Italian energy and infrastructure newsletter

The latest legislative, regulatory and case law developments in the energy and infrastructures sector with specific focus on public procurement, planning and construction, environment, and regulatory authorities’ resolutions.

Laws and regulations

• Noise pollution – Legislative Decree No. 42 of February 17, 2017, in force since April 19, 2017: This new decree amends and supplements Legislative Decree No. 194/2005 on the management of environmental noise and Law No. 447/1995 on noise pollution to align Italian law with European law. It regulates the professional services of the ‘acoustic technical agent’ and it obliges Municipalities to carry out an acoustic mapping of their territory. Among others, wind farms have been added to the list of ‘fixed sound sources’ which must be subject to assessment.
• White certificates – Decree of the Ministry for Economic Development dated January 11, 2017, in force since April 4, 2017: In addition to defining the new national energy saving targets for the period from 2017 to 2020 (i.e. up to 11,9 million tonnes of oil equivalent of primary energy), this new decree identifies the subjects and the projects entitled to be admitted to the incentive mechanism, the assessment and certification methods for the savings, and updates provisions relating to oversight of the implementation of the projects in receipt of white certificates and the relevant fines.
• GSE’s guidelines for transfer of titles: In May 2017 GSE (i.e. the state-owned company which promotes and supports renewable energy sources in Italy) published new guidelines regulating the procedures necessary to transfer the agreements for the granting of feed-in tariffs to renewable energy plants, net metering systems, as well as guarantee of origin certificates and white certificates.

Case law

• Supreme Court, judgement No. 9967 of April 20, 2017 – False declarations determining access to the incentives: The Supreme Court dismissed the appeal filed by GSE against the Council of State’s judgment No. 2006/2016 under which the GSE argued a lack of jurisdiction and misuse of powers and, so, confirmed judgement No. 2006/2016, whereby the Council of State ruled that false declarations regarding the European origin of photovoltaic modules cannot cause the loss of the incentive tariff, but they may justify only the loss of the ‘made in EU’ premium.
• Regional Administrative Court of Lazio, judgement No. 5077 of May 2, 2017 – Unlawful exclusion from incentives for ten years: Following the Constitutional Court’s judgment No. 51 of March 10, 2017 which declared unconstitutional of Article 23, paragraph 3 and Article 43, paragraph 1 of Legislative Decree No. 28/2011 due to misuse of power, the Court of Lazio has annulled the exclusion for 10 years from the incentives provided under the Conto Energia mechanism to photovoltaic plants.
• Constitutional Court, judgement No. 75 of April 12, 2017 – Activity of mixing waste: it is not forbidden but it must be authorised: The Court has declared unconstitutional Article 49 of Law No. 221 of 28 December 2015 which exempted from the requirement for authorisation the activity of mixing dangerous waste having the same risk characteristics and the activity of mixing non-hazardous waste.

Laws and regulations

Legislative Decree No. 56 of May 5, 2017 supplementing and amending provisions of Legislative Decree No. 50 of April 18, 2016 (known as Correttivo Appalti), in force since May 20, 2017.

