On 4 April 2025, the Italian Supreme Court of Cassation, First Civil Chamber (the “Court”), delivered Judgment No. 8911/2025 in the dispute between Ferruccio Rossi (“Rossi”) and Ferretti S.p.A. (“Ferretti”). The case presented, for the first time at cassation level, a question of significant practical importance: may the articles of association of an Italian-law company validly provide for a foreign-seated arbitration of corporate disputes? The Court had previously recognised that the question was unusually complex, carried significant precedential value, had divided commentators, and lacked a specific precedent from the Court.[1]
The Court answered yes. Italian corporate law does not require every statutory corporate arbitration involving an Italian company to be seated in Italy. A clause may select a foreign seat, but the clause must still comply with the substantive requirements imposed by the law governing the company (the “lex societatis”). The key substantive requirement was Article 34(2) of Legislative Decree No. 5 of 17 January 2003 (“Decree No. 5/2003”), under which all arbitrators had to be appointed by a person or institution external to the company, failing which the arbitration clause would be null.[2] Once that substantive requirement was satisfied, procedural rules applicable to an Italian-seated corporate arbitration could give way to the procedural law of the foreign seat (the “lex arbitri”), subject to the fundamental safeguards governing recognition of foreign awards under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”).[3]
The judgment is therefore important beyond its immediate facts. It provides a conflict-of-laws framework for separating the mandatory corporate-law features of an arbitration clause from procedural rules that follow the arbitral seat. It also rejects the proposition that a foreign award should be denied recognition merely because the foreign procedure differs from the Italian procedural model. The focus at the recognition stage remains on the statutory grounds for refusal and, where a procedural defect is alleged, on whether a concrete violation actually impaired the resisting party’s procedural rights.[4]
I. Facts
Ferretti’s articles of association contained an arbitration provision in Article 31 (the “Arbitration Clause”). The Arbitration Clause covered disputes concerning corporate relationships, including disputes involving the company, shareholders, directors, statutory auditors and liquidators. It provided for arbitration under the Rules of the International Chamber of Commerce, before three arbitrators appointed by the International Chamber of Commerce, with Geneva, Switzerland as the seat. It further stated that the arbitrators would proceed by formal arbitration and in accordance with the provisions of the Italian Civil Code, and that the award would be challengeable only in cases mandatorily provided by law.[5]
On 17 December 2014, Ferretti commenced arbitration against Rossi before the International Court of Arbitration of the International Chamber of Commerce (the “ICC Court”) pursuant to the Arbitration Clause. Ferretti sought a declaration that Rossi had breached his duties as a director and sought relief connected with agreements that Rossi had executed on Ferretti’s behalf. Rossi objected at the outset to the tribunal’s jurisdiction, arguing that the Arbitration Clause was null or ineffective and that the dispute should instead be heard by the Italian courts.[6]
The arbitral tribunal issued a partial award on 8 September 2015 confirming its jurisdiction. It later issued a final award on 30 January 2017 (the “Award”), finding that Rossi had breached his duties as a director by entering into the relevant agreements and by failing to assign performance objectives to two company officers. The tribunal did not award Ferretti damages at that stage, but it allocated two-thirds of the arbitration costs to Rossi and ordered him to reimburse Ferretti for part of the costs advanced.[7]
Ferretti then sought recognition of the Award in Italy. By decree dated 30 March 2017, the President of the Genoa Court of Appeal declared the Award effective in Italy under Article 839 of the Italian Code of Civil Procedure. Rossi opposed recognition under Article 840, but the Genoa Court of Appeal (the “Court of Appeal”) rejected his opposition by Judgment No. 649/2020, published on 9 July 2020.[8]
The Court of Appeal treated the Geneva seat as determining the Swiss lex arbitri, while Italian law governed the substantive dispute and the substantive validity of the Arbitration Clause. It held that Rossi was conflating Italian substantive requirements governing the validity of an articles-based arbitration clause with Italian procedural rules governing a domestic corporate arbitration.[9] In particular, the Court of Appeal considered Article 34(2) of Decree No. 5/2003 – requiring appointment of all arbitrators by an external person – to be a substantive validity rule, whereas the procedural regimes in Articles 35 and 36 did not govern an arbitration seated in Switzerland.[10]
Rossi appealed to the Court. His central position was that Articles 34-36 of Decree No. 5/2003 formed an indivisible and mandatory model for statutory corporate arbitration involving an Italian company. On that theory, an Italian company’s articles could not validly choose a foreign seat if doing so displaced Italian rules concerning matters such as intervention in the arbitration, the arbitrators’ decision-making obligations and the regime for challenging the award. Rossi therefore argued that the Arbitration Clause was invalid and that recognition should have been refused under Article 840(3)(1) of the Italian Code of Civil Procedure and Article V(1)(a) of the New York Convention.[11]
