H Research Edition number 2019-20, volume English

H RESEARCH EDITION

Professional scientific magazine edition english

H Research edition. Publisher writing to 22790 Department Italian Government AGCOM ROC. Director Engineer Dr. Gnazzo Vito Annual magazine, publication namber 2019-20 Publisher Italy, Capaccio (Sa) www.htnetEdition.eu ISSN 2532-5612

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ABSTRACT. With the studies conducted in the publication 2019-20.01 we looked for information on the introduction of distance services in the European market, with greater interest for financial services. In the first part we conducted research on the liberation for companies to settle in the European market, then the possibility of opening branches in a member state, studying the evolution of technical legislation on starting from the '70s (1973), with interest in what happened in the same period and up to now with regard to the annual accounts of companies and jurisdiction in the field of distance services.

In publication 2019-20.02 we conducted research on OTC derivative instruments, focusing our studies on EU regulation 648/2012 and regulation 575/2013 / EU. Of interest for this research is the obligation established by the Commission for OTC standard contracts to be cleared by a CCP counterpart with regulation 648/2012 / EU, and the prudential requirements established for credit institutions and investment firms by Regulation 575 / 2013 / EU. Greater interest was given to the definition of the instrumental elements that define the regulatory capital of a public interest institution (banks, financial institutions) with reference to the various risks and the relative weightings envisaged by the financial regulatory framewrok. In the appendix we have carried out a feasibility study for a limited entity of public interest.

In publication 2019-20.03 with reference to liquid, gaseous and solid fuels, we have carried out research on European legislation concerning the quality of fuels and the emission of harmful pollutants into the air. We have been interested in the technical analysis of a fuel by carrying out research on the relevant quantities with which they are characterized: calorific value, combustion temperature, power on temperature, ignition temperature, combustion air, viscosity, calorific value; we carried out studies on the theoretical method for the determination of the calorific value and of the combustion air and of the efficiency of an engine plant, with interest also to some experimental methods. Finally, we focused on the analytical determination of the global efficiency of a motor system.

With the publication 2019-20.04 we do not think it possible to reconstruct the development of the teaching of Applied Mechanics to the Machines in Naples on the basis of the texts that the various teachers, of which we have news, it

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have wrote or used for the conduct of their lessons, lacking, among other things, indications certain for all the period to which we have turned our interest. At the same time we consider important the knowledge of the bases on which it they came forming not only the students, but also the teachers who taught in what is currently the Faculty of Engineering Federico II of Naples, Italy. We also consider it important, for any future studies, to make known the amount of books available in the Faculty and in the departments connected to it. For these reasons we have collected in this chapter the various texts of which we have come to know, reporting in full the indexes of the topics, obviously useful to know the problems considered interesting for the study and at the same time understand their evolution.

From the preface of the text 'General Theory of Machines' by F. Reuleaux, director of the Berlin school, year 1874, first chapter, page 67: the following considerations are intended to discuss the various aspects under which machines are generally presented in order to determine, among many, the real point of view from which one must study. We therefore understand them: Basic principles of a general theory of machines. …. Here it is not just a matter of giving a new form to principles already known and discussed, nor of substituting new subdivisions and new nomenclatures to the ancient ones. Perhaps with such modifications it will be possible to treat the matter with greater ease or elegance; but for practical use one can still use the known methods for a long time.

… for, to open with a phrase by Goethe, one does not possess anything but what one understands ...

An arduous task is certainly to establish in what period and course the lessons of Applied Mechanics to Machines emerge. Intuitively we have to think in some course of Mechanics, then roughly in the period in which courses on Machine Mechanics are introduced; for something more exhaustive you must immerse yourself in historical archives, browse fascinating books that date back to the second half of the eighteenth century, like the text by Frisi Paolo, "institutions of mechanics, hydrostatics of hydrometry and static architecture, and hydraulics to use in the royal school erected in Milan for architects, and for the engineers ", fabulous handwritten texts.

To give the best solution to our problem, that is to say, to try to understand, what were the topics studied that, at least in part, concerned the Mechanics Applied to Machines, before its official insertion, we considered it appropriate to face the problem with a historical approach. Not having specific documents, which could lead directly to the solution of the problem, we have circumvented the obstacle by trying to follow, according to a temporal and logical progression, the events that have marked the history of the Mechanics Applied to Machines ".

In the first part of the publication we had an interest in the historical study of documents, turning more attention to the birth and evolution of the topics of

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Applied Mechanics to Machines in the second part. to Machines ".

In publication 2019-20.05 we dealt with the Securities Financing Transactions (SFT) that until 2014 were not regulated by any legislation. We have turned our attention to Regulation (EU) 2015-2365 which also modifies the regulation (EU) 648/2012 of interest for OTC derivatives, the latter regulation, which among the different rules introduces the obligation of a CCP counterparty and the related conditions for derogate the obligation. Being the subject of the Securities Financing Transactions the investment funds regulated by the Undertakings for Collective Investment directives in Transferable Securities (UCITS) we have carried out a study of Directive 2009/65 /EC and Directive 2014/91/EU which define the current regulatory legislation for the UCITS, with a look at the previous regulations. In identifying the related legislative framework, we carried out research and studies in separate paragraphs identifying the legislation that establishes the obligations for the access of collective investment companies of funds raised among the public, the related management companies, paying attention mainly to the current rules, in force, and how they have been changed to date. We have carried out further research and studies with reference to investment companies to the relative requirements for the provision of investment services, capital adequacy, the conditions that allow the disbursement of investment services defined from the legislation with the provisions of the Directive (EU) 2014/65, directive defining investment services and activities, ancillary services, financial instruments and data communication services. We have paid attention to private trading systems that offer the possibility to trade listed financial instruments on a stock exchange, without regulatory admission and disclosure tasks having only the obligation to have specialists required to support the liquidity of trading books (Multilateral Trading Facilities MFTs); we also carried out studies for algorithmic trading and High Frequency Trading (HFTs) for which the directive (EU) 2014/65, MIFID, establishes special controls. We were interested in the 2011/61/EU directive and subsequent updates that regulate the management companies of the alternative investment funds GEFIA, immediately observing that the AIFs, unlike the management companies, do not have a harmonized regulation given the impossibility caused by the diversification of the financial instruments that build the FIAs themselves in different European and non-European countries. Finally, we were interested in credit rating companies, their importance in financial investments, their evolution both globally and in Europe, with a look at their criticality, roles and consequences of their credit ratings in the economy.

Publication list

H Research Edition Italian: magazine number 2019-20

ANNUAL ACCOUNTS, JURISDICTION

Distance Financial Services

publication 2019-20 01

INSTITUTIONS OF PUBLIC INTEREST, CREDIT INSTITUTIONS

OTC over the counter markets, risks and assets of supervision of credit institutions

publication 2019-20 02

SOLID, LIQUID AND GASEOUS COMBUSTIBLE

Legislation on quality and harmful emissions

publication 2019-20 03

MECHANICS APPLIED TO MACHINES

Evolution of the Teaching in School Education

publication 2019-20 04

INVESTMENT COMPANY, UCITS, GEFIA, CREDIT RATINGS

SFT transparency obligation

publication 2019-20 05

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Keywords magazine number 2019-20, volume English: services and products at distance, distance financial services, competent jurisdiction, publicity of annual accounts, legal audit.

OTC over the counter markets, CPP clearing obligation for OTC, regulatory capital for institutions, instrumental elements, risk weighting, credit institution requirements, ECAI rating, payment institution.

Fuels, fuel quality, combustion air, ignition temperature, combustion temperature, power on temperature, ignition temperature, calorific value, overall engine system efficiency.

Topics of the discipline Mechanics applied to the machines, Elementary treatment of the machines, Complete treaty of the applied mechanics to the arts, Steam machines, Manual of Technical-Practical Mechanics for the use of the artists, professionals, owners, Treatise of the mechanisms, Treaty of pure kinematics, Theory General of Machines, Centrifugal Regulators, Steam Machine Distributions, Machine Builder, Mechanism Theory, kinematics of Plunger Mechanics, Machine Kinematics and Dynamics.

SFTs, securities financing transactions, credit default swaps, UCITS, UCITS, FIA, GEFIA, credit ratings, investment companies, collective investment schemes, alternative investment funds, regulation 2015/2365/EU, regulation 236/2012/EU, Directive 2009/64/EU, Directive 2014/65/EU, Directive 2011/61 GEFIA, Regulation 1060/2009/EC, Trading Algorithmic (AT), High Frequency Trading (Hfts).

Publication list

H Research Edition English: publication 02 magazine number 2019-20

INSTITUTIONS OF PUBLIC INTEREST, CREDIT INSTITUTIONS Markets over the counter OTC, risks and regulatory capital of credit institutions

publication 2019-20 02

1 – MARKETS OVER THE COUNTER OTC

2 - OBLIGATION TO OTC COMPENSATION

3 – REGULATORY CAPITAL AND PRUDENTIAL REQUIREMENTS FOR CREDIT INSTITUTIONS

4 – RISKS FOR CREDIT INSTITUTIONS 4.1 – Introduction 4.2 – Risk classification 4.3 – Prudential supervision

5 – RISK WEIGHTING

6 – APPENDIX INSTITUTIONS OF PUBLIC INTEREST: PAYMENT INSTITUTE 6.1 – Introduction 6.2 – Description of the lines of development of the activity 6.3 – Forecast report on technical profiles and capital adequacy 6.4 – Report on the organizational structure 6.5 – List and characteristics of payment services 6.6 – Computer security, software and hardware systems

Author: engineer Vito Gnazzo

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OTC over the counter markets, risks and regulatory capital of credit institutions.

Public interest institutions, credit institutions.

In publication 2019-20,02 we will carry out research on OTC derivative instruments, focusing our studies on EU regulation 648/2012 and regulation 575/2013/EU. Of interest for this research is the obligation established by the Commission for OTC standard contracts to be cleared by a CCP counterpart with regulation 648/2012/EU, and the prudential requirements established for credit institutions and investment firms by Regulation 575/2013/EU. In the appendix we will carry out a feasibility study for a limited public interest institution, a payment institution.

1 - OVER THE COUNTER OTC MARKETS The general definition of OTC markets shows the following: over the counter markets (OTC markets) are characterized by not having the requisites recognized on regulated markets . These are markets whose trading takes place outside the official stock exchange circuits. OTC markets are therefore the complex of transactions involving the purchase and sale of securities that are not listed on stock exchanges, whose functionality is organized by some players, and whose characteristics of the contracts being traded are not standardized. The listing on unregulated markets (OTC) takes place according to the principle of matching the demand and supply only; therefore their value changes continuously and in a manner that is not correlated with the trend of the world stock exchanges.

The European Commission in various communications of 4 March 2009, 3 July 2009, 20 October 2009, highlighted the need to strengthen the EU regulatory framework for financial services, assessed the role played by derivatives in the financial crisis and the need to guarantee efficient, safe and sound derivatives markets, it have illustrating strategic actions for the future,

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with particular reference to the measures it intends to take to reduce the risks associated with derivatives.

