Open a Business in Italy: GEOS Guide for Global Expansion

This article is apart of our weekly series associated with the The Global Subsidiary Index. The series is designed to help businesses identify the best countries for establishing a subsidiary based on key operational factors. GEOS provides a data-driven ranking of jurisdictions worldwide, assessing across 40+ criteria to bring you insights into global expansion opportunities.

Each country on the index is scored on an overall score out of 100, with each individual criterion out of 5 or 10. Higher scores indicate a more favorable environment for businesses. By leveraging these insights, companies can make informed decisions on where to establish a legal presence.

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Setting up a business in Italy looks stronger now that the tech scene is expanding fast. Startups pulled in $768 million in the first half of 2025, already beating the full-year total from 2020. Investor confidence is rising fast.

Funding is spreading across automation, cybersecurity, clean energy, and more. Health tech has reached $126 million, fintech sits at $91.6 million, and enterprise software funding has almost doubled since 2021. Italy’s ecosystem is getting stronger and more diverse.

This momentum matches Europe’s push for tech independence and fresh EU innovation funding. Italy is using that boost to position itself as a key link between Southern Europe, the Mediterranean, and global innovation hubs.

With companies like Aindo, Cubbit, and Satispay gaining global attention, the opportunity is clear. This guide breaks down what you need to know about expanding into Italy and how GEOS helps make the process easier from day one.

Why Should You Expand to Italy?

Setting up a business in Italy delivers plenty of upside. You get a mature economy, strong consumer spending, and access to the EU. You also get slow admin, strict labor rules, and higher hiring costs. The GEOS score of 58.8 fits that mix well.

Their strong local presence and established networks are important for new entrants to understand when entering the Italian market. For those looking to start a business in Italy as a foreigner, understanding how the system works and leaning on local expertise can make a real difference.

A Gateway to Europe’s Consumer and Industrial Powerhouse

Italy’s GDP per capita sits around €40k, which signals real buying power. This supports the 8/10 score and makes Italy a good option if your business targets mid- to high-value markets. Why it helps:

• Strong consumer demand
• Large B2B spending base
• Stable, diversified economy

Most Italian companies are small or medium-sized enterprises, often family-owned, and are active in sectors like manufacturing, fashion, and engineering. Their strong local presence and established networks are important for new entrants to understand when entering the Italian market.

Industry diversity earns 5/5. Italy leads in manufacturing, fashion, engineering, machinery, and luxury goods. This keeps the economy resilient even when global conditions wobble.

Ownership and Tax Environment

Italy allows full foreign ownership in almost all sectors, which fits the 8/10 score for openness. That’s a big advantage if you’re planning to run a business in Italy as a foreigner. The new UBO register strengthens transparency, but it adds one more compliance step. Any ownership change must be reported within 30 days, so you need tight internal tracking.

The Italian Tax Agency is the official authority responsible for issuing tax identification numbers and regulating tax compliance for businesses and self-employed individuals in Italy. Certain company types in Italy require a minimum share capital to be deposited during the incorporation process. Taxes land at 6/10. The core load is:

• 24% IRES
• ~3.9% IRAP (varies by region)

Corporations are required to pay corporate taxes as part of their legal and financial obligations.

In addition to IRES and IRAP, businesses must also consider other business taxes such as VAT, property tax, and miscellaneous taxes that may apply when setting up and running a company in Italy.

Not the cheapest, but competitive in the EU. Incentives can bring the effective rate down if you’re reinvesting in fixed assets or priority sectors. The Italian government has implemented streamlined legal requirements and international trade policies to support foreign entrepreneurs and investment.

Where Things Get Harder

Employment law complexity earns 2/10 for a reason. Italy protects employees strongly, which affects anyone planning to run a business in Italy. There’s no at-will employment, and collective agreements set most of the real rules on pay, hours, and benefits. In practice, you deal with:

• Termination requires clear justification
• Standard workweek sits around 40 hours
• Overtime is restricted and more expensive
• Unions have meaningful influence
• Minimum wages come from collective bargaining, not statute

It is a legal requirement for employers to follow specific procedures and maintain proper documentation when hiring or terminating employees.

Recent reforms bring small improvements. The new rules on prolonged absence give employers more clarity. Updated probation periods for fixed-term contracts are easier to manage. Smart-working notifications tighten remote-work compliance. These tweaks help, but the system stays employer-heavy on process.

