing for foreign and 
domestic firms is available from the commercial banking sector, including 
branch offices of many U.S. banks. The special institutes generally 
specialize in particular types of investment finance, for example, 
agriculture, industry, real estate, housing, and credit. The principal 
institutes for medium- and long-term industrial credit are the Istituto 
Mobiliare Italiano (IMI), Banca di Credito Finanziario (Mediobanca), and 
Ente Finanziario Interbancario (EFIBANCA). 
 
U.S. firms desiring to finance major portions of their capital investment 
outside the United States may find capital available in the Eurodollar 
market. Several major U.S. banks have branches in Italy, principally in Rome 
and Milan, to assist in financing capital investment. 
 
There are numerous banking offices located throughout the country, with 
nearly 1,100 banks and 14,000 branches performing commercial services. Among 
the most important are the Banca Nazionale del Lavoro, Banca Commerciale 
Italiana, Banco di Roma, and the Banco di Napoli. These banks are a 
principal source of credit information. 
 
Numerous U.S. banks perform banking services in Italy through branches, 
subsidiaries, or representatives. Many American banks can also provide their 
commercial customers with bank reports on an overseas buyer as well as 
provide assistance on letters of credit and foreign exchange. 
 
Foreign Exchange Policy 
Italy has no restrictions on the amount of foreign exchange instruments, 
currency, or checks which may be brought into the country. Normally, lire 1 
million may be taken out of the country, but any amount declared  on entry 
may be reexported. 
 
Italian exchange regulations are issued by the Italian Exchange Office 
(Ufficio Italiano dei Cambi--UIC), Via Quattro Fontane 123, Rome 00184, 
under authority of the Ministry of Foreign Trade. Foreign exchange may be 
sold or acquired from the Bank of Italy or any of the banks authorized by 
the Bank of Italy. In practice, all commercial banks are authorized to 
conduct foreign exchange transactions. 
 
Dollar currency, travelers checks, and, in some cases, personal checks, may 
be exchanged at banks, exchange offices, and authorized tourist offices and 
hotels. Major credit cards are accepted with proper identification. It is 
best to first confirm what form of payment is accepted. 
 
Quotations and Terms of Payments 
When providing the Italian buyer with a price quote, American firms most 
frequently provide a quote that includes packing costs, insurance, and 
 
 
freight. This is called the c.i.f. price. The average Italian business 
representative can then usually determine the charges for customs, taxes, 
and local transportation to arrive at the final landed cost to importer. The 
customary terms of sale in Italy are either cash or net. Sales made on cash 
terms call for payment before delivery, on delivery, or shortly after 
delivery -- usually within 10 days from the date of delivery. A 2 to 5 
percent discount is made for payment of the full amount of the transaction 
at the end of the specified period from 1 to 4 months from the date of the 
invoice. The length of the period depends on the commodity involved, the 
credit standing of the buyer, and the motivation of the seller. A period of 
up to 2 years is often allowed for payment of capital goods, store 
equipment, trucks, and similar heavy equipment. 
 
Italian firms indicate that some American suppliers are too rigid in their 
payment terms and have thus lost business to other suppliers because of 
their rigidity. Financing is considered as much a competitive factor as the 
product itself, the delivery date, or after-sales service. 
 
While some U.S. manufacturers request payment upon receipt of the goods, 
more successful sellers are offering terms allowing settlement of the 
account from 60 to 120 days following receipt of the order. 
 
The use of irrevocable letters of credit for the Italian market has declined 
appreciably in recent years. Although such instruments are still required by 
American exporters, especially when the Italian customer's credit reputation 
is not well known, the growing reluctance of Italian firms to provide 
letters of credit has required American exporters to utilize other methods 
to assure payment or lose the sale to other suppliers in the competitive 
Italian market. The Italian businessperson is reluctant to pay a high fee 
for a letter of credit when other suppliers or means of payment are 
available. American firms have put to greater use the export credit 
insurance and guarantee programs available through the Foreign Credit 
Insurance Association (FCIA). 
 
Information on specific Italian firms is available from the U.S. Department 
of Commerce through its World Traders Data Reports Service. American banks 
also provide credit information service as well as private agencies. 
 
Just as the terms of any sales offer should be presented in a clear and 
detailed manner, shipments should conform to the contract and to any samples 
which may have been sent to the Italian importer. Special attention should 
be given to the prompt observance of agreed delivery schedules, as prompt 
delivery may be a decisive and possibly an overriding consideration of the 
importer in placing additional orders. When shipping on letter of credit, 
all terms specified on the letter of credit must be strictly observed.  If 
the terms are no followed, the letter of credit may not be honored by the 
bank. 
 
Installment Sales and Requirements 
Selling on the installment plan was first introduced in Italy in the field 
of capital goods, and it has played an important role in the industrial 
development of the country. The payment term usually granted in sales of 
manufacturing equipment ranges from 180 days to 5 years, with the buyer 
making an initial cash payment and then settling the balance in monthly, 
quarterly, or semiannual installments. Sales contracts on installment credit 
for machinery usually provide for a lien against the merchandise on behalf 
of the seller. As a general rule, the lien is established in favor of a bank 
which, in turn, makes the funds available to pay the seller. 
 
Installment sales credit is extended in the great majority of cases by 
 
 
domestic or foreign firms already established in Italy or elsewhere in the 
EC. Italian importers should be advised to check with the Italian Foreign 
Exchange Office (Ufficio Italiano dei Cambi) on installment sales and 
transactions exceeding 20 million lire. Banks, or other financial 
institutions, must file a Foreign exchange statistical return (Comunicazione 
valutaria statistica) on transactions exceeding 20 million lire. 
 
If settlement takes place more than 12 months after importation, importers 
must choose an authorized bank as their bank of domicile through which they 
must carry out all payment operations. Deferred payments for imports are 
permitted freely if settlement is to take place within  5 years after 
importation. 
 
For all authorized imports, the authorized banks provide exchange or permit 
payment in Italian lire to a foreign account, provided that the appropriate 
payment terms are observed. 
 
Installment sales credits are extended, in the majority of cases, by 
domestic or foreign firms operating in Italy. However, in these instances 
the buyer bears the foreign exchange risk. Italian firms also make financing 
arrangements with the Export-Import Bank of the United States. Financing 
through the Eximbank carries no exchange risk. 
 
Installment sales also are very common in Italy in the field of durable 
consumer goods. They account for some 35 to 50 percent of all domestic sales 
of consumer durable such as television sets, refrigerators, and washing 
machines. 
 
The financing of installment credit in connection with sales of consumer 
goods is accomplished by the local banks through the discounting of bills of 
exchange submitted by manufacturers or distributors established in Italy. 
The bills of exchange commonly known as carta rataele (installment paper) 
are signed by the buyers of the goods. Normal credit terms at the trade and 
consumer levels is 30 days, occasionally extending to 60 days. At the retail 
level, most outlets, except grocery stores, offer their customers credit, 
usually 30 days. Credit card sales are as popular in Italy as they are in 
the United States, and consumers are purchasing a wider variety of products 
with credit cards. 
 
Competition has required the use of liberal financing terms to the buyer as 
opposed to requiring payment on a letter of credit or cash basis. Letters of 
credit can be used initially for new accounts, with more liberal terms 
granted if justified by volume and customer reliability. Knowledge of 
industry practice and the customer is generally the prime consideration in 
deciding whether to use sight drafts, time drafts, or open accounts. Usual 
terms of sale are payment within 30 to 90 days after delivery, varying with 
the commodity and the credit standing of the purchaser. American banks can 
advise on using letters of credit as well as on short-term credit financing 
terms. Credit financing may include overdraft facilities, term loans, 
discounting, factoring, and exchange insurance. 
 
Obtaining Credit Information 
In addition to the World Traders Data Reports (WTDR) service provided by the 
Commerce Department to examine the reliability of a foreign firm, background 
information on Italian firms can also be obtained from the following sources: 
 
  Foreign Credit Interchange Bureau, National Association of Credit 
Management, 475 Park Avenue South, New York, NY 10003. 
 
  Dun and Bradstreet, Inc., 99 Church Street, New York, NY 10007. 
 
 
 
  Gradon America, 71 West 23rd Street, Suite 1629, New York, NY 10010. 
 
  Owens Online, 11701 Belcher Road South, Suite #111, Largo, FL 34643-5116 
 
  Major banks--contact the international section of any large city bank for 
assistance. 
 
  The American Bureau of Collections, Inc., 1100 Main Street, Buffalo, NY 
14209-2356 (a collection bureau with an overseas network). 
 
 
Export Financing Programs 
Several programs exist to help finance exports. The following export 
financing programs may be of interest to a U.S. exporter: 
 
  The Small Business Administration (SBA) provides financing for the 
establishment, operation, or expansion of a small business, including firms 
engaged in exporting. the SBA's Export Revolving Line of Credit Guarantee 
Program provides pre-export financing for sales and for foreign market 
development. SBA also has a program in cooperation with the Export-Import 
Bank of the United States  to participate in loans to small firms. 
 
  The Export-Import Bank of the United States (Exim-bank) is an independent 
U.S. Government agency that helps to finance the sale of U.S. goods and 
services to foreign buyers. Eximbank can provide loans directly to foreign 
buyers, provide U.S. suppliers and their banks with credit risk protection, 
or originate direct financing. Eximbank has regional offices located in New 
York, Chicago, Houston, Miami, and Los Angeles. 
 
  The Foreign Credit Insurance Association (FCIA) is a private sector 
association of insurance companies. The FCIA acts in conjunction with, and 
as an agent for, Eximbank to cover export sale repayment losses due to 
political or commercial causes. 
 
  The Overseas Private Investment Corporation (OPIC) assists U.S. private 
investment to promote  the economic and social progress of developing 
countries. Programs include political risk insurance, special insurance 
coverage for natural resource projects, leasing, and contractor's risks. 
 
  The International Bank for Reconstruction and Development (IBRD), under 
the World Bank Group, promotes development of member countries mainly by 
extending conventional loans for specific high-priority projects. 
 
 
 
TRADE REGULATIONS 
 
Membership in the EC 
Italy has been a member of the European Community (EC) since its inception 
in 1958. The other EC members are Belgium, Denmark, France, Germany, Greece, 
Ireland, Luxembourg, the Netherlands, Portugal, Spain, and the United 
Kingdom. Other countries have applied for membership. 
 
The EC forms a customs union and a large unified market having free trade 
among the member states. It levies a common tariff on imported products 
coming from non-EC countries such as the United States, Japan, and Canada. 
The EC also has a common agricultural policy, joint transportation policy, 
and free movement of goods and capital within the member states. Other 
aspects of commercial activity are being harmonized. 
 
 
 
The EC grants tariff preferences to more than 100 developing countries and 
about 40 overseas territories under the EC's Generalized System of 
Preferences (GSP). Imports of nearly all semimanufactured and manufactured 
goods originating in these countries and territories enter the Community 
duty free. Annual duty-free quotas are established for those products, and a 
system of providing  certificates of origin has been established to ensure 
that goods are not diverted through the GSP countries to take advantage of 
the lower tariff concessions. 
 
Free trade agreements have been developed between the European Community and 
the European Free Trade Association (EFTA), which includes Finland, Austria, 
Norway, Iceland, Lechitenstein, Sweden, and Switzerland. Under the terms of 
these agreements, most industrial products and certain processed 
agricultural products are exempt from import duties if traded within this 
trading bloc of 19 nations. The result of the agreements reached between the 
12 EC members and the 7 EFTA members is an open trading area for most 
industrial products of 19 nations with an affluent population of 380 million. 
 
While customs duty rates are the same for all 12 EC countries, the 
value-added tax (VAT) and excise tax on products and services usually differ 
from country to country. These taxes are levied in the country of final 
destination. See the "Value-Added Tax" section for the Italian rates. 
 
Import Duties 
Italy applies the EC tariffs (customs duties), which are based on the 
international Harmonized System (HS) of product classification. Duty rates 
on manufactured goods from the United States generally range from 5 to 8 
percent and are normally levied on the c.i.f. value of the goods at the port 
of entry. The c.i.f. value is the price of the goods (usually the sales 
price) plus packing costs, insurance, and freight charges to the port of 
entry. Most raw materials enter duty free or at low rates while agricultural 
products face higher rates and special levies. For information on EC duty 
rates levied on agricultural products, contact the U.S. Department of 
Agriculture, (202) 447-2144. For information on EC duty rates of 
manufactured and industrial products, contact the U.S. Department of 
Commerce, Office of European Community Affairs, (202) 482-2905. 
 
The Harmonized System is an international system designed to classify goods 
for customs administration and to develop trade statistics. It is arranged 
into 99 chapters. The sections are established according to categories such 
as agriculture, chemicals, chief material of the product, or type of 
manufacturing industry. The chapters and sections start with agricultural 
and primary products followed by products that are more processed and 
technically more complex. 
 
The HS classification number consists of a minimum of six digits, which are 
common to all countries using the Harmonized System. Additional digits can 
be used to meet each nation's individual statistical requirements and give 
greater detail as needed. 
 
If a HS number of the product being shipped is requested by the Italian 
importer, this information may be obtained from any ITA district office or 
from the Office of European Community Affairs, (202) 482-2905. The HS number 
is usually requested by the Italian importer to determine what customs duty 
will be levied at time of importation. The following is a summary of the Harmonized System classification: 
 
On entry, some stamp or administrative taxes may be levied. Italian customs 
officers may assess certain charges (diritti doganali) at the port of entry 
 
 
according to their judgment. The rate of the diritti doganali may vary 
substantially depending on the specific port of entry. 
 