With the report prepared by a high-level group chaired by Jacques de Larosière and prepared at the request of the Commission and published on 25 February 2009, it was noted that the supervisory framework of the Union's financial sector had to be strengthened to reduce the risk of future financial crises and their seriousness, recommending deep reforms of the supervisory structure of this sector, including the creation of a European System of Financial Supervisors composed of three European Supervisory Authorities, respectively for the banking sector, for the insurance sector and occupational pensions and for the financial instruments and markets sector, and the creation of a European Systemic Risk Board.

Given that derivatives traded off-exchange (OTC derivative contracts) lack transparency, given that they are privately negotiated contracts and the relevant information is normally only accessible to the contracting parties, and that such contracts create a complex network of interdependencies which can make it difficult to determine the nature and level of risks incurred, so there is a clear uncertainty, the same that in the financial crisis has led to a reduction of economic security in times of tension on the markets, thus creating risks to financial stability. With Regulation 648/2012, the European Commission sets the conditions to mitigate these risks and improve the transparency of derivative contracts. At the Pittsburgh summit on 26 September 2009, the G20 leaders decided that by the end of 2012 all standardized OTC derivative contracts will have to be cleared by a central counterparty (CCP) and OTC derivative contracts will have to be reported to repertories of trading data, clear actions aimed at increasing the economic security of the parties to the OTC. In June 2010, the G20 leaders meeting in Toronto reaffirmed their commitment and also committed to accelerate the implementation of strong measures to increase the transparency and regulatory oversight of OTC derivative contracts in a uniform international and non-discriminatory manner.

EU Regulation No. 648/2012 sets bilateral offset and risk management obligations for over-the-counter (OTC) derivative contracts, reporting obligations for derivative contracts and uniform obligations for the exercise of assets; central counterparties (CCPs) and trade repositories. DefinesCCP: a legal entity that interposes itself between the counterparties of contracts traded on one or more financial markets acting as buyer for each seller and as a seller towards each buyer; trade repository: a legal entity that collects and maintains registrations on derivatives centrally.Compensation: the procedure to determine the positions, including the calculation of net bonds,

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and to ensure the availability of financial instruments or cash, or both, to cover exposures resulting from positions.

The introduction of a clearing obligation and the procedure to determine which CCPs can be used for this purpose may lead to undesired distortions of competition in the OTC derivatives market. For example, a CCP could refuse to offset transactions executed on certain trading venues because it belonged to a competing trading venue. In order to avoid such discriminatory practices, CCPs should agree to offset the operations performed in different trading venues, provided that the latter meet the technical and operational requirements defined by the CCPs, regardless of the basic contractual documentation on which the contractors have concluded the relative operation in OTC derivatives, provided that this documentation complies with market standards. Trading venues should provide CCPs with trading data in a transparent and non-discriminatory manner. The right of access of a CCP to a trading venue should allow agreements whereby multiple CCPs use data streams from the same trading venue. However, this should not lead to interoperability on derivatives clearing or creating liquidity fragmentation.

2 - OTC COMPENSATION OBLIGATION The regulation 648/2012/EU with the rule of article 4 paragraph 1 establishes the obligation of compensation: 1. The counterparties compensate all OTC derivative contracts belonging to a class of OTC derivatives declared to be subject to the clearing obligation in accordance with Article 5 (2) of the said Regulation if such contracts simultaneously satisfy the following two conditions: (a) have been concluded according to one of the following methods: i) between two financial counterparties, ii) between a financial counterparty and a non-financial counterparty meeting the conditions set out in Article 10 (1) (b); iii) between two non-financial counterparties fulfilling the conditions set out in Article 10 (1) (b), or iv) between a financial counterparty or a nonfinancial counterparty fulfilling the conditions set out in Article 10, paragraph (1) (b), and a subject established in a third country which would be subject to the clearing obligation if it were established in the Union; or v) between two subjects established in one or more third countries that would be subject to

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the clearing obligation if they were established in the Union, provided that the contract has a direct, material and predictable effect in the Union or where that obligation is necessary or appropriate to avoid circumvention of the provisions of this Regulation; and (b) are stipulated or novated: i) as from the date on which the clearing obligation commences; or ii) from the date of the notification referred to in Article 5 (1) but before the date on which the clearing obligation takes effect if the residual duration of the contracts exceeds the minimum residual duration established by the Commission pursuant to Article 5, paragraph 2, letter c).

Article 5 of Regulation 648/2012/EU defines the clearing obligation procedures in the following paragraphs 1. When a competent authority authorizes a CCP to offset a category of OTC derivatives pursuant to Article 14 or 15 , it shall immediately notify ESMA authorization (1°).

In order to ensure the consistent application of this Article, ESMA shall develop draft regulatory technical standards to specify the details to be included in the notifications referred to in the first subparagraph. ESMA shall submit those draft regulatory technical standards to the Commission by 30 September 2012. The Commission shall be empowered to adopt the regulatory technical standards referred to in the second subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.

2. Within six months of receipt of the notification referred to in paragraph 1 or the completion of the recognition procedure referred to in Article 25 (recognition of non-EU countries' CCPs), ESMA shall proceed with a public consultation and having consulted the ESRB (1°) and, where appropriate, the competent authorities of third countries, it prepare and presents to the Commission for approval draft regulatory technical standards specifying it how much follows: a) the category of OTC derivatives that to be subject to the clearing obligation referred to in Article 4; b) the date or the starting dates of the clearing obligation, with indication of any gradual application, and the categories of counterparties to which the obligation applies; and c) the minimum residual maturity of OTC derivative contracts as referred to in Article 4 (1) (b), point (ii).

3. On its own initiative, ESMA, having carried out a public consultation and consulted the ESRB and, where appropriate, the competent authorities of third countries, identify, in accordance with the criteria set out in paragraph 4 (a), (b) and (c), and notify the Commission of the categories of derivatives

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which should be subject to the obligation the compensation referred to in Article 4, but for which no CCP has yet obtained authorization.

After the notification, ESMA shall issue an invitation to draw up proposals for the compensation of these categories of derivatives.

4. For the general purpose of reducing systemic risk, draft regulatory technical standards for the part referred to in paragraph 2 (a) shall take into account the following criteria: a) the degree of standardization of contractual terms and operational processes of the category of OTC derivatives int eressata; b) the volume and liquidity of the relevant OTC derivatives category; (c) the availability of fair, reliable and generally accepted information for pricing purposes for the relevant OTC derivatives category.

In developing these draft regulatory technical standards, ESMA may take into account the interrelation between the counterparties who use the categories of OTC derivatives in question, the expected impact on counterparty credit risk levels between counterparties and the impact on competition in the Union. In order to ensure the consistent application of this Article, ESMA shall develop draft regulatory technical standards that further specify the criteria referred to in the first subparagraphs (a), (b) and (c). ESMA shall submit those draft regulatory technical standards to the Commission by 30 September 2012. The Commission shall be empowered to adopt the regulatory technical standards referred to in this paragraph, third subparagraph, in accordance with Articles 10 to 14 of the Regulation (EU) n.

1095/2010.

5. The draft regulatory technical standards for the part referred to in paragraph 2 (b) shall take into account the following criteria: a) the expected volume of the relevant OTC derivatives category; b) the existence of more than one CCP which already compensates the same category of OTC derivatives; c) the capacity of the CCPs involved to manage the expected volume and the risk deriving from the offsetting of the relevant OTC derivatives category; d) the type and number of counterparties active in the market or expected, for the relevant OTC derivatives category; e) the period of time necessary for a counterparty subject to a clearing obligation to prepare a mechanism to offset OTC derivative contracts through a CCP; (f) risk management and the legal and operational capacity of the various counterparties active in the market for the category of OTC derivatives concerned and affected by the clearing obligation pursuant to Article 4 (1).

6. If a category of contracts OTC derivative no longer has a CCP authorized or recognized for their compensation under this Regulation, it is no longer

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subject to the clearing obligation referred to in Article 4. Paragraph 3 of this Article shall apply.

(1°) NOTE: based in Paris, the European Securities and Markets Authority (ESMA) was created in 2010 to safeguard the stability of financial markets and resolve the shortcomings European financial supervision. The Regulation (EU) no. 1095/2010 of the European Parliament and of the Council, of 24 November 2010, establishing the European Supervisory Authority (European Securities and Markets Authority), amending decision no. 716/2009/EC and repealing the Commission Decision 2009/77/EC, creates the ESMA, a European Authority which strengthens the coordination between national financial market regulatory authorities and ensures the uniform application of Community financial legislation in countries of the European Union (EU).

Aesfem develops regulatory technical standards based on EU financial legislation. It also has the power to issue guidelines and recommendations on the application of European legislation. Its task is to promote transparency, simplicity and equity in the markets to protect consumers of financial products. Among its tasks, it monitors financial assets and analyzes consumer trends. Under certain strict conditions, it may temporarily prohibit or restrict financial assets that pose a threat to market stability. The ESMA can investigate a violation of the law by a national authority. This occurs when the latter fails to ensure that a financial market participant complies with European law. Within two months, ESMA can issue a recommendation requiring the national authority to take the necessary measures to comply with European law. Thus, the European Commission can formulate a formal opinion. If failure to comply with the national authority persists, the ESMA can directly take a decision against a single financial market participant under certain strict conditions. This decision prevails over previous decisions taken by the national authority. Aesfem is part of the European financial supervisory system, created in 2010 and which includes three other supervisory bodies: 1) AEAP: the European Insurance and Occupational Pensions Authority based in Frankfurt. 2) ABE: the European banking authority based in London.

3) CERS: the European Systemic Risk Board based in Frankfurt.

With the rule of article 10 paragraph 1, EU regulation 648/2012 establishes that when a non-financial counterparty assumes positions in OTC derivative contracts and these positions exceed the netting threshold, it fulfills the following obligations: a) notify immediately to ESMA and to the competent authority referred to in paragraph 5 exceeding the threshold; b) becomes subject to the clearing obligation pursuant to Article 4 for future contracts if the moving average at thirty business days of its positions exceeds the

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threshold; and (c) compensate for all future contracts within four months of the date on which it becomes subject to the clearing obligation.

The same article in paragraph 2 establishes that a non-financial counterparty has become subject to the clearing obligation pursuant to paragraph 1 point (b), and which subsequently demonstrates to the authority designated pursuant to paragraph 5 that the moving average at thirty working days of its positions does not exceed the set-off threshold, is no longer subject to the clearing obligation referred to in 4. Paragraph 3 of the same article sets out provisions for the calculation of the positions of a non-financial counterparty in OTC derivatives, in particular it states that in the calculation the non-financial counterparty includes all OTC derivative contracts entered into by itself or other entities non-financials of the group to which the non-financial counterparty belongs for which it is not objectively measurable ability to reduce risks directly related to the non-financial or group counterparty's commercial or cash-financing business. The obligations arising from the application of EU regulation 648/2012 for non-financial counterparties vary depending on whether they are qualified or less: qualified has the obligation of compensation, risk mitigation and reporting. Unqualified has the obligation to report and implement some of the risk mitigation techniques. Companies assume the qualified counterparty status if the average portfolio value for each category of derivative contracts, calculated in a period of thirty working days, exceeds the following predefined thresholds, identified by type of derivatives: â‚Ź 1 billion for OTC derivative contracts on credit and shares, â‚Ź 3 billion for OTC derivative contracts on: interest rates, foreign currencies and all other OTC derivatives that do not fall under the previous types.

