Italy edging closer to ‘golden power’ as CONSOB says Vivendi controls TIM

The Italian government is edging closer towards activating its ‘golden power’ to intervene in industries judged to be of strategic importance after Italian markets regulator CONSOB last week ruled that Vivendi did, after all, exercise effective control over Telecom Italia (TIM).

CONSOB ruled last week that Vivendi, which holds a 23.94% stake in TIM, “exercises de facto control of TIM pursuant to art. 2359 of the Italian Civil Code and art. 93 of the Consolidated Law on Finance, as well as the rules on related parties”.

The decision came as a blow to Vivendi, which has maintained that its stake does not allow it to exercise control over the telco but that the pair are coordinating in specific, defined areas.

TIM said that it would “take all appropriate legal actions in order to defend its interests, and is confident its conduct is correct and its arguments are strong.”

Italian industry minister Carlo Calenda was reported by Reuters as saying at the weekend that the government was moving towards activating its golden power, without specifically identifying Vivendi.

Calenda said at the weekend that international economic relations were gong through a period of hardening and that it was necessary for Italy to defend its interests.

The government is investigating whether Vivendi contravened an obligation to notify if it planned to take eventual effective control of the company.

If it finds against Vivendi, the government could impose a huge fine on Vivendi and impose new restrictions on the French media company.

According to Reuters, Vivendi made a gesture towards the government on Friday by notifying it of its participation in TIM to comply with a decree concerning foreign investments in strategic enterprises, while continuing to fight the application of the decree in this specific case.

The move concerns a 2012 decree that specifies investing companies must notify the government about stakes in strategic enterprises within 10 days, under threat of incurring penalties if it fails to do so.

Officialis are set to meet on September 25 to decide whether a penalty should be imposed.