 
                        Summary of Harmonized System 
 
Chapter                 Products Covered 
 1-15   Live animals, animal or vegetable products. 
16-24   Prepared food, beverages, spirits, tobacco. 
25-40   Minerals, chemicals, plastic and rubber articles. 
41-49   Hides, skins, leather goods, wood, pulp, paper. 
50-63   Textiles and textile articles. 
64-67   Footwear, headgear, umbrellas. 
68-70   Stone, plaster, cement articles. 
  71    Precious/semiprecious stones, metals and articles, imitation 
        jewelry, coins. 
72-83   Base metals and articles. 
84-85   Machinery and mechanical appliances, electrical equipment, sound 
        recorders. 
86-89   Vehicles, aircraft, and vessels. 
90-92   Optical, photographic, cinematographic, measuring, checking, 
        medical, clocks and watches, musical instruments. 
  93    Arms and ammunition. 
94-96   Miscellaneous manufactured articles. 
  97    Works of art. 
98-99   Reserved for country use. 
 
 
 
Quotations and Payment Terms 
U.S. sales quotations are usually given on a c.i.f. basis which is the sales 
price plus costs (such as packing), insurance charges, and air or ocean 
freight to point of importation. The c.i.f. quote is generally preferred by 
Italian importers since they are usually familiar with the Italian customs 
charges and value-added taxes levied on the product at the time of 
importation, but may not be acquainted with U.S. costs for trucking, ocean, 
or air freight. Large Italian firms and department stores, however, may 
prefer to buy on other terms when they arrange for the shipping and insuring 
the goods. Quotations and invoicing are usually in terms of the currency of 
selling country. 
 
American quotations, usually stated in dollars and on a c.i.f. basis, are 
completely acceptable to Italian buyers. The usual practice of American 
firms selling to a new customer is to require cash against documents on the 
first sale or two. After establishing credit, the importer will expect to 
pay by 30-, 60-, or 90-day letter of credit. In all cases, the American 
exporter will have to decide how to balance between making the sale with 
liberal financing terms versus more secure payment terms but with less sales 
potential. When first starting out, American firms may often find it 
necessary to offer their best price and payment terms in order to land the 
sale in the competitive international market. Later, prices may be adjusted 
as sales and volume permit. 
 
The Italian buyer may request a quote or shipment of goods under INCOTERMS. 
This is a set of international rules defining the important commercial terms 
and practices. By referencing INCOTERMS in contracts or invoices, both buyer 
and seller will have a uniform understanding of their responsibilities in an 
agreement. Copies of the 90-page publication Guide to INCOTERMS are 
obtainable from ICC Publishing, 156 Fifth Avenue, New York, NY 10010, (212) 
206-1150. Exporters can also obtain information from the Dun & Bradstreet 
 
 
Exporters' Encyclopaedia. 
 
Merchandise may be examined by the Italian importer before customs clearance 
for the purpose of making an inventory. Goods cannot clear customs without 
shipping documents and payment of any required customs duty, applicable 
value-added taxes, and any excise taxes. These formalities must be 
undertaken by the importer at the time of clearing customs. Import licenses, 
if required, should be presented by the importer within the period for which 
they were issued. 
 
Temporary Imports 
Material may temporarily be imported into Italy without payment of duties 
and tax if such material is to be used in the production or manufacture of a 
product that is to be exported. The importer gives security, usually in the 
form of a guarantee from a bank or insurance company, for the amount of the 
usual duties and taxes. Upon exportation of the finished product, the 
guarantee is released or the deposit returned. 
 
Temporary entry of goods intended to be reexported in the same condition is 
permissible free of import duties and taxes upon approval of an application 
by Italian Customs. 
 
Samples without commercial value are admitted free of duty and taxes. 
Samples with commercial value are also admitted duty and tax free, provided 
that the following conditions are complied with: 
 
(a)  The samples are accompanied by a representative of the U.S. firm with a 
statement, notarized by an Italian Consulate, identifying the commercial 
traveler and attesting to the intention that the samples are being imported 
into Italy for the purpose of being shown or demonstrated and they are to be 
reexported in due course. 
 
(b)  A certificate of origin from a recognized chamber of commerce is 
submitted to identify the source of the goods. 
 
 
(c)  A deposit or bond, in the amount of the applicable customs duties and 
taxes, is made at the point of entry. This will be refunded when the goods 
are reexported. 
 
 
(d)  A list (in duplicate) with a full description of each sample, including 
weight and value, is submitted. It is helpful to have such a list in Italian. 
 
U.S. traders should be aware of another and more simplified procedure in the 
form of a carnet for the temporary importation of samples without posting 
guarantees.  See the "Carnets" section on page 25. 
 
In practice, samples valued in excess of lira 1 million (or about $1,250) 
are practically impossible to clear through Italian customs. In such cases, 
it is advisable to engage the services of a local freight forwarder. 
 
Goods in Transit 
Goods may clear customs with an EC transit procedure that provides for the 
issuance of a single transit document under which the goods may be easily 
shipped across frontiers of the EC member states. These transit documents 
are completed for the importer by a freight forwarder in Italy. The EC 
transit document provides the basis for a single, comprehensive procedure 
covering the goods within the Community. Since the single transit document 
is an EC form, the European importer, customs house broker, freight 
 
 
forwarder, or shipper must prepare the document at the point of entry. 
 
Free Trade Zones 
There are two free zones in Italy: one in Trieste and the other in Venice. 
Goods of foreign origin may be brought into the free trade zones without the 
payment of customs duties and taxes. The goods remain free of all such 
charges while held in the zones or if subsequently transshipped or 
reexported. The goods may be freely sold, manipulated, and processed. 
 
Italy also has numerous general warehouses that are located throughout Italy 
in all the port areas and cities. There are no limitations as to the type or 
origin of merchandise that can be stored in free trade zones or bonded or 
customs warehouses. The time limit for such storage is 5 years. Merchandise 
deteriorated while in storage can be destroyed without payment of duty. 
 
The advantage of a free trade zone or bonded warehouse to American firms is 
having a European base of supply to assure customers prompt delivery and 
service. Also being able to maintain inventory at low cost with a minimum of 
customs paperwork is also a distinct advantage. 
 
 
Inward and Outward Processing 
Inward processing is the temporary importation of raw material or products 
for additional manufacture or processing. Merchandise imported for 
additional processing and eventual reexport out of the EC is eligible for 
custom-free treatment. 
 
The reexported goods may be partly or totally processed. The import duty and 
taxes are levied only on those goods that are not reexported and are finally 
sold in the EC. 
 
To qualify for inward processing, an Italian (or EC) firm must satisfy 
customs that it is necessary to use imported goods instead of EC goods; 
state an intention to export products manufactured from the imported goods 
(or equivalent goods available in the EC); and assure that, upon 
reexportation, the conditions set forth in the authorization are satisfied, 
the exported products are accounted for, and the entered goods are 
identifiable and relate to specific importations. 
 
In outward processing, a firm in Italy may export goods for further 
manufacture or processing from the EC customs area and then reimport the 
final product. Duties and taxes are levied only on the increased value added 
by the expatriate manufacturing or processing when the goods are returned to 
Italy and not to the total value of the product. Only firms located in Italy 
or another EC country are eligible to take advantage of this option, and 
they should first gain approval of the Customs authorities. 
 
 
Samples and Advertising Materials 
Italy participates in the International Convention to Facilitate the 
Importation of Commercial Samples and Advertising Materials. Samples of 
negligible value imported to promote sales are accorded duty-free and 
tax-free treatment. Prior authorization is not required. To determine 
whether the samples are of negligible value, their value is compared with a 
commercial shipment of the same product. Granting of duty-free status may 
require that the samples be rendered useless for future sale by marking, 
perforating, cutting, or other means. 
 
Imported samples of commercial value may be granted a temporary entry and 
exemption from custom charges. However, a bond or cash deposit may be 
 
 
required as security that the goods will be removed from the country. This 
security is the duty and tax normally levied plus 10 percent. Samples may 
remain in the country for up to 1 year. They are not permitted to be sold, 
put to their normal use (except for demonstration purposes), or utilized in 
any manner for remuneration. Goods imported as samples may be imported only 
in quantities constituting a sample according to normal commercial usage. 
 
 
Carnets 
As a result of various customs agreements, simplified procedures are 
available to U.S. business and professional people for the temporary 
importation of commercial samples and professional equipment. A carnet is a 
customs document that facilitates customs clearance for temporary imports of 
samples or equipment. With the carnet, goods may be imported without the 
payment of duty, tax, or additional security. The carnet also usually saves 
time since formalities are all arranged before leaving the United States. A 
carnet is usually valid for 1 year from the date of issuance and is issued 
at moderate cost. A bond or cash deposit of 40 percent of the value of the 
goods covered by the carnet is also required. This will be forfeited in the 
event the products are not reexported and duties and taxes are not paid. 
 
Carnets are sold in the United States by the U.S. Council for International 
Business at the following locations: 1212 Avenue of the Americas, New York, 
NY 10036, (212) 354-4480; 3345 Wilshire Boulevard, Los Angeles, CA 90010, 
(213) 386-0767; and 1930 Thoreau Drive, #101, Schaumburg, IL 60173. 
 
 
Advance Rulings from Italian Customs 
Prior to signing a long-term contract or sending a shipment of considerable 
value, it may be prudent for a U.S. exporter or the Italian importer to 
first obtain an official ruling on the customs classification, duty rate, 
and taxes that will be applied on the shippment. Such requests should be 
sent to Dipartimennto della Dogana, Via vie delle Provincie 103, 00162 Rome. 
The request should describe the product, the material it is made from, and 
other details needed by customs authorities to classify the product 
correctly. While customs will not provide a binding decision, the advance 
ruling usually will be accepted if the imported goods are found to 
correspond exactly to the full description provided when requsting the 
ruling. 
 
 
Value-Added Tax 
The value-added tax, most frequently called by its acronym VAT, is charged 
on the sale of goods and services within the country.  In Italian this is 
called l'imposta sul valore aggiunto (IVA).  Unlike the customs duty, which 
is the same for all EC member countries, the VAT rates are established by 
the tax authorities of each country and differs from country to country. At 
each stage of the manufacturing and distribution chain, the seller adds the 
appropriate amount of VAT (tax on the amount of value that the seller added 
to the product, plus the amount of VAT passed on to the seller by the 
supplier) to the sales price. The tax is always quoted separately on the 
invoice. In submitting the revenue to the government, each firm periodically 
subtracts the VAT it paid when making purchases of goods and services from 
the amount of VAT collected on sales.  The balance is remitted to the 
government. This process repeats itself at each stage until the product is 
sold to the final consumer who bears the full burden of the tax. The box at 
the right contains a summary of the VAT rates in Italy. 
 
                               Value-Added Tax 
 
 
 
Exempt Rate--Products exported from Italy are exempted from the value-added 
tax. 
 
Preferential Rate--4 percent rate applies mainly to such necessities of life 
as basic foods, medicines, and transportation. Examples of such goods 
include: fish (fresh or frozen), fresh milk and milk products, fruit, 
vegetables, wheat, corn, rice, vegetable oil, margarine, fertilizers, 
finished goods used in urbanization projects (such as water treatment, 
trasportation, electrical generation, and construction), medical instruments 
(orthopedic, dental, and optical), newspapers, magazines, and periodicals. 
 
Reduced Rate--9 percent rate applies to foods that are more processed such 
as coffee, cocoa, spices, malt, yogurt and fermented milk products, 
hydrogentated vegetable oil, processed cereal products, frozen fruit, soups, 
condiments, mineral water, beer, wine, wine vinegar, wood, gas and electricy 
for domestic and industrial use, scientific instruments, primary and 
semi-finished construction materials (cement, prefabricated materials, floor 
coverings), restaurant service and hotel accommodations, and private 
telephone service. 
 
Standard Rate--19 percent rate is the general or standard rate and applies 
to the majority of goods and services. Examples include such goods as beef 
and pork (fresh or frozen), fruit juice, liquor, natural gas and petroleum 
products, chemicals and plastics, metals, machinery and machine parts, 
office machines, furniture. 
 
Luxury Rate--38 percent rate is applied on luxury items such as perfumes, 
jewelry, cameras, stereos, furs, sparking wines,  automobiles with engines 
larger than 2,000 cubic centimeters, and motorcycles with engines over 350 
cubic centimeters. 
 
For imports into Italy, the VAT is levied at the same rate as for domestic 
products or transactions. The base on which the VAT is charged on imports is 
the c.i.f. value of the goods at the point of entry, plus any duty, excise 
taxes, levies, or other charges (excluding the VAT) collected by customs at 
the time of importation. This total represents the transaction value of the 
import when it clears customs. The Italian importer is liable for customs 
duties, VAT, and any other charges at the time of clearing the goods through 
customs. Exports from Italy are exempt from VAT since they are not consumed 
in the country and will be subject to taxes imposed in the country of 
destination. Temporary imports that are reexported are not subject to the 
VAT. The importer may have to post a temporary bond for the amount of 
customs duty and taxes as security until  the goods are taken out of the 
country. 
 
The EC is seeking to harmonize the range of VAT rates among the 12 EC member 
nations. The EC Council has adopted guidelines for converging the VAT rates 
over an extended transitional period such as seeking to establish a minimum 
VAT rate for most products, lifting border tax controls, and defining which 
products will be allowed an exempted or zero VAT rate. Each country will 
still retain the collection and enforcement authority that currently exists. 
 