Reliable data are needed to define the categories of OTC derivative contracts to be subject to the clearing obligation, the thresholds and and non-financial counterparties of systemic importance. Therefore, for regulatory purposes, a uniform reporting requirement on derivatives should be introduced at Union level. An ex-post reporting obligation is also required, to the greatest extent possible, for both financial and non-financial counterparties, in order to provide comparative data to ESMA and to the competent authorities concerned.

An intra-group transaction (Article 3 of EU Regulation 648/2018) is an operation between two companies that are integrally incorporated in the same consolidation and subject to adequate centralized assessment procedures , measurement and control of risks. Such undertakings shall adhere to the same institutional protection system as set out in Article 80 (8) of Directive

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2006/48/EC, or, in the case of credit institutions related to the same central body, referred to in Article 3 (1) of the aforementioned directive, both are credit institutions or one is a credit institution and the other a central body (central subject responsible for the risk control of a credit institution). OTC derivative contracts may be recognized within financial or non-financial groups as well as mixed groups of financial and non-financial corporations and if they are considered an intra-group transaction for a counterparty, such contracts should also be considered as such for the other counterparty of the contract. It is recognized that intragroup transactions may be necessary to aggregate risks within a group structure and that therefore intragroup risks they have an their own specificity. Since making these transactions subject to the clearing obligation could reduce the efficiency of these intragroup risk management processes, it may be appropriate to derogate from this obligation for intra-group transactions, provided that there is no increase in systemic risk (general risks). Consequently, if useful to mitigate the infragroup counterparty credit risks, for such transactions it would be advisable to replace the CCP compensation with an adequate exchange of guarantees.

However, some infragroup transactions could be exempted, in some cases on the basis of the decision of the competent authorities, from the collateralisation obligations provided that the respective risk management procedures are sufficiently robust, robust and consistent with the level of complexity of the transactions and there are no impediments hindering the rapid transfer of own funds or repayment of liabilities between counterparties.

These criteria and the procedures that the counterparties and competent authorities concerned must follow in applying the exemptions should be specified in the regulatory technical standards adopted in accordance with the ESA-establishing regulations (2°). Before drawing up draft regulatory technical standards, the ESAs should prepare an assessment of the potential impact on the internal market, on financial market participants and in particular on the operations and structure of the groups concerned. All the technical rules applicable to guarantees exchanged in intercompany transactions, including the exemption criteria, should take into account the pre-eminent specificities of such transactions, the differences between financial and non-financial counterparties and the respective purposes and methods for using derivatives.

Paragraph 2 of article 4 of the EU regulation number 648 of 2012 establishes that OTC derivative contracts that constitute infra-group transactions as described in article 3 are not subject to the obligation to set-off, without prejudice to risk mitigation techniques pursuant to Article 11.

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It also establishes that the exemption referred to in the first subparagraph shall only apply: a) if two counterparties established in the Union and belonging to the same group have previously notified in writing to their competent authorities their intention to avail itself of the exemption for the OTC derivative contracts entered into among them. Notification takes place at least thirty calendar days before the exemption is exercised. Within thirty calendar days following receipt of the notification, the competent authorities may object to the exemption exercise if the transactions between the counterparties do not meet the conditions set out in Article 3, without prejudice to the competent authority's right to object after expiry of this period, thirty day if the conditions in question are no longer satisfied. In the event of disagreement between the competent authorities, ESMA may assist them in seeking an agreement in accordance with the powers conferred on it pursuant to Article 19 of Regulation (EU) No 1095/2010; b) OTC derivative contracts entered into between two counterparties belonging to the same group and established in a Member State and in a third country, if the counterparty established in the Union has been authorized by its competent authority to apply the exemption within thirty calendar days of the notification of the counterparty established in the Union, provided that the conditions set out in Article 3 are fulfilled. The competent authority shall inform ESMA of this decision.

(2°) NOTE: On 23 September 2009, the Commission adopted three proposals for regulations establishing the European System of Financial Supervision and creating three European Supervisory Authorities (ESAs) with the task of contributing to the uniform application of Union law and the development of common standards and practices of high quality regulation and supervision. The ESAs include the European Supervisory Authority (European Banking Authority) (EBA) established by Regulation (EU) no.

1093/2010 of the European Parliament and of the Council, the European Supervisory Authority (European Insurance and Occupational Pensions Authority) (AEAP) established by Regulation (EU) no. 1094/2010 of the European Parliament and of the Council and the European Supervisory Authority (European Securities and Markets Authority) (ESMA) established by Regulation (EU) no. 1095/2010 of the European Parliament and of the Council. The ESAs will play a crucial role in safeguarding the stability of the financial sector. It is therefore essential to guarantee at all times that the work they carry out is of high political priority and that adequate resources are allocated to them.

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With the EU regulation 648/2012, the counterparties are considered as belonging to the same consolidation at least when they are both merged into a consolidation within the meaning of Article 1 of Council Directive 83/349/EEC repealed by Directive 2013/34/EU (object of study in publication 2019-20,01) or on the basis of International Financial Reporting Standards (IFRS) adopted pursuant to Regulation (EC) no. 1606/2002 of the European Parliament and of the Council or, for a group whose parent company is headquartered in a third country, on the basis of accounting standards generally accepted by a third country recognized as equivalent to IFRS in accordance with Regulation (EC) n. 1569/2007 of the Commission or accounting standards of a third country whose use is permitted pursuant to Article 4 of Regulation (EC) No 1569/2007, or when both are covered by the same consolidated supervision pursuant to Directive 2006/48/EC, a directive governing access to the activity of credit institutions and its exercise, as well as the prudential supervision of such institutions. The counterparties are both considered to belong to the same consolidation even in the condition in which both are covered by the same consolidated supervision pursuant to Directive 2006/49/EC of the European Parliament and of the Council, which establishes the capital adequacy requirements and which apply to investment firms and credit institutions, defines the related calculation rules and rules for their prudential supervision for the purposes of Regulation 648/2012/EU and with reference to the exemption of the obligation to offset OTC contracts when deemed to be intra-group transactions between two consolidated companies (pursuant to Article 4 paragraph 2 of Regulation 648/2012/EU), is considered consolidated group an group with a parent company in a third country and subject to the same consolidated supervision as the competent authority of a third country established as equivalent to that governed by the principles set out in Article 143 of the Directive 2006/48/EC or in Article 2 of Directive 2006/49/EC (both Directives have been repealed by Directive 2013/36/EU). With the regulation 1606/2002/CE the commission has as its objective the adoption and use of international accounting principles in the Community to harmonize the financial information presented by the companies referred to in article 4 of the same, in order to guarantee a high the level of transparency and comparability of financial statements and thus the efficient functioning of the Community market of capital and the internal market. Regulation 1569/2007/EC establishes a mechanism for determining the equivalence of accounting standards applied by issuers of third country securities, establishing the conditions under which the Generally Accepted Accounting Principles of a third country can be considered equivalent to International Financial Reporting Standards (hereinafter IFRS) and introduces a mechanism for determining such equivalence.

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The European Commission with Regulation 648/2012/EU defines rules that allow the establishment of a CCP in any Member State. No Member State or group of Member States should be discriminated, directly or indirectly, as a location for clearing services. Nothing in this Regulation should limit or prevent a CCP of a jurisdiction from compensating a product named in the currency of another Member State or a third country. It lays down rules that restrict the authorization of a CCP to hold an initial minimum capital, considering it appropriate that the capital, including undistributed profits and CCP reserves, be at any time proportionate to the risk arising from the activities of the CCP, in order to ensure that it is adequately capitalized in order to cope with credit, counterparty, market, operational, legal and commercial risks that are not already covered by specific financial resources and can proceed, if necessary, to restructuring or liquidation ordered of its activities. As the regulation introduces, for regulatory purposes, a legal obligation of compensation through specific CCPs, it is essential to ensure that these are safe and sound and comply at all times with the rigorous organizational, professional and prudential requirements set by this regulation. In order to ensure uniform application of this Regulation, these requirements should apply to the clearing of all financial instruments processed by the CCP. The European Commission considers it necessary, for harmonization and regulatory purposes, to ensure that counterparties only use CCPs that meet the requirements set by this Regulation. These requirements should not prevent Member States from adopting or continuing to apply additional requirements for CCPs established in their territory, including certain authorization requirements under Directive 2006/48/EC. However, the imposition of such additional requirements should not affect the right of CCPs authorized in other Member States or recognized in accordance with this Regulation to provide clearing services to the direct participants and their clients established in the Member State introducing the additional requirements, in that the aforementioned CCPs are not subject to these requirements and are not required to comply with them. By 30 September 2014, ESMA should draw up a report on the impact of the application of additional requirements by the Member States.

With the Regulation (EU) 648/2012, the European Commission establishes the set of implementing rules on the authorization and supervision of CCPs, considering it an essential corollary of the obligation to offset OTC derivative contracts. It establishes that the competent authorities retain responsibility for all aspects of the authorization and supervision of CCPs, including the responsibility for verifying compliance by the applicant CCP with this

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Regulation and with Directive 98/26/EC of the European Parliament and of the Council of 19 May 1998 on the definitive nature of the regulation in payment systems and securities settlement systems, given that national competent authorities are best placed to assess the day-to-day functioning of the CCP, to carry out regular checks and to adopt if necessary, suitable measures. When a CCP risks insolvency, the responsibility for public finance action may fall mainly on the Member State in which the CCP is established.

Consequently, the powers for the authorization and supervision of CCPs should be exercised by the competent authority of that Member State.

However, given that the direct participants of a CCP can be established in different Member States and will be the first to be affected by the failure of the CCP, it is essential that all the competent authorities and ESMA participate in the authorization procedure and supervision. This will avoid divergent national measures or practices and the creation obstacles to the proper functioning of the internal market. Furthermore, no proposal or measure by a member of a college of supervisors should discriminate, directly or indirectly, a Member State or a group of Member States as the seat of clearing services in any currency. ESMA should participate in each college in such a way as to ensure the consistent and correct application of this Regulation. ESMA should involve other competent authorities of the Member States concerned in the preparation of recommendations and decisions.

Regulation 648/2012 / EU underwent minor modifications by the Directive 2015/849/EU amending article 25, paragraph 2, letter d) point replaced by the following: «d) the CCP has its headquarters or is authorized in a country third, whose national anti-money laundering and counter-terrorist financing system does not present, in the Commission's opinion, in accordance with Directive (EU) 2015/849 of the Parliament and of the Council, strategic weaknesses posing significant threats to the Union's financial system. Previous amendments were made by Regulation 575/2013 on prudential requirements for credit institutions and investment firms that it added at the Title IV, the Chapter 4, in relation the calculation of the hypothetical capital KCCP necessary for the determination of the exposure value of a institution (QCPP) for the pre-funded contribution from the guarantee fund of a Central Counterparty. Further changes have been made by Article 53 of the Regulation (EU) No. 600/2014 and Article 32 of Regulation (EU) 2015-2365 the latter concern the definition of OTC derivatives or OTC derivative contracts by distinguishing between transactions with OTCs in regulatory markets and in non-regulatory markets ; the same amendments introduce Article 2 bis which establishes the conditions of equivalence so that third country markets can be considered regulatory as defined by Directive 2004/39 / EC (and subsequent amendments).