Setup and Timing

Incorporation is not the hardest part. A notary can move things quickly. The slower phase comes afterward. Registrations for taxes, social security, and the Chamber of Commerce extend the process.

To register a new company in Italy, you must complete several steps: drafting the articles of association with a notary, registering the new company with the tax authorities, and passing compliance checks with the Chamber of Commerce. Typical timeline:

• 2–3 months from decision → full operational compliance

Italy works best for companies ready to commit. You get a strong market, a skilled workforce, and access to the EU. But you also take on strict labor rules, higher admin demands, and a longer setup process. The 58.8 score captures that balance well: Italy has real upside, but you need patience, structure, and solid local guidance to unlock it.

Tax & Regulatory Environment

Italy’s tax system is clear on paper but demanding in practice. That aligns with the tax and accounting score of 6/10. IFRS alignment helps, but the mix of multiple tax bases and frequent updates makes planning harder for any business in Italy.

Understanding Italian law is essential for navigating tax and regulatory requirements, as it governs business registration, taxation, and legal compliance. For sole proprietorships and freelancers in Italy, there is no distinction between personal and professional income, and taxation is applied to the individual’s total income.

The filing culture is strict, so companies need solid internal controls from day one. Larger entities also deal with statutory audits, heavier documentation, and tighter scrutiny on restructurings and transfer pricing.

Structure of Business Taxes

Italy’s corporate rate looks straightforward, yet the corporate tax rate score of 6/10 reflects how quickly the burden shifts once you factor in IRAP. IRES taxes worldwide income for resident companies, while IRAP focuses on regional value creation.

For sole proprietors and freelancers, business revenue is generally taxed as personal income, while professional income is subject to specific tax rules depending on the individual’s status.

In addition to IRES and IRAP, sales tax is another key component of the Italian tax system, applying to both individuals and companies as part of the broader tax registration process. Your final bill depends on:

• Where you place people and core functions
• How labour costs sit across regions
• Whether you qualify for incentives

Regions like Lombardy and Emilia-Romagna offer R&D tax credits reaching 50%, which explains the local expert insight and why many investors cluster operations there.

Compliance Rhythm and Risk

Compliance reporting is steady and unforgiving. And the compliance reporting score of 3/5 matches the intensity of recurring filings.

You deal with quarterly VAT, annual IRES and IRAP, payroll and withholding, and now Global Minimum Tax filings for in-scope groups. The tax agency is responsible for monitoring and enforcing tax compliance, overseeing filings, and ensuring businesses meet their tax obligations. Penalties tightened in late 2024, so missing deadlines gets expensive fast. This pushes companies to:

• Plan cash flow around advance payments
• Keep clean data for offsets and cross-checks
• Use self-disclosure early when issues appear

Large groups can use cooperative compliance and the Tax Control Framework to reduce penalties and shorten assessment windows—if their tax processes are mature enough to support it.

Pillar Two and GMT Obligations

Italy now checks whether entities meet global minimum effective tax rates. That means more work even for companies already running clean. The new GMT returns require detailed IIR, UTPR, and QDMTT data, and the deadlines stack on top of everything you already file when doing business in Italy.

Certain financial transactions may also trigger additional tax reporting or compliance requirements under these new rules. You also submit “nil” returns when no top-up tax applies. For many groups, this turns manual reporting into a system-level upgrade.

Governance, UBOs, and Enforcement Culture

Foreign ownership is welcome, which aligns with the openness to foreign UBOs score of 8/10, but transparency is non-negotiable. The UBO register and strict 30-day update rule mean ownership changes require immediate attention. Authorities actively monitor:

• Extraordinary transactions
• Cross-border flows relying on reduced withholding
• VAT-heavy activity, especially where fraud risk exists

When registering a business or updating ownership information in Italy, it is essential to comply with the key legal requirements, including company registration, obtaining a tax identification number, and securing all necessary permits in accordance with Italian law. Advance rulings help de-risk complicated structures before implementation.

Data Protection and Privacy

On data, you deal with GDPR plus a privacy supervisor who takes its job seriously. Italy enforces GDPR with real intensity, which matches the data management laws score of 4/5. 