The VAT is applied on the c.i.f. value plus the duty charged on the product. 
Important exempted services and items include the transfer of shares and 
bank bonds, transfer of businesses and of land, commissions paid on 
 
goods exported, the forwarding of goods abroad, property rental, banking and 
financial transactions, as well as insurance. The VAT is applied on 
domestically produced goods as well as imports. The difference is either 
paid to the government, or, in the case of a balance in favor of the seller, 
 
 
the amount can be carried forward and offset against future amounts payable. 
The ultimate consumer bears the full burden of the tax. Any person, Italian 
or foreigner, that is engaged in a commercial or financial transaction that 
produces an income in Italy or invests in real estate, stock market, or 
other such venture, must obtain a fiscal code (codice fiscale) registration 
number for tax purposes. 
 
Excise Taxes 
Excise taxes (l'imposta sui consumi) are levied on a small number of 
products such as soft drinks, wine, beer, spirits, tobacco, sugar, and 
petroleum products. For imports, the excise tax is paid by the importer and 
is in addition to any customs duty or VAT. The EC plans to harmonize excise 
taxes and create the single internal market. 
 
Shipping Documents 
Documents required for exporting include the usual shipper's commercial 
invoice and the bill of lading or air waybill, none of which require 
consular legalization. For textiles and apparel, it is good practice to 
provide a certificate of origin, available through most state chambers of 
commerce. For other products, however, if substantive proof of U.S. origin 
is provided through other accompanying documents as well as through 
characteristic trademarks, a certificate of origin is not normally necessary. 
 
Shipments to Italy require one copy each of the bill of lading (or air 
waybill) and the commercial invoice for customs clearance. There are no 
consular requirements, but certificates of origin may be required as set out 
below. 
 
U.S. Customs also requires two copies of the U.S. Shipper's Export 
Declaration (U.S. Department of Commerce Form 7525V) for goods valued at 
$1,500 or more. A declaration form must be completed for all shipments by 
regular mail or parcel post valued at $500 or more. The form must include 
the harmonized commodity number of the exported product as well as the 
weight stated in metric units. When sending goods through the mail, the 
exporter should inquire at the post office as to the proper documentation 
needed for mail shipments. For additional information or assistance on 
export documentation, readers should consult publications such as the 
Exporters' Encyclopaedia, published by Dun's Marketing Services or contact a 
local U.S. Department of Commerce International Trade Administration 
district office. 
 
Although no special format is prescribed for the commercial invoice, it is 
advisable to include the following: date and place of shipment; name (firm's 
name) and address of the seller and buyer; method of shipment; number, 
markings of the packages, and their numerical order; description of the 
goods using the usual commercial description according to kind, quality, 
grade, and the weight (gross and net, in metric units), along with any 
factors increasing or decreasing the value; agreed price of goods; unit 
cost; total cost f.o.b. factory plus shipping; insurance charges; delivery 
and payment terms; and the signature of a responsible official of the 
shipper's firm. Bills of lading should bear the name of the party to be 
notified. The consignee needs the original bill of lading to take possession 
of the goods. 
 
Certificates of origin are required for a small number of goods such as 
textile products. The need for a certificate of origin should be ascertained 
directly from the importer or from the appropriate customs authority. Letter 
of credit terms may stipulate that a certificate of origin be provided. 
Customs authorities accept certificates of origin issued by authorized local 
U.S. chambers of commerce or boards of trade. 
 
 
 
Marking and Labeling 
There is no general requirement that imports be marked as to country of 
origin. Under Italian legislation, the origin of imported merchandise is 
established through documentation accompanying the shipments arriving in 
Italy and not through marking of products or their containers. Certain 
specified commodities, however, must be marked or labeled to show 
composition, and name and location of manufacturer, in accordance with 
various laws and regulations. 
 
The following articles are subject to special marking or labeling 
regulations:  lime, cement and similar binding agents; pianos, automatic 
pianos, harmonicas and similar instruments; clinical thermometers; ethical 
medicines; cosmetics; packaged foods; distilled spirits; beer; wine; 
vinegar; and feedstuffs. 
 
Hallmarking of gold and silver articles is required before they can be 
offered for sale. Only small tolerances are allowable for manufacturing 
errors. The hallmarking may be done by a hallmarking office after 
importation. 
 
Imports of certain commodities, including numerous foodstuffs, are subject 
to special regulations regarding the manner in which they must be labeled to 
show manufacturer, composition, content (in metric units), and country of 
origin. In view of the complexity of these regulations and changing 
requirements, information should be requested from the importer prior to 
shipment. When the services of an importer are not available, information 
can be obtained directly from the appropriate Italian Government authority 
listed at the end of this publication. For agricultural and food products, 
the U.S. exporter should contact the U.S. Department of Agriculture for 
marketing and labeling information and exporting assistance. 
 
Import Licensing 
With exception of a small group of largely agricultural items, practically 
all goods originating in the United States and most other free-world 
countries can be imported without import licenses and free of quantitative 
restrictions. There are, however, monitoring measures applied to imports of 
certain sensitive products. The most important of these measures is the 
automatic import license for textiles. This license is granted to Italian 
importers when they provide the requisite forms. 
 
Various apparel and textile products, and controlled items such as arms and 
munitions are the most frequently regulated items. Import licenses are 
generally rapidly granted for goods of U.S. origin and delays are usually 
from lack of proper documentation or information. 
 
Licenses are not transferable. They may be used to cover several shipments 
within the total quantity authorized. In general, the goods involved are 
indicated on the license by the Harmonized System classification number and 
the corresponding wording of the tariff position. 
 
Technical Standards 
The metric system is the key measurement system in international trade, with 
the United States being the only major nation where this system is not in 
full use. The 1988 Trade Act states that the metric system is the preferred 
system for weights and measures. American firms can be at a serious 
disadvantage in world markets since overseas buyers are reluctant to accept 
nonstandard (nonmetric) products since replacement parts and tools are less 
available and serious safety risks could result by mixing metric and 
nonmetric parts. 
 
 
 
As a member of the EC, Italy applies the product standards and certification 
approval process developed by the European Community. Italy is required by 
the Treaty of Rome to incorporate approved EC directives into its national 
laws. There is frequently a long lag by the various EC members on obtaining 
national implementation. 
 
With the development of a single harmonized EC product standard, U.S. 
exporters may find that it is usually much easier to comply with one EC-wide 
standard rather than having to meet several individual national standards 
when exporting to Europe. 
 
There are numerous mandatory and voluntary standards in existence that 
define products, processes, or procedures and embrace many fields. The texts 
of these standards may be obtained directly from UNI, Ente Nazionale 
Italiano di Unificazione, Piazza Diaz 2, 20123 Milan (Italian National 
Bureau of Standards) or through the American National Standards Institute, 
1430 Broadway, New York, NY 10018, (212) 354-3300. 
 
European Community Certification 
As part of the unification program to establish common standards for all 12 
member countries, key product areas will be regulated by the Community. 
Mandatory requirements to protect the health and safety of consumers, as 
well as the environment are constantly being developed and implemented. To 
indicate conformance to the mandatory EC requirements, a CE mark must be 
placed on all regulated products by the manufacturer or a representative 
before they can be sold on the EC market. The applicable product testing and 
certification requirements for individual product categories are specified 
in the various EC directives. The CE mark relates only to the mandatory 
health, safety, and environmental requirements established by the EC; it 
does not indicate conformity to European product standards. Thus, national 
marks of conformity with product standards remain compatible with the CE 
mark and both may be applied to the product. It should be noted, however, 
that the CE mark does replace all national safety marks for the regulated 
products. 
 
The EC Commission has released The Global Approach to Certification and 
Testing, a document that recommended harmonized testing and certification 
procedures within the Community. These proposals included establishing a 
"modular" system for demonstrating product compliance. Under this system, 
methods of demonstrating product conformity range from having the 
manufacturer self-certify the product to having a private testing company 
type-approve the product and provide market surveillance, depending on the 
probability and type of product risk. As standards and certification 
requirements are important in international trade, it is expected that more 
U.S. testing laboratories will be able to certify that products comply with 
EC requirements. 
 
Assistance on Standards 
U.S. firms exporting to Italy are confronted with both national and EC 
product standards. Further, these regulations occasionally change to meet 
new technology and more stringent demands. Exporters can stay fully informed 
of the latest EC technical standards activities by contacting the Standards 
Information Service of the National Institute of Standards and Technology 
(NIST) at (301) 975-4040. A part of the U.S. Department of Commerce, NIST 
offers industry an in-depth reference system on EC standards information 
gathered from the two European standards bodies tasked to write the EC 
norms--the European Committee for Standards (CEN) and the European Committee 
for Electrotechnical Standardization (CENELEC). 
 
 
 
NIST also can provide updated information from the EC which will elaborate 
on directives and provide assistance in identifying EC and member state 
standards and regulations. For more information, contact NIST at (301) 
975-4038. 
 
Also, the Single Internal Market Service, International Trade 
Administration, Room 3036, U.S. Department of Commerce, Washington, DC 
20230, publishes regular updates on the status of the EC directives. To 
obtain copies of EC directives, amendments, and published updates, or to 
obtain a complete list of EC directives that could affect product sales to 
Italy or to another EC country, call (202) 482-5276. Copies of all documents 
are available at a nominal fee. 
 
Other valuable sources of information with regard to foreign standards 
include the American National Standards Institute, 1430 Broadway, New York, 
NY 10018, (212) 354-3300, the Department of Commerce's National Technical 
Information Service, Springfield, VA 22161, (703) 557-4733, as well as 
various trade associations that follow international activities for their 
membership. 
 
 
Electric Current 
Electrical power supplies are generally 220 volts, 50 cycles, single-phase 
and 380 volts, 50 cycles, three-phase. Also, usually available are 127 
volts, 50 cycles, three-phase. Electricity at 60 cycles is not available. 
American appliances, such as electric shavers or hair dryers, do not work 
and will be damaged if used without a converter. 
 
Service interruptions are rare and the frequency of the current is stable. 
The electrical plug is the standard plug B. This is a plug that has two 
round pins instead of the flat prongs. Some outlets may require different 
plugs in other parts of the country. 
 
Weights and Measures 
Italy uses the metric system of weights and measures, which is called the 
International System of Units (SI). The European Community has established 
standardized packaging units for numerous products, which should be 
consulted by U.S. exporters. Labeling must be in metric units for all 
imported products to be sold in Italy. Products are allowed to be imported 
and then labeled in SI metric units prior to sale. Dual labeling information 
is permitted, but the nonmetric information must not predominate. The U.S. 
exporter would be well advised to first check with the Italian importer to 
ensure that the package size and labeling complies with all requirements 
prior to shipment. 
 
Metric measurements should be used in every quotation where size or weight 
is involved. The Italian buyer will expect products and literature to be 
labeled in metric units. Detailed information on the European Community's 
metric and packaging requirements may be obtained from: Office of European 
Community Affairs, Room 3036, U.S. Department of Commerce, Washington, DC 
20230, (202) 482-2905. 
 
U.S. Export Controls 
For the purpose of national security, foreign policy, or the short supply of 
materials, the United States controls the export of goods and technology by 
two broad categories of export licenses--general and validated. 
 
The vast majority of U.S. exports are shipped abroad under general licenses 
that do not require formal application or approval. To determine which kind 
of export license is required, exporters should consult the U.S. Export 
 
 
Administration Regulations for complete details or obtain assistance from 
the local U.S. Department of Commerce district office. 
 
As an overview, the first step in the export licensing process is to 
determine whether a product requires a general or validated license. 
Determine what is being exported, the destination of the product, its 
end-use, and the organization that will be using the product. Check the 
schedule of Country Groups listed in the U.S. Export Administration 
Regulations to determine the destination category; check the Commodity 
Control List to determine if the product requires a validated license for 
shipment to that particular country; and determine if any special 
restrictions are in effect. 
 
If the product is not on the control list, then it can be exported under a 
general license. The U.S. exporter simply completes the U.S. Shippers Export 
Declaration, Form 7525-V, providing details of the shipment; includes a 
commercial invoice; and exports the goods. If the product is on the control 
list, a validated license is needed. An application must be made and an 
export license granted. As a general rule, an exporter will need a validated 
license (1) if the products are controlled or in short supply regardless of 
the country of destination; (2) for any commodity to a destination with 
foreign policy concerns; or (3) for unpublished technical data to certain 
destinations. Certain special licenses are also issued to cover large 
projects or repeated sales through a foreign distributor. 
 
For assistance in determining what type of license is needed and to initiate 
the processing of an application, contact your local Department of Commerce 
district office or the Bureau of Export Administration, Office of Export 
Assistance, Room H-1099D, U.S. Department of Commerce, Washington, DC 20230, 
(202) 482-4811. 
 
Intellectual Property Rights Protection 
Italy is a member of the Paris Union International Convention for the 
Protection of Industrial Property (patents and trademarks) to which the 
United States and about 85 other countries adhere. U.S. citizens are 
entitled to the same treatment (national treatment) in acquiring and 
maintaining patent and trademark protection in Italy as an Italian citizen 
would be. In addition, after filing a patent application in the United 
States, a U.S. citizen is entitled to a 12-month period within which to file 
a corresponding application in Italy and receive in Italy the benefit of his 
or her first U.S. filing date (rights of priority). The priority right 
filing period for trademarks is 6 months. 
 
