Arbitration is considered to be an alternative to court litigation. Medium-sized to large companies, as well as companies belonging to international corporate groups, tend to refrain from engaging in court litigation in Italy – which is considered somewhat unpredictable, in terms of both timing and substantive outcomes.

In addition, arbitration is now widely applied in corporate disputes (eg, disputes among shareholders or disputes between companies and their directors, auditors, etc). Indeed, according to the most recent statistics published by the Milan Chamber of Arbitration (CAM), during 2021, one out of three arbitration proceedings related to corporate matters. While it can be said that arbitration is the preferred method of dispute resolution with regard to transnational disputes, court litigation is still widely used for domestic disputes and by small to medium-sized enterprises.

The COVID-19 outbreak has positively influenced the arbitration field in the perception of clients and users.

Indeed, as opposed to the ordinary courts, which have faced some difficulties in setting up an efficient way to handle cases, arbitral institutions have provided clients with a basically uninterrupted dispute resolution service instead. After all, the efficient use of technology has been a goal of the major arbitral institutions for quite some time, and they have therefore been more ready to face the high demand for virtual hearings than national courts. It should also be noted that in the aftermath of the COVID-19 outbreak, the high level of co-operation between the different arbitral institutions led to significant advancements in terms of digital technologies and available techniques, which permit arbitration procedures to continue without undue delay. For example, the International Chamber of Commerce (ICC) Guidance Note (which also applies to the CAM) allows an award to be signed electronically.

In this sense, the COVID-19 outbreak has proven the capacity of the international arbitration community to promptly react to the changed landscape.

Over the last few years, Italian companies have increasingly resorted to international arbitration, especially in industrial sectors such as energy, construction, procurement, oil and gas, distribution, real estate, pharmaceuticals, aviation and information technology.

Companies involved in the above-mentioned industrial sectors mostly deal with transnational matters and cross-border transactions. As a result, a common playing field to resolve disputes with a certain degree of predictability is much needed, at least with respect to procedure.

International arbitration is key in this respect. The above-mentioned industries seem to be less reluctant to make recourse to arbitration – which, as far as the Italian jurisdiction is concerned, is still considered to be a relatively expensive dispute resolution mechanism.

No area has experienced a particular decrease in international arbitration activity in 2021–22.

International arbitrations seated in Italy or involving Italian parties are usually administered by the Milan Chamber of Arbitration (CAM) or the International Court of Arbitration of the International Chamber of Commerce (ICC).

Companies that have more experience in the field of international arbitration, or which are part of international corporate groups, also resort to other arbitral institutions, such as the Swiss Chambers’ Arbitration Institution (SCAA), the German Arbitration Institute (DIS), the Hong Kong International Arbitration Centre (HKIAC) and the London Court of International Arbitration (LCIA). In any event, the ultimate choice of arbitral institution largely depends on the parties’ previous experience and on their respective nationalities.

No new institution has been set up over 2021–22, to the best of the authors’ knowledge.

There are no courts in Italy designed specifically for arbitration matters.

Arbitration matters are essentially governed by Articles 806 to 840 of the Italian Code of Civil Procedure (ICCP). Such provisions apply to domestic and international arbitrations seated in Italy, but only if they have not been waived by the parties to the arbitration agreement or by the applicable arbitration rules.

However, there are provisions which cannot be derogated and/or waived by the parties, ie, the public order and other mandatory rules of the law of the seat.

Following legislative reform enacted in 2006, Italian law no longer provides for a set of national law provisions specifically governing international arbitration. International arbitration is governed by international conventions, treaties and arbitration rules specific to the case.

In addition to the above provisions, a separate set of rules is provided under Legislative Decree No 5 of 17 January 2003 with respect to arbitration relating to corporate matters.

Italian arbitration law is not based on the UNCITRAL Model Law even though their provisions are substantially aligned; the main exceptions concern the powers of arbitrators to grant interim and urgent relief, which are denied under Italian law.

Following two comprehensive reforms, enacted in 1994 and 2006 respectively, Italy now has a modern arbitration-friendly regime.

Furthermore, the long-awaited prospective reform of the Italian civil judicial system should be mentioned. The new legislation, Law No 206/2021 (“Law 206”), which shall be enacted in 2023, establishes directives to be implemented by the Italian Government through specific legislative enactments amending the ICCP. The implementation phase will be finalised within one year of the date of entry into force of the law (ie, 24 December 2021).

