The New Italian Regulation on “Fair Compensation” of Professionals by Public Bodies

In the Italian legal system, professional remuneration has long been commensurate with a compulsory tariff system, which was believed to ensure full compliance with the constitutional provisions according to which ‘the worker has the right to a remuneration proportionate to the quantity and quality of his work and in any case sufficient to ensure for himself and his family a free and dignified existence’ (Article 36, Italian Constitution).

With particular reference to the legal profession, the current Italian professional law (Law No. 247 of 2012, art. 13) was supplemented in 2017 by the provision of the so-called ‘fair remuneration’. In short, this means that the minimum amount of a lawyer's fee is predetermined by law and the parties can only agree on higher amounts. Any different agreement is null and void by law. Therefore, the regulation of fair compensation was introduced to remedy situations of imbalance in contractual relations between professionals and ‘strong’ clients, identified in banking and insurance companies as well as companies other than SMEs. Among these strong parties, the Lawmaker also included the Public Administration, but provided that it was obliged to comply just with the ‘principles’ of fair compensation, rather than any particular “detail”. 

Such a regulatory framework allowed the Italian Public Authorities to exercise considerable discretion, from time to time choosing whether to apply this ‘principle’ (i) by identifying the minimum values set out in the price list as the auction base and allowing lawyers to bid even below this threshold, or (ii) to consider the legal minimum threshold as fixed and invariable and allowing downward competition only on items relating to the reimbursement of expenses, or (iii) to allow maximum freedom to bid without any reference to the legal minimum values (thus completely ignoring the provisions of the law).
The legitimacy of this discipline has been challenged by the Italian Authority for Competition and Market, on the base that it could imply a market principles breach.

Recently, it’s worth mentioning the new Italian Public Contracts Code (Legislative Decree No. 36 of 31 March 2023), where the Lawmaker did not fail to include the “principle” of contractual autonomy, establishing, at the same time, the prohibition of free intellectual work services. The Code introduces a general prohibition of gratuitous services by professionals and requires public administrations to respect the ‘principle’ of fair remuneration for professional services, but not for the introduction of a discretionary exception that, against adequate justification of the exceptional nature of the individual case, justifies the gratuitousness of the service.
The provisions of the Public Contracts Code must be read in conjunction with the provisions of a further - and slightly later - piece of new legislation, namely the Italian Law No. 49 of 21 April 2023, setting forth ‘Provisions on fair compensation for professional services’. In particular, according to Law n. 49 dated 2023 any detailed provisions – and not only the principles - ‘shall also apply to the services rendered by professionals in favour of Public Administration (…)’ (Art. 2, par. 3) .

Allow me to point out that there is no conflict between the above provisions and the freedom of establishment (Article 49, Treaty on the Functioning of the European Union - TFEU) or the ‘right to provide services in a competitive regime’ (Articles 101 TFEU and 15 E.U. Directive 2006/123/EC), nor is there any ‘ontological incompatibility’ between the same law and the regulations set forth in Legislative Decree No. 36 of 2023. In fact, the Italian Law No. 49/2023, in addition to pursuing objectives of protecting the professional, through the imposition of an adequate remuneration for the services rendered by the latter, contributes, among other things, similarly to the aforementioned judgement of anomaly of the offer, to avoiding that the free competitive comparison compromises professional standards and the quality of the services to be rendered in favour of the Public Administration.
However, in the current situation there are several reasons for uncertainty, especially due to the position taken by the National Anti-Corruption Authority, according to which a intervention by the Lawmaker is again necessary to clarify if even in the field of public contracts any detailed provisions on “fair compensation” are mandatory or not.

By Marco Mariani
Studio legale associato Catte Mariani
Florence, Italy