Italy is also a member of the Berne Copyright Union and adheres to the 
Universal Copyright Convention to which the United States and 50 other 
countries are signatories. U.S. authors can thereby obtain copyright 
protection in Italy for their work first copyrighted in the United States 
merely by placing on the work, their name, date of first publication, and 
the symbol  . In turn, Italian authors have the same rights in the United 
States for works first copyrighted in Italy. 
 
Patent and trademark applications and inquiries should be addressed to: 
 
Ministero dell'Industria e Commercio 
Ufficio Centrale Brevetti per Invenzioni 
Modelli e Marchi 
Via Molise, 19 
00187 Rome, Italy 
 
Applications and inquires concerning copyrights should be addressed to: 
 
 
 
Presidenza del Consiglio dei Ministri 
Ufficio del Proprieta Letteraria, Artistica e 
Scientificia 
Via Boncompagni, 15 
00187 Rome, Italy 
 
Laws Governing Intellectual Property Rights 
Patents and Licensing--The principal laws governing patent protection are 
Royal Decrees No. 3731 of October 30, 1859, No. 1127 of June 29, 1939, Law 
No. 633 of April 22, 1941, and Presidential Decree No. 338 of June 19, 1979. 
Decree 338 amends the former Italian legislation and implements the European 
Patent Convention. To be patentable, an invention must be novel, that is, it 
cannot have been available to the public anywhere else before the date of 
the filing or of the priority claimed. 
 
Patents are granted for 15 years from the effective filing date of 
application. They are assignable and transferable. A patent can be subject 
to compulsory licensing if not worked within 3 years from date of grant or 4 
years from the filing date of application, whichever is later. 
 
Licensing and technical assistance agreements with foreign firms are 
encouraged by the government. The foreign exchange necessary to effect 
payment abroad (including the United States) of bona fide royalties and/or 
technical assistance fees can be obtained simply upon application to the 
Italian Exchange Office through a bank. Applicants are required to produce 
the original contract with the foreign concern and to submit a certified 
copy of such a contract. A certificate confirming the validity of the patent 
should also be submitted in the event that the contract provides for the use 
of patents. 
 
Annual taxes must be paid each year during the period an Italian patent is 
in force. These taxes are progressive and range from lire 1,000 for the 
first year to lire 35,000 for the 15th year. 
 
 
Trademarks--The principal trademark registration laws are Royal Decree No. 
929 of June 21, 1942, and Presidential Decree No. 795 of May 8, 1948. Some 
types of terms are not registrable as trademarks, such as those deemed to be 
generic, those containing false indications of quality or origin of goods, 
and those similar terms already registered by others in Italy or for which 
applications are pending. For some goods, geographic names may not be used 
in trademarks nor can the portraits of persons be registered without their 
consent. 
 
Trademark applications are examined for acceptability of their format and 
consistency with the laws. If an application is in order, the mark will be 
registered. There is no opportunity for opposition and the first applicant 
is entitled to registration. However, any other person who claims to be the 
first user of the mark in Italy can have the prior registration cancelled, 
provided one can prove the claim. No claim of prior use can be made after 
the registered mark is 5 years old. 
 
Trademarks are registered for 20 years from the effective application filing 
date and are renewable for similar periods. Failure to use a mark within 3 
years after its registration can result in cancellation. Trademarks may be 
assigned to other users provided such action does not involve deceptive 
trade practices. 
 
For administrative purposes, trademark products are classified under 42 
 
 
groups (1-34 for products and 35-42 for services). Applications must 
indicate the appropriate classification. 
 
Copyrights--Both Italy and the United States are signatories of the 
Universal Copyright Convention, which provides for mutual copyright 
protection. In Italy, copyrights are protected by Law No. 633 of April 22, 
1941 and Decree Law No. 82 of August 23, 1946. Executive recognition in the 
form of copyright protection to the author is accorded intellectual 
creations pertaining to science, literature, music, decorative arts, 
architecture, the theater, and motion pictures. Copyright protection for an 
author's work exists for the life of the author, plus 50 years after his or 
her death. In the case of motion pictures, protection is limited to 30 years 
from the date of the first public screening. Anonymous works are protected 
for 50 years after publication. Further detailed information on procedures 
regarding patent, trademark, and copyright protection in Italy should be 
obtained from competent legal counsel. 
 
European Patent Convention 
Italy is also a signatory to the European Patent Convention, which provides 
for a centralized European-wide patent protection system. The European 
Patents Act of 1977 provides increased legal protection, a patents court, 
and guidelines for compensation of an inventor. 
 
The European Patent Convention has simplified the process for obtaining 
patent protection in the EC member states. Under the European Convention, an 
applicant for a patent is granted a preexamined 15-year, non-renewable 
European patent that has the effect of a national patent in all 16 countries 
that are signatories of the convention, based on a single application to the 
European Patent Office. This procedure should expedite the granting of 
patents. However, infringement proceedings remain within the jurisdiction of 
the national courts, which could result in some divergent interpretations. 
Further information may be obtained from the European Patent Office, 
Motorama-Haus, Rosenheimer Strasse 30, Munich, Germany. 
 
 
INVESTMENT 
 
Investment Climate 
Italy's general policy toward foreign investment has been consistently 
favorable, motivated by the policy that foreign investment contributes to 
domestic economic growth, employment, and the level of industrial technology. 
 
Foreign investment in Italy is governed by Law No. 43 and subsequent 
implementing regulations. The law guarantees repatriation of foreign capital 
originally invested in new productive enterprises in Italy and unlimited 
remittance of profits. Foreign direct investment transactions are also 
covered by Italian exchange control procedures. Although both capital and 
earnings are free of restrictions, strict enforcement of exchange controls 
sometimes causes delays in certain transfers of funds. 
 
With only few exceptions, Italy does not limit the extent of foreign 
ownership in an Italian corporation or other business entity. The Italian 
Government's stance on inward foreign investment is to provide national 
treatment, that is, nondiscrimination either in favor or against foreign 
investment. There are numerous bureaucratic obstacles to investing in Itlay, 
but these problems apply to both Italian and foreign firms.  Several areas 
that are controlled by the state are excluded from Italian and foreign 
private participation. These include areas such as the manufacture and sale 
of tobacco and matches, and operation of railroads. 
 
 
 
According to the Bank of Italy, the stock of total foreign direct invstment 
in Italy at the end of 1991 was $59.7 billion (see Table 4). Switzerland is 
the largest foreign direct investor in Italy ($14.1 billion), followed by 
France ($8.3 billion) and the United States ($8.2 billion).  Using Bank of 
Italy statistics, U.S. direct investment accounted for 13.7 percent of total 
foreign direct investment. 
 
Major industrial investment proposals are required to be submitted to CIPE 
(Interministerial Committee for Economic Planning) to verify that the 
proposed investments conform to the objectives in the economic plan. Job 
creation and balanced economic development are the primary objectives of the 
economic plan. 
 
Licenses are required for numerous activities, including the manufacture of 
pharmaceutical chemicals, patent medicines, infant foods, meat preparations, 
explosives, firearms, ammunition, radio and TV sets, and electronic tubes. 
Trading firms wishing to import or export goods subject to licensing 
procedures must be registered with the Ministry of Foreign Trade. Any 
organization in Italy dealing in retailing or wholesaling, including 
mail-order and vending machines sales, must obtain a license from national 
and local authorities. 
 
Investment Incentives 
Investment incentives range from nonfinancial aspects to specific and 
detailed tax breaks. These incentives are provided on a case-by-case basis 
and should be discussed with the Italian authorities involved in plant 
location. Financial incentives may include a reduced tax rate to free grants 
to assist in employee training, as well as capital loans. Low-cost 
facilities (industrial estates) are immediately available for rent or sale. 
The incentives are most favorable for the depressed area of the Mezzogiorno. 
Incentives for the Mezzogiorno are established by Law No. 64, March 1, 1986, 
which provides for a 10-year exemption from the corporate and local taxes. 
 
The agency in the United States to assist American firms in this matter is 
the Italian Trade Commission, 499 Park Avenue, New York, NY 10022, (212) 
980-1500. 
 
 
                 Table  4 Foreign Direct Investment in Italy 
                (Year-end 1988 to 1991, millions of dollars) 
 
Country                       1988     1989      1990       1991 
United States                5,397.0  7,392.1   8,277.0    8,179.4 
European Community          19,898.1 26,193.7  29,088.5   30,785.4 
 of which: 
 France                      4,059.8  5,241.7   7,685.0    8,685.0 
 Netherlands                 4,354.8  6,199.2   6,390.3    6,566.5 
 United Kingdom              3,965.5  5,911.8   6,296.5    6,318.9 
 Germany (United)            3,331.0  4,344.1   4,634.5    4,552.6 
 Luxembourg                  3,496.1  3,322.8   3,063.7    3,982.6 
 Spain                          49.8     91.3      92.9      183.3 
 Other EC                      731.1  1,082.8     925.6      920.0 
Switzerland                  7,433.0 10,670.1  14,331.9   14,146.0 
Sweden                       1,030.7  1,398.4   1,714.2    1,686.4 
Liechtenstein                  872.8    908.7   1,084.1    1,102.5 
Japan                          307.3    575.6     894.7      924.4 
Argentina                      210.0    247.2     140.7      139.9 
Brazil                          15.3     23.6      29.2       16.5 
All Others                   1,741.5  2,000.9   2,432.6    2,692.8 
Total                       36,905.7 49,410.3  57,992.9   59,673.3 
 
 
 
Source: Bank of Italy 
Entry and Repatriation of Capital 
The Central Bank screens and approves all foreign investment. There are no 
special screening procedures directed solely at foreign investment except in 
some restricted sectors. The 1990 antitrust law does require notification of 
all acquisitions in which the takeover has total sales of over 50 billion 
lire or where the newly merged entity would have combined sales of over 500 
billion lire. 
 
Italy provides national treatment and permits 100 percent ownership except 
in a few instances.  These include petroleum, railroads, electrical 
generation and transmission, and production of cigars and cigarettes.  Italy 
also limits foreign investment in banking, insurance, domestic air 
transport, shipping, and access to local capital markets. 
 
Remittance of dividends and profits and the repatriation of capital must 
also have prior Central Bank approval, but this is mainly a formality. 
Royalty agreements between resident and nonresident companies must be 
approved by the Central Bank. These approvals are routinely granted and 
serve more as a monitoring function than as a method of capital control. 
 
The U.S. Embassy in  Rome has prepared a brief report on Italy's Investment 
Climate.  To obtain a copy of this report, U.S. business representatives 
should consult the National Trade Data Bank or call the Commerce 
Department's Desk Officer for Italy, (202)  482-2177. 
 
Requirements for Business Operation 
A U.S. citizen wishing to establish temporary or permanent residence in 
Italy to administer a business or to manage a corporation should obtain a 
business visa from one of the Italian Consulates in the United States. All 
individuals or firms in business in Italy must be registered with the local 
Chamber of Commerce, Industry and Agriculture. This is a quasi-government 
office, operating essentially as a field office of the Ministry of Industry 
and Commerce. To register with this office, an agent for a foreign company 
must produce a power of attorney duly notarized by an Italian consular or 
diplomatic official in the country of the principal. 
 
Government's Role in Industry 
Although in recent years the Italian Government has begun to implement a 
policy of divestiture of state-owned or state-controlled companies, the 
government still plays an important role in the economy. State agencies have 
a controlling interest in a large number of financial, commercial, and 
industrial enterprises. 
 
State participation in key economic sectors is very extensive, particularly 
in communications and transportation, where telephone, railroads, the 
national airline Alitalia, and large shipping companies are operated by 
government holding companies. Most of the production and distribution of 
electric power is nationalized. 
 
 
Table  5 U.S. Direct Investment in Italy (Year-end 1991) 
Sector                               Millions of  Dollars 
 
Petroleum                                      569 
Manufacturing                                8,730 
Wholesale trade                              2,173 
Banking                                        137 
Finance, insurance, real estate              1,325 
 
 
Services                                       403 
Other industries                               488 
 
Total                                       13,825 
 
Source:  U.S. Department of Commerce, Survey of 
Current Business, June 1992 
 
State participation in the industrial sector ranges from direct management 
to joint ventures in which the government controls the majority of shares. 
State activities spread over a wide range of industrial branches from 
engineering, mining, metallurgy, shipbuilding, automobiles, chemicals, paper 
mills, printing and publishing, and hotels to the largest banks. The state 
is, therefore, an important employer and customer, and its influence is felt 
in both domestic and foreign trade sectors. Most of the 
government-controlled enterprises are affiliates of four giant holding 
companies: IRI (Industrial Reconstruction Institute), EFIM (Manufacturing 
and Financial Holding Agency), and ENI (National Hydrocarbons Agency), all 
of which come under the supervision of the Ministry of State Holdings, and 
of ENEL (Electric Power Agency) under the Ministry of Industry. 
 
The Italian Government actively promotes American and other foreign 
investment. Economic policies are designed to foster a climate conducive to 
business and economic development and to attract foreign investment that 
will expand employment opportunities. 
 
There are no restrictions on foreign ownership of firms nor any threat of 
nationalization. American investors are provided national treatment in all 
respects, including grants and assistance. The government has a 
long-standing policy of attracting business. 
 
U.S. Investment in Italy 
The United States has been the leading foreign investor in Italy for over a 
decade. Approximately 7,500 U.S. firms have subsidiaries, distributors, 
agents, or licensees there. Some 40 percent of U.S. investments are 
estimated to be wholly U.S. owned. According to U.S. Government statistics, 
the book value of direct investment by American companies in Italy was 
$13.8  billion at year-end 1991. 
 