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3 - CAPITAL OF SURVEILLANCE AND PRUDENTIAL REQUIREMENTS FOR CREDIT INSTITUTIONS. In recent years, the EU has implemented a substantial reform of the financial services regulatory framework aimed at strengthening the resilience of institutions (credit institutions and investment firms) operating in the EU financial sector and based to a large extent on standards agreed at worldwide with international partners. The reform package included regulation (EU) no.

575/2013 (Capital Requirements Regulation or CRR), Directive 2013/36/EU (Capital Requirements Directive or CRD) on prudential requirements and supervision of institutions, Directive 2014/59/EU (rehabilitation and resolution directive of banks or BRRD, harmonized rules for all European countries aimed at preventing and managing the crises of banks and investment firms) and Regulation (EU) no. 806/2014 (Single Resolution Mechanism Regulation or SRM, an EU-wide system for the resolution of insolvent financial institutions and includes rules on capital requirements, on the protection of depositors, on the prevention and management of bank failures). These measures were adopted in response to the financial crisis that broke out in 2007-2008 and reflect internationally agreed standards. Despite having made the financial system more stable and resilient to the many types of possible shocks and future crises, the reforms do not yet fully address all the problems identified. In response, the European Parliament and the Council, on 23-112016, presented in Brussels the proposal to amend Directive 2013/36/EU (Capital Requirements Directive or CRD), a proposal that is part of a legislative package also including amendments to the regulation (EU) no.

575/2013 (Capital Requirements Regulation or CRR), of Directive 2014/59/EU (Bank Resolution and Resolution Directive, BRRD) and of Regulation (EU) no. 806/2014 (Single Resolution Mechanism Regulation or SRM). Currently, in the year 2018, the Directive 575/2013/EU and the 2013/36/EU Directive of interest for the studies of this publication remain in force.

Regulation 575/2013/EU contains, inter alia, the prudential requirements for entities closely related to the functioning of the banking and financial services markets and which aim to guarantee the financial stability of the operators in these markets, as well as a high level of protection of investors and depositors. The same regulation is intended to make a decisive contribution to the proper functioning of the internal market.

Directives 2006/48/EC and 2006/49/EC, although to a certain extent harmonized the provisions of the Member States on prudential supervision, provide for a significant number of options and possibilities for Member States

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to impose more stringent those provided for by those directives. This results in disparities between national rules, which could hinder the cross-border provision of services and the freedom of establishment and thereby create obstacles to the proper functioning of the internal market. For reasons of legal certainty and the need for a level playing field within the Union, a single set of rules for all market participants is a key element for the functioning of the internal market. With the adoption of Regulation 575/2013/EU, all institutions are subject to the same rules throughout the Union, which also reinforces confidence in the stability of institutions, especially in times of stress; the same regulation reduces the complexity of regulation and costs for compliance with the law, in particular for institutions operating on a crossborder basis, and helps to eliminate distortions of competition.

Small and medium-sized enterprises (SMEs) play a key role in creating economic growth and securing employment. The recovery and future growth of the Union economy depends to a large extent on the availability of capital and funding to enable SMEs established in the Union to make the necessary investments to adopt the new technologies and equipment needed to increase their competitiveness. The limited number of alternative sources of financing has made SMEs established in the Union even more sensitive to the impact of the banking crisis. It was important to close the current gap on SME financing and ensure an adequate flow of bank loans to SMEs in the current context; in fact, the EU regulation 575/2013 reduces the capital coverage of credit institutions with a support factor equal to 0,7619. With the provision of article 502 of the same regulation, the provisions are defined so that credit institutions can effectively use the capital requirements reduction, deriving from the application of the support factor, for the sole purpose of ensuring an adequate flow of loans to established SMEs in the Union.

Institutions shall report to the competent authorities every three months on the total amount of exposure to SMEs, the total amount,including any default exposures (3°) due to the istitution or its parent companies and its subsidiaries by the debtor client or group of related debtor customers, excluding potential receivables or credits secured by residential property, which must not exceed 1.5 million of EUR. The competent authorities shall periodically monitor the total amount of credit institutions' exposures to SMEs and the total amount of the capital deduction.

(3°) NOTE: in finance is defined as default situation (insolvency) the technical inability of an issuer to comply with the contractual clauses provided for in the financing regulations. For example, it is the situation in which a state incurs when it declares insolvency or bankruptcy (sovereign insolvency). The default can be formal or substantial: formal, where an issuer does not comply with

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certain hedging or capital ratios such that the loan could undergo a significant change in its creditworthiness; substantial when an issuer is not physically able to pay the interest or repayment installments of the capital at the natural expiry of each.

Default after Basel 2. The Basel 2 agreement changed the definition of default of the taxable person in an important and objective way. Default exposures include: non-performing loans, substandard loans, restructured loans, overdue and/or overdrawn credits.

Suffering: exposure to a counterparty in a state of insolvency (even without judicial assessment) or in a comparable situation, regardless of loss forecast formulated by the bank and by the presence of collateral.

Uncontrolled: exposure to a counterparty in temporary difficulty (defined on the basis of objective factors) that is considered to be exceeded in a reasonable period of time.

Refurbished credit: exposure in which a bank or a pool of banks, due to the deterioration of the economic and financial situation of the debtor, has, have changed the original conditions of the loan (rescheduling of terms, reduction of the interest rate), resulting in the emergence of a loss.

These include expired credits and, or those exceeding for which: 1) the debtor is late on a credit obligation to the bank or banking group for over 90 days; 2) the "relevance" threshold is equal to 5% of the exposure (the overdraft). For retail exposures, banks may adopt a default definition at the level of individual transactions, limited to overdue or overdrawn credits, if consistent with their management practices. For corporate loans, the crossdefault clause applies, ie insolvency on a credit line causes the default of all claims against the debtor. The following changes to the original contractual conditions do not lead to default: a) rescheduling of receivables and granting of extensions; b) extensions, renewals or extensions of credit lines. These changes must not depend on the deterioration of the economic-financial conditions of the debtor or must not give rise to a loss.

Rescheduling is a way of restructuring the debt, that is a change in the conditions of the loan, by a State or a company that is no longer able to meet its obligations to creditors. The rescheduling provides for the extension of the deadlines for reimbursements. The other two ways of restructuring the debt may instead concern and modify the interest rate applied or the principal through a haircut, or a cut in the nominal value of the securities in the portfolio.

Regulation 575/2013/EU establishes uniform rules concerning the general prudential requirements that institutions subject to supervision pursuant to

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Directive 2013/36/EU (authorized by the Authority) satisfy with regard to the following elements: a) requirements with regard to own funds relating to credit risk, market risk, operational risk and settlement risk, which are fully quantifiable, uniform and standardized (we will examine the risks in the paragraph "risks for credit institutions"); b) requirements limiting large exposures; c) liquidity requirements relating to liquidity risk elements; fully quantifiable, uniform and standardized (which have a weighting factor of 100% since 2018); d) reporting obligations under subparagraphs a), b) and c) and financial leverage; e) public disclosure obligations.

This regulation does not define publication obligations for the authorities competent in the field of prudential regulation and supervision of institutions referred to in Directive 2013/36/EU, obligations fully contained in the same Directive 2013/36/EU and therefore that they would have been unnecessarily repeated; it also does not prevent institutions from applying stricter prudential requirements, therefore, from holding own funds and their excess components or from applying stricter measures than those set out in this regulation. Said rules for the application of prudential requirements both on an individual basis and on a consolidated basis of credit institutions.

Of interest for this research is part two of the regulation on own funds and the definition of Tier 1 capital made up of the sum of the primary capital of class 1 and of the additional capital of class 1. In accordance with the CBVB decision, approved by the GHOS the January 10, 2011, all the Tier 1 capital instruments and all the Tier 2 capital instruments of an institution may be fully deducted on a permanent basis or fully converted into Tier 1 capital at the time the institution it is not profitable. The necessary legislation to ensure that own funds instruments are subject to the additional loss absorbing mechanism is incorporated into Union law as an integral part of the institutions' reorganization and resolution requirements.

With Article 26 of Regulation 575/2013/EU, the European Commission establishes rules for the definition of primary capital of class 1 (of greater

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interest for this paragraph), rules that define the elements of primary capital of class 1: a) capital instruments, provided that the conditions set out in Article 28 or, where applicable, Article 29 are met; b) share premiums for the instruments referred to in point (a); c) retained earnings; d) other accumulated income statement components; e) other reserves; f) funds for general banking risks.

Elements referred to in letters c) to f) are recognized as primary capital of class 1 only if they can be used without restriction and without delay by the institution to cover risks or losses at the time they occur.

Profits not distributed, letter c), may include interim or year-end earnings before that the institution adopt a formal decision confirming the final result for the reference year only with the prior authorization of the competent authority.

The competent authority shall grant the authorization if the following conditions are met: a) the profits have been verified by persons independent of the body responsible for auditing the accounts of the institution itself; b) the has shown satisfactorily, in the opinion of the competent authorities, that the amounts of these profits are net of all foreseeable charges and dividends.

A verification of the interim or final year profits of the institution satisfactorily guarantees that these profits have been valued in accordance with the principles set out in the applicable accounting framework (principles of international accounting: Regulation (EC) No. 1606/2002 - Regulation (EU) No. 2016/1905 - Regulation (EU) No. 2016/2067). Competent authorities shall assess whether the emissions of Tier 1 capital instruments meet the criteria set out in Article 28 or, where applicable, in Article 29. With regard to subsequent issues to 31 December 2014, institutions classify capital instruments as primary instruments of class 1 capital only with the prior approval of the competent authorities, which may also consult the EBA. As regards capital instruments, with the exception of State aid, which the

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competent authority considers classificating as primary capital instruments of class 1, but with regard to which the EBA considers it materially complex to establish compliance with the criteria set out in Article 28 or, where applicable, Article 29, the competent authorities shall explain their motivations to the EBA. On the basis of information from each competent authority, EBA shall develop, update and publish a list of all forms of capital instruments of each Member State which are eligible to be considered primary class 1 capital instruments. The EBA has drawn up this list and published it for the first time by 1 February 2015. EBA may after the review process referred to in Article 80 (continuous review of the quality of own funds instruments issued by institutions) and when there is significant evidence of the non-compliance of these instruments with the criteria set out in Article 28 or, where applicable, in Article 29, decide to remove from the list instruments that do not constitute State aid issued after 31 December 2014 and can spread a communication about it. Develops draft regulatory technical standards to specify the meaning of "foreseeable" when determining whether foreseeable charges and dividends have been deducted. He presented the draft regulatory technical standards to the Commission to which the power to adopt the regulatory technical standards is delegated pursuant to Articles 10 to 14 of Regulation (EU) No 1093/2010.