The Garante expects detailed DPIAs, clear retention policies, and careful handling of employee data. Global policies usually need local adjustments because Italian interpretations can be stricter. In practice, companies:

• Build DPIAs into HR and customer-data projects
• Track consent and monitoring rules closely
• Align documentation with Italy’s Privacy Code

Why Local Advisers Matter

Italy rewards well-advised investors. A skilled commercialista helps you connect national rules, regional taxes, and incentives into one picture. They also help prevent missed filings, manage GMT obligations, and interpret how new rules work in real life, not just on paper.

With solid support, the 6/10 and 3/5 scores feel manageable. Without it, the admin load, penalties, and audits stack up fast. Certain tax positions and financial transactions may also trigger extra reporting under Italy’s Pillar Two framework, which adds another layer for anyone doing business in Italy.

Working with local experts who understand the Italian business ecosystem is essential for navigating registration, legal, and bureaucratic requirements efficiently.

Incorporation & Compliance Essentials

Choosing the right business structure is the first real fork in the road when starting a business in Italy. Each option shapes liability, taxes, and compliance, so the structure you pick defines how the company operates from day one.

Sole proprietorships sit at the simplest end. A sole trader runs the business as an individual, with no separation between personal and business assets. They’re taxed on total income and remain personally responsible for debts. It’s fast and flexible, but the lack of protection can be a drawback.

Partnerships move you one level up. A general partnership (SNC) gives all partners ownership and unlimited liability, and the company name must include a partner’s name plus the SNC acronym.

A limited partnership (SAS) splits responsibilities:

• General partners manage operations and carry unlimited liability
• Limited partners invest but stay out of daily management, with liability capped at their contribution

This setup works for shared businesses but still puts meaningful risk on general partners.

Corporations offer a different level of protection because they exist as separate legal entities. A joint stock company (SpA) requires minimum share capital and structured governance, while private corporations follow similar rules with limited liability and formal oversight. These formats protect owners but involve stricter compliance from day one.

This is why most foreign investors choose an S.r.l. It provides limited liability, predictable governance, and a cleaner fit with international reporting requirements. Italy also offers the simplified S.r.l. (SRLS) — a lighter, low-cost version intended to help new founders get started with:

• Minimum share capital from €1 to €9,999
• A simplified deed of incorporation
• Fewer setup costs and easier onboarding

Together, these structures give investors a wide range of options, but the S.r.l. remains the most practical balance of protection, cost, and compliance for new entrants.

How Long Setup Really Takes

The formal act of incorporation is quick, but the real timeline stretches to around 2–3 months, which is reflected in the company registration timeline score.

For an incorporated business, documentation such as the articles of association and memorandum of association must be submitted, and registration is overseen by the notary and the Chamber of Commerce. The notary, tax code processing, and Chamber of Commerce review all add time. Delays often come from:

• Document inconsistencies
• Apostille and translation issues
• Questions about bylaws or ATECO activity codes

Everything moves, but it moves on Italian administrative time. That’s why anyone doing business in Italy benefits from tight preparation and clear documentation.

Directors and Identification

Italy doesn’t restrict who can be a director, which keeps things flexible for multinational groups. Limited liability companies (SRLs) in Italy can be established by one or more owners, allowing for a flexible ownership structure that accommodates either a single owner or multiple owners.

Still, every director needs a codice fiscale, and this requirement drives the resident director score of 3/5. You can’t sign deeds, open bank accounts, or move filings forward until those tax IDs are in place. Common holdups include:

• Slow issuance of the codice fiscale for non-Italian residents
• Missing ID pages or mismatched name spellings
• Delays coordinating with consulates or embassies

Handling the Paperwork for the Italian Business Register

Italy still leans heavily on original documents. That’s why the original paperwork score sits at 2/5. You’ll need:

• Notarized articles
• Apostilled corporate records
• Certified translations for foreign documents

Additionally, registering your business with the Italian Business Register is essential for legal and administrative recognition, as it is the official registry managed by the Chamber of Commerce. Registration is also accompanied by obtaining a tax code from the Italian Revenue Agency, which is required for all legal and financial operations.

Any mismatch, dates, names, or authorizations can pause everything until corrected.

Registered Office Requirements for a Limited Liability Company

A local address is mandatory from day one, which explains the registered address score of 4/5. It anchors:

• Tax registrations
• Banking compliance
• Business Register filings
• Official correspondence

Additionally, you must register your address with the local municipality to obtain necessary permits and ensure compliance with local regulations.