 
Forms of Business Organization 
When setting up an enterprise in Italy, one may choose from several types of 
organizations that are specified in the Italian Civil Code Book V, Title V. 
The business form most widely employed, and usually of greatest interest to 
American executives, are the private limited companies. Other forms of 
business organizations will also be familiar to an American firm seeking to 
establish an exporting office in Italy. Firms interested in starting a sales 
office or other business in Italy should first obtain expert legal and 
accounting advise and make detailed inquiries on the current law and 
commercial requirements. The business forms, with the Italian language 
description, are detailed below. 
 
Individual or Sole Proprietorship (Proprietario)--An individual 
proprietorship established for the production or exchange of goods and 
services is responsible for its operation to the extent of the proprietor's 
business assets and personal property. 
 
Simple Partnership (Societa Semplice)--A partnership is a group of two or 
more persons conducting trade jointly. The simple partnership can be 
established without any particular formalities. The partnership is set up 
 
 
either through the joint operation of a business or by contract. 
 
Each member of the firm is liable for any business debts, unless otherwise 
specified and publicized, to the full extent of his or her personal assets. 
Partners' shares of profits and losses is proportional to contribution of 
capital. 
 
General or Unlimited Partnership (Societa in Nome Collectivo - Snc)--In an 
unlimited partnership, all partners are jointly and severely liable without 
limitation for partnership obligations. An unlimited partnership may not 
issue bonds. The partnership contract must contain the data specified in 
Article 2295 of the Civil Code and be filed in the Register of Enterprises 
at the local court. Any of the partners may be appointed to serve as 
directors. 
 
Limited Partnership (Societa in Accomandita Semplice-Sas)--Liability in a 
limited partnership is joint, several, and unlimited for the general 
partners. Limited partners are liable only to the extent of their original 
capital investment. A limited partnership may not issue bonds. Subscribed 
capital cannot be represented by shares. The articles of partnership, as 
outlined in Article 2295 of the Civil Code, must specify who are the general 
and limited partners. The partnership contract is filed with the Register of 
Enterprises of the local court. Only general partners may participate in the 
management. 
 
Limited Partnership with Shares (Societa in Accomandita per Azioni - 
SapA)--A limited partnership with shares has the same structure as a limited 
partnership, except that holdings of the partners are represented by shares. 
Companies limited by shares may issue bonds, within the limits as provided 
for the joint stock companies in the limited partnership, liability is 
joint, several, and unlimited for general partners, while limited partners 
are liable to the extent of the original capital invested. The company must 
be registered in the Register of Enterprises. Many of the regulations 
governing corporations are applicable to this form of business. 
 
Limited Liability Company Societa a Responsibilita Limitata - Srl)--Owners 
in a limited liability company are not personally liable for company 
obligations beyond their subscription quotas. Unlike a corporation, quotas 
in a limited liability company are not represented by shares of stock. Such 
a company cannot issue bonds. A limited liability company must have minimum 
capital of 20 million lire. The company must draw up a contract according to 
Article 2475, of the Civil Code, and file it with the Register of 
Enterprises. 
 
Cooperative (Societa Cooperative)--Cooperatives and mutual insurance or 
assurance companies may be established to carry out such activities as 
production, marketing, banking, and insurance. Cooperatives are subject to 
various restrictions and to governmental supervision. Each partner may not 
hold more than $400 in shares. The board of directors must approve assigning 
of shares and admission of new members. 
 
Joint Venture (Associazione in Partecipazione)--A joint venture involves the 
participation by supplier of capital in the profits of the business. The 
operator manages the business and is solely responsible for the obligations 
he or she assumes toward third parties. The person furnishing capital is 
responsible for any loss in direct proportion to his or her share in the net 
profit, limited to the amount of his original investment. 
 
Corporation (Societa per Azioni - SpA)--The Italian corporation is similar 
in form to the corporation in the United States and is usually the most 
 
 
suitable form for large enterprises. Participation quotas are represented by 
shares of stock. Personal liability is limited to the amount of shares 
owned. The corporation is a legal person, an entity separate from its 
shareholders, and is liable for its obligations only to the extent of its 
assets. 
 
A corporation must have at least two shareholders. A minimum of 200 million 
lire is required for incorporation, 30 percent of which must be deposited 
with Banca d'Italia in a noninterest bearing account until organization 
formalities are completed. The entire capital stock of the company must be 
subscribed. If the original stock exceed 2 billion lire, the Ministry of 
Treasury must give special authorization. 
 
The article of incorporation and the bylaws must be drawn up before a notary 
public according to specifications in the Civil Code, Article 2328. The 
company is incorporated when the articles of incorporation have been 
approved by the court and the registry tax is paid. Copies of documents 
concerning the life of the corporation must be filed with the local chamber 
of commerce. 
 
European Economic Interest Group (EEIG) -- Since the formation of the 
European Community, cross-border business activity has been increasing. The 
European Economic Interest Group (EEIG) is a legal arrangement developed by 
the EC to encourage European trade. An EEIG must have a minimum of two 
member firms that maintain head offices or main activities in different EC 
member countries. An individual, a company, or other organization 
established in the EC may be a member of an EEIG. This business form would 
be advantageous for an activity that would be too costly or risky for one 
firm to undertake, but becomes profitable if carried out with other firms. 
 
Branch Versus Subsidiary -- To undertake market development, some firms 
prefer to establish a branch or subsidiary in Italy. A branch is easy to 
establish, and the firm can employ and control its own sales force rather 
than rely on agents or distributors. A subsidiary is also easily set up. 
Liability extends only to the amount of the issued shares for the 
subsidiary. An American firm usually elects to establish a subsidiary rather 
than a branch. 
 
 
OVERVIEW OF TAXES 
 
Corporate Taxation 
Corporations in Italy pay a tax rate on corporate income (IRPEG) of 36 
percent and a local income (ILOR) tax rate of 16.2 percent. In filing, 75 
percent of the latter is deductible, giving an effective overall corporation 
tax rate of 47.8 percent. Dividends are subject to a 10 percent withholding 
tax that is credited against corporation income tax. 
 
In the absence of a tax treaty, foreign income tax is credited against 
corporation income tax payable on the same income. The credit is limited to 
the proportion of the Italian tax corresponding to that borne by the foreign 
income to total income. It is granted on a reciprocal basis, within the same 
limits as in the source country. If the source country grants neither credit 
nor exemption, a credit of 90 percent of the maximum is granted for business 
income and a credit of 50 percent of the maximum for other income. 
 
Taxable Income 
Resident and nonresident corporations pay corporation income tax (IRPEG) and 
local income tax (ILOR). Corporations having their statutory domicile, 
principal management, or main activity in Italy are treated as resident 
 
 
companies and are subject to corporation income tax on worldwide income. 
 
Taxable income is based, for both corporation and local income tax purposes, 
on net profits realized in the accounting year, in accordance with the 
profit and loss account, as adjusted for tax purposes. Local income tax is 
generally chargeable only on income from Italian sources. 
 
Nonresident companies are subject to corporation income tax and local income 
tax on income derived from a permanent establishment in Italy, interest, 
dividends, income from real property, and royalties and rents from Italian 
sources. 
 
Tax Returns 
The annual tax return, which covers both national and local income taxes, 
must be submitted within 1 month after the approval of the annual accounts. 
An advance payment of 92 percent of the previous year's liability or of the 
estimated liability for the current year (whichever is the lower) must be 
made during the 11th month of the tax year (which corresponds with the 
accounting year). Any balance is payable when the tax return is submitted. 
The tax authorities may issue final assessments by the end of the 5th year 
after the return has been submitted. Branches of foreign companies must 
submit their tax return within 4 months of the end of the calendar year. 
 
Capital gains are subject to corporation and local income taxes in the same 
way as income insofar as they are connected with a commercial activity in 
Italy. However, tax on gains credited to a special reserve and reinvested in 
fixed depreciable assets within the two following years my be deferred. A 
special local tax applies to increases in value of real property. 
 
Dividends are subject only to corporation income tax. Italian corporations 
that are shareholders of other Italian corporations receive a tax credit of 
the amount of dividends received. This eliminates taxation on intercompany 
dividends. Only 40 percent of foreign dividends received by an Italian 
corporation owning more than 10 percent of the payer is subject to tax. 
 
Italy has an importation system which in effect eliminates the corporate tax 
on dividends paid by Italian corporations to Italian resident shareholders. 
Such shareholders add 9/16 of the dividend received to their taxable income 
and claim a credit of an equal amount against their individual tax 
liability. A compensatory tax of up to 36 percent applies to dividends paid 
by Italian corporations out of profits subject to a corporate tax of less 
than 36 percent. The compensatory tax applies even when the shareholders are 
nonresidents of Italy and therefore not eligible for the dividend tax credit. 
 
Allowable Deductions 
Wages, salaries, and commissions are deductible expenses. Salaries paid to 
controlling directors are deductible within the limits of salaries paid to 
other directors. No deduction is allowed for directors' shares of profit. 
 
Interest is not deductible up to the amount of exempt income. Interest 
exceeding that amount is the ratio between the company's gross taxable 
income and its total income (without considering fully undeductible 
interest). All domestic taxes other than corporation income tax and 
recoverable taxes, such as the value-added tax, are deductible. 
 
Welfare contributions and pension payments are deductible if they are made 
under a binding or legal obligation. 
 
Management expenses are deductible if they can be substantiated by services 
rendered. 
 
 
 
Other expenses are usually deductible in the same manner as interest expense 
explained above. 
 
Losses may be carried forward for 5 years for corporation income tax 
purposes, but not for local income tax purposes. They may not be carried 
back. 
 
All assets recorded in the annual accounts are depreciable on a 
straight-line basis. Maximum rates for physical assets are fixed by the 
Ministry of Finance, and are from 3 to 7 percent for buildings, 6 to 12.5 
percent for general machinery; 12.5 to 18 percent for special machinery; and 
20 percent for vehicles. The minimum rate of depreciation is 50 percent of 
the maximum rate. 
 
Accelerated depreciation of an additional 15 percent is permitted in each of 
the first 3 years. Costs of maintenance, repairs, modernization, and 
replacement are immediately deductible up to a limit of 5 percent of the 
cost of all depreciable assets at the beginning of the accounting year, any 
balance being deductible over 5 years. Patents, know-how, and licenses are 
depreciable over their useful lives as determined by the law or by the 
contract. The maximum depreciation rate of goodwill is 20 percent per annum. 
Research and development expenditure is deductible in that year and up to 4 
subsequent tax years. Advertising expenses may be deducted or depreciated on 
a straight-line basis over 3 years. Expenses incurred in commencing business 
may be deducted over not more than 5 years. 
 
Seventy percent of the taxable income of companies, wherever situated, is 
exempt from local income tax if the income is reinvested in the Mezzogiorno 
area within 1 year of the submission of the tax return. The project must be 
completed within 3 years. 
 
Tax Convention with Italy 
The United States and Italy have maintained a tax treaty relationship since 
1955, with the current treaty signed in 1984. This treaty has several 
purposes but is principally designed to avoid double taxation, reduce 
withholding tax rates, avoid discriminatory treatment on tax matters, and to 
prevent tax evasion. 
 
The tax treaty covers types of double tax relief procedures to be applied in 
each country as well as providing a procedure for the resolution of tax 
problems. IRS Revenue Procedure 91-23, I.R.B. 1991-11, 18, details this 
procedure for U.S. taxpayers. 
 
A fundamental objective of the tax treaty is to reduce the tax burden on 
investment and business income of foreign investors in order to facilitate 
efficient allocation of cross-border folows of capital, investment, and 
trade. The treaty with Italy provides for a 5 percent tax rate on dividends 
on direct investments (those  with more than 50 percent ownership). 
Regarding dividends, of particular interest to the U.S. business community 
is the application of the Italian Equalization Tax, which is not covered in 
the current treaty. When an Italian company pays a dividend from corporate 
income previously exempted from taxation, it now must pay an equalization 
tax. The Italian recipient of this dividend may take advantage of a tax 
credit but because a U.S. recipent is generally not subject to taxes in 
Italy, this tax credit is lost. 
 
The treaty also reduces the rate of Italian withholding tax on other 
investment income of U.S. residents. Portfolio dividends and interest are 
taxed at a rate not exceeding 15 percent. Royalties for artistic or 
 
 
scientific work are taxed at no more than 5 percent; with other royalties 
taxed at no more than 10 percent. 
 
To ensure compliance the Italian authorities occasionally require 
certification. The Italian importer will request the American exporter to 
provide this certification. U.S. firms requiring this certification for 
Italian tax purposes should consult the procedure outlined in IRS 
Publication 686, Certification for Reduced Tax Rates in Treaty Countries. In 
general, the U.S. taxpayer submits a letter of application to the IRS 
Service Center where the tax return is filed and receives the certification 
from the IRS. 
 
The Italian authorities may also request documentation as to residence. The 
U.S. IRS Center does not attest to country of residence since this is 
difficult to ascertain.  Instead, it certifies that the person has filed a 
tax return consistent with being a U.S. resident. For additional 
information, call the IRS at (1-800)  829-3676. Publications may be ordered 
from: Form Distribution Center, P.O. Box 25866, Richmond, VA 23289. For 
further information on the tax treaty with Italy contact: Internal Revenue 
Service, International Tax Treaty Division, P.O. Box 23598, Washington, DC 
20026. 
 
