Omni Bridgeway targets Italian dividend tax regime with funded claims for non-EU investors

Omni Bridgeway is preparing to back a wave of tax recovery claims against Italy’s dividend withholding regime, aiming to unlock refunds for non-EU institutional investors who may have been overtaxed on distributions from Italian companies.

The litigation funder is investigating and coordinating a group action on behalf of investment funds and corporate entities seeking reimbursement of withholding tax applied at rates of 15% to 26%, which claimants argue were levied in breach of European Union law. The effort builds on a growing body of favourable precedent, including rulings from the Court of Justice of the European Union and Italy’s Supreme Court, which have found certain differential tax treatment of foreign funds incompatible with the free movement of capital.

At the core of the claims is the disparity between domestic and foreign investors. Italian and, more recently, EU-based funds benefit from exemption regimes, while comparable non-EU funds have historically been subject to withholding tax on dividends. Courts have increasingly held that where foreign funds are sufficiently regulated and information-sharing mechanisms are in place with their home jurisdictions, that distinction cannot be justified.

Omni Bridgeway is proposing to fund and manage a coordinated series of reclaim actions, with legal strategy led by Italian tax litigation firm Tremonti Romagnoli Piccardi e Associati. The firm has already secured full refunds in similar cases, including for US pension funds.

The opportunity is both sizable and time-sensitive. Claims can generally be brought for withholding tax paid within the past 48 months on a rolling basis, creating urgency for eligible investors to assess potential recovery.