European succession refers to the management and transfer of a deceased person’s assets to their heirs when they owned assets in European countries other than their own.
The issue of cross-border succession remained controversial in Italy until the application of EU Regulation No. 650/2012 on July 4, 2012, which came into effect on August 17, 2015.
Specifically, the Regulation introduced the European Certificate of Succession, a document that can be used in any member state. Its purpose is to determine who has the authority to decide and distribute the inheritance among the rightful beneficiaries, regardless of the country they reside in.
Before the Regulation, various factors were considered, making the management of succession for individuals with ties to other countries particularly complex. These factors included:
- Country of origin of the deceased and their original citizenship.
- Possible acquisition of citizenship in another country.
- Residence at the time of death.
- Countries where the assets comprising the inheritance are located.
The result was a complex intertwining of laws and judicial authorities from different states, leading to unpredictable timelines.
The European Union has established concrete guidelines to clarify the competences involved, starting from the premise that each European state presents substantial differences in this matter. A regulation that is valid across borders not only serves to reach consensus but also to regulate relationships with non-European states.
What is succession?
Succession occurs when a person dies, leaving behind assets, including property, possessions, and debts.
During the succession process, in the presence of a will, the assets are transferred to the beneficiaries designated by the deceased person.
In the absence of a will, the laws of succession of the country where the person died are applied.
The same applies to Italian citizens who choose to live beyond our borders while retaining ownership of real estate in their home country.
In both situations, succession implies a moment of reflection to determine the legal framework that will regulate it.
The fundamental principle is that the applicable law should be that of the country where the deceased chose to live, transferring their interests, business, or relationships.
The concept most found in European laws (including Italian law, for example), which states that citizenship remains valid, is replaced by a preference for habitual residence.
The three types of European succession
In Europe, there are three main types of succession:
- Testamentary Succession
- Legitimate Succession
- Legal Succession
Testamentary succession occurs when the deceased person has drafted a will that provides specific instructions on how their assets should be distributed after their death.
The will may designate executors and specific beneficiaries. The process of testamentary succession follows the guidelines established in the will, which must be drafted according to the laws of the state where it is deposited.
The person making the will can also indicate in writing the choice of law (professio iuris) to be applied to their succession, choosing between the law of their country of birth or the law of their country of residence.
Legitimate succession applies in the absence of a valid will. The laws of succession in the state where the person died will determine how the assets should be distributed. The law will establish the rightful heirs, usually prioritizing spouses and children in all legislations.
Legal succession becomes necessary in the absence of direct heirs and specific instructions from the deceased.
The state becomes the heir, and the succession process is managed by the competent authorities.
The assets must be sold, and the proceeds will go to the state treasury or be used for public purposes.
How to divide an inheritance?
After determining the applicable type of succession, the next step is to establish how the assets will be divided.
During the succession process, the assets can be divided equally among the beneficiaries or according to specific testamentary provisions.
The assets can be distributed directly to the beneficiaries as they are, or the proceeds can be divided after their sale.
What is the European Certificate of Succession and how to obtain it?
The European Certificate of Succession (ECS) is a standardized document that certifies the status of heirs, testamentary executors, or administrators of an estate.
It simplifies the process of cross-border succession. It is advisable to apply for it when inheriting a property located in a European Union country other than one’s own and when proving ownership to the authorities of that country.
To obtain an ECS, an application must be submitted to the competent authority of the member state where the succession procedure was initiated or where the property to be inherited is located.
Renouncing the inheritance
In cross-border successions within the European Union, it is possible to renounce the inheritance by applying the law of the heir’s country of residence.
Even if the succession falls under the jurisdiction of a different member state, the heir residing elsewhere can use an alternative forum to make their declaration of renunciation (or acceptance) of the inheritance before a judicial body in their habitual country of residence.
It remains the responsibility of heirs who have renounced the inheritance to communicate the existence of such declaration to the competent judicial authority deciding on the succession.
For example, an individual residing abroad can renounce an inheritance in their home country, such as Italy. This renunciation must then be registered within the territory of the Italian Republic within sixty days from the completion of the act. The agency responsible for registering the renunciation is the Revenue Agency (Agenzia delle Entrate).
Succession outside the EU
According to the Regulation, the jurisdiction to decide on the rules of succession lies with the habitual residence of the deceased at the time of death, extending to successor assets, movable and immovable, located in a non-EU member state or a state not adhering to the Regulation.
Italian citizens who decide to move abroad at any time in their life might wrongly assume that their succession falls under Italian jurisdiction.
The choice is up to the citizens, even if they live in a non-EU country.
The topic of successions remains a complex and delicate matter as it must be approached while considering a bereavement (either already occurred or anticipated) and the division of assets among individuals who may not be in harmony with each other.
Consulting a legal professional specialized in European succession can help ensure proper management of an inheritance, oversee fair distribution, and prevent or resolve conflicts. Additionally, it would ensure compliance with the specific regulations of the relevant country.
If you have any doubts about an inheritance, wish to make a will, need to initiate a succession procedure in Italy, or if you are the heirs of property located in a country other than your own, do not hesitate to contact our legal experts in the Department of Succession.
Complete the form to request a legal consultation. Our experts will evaluate your case and suggest the best solution.