With the publication in the Official Journal (Gazzetta Ufficiale), General Series No. 73 of March 28, 2025, Law No. 35 of March 14, 2025, has officially come into force. This law introduces significant amendments to Article 2407 of the Italian Civil Code, which governs the liability of the Board of Auditors (collegio sindacale) in companies.
The revised law adds a new fourth paragraph to Article 2407, establishing the following provisions:
Auditors shall carry out their duties with the professionalism and diligence required by the nature of their role. They are responsible for the accuracy of their statements and shall maintain confidentiality regarding any facts and documents they become aware of in the course of their duties.
Except in cases of willful misconduct (dolo)—even when the Board of Auditors performs legal auditing duties under Article 2409-bis, second paragraph—auditors who breach their obligations shall be liable for damages caused to the company that appointed them, as well as to its shareholders, creditors, and third parties, within the limits of a multiple of their annual compensation, according to the following levels:
- For compensation up to €10,000: 15 times the annual compensation
- For compensation from €10,001 to €50,000: 12 times the annual compensation
- For compensation exceeding €50,000: 10 times the annual compensation
Liability actions against auditors are regulated, if compatible, under Articles 2393, 2393-bis, 2394, 2394-bis, and 2395 of the Italian Civil Code.
The statute of limitations for liability actions is five years, starting from the date when the auditors’ report under Article 2429 of the Italian Civil Code is filed, referring to the fiscal year in which the damage occurred.
Key Highlights of the Reform
The most significant changes include:
- The introduction of a cap on auditor liability, with three levels based on annual compensation
- The establishment of a clear starting point for the statute of limitations, e., the filing date of the audit report for the relevant fiscal year
Although auditors remain jointly liable with company directors, the compensation for damages that they might pay cannot exceed the maximum thresholds established in the new provision of Article 2407 of Italian Civil Code.
Furthermore, the long-standing issue of the starting point for the statute of limitations for their actions has finally been resolved: from now on, the 5 years provided for by the law will start from the filing of the union report to the financial statements for the contested financial year.
It should be noted that this cap applies only to cases of negligence. Willful misconduct remains outside the scope of these limitations and may still expose auditors to full liability.