Many foreign companies start with a domiciliation service, then relocate once operations grow.

In-Person and Notary Requirements

Most notaries still expect directors or authorized representatives to appear in person. This shapes the in-person travel score of 2/5, since power-of-attorney arrangements work but aren’t always accepted without extra checks. Typical steps at the notary include:

• Signing the incorporation deed
• Confirming share capital contributions
• Verifying powers of representation
• Approving bylaws and activity descriptions

Why the Notary Matters

Every incorporation runs through a Public Notary, and their review determines whether the process moves quickly or slows down. Most delays come from the Chamber of Commerce asking for changes to bylaws, sector codes, or activity descriptions. These checks are routine, but they still add time for anyone doing business in Italy.

That’s why alignment matters. When the notary, the parent company, and local advisers stay in sync, the file moves forward with far fewer surprises.

Workforce & Employment Considerations

Italy offers strong talent, but hiring comes with structure. The rules around employment, pay, and social security are detailed, and understanding them early helps you plan with fewer surprises.

Employers must register with the National Institute for Social Security Payments to ensure compliance with national social security regulations. Companies planning to hire foreign staff, especially non-EU or non-EFTA workers, must comply with Italian employment regulations, obtain the necessary work permits, and consider cultural aspects involved in the process.

Employers are legally required to make social security payments for their employees as part of compliance with Italian labour laws.

Employment Law Complexity

Italian labour law is one of the most protective in Europe, which gives the system a 2/10 complexity score. Procedures are formal, timelines matter, and employers must document each step. Contracts follow defined formats, and dismissals require clear justification. It is essential for employers to comply with Italian laws to avoid legal and financial risks. A few features drive the score:

• Strict rules for notice and termination
• Mandatory written contracts
• Heavy emphasis on documentation

Employee-Friendliness and Dismissals

Once someone is hired, the framework leans heavily toward employee protection. Italy earns a 2/5 score for employee-friendliness, mainly because severance (TFR) accrues every month and reinstatement is still possible in certain cases. These rules raise exit costs and push employers to manage performance more tightly for anyone doing business in Italy.

• TFR severance grows throughout employment
• Reinstatement risk in sensitive cases
• Detailed disciplinary procedures

Employer Payroll Contributions

Payroll contributions are a major cost driver. Employers usually pay 30–35% of gross salary, which explains the 1/5 score for payroll burden. INPS (the National Social Security Institute) receives the bulk of contributions, and employers are required to register with the National Social Security Institute (INPS) to comply with social security obligations for their employees. Additional funds are tied to industry, role, or seniority. Costs rise due to:

• High INPS rates
• Sector-specific social funds
• Extra obligations for executives

Pension Management

Italy’s pension structure is complex, earning a 1/5 score for pension simplicity. You navigate a mix of state pensions, complementary schemes, and role-based funds. Contribution caps differ across employment types, and self-employed workers fall under separate regimes. Employers deal with:

• Mandatory INPS payments
• Additional pension funds for executives
• Different contribution rules for self-employed professionals
• The requirement to provide occupational accident insurance as part of employee protection obligations

Union Strength and Collective Agreements

Union influence is strong, and collective bargaining coverage is close to universal. This gives Italy a 1/5 score for union flexibility. National collective agreements (CCNL) set most of the working conditions you must follow, from minimum pay to job classifications. Company-level adjustments are possible but limited. CCNLs determine:

• Base salary levels
• Standard working hours
• Overtime, allowances, and benefits
• Job grades and progression paths

Local Expert Insight

Local experts consistently highlight how powerful CCNLs are in shaping the real cost of employment. They override many company-level decisions and create a baseline you must follow from day one.

Getting the right CCNL helps avoid misclassification issues, payroll mistakes, and disputes. When you combine these agreements with high employer contributions and strong employee protections, the overall scores fit the reality of operating in Italy.

Talent Availability & Salaries

Italy gives you access to a large, skilled workforce, but hiring conditions vary by sector and geography. Anyone planning to do business in Italy must also consider immigration rules. Hiring foreign staff, especially from outside the EU or EFTA, requires work permits and strict compliance with Italian labor laws.

The business type you choose will influence the skills and talent required, as different business types have varying operational and regulatory needs.