Several factual features narrowed the dispute. The underlying arbitration concerned an action by the company against a former director for breach of duty; it was not an action challenging the validity of a shareholders’ resolution. No third party or shareholder had sought to intervene in the arbitration. Rossi also did not identify a concrete denial of notice, an inability to present his case, unequal treatment or a lack of impartiality in the constitution or conduct of the arbitral tribunal.[12]
II. Issues
The Court was required to resolve three interrelated legal questions.[13]
- Foreign seat. May an arbitration clause contained in the articles of association of an Italian-law company validly designate a seat of arbitration outside Italy?
- Applicable mandatory rules. When the validity of such a clause is assessed under Italian law, which elements of the special Italian corporate-arbitration regime operate as substantive requirements that continue to apply in a foreign-seated arbitration, and which elements are procedural rules that ordinarily follow the lex arbitri?
- Recognition of the foreign award. Is the abstract non-application of Italian procedural rules sufficient to prevent recognition of the resulting foreign award, or must the resisting party establish a recognised ground for refusal, including an actual procedural violation where procedural unfairness is alleged?
III. Holding
The Court held that an Italian-law company may validly provide in its articles of association for a foreign-seated corporate arbitration. Neither the special corporate-arbitration provisions applicable to the dispute nor Italian private international law imposed a rule requiring the seat to be in Italy.[14]
The Court further held that the selection of a foreign seat does not remove the Arbitration Clause from the substantive requirements of the Italian lex societatis. In this case, Article 34(2) of Decree No. 5/2003 imposed a mandatory condition of validity: the power to appoint the entire arbitral tribunal had to be vested in a person or institution external to the company. Because the Arbitration Clause entrusted the appointment of all three arbitrators to the ICC, that condition was satisfied.[15]
At the same time, the Court rejected Rossi’s contention that every provision in Articles 34-36 had to be treated as an ex ante validity requirement for the Arbitration Clause. The Court distinguished substantive protections governing the clause and its effects from procedural rules governing the conduct of the arbitration. Procedural provisions applicable to an Italian-seated corporate arbitration could be displaced by the selection of a foreign lex arbitri, provided that the resulting procedure remained consistent with the fundamental procedural guarantees relevant to recognition under the New York Convention.[16]
Finally, the Court held that Rossi could not resist recognition merely by pointing to the abstract inapplicability of Italian procedural provisions. An opposition to recognition based on procedural defects requires an actual violation and a concrete and effective impairment of the resisting party’s procedural rights. Rossi had not alleged such a concrete injury. The Court therefore dismissed the appeal and upheld recognition of the Award.[17]
IV. Reasoning
1. Italian Law Does Not Impose an Italy-only Seat for Statutory Corporate Arbitration
The Court began from the text of the legislation. Articles 34-36 of Decree No. 5/2003, which applied to the case ratione temporis, contained no provision requiring the seat of a statutory corporate arbitration to be in Italy. The Court refused to infer such a prohibition from statutory silence.[18]
Instead, the Court identified Article 4(2) of Law No. 218 of 31 May 1995 (“Law No. 218/1995”) as the relevant general rule. That provision permits Italian jurisdiction to be derogated by written agreement in favour of a foreign court or foreign arbitration where the dispute concerns rights of which the parties may dispose. The Court found no basis for treating corporate arbitration as an exception to that general permission.[19]
This conclusion also fitted the policy and commercial context identified by the Court. A foreign seat may be selected for legitimate reasons: a significant foreign shareholding may favour a neutral forum; a special-purpose company created for an international investment or joint venture may wish to align its articles with the dispute-resolution mechanism in the underlying investment agreement; and related disputes may be more efficiently handled under a common arbitral framework. The Court also recognised that procedural considerations, including the selection of a preferred arbitral legal environment, can legitimately influence the choice of seat.[20]
The Court therefore rejected the proposition that legislation designed to promote corporate arbitration in Italy must necessarily have been intended to confine arbitration involving Italian companies within Italian territory. A restriction of that magnitude would have required a specific legislative basis, particularly in light of the general rule permitting derogation from Italian jurisdiction in favor of foreign arbitration.[21]
2. The Correct Method Is to Identify the Legal Function of Each Rule
Having accepted the possibility of a foreign seat, the Court turned to the more difficult question: which Italian rules continue to apply to the Arbitration Clause despite the foreign seat?
