After his death, Berlusconi wins long-running banking dispute

(CN) — The European Central Bank wrongly stopped Silvio Berclusoni, the former Italian prime minister and media mogul who died little more than a year ago, from retaining a stake in lender Banca Mediolanum after a tax fraud conviction, Europe’s high court ruled on Thursday.

The European Court of Justice annulled the ECB’s 2016 ruling, putting an end to a long-running dispute over whether Berlusconi could hold onto his 30% in the Milan-based bank after getting convicted for fraud in August 2013.

The court said Berlusconi was shielded from EU laws forbidding tax cheats from possessing large shares of a financial company — known as a qualifying holding — because his ownership in Banca Mediolanum predated the adoption of the laws in Italy.

“The ECB could not lawfully oppose Mr. Berlusconi’s ownership of a qualifying holding in Banca Mediolanum,” the court said in a statement.

Thursday’s ruling is final and it overturned a 2022 decision by the General Court, a lower chamber.

In 2014, the Bank of Italy ordered Berlusconi’s holding company, Fininvest, to sell all but 9.9% of its shares in the bank, arguing that Berlusconi “did not meet the reputation requirement” for owning a large stake in the bank. The ECB later upheld that decision.

Since the 1990s, Fininvest owned about 30% of Mediolanum, a financial services company that controlled Banca Mediolanum.

Berlusconi was convicted of tax fraud for buying television rights at artificially inflated prices through a series of holding companies in an effort to avoid paying taxes in Italy.

Thursday’s verdict was vindication for Berlusoni’s heirs, many of whom sit on the board of Fininvest and are linked to his other companies, including the broadcaster Mediaset.

After the media mogul’s death, his heirs asked the ECB and the Bank of Italy to remove limits on the stakes they could own in Banca Mediolanum, which is worth about 2.5 billion euros ($2.79 billion).

The ECB and Fininvest did not immediately comment on the ruling.

Berlusconi, who was once Italy’s richest man, earned his wealth creating an Italian media empire. Over his splashy and controversial life, he faced a range of charges and trials — including for mafia affiliation, corruption and underage prostitution — but his only conviction was the 2013 tax fraud case.

Courthouse News reporter Cain Burdeau is based in the European Union.

Follow @cainburdeau