June 8, 2020 Ecosystem

The measures of the “Relaunch” Decree to strengthen the Italian start-up ecosystem

With Decree-Law n. 34 dated 19 May 2020 (the “Decreto Rilancio” or “Relaunch Decree“), the Italian Government implemented several measures to support the Italian economy, hardly affected by Covid-19’s emergency.

Some measures aim to strengthen the Italian start-up ecosystem, and in general Italian innovation and venture capital industry:

  • € 100 million of additional resources are allocated to the Smart&Start Italy program for 2020. Smart&Start Italy is the main national financing tool which provides subsidised loans to innovative start-ups.
  • € 200 million of additional resources are allocated to the Venture Capital Support Fund for the year 2020. The Venture Capital Support Fund invests in innovative start-up and SMEs through the subscription of equity financial instruments or convertible bonds, as well as other debt financial instruments with the possibility for the investor of repaying the contribution made.

For more info, read: National Innovation Fund: a hope for the Italian venture capital industry?

  • € 10 million of non-refundable aid is available ed in order to fund non-repayable grants to innovative start-ups for the acquisition of the services provided by incubators, accelerators, innovation hubs, business angels and other public or private entities operating in the venture capital sector (the so called “Voucher Smart Money”).
  • € 200 million within the SME Guarantee Fund (Fondo di Garanzia per le PMI) are reserved for innovative start-ups. SME Guarantee Fund is the major national aid instrument for enterprises, with the mission to support access to credit by SMEs through direct guarantees to banks or counter-guarantees to Confidi, the mutual credit guarantee consortia.
  • Innovative start-ups are now assimilated to universities and research institutes in order to encourage research and development activities, also to cope with the Covid-19 emergency. This allows companies partnering with innovative start-ups to get a tax credit on the contract, pursuant to Law n. 160 of 27 December 2019, for 150% of its amount.
  • 1 year extension of the registration of innovative start-ups within the special section of the Italian Business Register (from 5 years to 6 years from the date of establishment).

For more info, read: Innovative start-ups and SMEs: definition for the Italian law

  • For individuals only, a tax deduction of 50% of the amount invested in the share capital of one or more innovative start-ups or SMEs, either directly or through collective investments schemes (UCITS), which mainly invest in innovative start-ups or SMEs. The maximum deductible investment cannot exceed, in each tax period, the amount of € 100,000, and each investment must be maintained for at least three years. This measure applies exclusively to innovative start-ups and SMEs registered in the respective special sections of the Italian Business Register.
  • The creation of an Alternative PIR (PIR Alternativi), a new type of long-term savings plans (PIR), in order to encourage investments, both in venture capital and in debt capital, in the real economy and, in particular, into unlisted companies.
  • The creation of the Technology Transfer Fund (Fondo per il Trasferimento Tecnologico), with an allowance of € 500 million for 2020. The fund will promote the collaboration of public and private entities in the implementation of innovation and spin-off projects. The fund will also make investments, through indirect participation in venture capital and/or debt capital of innovative start-ups or SMEs.
  • The reduction of the thresholds in order to get an Investors Visa for Italy, which is a 2-year visa for non-EU citizens who choose to invest in strategic assets for Italy’s economy and society. The investment thresholds are reduced from € 1 million to € 500,000 for investments in an Italian limited company, and, from € 500,000 to € 250,000 for investments in registered innovative start-ups.
  • A First Playable Fund is established by the MISE with an initial funding of € 4 million for the year 2020. This fund supports videogames creation and prototypes production, through the granting of non-refundable aids, recognised to the extent of 50% of eligible expenditure, and for an amount ranging from € 10,000 to 200,000 per single prototype.