In particular, the amendments provided under Article 1 para 15 of Law 206 aim to increase Italy’s appeal in the international arbitration market. In particular, the reform strives to:

• reinforce the guarantee of the impartiality and independence of arbitrators;
• rule on the immediate enforceability of the decree through which the President of the Court of Appeal recognises a foreign arbitral award;
• allow arbitrators to issue interim relief (superseding the prohibition embedded in Article 818 of the ICCP) when expressly allowed by the parties;
• insert an express clause on the parties’ possibility to choose the applicable law to the dispute;
• reduce from one year to six months the term for challenging arbitral awards in arbitrations seated in Italy whenever parties have not served the award; and
• regulate the so-called translatio iudicii – which is the transfer of the proceedings to a different judicial office – between arbitrations and court proceedings.

An arbitration agreement can be entered into either as a part of a contract (ie, as an arbitration clause) aimed at covering future disputes or as an autonomous agreement, usually entered into when a dispute has already arisen.

In order for an arbitration agreement to be enforceable, it needs to be valid and effective. To this end, when drafting an arbitration agreement, the legal requirements relating to the form and the content set out by the Italian law shall be observed (see 3.4 Validity).

The notion of arbitrability is set forth in Article 806(1) of the ICCP. Generally speaking, parties are free to submit to arbitration all disputes (contractual and non-contractual) except for those (a) involving inalienable rights (so-called “diritti indisponibili”); and (b) concerning subject matters that cannot be arbitrated under specific laws.

In particular, it is not possible to arbitrate disputes concerning:

• inalienable rights (ie, rights strictly pertaining to a right which the right-holder cannot freely dispose of (eg, citizenship, nationality or parenthood));
• in-person rights;
• labour disputes (unless arbitration is provided in the collective bargaining agreements or authorised in the Workers’ Statute);
• tax disputes; and
• disputes against the public administration, which must be submitted to the jurisdiction of administrative courts.

As far as agency agreements are concerned, different considerations apply. While disputes involving agency agreements are usually considered as falling within the scope of labour disputes, and are hence in principle excluded from arbitration, a different conclusion might be reached where the agent is a company.

Disputes with the public administration can be arbitrated only if they concern rights iure privatorum (subjective rights not involving public law matters).

In order to establish whether a dispute is arbitrable, Italian courts apply the principles of contract interpretation as provided by law, essentially considering the subject matter of the dispute, the nature of the claim and the specific interests safeguarded thereby. In any event, Italian law requires the scope of the arbitration agreement to be interpreted broadly to include any dispute arising from either the contract that includes it or the relationship to which the arbitration agreement refers.

Italian courts tend to adopt an arbitration-friendly approach when dealing with arbitration agreements. The general principle of favor arbitrati is indeed enshrined in Article 808-quater of the ICCP. As a consequence, an arbitration agreement must be interpreted broadly and, in case of doubt, the arbitration agreement shall be considered applicable to all disputes deriving from the contract that includes it or the relationship to which the arbitration agreement refers.

Accordingly, Italian courts tend to enforce arbitration agreements and decline jurisdiction in favour of an arbitral tribunal when an arbitration agreement is validly invoked.

As to the law governing the arbitration agreement, the courts generally refer to the law governing the contract that includes the arbitration agreement. In the absence of a law governing the contract, reference can be made to the criteria set forth under Regulation (EC) No 593/2008 (Rome I).

Pursuant to Articles 807 and 808 of the ICCP, arbitration agreements must, under sanction of nullity, (a) be made in writing; and (b) expressly indicate the subject matter of the dispute. Italian law interprets written form widely; hence, arbitration agreements are considered validly entered into also via electronic means (facsimile, email, electronic forms with electronic signatures, etc). The parties can submit both contractual and non-contractual disputes to arbitration; in the latter case, the parties shall specifically identify the non-contractual relationship.

As far as arbitration of corporate matters is concerned (eg, disputes between shareholders or between shareholders and directors or auditors) arbitration agreements included in a company’s articles of association shall provide for the appointment of all arbitrators by a third appointing authority, failing which the arbitration agreement will be declared null and void.

Under Italian law, the validity of the arbitration clause must be evaluated independently of the underlying contract. The rule of severability is indeed enshrined in Article 808 of the ICCP. Circumstances affecting the validity of a contract have thus no impact on the arbitration clause, the validity of which is assessed on a standalone basis. This principle is well settled and uniformly applied.

