In Italy, a country heavily affected by the economical crisis following the 2008 subprime crack, foreclosures are abundant. That means that about 10% of the properties on the market are sold through judicial sales. These are great opportunities, since these properties are sold at a discount averaging 30% less than the price of comparable properties sold by private owners. So let’s see how these judicial sales work in Italy.

What are judicial sales of real estate

Judicial auctions are the means by which the judicial authority orders the sale of assets deriving from foreclosures, seizures, bankruptcies, etc. Everyone, except the debtor, can participate in judicial sales without the help of a lawyer or other professional (art.579 c.p.c.). The assets are normally estimated by experts appointed by the Court. In addition to the auction price, auction fees and tax charges are paid, if requested.

The sale takes place in the state in which the goods are located and is not subject to the rules concerning the warranty due to defects or lack of quality, nor can it be terminated for any reason. The existence of any defects, lack of quality or non-conformity of the thing sold cannot give rise to any compensation, indemnity or refund of the price, as this is taken into account in the valuation of the assets.

There is no right of withdrawal. The balance of the price and the payment of the tax charges must occur within the terms indicated in the specific methods of participation. Ownership of the property is transferred to the purchaser at the time of payment of the full price and tax charges.

In case of failure to pay the balance of the price within the established terms, the forfeiture of the contractor is declared, and if the sale provided for the payment of a deposit, the same is retained by way of sanction.

If a new enchantment is established, the defaulting bidder is required to pay the difference, in the event that the price obtained from the second auction, together with the confiscated bail, is less than that of the previous spell pursuant to art. 587 c.p.c.

The offers presented are IRREVOCABLE. There is no right of withdrawal and therefore it is not possible to withdraw the offers. Anyone with promises, gifts or fraudulent means, disturbs or prevents the freedom of enchantments, commits a crime is punishable by sanction and imprisonment according to the penal code. Sales may be suspended and / or canceled at any time by order or order of the Judicial Authority which established the execution thereof.

Who can participate in an auction

The code of civil procedure, in art. 579, provides that “everyone, except the debtor, is allowed to bid on the auction”. The need for technical representation is not foreseen. The offers, in fact, can be made personally or by means of an authorized representative with a special proxy.

How to participate in an auction

The methods of participation in an auction are different in relation to the Court concerned. It is necessary to present the application together with the security and / or deposit, within the terms established in the notice of sale.

Telematic sales of real estate

“Telematic sales transactions” means the activities carried out between the moment of the connection of the bidders to the portal of the telematic sales manager and the awarding or identification of the best bidder.

The regulation establishes the register of telematic sales managers, that is to say those subjects constituted in the form of joint-stock companies authorized by the judge to manage the electronic sale. The application for registration in the register must contain the indication of one or more districts of the Court of Appeal in which it intends to carry out the telematic sales service. Every telematic sales manager is required to establish an electronic register of telematic sales assignments. The telematic sales manager cannot participate, not even through a third party, in the sale of the assets subject to the pending proceedings before the judicial offices included in the Court of Appeal district, in respect of which it was registered. The Ministry carries out annual statistical monitoring of the electronic sales operations carried out by the managers.

The offer for the electronic sale must contain, among other things, the identification data of the bidder, with the express indication of the tax code or VAT number, the judicial office where the procedure is pending, the identification data of the procedure and lot and the description of the asset, the referent of the procedure and the sales data. The price offered and the deadline for payment are also indicated, except in the case of a request to participate in the auction. During the auction or resolution on the offer, in accordance with article 572 of the code of civil procedure, the judge or the referent of the procedure, having verified the regularity of the offers, starts the sales operations. The telematic sales manager prepares and displays on its portal an automatic system for calculating the deadline set for the formulation of the bids. The bids and observations of each bidder are reported in the portal of the online sales manager and made visible to the other participants, to the judge or to the referent of the procedure; in the same way we proceed for every determination of the latter. The judge, the referent of the procedure and the registrar can take part in the sales without enchantment. With the same procedures, other subjects may also participate if authorized by the judge or the person in charge of the procedure. In any case, the telematic sales manager’s portal ensures the access of the bidders to the data contained in the electronic document referred to in article 14, paragraph 3, and replaces the names of the bidders with pseudonyms or other distinctive elements capable of ensuring the ‘anonymity. The judge, the referent of the procedure and the chancellor can however access all the data contained in the offer referred to in article 14, paragraph 2.