 
EMPLOYMENT 
 
Industrial Relations 
For the established and large firms, pay scales and other conditions of 
employment are agreed on through collective bargaining between employers and 
employees. Some areas,  such as working hours, safety, and holidays, are 
defined by law. 
 
Job placement is a public function and is carried out by public agencies 
operating under the purview of the Ministry of Labor and the Ministry of 
Social Security. According to law, every person wishing to be employed must 
register with the Ministry of Labor Employment Office in his locality. While 
private employment agencies are generally prohibited from operating in 
Italy, some specialized ones do exist in special cases such as for employing 
domestic workers. 
 
Workers may be hired directly or through an employment office. Workers hired 
through employment offices include manual workers and workers filling 
low-level clerical positions.  These workers are provided to firms according 
to their numerical position on the waiting list and not by name. Persons 
hired for executive positions are hired by name and experience. 
 
A firm may hire workers directly only in certain cases such as when seeking 
to hire an individual already employed by another firm, when certain 
executive positions must be filled, by firms' having less than four workers, 
or for persons to be employed as a result of public competitive 
examinations. The practice of hiring directly has expanded during the past 
few years despite the rigidity of hiring procedures imposed by government 
employment offices. 
 
An employer seeking to hire workers with specific skills must submit a 
written request to the employment office in his district. The employer has 
the right to refuse to employ workers referred to him by the employment 
office who either have been previously dismissed from other jobs for 
legitimate reasons or prove to be unsatisfactory. According to Italian law, 
almost all apprentices may be employed directly. 
 
 
 
The government is gradually reducing some rigidities inherent in the 
employment system such as permiting direct hire of workers on a part-time 
basis and allowing reduced working hours or wage adjustments to maintain a 
competitive position internationally and the level of employment. In 
addition, greater allowances are being made for flexibility in work 
schedules. 
 
No person under 15 years of age may be employed unless an exemption is 
obtained from the Labor Ministry. The employment of women and minors is 
subject to various restrictions, depending on the type of labor involved. 
 
 
Dismissal of workers 
Dismissal from employment in Italy is controlled by labor-management 
agreements and by law. Both protect worker's interests through a series of 
provisions such as notice of dismissal, compulsory consultations, and 
monetary compensation and reemployment rights in cases of work reductions. 
 
A special fund, called the Wage Supplement Fund--largely financed by the 
government--is available to companies which are undergoing reduction. The 
fund also provides assistance to both employers and workers when companies 
are forced to reduce temporarily their work force or when companies are 
faced with difficulties caused by an economic crisis affecting the area in 
which the companies are located. 
 
Employment of Foreign Workers 
The principal criteria for foreigners obtaining permission to work in Italy 
are:  (a) the foreign applicant must have found a specific job, (b) the 
prospective employer must have requested permission to employ the worker, 
and (c) the employer must be able to justify the employment of a foreigner 
rather than an Italian on the grounds that local workers are not available 
to supply the specialized talents required for the job. 
 
Work permits are not required for EC nationals, but are required for 
nationals of other nations, including the United States. Persons going to 
Italy to take up employment are urged to have a position established and a 
work permit already issued prior to departing for Italy. Italian firms 
interested in employing a worker from a non-EC country must make the 
application to the Ministry of Economic Affairs. 
 
Requests for work permits must be submitted to an Italian Consulate in the 
United States and be accompanied by all pertinent documentation from the 
prospective employer. The Ministry of the Interior (Direzione General di 
Publica Sicurezza) makes the final decision on the issuance of the work 
permit following consultation with the Ministries of Labor and Social 
Security. This procedure is not required for citizens of EC member countries 
or Swiss citizens. 
 
Persons expecting to remain in Italy for more than 3 months must obtain a 
visa which is normally granted for a period of from 6 months to 3 years, 
depending on the references given and the nature of the enterprise. Upon 
arrival in Italy, the applicant must proceed to the local police 
headquarters to obtain a Permit of Stay, which classifies the applicant as a 
resident for the purpose of engaging in business. Extensions are rarely 
denied and U.S. citizens are generally allowed to remain in Italy as long as 
they are successfully engaged in the activity for which they came. 
 
Foreign workers in Italy enjoy the same social legislation rights as Italian 
nationals. In cases of unemployment, however, Italian law does not provide 
for registration of foreign workers with the employment offices. 
 
 
Nevertheless, foreign workers are eligible to receive the same social 
security benefits provided Italian nationals (including old age, disability, 
family allowances, and health and accident insurance). Pensions to workers 
permanently disabled in occupational accidents or through occupations 
diseases, as well as disability and old age pensions, are paid to foreign 
workers wherever they reside. 
 
 
Italy complies with the EC directives on employment by adopting the EC 
directives into their national legislation. Equal pay legislation requires 
that a female be paid the same rate as a male for doing similar work and 
that employers do not discriminate based on sex or marital status. 
 
 
Worker Advisory Councils 
The appointment of workers on the corporate board or the establishment of 
worker councils, as found in other European countries, is common in Italy 
and is a matter of negotiation between management and the union. Such 
councils are found in larger firms and are considered a forum or means of 
communication. 
 
GUIDANCE FOR BUSINESS TRAVELERS 
 
Business Courtesy 
By and large, what is considered good business practice in the United States 
also applies when doing business in Italy. Businesspeople in Italy also 
appreciate prompt replies to their inquiries, and they expect all 
correspondence to be acknowledged. 
 
Before embarking on a business venture to tap the market in Italy, the 
review of travel guides would be especially helpful. These guides contain 
useful hints on cultural differences and business protocol. 
 
Commercial Language 
Italian is the official language and is spoken in all parts of Italy, 
although some minority groups in the Alto Adige and Aosta regions speak 
German and French, respectively. Correspondence with Italian firms, 
especially if the letter is the first sent, should be in Italian. If a reply 
comes in English then the subsequent correspondence with the Italian firm 
can be in English. The use of Italian is not only regarded as a courtesy, 
but assures prompt attention and prevents inaccuracies which might arise in 
translation. Most large commercial firms, however, are able to correspond in 
various languages in addition to English and Italian, but a business 
overture or proposal is given more serious attention if written in Italian. 
 
The importance of having trade literature, catalogs, and instructions for 
the use of servicing of products printed in Italian cannot be 
overemphasized. The agent representative in Italy who has such material is 
in a far better competitive position than the one who can only show 
prospective customers and consumers literature in English. 
 
Business Hours 
The usual Italian business hours are from 8 or 9 a.m. to noon or 1 p.m. and 
from 3 to 6 or 7 p.m. Working hours for the various ministries of the 
government are normally form 8 a.m. to 2 p.m. without intermission. Bank 
hours are from 8:30 a.m. to 1:30 p.m. and 3:00-4:00 p.m.; they are closed on 
Saturdays. 
 
Passport and Visas 
Every U.S. traveler must have a valid passport. No visa is required of U.S. 
 
 
citizens visiting Italy for less than 3 months, but one is required for 
longer stays. An American citizen entering for permanent residence must 
register as soon as possible after entering the country. Application for a 
Stay Permit (Permesso di Soggiorno) is made at the local police station and 
is valid for two years. U.S. citizens planning to work in the country must 
first obtain a work permit. The permit is to be presented to immigration 
upon arrival. Work permit approval must first be obtained by the Italian 
employer and is usually granted only for specialized work or skills. 
Management and skilled workers have no difficulty in obtaining work permits. 
The Italian employer files an application at a Provincial Labor Office, 
which then authorizes an Italian Consulate in the United States to issue a 
work visa to the prospective employee. The application process should be 
initiated 3 to 4 months before it will be needed. 
 
A person seeking to work in Italy in an independent or self-employed 
capacity files an application directly with the Italian Consulate along with 
needed credentials demonstrating experience in the field of work. 
 
Other Information 
With the ease of telephone communications, international calls are 
frequently the best method of arranging appointments and maintaining solid 
commercial relations. The Italians are usually adept at handling business 
calls in English, but the caller must be prepared to expect some language 
differences and be able to make simple requests in Italian. The time zone 
for Italy is 6 hours ahead of the U.S. eastern standard time. Fax machines 
have increased the speed and ease of international communications and should 
be used to maintain strong business ties. 
 
Medical services are excellent and hospitals compare with those in the 
United States. Common medical needs are readily obtained, and special 
supplies are normally available on short notice. An international 
certificate of vaccination is not required for travelers from the United 
States. Drinking water is acceptable and most pharmaceuticals are available, 
and sanitation is at American standards. 
 
Rental automobiles are available at numerous locations. An international or 
state driving license is acceptable. Tipping is as appropriate in Italy as 
it is in the United States. Generally, tip waiters 10 percent if the service 
charge (servizio) has not been added to the check. 
 
Conservative business attire is recommended at all times. Business 
appointments are also required, and visitors are expected to be punctual. 
 
There is solid sales potential for U.S. goods and services in the Italian 
market. It is a highly competitive market, and the U.S. exporter must keep 
certain factors in mind to achieve maximum success. The "golden keys" of 
customary business courtesy, especially replying promptly to requests for 
price quotations and to orders, are a prerequisite for exporting success. In 
general, European business executives are more formal than their American 
counterparts; therefore, it is best to refrain from using first names until 
a solid relationship has been formed. During the first stages of conducting 
business, it is best to let the prospective buyer take the lead since the 
American approach of "getting down to business" may be considered abrupt. 
Avoid commenting on political events or negative comments about the country. 
Some positive and sincere  observations about the Italian culture, style, 
art, history, crusine, or music are always appropriate. Italian business 
executives tend to use titles indicating their position in the firm. 
Friendship and mutual trust are highly valued, and once an American has 
established this relationship a productive business association can usually 
be counted upon. 
 
 
 
Italian buyers appreciate style, quality, and service, but are also 
interested in delivered price. Care must be taken to assure that stated 
delivery dates will be maintained and that after-sales service will be 
promptly honored. Italians, and Europeans in general, are concerned that 
after placing an order with a supplier that the delivery date be honored. 
While there are numerous factors that may interfere with prompt shipment, 
the U.S. exporter must allow for additional shipping time and keep in close 
contact with the buyer. Meeting delivery schedules is of prime importance. 
It is much better to quote a later delivery date that can be guaranteed than 
promise an earlier delivery that is not completely certain. 
 
Obtaining Credit Information 
In addition to the World Traders Data Reports (WTDR) service provided by the 
Commerce Department to examine the reliability of a foreign firm, background 
information on Italian firms can also be obtained from the following sources: 
 
  Foreign Credit Interchange Bureau, National Association of Credit 
Management, 475 Park Avenue South, New York, NY 10003. 
 
  Dun and Bradstreet, Inc., 99 Church Street, New York, NY 10007. 
 
  Gradon America, 71 West 23rd Street, Suite 1629, New York, NY 10010. 
 
  Owens Online, 11701 Belcher Road South, Suite #111, Largo, FL 34643-5116 
 
  Major banks--contact the international section of any large city bank for 
assistance. 
 
  The American Bureau of Collections, Inc., 1100 Main Street, Buffalo, NY 
14209-2356 (a collection bureau with an overseas network). 
 
U.S. exporters should maintain close liaison with distributors and customers 
to exchange information and ideas. In most instances, mail, fax, or 
telephone communication is sufficient, but the understanding developed 
through periodic personal visits is the best way to keep distributors 
apprised of new developments and to resolve problems quickly. Prompt 
acknowledgement of correspondence by air mail or fax is recommended. 
 
Further, when sales volume warrants, U.S. exporters should seriously 
consider warehousing in Italy to maintain an adequate local supply and 
guarantee proper service of their European customers. A vigorous and 
sustained promotion is often needed to launch products because of entrenched 
buying habits. Products must be adapted to both technical requirements and 
to consumer preferences. It is not sufficient to merely label a product in 
conformity to national requirements for the development of the full market 
potential. Consumers must also be attracted to the product by the label and 
packaging as well as ease of use. 
 
Currency 
The basic monetary unit is the lira (plural: lire) and is usually indicated 
as L or Lit. Notes are issued for values of 1,000, 2,000, 5,000, 10,000, 
50,000, and 100,000. Coins are 50, 100, 200, and 500 lire. The value of the 
lira changes with respect to the U.S. dollar. Check the financial section of 
the daily newspaper for the current exchange rate. 
 
Major U.S. credit cards are usually accepted with proper identification, 
such as a passport, but visitors should always ask if a particular card is 
accepted prior to ordering meals or making hotel reservations. Travelers 
checks are accepted, but visitors should first inquire on the policy of the 
 
 
bank, hotel, or store before attempting to use them. 
 
Holidays 
Italian holidays must be taken into account when planning a business 
itinerary. July and August are poor months for conducting business in Italy 
since most business firms are closed for vacation during this period. The 
same is true during the Christmas and New Year period. Italian commercial 
holidays are listed in the box below and are the official statutory holidays 
when most commercial offices and banks are closed. Certain other days are 
celebrated as holidays within local jurisdictions. Holidays are also 
observed by the U.S. Embassy and should be considered when telephoning or 
visiting the U.S. and Foreign Commercial Service staff there.  When an 
Italian holiday falls on a Saturday, offices and stores are closed. 
 