Under Italian law, the power to enter into a contract includes the power to enter into an arbitration clause.

The parties retain a wide discretion on the selection of arbitrators. According to Article 812 of the ICCP, anyone can be appointed as an arbitrator, with the exception of individuals lacking legal capacity, whether in full or in part.

Nevertheless, a few limits exist. First of all, Article 809(1) of the ICCP establishes a restriction on the number of members of the arbitral tribunal, which has to be an odd number. Secondly, limits on who may be selected as an arbitrator may apply to individuals who hold certain positions (eg, judges of national courts, or individuals executing certain public functions). A specific limit also applies to an arbitration on corporate matters: the arbitration agreement shall mandatorily indicate the third subject who will be in charge of the appointment of the panel.

In the event that the number of arbitrators is not indicated and the parties’ chosen method for selecting arbitrators fails, Article 809(3) of the ICCP provides for a default procedure whereby the arbitral tribunal shall be composed of three arbitrators who shall be appointed by the president of the court at the seat of arbitration or, if the seat is not yet defined, by the president of the court of the place where the arbitration agreement was entered into (if in Italy) or by the president of the court of Rome (if abroad).

No specific procedure is provided by Italian law that applies to multi-party arbitration.

Court intervention in the process of selection of arbitrators is very limited and is usually driven by the failure of the parties to appoint. As a consequence, Italian law provides that the court of the seat of arbitration (in person, the president of that court) can intervene in the selection of arbitrators in the following circumstances:

• where the parties referred the appointment of one or more arbitrators to the court;
• where the parties agreed to appoint an even-numbered arbitral tribunal, in order to appoint the final arbitrator;
• where one or more parties failed to appoint an arbitrator;
• where the third-party appointing authority failed to appoint one or more arbitrators;
• where, for any reason, one or more of the appointed arbitrators is removed and the arbitration agreement does not provide any guidance in this respect, or the appointing authority failed to perform the appointment; and
• in all cases of challenge or removal of arbitrators.

The president of the court can intervene in the appointment of arbitrators only upon a party’s request. The president of the court shall proceed with the appointment unless (i) the arbitration agreement is manifestly non existent, or (ii) the arbitration agreement provides for a foreign arbitration.

The challenge and removal of arbitrators is governed by Articles 813 bis and 815 of the ICCP. Pursuant to Article 813 bis of the ICCP, arbitrators who do not timely fulfil their duties can be removed upon the parties’ agreement or by the president of the court, upon a party’s request, 15 days from receipt of a formal demand of performance.

As far as challenges to arbitrators are concerned, the appointment of an arbitrator can be challenged upon the occurrence of any of the following circumstances, which may jeopardise his or her impartiality and independence:

• he or she lacks the specific requirements set by the parties;
• he or she holds a personal interest in the dispute;
• he or she, or his or her partner, has a family or strong personal relationship with any of the parties’ legal representatives or their attorneys;
• he or she is currently advising or assisting, on a continuing basis, any of the parties or their affiliated companies (this includes controlling, controlled or sister companies) or has any other economic or associative relationships that might jeopardise his or her independence;
• he or she is a trustee of one of the parties; and/or
• he or she has already provided advice at an earlier stage of the dispute or has given witness deposition in the same.

While no specific rule on an arbitrator’s duty relating to impartiality and independence is expressly provided by the ICCP, there is consensus in considering Articles 815(1) and Article 832(4) as providing an implicit reference to such principles. In fact, they both set the grounds on the basis of which arbitrators may be recused.

Whenever the arbitrator is a lawyer, Article 61 of the Code of Conduct of the Italian Bar Association shall apply. In particular, lawyers shall not act as arbitrators (a) if they have – or have had in the last two years – a professional relationship with one of the parties and (b) if one or more conditions listed in Article 815 of the ICCP apply.

The duty to act impartially and independently, as well as the duty of disclosure, are clearly dealt with in the arbitration rules of all main arbitral institutions. In particular, the arbitration rules of CAM, recently renewed in March 2019, provide for the detailed regulation of arbitrators’ impartiality and independence as well as grounds for the incompatibility of members of the Board/Arbitral Council/auditors or employees of the Chamber acting as arbitrators.

