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New Italian Rules for Joint and Several Liability in Contracts and Subcontracts

June 03, 2013

By BERNADETTE ACCILI, FRANCESCA PETRONIO, FRANCESCO FLACO, & DOMENICO GIOIA

The Italian Legislator introduced and is still implementing several provisions establishing the joint and several liability between the principal, the contractor and the subcontractors for the payment of the wages and social contributions to the employees of the contractors and subcontractors as well as of the withholding tax on income from employment and VAT payments. Such provisions expose the principal to substantial risks and thus may affect the economic balance set out by the parties to a work or services contract.