Article 27 defines the conditions for the Tier 1 capital instruments issued by the institutions, defined as such under the applicable national law and with the requirements to be considered by the relevant competent authorities, mutual societies, cooperatives, savings institutions or similar bodies. Article 28 defines the conditions for capital instruments to be considered primary capital instruments of class 1. Article 36 paragraph 1 defines the elements of primary capital that must be deducted such as losses for the year, intangible assets, deferred tax assets that are based on future profitability, the negative amounts resulting from the calculation of expected losses for institutions that calculate risk weighted exposure amounts using the internal rating method (IRB approach, paragraph "Risks for a credit institution"), the assets of pension funds with benefits, defined in the financial statements the institution's, and the other elements indicated in letter e) to l): the applicable amount of the Tier 1 capital instruments of financial sector entities held by the institution directly, indirectly and synthetic way, both when the institution does not have a significant investment in these subjects and when l investment is significant; j) the amount of items to be deducted from additional Tier 1 items in accordance with Article 53 which exceeds the institution's Tier 1 additional capital, (restrictions on the cancellation of distributions on additional Tier 1 instruments and items that could hinder the recapitalization of the institution,

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capital increase); k) the amount of the exposure of the following elements, which have the requisites to receive a risk weighting factor of 1250%, when, as an alternative to the application of a risk weighting factor of 1250%, the entity deducts the amount of the exposure from the amount of Tier 1 capital items: - qualifying holdings outside the financial sector; ii - positions towards securitization (4°), in accordance with Article 243 (1) (b), Article 244 (1) (b) and Article 258 ( credit derivatives with a weighting factor of 1250%); iii transactions with non-contextual settlement, in accordance with Article 379, paragraph 3; iv - positions in a basket for which an institution is not in a position to establish risk weightings under the IRB approach, in accordance with Article 153 (8); v - equity exposures within the framework of the internal models method, in accordance with Article 155 (4) (possible exposure for equity-related loss, weighted for the related risk); l) any tax relating to the elements of primary Tier 1 capital which can be expected at the time it is calculated, with the exception of cases where the institution consequently adapts the amount of Tier 1 capital elements, to the extent that such taxes reduce the amount up to which these items may be used to cover risks or losses; (between the following paragraphs of the regulation, are defined the activities of the EBA and of the Commission on the elements deductible from the primary capital of class 1). The following articles define detailed provisions for the deduction of capital elements from primary capital of class 1, including thresholds for exemption from the deduction of tax assets that depend on future profitability and derive from temporary differences and the instruments of primary capital of class 1 of the subject in the financial sector in which the institution which holds them has a substantial investment. The primary capital of class 1 of an institution consists of the elements of primary capital of class 1 after the adjustments, deductions and exemptions provided for in articles 32 to 49 of regulation 575/2013/EU, with applied the exceptions of article 79. Article 79 defines provisions for temporary exceptions to the deduction from own funds of an institution when it holds capital instruments or has granted subordinated loans (the repayment of which is subject to the full repayment of all other creditors), where applicable, as primary class 1 capital, additional class 1 instruments or class 2 instruments in a financial sector entity on a temporary basis and the competent authority considers that such detentions exist for the purposes of a financial assistance operation for the purpose of reorganization and rescue of the subject, the competent authority may, on a temporary basis, derogate from the provisions on deduction which would be applicable to such instruments.

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NOTE (4°): The securitization process consists of the transformation of an undivided financial asset, for example a credit, into a divided and salable asset: assets and/or liabilities, assets and/o debts from individuals or loans of a company (usually a bank) defined as technically originator, through which emissions are built with the transformation of the asset or debt / credit (securitization) into bonds, ("paper"). For example, suppose the bank has a number of real estate loans among its assets; the bank may decide to securitise them, that is, to issue securities that are guaranteed by mortgages.

These securities are then sold to private or institutional investors, and so the bank recovers some money lent to borrowers: the funds that the bank gets can be used to expand its business. Securities, like normal bonds, have a maturity and an interest rate, and the debt service is linked to repayments and interest payments by the original borrowers. The bank, in addition to the advantage of mobilizing those assets that are not liquid, reduces or eliminates the risk associated with the related mortgages, reducing the own funds bound for capital requirements to cover the related risk: the risk is passed on to investors. Securitizations have different ways of transferring risk. In the case of mortgages, for example, they loosen the relationship between lender and borrower and can therefore lead, as happened in America in the case of subprime, to a too easy concession of real estate loans. Among the reforms aimed at mitigating this problem is the imposition of an obligation to maintain in the financial statements of the institution that securitizes a portion of the securitized securities, so as to align the interests of investors with those of the issuer. The English term subprime refers to loans that, in the US financial context, are granted to a subject that can not access to market interest rates, as it has had previous problems in its debtor history; in the face of greater risk, the mortgage it is burdened by a higher interest rate and higher charges.

The technique is a modern elaboration of the idea of Johan Palmstruch in 1647; idea that gave rise to the modern system of central banks (debt factories) and commercial banks, as we know them today. The dynamics that constitute the securitization activities can synthetically be described as follows: a subject, called originator, collects a certain number of credits on the market (for example, interest on mortgages). The originator will subsequently transfer the credits to a Special Purpose Vehicle (SPV) and will enter its availability. The SPV will receive, from that moment on, the payments for interest and for the repayment of the capital, made by those who have signed mortgages. The SPV, to finance itself, will issue bonds that are subscribed by investors who have a surplus (excess) of liquidity. These bonds are structured in tranches, and each of them is assigned a rating for the weighting of the related risk. Ordered starting from the least risky, which consequently coincides with the less profitable, the tranches can be distinguished

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in: senior tranches, tranchesmezzanine, tranches equity, trances constituting the well-known senior securities, mezzanine securities, equities & securities, available in the bond market (stock exchange). The payment of the tranches takes place in cascades, that is, the less risky tranches are paid first (senior) and then the most risky tranches (mezzanine and equity). The subdivision in tranches allows the distribution of risk: senior, less risky tranches that guarantee lower interests may be subscribed by parties with little risk appetite; the equity tranches will allow greater speculation by the investor, provided that he has a greater risk appetite. The interest paid by the borrowers of the underlying loans will be used to pay the interest expense of the bonds. Securitization allows a bank to transform assets by definition nonliquid (like a mortgage) in activity liquid. This is done because by transferring the financing to the SPV, it will be obtained. the consideration in cash (obviously giving the right to the repayment of the capital and the interest of the loan by the contractor), increasing its liquidity & agrave; and being able to also replicate the process, then grant further mortgages and subsequent securitization of the same. The Special Purpose Vehicle is normally not required to respond to any failure of the originator.

In Chapter 3 of Title I, from Article 52 to Article 55 of Regulation 575/2013/EU, the additional Tier 1 capital is defined, consisting of additional Class 1 items after deductions of the elements specified in the section 2, articles from 56 to 60; in Section 1 of Chapter 3, Title I, additional Tier 1 capital elements and instruments are also defined. Section 2 of the same title defines the provisions for additional elements and instruments to be deducted from Tier 1 additional capital; in the definition of additional Tier 1 capital, any exemptions established by Article 79 are applied.

Chapter 4, title I, section 1 defines the elements and instruments of class 2; in the following section 2 the elements to be deducted are defined (articles from 62 to 70). The Tier 2 capital of an institution consists of the class 2 items after the deductions defined in Article 66 of Article 70 and the application of Article 79.

EXAMPLE: that the Tier 1 primary capital items may consist of equity instruments and related share premiums issued by the institution, entirely paid and not purchased or financed by the institution (shares issued directly by the institution). We may consider, as an example, additional Tier 1 capital items the equity instruments not directly issued by the institution (or if issued directly by the institution that do not comply with the conditions of articles 28 and 29), fully paid up, the purchase of which is not carried out by the

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institution or financed by it, or subsidiaries; (a company in which the institution holds a direct or a controlling interest of 20% or more of the voting rights or capital of the enterprise). The additional Tier 1 capital instruments are of a lower class than the class 2 instruments in case of insolvency of the institution, furthermore the additional elements also include the issue price premium of the same instruments. We may consider Tier 2 capital items the equity instruments and related surcharges issued by the subsidiaries or issued by the institution and not considered class 1 according to the conditions imposed by Articles 28 and 29 of Regulation 575/2013/EU or additional class 1 according to the conditions imposed by Article 52 of the same regulation, fully paid where both the institution and its subsidiaries do not acquire the equity instruments (shares issued by financial subsidiaries, in which the institution controls 20% or more directly or through a control bond); it includes subordinated loans and subordinated loans fully paid up and which are not allocated by them (institution and relative subsidiaries). In Tier 2 capital items and for institutions that are authorized to calculate risk weighted exposures using the IRB method, generic credit risk adjustments may be included, gross of tax effects, up to 1.25% of the amounts of risk weighted exposures calculated according to the IRB method; for the same institutions, the positive amounts, gross of the tax effects, resulting from the calculation of the expected loss amounts, referred to in Articles 158 and 159 up to 0.6% of the risk weighted exposure amounts calculated in accordance with IRB method. Articles 158 and 159 of Regulation 575/2013/EU establish provisions for the calculation and treatment by type of exposure of expected loss amounts; for this example: institutions subtract losses from value adjustments on general loans. At the end of the example it should be noted that the additional Tier 1 capital instruments can also be converted into primary class 1 instruments upon the occurrence of an activating event defined in Article 54, with a clear reference to the instruments directly issued by the institution in compliance article 28 (1) (a), unless a merger exists between the institution and a subsidiary with the prior authorization of the authority competent; for example securities convertible into shares.

The definition of own funds is contained in Article 72 of Regulation 575/2013/EU: the own funds of an institution consist of the sum of its capital of class 1 and class 2. With the article 78 conditions are enacted for the institution to reduce own funds on the authorization of the supervisory authority, for to repurchase fully or partially or to repay, also in advance, instruments of primary capital of class 1, additional instruments of class 1 or instruments of class 2. The Article 79 defines the possibility of temporary derogations from the deduction of equity instruments from own funds. The

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EBA shall monitor the quality of the own funds instruments issued by institutions (Article 80) throughout the Union and shall immediately inform the Commission when there is significant evidence of the non-compliance of these instruments with the criteria referred to in Article 28 or, where applicable, in Article 29. The competent authorities shall transmit without delay, upon the request of EBA, all information that the latter considers relevant with respect to the new capital instruments issued, in order to enable EBA to monitor the quality of the instruments of own funds issued by institutions throughout the Union. The notification with which EBA informs the European Commission contains the following: a detailed explanation of the nature and extent of the identified deficiency, a technical opinion on the action of the Commission that the EBA deems necessary, significant developments in the EBA methodology for stress tests on the solvency of institutions.

