Financial, Swap Agreement, Upfront Financing, Local Authorities, Court of Cassation, Sec. Un., Judgment no. 8770 of 12/05/2020

 

TUEL, Legislative Decree no. 267 of 2000, arts. 42, paragraph 2, lett. i and 48, paragraph 2.

 

SWAP AGREEMENT – STIPULATION BY LOCAL AUTHORITIES – AUTHORIZATION OF THE MUNICIPAL COUNCIL – NEED – FOUNDATION

 

The Civil Civil Sections, deciding on a matter of maximum importance, stated that the authorization of the conclusion of a swap contract by the Italian Municipalities, especially if of the type with upfront financing, but also in all those cases in which the its negotiation, however, translates into the extinction of the previous underlying loan relationships or even their maintenance in life, but with significant modifications, must be given, under penalty of nullity, by the City Council pursuant to art. 42, paragraph 2, lett. i), TUEL pursuant to Legislative Decree no. 267 of 2000, not being able to assimilate to a simple debt management act of the local authority for the purpose of reducing the financial burdens inherent to it, which can be adopted by the city council by virtue of its residual management competence pursuant to art. 48, paragraph 2 of the same consolidated text “.

 

Source Supreme Court of Cassation