The Court rejected an all-or-nothing approach. It reasoned that, in a dispute containing foreign elements, the analysis must identify the legal field to which each issue belongs. A matter may fall within Italian corporate law, arbitration law, procedural law or contract law. The governing law can therefore differ depending on the function of the particular rule being considered.[22]
For the Arbitration Clause at issue, Italian law governed the substantive validity analysis. The clause itself required the arbitrators to act in accordance with the Italian Civil Code, and both parties agreed that Italian law governed the relevant validity inquiry. More fundamentally, the Court observed that the internal affairs of an Italian company are governed by the applicable lex societatis under Italian private international law and cannot simply be detached from that law by private agreement.[23]
The critical point, however, was that the application of Italian law to the validity of the Arbitration Clause did not mean that every Italian procedural rule became a substantive condition of validity. An arbitration agreement is a private legal act with procedural effects: it is the parties’ agreement to submit disputes to arbitrators rather than state courts. That mixed character requires attention to the function of the particular statutory rule, not the mechanical application of the entire domestic procedural model to a foreign-seated arbitration.[24]
3. The Court Separated Substantive Protections from Procedural Rules
The Court’s classification was deliberately granular. It did not treat whole articles as necessarily substantive or procedural; in some instances, different parts of the same provision performed different legal functions.[25]
On the substantive side, the Court identified rules governing the adoption, modification, scope and binding effects of an arbitration clause contained in a company’s constitutional documents. These included, among other things: the exclusion of companies accessing the risk-capital market from using this statutory mechanism; the requirement that the entire tribunal be appointed by a person external to the company; the binding effect of the clause on the company, shareholders and, where applicable, directors, liquidators and statutory auditors; the special rules for introducing or removing the clause and the withdrawal rights of absent or dissenting shareholders; and certain company-register publicity requirements.[26]
The Court regarded these rules as protecting the substantive position of persons affected by the company’s internal governance arrangements. The external-appointment rule was particularly important because an articles-based arbitration clause can bind a wider group of corporate stakeholders than the individuals who may have participated directly in drafting it. Requiring an external appointing authority protects the neutrality of tribunal constitution and the consensual legitimacy of corporate arbitration.[27]
On the procedural side, the Court identified rules concerning arbitrability in the jurisdictional sense, the fallback involvement of an Italian court if the designated external appointing authority fails to act, intervention by third parties or other shareholders, treatment of incidental non-arbitrable questions, interim measures, the criteria governing the arbitrators’ decision and the regime for challenging the award. These matters concern the conduct and supervision of the arbitral proceeding and therefore ordinarily follow the law of the seat.[28]
The Court’s analysis ultimately turned on this distinction. Article 34(2) treated the appointment of the entire arbitral tribunal by a person or institution external to the company as a mandatory condition for the validity of the arbitration clause, even where the arbitration was seated abroad. By contrast, the second sentence of Article 34(2), providing for intervention by the president of the Italian court at the company’s registered seat if the designated appointer does not act, was procedural. The Court used this example to demonstrate why Rossi’s proposed indivisible treatment of the statutory scheme could not be sustained.[29]
4. Selecting a Foreign Lex Arbitri Does Not Itself Offend Procedural Public Policy
The Court then addressed the concern that permitting a foreign seat would allow parties to evade mandatory Italian procedural safeguards. It rejected the premise that the procedural provisions in Articles 35 and 36, merely because they are mandatory for domestic corporate arbitration, automatically form part of international procedural public policy.[30]