All arbitrators selected for appointment under the CAM arbitration rules shall provide the parties with a statement of impartiality and independence and disclose to the parties all circumstances which, to their knowledge, could give rise to a conflict of interest or cast doubts as to their impartiality or independence. Failing any objection by the parties and the Arbitral Council, the arbitrators are then appointed.

Like other relevant institutions, CAM has issued a code of ethics for arbitrators which addresses all arbitrators’ duties.

See 3.2 Arbitrability.

The competence-competence principle applies in Italy, pursuant to Articles 817 and 819 ter of the ICCP. Therefore, arbitrators have the power to rule on a party’s challenge to the tribunal’s own jurisdiction, as well as on any issues relating to the validity of the arbitration agreement. However, when an arbitration is pending, according to Article 819 ter of the ICCP, the parties are prevented from raising claims as to the validity of an arbitration agreement or as to the arbitral tribunal’s jurisdiction before the court. 

Italian law provides for clear limits within which an Italian court can deal with issues of arbitral tribunal jurisdiction; Italian courts are usually reluctant to go beyond these boundaries. Typically, issues of arbitral tribunal jurisdiction can only be brought before the courts in three circumstances:

• when a dispute subject to arbitration is brought before a court;
• when an arbitration is pending and a party challenges the validity of the arbitration agreement or the arbitral tribunal’s jurisdiction before the court; or
• when the arbitral award is challenged on grounds of jurisdiction or arbitral agreement validity.

Italian law provides a clear answer for all these cases:

• when a dispute covered by a valid arbitration agreement is brought before a court, the defendant shall raise the arbitration objection within its statement of defence, failing which the defendant is considered to have waived its right to arbitral jurisdiction with reference to that specific dispute (Article 819 ter of the ICCP);
• pursuant to Article 819 ter of the ICCP, the parties are forbidden from raising objections as to the validity of the arbitration agreement or the arbitral tribunal’s jurisdiction before a court while the arbitration is pending; and
• any lack in arbitral tribunal jurisdiction or invalidity of the arbitration agreement is a ground to challenge the award; however, any challenge on these grounds can only be heard by the court insofar as these objections were raised with the first possible defence in the arbitration proceedings. 

The same principles apply in case of negative rulings on jurisdiction.

Parties can challenge the jurisdiction of the arbitral tribunal only after an award has been rendered and insofar as the challenge has been timely raised within the arbitration proceedings.

The standard of judicial review for questions of admissibility and jurisdiction is a full review.

Italian courts pursue an arbitration-friendly approach; therefore, Italian courts are generally reluctant to allow a party to commence court proceedings in breach of a prima facie valid arbitration agreement. If court proceedings are commenced despite a valid arbitral agreement, the court will usually dismiss the claim and declare in favour of the arbitral jurisdiction. In addition, the court usually orders the plaintiff to bear the costs of the court proceedings and is also empowered, if the circumstances allow, to order the plaintiff to pay compensation to the defendant.

The general rule is that third parties are neither signatories to a contract containing an arbitration clause nor party to an arbitration agreement and are not bound to arbitrate. However, third parties can be considered bound by an arbitration agreement in cases of assignment of contracts or where there is a substantial overlap in the management chain of a group of companies.

In any event, Italian law also allows third parties to intervene in arbitration proceedings (irrespective of their nationality). However, such intervention is subject to the agreement of all parties and the consensus of the arbitral tribunal (Article 816 quinquies of the ICCP).

Special rules on joinder and third-party notice are provided for in corporate arbitrations, to allow the participation of all shareholders and other related parties in the proceedings.

According to Article 818 of the ICCP, arbitrators are not entitled to grant attachments, nor other interim measures, unless otherwise provided by law. To date, the only existing statutory exception is Article 35(5) Legislative Decree No 5/2003, which allows arbitrators on corporate matters to suspend the execution of a challenged company’s resolution.

Nevertheless, the prohibition imposed by Article 818 of the ICCP is undergoing amendments. As a consequence, under the above-mentioned reform, arbitrators might be vested with the power to issue preliminary relief and interim measures.

Until then, to partially overcome such limitation, parties may agree to provide the arbitral tribunal with the power of issuing provisional or interim measures having mere contractual effect. In this respect, it is worth mentioning that Article 26 of the CAM Rules now provides limited powers for arbitrators to issue interim measures, within the limits set out by Article 818 of the ICCP. In particular, Article 26 provides that:

“1. At request of a party, the Arbitral Tribunal may issue all urgent and provisional measures of protection, also of anticipatory nature, that are not barred by mandatory provisions applicable to the proceedings.

