EN
ITThe power of attorney relates to the powers of representation held by the agent, that is, the person appointed by the business owner to manage the entire commercial enterprise, a branch office or a specific division.
The power of attorney relates to the powers of representation held by the agent, that is, the person appointed by the business owner to manage the entire commercial enterprise, a branch office or a specific division.
However, a power of attorney conferring a specific role is not the same as a standard power of attorney. The prerequisite is the conferral of a specific role, that is, the assignment to an individual of a role in the running of the business or one of its divisions. The power of attorney sets out the powers of representation and any restrictions, whilst registration in the Companies Register is particularly important in order to make such restrictions enforceable against third parties.
Who is an ‘institore’ under the Civil Code?
Article 2203 of the Civil Code defines a ‘managing agent’ as a person appointed by the owner to manage a commercial enterprise.
The preposition may refer to:
- the entire company;
- a branch office;
- a specific branch of the company.
The authorised signatory therefore occupies a different position from that of someone who is simply granted the power to sign a specific contract. He or she is entrusted with a permanent role in the organisation and conduct of the business for which he or she is responsible.
The role of an agent does not necessarily correspond to that of an employee. An employment relationship may constitute the internal relationship with the company, but it does not in itself constitute the prerequisite for being classified as an agent.
A power of attorney and a proxy are not the same thing
This distinction is important.
The preposition refers to the role assigned to the person within the organisation of the business. It is the preposition ‘in the running of the business, at the head office or at a branch’ that designates the person as an agent.
The power of attorney, on the other hand, relates to powers of representation and allows, in particular, for the imposition of any restrictions on the powers granted to the agent by law.
It is therefore incorrect to regard a power of attorney as a mere document which, regardless of the specific function assigned to it, transforms any attorney-in-fact into an agent.
Can several agents act independently?
Yes. Article 2203 of the Civil Code also expressly governs the situation where there are several agents.
As a general rule, they may act separately; therefore, each may exercise their powers independently, unless otherwise specified in the power of attorney.
What powers does the agent have?
The agent’s power of representation is extensive, but not unlimited.
Article 2204 of the Civil Code provides that he may carry out all acts relating to the running of the business over which he is in charge, subject to the restrictions set out in the power of attorney.
In simple terms, ‘relevant documents’ refers to documents relating to the business activities and management of the company or the part of the business entrusted to the agent.
The law does not provide an exhaustive list of permitted actions. To determine whether a particular act falls within its powers, it is therefore necessary to examine the relationship between that action, the activity carried out and the scope of the authority.
Depending on the specific circumstances, acts such as entering into contracts with customers and suppliers, and other transactions necessary for the running of the business, may fall within the scope of the authority to act on behalf of the company.
This does not mean that the agent is free to carry out any act without restriction. Both the limits laid down directly by law and any limits contained in the power of attorney must be taken into account.
The power of legal representation
The agent also has the power to represent the principal in legal proceedings.
Article 2204 of the Civil Code provides that he may appear in court, either as the claimant or as the defendant, in respect of obligations arising from acts carried out in the course of the business over which he is in charge.
It is therefore not a matter of general legal representation in any dispute concerning the business owner. The authority is linked to the business activities entrusted to the agent.
The obligations of the agent
Article 2205 of the Civil Code also imposes specific obligations on the agent.
In respect of the company or branch office for which he is responsible, he is required, together with the business owner, to comply with the provisions relating to registration in the Companies Register and the keeping of accounting records.
This factor, too, helps to explain why his position differs from that of a mere solicitor tasked with carrying out individual acts.
Can a trustee sell or mortgage property?
The law lays down a specific restriction on property.
Article 2204 of the Civil Code provides that an agent may not dispose of or mortgage the principal’s property, unless expressly authorised to do so.
The general power to carry out acts relating to the conduct of the business is therefore not, in itself, sufficient to authorise the sale of, or the creation of a mortgage on, the principal’s property.
Express authorisation is required in order to confer these powers.
The legislation makes specific reference to the sale and the mortgage. Where a transaction involving a property is carried out through different legal instruments, it is necessary to verify the nature of the instrument, the scope of the powers conferred and the required formalities.
For further information on documents relating to property, please refer to the section on property transfers.
Institore, solicitor and Attorney General or special prosecutor: the differences
The role of the ‘institore’ must not be confused with that of the agent governed by Article 2209 of the Civil Code.
The managing director is responsible for the running of the business, a branch office or a division. The company agent, on the other hand, whilst being able to carry out certain acts relating to the running of the business on the basis of an ongoing relationship, is not responsible for its management in the same way.
There is also a distinction between a general power of attorney and a special power of attorney in the context of ordinary representation.
| Figure or instrument | Main function | Scope of Powers |
|---|---|---|
| Institore | operation of the undertaking, a secondary establishment or a branch |
The difference therefore does not depend solely on the number of transactions the agent is authorised to carry out. What matters most in classifying a person as an agent is their appointment to manage the business or a division thereof.
For further information on the characteristics of ordinary powers of attorney, please refer to the guide on notarial powers of attorney.
Registration of the power of attorney in the Companies Register
Advertising is governed by Article 2206 of the Civil Code.
The power of attorney, bearing the principal’s authenticated signature, must be filed with the relevant office for entry in the Companies Register.
The registration of a power of attorney plays an important role in dealings with third parties, as it makes any restrictions on the agent’s powers publicly known.
What happens if the power of attorney is not registered?
In the absence of such a specification, the agent’s authority is deemed to be general.
The restrictions set out in the power of attorney cannot be invoked against third parties, unless it can be proved that they were aware of them at the time the transaction was concluded.
An example will help to clarify how it works.