The Court identified the fundamental procedural safeguards at a higher level of generality: the right to be heard, equality between the parties, and the impartiality and independence of the adjudicatory body, together with the broader requirements of a fair arbitral process. The choice of a foreign lex arbitri does not, in itself, compromise those principles. A recognition problem arises if the procedure actually infringes such guarantees, not simply because the foreign procedural regime is different from the Italian regime.[31]
That approach was reinforced by the New York Convention and the corresponding Italian recognition regime. Article V of the New York Convention contemplates that foreign awards will emerge from different national procedural systems and nevertheless circulate internationally. It permits refusal of recognition on specified grounds, including lack of proper notice or inability to present a case, excess of authority, and improper constitution of the tribunal or conduct of the procedure. Article 840 of the Italian Code of Civil Procedure reflects the same basic structure.[32]
In the Court’s view, those grounds supply the correct ex post control. If a foreign lex arbitri produces an actual violation of a fundamental procedural guarantee, the party resisting recognition can invoke the applicable ground for refusal. It is neither necessary nor appropriate to convert every procedural feature of the Italian domestic corporate-arbitration model into an ex ante validity requirement for every arbitration clause in the articles of an Italian company.[33]
The Court also viewed Rossi’s position as difficult to reconcile with the structure of the New York Convention. If the procedural law of the recognising state were automatically treated as a condition of validity of the arbitration agreement, awards could rarely circulate between legal systems with materially different arbitral procedures. The recognition framework instead assumes procedural diversity while preserving a defined set of safeguards against unfairness and jurisdictional excess.[34]
5. Rossi Alleged No Concrete Procedural Prejudice
The Court’s final step was case-specific. It emphasised that an opposition to recognition of a foreign award based on procedural error requires more than a hypothetical mismatch between foreign and Italian procedural rules. There must be an actual violation of the procedure that governed the arbitration and a concrete and effective impairment of the resisting party’s rights.[35]
Rossi did not make that showing. No third party had sought to intervene. The arbitration did not concern a challenge to a shareholders’ resolution, so the special Italian provisions applicable to that type of dispute were not concretely engaged. Rossi’s case was essentially that the Arbitration Clause was invalid from the outset because it made Italian procedural provisions inapplicable; he did not identify an actual procedural event in the arbitration that deprived him of a protected right.[36]
The Court also observed that the underlying directors’ liability action was not subject to exclusive Italian jurisdiction. Exclusive jurisdiction in company-law matters applies to a narrower category of disputes, such as disputes concerning the validity of a company’s constitution, dissolution or decisions of its organs. The Court considered it difficult to justify a rule that would permit jurisdiction over the type of dispute before it to be prorogated to a foreign state court while categorically prohibiting the same dispute from being referred to foreign arbitration.[37]
Finally, the Court noted that the Court of Appeal had rejected Rossi’s public-policy objection and that Rossi had not specifically challenged that part of the lower court’s judgment before the Court. That determination had therefore become final within the proceedings and could not be revived by the Court on its own initiative.[38]
V. Commentary and Practical Significance
Commentary on Judgment No. 8911/2025 has generally treated the ruling as an important step toward accommodating foreign-seated corporate arbitration for Italian companies. The decision provides greater certainty that a foreign seat is permissible where the applicable substantive safeguards are respected, while commentary has also identified practical questions that remain open, including the coordination of Italian corporate-law requirements with the foreign lex arbitri, company-register formalities, third-party intervention, and recognition of the resulting award in Italy.[39]