2. In any case, unless otherwise agreed by the parties, the Arbitral Tribunal, at the request of a party, has the power to adopt any measure of a provisional nature with binding contractual effect upon the parties.”

Also, arbitrators are now vested with the power to “order the party requesting an interim measure to provide appropriate security for costs as a condition to issue the measure”.

Although these measures are still not enforceable, since they are deemed to have a mere contractual effect, non-compliance entitles the other party to bring a court action for breach of contract.

In the absence of the arbitrators granting interim relief, the Italian courts are the sole authority entrusted with such powers. Italian courts can grant several kinds of interim or preliminary relief, such as seizures, astreintes and urgent orders in aid of evidence gathering. They may also support foreign-seated arbitrations provided that, in the absence of an arbitration agreement, the Italian courts would have had jurisdiction over the dispute. 

Italian law does not provide for the use of emergency arbitrators.

Pursuant to Article 816 septies of the ICCP, arbitrators may submit the costs of the continuation of the proceedings to the advance payment of foreseeable expenses. The amount of these expenses is usually determined by the arbitrators unless otherwise agreed by the parties. If one of the parties does not advance the requested amount within the scheduled deadline, the other party may advance all costs; otherwise, if none of the parties will provide for it, the arbitration will be discontinued and the parties will no longer be bound by the arbitration agreement.

There is no specific ban on courts granting securities for costs; however, these orders are seldom issued in practice.

Italian law governs the arbitral proceedings whenever an arbitration is seated in Italy. However, as a general principle, the parties can freely determine the rules of the arbitration procedure provided that due process is always complied with. In fact, considering that most of the provisions of the Italian arbitration law are non-mandatory, parties and, after the commencement, the arbitral tribunal are left with wide discretion with respect to the determination of the applicable rules. The principle of party autonomy is indeed enshrined in Article 816-bis(1) of the ICCP.

Also, pursuant to Article 832 of the ICCP, the parties are expressly permitted to refer to the arbitration rules of the arbitral institution of their choice.

In case of disagreement, the arbitration agreement shall prevail. In the absence of any determination on procedure by the parties, the arbitrators shall establish the applicable rules of procedure in the way they consider most appropriate.

The parties are free to determine the procedural steps to apply in the arbitration proceedings, provided they are not in breach of mandatory rules of law.

Arbitrators are subject to the following obligations:

• to perform their duties with the required professional diligence;
• to act independently and not hinder or delay the performance of their tasks;
• to render the final award timely, within the deadline specifically set for this purpose; and
• to ensure that the principle of due process and the parties’ rights to be heard are complied with during the entire arbitration proceedings.

At the same time, arbitrators enjoy ample powers as to the conduct of the proceedings, within the limits of due process and with respect to all matters of procedure where the parties have not reached an agreement (eg, the seat of arbitration or the language of the proceedings). Also, arbitrators retain full powers to manage the evidence-gathering phase, have the right to the reimbursement of their expenses and the payment of their fees, and can exercise an ample degree of discretion in allocating the arbitration costs between the parties.

There are no specific qualifications or requirements for legal representatives to appear in proceedings. Pursuant to Article 820 of the ICCP, the parties can benefit from the assistance of a legal counsel in the proceedings, whereupon a power of attorney shall be provided.

As a general rule, the parties and arbitrators to an arbitration seated in Italy have ample discretion in choosing the rules that apply to the evidence-gathering phase. In practice, even though discovery, disclosure and, to a certain extent, witness statements are not entirely familiar to Italian law, the IBA Rules on the Taking of Evidence in International Arbitration are widely known and applied (either as guidance or as governing rules).

With regard to witness testimony, Article 816 ter of the ICCP provides that witness examination can be gathered either orally (at the seat of arbitration or at the witness’s residence or office) or in writing, as per the arbitral tribunal instructions.

The same evidence rules that apply to domestic matters apply to arbitral proceedings. While the question of whether rules of evidence are a matter of substantial or procedural law is not entirely settled in the international arbitration community, under Italian law the rules of evidence are considered to be part of substantive law.