 
                             ITALIAN    HOLIDAYS 
 
New Year's Day  (Capodanno)                     January 1 
Epiphany                                        January 6 
Easter Monday  (Lunedi di Pasqua) Variable 
Liberation Day (Festa della Resistenza)         April 25 
Labor Day  (Festa del lavoro)                   May 1 
Assumption (Assunzione)                         August 15 
All Saints Day  (Tutti i Santi)                 November 1 
Immaculate Conception                           December 8 
Christmas Day  (Natale)                         December 25 
St. Stephen's Day  (Santo Stefano)              December 26 
 
 
                         SOURCES   OF   INFORMATION 
 
U.S. Government 
 
Boyce Fitzpatrick--Italy Desk Officer 
(Serves as a national consultant to assist American firms develop a solid 
commercial export strategy and sales.) 
Room H-3043 
U.S. Department of Commerce 
14th Street and Constitution Ave., NW 
Washington, DC 20230 
Tel: (202) 482-2177 
Fax: (202) 482-2897 
 
American commercial interests are promoted and safeguarded in Italy by the 
following officers and staff : 
 
Keith R. Bovetti,  Minister  Counselor 
Michael Frisby, Commercial Counselor 
U.S. & Foreign Commercial Service 
American Embassy Rome 
APO AE  09794 
Tel: 011-39-6 4674-2202 
Fax: 011-39-6 4674-2113 
 
Peter F. Alois, Principal Commercial Officer 
David Fulton, Commercial Attache 
Richard Rothman, Commercial Officer 
U.S. & Foreign Commercial Service 
American Consulate Milan 
APO AE 09624 
 
 
Tel: 011-39-2 498-2241 
Fax: 011-39-2 481-4161 
 
Alessandra Gola 
Commercial Specialist 
American Consulate Florence 
Tel: 011-39-55  211 676 
Fax: 011-39-55  283 780 
 
Susanna Lezzi 
Commercial Specialist 
American Consulate Genoa 
Tel: 011-39-10  247-1412 
Fax: 011-39-10  290 027 
 
Cristiano Sartorio 
Commercial Specialist 
American Consulate Naples 
Tel: 011-39-81  761-1592 
Fax: 011-39-81  761-1869 
 
Office of European Community Affairs 
(Duty rates/ EC standards information) 
U.S. Department of Commerce 
Washington, DC 20230 
Tel: (202) 482-2905 and 482-5279 
 
U.S. Department of Commerce 
The International Trade Administration has district offices located in major 
cities throughout the United States (consult telephone directory for local 
office). 
 
Bureau of Export Administration 
(Export licensing information) 
Room H-1099D 
U.S. Department of Commerce 
Washington, DC 20230 
Tel: (202) 482-4811 
 
Standards Information Service 
National Institute of Standards and Technology (NIST) 
Building 411,  Room A163 
Gaithersburg, MD 20899 
Tel: (301) 975-4040 
 
National Marine Fisheries Service (NOAA) 
(Exporting seafood) 
1335 East-West Highway 
Silver Spring, MD 20910 
Trade Services Division 
Tel: (301) 713-2379 
Inspection Services Division 
Tel: (301) 713-2355 
 
U.S. Small Business Administration 
Office of International Trade 
1441 L Street, NW, Room 501-A 
Washington, DC 20416 
Tel: (202) 634-1500 
 
 
 
U.S. Department of Agriculture 
Foreign Agricultural Service 
Washington, DC 20228 
Duties/quotas on agricultural goods 
Tel: (202) 720-1312 
Food regulations and labeling 
Tel: (202) 720-9408 
Trade issues and markets 
Tel: (202) 720-1301 
 
U.S Bureau of the Census 
(Publishes a wide variety of trade statistics. Check local municipal or any 
university library for details. Census also provides computer printouts of 
trade data.) 
U.S. Department of Commerce 
Suitland, MD 20233 
Tel: (301) 763-7754 
 
U.S. Department of State 
Italy Desk Officer 
Washington, DC 20232 
Tel: (202) 647-5669 
 
U.S. Department of the Treasury 
Western European Office 
15th Street and Pennsylvania Ave., NW 
Washington, DC 20230 
Tel: (202) 622-2000 
 
Internal Revenue Service 
International Tax Treaty Division 
P.O. Box 23598 
Washington, DC 20026 
Tel: (202) 874-1540 
 
U.S. Department of Labor 
(Labor reports and statistics) 
Bureau of Labor Statistics 
2 Massachusetts Avenue, NW 
Washington, DC 20212 
Tel: (202) 606-7828 
 
Export-Import Bank of the United States 
811 Vermont Avenue, NW 
Washington, DC 20571 
Tel: (202) 566-4490 
 
Other Organizations 
 
American National Standards Institute 
11 West 42nd Street 
New York, NY 10036 
Tel: (212) 642-4900 
 
American Chamber of Commerce in Italy 
1, Via Cesare Cantu 
20123 Milan 
Tel: 011-39-2 869-0661 
Fax: 011-39-2 805-7737 
 
 
 
U.S. International Chamber of Commerce 
156 Fifth Avenue 
New York, NY 10010 
Tel: (212) 206-1150 
 
Italy-America Chamber of Commerce (IACC) 
(Facilitates bilateral trade in products, services, and investments. The 
IACC provides a data service through an information bank developed by the 
Italian Chambers of Commerce as well as a joint-venture referal service.) 
730 Fifth Avenue 
New York, NY 10019 
Tel: (212) 279-5520 
 
U.S. Chambers of Commerce 
(For certificates of origin, contact your local office.) 
 
European Community Information Service 
2100 M Street, NW 
Washington, DC 20037 
Tel: (202) 862-9500 
 
Foreign Credit Insurance Association 
40 Rector Street 
New York, NY 10006 
Tel: (212) 306-5000 
 
National Italian American Foundation (NIAF) 
(NIAF conducts cultural and educational events, sponsors exchange programs, 
works to enhance cultural, political, and economic relations between the 
United States and Italy and serves as an advocacy group.) 
666 Eleventh Street, NW,   Suite 800 
Washington, DC  20001 
Tel: (202) 638-0220 
 
U.S. Council for International Business 
(Carnets to simplify Italian customs clearance with business samples) 
1212 Avenue of the Americas 
New York, NY 10036-1689 
Tel: (212) 354-4480 
(There are offices in Houston, Boston, San Francisco, 
Los Angeles, Miami, and Schaumburg, IL.) 
 
Underwriter's Laboratories, Inc. 
Technical Assistance to Exporters 
333 Pfingster Road 
Northbrook, IL 60062 
Tel: (708) 272-8800 
 
Exhibition Associations 
 
Associazione Enti Fieristici Italiani (AEFI) 
c/o Ente Autonomo Fiera di Rimini 
Via della Fiera 23 
47037 Rimini 
Tel: 011-39-541  78 20 00 
Fax: 011-39-541  77 43 13 
 
Associazione Nazionale Azienda Allestitrice di Fiere e Mostre (ASAL) 
Via Fiamma 19 
20129 Milano 
 
 
Tel: 011-39-2  71 46 65 
Fax: 011-39-2  71 54 09 
 
Associazione delle Mostre Specializzate (ASSOMOSTRE) 
Via Domenichino, 11 
20149 Milano 
Tel: 011-39-2  481-3204 
Fax: 011-39-2  498-0330 
 
 
Exhibition Organizers 
 
 
Fiera Milano (Organizers of  international  fairs in Milan) 
Delia Associates (U.S. representative) 
P.O.  Box 338 
Whitehouse, NJ   08888 
Tel: (800) 524-2193 
Fax: (908) 534-6856 
 
Fiera di Roma 
Via dell'Arcadia, 2 
00146 Rome 
Tel: 011-39-6  51781 
Fax: 011-39-6  517-8205 
 
Fiera di Trieste 
Piazzale De Gasperi, 1 
34139 Trieste 
Tel: 011-39-40  39 29 61 
Fax: 011-39-40  39 30 62 
 
Fiera del Levante 
Lungomare Starita 
70123 Bari 
Tel: 011-39-80  20 61 11 
Fax: 011-39-80  34 16 54 
 
Fiera di Verona 
C.P 525 
37100 Verona 
Tel: 011-39-45  588 111 
Fax: 011-39-45  588 288 
 
Italian Trade Associations 
Confederazione Generale dell'Industria  (Confindustria) 
(Confindustria is the general confederation of Italian industry and 
principal trade association in Italy acting as an umbrella organization 
covering numerous industry trade associations.) Viale dell'Astronomia, 30 
00144 Rome 
Tel: 011-39-6  59 031 
 
Confederazione Generale Italiana del Commercio e del Turismo  (Confcommercio) 
(Confcommercio is an umbrella trade association affiliated with industry 
groups in commerce and tourism.) 
Pazza G. G. Belli, 2 
00153 Rome 
Tel: 011-39-6  58 661 
 
Confederazione Generale Italiana dell'Artigianato 
 
 
(General confederation of handicrafts associations.) 
Piazza Venezia, 11 
00187 Rome 
Tel: 011-39-6  679-1420 
 
Associazione Bancaria Italiana 
(Association of Italian Banks) 
Piazza del Gesu, 49 
00186 Rome 
Tel: 011-39-6  67 671 
 
Associazione Nazionale fra le Imprese Assicuratrici 
(National Association of Business Insurance) 
Via della Frezza, 70 
00186 Rome 
Tel: 011-39-6  322 7141 
 
Confederazione Italiana della Piccola e Media Industria 
 (CONFAPI)  (Industry confederation serving small- and medium-size firms.) 
Via della Colonna Antonina, 52 
00186 Rome 
Tel: 011-39-6  678-2441 
 
Confederazione Cooperative Italiane 
Bg. S. Spirito, 78 
00193 Rome 
Tel: 011-39-6  650 861 
 
Confederazione Generale del Traffico e dei Trasporti 
Via Panama, 62 
00198 Rome 
Tel: 011-39-6  869 151 
 
Confederazione Generale dell'Agricoltura Italiana 
Corso Vittorio Emanuele II, 101 
00186 Rome 
Tel: 011-39-6  65 121 
 
Confederazione Nazionale Coltivatori Dirette 
Via XXIV Maggio, 43 
00187 Rome 
Tel: 011-39-6  476 638 
 
Lega Nazionale Cooperative e Mutue 
(National  Cooperative and Mutual League) 
Via Guattani, 9/13 
00161 Rome 
Tel: 011-39-6  88 41 371 
 
Unione Italiana delle Camere di Commercio Industria 
Artigianato e Agricoltura 
Piazza Sallustio, 21 
00187 Roma 
Tel:  011-39-6  47 041 
 
Italian Government and Agencies 
 
The Italian Embassy 
1601 Fuller Street, NW 
Washington, DC 20009 
 
 
Tel: (202) 328-5500 
 
Italian Government Tourist Board (ENIT) 
630 Fifth Avenue, Suite 1565 
New York, NY  10111 
Tel: (212) 245-4822 
 
The Italian Trade Commission 
(Assists in locating Italian suppliers and products.)  Offices are located 
in the following cities: 
 
   2301 Peachtree Center 
   233 Peachtree Street, NE 
   Atlanta, GA 30343 
   Tel: (404) 525-0660 
 
   401 North Michigan Avenue 
   Suite 3031 
   Chicago, IL 60611 
   Tel: (312) 670-4360 
 
   1090 Natural Gas Tower 
   3050 Post Oak Boulevard 
   Houston, TX 77056 
   Tel: (713) 626-5531 
 
   1801 Avenue of the Stars 
   Suite 700 
   Los Angeles, CA 90067 
   Tel: (213) 879-0950 
 
   299 Park Avenue 
   New York, NY 10022 
   Tel: (212) 980-1500 
 
 
In Italy: 
 
Associazione Nazionale del Commercio con l'Estero (ANCE) 
(national Association for Foreign Trade) 
Corso Venezia, 47/49 
20121 Milan 
Tel: 011-39-2  7750 
 
Dipartimennto della Dogana 
(Department of Customs) 
Via vie delle Provincie 103 
00162 Rome 
Tel:  011-39-6  427-1043 
 
Istituto Nazionale per il Commercio Estero (IEC) 
Via List, 21 
00144 Rome 
Tel:  011-39-6  59 921 
 
Ufficio Italiano dei Cambi  (UIC) 
(Italian Exchange Office ) 
Via Quattro Fontane 123 
Rome 00184 
 
 
 
Istituto per la Ricostruzione Industriale 
Via V. Veneto, 89 
00187 Rome 
Tel: 011-39-6  47271 
 
Ente Nazionale Italiano di Unificazione (UNI) 
(Italian National Bureau of Standards) 
Piazza Armando Diaz 2 
20123 Milan 
Tel: 011-39-2   876 914 
 
Comitato Elettrotecnico Italiano 
(Electrical standards and certification) 
Viale Manza, 259 
20126 Milan 
Tel: 011-39-2  255-0641 
 
Ministero dell'Industria e Commercio 
Ufficio Centrale Brevetti per Invenzioni 
(Patent and trademark applications and inquiries) 
Modelli e Marchi 
Via Molise, 19 
00187 Rome, Italy 
Tel: 011-39-6  488-4450 
 
Presidenza del Consiglio dei Ministri 
Ufficio del Proprieta Letteraria, Artistica e Scientificia 
(Applications and inquires concerning copyrights) 
Via Boncompagni, 15 
00187 Rome, Italy 
 
Ministero delle Poste e Telcomunicazioni 
Viale America, 160 
00100 Rome 
Tel: 011-39-6  542-2004 
 
Societa' Italiana per l'Esercizio Telefonico (SIP) 
Via Flaminia,  189 
00196 Rome 
Tel: 011-39-6  3 68 81 
 
Tax and Accounting Firms 
 
Arthur Andersen 
1666 K Street, NW 
Washington, DC 20006 
Tel: (202) 862-3100 
 
Deloitte and Touche 
10 Westport Road 
Wilton, CT 06897 
Tel: (203) 761-3000 
 
Ernst and Young International 
787 Seventh Avenue 
New York, NY 10019 
Tel: (212) 773-6307 
 
KPMG Peat Marwick 
767 5th Avenue 
 
 
New York, NY 10153 
Tel: (212) 909-5596 
 
Price Waterhouse 
1251 Avenue of the Americas 
New York, NY 10020 
Tel: (212) 819-5000 
 
 
U.S. Publications and References 
 
Most of the following references and publications are on the National Trade 
Data Bank or may be ordered from the Superintendent of Documents, U.S. 
Government Printing Office, Washington, D.C. 20402 
Tel: (202) 783-3238 
 
Business America 
U.S. Department of Commerce 
(Biweekly magazine of international trade containing such information as 
country reports, developments in trade negotiations, trade events, and 
commercial activities.) 
 
