FAQs - Asset managers

What kind of supervision are asset management companies subject to?

Companies providing collective asset management services are supervised by Banca d'Italia and CONSOB, within their respective remits. Banca d'Italia is responsible for supervising risk mitigation, stability, and sound and prudent management, while CONSOB is responsible for supervising the transparency and fairness of the conduct of intermediaries.

Controls are carried out with due regard for the business aspects of the supervised entities, which set their own strategies, organizational models and investment policies independently in compliance with the prudential regulatory framework.

In its supervisory role, Banca d'Italia carries out analyses and takes measures designed to promptly detect any signs of anomalies in the intermediaries' technical and organizational arrangements, and urges them to take the necessary corrective measures. It performs both off-site inspections - by collecting, processing and systematically analysing a comprehensive set of statistical, accounting and administrative data - and on-site inspections to confirm the quality and accuracy of the data provided by intermediaries and to have a better understanding of their organization and management. On-site inspections are tailored to reflect the characteristics, size and complexity of each intermediary and focus on material risks, corporate governance and internal controls.

These checks cover all operations and evaluate the solidity of organizational structures, the quality of risk management and control, the adequacy of capital to cover losses, and transparency and fairness vis-à-vis customers.

For the supervision of crypto-asset operations, please also refer to the joint note by Banca d'Italia and CONSOB published on 29 October 2024.

Is there a form to submit applications?

No, there is no standard application form. The Collective Asset Management Regulation specifies the documents to be attached, provides templates for the business plan and organizational structure report, and indicates the criteria for drafting the memorandum and articles of association for SICAVs and SICAFs.

What documents should I attach to my SGR licensing application?

The information and documents to be submitted with your licensing application are set out in the Collective Asset Management Regulation and are, as a general rule, the following:

memorandum and articles of association;
proof of payment of capital contributions, issued by the head office of the bank where the payment was made;
information on the origin of the money used to pay capital contributions;
a business plan, an organizational structure report and any other information needed to fully illustrate the operations that the company intends to carry out;
a list of entities directly or indirectly holding an interest in the share capital, indicating their respective holdings in absolute and percentage terms; for indirect holdings, companies must report the entities through which such interests are held;
evidence showing that direct and indirect qualified shareholders meet the relevant requirements;
a list of all members of the corporate bodies in charge of strategic oversight, management, and auditing, as well as the directors-general and anyone holding equivalent positions, indicating their names and general details;
the minutes of the board meeting confirming that the members of the management body meet the fit and proper requirements and that there are no grounds for incompatibility and suspension from office under Article 36 of Decree Law 201/2011 (interlocking rules);
description of the business group, including by means of charts;
if relevant, proof that the company is part of an investor-compensation scheme recognized under Article 59 of the TUF.

The documents referred to in points f) and h) must be no older than 6 months prior to the date of submission of the licensing application.

What documents should I attach to SICAV and SICAF licensing applications?

The information and documents to be submitted with the licensing application are set out in the Collective Asset Management Regulation and are, as a general rule, the following:

copies of the company's memorandum and articles of association; the corporate purpose stated in the articles of association must be exclusively 'the collective investment of the capital obtained by the offer of its own shares' for SICAVs and 'the collective investment of the capital obtained by the offer of its own shares and of the financial instruments of its equity holdings indicated in the articles of association' for SICAFs;
information on the origin of the money used to pay capital contributions;
a business plan, an organizational structure report and any other information needed to thoroughly illustrate the operations that the company intends to carry out;
a list of entities directly or indirectly holding an interest in the share capital, indicating their respective holdings in absolute and percentage terms; for indirect holdings, companies must report the entities through which such interests are held;
evidence showing that direct and indirect qualified shareholders meet the relevant requirements;
a list of all members of the corporate bodies in charge of strategic oversight, management, and auditing, as well as the general managers and anyone holding equivalent positions, providing their names and general details;
documents showing that the members of the management body meet the professionalism, integrity and independence requirements and that there are no grounds for incompatibility and suspension from office, as referred to in Article 36 of Decree-Law 201/2011;
a description of the business group, including by means of charts;
if relevant, proof that the company is part of a compensation scheme for investor protection recognized under Article 59 of the TUF.