• Dutch auction: Contracting authorities may award tenders to the bidder offering the lowest price, if the value of the works is up to EUR 2 million and the contract will be awarded through ordinary procedures and based on the executive project (progetto esecutivo).
• Subcontract: Subcontracting is allowed for contracts up to the maximum of the 30 per cent of the original contract price. For contracts having a value equal to, or higher than, the European thresholds (e.g. around EUR 5,2 million for works contracts) and for contracts regarding activities exposed to the risk of mafia infiltrations, in order to subcontract, bidders are required to specify in their offers the name of three main subcontractors.
• Design and construction contracts: Design and construction contracts (so called appalti integrati) are prohibited, save for highly-technical contracts, cultural heritage and maintenance works. The prohibition on the award of design and construction contracts does not apply to final projects (progetti definitivi) approved by April 19, 2017, provided that the corresponding calls for tender are published by May 20, 2018.
• ‘SOA’ certificates: In order to demonstrate that the requirements to obtain the so called ‘SOA’ certificates have been met (i.e. the certificates required in Italy for submitting tenders for public works contracts), bidders may choose the best years of operation in the lasts ten years (while, for contracts having a value higher than EUR 20 million, they may choose the best five years in the last ten years prior to the publication of the tender).
• Advance payment: The amount to be paid to the contractor within 15 days from the effective start of works shall be calculated as a percentage of the value of the awarded contract, and not on the estimated value. The advance payment remains subject to the issue of a bank or insurance guarantee, having a maximum guaranteed amount equal to the advance payment, increased by the legal interest rate applied to the period necessary to recover the advance payment according to the time-table for completion of the works.
• Certificates of payment: Contracting authorities shall issue certificates of payment no later than 45 days from the approval of the ‘notice of progress of the work’ (so called stati avanzamenti lavori). This is a measure to take action against arrears by the public administration to pay for works.
• Members of the tender boards: The official register of the tender’s commissioners (Albo nazionale dei commissari di gara) held by the Anti-Corruption Authority (ANAC) is established on a national basis (and not a regional basis), so as to safeguard the independence of the members of the tender boards. ANAC may select the members of the tender boards also from among those who work internally within the relevant contracting authorities in case of service and supply contracts with an highly technical nature (including the president of the ANAC), of service and supply contracts with a lower value than the European thresholds, and for works with an amount lower than EUR 1 million.
• Company rating: ANAC manages the company rating system under which it grants the bidders, upon their request, a certificate confirming their professional standing and reputation. The issue of such certificate is not a requirement for the bidders to participate to the tenders, but the contracting authorities may reward the bidders having the company rating certificate with additional scores when assessing their offers.
• Private negotiation: The minimum number of entities to be invited to participate in private negotiation has been increased for both works with an amount in the range between EUR 40,000 and EUR 150,000 (to 10 entities), and for those with an amount in the range between EUR 150,000 and EUR 1 million (to 15 entities).
• Public private partnership: The maximum percentage of public contributions to projects funded by private equity has been increased from 30 per cent to 49 per cent, in an apparent contradiction with the criteria for risk allocation aimed at reducing participation of public administrations.
• Amendments without deemed-consent procedure: The provision which imposed a requirement on ANAC to answer any request for opinion on amendments of works within a 30-day term (otherwise consent is deemed) has been cancelled so as to avoid a disproportionate increase in positive opinions due to the expiry of this time limit.
• General Contractor: The ability to award contracts to general contractors is limited to big projects. The contracting authorities cannot award contracts with an amount equal to, or lower than, EUR 100 million to general contractors.
• Manpower and H&S: Labour costs must be identified in the project when fixing the tender starting price, while the health and safety costs must be deducted from the contract price and are not subject to the Dutch auction.
• Urgent contracts: In the event of extreme urgency, when there is the pressing need to ensure the timely performance of the contract, the bidders may self-certify that they have met all the requirements necessary to be admitted to the tender, but the contracting authorities will not pay the price (in whole or in part) without having successfully verified compliance with such requirements.
• Motorways: Expired motorway concessions shall be awarded through public tenders, and their extension is forbidden. However, it may be possible to award such concessions through the ‘in-house’ scheme. Contracting authorities cannot award expired and expiring motorway concessions through the ‘project financing’ scheme.
• ANAC pre-litigation opinions: In line with the observations raised by the Council of State, the provision of law which, on the one hand, empowered ANAC to force the contracting authorities to amend the tender documents it deemed unlawful and, on the other hand, sanctioned those contracting authorities which failed to comply with ANAC’s opinions, has been cancelled.

• Council of State, Section V, judgement No. 2444 of May 24, 2017 – Halved statutory term to challenge exclusions from tenders: Appeals for the annulment of awarding measures and the appeals against exclusion measures must be filed within a 30-day statutory term.
• Council of State, Section VI, judgement No. 2337 of May 17, 2017 – No monetary fine in case of failure to comply with the demolition order when the building is seized: The owner of a building that has been built without the required building permit and which is also subject to criminal seizure cannot be obliged to pay any fine if it fails to comply with the demolition order issued by the Municipality.