Italy: A Public Law Overview

In 2025, Italian public law underwent significant transformation, shaped by EU regulatory developments, judicial scrutiny, and structural reforms linked to the National Recovery and Resilience Plan (PNRR). Key developments concerned energy regulation, public procurement, competition enforcement, artificial intelligence, soil protection, and the reform of the Court of Auditors.

Energy

The Italian energy framework was significantly restructured through the corrective amendments to the Consolidated Act on Renewable Energy Sources, introduced by Legislative Decree No 178/2025. The reform aims to accelerate renewable energy deployment by simplifying authorisation procedures and reducing administrative burdens. Notably, it raises the threshold for the Simplified Administrative Procedure to 12 MW for installations in suitable areas and reduces most procedural deadlines by 50%. Alternative dispute resolution mechanisms have also been introduced to limit litigation and enhance regulatory certainty.

Further changes stem from the “Energy Decree” No 175/2025, converted into Law No 182/2025. The measure revises the suitable areas regime and establishes transitional rules for projects pending as of 22 November 2025, provided documentation was complete. It defines “standard agrivoltaics” systems, requiring elevated photovoltaic modules and preservation of at least 80% of agricultural production capacity, while granting municipalities five-year verification powers. The reform also removes the Integrated Environmental Authorisation requirement for industrial sites to qualify as suitable areas.

Judicial developments have interacted with these reforms. The Constitutional Court annulled regional bans on renewable installations, while the Council of State referred questions to the Court of Justice of the European Union (CJEU) concerning the retroactive “excess profits” cap. The 2026 Budget Law further restricted depreciation incentives to EU-manufactured photovoltaic modules.

Public Procurement

Italy’s procurement regime continues adapting to Legislative Decree No 36/2023 (Public Contracts Code), as amended in 2024. Judicial interpretation has played a central role, particularly regarding the “principle of result” under Article 1. Administrative courts have increasingly deferred to contracting authorities’ technical assessments, preserving tender outcomes despite formal irregularities and limiting legal challenges brought by unsuccessful bidders.

While this approach promotes efficiency, it raises concerns under the EU principle of the rule of law and competition law where procedural guarantees risk being weakened.

Compatibility issues have also emerged in relation to project financing under Article 193 of the Code. The most controversial feature is the promoter’s right of pre-emption (Article 193(12)), allowing the promoter, if not selected, to match the winning bid and obtain the contract upon reimbursement of the successful bidder’s costs. Although designed to incentivise private initiative, this mechanism may restrict competitive dynamics and discourage participation.

These concerns culminated in infringement procedure No 2018/2273 and the CJEU’s judgment of 5 February 2026 (C-810/24), which held that the structural design of the pre-emption right undermines transparency and equal treatment. Legislative reform is now required to rebalance investment incentives with EU procurement principles.

Antitrust

Public intervention in regulated sectors remains extensive, exercised through independent authorities such as the Italian Competition Authority (AGCM). The AGCM holds broad investigative and sanctioning powers, including the enforcement of EU competition law.

Judicial scrutiny has intensified, evolving from traditional legality review toward a more substantive assessment of proportionality and evidentiary standards. Recent rulings of the Council of State (Order No 4151/2025) and the CJEU (Caronte, C-511/23; Trenitalia, C-510/23) emphasise procedural safeguards and effective judicial review.

As a result, litigation challenging AGCM fining decisions has become structural. Alongside annulment proceedings, co-operative enforcement tools have gained prominence. These include compliance programmes (AGCM Resolution No 31466 of 25 February 2025) and leniency mechanisms under Articles 15-bis et seq. of Law No 287/1990, enabling sanction reductions in exchange for co-operation.

Artificial Intelligence

The digitalisation of administrative procedures and growing reliance on AI tools are reshaping interactions between citizens and public authorities. While efficiency gains are evident, automated decision-making raises transparency and accountability concerns.

In ruling No 4929/2025, the Council of State reaffirmed the principle of human oversight in AI-assisted administrative action. The case concerned denial of access to agricultural subsidy documentation managed through automated systems. The Court clarified that technical complexity cannot justify restricting access rights, underscoring the administration’s duty to ensure transparency and document availability.

Legislative Decree No 36/2023 also regulates automated procedures in public tenders, requiring access to source code, intelligibility, non-discrimination, and human oversight. Italy is among the first EU member states to adopt a comprehensive national framework aligned with the EU AI Act. Law No 132/2025 entered into force on 10 October 2025, establishing general principles for AI deployment within public administration.

Soil Protection

The Soil Monitoring Directive, approved by the European Parliament in 2025, introduces a framework to improve soil health and resilience. Italy must establish soil units and districts for monitoring, introduce support measures for soil managers, and create a public register of contaminated or potentially contaminated sites.

The Directive addresses “land take”, defined as soil sealing or removal. Mitigation measures include reducing the affected area of projects and compensating through de-sealing or soil reconstruction. Although additional obligations remain limited at this stage, the Directive integrates soil governance into the EU’s broader sustainability strategy, signalling progressively stricter regulatory oversight.

Court of Auditors

Law No 1 of 7 January 2026 reformed the Court of Auditors, amending Law No 20/1994 and Legislative Decree No 174/2016. The reform follows Constitutional Court Ruling No 132/2024, which called for rebalancing administrative liability, protection of public finances, and administrative efficiency.

The reform clarifies the notion of gross negligence, excluding liability where officials rely on established case law, competent authority opinions, or acts subject to pre-emptive review. For officials involved in settlements or alternative dispute resolution, liability is limited to wilful misconduct.

Judges’ powers to reduce damages are now subject to mandatory reductions in specified cases, alongside compensation caps except in instances of wilful misconduct or unlawful enrichment. Political bodies benefit from strengthened presumptions of good faith when decisions rely on official technical assessments.

The reform also expands pre-emptive scrutiny of public contracts, particularly those linked to PNRR and PNC funding, enhancing the advisory role of the Court and introducing sanctions for procedural delays.

Conclusion

Italian public law in 2025 reflects a dual dynamic: internal simplification aimed at accelerating investment and administrative efficiency, and external constraint stemming from EU constitutional principles and regulatory harmonisation. Energy reforms and liability recalibration seek to facilitate project implementation and reduce administrative risk, particularly in PNRR-funded initiatives.

At the same time, EU oversight continues to shape national reforms, as illustrated by developments in procurement and competition law. New domains such as AI governance and soil protection further expand the scope of public regulation, embedding sustainability and digital accountability into administrative action. The interaction between domestic reform and European integration will define the trajectory of Italian public law in the coming years.