If the power of attorney stipulates that the agent may not enter into contracts exceeding a certain financial threshold, but this restriction is not made public through registration, the limit may not be enforceable against a third party who was unaware of it.
Registration with the Companies Register is therefore not merely a formal procedure, but has a practical impact on the enforceability against third parties of the restrictions imposed by the principal.
How to amend or revoke a power of attorney
The powers of the agent may be subsequently amended, and the power of attorney may be revoked.
Article 2207 of the Civil Code provides that documents by which a power of attorney is subsequently restricted or revoked must be filed for entry in the Companies Register.
This rule also applies where the original power of attorney had not been published.
Unless the power of attorney is registered, any subsequent restriction or revocation of the power of attorney shall not be enforceable against third parties, unless it can be shown that they were aware of it at the time the transaction was concluded.
The termination or amendment of powers must therefore not be dealt with solely in the context of internal company relations. It is also necessary to take into account the implications for third parties.
When the agent is personally liable
When carrying out a transaction on behalf of the company, the agent must make it clear that they are acting on behalf of the principal.
Article 2208 of the Civil Code provides that the agent is personally liable for the obligation if he fails to inform the third party that he is acting on behalf of the principal.
If the act relates to the conduct of the business for which he is responsible, the third party may nevertheless bring proceedings against the principal as well.
It is therefore important to distinguish between the liability arising from the way in which the agent presents themselves in dealings with third parties and the obligations arising from the internal relationship with the business owner or the company.
When does the notary get involved?
The notary is involved in formalising the power of attorney and in defining the powers that must be set out in the deed.
Article 2206 of the Civil Code stipulates that a power of attorney bearing the principal’s notarised signature must be filed for entry in the Companies Register.
The notary’s involvement therefore makes it possible to identify the signatory, authenticate their signature and draw up a deed which precisely identifies the company or the relevant division thereof and the powers granted to the authorised representative.
Correct wording is particularly important when it is necessary to:
- to set quantitative or qualitative limits on powers;
- to coordinate the powers of several agents;
- provide that certain acts are to be performed jointly;
- expressly confer powers relating to property transactions;
- co-ordinate representation with the company’s organisation.
The notary does not act as an agent and does not manage the business. Their role is to ensure that the deed is drawn up correctly and, where necessary, to handle any further notarial deeds that the representative will need to execute.
The role of the notary in relation to property deeds
The verification of powers becomes particularly important when the agent is required to carry out property transactions.
As we have seen, Article 2204 of the Civil Code stipulates that the agent may not dispose of or mortgage the principal’s property without express authorisation.
When an authorised representative is involved in a property transaction, the notary therefore also verifies that they are authorised to act on behalf of the company and the actual scope of the powers conferred upon them.
It is therefore important for companies and businesses to set out in advance which transactions the representative will be required to carry out and which powers are to be set out in the instrument.
The firm provides detailed information on powers of attorney, delegations of authority, representation and other legal requirements on the page dedicated to notarial services for businesses and company law.
How much does a power of attorney cost?
There is no single cost that applies to every case.
The cost depends on the structure of the deed, the scope and complexity of the powers to be regulated, the presence of any restrictions, and the necessary formalities.
A document intended to govern multiple agents, complex powers of attorney or specific authorisations relating to corporate or property transactions requires a different assessment to that of a simpler situation.
To find out about the documentation, the necessary procedures and the costs involved, it is therefore advisable to assess in advance the nature of the business and the powers that need to be granted.
Power of attorney: who to contact
Before granting a general power of attorney, it is important to define precisely the role that the person is to fulfil, the area of the business for which they will be responsible, and the powers they will be authorised to exercise in dealings with third parties.
The Doria Saglietti Scerbo Notarial Practice assists businesses and companies in drawing up powers of attorney and fulfilling the obligations associated with representation.
Padua Head Office: Corso del Popolo, 8/C – 35131 Padua | Tel. 049 655 080
- Vigonza Office: Via Bachelet, 5 – 35010 Vigonza (PD) | Tel. 049 628 807
- Grantorto Office: Via Umberto I, 55/2 – 35010 Grantorto (PD) | Tel. 049 655 080
You can email us at info@studionotariledbs.it or use the ‘Contact and Quotes’ page to request information or book an appointment.
FAQs on general powers of attorney
Does the agent have to be an employee of the company?
Not necessarily. The classification as an agent depends on whether the person is responsible for the running of the business, a branch office or a specific division. An employment relationship may constitute the internal relationship with the business, but it is not in itself the requirement that determines the classification.
Can more than one agent be appointed?
Yes. Article 2203 of the Civil Code expressly provides for this possibility. If there are several agents, they may act independently of one another, unless the power of attorney provides otherwise.
Can an agent purchase a property?
Article 2204 of the Civil Code expressly prohibits an agent, in the absence of specific authorisation, from disposing of or mortgaging the principal’s property. It does not, however, impose a general prohibition on purchases. To determine whether a purchase falls within the agent’s powers, it is necessary to assess the relevance of the transaction to the business, the terms of the power of attorney and the nature of the contract to be entered into.
What happens if the limits of the power of attorney are not recorded?
If the power of attorney is not entered in the Companies Register, the agent’s authority is deemed to be general and any restrictions are not enforceable against third parties, unless it can be shown that they were aware of them at the time of the transaction.
What is the difference between an agent and a solicitor?
The manager is responsible for the running of the business, a branch office or a specific division. The authorised agent, as governed by Article 2209 of the Civil Code, may, on the basis of an ongoing relationship, carry out certain acts relating to the running of the business without being responsible for its management. The difference therefore lies primarily in the position held within the organisation of the business.