Provides technical advice to the Commission on any significant change deemed necessary to define own funds as a result of any of the following factors: developments affecting market rules or practices, changes in the relevant legal or accounting rules, significant developments in the EBA methodology for stress tests on the solvency of institutions. By 31 January 2014, EBA provided technical advice on the possible treatment of unrealized gains measured at fair value, beyond the inclusion in primary capital of class 1 without adjustments. These recommendations have taken into account developments that have affected international accounting standards and international agreements regarding prudential rules for banks.

The European Commission with Articles 82 to 88, Title II of Regulation 575/2013/EU, issues provisions concerning minority holdings and Tier 1 capital instruments and Tier 2 capital instruments issued by subsidiaries; with Article 89, it issues provisions on risk weighting and the prohibition of qualifying holdings outside the financial sector. In paragraph 1 of Article 89, it is established that a qualified holding, the amount of which exceeds 15% of the institution's eligible capital, in a single undertaking which is not one of the following, is subject to the provisions of paragraph 3, of the same article: (a) a financial sector entity; (b) an undertaking other than a financial sector entity carrying out activities which the competent authority considers to be one of the following: (i) direct extension of the financial sector banking; ii) auxiliary banking services; iii) leasing, factoring, management of mutual funds, management of "IT services" or similar activities. Paragraph 2 of the same article establishes that the total amount of qualifying holdings that an institution holds in companies (even if for each individual undertaking does not exceed 15%) other than those referred to in paragraph 1 (a) and (b), which exceeds 60% of its eligible capital is subject to the provisions of

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paragraph 3. In paragraph 3 the requirements a) and b) which the authorities apply to the qualifying holdings of the institutions referred to in paragraphs 1 and 2 are established: a) for the purposes of calculating the capital requirement, in accordance with part three of the regulation (capital requirements), institutions shall apply a risk weighting factor of 1250% (5°) at the higher of the following amounts: (i) the amount of qualifying holdings referred to in paragraph 1 that exceeds 15% of the eligible capital; (ii) the total amount of qualifying holdings referred to in paragraph 2 that exceeds 60% of the eligible capital of the institution; b) the competent authorities prohibit institutions from holding the qualified holdings referred to in paragraphs 1 and 2 on whose amount exceeds the allowable capital percentages referred to in those paragraphs. The competent authorities publish the choice made between a) and b). In accordance with Article 16 of Regulation (EU) no.

1093/2010, the EBA has the task of issuing guidelines that specify the following concepts: a) the activities that constitute the direct extension of banking activity; b) the auxiliary activities of banking activity; c) similar activities.

NOTE (5°): as we will see in the paragraph "risks for a credit institution" the weighting factor intervenes in the calculation of capital requirements and goes to reduce, or increase as in the case of weighting of 1250%, the amount of the institution's exposure to the financial activity in question; the total of the weighted exposure value whose weighting factors are determined using the IRB method based on internal ratings or standardized method, adopted by Regulation 575/2013/EU is used for the calculation of the capital requirements defined by Article 92 of the same regulation as will be illustrated below.

With reference to paragraph 3 letter a of Article 89, the rule in Article 90 establishes an alternative to the risk weighting of 1250% which allows institutions to deduct amounts exceeding the limits specified in paragraphs 1 and 2 of Article 89 , from the elements of primary capital of class 1 pursuant to Article 36 (1) (k). Article 91 defines the shares in companies that can be excluded from the calculation of the eligible capital, in particular in paragraph 1 establishes that the shares in enterprises not referred to in Article 89 (1) (a) and (b) are not included in the calculation of the limits of the eligible capital referred to in that article if one of the following conditions is met: (a) such shares are held on a temporary basis in the course of a financial assistance operation, in accordance with Article 79; b) the holding of such units constitutes a position in irrevocable commitments held for five working days or less; c) such shares are held in the name of the entity and on behalf of others. In paragraph 2, it is established that the quotas not classified as

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financial fixed assets referred to in Article 35 (2) of Directive 86/635/EEC shall not be included in the calculation referred to in Article 89 ( the term "financial fixed assets" means, in the case of credit institutions, investments in associated companies and securities intended to serve the company's business in a lasting manner).

In Title I, Chapter 1 and Articles 92 to Article 106 of interest for this publication, the Commission issues provisions on generic capital requirements, in particular it defines in paragraph 1 of Article 92 and subject them to Articles 92 and 93, own funds requirements: institutions always meet the following own funds requirements: a) a class 1 primary capital ratio of 4.5%; b) a class 1 capital ratio of 6%; c) a total capital ratio of 8%.

In paragraph 2 it establishes that institutions calculate their capital ratios as follows: a) the class 1 primary capital ratio is the institution's class 1 primary capital expressed as a percentage of the total risk exposure amount; b) the Tier 1 capital ratio is the institution's Tier 1 capital expressed as a percentage of the total risk exposure amount; c) the total capital ratio is the institution's own funds expressed as a percentage of the total risk exposure amount.

The article also establishes disposition for the calculation of the total amount of exposure to risk; exceptions are defined, for example the exposure relating to the assets of the credit institution's trading book can be excluded from the calculation of the total exposure when the amount of such assets does not exceed 5% of total assets on average and the amount of 15 million euros, moreover, the entity of the assets held in the trading portfolio of the institution must in no case exceed 6% of the total assets and the amount of 20 million euros. In the same title of the regulation it is established that the initial capital required in a business continuity situation and therefore in an entity's own funds can not become less than the initial capital required at the time of authorization.

For public interest entities that only provide payment services, payment institutions (of greater interest for the studies carried out in this research), the

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initial capital is defined by the EU directive 2015/2366 (amending Directive 2013/36/EU) with Article 7 and which sets 3 thresholds for initial capital: a) when the payment institution provides only the remittance services of money, its capital is never less than EUR 20 000; b) when the payment institution provides payment services payment order arrangement, its capital is never less than EUR 50 000; c) when the payment institution provides any of the following payment services listed, its capital is never less than EUR 125 000: 1. Services that allow cash to be deposited on a payment account and all the operations required for the management of a payment account.

2. Services that allow cash withdrawals from an account of pa as well as all the operations required for the management of a payment account.

3. Execution of payment transactions, including the transfer of funds, to a payment account at the user's payment service provider or to a other payment service provider: a) execution of direct debits, including one-off direct debits; b) execution of payment transactions by payment cards or similar device; c) execution of credit transfers, including standing orders.

4. Execution of payment transactions when funds are part of a credit line granted to a payment service user: a) execution of direct debits, including one-off direct debits; b) execution of payment transactions by payment cards similar device; c) execution of credit transfers, including permanent orders.

5. Issuance of payment instruments and/or agreement on payment transactions.

A payment institution may also register information services on the accounts.

Member States must take the necessary measures to prevent the multiple calculation of the items eligible for own funds when the payment institution belongs to the same group as another payment institution, credit institution, investment firm, asset management company or insurance, even when a payment institution is hybrid and performs activities other than the provision of payment services. Where the conditions for waiving individual compliance with the own funds requirements are met (requirements defined in Article 7 of Regulation (EU) No 575/2013), Member States or their competent authorities shall have the right not to apply Article 9 of this Directive for payment institutions included in the consolidated supervision of the parent credit institution in accordance with Directive 2013/36/EU (Directive determining the legal basis for access to the activities of credit institutions, investment firms and relative vigilance).

The same Directive 2015/2366/EU establishes that the own funds of the payment institutions are not lower than the higher amount between the initial

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capital indicated above (Article 7) or the amount of own funds calculated using the methods indicated below and defined Article 9 of the same directive (with the exception of those offering only money remittance services and payment arrangement services). Article 9 defines three methods for calculating own funds, method A, method B, method C, which are added to the initial capital defined in Article 7; the institute will apply one of the three methods according to the decision by the competent authorities according to the national implementing legislation of the 2015/2366/EU directive.

Method A The amount of the own funds of the payment institutions is at least 10% of the general fixed costs of the previous year. The competent authorities have the right to adapt this obligation in case of a substantial change in the activity of a payment institution compared to the previous year. When, at the date of calculation, the previous period of activity of the payment institution is less than one full year, this coverage is equal to 10% of the corresponding general fixed costs of the prevailing business plan, subject to any adjustment prescribed by the competent authorities.

Method B The amount of the own funds of the payment institutions is at least equal to the sum of the following elements multiplied by a ticking factor k, defined below, where the volume of payments (PV) represents one-twelfth of the total amount of payment transactions executed by the payment institution in the previous year: a) 4.0% of the share of PV up to EUR 5 million plus b) 2, 5% of PV share above EUR 5 million and up to EUR 10 million plus c) 1% of PV share above EUR 10 million up to EUR 100 million, plus d) 0.5% of the share of PV above EUR 100 million and up to EUR 250 million plus e) 0.25% of the share of PV above EUR 250 million of EUR. Method C The amount of the own funds of the payment institutions shall be at least the product of the relevant indicator referred to in point (a) for the multiplication factor referred to in point b), then multiplied by the graduation factor k defined below. a) The relevant indicator is the sum of the following elements: i) interest income; ii) interest expenses; iii) income for commissions and rake-off; and iv)

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other operating income. Each element is included in the sum with its own positive or negative sign. Income from extraordinary or irregular items is not used in the calculation of the relevant indicator. Expenditure related to the outsourcing of services rendered by third parties may reduce the relevant indicator if it is borne by a supervised company in accordance with this Directive. The relevant indicator is calculated based on the observation on an annual basis carried out at the end of the previous year. The relevant indicator is calculated on the previous year. However, the own funds calculated on the basis of the C method are not less than 80% of the average value of the relevant indicator for the three previous years. If audited data are not available, company estimates may be used. b) The multiplication factor shall be: i) 10% of the share of the relevant indicator up to EUR 2,5 million; (ii) 8% of the share of the relevant indicator from EUR 2,5 million to 5 million; (iii) 6% of the share of the relevant indicator between EUR 5 million and EUR 25 million; iv) 3% of the share of the relevant indicator from EUR 25 million to 50 million; v) 1.5% above EUR 50 million.

K FACTOR 2. The graduation factor k to be used in methods B and C is equal: a) to 0.5 when the payment institution lends only payment services remittance of money; b) to 1 when the payment institution provides one or more payment services in addition to money remittance services, payment order arrangement services, account information services.

The competent authorities, based on an assessment of the risk management processes, the loss prevention database and the internal control mechanisms of the payment institution, may require the payment institution to hold up to 20% higher own funds. with respect to the amount that would result from the application of the chosen method A, B or C, or allowing the payment institution to hold lower own funds up to 20% compared to the amount that would result from the application of the chosen method.

Directive 2015/2366/EU establishes provisions for protection requirements (Article 10), in particular Member States or competent authorities require payment institutions that provide payment services to protect all funds received from users of payment services or through another payment service provider for the execution of payment transactions, according to one of the following methods: a) the funds are never confused with the funds of a any natural or legal

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person other than payment service users on whose behalf the funds are held and, if they are held by the payment institution and not yet delivered to the payee or transferred to another payment service provider within the first day subsequent to the day on which the funds have been received, are deposited in a separate account of a credit institution or invested in safe, liquid and lowrisk assets as defined ite by the competent authorities of the home Member State; and are isolated in accordance with national law in the interest of payment service users from payment claims from other payment institution creditors, particularly in the event of insolvency; b) the funds are covered by an insurance policy or some other comparable guarantee, obtained from an insurance undertaking or a credit institution not belonging to the same group to which the payment institution belongs, for an amount equivalent to that which would have been segregated without of the insurance policy or other comparable guarantee, payable if the payment institution is not able to fulfill its financial obligations.