The documents referred to in points e) and f) must be no older than 6 months prior to the date of submission of the licensing application.

For information on the simplified regime for externally managed SICAVs and SICAFs established by Law n. 21 of 5th March 2024, please refer to the specific FAQ.

What exemptions are there for sub-threshold managers of reserved AIFs?

Sub-threshold managers providing collective asset management services for reserved AIFs only are those who:

manage assets, including any assets acquired through leverage, not exceeding the €100 million threshold; or
manage assets not exceeding the €500 million threshold, provided that the AIFs do not use leverage and that the right of shareholders to redeem units or shares cannot be exercised for at least five years from the date of initial investment in each AIF.

The law provides for the following exemptions for these managers:

for the purposes of licensing, they must have a share capital of at least €50,000;
instead of a business plan, they are required to provide information to Banca d'Italia as specified in Article 5(2) of Commission Delegated Regulation (EU) 231/2013;
the rules on remuneration policies and practices shall not apply.

What are the regulatory requirements for externally managed SICAVs and SICAFs?

Following the entry into force of Law 21/2024 (Capital Markets Law), the incorporation of externally managed SICAVs and SICAFs is no longer subject to licensing by Banca d’Italia. Article 38.1 of the Consolidated Law on Finance (TUF) introduces a simplified regime under which these companies:

a) adopt the legal form of joint-stock company (società per azioni);

b) have their registered office and general management in Italy;

c) have a share capital at least equal to the minimum required under Article 2327 of the Civil Code (€50,000);

d) include in their articles of association the following exclusive corporate purposes: for SICAVs, the collective investment of assets raised through the public offering of their shares; for SICAFs, the collective investment of assets raised through the public offering of their shares and other participatory financial instruments morevover, an external manager must be appointed to carry out collective management activities for the entire pool of assets;

e) define suitable procedures to ensure continuity of management in the event of replacement of the external manager;

f) enter into agreements with the external manager to allow the company's board of directors to access all documents and information necessary to verify the correct fulfillment of the manager's obligations. These agreements must also define the timing and methods for the transmission of such documents and information;

If the designated external manager is not an asset management company (SGR), the external manager and the custodian must enter into an agreement that ensures that the custodian has access to the information needed to perform its duties, as required by the applicable legislation.

Pursuant to art. 38(6) of the TUF, the external manager is responsible for ensuring that externally managed SICAVs and SICAFs comply with all applicable provisions.

What are the specific requirements for the licensing of SISs?

Simple investment companies (SISs) are Italian AIFs formed as SICAFs which directly manage their assets and comply with all of the following requirements:

their sole corporate purpose is the direct investment of the assets collected in SMEs not listed on regulated markets which are in the testing, set-up or start-up phase;
their equity does not exceed €25 million;
they do not use leverage;
they have at least the share capital specified in Article 2327 of the Italian Civil Code (€50,000);
they must take out professional indemnity insurance covering the risks arising from their business.

SISs are subject to the same rules as SICAFs. Due to their small size and lean structure, these companies are not subject to a number of asset manager obligations, regulated by Banca d'Italia and CONSOB, including on the following: corporate governance and general organizational requirements; capital adequacy; risk mitigation; outsourcing of critical or important operational functions, services or activities; transparency and fairness of conduct. Similarly, they are not subject to the rules applicable to Italian UCITSs concerning, among other things, investment criteria and restrictions, and the prudential rules on risk mitigation and diversification.

SISs are also required to adopt an adequate governance and control system to ensure sound and prudent management and compliance with the provisions applicable to them, as well as to apply the provisions laid down by CONSOB regarding the marketing of UCITSs.

For further details on the specific requirements for SISs see the Banca d'Italy and CONSOB supervisory guidelines on Simple Investment Companys (SISs) (only in Italian).

How does Banca d'Italia assess ownership structures?

When assessing licensing applications from newly-incorporated entities, Banca d'Italia pays particular attention to the financial soundness and the quality of shareholders, in order to make sure that they are able to manage start-up risks and, in the event of a crisis, to minimize the costs associated with value destruction.

