Berlusconi wins long-running banking dispute at EU court

Silvio Berlusconi today (September 19) secured a posthumous victory at the EU’s highest court, as part of a long-running dispute over the ownership of Milan’s Banca Mediolanum.

The late media tycoon and former Italian prime minister could keep his stake in an Italian bank despite a conviction for tax fraud, judges at the European Court of Justice (CJEU) have said.

The European Central Bank (ECB) “could not lawfully object to the fact that Mr Berlusconi held a qualifying holding in Banca Mediolanum”, the Court said, since he merely “continued to hold a qualifying holding acquired before the transposition of the provisions of EU law relied on by the ECB.”

As the EU’s main financial supervisor, the ECB is responsible for ensuring that anyone holding more than 10% of a bank’s shares is in good standing.

In 2016, the regulator came under fire over the stake Berlusconi had in the bank through his investment company Fininvest, following his conviction for fraud.

But judges today ruled that the ECB has no right to investigate a transaction that took place when the bank was taken over by its own subsidiary, overturning a previous 2022 ruling by the Court of First Instance that had ruled in Frankfurt’s favour.

After the financial crisis, the power to supervise EU banks was transferred from national authorities to the ECB in Frankfurt. In 2014, the Bank of Italy ordered Berlusconi to sell his shares, a decision that was later overturned on appeal by national courts.

In his colorful careerDuring his multiple term as prime minister, Berlusconi was tried on multiple occasions on charges including mafia affiliation, bribery and underage prostitution, but his only conviction came in a 2013 tax fraud case.

His four-year prison sentence led to his expulsion from parliament, although his lawyers told the EU court he had been effectively rehabilitated since then.

He died in 2023, but the business was continued by his heirs and family members, many of whom serve on Fininvest’s board of directors and have ties to his other companies, such as the broadcaster Mediaset.

Spokespeople for Fininvest and the ECB did not respond to a request for comment.