Third Sector Entities
Introduction
Legislative Decree No. 117/2017 (the so-called Third Sector Code, or “TSC”) introduced and regulated Third Sector Entities (“TSE”), which now enjoy a more articulated and comprehensive discipline than that traditionally reserved for non-profit entities in Book I of the Italian Civil Code.
Third Sector Entities: definition and main features
Third Sector Entities are defined as 'voluntary organizations, associations for social promotion, philanthropic entities, social enterprises, including social cooperatives, association networks, mutual aid societies, associations, whether recognized or unrecognized, foundations and other private entities other than companies set up for the pursuit of non-profit purposes, the purpose of which is to promote the development of the economy and the environment, and to promote the development of the economy and the environment, non-profit, civic, solidarity and socially useful purposes through the performance, exclusively or principally, of one or more activities of general interest in the form of voluntary action or the free provision of money, goods or services, or mutuality or the production or exchange of goods or services, and registered in the single national register of the Third Sector' (Art. 4, par. 1, Legislative Decree No. 117/2017).
The definition is therefore articulated, as it first includes a list of entities typologically identified ('voluntary organizations, associations for social promotion, philanthropic entities, social enterprises, including social cooperatives, association networks, mutual aid societies). These are the so-called 'named types' of entities, some of which were already subject to special regulations which, in some cases, were repealed and replaced with a new one (as precisely in the case of social enterprises: see Article 40, paragraph 1, TSC; Article 17, paragraph 3, Decree 112/2017) and, in other cases (as for mutual aid societies), remained governed by the original regulations. Other entities, such as 'associative networks' and philanthropic entities, on the other hand, have been regulated ex novo. The regulation then goes on to provide a general definition to include in the ETS the recognized and unrecognized associations, foundations and other private entities other than companies that meet the following requirements:
- pursuit, on a non-profit basis, of civic, solidarity and socially useful purposes;
- carrying out, exclusively or principally, one or more of the activities of general interest typified in Article 5;
- the general interest activity may be carried out indifferently in a free, mutual or entrepreneurial form;
- registration in the Single National Register of the Third Sector.
The enterprise in the Third Sector
The Third Sector Code introduced a general legal regime, applicable to all TSEs regardless of the specific legal form adopted from time to time by the individual entity and largely modelled on the rules laid down in the Civil Code for corporations. In this sense, see for instance Art. 23 et seq. Code of the Third Sector, which subject Third Sector associations and foundations to governance rules largely similar to those of companies.
Moreover, the Third Sector Code expressly recognizes the possibility that non-profit organizations may carry out business activities either exclusively or principally or only secondarily. In the first case, it will be the same activity of general interest that will be carried out in an entrepreneurial form, but on a non-profit basis and for civic, solidarity or socially useful purposes. If the entity carries out its activity exclusively or principally in the form of a commercial enterprise:
- is obliged to register not only in the Single National Register of the Third Sector but also in the Business Register (Art. 11 CTS);
- is obliged to keep civil-law accounting records (Art. 13, para. 4, CTS);
- is obliged to draw up the annual balance sheet in the form of the balance sheet of a stock corporation and consequently to file it with the business register (Art. 13, para. 5, CTS).
Alternatively, TSEs may only carry out business activities on a secondary basis, as a way of obtaining financial resources to invest in carrying out their main non-profit activity (Art. 6 CTS). In that case then the business activity will be aimed at generating a profit, which is, however, ancillary and instrumental to the general interest activity.
References
D. Foresta, Sugli enti del terzo settore. Tipi e funzione nell’articolazione del registro unico, in Nuove leggi civ. comm., 2022, p. 1461 et seq.;
C. Ibba, Codice del terzo settore e diritto societario, in Riv. soc., 2019, p. 64 et seq.;
G. Marasà, La ‘commercializzazione’ degli enti del libro I del codice civile, in Riv. dir. civ., 2023, p. 210 et seq.;
G. Marasà, Appunti sui requisiti di qualificazione degli enti del Terzo settore: attività, finalità, forme organizzative e pubblicità, in Nuove leggi civ. comm., 2018, p. 675 et seq.;
G. Meruzzi, Complemento di diritto commerciale, 1, Impresa, società in generale e società di persone, 2° ed., Egea, Milano, 2019, p. 36 et seq.;
G. Ponzanelli, Enti del terzo settore: un primo commento, 2017, in I quaderni della fondazione italiana del notariato, available at: https://elibrary.fondazionenotariato.it/risultati.asp?q=Enti%20del%20terzo%20settore%3A%20un%20primo%20commento;
E. Quadri, Il terzo settore tra diritto speciale e diritto generale, in Nuova giur. civ. comm., 2018, p. 708 et seq.
Websites
The updated version of the Third Sector Code can be found here: https://www.normattiva.it/atto/caricaDettaglioAtto?atto.dataPubblicazioneGazzetta=2017-08-02&atto.codiceRedazionale=17G00128&atto.articolo.numero=0&atto.articolo.sottoArticolo=1&atto.articolo.sottoArticolo1=10&qId=4200499a-cfce-483e-84e2-703cb6f79c7e&tabID=0.08454119083690514&title=lbl.dettaglioAtto
Further information and links are also available at the following site: https://italianonprofit.it/risorse/definizioni/enti-terzo-settore/