In this respect it is worth mentioning that in cases of contractual breaches, the non-breaching party (usually the claimant) only has the burden of proving the existence of the (breached) contract, while the burden of proving the non-occurrence of the claimed breach lies with the breaching party (the defendant).

The arbitral tribunal may ask the court to order the production of documents from the public administration as well as the personal attendance of witnesses for deposition.

The ICCP does not provide for the specific confidentiality of arbitral proceedings or of the relevant pleadings. Nevertheless, the parties usually enter into confidentiality agreements, and the rules of the main arbitral institutions expressly provide for such a confidentiality burden.

In addition, lawyers’ professional regulations provide for a duty of confidentiality covering all outputs from their professional practice for a certain period of time.

According to the ICCP, arbitral awards shall be delivered within 240 days from the arbitrators’ acceptance of their appointment; however, this term can be extended upon the parties’ agreement or by an order of the president of the court of the seat of arbitration. Furthermore, pursuant to Article 820 of the ICCP, the deadline for rendering the final award is de jure extended an additional 180 days in case of:

• a need to gather means of evidence or to carry out a technical expert assessment;
• the removal of arbitrators; or
• the issuance of partial or interim awards.

Any arbitral award (including potential dissenting opinions) shall be rendered in writing upon a majority vote within the deadline set by the parties for that purpose and shall include:

• the names of the arbitrators;
• the seat of arbitration;
• the names of the parties;
• the arbitration agreement;
• the parties’ requests for relief;
• a brief description of the reasoning;
• the ruling; and
• the arbitrators’ signatures bearing the relevant date.

There are no specific limits on the types of remedies that an arbitral tribunal may award, with the sole exception of preliminary or interim relief which cannot be granted by arbitrators – unless otherwise provided by the law (please refer to 6.1 Types of Relief).

The principle that “costs follow the event” applies; as a consequence, the losing party is usually ordered to bear the full costs of the proceedings. Nevertheless, arbitrators retain ample discretion in awarding costs of proceedings and are free to allocate such costs in a different manner, taking into account the parties’ behaviour during the proceedings.

Arbitral awards can be challenged on the following grounds:

• the arbitration agreement was invalid;
• the arbitrators were not appointed in the manner and form prescribed by the ICCP;
• the award was rendered by an individual with no legal capacity to act;
• the award exceeded the limits of the arbitration agreement;
• the award did not contain the reasoning, the ruling or the arbitrators’ signatures;
• the award was rendered after the relevant time limit expired;
• the procedural rules prescribed by the parties under sanction of nullity were not observed in the proceedings and the nullity was not rectified;
• the award was contrary to another earlier award, which is no longer subject to appeal, or to a previous judgment, which has the force of res judicata between the parties, provided that such award or judgment was filed in the proceedings;
• the adversarial principle was not observed in the arbitration proceedings;
• the award closed the proceedings without deciding the merits of the dispute, which should have been decided by the arbitrators;
• the award contains contradictory provisions;
• the award did not rule on any of the claims and exceptions made by the parties in accordance with the arbitration agreement; or
• the award was contrary to public order.

In addition, arbitral awards can be challenged on grounds pertaining to the law applicable to the merits of the dispute, but only if this challenge is expressly provided for by the law or by the agreement of the parties.

The award can be challenged within 90 days from service of the award or, in any case, no later than one year from the date of the last arbitrators’ signature in front of the Court of Appeal of the seat of arbitration.

The parties cannot exclude or limit their right to challenge an arbitral award before the Court of Appeal of the seat of arbitration. On the other hand, the parties have the possibility to expand the grounds of challenge to violation of law provisions, if expressly provided for in their arbitration agreement.

Italian courts apply the provisions on challenges to arbitral awards in a strict way and are generally forbidden from reviewing the merits of the dispute as decided by the arbitral award. A review of the merits of the case is performed only in very limited cases (eg, where a challenge on the merits is agreed by the parties or provided by law). The court will uphold a challenge for one or more of the following reasons:

• the award does not contain the reasoning, the final decision or the signatures of the arbitrators;
• the award was rendered after the expiry of the time limit;
• the forms prescribed by the parties under the express sanction of nullity have not been observed in the proceedings and the nullity has not been rectified;
• the award is contrary to an earlier award which is no longer subject to appeal or to a previous judgment which has the force of res judicata between the parties, provided that evidence of such an award or judgment was produced in the proceedings;
• the adversarial principle was not observed in the arbitration proceedings;
• the award did not decide the merits of the dispute; and/or
• the award contains contradictory provisions.

