Hybrid Financial Instruments under Italian Tax Law: The Case of Participating Financial Instruments
Abstract
Participating financial instruments (strumenti finanziari partecipativi, PFIs), introduced into Italian corporate law by the 2003 reform, are hybrid instruments combining equity-like and debt-like features. Despite their structural flexibility, the absence of a detailed statutory framework has long limited their use, while enabling innovative applications in restructurings, private equity, venture capital and incentive schemes. This article analyses PFIs under Italian law, focusing on their tax qualification for issuers and investors. Particular attention is paid to interpretative issues raised by the tax authorities, treaty classification of PFI proceeds and conversion mechanisms.
Fields of Study & Subjects
Corporate Governance and Law
Global Financial Regulation and Crises
Corporate Insolvency and Governance
Publication details
- Journal / source
- European Taxation
- Publisher
- IBFD
- Volume
- 66
- Issue
- 2/3
- Publication date
- 16 February 2026
- Language
- EN