Salaries stay competitive for Western Europe, yet social charges raise the total cost of each hire. Understanding these dynamics helps you decide where to source talent and how to structure compensation.

Overall Talent Landscape

Italy ranks well for professional depth, which supports a 6/10 difficulty-of-recruiting score. There’s plenty of talent. The difficulty shows up when everyone wants the same specialists.

Tech roles, advanced manufacturing, and specialist functions can take longer to fill, especially in major cities where demand is concentrated. The labour market also shows clear structural patterns:

• Over 25.5 million people active in 2023
• Employment rate rising but still below EU averages
• High concentration of workers in micro-companies
• Strong presence in manufacturing, retail, construction, hospitality, and technical services

The type of business activity significantly influences the demand for specific skills and talent, as different sectors require specialized expertise to meet regulatory and operational needs.

The job vacancy rate sits at 2.3%, close to the EU average, signalling steady but manageable hiring pressure.

Sales & Marketing Talent

Sales and marketing talent is plentiful, but geography matters. Italy earns a 3/5 score here because most experienced candidates cluster in Milan, Turin, and Rome. These markets support modern sales operations, B2B demand generation, and customer-facing roles, but expect competition and higher salary expectations in these cities.

Developer and Tech Talent

Tech hiring continues to improve, reflected in a 4/5 score for developer availability. Milan and Bologna have emerged as the country’s strongest tech hubs, supported by growing startup ecosystems and university pipelines.

Italy’s strategic location within the European Union and its supportive environment make it especially attractive to international entrepreneurs looking to establish or expand tech businesses. You can find:

• Software engineers and data professionals
• Cybersecurity specialists
• Product and engineering talent tied to enterprise software, manufacturing tech, and green-energy systems

Tech growth is also driven by rising investment activity. In early 2025 alone, Italian startups raised €655 million, outpacing 2020’s full-year total. HealthTech, FinTech, and EnergyTech are leading the trend, pulling stronger engineering talent into the north.

Salary Benchmarking and Total Cost

On salary alone, Italy sits mid-range for Western Europe. That supports the 5/10 salary benchmarking score. But employers feel the real cost once social charges are added. Those contributions often push total compensation 30–40% higher than base pay, which matters for anyone doing business in Italy.

Hiring in the north, particularly Milan and Bologna, brings higher expectations. Costs can run 30-40% above what you’d see in Naples or Bari. This north–south divide influences not only salary bands but also the maturity of local talent pools.

Local Expert Insight

Local advisers note that Italy’s best talent follows economic gravity. High-value sectors and international employers cluster in the north, and salaries rise accordingly. 

Cities like Milan pull tech, marketing, finance, and product talent from across the country, while the south remains more cost-efficient but less specialized. Companies that build hybrid or distributed teams often mix both regions to balance cost and capability.

Financial & Banking Considerations

Italy gives investors a solid financial environment to work with. The banking system is mature, fintech adoption is growing, and most services meet EU standards.

Businesses in Italy must navigate a mature financial system and comply with local banking regulations to ensure smooth financial operations.

When opening a corporate bank account, Italian banks require specific documentation, such as company registration papers and identification for directors, and often mandate in-person verification as part of their procedures. At the same time, foreign-owned companies face slower onboarding, heavier KYC checks, and procedural steps that still rely on in-person verification.

Financial Infrastructure

Italy scores 5/5 for financial infrastructure because its banking system is stable, well-regulated, and integrated with the broader EU financial market. Business transactions are essential for maintaining financial operations and compliance, making the banking system a critical foundation for legitimate business activities.

Fintech activity continues to grow, helped by higher investment flows and stronger startup momentum. Even with the broader economy slowing to 0.4% growth in 2025, financial services remain reliable and accessible. Key strengths include:

• A wide network of commercial banks and digital banking providers
• Strong regulatory oversight under the Bank of Italy
• Increasing fintech adoption supported by private investment

These features give companies predictable access to payments, credit, and treasury services.

Budget Expectations and Operating Costs

Italy earns a 6/10 score for average budget because operating costs fall between northern EU capitals and lower-cost eastern markets. That balance matters for anyone doing business in Italy. Office space, professional services, and utilities stay manageable, but inflation trends and regional differences still shape your real spending.

Operating costs and minimum share capital requirements can vary significantly depending on the business type and sector.