In these cases, the court can review and decide the merits of the dispute only if:

• the parties agreed that the court could decide on the merits of the case; or
• where one of the parties is a foreigner and the parties expressly agreed that the court shall decide on the merits of the case.

Italy ratified the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards on 31 January 1969. Italy is also party to the 1927 Geneva Convention on the Execution of Foreign Arbitral Awards, the 1965 Washington Convention on the Settlement of Investment Disputes between States and Nationals of Other States and the 1961 European Convention on International Commercial Arbitration.

Arbitral awards rendered in Italy are enforced by filing a petition, along with an original or a certified copy of the award and the arbitral agreement, to the Court of Appeal of the counterparty’s residence or to the Court of Appeal in Rome in the case of foreigners. The President of the Court of Appeal shall declare the enforceability of an award upon an ex parte evaluation of the same. Thereafter, the award can be enforced through the usual means of judicial enforcement (attachment, garnishment, etc).

Arbitral awards that have been set aside by the courts of the seat of arbitration are usually not enforced by Italian courts. However, if a proceeding for the setting aside of the award is pending, courts are free to decide on a case-by-case basis whether or not to stay the proceedings.

The sovereign immunity defence can successfully be raised at the enforcement stage in relation to all assets that the state or state entity can prove are functional to the exercise of public powers, as well as in circumstances provided for by international or bilateral conventions.

Italian courts apply a strict standard to the enforcement of foreign arbitral awards. In particular, the courts tend to consider a foreign arbitral award contrary to public policy if its ruling (and not the reasoning) is in blatant and manifest contrast with the root principles of Italian law, which constitute the domestic public policy to be assessed and interpreted in light of international public policy principles.

Italian law does not provide for class action or group arbitration. However, rules on multi-party arbitration can apply, provided that certain specific rules safeguarding the balanced constitution of the arbitral tribunal and the right of all parties to be heard are safeguarded.

Italian lawyers admitted to the Italian Bar are required to comply with the ethical principles and professional standards provided for in the Italian Lawyers’ Code of Conduct.

The ethical principles provided for in the Code of Conduct also apply to foreign lawyers practising within Italian territory (as per Article 3 of the Code of Conduct). With specific reference to arbitration, the Code of Conduct provides that lawyers dealing with arbitrators shall comply with the same duties and prohibitions as provided in dealing with court judges, such as:

• the duty not to discuss a judicial proceeding before the judge/arbitrator in charge without the presence of the counterparty’s lawyer; and
• the duty not to take advantage of any friendship, relationship or closeness with a judge/arbitrator to obtain or request favours, nor to emphasise the existence of such ties.

The Milan Chamber of Arbitration has also issued a specific Code of Ethics that all arbitrators appointed in proceedings conducted under the auspices of the Milan Chamber of Arbitration shall abide by.

There are no specific rules governing third-party funding in Italy. Nevertheless, third-party funding has been receiving increasing attention from Italian arbitration users, as costs of arbitration in the Italian jurisdiction are still higher than those borne in the context of ordinary proceedings.

The ICCP does not provide for an express rule on consolidation. Nevertheless, upon the agreement of all parties, claims brought under separate but identical arbitration clauses can in principle be brought within a single arbitration proceeding.

At the same time, in case of arbitration proceedings administered by arbitration institutions, consolidation, subject to certain conditions, may be ordered either by the institution itself before the constitution of the tribunal (eg, Article 12 CAM Rules) or by the arbitral tribunal (eg, Article 25 CAM Rules).

However, a court would not consolidate two separate arbitral proceedings, based both on the lack of rules for this provided by the ICCP as well as on the general reluctance of national courts to step into arbitration proceedings.

As a rule, third parties that are not signatories to a contract containing an arbitration clause nor parties to an arbitration agreement are not bound to arbitrate. Nevertheless, third parties can be considered to be bound by an arbitration agreement in case of an assignment of contracts or where there is a substantial overlap in the management chain of a group of companies.

Italian law allows third parties to intervene in arbitration proceedings (irrespective of their nationality). However, such intervention is subject to the agreement of all parties and the consensus of the arbitral tribunal (Article 816 quinquies of the ICCP). The above agreement is not required in the case of compulsory joinder ordered by the arbitral tribunal or joinder to support one of the parties’ arguments.