Accordingly, the judgment is best read as resolving the threshold question rather than as settling the entire framework. It confirms that an Italian company may choose a foreign arbitral seat, while leaving room for further debate over the law governing the arbitration agreement, the substantive or procedural characterisation of particular safeguards, and the extent to which differences between foreign arbitral procedure and Italian law may become relevant at the recognition and enforcement stage.[40]
VI. Conclusion
Judgment No. 8911/2025 is a significant decision for Italian companies, shareholders, investors and counsel structuring cross-border corporate arrangements. It confirms that the articles of an Italian-law company may validly select a foreign seat for corporate arbitration. The choice of a foreign seat is not, by itself, an evasion of Italian corporate law and does not make the arbitration clause invalid.[41]
The decision nevertheless preserves mandatory Italian corporate-law protections. The drafting exercise cannot stop at selecting a foreign institution and seat. Counsel must identify which requirements belong to the Italian lex societatis and therefore continue to govern the validity and effects of the clause. The most important requirement in this case was the external appointment of the entire tribunal, but the Court’s reasoning extends to other substantive protections concerning who may use the statutory mechanism, who is bound by the clause, how the clause is introduced or removed, and the protection and information rights of affected corporate stakeholders.[42]
Equally important, the judgment draws a clear line at the recognition stage. A party resisting enforcement cannot rely simply on the fact that a foreign arbitration did not follow Italian procedural rules. The relevant question is whether a recognised ground for refusal has been established and, where procedural unfairness is alleged, whether an actual violation caused concrete prejudice. That approach aligns the special features of Italian corporate arbitration with the international recognition framework of the New York Convention rather than treating Italian procedure as a mandatory global template.[43]
Although the Court applied Articles 34-36 of Decree No. 5/2003 because they governed the dispute ratione temporis, it expressly noted that the 2022 reform repealed those provisions and introduced substantially analogous corporate-arbitration provisions into the Italian Code of Civil Procedure, including Articles 838-bis, 838-ter and 838-quater. The judgment’s functional distinction between substantive corporate-law requirements and seat-dependent procedural rules is therefore likely to remain highly relevant when drafting and assessing foreign-seated arbitration clauses under the current statutory framework.[44]
For drafting purposes, the judgment allows an Italian company to choose a foreign seat, but it does not displace the Italian corporate-law rules that continue to apply. The clause should expressly comply with the external-appointment rule and should be drafted with the chosen foreign lex arbitri in mind, including how company-register publicity, third-party participation, interim relief and award review will operate in practice.[45]
[1] Cass., Sez. I Civ., 4 April 2025, n. 8911, pp. 10, 16. The judgment is available in the original Italian. An unofficial machine-generated English translation is also available for convenience.
[2] D.Lgs. 17 January 2003, n. 5, Art. 34(2); Cass. n. 8911/2025, pp. 40-42.
[3] Convention on the Recognition and Enforcement of Foreign Arbitral Awards, opened for signature 10 June 1958, Art. V; Cass. n. 8911/2025, pp. 42-43, 46-47.
[4] Cass. n. 8911/2025, pp. 43-46.
[5] Cass. n. 8911/2025, pp. 27-28.
[6] Cass. n. 8911/2025, pp. 2-3.
[7] Cass. n. 8911/2025, pp. 3-4.
[8] c.p.c., Arts. 839-840; App. Genova, Sez. I Civ., 9 July 2020, n. 649, pp. 6, 26.
[9] App. Genova, Sez. I Civ., 9 July 2020, n. 649, pp. 15-16.
[10] App. Genova, Sez. I Civ., 9 July 2020, n. 649, pp. 16-17.
[11] c.p.c., Art. 840(3)(1); New York Convention, Art. V(1)(a); Cass. n. 8911/2025, pp. 10-12.
[12] Cass. n. 8911/2025, pp. 7-9, 45-46.
[13] Cass. n. 8911/2025, pp. 16, 40-46.
[14] Cass. n. 8911/2025, pp. 29-34.
