Construction bonds

On July 6th, 2005 it was published in the Official Journal the Legislative Decree n. 122 approved on June 20th 2005 which enforced Law n. 210/2004 that introduced in Italy a specific law for the protection of buyers of buildings under construction.

The cited law pursues the specific aim of offering an overall insurance protection to the credit of buyers of buildings under construction in all those cases, frequently registered in the past, in which the builder’s state of insolvency turned into a bankrupt or other procedure of liquidation.
The major tools offered by the legislator are the following:

• A guarantee in favour of the buyer for the restitution of the advanced payments made in case of non fulfillment of the terms of the contract caused by a situation of crisis of the builder;
• A 10 years guarantee to cover the possible damages to the building, to third parties, according to art. 1669 Italian civil code, connected to the total or partial collapse of the building, grave construction damages, faults of the soil or of the building.