*by Fulvio Sarzana di S.Ippolito, Lawyer, Sarzana and Partners Law Firm. Sarzana Law Firm and Associates
In a few weeks the Court of Cassation has issued two sentences that address the framework of the Single Property Fee (CUP) in the electronic communications sector.
The Single Property Fee (CUP) It is a local tax introduced in Italy to simplify the management of local government revenues. It consolidates into a single payment the various taxes previously due for the occupation of public spaces and the dissemination of advertising messages.
Electronic communications operators would also be subject to this fee, even if they use the infrastructure of other operators indirectly.
The United Sections: the CUP is a tax, and jurisdiction lies with the tax judge
With a ruling dated May 1, 2026, the United Civil Sections resolved one of the most controversial issues in the entire single canon affair: that of jurisdiction.
The starting point was a preliminary reference from the Vicenza Tax Court of First Instance, which had highlighted the existence of three different approaches in the case law of the merits: some attributed jurisdiction to the tax judge, some to the ordinary judge, and some made a case-by-case distinction depending on whether the dispute concerned the occupation of public land (letter a, paragraph 819) or the dissemination of advertising messages (letter b).
The United Sections cut the Gordian knot with a clear response: the CUP has, in any case, a fiscal nature, with the consequent exclusive jurisdiction of the tax judge for all related disputes.
The reasoning is based on three criteria consolidated by constitutional jurisprudence to identify a tax: the obligation to perform the service, deriving directly from the law without any bilateral relationship with the entity; the lack of correspondence between payment and concession provision; the connection to an economically relevant prerequisite; and the allocation of resources to cover public expenditure.
The fact that the 2019 legislator designated the tax "patrimonial" doesn't change anything: the legal name, as the Constitutional Court has repeatedly affirmed, is never decisive in classifying an income. What matters is the substance of the legal regime, and that is, unequivocally, tax-related.
Particularly significant is the passage in which the Joint Sections analyze the regulatory evolution regarding the abolished levies. The CUP adopted the TOSAP tax model, rather than the COSAP fee, a property fee. The legislator's decision to make the fee mandatory for all entities, to expressly include unauthorized occupations, and to base the requirement on the occupation itself, rather than the issuance of the permit, confirms the direction taken.
The Joint Sections therefore state the following principle of law: «The single property fee referred to in the’Article 1, paragraphs 816-847, of Law No. 160 of 2019, has, in any case, a fiscal nature".
Immediate practical consequence: anyone who has challenged or intends to challenge a CUP assessment notice must contact the Tax Court of Justice, not the Justice of the Peace or the Civil Court.
And anyone who has taken the wrong track in the meantime will have to deal with the expiration terms.
The Third Civil Section: virtual operators pay
A few days earlier, the Third Civil Section of the Court of Cassation had already clarified the other major issue: telephone operators who access other people's networks in "virtual" mode (typically through VULA technology) are liable for the CUP just like the concessionaire of the physical infrastructure.
The case involved Wind Tre and the Municipality of Tribiano. The Court of Lodi, on appeal, annulled the assessment notice, holding that Wind Tre was making merely "virtual" use of the TIM/Open Fiber network, insufficient to meet the "material use" required by Article 1, paragraph 831, of Law 160/2019. The Court of Cassation overturned that ruling and remanded the case.
The Court's reasoning is this: telephone services are powered by electricity, and an electrical signal, a movable asset pursuant to Article 814 of the Italian Civil Code, always requires a material element to propagate. There is no such thing as a physical "virtual use" of the network. The only thing that can be virtual is the access method, the VULA management software that separates the flows of the different operators, but the signals still transit the concessionaire's physical infrastructure. And this is a "material use" of the network.
The Court's reasoning, "electrical signals physically travel, therefore there is physical use," is elegant but opens the door to serious criticism. The Supreme Court confuses the physical with the legal-regulatory. That photons travel over TIM's fiber optics when a Wind Tre customer surfs is a matter of physics. But the law does not regulate photons: it regulates relationships between subjects. The legally relevant question is not "is electricity flowing on someone else's network?" but "Wind Tre occupies public land?".
Occupation of public land is a legal category that presupposes a direct relationship between a party and a public property. Wind Tre has no title, whether by concession or otherwise, to the underground infrastructure. It cannot remove it, modify it, or physically access it. Its relationship is exclusively with TIM, on a private contractual level. To argue that those who have a commercial contract with the concessionaire "occupy public land" is an analogous extension of the concept of occupation that the Court itself applies in a completely forced manner.
Equally clear is the response to the attempt to leverage the 2021 authentic interpretation provision (Article 5, paragraph 14-quinquies, Legislative Decree 146/2021), which excludes from "mediated occupation" those "holding the contract for the sale of the goods distributed to end customers." The Court notes that this provision was designed for gas and electricity distribution, sectors in which there is a true separation between the network owner and the seller of the product already physically present on the network. However, the telephone operator does not sell a good: it provides a service. The transfer of ownership, a typical element of a sale pursuant to Article 1470 of the Civil Code, is missing. The exemption provision, being subject to strict interpretation due to its exceptional nature, cannot be extended by analogy.
The legal principle stated is clear: «A telephone service provider who uses “virtual” access to a network owned by another party (e.g., using VULA technology) is required to pay the CUP».
