Italy's project finance rules have an awkward legal
foundation. If investors and sponsors can gain the benefit of
project bond technology, radical reforms are needed
The recent placement of project bonds to finance Belgium's
A11 motorway made Italian lawyers wonder when it will be possible
to structure a similar transaction under our national project bond
laws. The asset class was introduced in Italy two years ago, with
the aim of financing infrastructures and public interest services
through bond markets rather relying solely on bank lending.
Italian project bonds feature a number of benefits for issuers
and investors alike. First, they are applicable to a vast variety
of infrastructure projects including motorways, electricity
transportation, IT networks, gas storage and transportation.
Second, project bonds issued before June 26 2015 are tax efficient,
having the same tax treatment as Italian government bonds in
respect of interest received by the bondholders.