The payment institution also protects the percentages of funds that will be used for future payment transactions ( for example, the remaining amount is to be used for services other than payment services). If this percentage is variable or unknown in advance, Member States shall allow payment institutions to protect a representative percentage that is presumed to be used for payment services, provided that such representative percentage can reasonably be estimated on the basis of historical data and deemed appropriate by the competent authorities.

4 - RISKS FOR CREDIT INSTITUTIONS The provisions of Regulation 575/2013/EU respect the principle of proportionality with particular regard to the diversity of entities in terms of size and scope of operations and range of activities. Compliance with the proportionality principle also implies, rating procedures recognized for retail exposures, are as simple as possible such as the standard method or the internal rating method ("IRB approach"). Member States should ensure that the requirements defined in this Regulation are proportionate to the type, scale and complexity of the risks associated with the business model and the activities of the institution. The European Commission should ensure that the delegated acts and implementing acts, regulatory technical standards and implementing technical standards are consistent with the principle of

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proportionality so as to ensure that this regulation is applied proportionally to the diversification of institutions and the range of their activities. EBA should therefore ensure that all regulatory and implementing technical standards are formulated in such a way as to respect and be consistent with the principle of proportionality.

4.1 – Introduction Financial risk affects company liquidity, an important variable for the balance between incoming and outgoing monetary flows, in fact it is also definable as the indefinite (or volatile) variability of investments, including potential losses and unexpected gains. The risk is always present in the market, and based on its perception on the part of the investors the relative trust in the investment is determined. Savers perceive the risk when it manifests itself in the form of loss. Closely related to the perception and assessment of financial risk is the expected return from the investment: the higher the risk, the more the investor requires a return, return or premium for the high risk. Financial risk takes on different dimensions, at different levels. The main distinction is between generic risk and specific risk, valid for all types of investments.

There are other differences typical of the various asset classes, such as that between equity risk and bond risk. With reference to the latter, it is possible to identify the risk component associated with the issuer of the security and that linked to interest rates (market risk). Other types of risk involve investments in foreign currencies, country risk, often on the front pages of newspapers, including non-financial ones. As we see in the following paragraphs at this, institutions also have other risks to consider.

Generic and specific: the global economic situation, the ups and downs of stock exchanges and the inefficiencies that characterize the financial system in its complex feed the so-called generic risk, also called systematic because in fact can not be eliminated. It represents that part of the variability of the value of investments that depends on the fluctuations of the markets, which have an impact on any title regardless of its quality. For example, if the stock market is falling, it is very likely that such a scenario will also impact on the performance of my stock. On the contrary, we speak of a specific risk when the "dangers" derive from the peculiar characteristics of the single security and therefore of the issuer. If the latter were in difficulty, we could run into a failure to distribute dividends or reduce the value of the investment, for example linked to a massive sale on the stock market by shareholders. If the generic risk is not avoidable, it is possible to counteract the effects of the

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specific risk by resorting to so-called diversification. This reduces the exposure, and therefore the link, to the performance of the individual stock, counterbalancing it with that of other investments in the portfolio.

Shares and bonds. An action, in the finance, is a representative title of a share of the ownership of a public limited company. The owner is called a shareholder (in English, the shareholder), while all the shares of the company are called share capital; for the owners of the same there is no guarantee of remuneration of the amount originally invested. The subjects (even legal) investing in shares are aware that, when they decide to resell them, the price may be higher but lower than the initial one, causing an investment return or a loss. The value of the action depends on many factors such as the performance of the market in general and the sector to which it belongs (generic risk), variables linked to the issuer (specific risk): ability to generate profits and cash flows, dividends distributed to shareholders, capital strength, competitiveness with respect to competitors, increase in the market shares of the related company production activities, quality of management. All elements that are difficult to evaluate even for those in the industry. For these reasons, it may help to invest in the stock market through instruments able to diversify the risk on dozens (if not hundreds) of securities, domestic and international.

Bonds. Investment in securities bonds are considered more secure than equities, does not mean that it is totally risk free. Who buys a fixed income security knows the rate of return (the exact amount of the coupon in the case of a fixed rate and the parameter with which the coupon will be determined in the event of a floating rate) and the expiry date in which it will get back the nominal value of the invested capital. It can not be ruled out that over time the issuer (State or company) may have difficulties that prevent the payment of interest. More serious events are that the issuer could incur bankruptcy and, on expiry, do not honor the return of capital. The events related to Argentina in 2001, to Cirio and Parmalat securities, to the issues of the American investment bank Lehman Brothers or to the government bonds of Greece show that it is not just a matter of theory. To reduce the risks above, investment funds can be used which reduce the negative impact in the short term and compensate them over the medium term. For example, whoever invested his assets on July 18, 2008 in Lehman Brothers bonds (that is, a few weeks before his bankruptcy), three years later would have found himself practically without anything (or, at best, with a possible repayment of 15-20 euros per 100 nominal, realizing a loss between 80% and 85%). If, on the other hand, he had bet on a fund invested in Investment Grade corporate bonds, he would have benefited from a net average gain of 9.9% after three

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years. A mutual fund is a financial instrument comparable to a large piggy bank where the resources of small and large savers converge. The management of the "piggy bank" is entrusted to an investment management company that offers the advantage of a professional investment service to all savers who otherwise, having a small capital available or lacking the necessary skills, could not afford it. The manager of a fund invests in various types of assets such as cash, bonds, shares and real estate. The decision on what to buy depends on the investment objective of the fund. Diversify your investment portfolio by cushioning negative events such as the risks above.

Source: processing on the Banca Fideuram Fondi Index. Corporate Investment Grade bonds in euros.

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Issuer: The issuers of securities and equities do not all have the same reliability, which is reflected in the quality of their bonds. The issuer risk of an obligation is linked to the issuer's ability to pay interest and repay its debt.

When the subject (state, bank, company, etc.) that issued the bond is not in a position to liquidate the interest and / or to repay the capital, the debtor is considered insolvent. There are independent specialized agencies, among the most famous Moody's and Standard & Poor's (S&P), which help to evaluate the quality of bonds. Attributing the so-called ratings, they estimate the creditworthiness of an issuer, that is, its ability to honor debts contracted in the promised times and ways. Below, in descending order by quality, the main classifications used.

Interest rate. There are two general aspects to be considered for bond investments: 1) the value of the obligation a variable rate tends to vary little over time.

2) the value of the Fixed rate bonds vary in the opposite direction to the trend in interest rates, if the latter rise, the bond price falls and vice versa.

Very often, to assess the risk of bonds and bond funds and to facilitate comparisons , the concept of duration is used which represents the financial duration of a security (or, if it is a fund, the sum of all securities in the portfolio), ie its residual life weighted with the coupon flow that will pay in the future . Expressed in years or days, duration is a measure of bond risk. As the value increases, the volatility of the stock increases and therefore the risk of fluctuating its price over time as interest rates change; for floating rate bonds, it assumes a low value. As a result, their volatility is reduced even in the presence of moderate rate fluctuations. The fixed rate bonds, whose coupon remains identical regardless of the trend in rates, have a longer duration compared to government securities or floating rate bonds; they therefore have greater volatility and a more marked reaction in the event of changes in interest rates in the sale price of the security. The duration of a bond portfolio (as in the case of an investment fund) is equal to the weighted average duration of the individual securities that comprise it. Through the duration indicator it is possible to obtain a measure of the volatility of the reference stock. This is a value that is regularly reported in the tables of bonds issued in financial newspapers and on specialized websites. Let us assume that we own one thousand bonds worth each euro 108 (the total value is therefore equal to 108,000 euro), with a volatility of 5.5%; in the event of a 1% change in interest rates, applying the simplified formula (value of the security before the increase in interest rates x percentage rate increase x volatility) we obtain 5.94% (108 x 0.01 x 0.055 = 0.594 = 5.94%). It means

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that, if interest rates increase by 1%, the price of the bond in my possession (which moves in the opposite direction to the market rates) will go down 5.94% (in our case would result in a loss of about 6,415 euro), and vice versa if the rates decreased by one percentage point. This estimate is approximate, but can be considered a reliable indicator to assess the possible impact of changes in interest rates on the securities (or the fund) in its possession.

Currency Exchange. There are many instruments on the market in currencies of other countries, developed nations (US dollar, British pound sterling, etc.) and developing countries (Brazilian real, Mexican peso, etc.). In addition to the risks mentioned at the superior points linked to securities, the currency exchange risk that is potentially decisive for the final result of the investment in securities must be considered, which can generate an appreciation but also a depreciation of the investment. In fact, when you buy a stock from another country, eg in a currency other than the euro, you must make a euro currency exchange in the currency of the country where you is issued the security (in the case of an obligation also coupons). If the currency of the country where the security was issued has been re-evaluated on the single European currency, it will add performance to the investment and vice versa if it has lost value. Although in the medium to long term, currency rates tend to reflect the real strength of the economy of the country to which they refer, in the short term the dynamics of the financial markets are such that it is difficult to foresee the evolution of the exchange currency. The DIY investment in foreign currency securities is therefore far from easy. The use of investment funds also in this case can be effective thanks to the possibility of diversifying the currency risk, with costs that are more contained than those incurred for an administered deposit. The administrative deposit is a banking instrument made available by the intermediary to buy shares, also via the web and to carry out other transactions linked to the life of the securities purchased on the stock exchanges, the most important being the New York Stock Exchange. The bank will manage the securities for you by collecting dividends, coupons and repayment of principal upon maturity.

Source: processing of Banca Fideuram, JPMorgan and Sole 24 Ore data; period 19/07/2010 - 19/07/2011.

4-2 Risk classification In the upper sections of this paragraph we have placed interest in a generic risk analysis from the consumer's point of view; below we will pay attention to the risks to which a credit institution is exposed, classifying them in application of Regulation 575/2013/EU.

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1) credit risk (includes counterparty risk, ie the risk that the counterparty of an operation will is in default before the definitive settlement of the financial flows of an operation); the credit risk together with market risk and operational risk became very topical following the Basel agreements, international agreements between the governors of the central banks of the ten most developed countries in the world, the so-called G10. The credit risk of customers, according to these agreements, must be calculated by the banks to guarantee the stability and solidity of the banking system. The credit risk (or risk of insolvency) is the risk that in the context of a credit operation the debtor does not even partially fulfill his obligations to repay the capital and/or to pay interest to his creditor. The New Basel Accord (Basel II) provides guidelines on which credit institutions must comply. First, Basel II defines that the credit risk includes the following variables: the risk of default, measured by the probability of default (PD), refers to the risk of a certain client of the financial institution; the probability of default of a counterparty over the time horizon of a year.