For certain business types or sectors in Italy, there may be a minimum investment requirement to meet legal or regulatory standards, especially when specific licenses or approvals are needed. Economic forecasts point to:

• Moderate inflation (1.7% in 2025, dipping in 2026)
• Steady reductions in the government deficit
• A debt ratio stabilizing near 137% of GDP

Certain business types, such as limited companies or joint stock companies, require a minimum share capital to be deposited as part of the incorporation process.

These trends suggest a predictable cost environment but limited room for large fiscal incentives outside RRF-funded programs.

KYC Requirements and Corporate Bank Account Onboarding

Italy’s KYC environment is thorough, which results in a 3/5 score. Banks follow strict anti-money-laundering rules, require detailed corporate records, and often insist on in-person checks. Directors usually need to appear physically, and banks review bylaws, shareholder structures, and sector codes before approval.

As part of the onboarding process, opening a bank account is a mandatory step for company registration in Italy. Every business in Italy is required to set up a business bank account, or corporate bank account, to handle company finances, deposit share capital, and comply with Italian legal requirements.

The business bank account is essential for separating personal and business finances, supporting transparency, and ensuring all transactions meet regulatory standards. Banks must comply with Italy’s AML rules, which reflect EU directives. Obliged entities include:

• Financial institutions
• Notaries
• Commercial lawyers
• Auditors and tax consultants
• Real estate agents
• Dealers in precious goods (for transactions over €15,000)

KYC oversight sits across multiple authorities, including the Bank of Italy’s Financial Intelligence Unit, IVASS, and CONSOB, depending on the industry.

Local Expert Insight

Local experts note that account opening is often the slowest part of the setup process. Timelines vary widely, from a few thousand euros in banking fees for simpler structures to much higher costs for cross-border or multi-director setups. 

Notaries can coordinate with banks to speed up due diligence, but the final activation almost always requires an in-person visit. Foreign-owned companies should expect onboarding to take longer than in countries with fully digital verification systems.

Immigration & Work Permits

Italy offers flexible mobility for EU nationals, but non-EU hiring requires more structure. Non-EU citizens who wish to start or operate a business in Italy must obtain a business visa, which involves meeting specific requirements, submitting necessary documents, and following the application process set by Italian authorities.

For entrepreneurs, freelancers, and investors, business visas are an alternative route to enter Italy for business purposes, with specific requirements, durations, and eligibility criteria.

Foreign investors have several options for entering the Italian market, including establishing a subsidiary, branch, or representative office.

The system blends quotas, sponsorship rules, and residency steps, which gives Italy a 3/5 immigration complexity score. With the right planning, companies can bring in talent, but timelines depend heavily on annual quotas and regional workloads.

A foreign parent company can set up a branch or representative office in Italy, with the parent company retaining legal responsibility for the Italian operations.

A representative office allows foreign companies to establish a local presence in Italy for non-commercial activities such as market research or liaison functions, without engaging in direct business operations.

Work Permits for Non-EU Employees

Non-EU workers follow a formal process under the Decreto Flussi, the quota system that opens each year. Employers must secure authorization before the worker enters Italy. Once approved, the worker applies for a visa abroad and then obtains a residence permit within eight days of arrival. Key steps include:

• Employer requests a work authorization at the local One-Stop-Shop (Sportello Unico)
• Consulate issues the visa once authorization is granted
• Worker enters Italy and applies for a residence permit at the same One-Stop-Shop
• Permit validity aligns with the employment contract (one year for fixed-term, two years for permanent roles)

For entrepreneurs, freelancers, and investors, business visas are an alternative route to enter Italy for business purposes, with specific requirements, durations, and eligibility criteria.

Italy also requires documentation on housing, return travel, and the employment contract itself. Renewal is possible if the worker continues to meet entry requirements.

Rights and Mobility of Permit Holders

Once in Italy, workers gain a set of rights tied to their residence permit. Anyone doing business in Italy should know how these rules shape hiring, retention, and long-term planning. Permit holders can switch employers, access unemployment benefits if they qualify, and move into self-employment when they meet the legal criteria.

A valid passport is required when applying for a residence permit. It confirms identity and proves legal entry.

