Italy's 'Cartabia Law' Transforms Arbitration Landscape, Bolstering International Appeal

A sweeping legislative overhaul, known as the 'Cartabia Law,' is fundamentally reshaping Italy's arbitration framework, aligning it with international standards and positioning the nation as a more attractive seat for resolving complex commercial disputes. The reforms grant arbitrators crucial new powers, streamline procedures, and clarify long-debated issues in corporate arbitration, signaling a deliberate move to enhance efficiency and shed the nation's reputation for judicial backlogs.

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In a significant stride towards modernizing its legal system, Italy has implemented a series of profound changes to its arbitration laws through Legislative Decree 150 of 2022, widely referred to as the "Cartabia Law." This reform addresses critical aspects of arbitration practice that practitioners had long identified as deserving of revision, from arbitrator independence to the previously absent power to grant interim relief. The overhaul aims to make arbitration in Italy faster, more effective, and more aligned with the needs of the international business community, thereby strengthening its position as a viable and competitive forum for dispute resolution.

The reforms are not merely cosmetic; they represent a fundamental re-engineering of the Italian Code of Civil Procedure (ICCP) as it pertains to arbitration. By tackling long-standing inefficiencies, the legislation seeks to increasingly insulate arbitral justice from the systemic delays of the domestic court system and elevate its practice to meet global best-in-class standards.

Empowering Arbitrators: The Landmark Introduction of Interim Measures

Perhaps the most transformative element of the Cartabia Law is the reversal of the long-standing prohibition on arbitrators granting interim measures. Previously, this limitation placed Italian arbitration law in a minority position globally and often forced parties to engage in parallel proceedings in state courts to obtain urgent relief, undermining the efficiency of the arbitral process.

Under the new Article 818(1) of the ICCP, arbitrators are now empowered to issue interim measures, a change that brings Italy in line with other major arbitration hubs. However, this power is not automatic. It is contingent upon the parties' express agreement, which can be granted in several ways: 1. Explicitly in the arbitration agreement. 2. Through a separate written agreement prior to the commencement of proceedings. 3. By reference to institutional rules that confer such power (e.g., the rules of the Chamber of Arbitration of Milan (CAM) or the ICC).

The law makes this power exclusive, meaning that once conferred upon the arbitral tribunal, state courts lose jurisdiction over interim relief. This exclusivity is crucial for preventing tactical litigation and forum shopping. As one source notes, “The arbitrators’ competence on interim measures is exclusive.”

This change has raised transitional questions, particularly for arbitration clauses drafted before the reform's effective date of March 1, 2023. A recent decision from the Tribunal of Milan (January 7, 2025) addressed this ambiguity, ruling that for an agreement signed before the reform, the parties could not have intended to grant a power that did not legally exist at the time. The court, therefore, affirmed its own jurisdiction, suggesting that the application of the new rule is not retrospective and depends on the parties' intent at the time of contracting.

Strengthening Foundations: Arbitrator Independence and Impartiality

The credibility of arbitration rests heavily on the neutrality of the arbitrators. The Cartabia Law reinforces this principle by introducing stringent mandatory disclosure requirements. Under the revised framework, each arbitrator must, upon acceptance of their appointment, provide a written declaration detailing any circumstances that could reasonably cast doubt on their independence or impartiality.

A failure to provide this declaration can have severe consequences. Parties have a 10-day window to request the removal of an arbitrator who fails to submit the declaration. More critically, if no declaration is provided and the omission is raised during the proceedings, it can serve as grounds to challenge the final award for nullity. This proactive requirement aims to prevent conflicts of interest from derailing proceedings or tainting the resulting award. As the source material emphasizes, “To strengthen these guarantees, the Reform has made it mandatory, under penalty of nullity, for each arbitrator to declare in the statement of acceptance any circumstances that could limit their independence and impartiality.”

Navigating Corporate Disputes with New Tools

Corporate arbitration, a specialized procedure for shareholder and management disputes, has also received a significant update. The reform incorporates the existing rules from the 2003 Corporate Arbitration Decree directly into the ICCP and expands the arbitrators' authority in this domain.

Previously, arbitrators in corporate cases were limited to suspending challenged corporate resolutions. Now, aligned with the broader reform on interim measures, they can be granted the power to issue a full range of interim relief, provided this authority is bestowed in the company's bylaws. This allows for more comprehensive and effective management of disputes within the arbitral forum itself.

The reform also clarifies the continued admissibility of "irregular" or "free" arbitration in the corporate context. Despite some textual changes in the new articles, the prevailing legal opinion holds that this form of arbitration—which results in a contractually binding determination rather than an enforceable award—remains a valid choice for parties, preserving flexibility in dispute resolution design.

A recent Italian Supreme Court decision (No. 8911 of April 4, 2025) provided further clarity on foreign-seated corporate arbitration. The Court held that an arbitration clause in an Italian company's bylaws providing for arbitration abroad is valid, so long as it complies with the mandatory Italian law requirement that arbitrators be appointed by a third party external to the company. The procedural aspects of the arbitration, however, would be governed by the foreign lex arbitri , demonstrating a sophisticated and pro-arbitration approach to cross-border disputes.

The Kompetenz-Kompetenz Principle Affirmed

The principle of Kompetenz-Kompetenz—the power of an arbitral tribunal to rule on its own jurisdiction—is a cornerstone of modern arbitration law. In a landmark ruling (No. 26600 of October 14, 2024), the Joint Sections of the Italian Supreme Court robustly defended this principle.

The case involved a party attempting to challenge the jurisdiction of an ICC arbitral tribunal by initiating parallel proceedings in the Italian courts to declare the arbitration clause invalid. The Supreme Court declared the recourse inadmissible, stating it was a surreptitious attempt to circumvent the arbitral process. The Court unequivocally ruled that “during the course of arbitration proceedings, no claims may be brought before the Italian domestic courts to assert the invalidity or ineffectiveness of the arbitration clause, since any related question is at this stage referred to the arbitrators.” This decision sends a powerful message that Italian courts will respect the arbitral process and refuse to entertain premature challenges to an arbitrator's jurisdiction, thereby preventing dilatory tactics and reinforcing the autonomy of arbitration.

Conclusion: A New Era for Arbitration in Italy

The Cartabia Law, supported by a series of clarifying and pro-arbitration decisions from the highest courts, represents a concerted effort by Italy to modernize its dispute resolution framework. By empowering arbitrators with the ability to grant interim relief, mandating strict impartiality disclosures, and refining the rules for specialized areas like corporate disputes, the reforms address key weaknesses and align the country with international best practices.

For legal professionals and their clients, this new landscape makes Italy a substantially more predictable, efficient, and appealing seat for international arbitration. While challenges related to the broader judicial system's efficiency remain, these legislative changes provide arbitration with greater autonomy and the necessary tools to function as a truly effective alternative to litigation. The message from Italy is clear: it is open for business and serious about becoming a leading center for international dispute resolution.