Italy ready to defend 'golden powers' against EU moves, economy minister says

By Giuseppe Fonte

ROME (Reuters) -The Italian government will defend its golden powers aimed at shielding strategic assets, its economy minister said on Friday, as Brussels prepares to challenge the legislation.

Italy is among the EU countries that have made extensive use of golden power legislation to protect interests in sectors such as banking, defence and telecommunications.

Minister Giancarlo Giorgetti told reporters in Luxembourg national security was not for European institutions to judge.

"National security is the exclusive responsibility of the national government, and we intend to defend it in some way," he said at the end of a meeting between European finance ministers.

Reuters reported on Thursday the European Commission was set to act against Rome as part of a push against EU countries hampering bank consolidation in Europe.

Brussels will launch two separate legal proceedings under single market and merger rules respectively, the sources said.

The move was prompted by Italy's intervention in a proposed bank merger involving the country's second-biggest lender UniCredit, which withdrew its offer for smaller rival Banco BPM on July 22, blaming government interference.

Among several conditions for the deal to proceed, Italy had told UniCredit to halt activities in Russia by early 2026, to prevent savings collected by Banco BPM from funding Moscow's war against Ukraine. Rome kept this decree in place despite the collapse of the deal.

The EU will order Italy to withdraw the decree that set terms for UniCredit's failed bid, the sources have said, while challenging the overall golden power legislation through a separate infringment procedure.

"When the EU's remarks will arrive, We will evaluate them. I am simply saying that the Government is applying an effective law. If you want to change the law, it is up to Parliament to do so," Giorgetti said when asked about the Reuters report.

The EU Commission plans to send two separate letters to Italy by mid-November to start its move, the sources added.

If the EU rules that the conditions imposed on UniCredit are unlawful, UniCredit will be able to assess whether to seek damages from Italy.

Giorgetti, however, signalled the government was ready to challenge the proceedings in an EU court.

(Reporting by Giuseppe Fonte;Editing by Elaine Hardcastle)