[15] D.Lgs. 17 January 2003, n. 5, Art. 34(2); Cass. n. 8911/2025, pp. 40-42.
[16] Cass. n. 8911/2025, pp. 37-43.
[17] Cass. n. 8911/2025, pp. 45-48.
[18] Cass. n. 8911/2025, pp. 29-30.
[19] L. 31 May 1995, n. 218, Art. 4(2); Cass. n. 8911/2025, pp. 30, 33.
[20] Cass. n. 8911/2025, pp. 16-17, 28-29.
[21] Cass. n. 8911/2025, pp. 31-33.
[22] Cass. n. 8911/2025, pp. 28-29.
[23] L. 31 May 1995, n. 218, Art. 25; Cass. n. 8911/2025, pp. 34-35.
[24] Cass. n. 8911/2025, pp. 40-41.
[25] Cass. n. 8911/2025, pp. 37-40.
[26] Cass. n. 8911/2025, pp. 37-39.
[27] Cass. n. 8911/2025, pp. 38, 40-41.
[28] Cass. n. 8911/2025, pp. 39-40.
[29] D.Lgs. 17 January 2003, n. 5, Art. 34(2); Cass. n. 8911/2025, pp. 39-42.
[30] Cass. n. 8911/2025, p. 42.
[31] Cass. n. 8911/2025, pp. 42-43.
[32] New York Convention, Art. V(1)(b)-(d); c.p.c., Art. 840(3)(2)-(4); Cass. n. 8911/2025, pp. 43-44.
[33] Cass. n. 8911/2025, pp. 43-44, 46.
[34] Cass. n. 8911/2025, p. 44.
[35] Cass. n. 8911/2025, pp. 45-46.
[36] Cass. n. 8911/2025, pp. 45-46.
[37] Cass. n. 8911/2025, pp. 45-46.
[38] Cass. n. 8911/2025, p. 44.
[39] R. Oliva, Foreign-Seated Corporate Arbitration, 14 July 2025, https://www.arbitratoinitalia.it/en/2025/07/14/foreign-seated-corporate-arbitration/ (last accessed 11 August 2026); Assonime, Il Caso 6/2025 – Arbitrato societario con sede estera, 22 July 2025, https://www.assonime.it/attivita-editoriale/caso/Pagine/Il-Caso-6_2025.aspx (last accessed 11 August 2026); Diritto Bancario, Arbitrato societario con sede all’estero: legittima la clausola statutaria, 10 April 2025, https://www.dirittobancario.it/art/arbitrato-societario-con-sede-allestero-legittima-la-clausola-statutaria/ (last accessed 11 August 2026).
[40] P. Sangalli, Corporate Arbitration with a Foreign Seat under Italian Law, 19(4) Revista Română de Arbitraj 106, pp. 108-110; L. Fumagalli, Sede estera per un arbitrato societario? Brevi osservazioni in una prospettiva di diritto internazionale privato a margine di una recente pronuncia della Corte di Cassazione, 2025(2) Giurisprudenza Arbitrale 381; A. Sardu, Recenti sviluppi in materia di arbitrato societario statutario con sede all’estero, 2025, https://www.giurisprudenzarbitrale.it/Article/Archive/index_html?ida=377&idi=-1&idn=20&idu=-1 (last accessed 11 August 2026); R. Alemanno, La Cassazione riconosce la validità della clausola compromissoria statutaria che individui all’estero la sede dell’arbitrato. Nota a Cass. 4 aprile 2025 n. 8911, 2025(3) Il Diritto Processuale Civile Italiano e Comparato 510.
[41] Cass. n. 8911/2025, pp. 33, 46-47.
[42] Cass. n. 8911/2025, pp. 37-42.
[43] New York Convention, Art. V; Cass. n. 8911/2025, pp. 43-47.
[44] D.Lgs. 10 October 2022, n. 149; Cass. n. 8911/2025, pp. 29-33, 46-47.
[45] Foreign-Seated Corporate Arbitration; Sangalli, pp. 108-110; Fumagalli, p. 381.