Commerce Business Daily (CBD) 
U.S. Department of Commerce 
(Lists foreign commercial opportunities as reported by the Foreign 
Commercial Service. The CBD is available at ITA district offices, the SBA, 
and many public libraries.) 
 
Foreign Economic Trends--Italy 
U.S. Department of Commerce 
(A 12 page summary of Italian economic conditions with commercial 
opportunities and implications.) 
 
Foreign Labor Trends--Italy 
U.S. Department of Labor 
Bureau of International Labor Affairs 
Washington, DC 20402 
(Annual information on labor trends.) 
 
National Trade Data Bank 
U.S. Department of Commerce 
(CD-ROM disk containing extensive data for U.S. exporters.  The first stop 
when conducting market research. Call (202) 
482-1986 for technical specifications and ordering.) 
 
U.S. Census Bureau 
(Publishes a wide range of publications with U.S. trade statistics on 
imports and exports by product and country. This information is usually 
available at most university or municipal libraries.) 
 
A Basic Guide to Exporting 
U.S. Department of Commerce 
(A primer on exporting methods and sources of information.) 
 
Key Officers of Foreign Service Posts: Guide for Business Representatives 
U.S. Department of State 
(Lists names and addresses of key American officers overseas.) 
 
Other Publications and Information Sources 
 
 
 
Doing Business in Rome-A Guide to Success in the Eternal City 
 (Information and contacts for establishing a business.) 
U.S. & Foreign Commercial Service 
American Embassy Rome 
APO AE 09794 
 
American Chamber of Commerce Directory 
(Annual directory of member firms.) 
American Chamber of Commerce in Italy 
Via Cesare Cantu, 1 
20123 Milan 
Tel: 011-39-2 869-0661 
Fax: 011-39-2 805-7737 
 
Exporters' Encyclopaedia 
(A comprehensive source of information on all aspects of 
exporting and foreign regulations.) 
Dun's Marketing Services 
3 Sylvan Way 
Parsippany, NJ 07054 
Tel: (201) 605-6000 
 
Dun's Marketing Lists 
(Contact lists of foreign firms by product sector.) 
Dun's Marketing Services 
3 Sylvan Way 
Parsippany, NJ 07054 
Tel: (201) 605-6000 
 
Political Risk Forecasts 
(Risk factors related to finance, investment, and business 
outlook.) 
Political Risk Services 
222 Teall Avenue 
P.O. Box 6482 
Syracuse, NY 13217-6482 
Tel: (315) 472-1224 
 
PIERS-Port Import/Export Reporting Service (Reports on imports and exports 
by product, consignee, origin, destination, quantity, value, and weight, for 
major U.S. ports.) 
Journal of Commerce--PIERS 
Two World Trade Center, 27th Floor 
New York, NY 10048 
Tel: (212) 837-7000 
 
Investing, Licensing & Trading Conditions Abroad 
Economist Intelligence Unit 
215 Park Avenue, South 
New York, NY 10017 
Tel: (212) 460-0600 
 
Kompass Directory-Italy 
(3 volume business directory.) 
ETAS Kompass 
Via Manegna 6 
20154 Milan 
Tel: 011-39-2  50 751 
 
International Financial Statistics 
 
 
(Monthly financial statistics.) 
International Monetary Fund 
Publications Service 
700 19th Street, NW 
Washington, DC 20431 
Tel: (202) 623-7430 
 
OECD Economic Survey-Italy 
(Annual analysis of economic trends and prospects and a wide array of 
statistical reports.) 
Organization for Economic Cooperation and Development 
2001 L Street,  NW,  Suite 700 
Washington, DC 20036 
Tel: (202)  785-6323 
 
U.S. Firms, Subsidiaries, and Affiliates in Italy 
World Trade Academy Press 
Suite 509, 50 East 42 Street 
New York, NY 10017 
Tel: (212) 697-4999 
 
UNZ & Company 
(Supplies forms and educational materials for exporting) 
190 Baldwin Avenue 
Jersey City, NJ  07306 
Tel: (800) 631-3098 
 
Yellow Pages Telephone Directories 
(Obtain telephone directories for Italian cities at library or order through 
local telephone company.  AT&T provides copies of the Italian Yellow Pages 
by calling 
1-800 874-4000, extension 802) 
 
AT&T Language Line Services 
(AT&T provides interpreters 24 hours a day in 140 languages on-line or by 
fax and mail.) 
Call (1-800)  367-9559 for subscription information. 
 
Istituto Nazionale di Statistica  (ISTAT) 
(Publishes an extensive number of statistical reports on Italy.) 
Via Cesare Balbo, 11a 
00100 Rome 
Tel: 011-39-6   482-7666  or  482-4796 
 
Some of the ISTAT publications include: 
Annuario Statistico Italiano (Annual) 
Bolletino Mensile di Statistica (Monthly) 
Statistica Mensile del Commercio Con L'Estero 
   (foreign trade statistics, monthly.) 
Notiziario Istat (statistical bulletin,  monthly.) 
Indicatori Mensili (statistical indicators, monthly.) 
 
Centro Studi Investmenti Sociali (CENSIS) 
(A research institute conducting socio-economic studies.) 
CENSIS publications may be ordered from: 
DEA - Librerie Internazionali 
Via Lima, 28 
00198 Rome 
Tel: 011-39-6  861 441 
 
 
 
 
Credit Information 
 
World Traders Data Reports (WTDR) provided by a local  ITA Commerce 
Department District Office. 
 
Foreign Credit Interchange Bureau, National Association of Credit 
Management, 475 Park Avenue South, New York, NY 10003. 
 
Dun and Bradstreet, Inc., 99 Church Street, New York, NY 10007. 
 
Gradon America, 71 West 23rd Street, Suite 1629, New York, NY 10010. 
 
Owens Online, 11701 Belcher Road South, Suite #111, Largo, FL 34643-5116 
 
Major banks--contact the international section of any large city bank for 
assistance. 
 
The American Bureau of Collections, Inc., 1100 Main Street, Buffalo, NY 
14209-2356 (a collection bureau with an overseas network). 
 
 
                   EXPORTING   MARKETING   PLAN   OUTLINE 
 
 
 
Both large and small firms should have a marketing plan appropriate for 
their product needs, degree of exposure to risk, and as a tool for 
management oversight. The plan should start with modest goals and be 
expanded as the problems are defined and resolved. Usually, several drafts 
are needed before arriving at a satisfactory plan and even then, the export 
plan should be refined as conditions and information changes. It should also 
have complete management support and reflect a realistic program with the 
resources and long-term commitment needed to fulfill the plan.  Attainable 
milestones and review dates are especially useful in ensuring that the 
exporting program is maintained and achieved.  The following outline 
provides an initial approach to developing a plan and should be modified to 
suit individual needs.  In any event, a systematic and consistent approach 
will yield the greatest results   in short   PLAN and ACT. 
 
                                    PLAN 
 
Statement of Objectives 
Summary of exporting marketing plan identifying major goals, markets, time 
frame,  and  resources needed. 
 
Self-Assessment 
Product/service to be exported, domestic market share, competitive strengths 
and weaknesses. Current marketing channels and product demand and 
competitive trends. Current exporting experience and contacts. 
 
Information Sources 
The information gathering  and evaluating stage.  Collect data from the 
National Trade Data Bank, including Industry Sector Assessments, Foreign 
Economic Trends, trade statistics, and Overseas Business Reports. Contact 
U.S. Commerce Department trade specialists, local state and port 
authorities, and trade association resources.  Library research, yellow 
pages,  trade lists, and review trade literature and business contacts. 
 
Export Market Evaluation 
 
 
Selecting export markets, marketing  and distribution program to contact 
foreign buyers, commercial terms and sales price, product labeling and 
modifications, standards and certification, competition, product demand, 
shipping costs and delivery time, language skills, exchange rate risks, 
terms of sale, customs duties and taxes, local sales agents, distributors, 
after-sales support, trade shows, licensing, and joint-ventures. Possible 
use of consultant or exporting marketing company if in-house resources are 
not adequate. 
 
                                     ACT 
 
Exporting Timetable 
Identification of specific steps and timetable, develop cash flow schedule, 
estimated payback period, key individual or team members responsible for 
implementing exporting program. 
 
Management Review and Involvement 
Assessment of results against the plan, summary of experience and knowledge 
gained, statement of commercial opportunities developed or pending, problems 
encountered, suggestions to refine and expand exporting plan. Each person 
involved, from president to clerk, should read and sign the export plan on a 
signature page to indicate a commitment to the success of the plan and the 
development of  export sales. 
 
                           The  ITALIAN   REGIONS 
1.  VALLE  D'AOSTA 
Aosta  (AO) 
 
2.  PIEMONTE 
Torino  (TO) 
Alessandria  (AL) 
Asti  (AT) 
Cuneo  (CN) 
Novara  (NO) 
Vercelli  (VC) 
 
3.  LIGURIA 
Genova  (GE) 
Imperia  (IM) 
La Spezia  (SP) 
Savona  (SV) 
 
4.  LOMBARDIA 
Milano  (MI) 
Bergamo  (BG) 
Brescia  (BS) 
Como  (CO) 
Cremona  (CR) 
Mantova  (MN) 
Pavia  (PV) 
Sondrio  (SO) 
Varese  (VA) 
 
5.  TRENTINO ALTO ADIGE 
Trento  (TN) 
Bolzano  (BZ) 
 
6.  VENETO 
Venezia  (VE) 
Belluno  (BL) 
 
 
Padova  (PD) 
Rovigo  (RO) 
Treviso  (TV) 
Verona  (VR) 
Vicenza  (VI) 
 
7.  FRIULI VENEZIA GIULIA 
Trieste  (TS) 
Gorizia  (GO) 
Pordenone  (PN) 
Udine  (UD) 
 
8.  EMILIA  ROMAGNA 
Bologna  (BO) 
Ferrara  (FE) 
Forli  (FO) 
Modena  (MO) 
Parma  (PR) 
Piacenza  (PC) 
Ravenna  (RA) 
Reggio Emilia  (RE) 
 
9. TOSCANA 
Firenze  (FI) 
Arezzo  (AR) 
Grosseto  (GR) 
Livorno  (LI) 
Lucca  (LU) 
Massa Carrara  (MS) 
Pisa  (PI) 
Pistoia  (PT) 
Siena  (SI) 
 
10.  MARCHE 
Ancona  (AN) 
Ascoli Piceno  (AP) 
Macerata  (MC) 
Pesaro  (PS) 
 
11.  UMBRIA 
Perugia  (PG) 
Terni  (TR) 
 
12.  ABRUZZO 
L'Aguila  (AQ) 
Chieti  (CH) 
Pescara  (PE) 
Teramo  (TE) 
 
13.  LAZIO 
Roma  (ROMA) 
Frosinone  (FR) 
Latina  (LT) 
Rieti  (RI) 
Viterbo  (VT) 
 
14.  MOLISE 
Campobasso  (CB) 
Isernia  (IS) 
 
 
 
15.  CAMPANIA 
Napoli  (NA) 
Avellino  (AV) 
Benevento  (BN) 
Caserta  (CE) 
Salerno  (SA) 
 
16.  BASILICATA 
Potenza  (PZ) 
Matera  (MT) 
 
17.  PUGLIA 
Bari  (BA) 
Brindisi  (BR) 
Foggia  (FG) 
Lecce  (LE) 
Taranto  (TA) 
 
18.  CALABRIA 
Reggio Calabria  (RC) 
Catanzaro  (CZ) 
Cosenza  (CS) 
 
19.  SICILIA 
Palermo  (PA) 
Agrigento  (AG) 
Caltanissetta  (CL) 
Catania  (CT) 
Enna  (EN) 
Messina  (ME) 
Ragusa  (RG) 
Siracua  (SR) 
Trapani  (TP) 
 
20.  SARDEGNA 
Cagliari  (CA) 
Nuoro  (NU) 
Oristano  (OR) 
Sassari  (SS) 
 
 
Italy is divided into 20 Regions.  The Regions are further subdivided into 
Provinces.  Each Province is named after the capital city of that Province. 
The postal abbreviation of each Province is given in parentheses. 
 
 
 
 
 
 
 
 
 
 
 
 
 
--------------------------------------------------------------------------
This file extracted from Dept. of Commerce National Trade Data Bank (NTDB)
CD-ROM SuDoc No. C 1.88:993/12. Processed 12/01/1994 by software developed
by RCM (UM-St. Louis Libraries) / OBR_0007