For this purpose, Banca d'Italia assesses the quality of the qualified shareholders (i.e. investors that hold at least 10 per cent of shares or voting rights, or can exercise a significant influence over the intermediary) and the financial soundness of the business plan, based on the following criteria: the good repute, ethics, professionalism and expertise of those who, as a result of acquiring a qualifying holding, will perform administrative and management functions in the intermediary; the financial soundness of the qualified shareholders; the intermediary's ability to comply with the provisions governing its business following the acquisition of a qualifying holding; the suitability of the group structure of the qualified shareholders for the purpose of effective supervision; no grounds to suspect that the acquisition is associated with money laundering or terrorism financing. The assessments are carried out in accordance with the provisions under Article 15 of the TUF, the Collective Asset Management Regulation of 19 January 2015, and Banca d'Italia Measure of 26 July 2022.

The analysis of the applicant's ownership structure does not result in a separate decision on qualifying holdings or follow the procedures laid down in the relevant legislation, but feeds into the preliminary assessments for licensing purposes.

This analysis is carried out based on the information and documents produced in accordance with Banca d'Italia Measure of 26 October 2021.

How does Banca d'Italia assess corporate governance and officers?

Banca d'Italia assesses the applicant's governance to make sure it is suitable for managing the risks to which it is exposed, that it is consistent with the company's business and size, and it is clear in the allocation of tasks among corporate bodies and in relations with shareholders.

The Bank verifies that the members of the management body comply with the requirements of good repute, fitness and independence under Ministerial Decree 468/1998. The members of the management body must also comply with the interlocking rules laid down in Decree Law 201/2011.

Intermediaries are responsible for identifying fit and proper members of the management body. Moreover, they must ensure that the appointees meet these requirements and criteria throughout their term of office.

What should be included in the business plan?

The plan should illustrate the company's business activity, its prospective business lines, the objectives pursued and the strategies to meet them, as well as any other information useful for evaluating the application, as detailed in Banca d'Italia Measure of 19 January 2015.

The plan should also provide information on how the intermediary plans to maintain financial soundness and comply with prudential regulations during the start-up phase, even if business volumes develop below expectations.

The financial statements for the first three financial years and a report on the organizational and technical structure must be attached to the business plan.

How does Banca d'Italia assess applicants' business plans?

Banca d'Italia assesses applicants' business plans and organizational structure with a view to sound and prudent management and may require changes accordingly.

To this end, it assesses the following, among others:

the consistency of information and the reliability of forecasts;
the adequacy of the plan to ensure capital, income and financial soundness, as well as its compliance with prudential requirements throughout the reference period;
the adequacy of the organizational structure and internal controls;
the consistency of strategic planning, including with the target market.

Banca d'Italia may require shareholders to commit to providing financial support to the company for business development purposes or in the event of financial distress.

What should be included in the organizational structure report?

The organizational structure report, to be drawn up in accordance with Banca d'Italia Measure of 19 January 2015, shall include at least the following:

the composition, role and functioning of corporate bodies;
the composition and role of the individual committees, if any;
a description of the business strategies and strategic planning;
a description of the investment process;
a description of how the value of shares in the funds managed is assessed;
the structure of internal control functions and the anti-money laundering function;
a description of the company’s accounting and IT systems;
information on the identification and management of conflicts of interest and remuneration policies.

With reference to the description of the internal control and risk management system, the documentation submitted must specify, for each control function:

roles, responsibilities and reporting lines;
responsibilities of function heads;
number of persons allocated to each unit;
annual plan of checks by the audit functions.

Where corporate functions (processes, services or operations) are outsourced, applicants must submit evidence that these arrangements will not prevent the intermediary from complying with legal requirements, affect customer relationships, reduce the quality of the internal control system or hinder supervision. Please refer to the specific FAQ.

What information should be provided when corporate functions are outsourced?

Intermediaries can outsource corporate functions (processes, services or operations), including core functions, provided that these arrangements do not prevent the intermediary from complying with legal requirements, affect customer relationships, reduce the quality of the internal control system or hinder supervision.