The assertion has been subjected to strong criticism.
The Court of Cassation uses paragraph 831 as if the notion of "mediated occupation" were an ontological given, while it is actually an exceptional legislative construct. The 2020 legislator invented a taxable person who occupies nothing in the traditional sense of the term, and did so for tax revenue reasons, not for systematic coherence.
Precisely because this is a fiction, an "as if" occupation, the principle of strict interpretation of the exceptional provisions (Article 14 of the preliminary provisions) should apply both ways: not only to restrict exemptions (as the Court does), but also to limit the expansion of passive subjectivity. The Court of Cassation applies the restrictive criterion only to the detriment of operators, when it could legitimately also be applied to their advantage.
The Court states that the telephone operator does not "sell goods" but "provides a service," and therefore the 2021 exemption provision does not apply. The reasoning is formally correct from a purely civil law perspective, but suffers from some weaknesses.
First, the European regulatory framework, in particular the European Electronic Communications Code (Directive 2018/1972/EU) The Italian Electronic Communications Code (Legislative Decree 259/2003) classifies electronic communications services as regulated services, not as the sale of goods, but treats them, in terms of infrastructure, substantially similarly to network services such as gas and energy. The separation between network ownership (TIM) and service provision (Wind Tre) is structurally identical to that of the gas market: there is one physical distributor, but many sellers. If the 2021 legislator intended to exempt this market structure in one sector, it is at least questionable to argue that it intended to discriminate against an identically structured sector.
Second, the definition of "contract for the sale of goods distributed to end customers" in the 2021 regulation is, as the Supreme Court itself recognizes, "non-technical." A non-technical regulatory expression cannot be interpreted with the rigor of Article 1470 of the Italian Civil Code: when the legislator uses an improper term, the systematic and teleological interpretation should prevail over the literal one. And on a teleological level, the rationale of the 2021 regulation was clearly to protect resellers and service providers who do not own infrastructure. Wind Tre falls squarely into that category.
What to do now
Contesting the use of the network in the specific municipality's territory
This is probably the most immediately viable option following the ruling. The legal principle established by the Supreme Court presupposes that the operator uses the physical infrastructure present within the municipality issuing the assessment. If the operator can demonstrate that users in the specific municipality are served through different network architectures, such as roaming, pure interconnection agreements, or proprietary networks, the requirement of indirect occupation is not met.
Challenge the method of calculating utilities and the legitimacy of the presumptive criteria
This is the most fertile area from a technical and legal perspective. Paragraph 831 refers to "users as of December 31 of the previous year" reported via self-declaration. When the operator fails to submit a declaration, collection agencies (such as Abaco SpA) use presumptive criteria, often based on national market data, operator market shares, or AGCOM data, to estimate the number of users in the municipality.
These presumptive criteria are open to challenge on several fronts: the lack of a specific regulatory basis authorizing them in the CUP (unlike other taxes that expressly provide for inductive assessment); their intrinsic approximation, which can lead to the attribution of users already counted by other municipalities or already assigned to the main concessionaire; and the violation of the principle of taxable capacity if the presumed number of users is manifestly disproportionate to the operator's actual penetration within the municipal territory.
Raising the question of compatibility with European law
The European Electronic Communications Code (Directive 2018/1972/EU) is based on the principle that access to third-party networks, imposed by law on incumbent operators as a regulatory obligation, must not result in additional burdens for accessing operators that are incompatible with the internal market. Imposing the CUP on virtual operators means taxing an activity that European law requires operators to perform: network access is a regulatory obligation, not a free commercial choice. There is room for argument that applying the CUP to virtual operators impacts regulatory neutrality and the effectiveness of unbundled access to the network, in violation of the objectives of the Directive. This argument was not developed in the cases reviewed by the Court of Cassation and could open a preliminary ruling before the Court of Justice of the European Union.
The question of constitutional legitimacy
There is a potential element of unreasonableness under Article 3 of the Constitution in the unequal treatment of telephone operators and gas and energy distributors, structurally identical in terms of their model of access to each other's infrastructure. While the 2021 legislator chose to exempt the former, it is difficult to rationally justify the inclusion of the latter based on the distinction between "sale of goods/provision of services," a distinction which, as we have seen, is itself the result of a regulatory expression that the Court of Cassation itself defines as "non-technical." A question of constitutionality regarding paragraph 831, in the part in which it includes virtual telephone operators among the taxable entities without providing for the exemption granted to energy distributors, could be of some substance.
The profile of double taxation
In some cases, a situation arises where the infrastructure concessionaire (TIM) already pays the CUP calculated on the total number of users, including those of virtual operators, and then contractually transfers part of that cost to the virtual operator through network access fees. If, at the same time, the Municipality also requests the CUP directly from the virtual operator for the same users, this constitutes a duplication of tax on the same economic basis. This aspect, which the Supreme Court ruling does not address, deserves to be explored in individual disputes based on the contractual documentation and declarations already submitted by the concessionaire.
Furthermore, the question of the legitimacy of the presumptive criteria adopted by tax collection agencies when the operator fails to file utility declarations remains open, and will likely become the subject of further litigation. Case law has already begun to address this issue, but further action will likely be needed to establish uniform rules nationwide.
English 
Italian 