They also enjoy rights around mobility and family support, including:

• The ability to change employers without restarting the entire process
• Eligibility for unemployment benefits if the worker meets legal requirements
• Options to shift into self-employment when qualifications allow
• Family reunification for workers with a one-year permit and the right income and housing conditions

Long-term residence becomes available after five years of legal, continuous stay. Applicants must show stable income, clean criminal records, and suitable accommodation. This path gives workers more security and helps employers plan for longer team stability.

EU vs. Non-EU Pathways

EU nationals can work freely without any additional permits. As part of the European Union, Italy offers business mobility and market access across all EU member states, making it easier for entrepreneurs and investors to operate within a large single market.

That creates a sharp contrast with non-EU hiring, which depends on quota availability, employer sponsorship, and consular processing. This gap explains much of Italy’s 3/5 score—one path is fully streamlined, while the other depends on an annual government decree.

Local Expert Insight

Experts warn that timelines vary widely by region. Some prefectures process authorizations quickly, while others move slowly due to backlogs. 

Residence permits also require in-person biometrics, adding an extra scheduling step. For smoother onboarding, employers often plan early and coordinate with immigration lawyers or local consultants who understand regional differences.

Unique Italy Expansion Insights

Italy offers real advantages for global companies, but the way the system works on the ground can surprise first-time entrants. For foreign entrepreneurs, there are specific steps and legal requirements to follow, along with unique advantages when setting up a business in Italy. These insights help you understand the quirks that shape timelines, decisions, and daily operations.

Certain sectors, such as food service, require specialized licenses and permits to operate legally in Italy, so it is important to research sector-specific compliance before launching your business.

Understanding Italian business culture—including relationship-based decision-making, hierarchical structures, and communication preferences like face-to-face meetings—is essential for successful business expansion.

Public Notary Centrality: Notaries oversee all incorporations and play a quasi-governmental role in legal verification.

Every incorporation passes through a notary. They validate bylaws, confirm share capital, and verify director identities. It is also essential to engage with the local chamber of commerce to register the business and obtain necessary permits. When documents are clean, things move quickly. When bylaws or ATECO codes need edits, delays follow.

Regional Variation: Regulations and incentives differ across Italy’s 20 regions.

Italy works as one market, but each region comes with its own cost structure and support programs.

• Northern regions like Lombardy and Emilia-Romagna offer faster processing and stronger incentives • Southern regions have lower payroll costs but slower administration • Regional IRAP differences can shift your overall tax burden

Permitted business activities and regulatory requirements can also vary by region, so it’s important to check local rules for your specific operations.

Your location choice affects timelines, incentives, and long-term costs.

Digitalization Drive: The SPID (Digital ID) and PEC (certified email) systems are required for filings and compliance.

SPID unlocks government portals, while PEC is your official mailbox for all regulatory communication.

• All notices, approvals, and reminders land in PEC
• Notaries and banks expect both active early
• Missing PEC alerts can create real compliance risks

Digital tools sit at the center of Italy’s modern regulatory framework.

Cultural Nuance: Relationship-based decision-making is central to successful partnerships. In-person meetings remain vital.

Face-to-face conversations still solve issues faster than email. A short meeting with a notary, regional official, or bank officer can clear obstacles that would slow foreign companies down.

How GEOS Simplifies Your Expansion into Italy

Expanding into Italy takes coordination across notaries, tax offices, banks, and regional authorities. GEOS pulls everything into one managed process so your setup stays predictable and controlled.

GEOS handles the full setup, including notary coordination, registry filings, SPID and PEC activation, tax registration, and ongoing compliance.

• Filing packages arrive complete and accurate
• Stakeholders stay aligned early to reduce delays
• PEC notices and deadlines stay monitored
• Entity upkeep runs clean across all regions

This keeps foreign investors out of the administrative weeds.

AI-Powered Global Expansion Support

Compliance moves fast in Italy, and staying ahead matters. Geovanna helps track deadlines, filings, PEC notices, and regulatory changes so you’re never reacting at the last minute.

Is Italy the Right Fit for Your Business?

Italy brings strong infrastructure, advanced industries, and strategic EU market access. It also comes with structured employment rules and detailed administration. Companies that prepare for both usually gain more value over time. With a GEOS Global Subsidiary Index Score of 58.8, the country can be a strong fit for long-term growth.

📩 Contact GEOS for a customized expansion strategy!

This article does not constitute legal advice.