Supervisory provisions require intermediaries to adopt specific corporate policies to ensure that the outsourced functions are performed properly, the internal control system works smoothly and external providers' operations are regularly monitored. Applicants outsourcing any corporate functions are required to include the following information, in accordance with the EBA/GL/2019/02 Guidelines:

a brief description of the outsourced operations;
the names of external providers, together with a BoD assessment – for core operations only – of their suitability, both in qualitative and quantitative terms, also considering any other outsourcing contracts they may have with other intermediaries;
the corporate outsourcing policy document setting out the following basic information, in line with the principle of proportionality: i) the decision-making process for outsourcing corporate functions; ii) the basic content of outsourcing contracts and the expected service levels for outsourced operations; iii) how outsourced functions are monitored; iv) internal information flows intended to ensure the full understanding and governance of the risk factors associated with outsourced functions; v) contingency plans for providers’ failure to perform outsourced operations properly;
a summary of the outsourcing contract for core operations specifying the parties’ main rights and obligations; the expected service levels, in objective and measurable terms, and the service performance metrics; any conflicts of interest and the corresponding mitigation measures; the contract duration and renewal terms, as well as the mutual obligation provisions for contract termination;
a description of the measures taken, including organizational measures, to ensure ongoing monitoring of outsourced operations. The document should also specify the internal resources designated as outsourcing managers, whose professional profiles should be in line with this position.

Intermediaries using outsourced services are required to monitor the risks arising from outsourcing decisions, keep control of and remain responsible for outsourced operations, and retain the technical and management skills required to backsource them. It is understood that corporate boards and the heads of outsourced functions will remain responsible for the overall performance of those operations.

Can Banca d'Italia run specific checks on applicants as part of the licensing process?

Banca d'Italia may order an assessment of the overall viability of an applicant's corporate structure and check the existence and the amount of its capital. For this purpose, it may use its own inspectors or request a third-party appraisal. Depending on the applicant's line of business, the Bank may highlight additional points to be assessed and recorded in the assessment report.

When does Banca d'Italia remove an SGR, a SICAV or a SICAF from the asset manager register?

Banca d'Italia shall remove an asset manager from the register in cases where its licence is withdrawn or has lapsed.

Intermediaries wishing to renounce their licence shall notify Banca d'Italia accordingly. After consulting Consob, Banca d'Italia shall remove them from the register within 90 days of receipt of the notification.

What should an asset management company do to extend its activity to crypto-assets under the MiCA Regulation?

Where an asset management company (SGR) is authorized to provide portfolio management and ancillary services in accordance with Directive 2009/65/EC on certain UCITS or Directive 2011/61/EC on Alternative Fund Managers, it may also provide the following equivalent crypto-asset services:

reception and transmission of orders for crypto-assets on behalf of clients (deemed equivalent to the reception and transmission of orders in relation to financial instruments);
provision of advice on crypto-assets (deemed equivalent to investment advice);
portfolio management for crypto-assets (deemed equivalent to investment portfolio management services).

To this end, the SGR shall notify Banca d'Italia of the information required by the MiCA Regulation at least 40 working days before providing such services for the first time. Information already submitted during the previous licensing process and still valid may be omitted, provided the SGR submits a declaration confirming that it remains unchanged and does not require updating.

Moreover, in line with the MiCA Regulation, the prudential requirements for crypto-asset service providers do not apply to asset management companies, which remain subject to their relevant legislation.

For more details, please refer to the operational guidelines published on 13 September 2024 and the dedicated page for MiCAR intermediaries.

What steps must an asset manager take to engage in credit servicing in Italy?

Under the Consolidated Law on Banking (TUB), the rules governing the purchase and servicing of bad loans do not apply when these activities are carried out by asset managers – as defined in Article 1.1.q-bis of Legislative Decree 58/1998 – on behalf of undertakings for collective investment in transferable securities (UCITSs) referred to in Article 1.1.k of the same decree, with respect to loans granted or purchased by those undertakings. Therefore, an asset manager intending to service bad loans on behalf of UCITSs is not required to obtain any additional authorization.

For further information, please refer to the dedicated page on credit servicers.

Under what conditions does a licence lapse?

Banca d'Italia shall automatically declare that a company's licence has lapsed and shall remove it from the register if it has not started asset management operations within one year of licensing or if, having commenced asset management operations, it fails to engage in them for more than six months.

As for SICAVs and SICAFs, failure to set up the company or to pay up the initial subscribed capital within the 30-day time limit shall result in the licence lapsing.

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