Exposure at the time of default (Exposure At Default, EAD): the value of risk assets on and off financial statements (guarantees issued and commitments), represents the sum of the values of all exposures to the debtor. For the latter, a specific credit conversion factor (Credit Conversion Factor,CCF) the ratio between the currently unused portion of a credit line that could be used, and which would then result in an exposure in the event of default, and the currently unused portion of the credit line, where the size of the credit line credit is determined by the pre-established limit, unless the non-preestablished limit is higher.

The risk of recovery, measured by the Loss Given Default (LGD), refers to the severity of the loss in case of default, is the ratio between the loss suffered on an exposure due the default of a counterparty and the amount remaining at the time of default or the expected value of the ratio between the loss relating to the default and the amount of exposure at the time of default, EAD; for the loss, the recovered flows and the direct and indirect costs connected to the recovery of the receivables are taken into account, which must be discounted using an appropriate interest rate.LGD = F (EAD, CCF).

The effective maturity (Maturity, M): the mean, of the remaining contractual durations, for a given exposure, each weighted for the related amount.

The adjustment for the degree of fractionation of the portfolio (granularity, G): correction to be made to the total of activities risk-weighted for include the level of asset diversification in the calculation system.

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The weight of risk ( RW) is used. the "weight" of credit risk, on which the institution will have to weighting assets (risk weighting). It is function of the PD, LGD and M variables (in addition to any corrections due to the variable G), and it is calculated by assigning to each customer a risk coefficient, calculated according to one of the three following methods: standard approach (in line with Basel I (1988); the only change concerns the weighting according to the external rating (assigned by rating agencies) that goes from 20 for the best ratings up to 150 for the worst ones). RW = Y (PD, LGD, M).

Internal rating based approach or IRB (internal risk calculation approach), based on the calculation of internal ratings (assigned by a bank corporate function according to internal data and methods). Depending on the complexity of the procedures for calculating ratings, two IRB methods are distinguished: IRB foundation approach (basic IRB method, for asset classes which are included in retail exposures, for example: unsecured exposures that fall within the retail portfolio "retail" and for which a more weighted weight is applied compared to the ordinary one for unrated credit), IRB advanced approach (advanced IRB method, for asset classes, other than retail exposures, for example: Bodies) of the public sector, banks and other financial companies, non-financial corporations, short-term exposures, exposures to collective investment schemes, UCIs). In the advanced method, banks can directly use their own estimates, as well as PD, also for loss in case of default (LGD), maturity (M) or the CCF credit conversion factor; in the basic method, only the probability is default (PD).

At the end of the credit risk measurement process, we proceed to associate the weight of risk with a given rating, according to a table of correspondences: e.g. a risk of 0% corresponds to a rating of AAA, of 100% up to BBB-, of 150% under BBB- etc. The goal is determine the risk-weighted asset (risk-weighted asset), ie how much is the risk to which the bank is responsible exposed and which must be covered cautiously. Technically, the risk determines the absorption of regulatory capital (regulatory capital). For the purposes of assessing the creditworthiness of a company, a considerable quantity is evaluated of information about: financial statements, company organization, budget and business plan, trespassing in current accounts, outstanding payments, delays in payment of installments, etc.

2) Market risk, in finance, is the probability of obtaining a return different from the expected one from trading in financial instruments. In particular, it represents the potential loss or gain of a position or a portfolio of securities, over a specific time horizon, following changes in market variables, based on which are distinguished:

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Interest rate risk - the risk of loss deriving from adverse movements in the interest rate; Exchange rate risk - the risk of loss deriving from adverse movements in the exchange rate of foreign currencies; Share risk - the risk of loss deriving from from adverse movements on stocks and / or stock indices; Commodity risk - the risk of loss deriving from adverse movements in the price of raw materials.

The perception of market risk that occurs when a financial crisis occurs , the uncertainty increases which in turn generates emotionality and therefore irrational behavior. Experience shows that, during the fall of market quotations, uncertainty causes an increase in the daily fluctuations in share prices. The magnitude of these fluctuations is volatility and is the most common measure of market risk.

3) Operational risk is the risk of losses deriving from processes, personnel and inadequate or insufficient internal systems, or due to external events (attacks, natural disasters, government crises that contribute to modify, at least temporarily, the prices of some listed assets). This definition of operational risk was formulated in the context of the New Basel Accord on capital requirements (Basel 2) which included a specific minimum capital ratio for this type of risk both to give banks greater incentives to develop methods for measuring and operational risk management systems, both to ensure that they have sufficient capital margins to deal with them. In fact, following the progressive deregulation and globalization of financial services (with a view to achieving a single regulation for the SEA European economic area), associated with the development of financial technology, the need emerged for banks to protect themselves not only against typical risks such as credit risk, interest rate and market risk but also other types that do not fall under these definitions. Some examples of operational risk are attributable to human resources such as the risk of manual errors in data processing, negligence, inefficient maintenance of internal controls and backup systems, abuse of confidential information, undue transactions carried out on behalf of the bank, recycling of money of illicit origin. Another primary source of risk concerns the use of information systems whose increasing dependence on banking makes them particularly vulnerable to problems such as programming errors, interruptions and malfunctions of information systems, loss and mismanagement of data and procedures. back-ups, failures and

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intrusions of external systems. Historically, banks have always faced these risks by adopting control mechanisms within them. Subsequently, with the evolution of the banking system, methods specifically aimed at managing operational risk were developed, similar to the approach used for credit and market risks. The methodological approaches proposed to calculate this requirement are: the Basic Indicator Approach: the capital requirement for operational risk is determined by the product between the brokerage margin (6°), item 120 of the IAS financial statements, and an alpha coefficient of 15%.

The Traditional Standardized Approach: the capital requirement is determined by multiplying the intermediation margin divided by business line for the respective beta coefficient differentiated according to the specific business line. The Basel Committee has identified 8 business lines that collect the intermediation margin of financial intermediaries according to the technical form of the associated products and / or the market segment they are addressed to. (Financial services for the company 18%, Negotiation and sales 18%, retail brokerage 12%, commercial banking services 15%, retail banking services 12%, payments and regulations 18%, trust management 15%, asset management 12%).

The Advanced Measurement Approach: determines the capital requirement based on internal models. One of these is the Loss Distribution Approach which determines the Operational VaR on the basis of the impact and frequency distributions of each operational risk identified. The use of one of these three approaches is authorized by the supervisory authority on terms that financial institutions are working to implement systems of governance of this type of risk gradually more complex and structured. The use of advanced approaches will therefore allow banks to obtain a lower capital requirement against a more effective risk governance system.

(6°) NOTE: in economics, an intermediary (also known by the English term broker) is a person (physicist) or a group of people (business agency, agency representative ) that organizes transactions between a buyer and a seller, earning a commission when the deal is concluded. Classically it is distinguished between the intermediary and the mediator, meaning that the former acts in representation of the interests of one or more of the parties, but not all, while the second, whose role is mediating, is impartial representative of all the parties. If an intermediary can have significant relations with the parties he represents, the mediator, on the other hand, could not have it, at risk and otherwise he will fall in the conflict of interests. Also the contracts

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with which the interposition is legitimate are distinguished in most of the legal systems in which they are typified: the intermediary operates in terms generally attributable to mandate relationships, while the mediator receives the task of mediation. Both figures are legally classified as auxiliaries of commerce.

4) Concentration risk: risk arising from exposures to counterparties, including central counterparties, groups of related counterparties and counterparties operating in the same economic sector, in the same geographic region or carrying out the same activity or dealing with the same goods, as well as the application of credit risk mitigation techniques, including, in particular, the risks deriving from indirect exposures, such as, for example, against single suppliers of guarantees; 5) risk country: risk of losses caused by events occurring in a country other than from the country of orignine of the institution. The concept of country risk is wider than that of sovereign risk as it refers to all exposures regardless of the nature of counterparties, be they natural persons, companies, banks or public administrations; 6) risk of transfer: risk that an intermediary, exposed to a person who finances in a currency other than that in which he / she perceives his / her principal sources of income, realizes losses due to difficulties of the debtor to convert his / her currency in the currency in which the exposure is denominated; 7) basic risk: in the context of market risk, the basic risk represents the risk of losses caused by non-aligned changes in the values of positions of sign opposite, similar but not identical. For example, the "risky" countries are divided into six risk classes, with weighting percentages of 15, 20, 25, 30, 40 and 60 percent respectively of the nominal value of the loans; 8) interest rate risk deriving from assets other than trading: risk deriving from potential changes in interest rates. Intermediaries must be provided with effective rules, processes and instruments for managing interest rate risk deriving from assets other than those allocated to the trading portfolio. The exposure to interest rate risk is measured with reference to the assets and liabilities of the units of the entity operating in Italy and abroad, included in the banking book; 9) liquidity risk: the risk of not being able to meet its payment obligations due to incapacity is to raise funds on the market (funding liquidity risk) and to dispose of its assets (market liquidity risk);

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10) residual risk: the risk that the techniques recognized for the mitigation of credit risk used by the intermediary are less effective than expected; 11) risks deriving from securitisations: risk that the economic substance of the securitization transaction is not fully reflected in risk assessment and management decisions; 12) risk of excessive leverage: the risk that a particularly high level of indebtedness with respect to the endowment of own resources will make the intermediary vulnerable, making it necessary to take corrective measures to its own business plan, including the sale of assets with the recognition of losses that could entail value adjustments also on the remaining assets; 13) strategic risk: the current or prospective risk of a fall in profits or capital deriving from changes in the operating context or wrong business decisions, inadequate implementation of decisions, lack of responsiveness to changes in the competitive environment; 14) reputation risk: the current or prospective risk of a decline in profits o the capital deriving from a negative perception of the intermediary's image by customers, counterparties, intermediary shareholders, investors or supervisory authorities.

In the investment activities of an institution, in the relevant investment portfolio, for each line the types of risks and the related exposure amount are identified, multiplied by the sum of the weightings, calculated using the standard or IRB basic and advanced internal method; determine the total value of the exposure of the weighted investment line. The sum of the weighted exposure values for all the institution's investment lines is necessary for the determination of the capital requirement. The total value of the weighted exposure obtained, (relative to the entire portfolio of the institution), is compared to own funds, a ratio that can not be less than 8%; it must also be compared to the primary capital of class 1 with the condition that it must not be less than 4.5% and finally must be compared to the capital of class 1 which must not be less than 6% as seen in the previous paragraph of this publication. Regulation 575/2013/EU defines the provisions for identifying the risks of an investment and for calculating the relative weighting.

4-3 Prudential supervision

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The main objectives of Regulation 575/2013 and Directive 2013/36/EC can be summarized in the following three points: 1) the effective pursuit of objectives of prudential regulation, for an accurate measurement of the risks of financial intermediaries and a capital endowment strictly proportional to the effective degree of risk exposure of each intermediary. Encourage the improvement of management systems and risk measurement techniques; enhance the disciplinary role of the market, through specific disclosure obligations to the public.

2) The amendments made by Directive 2013/36/EC and Regulation (EU) no.

575/2013 to the legislative framework on prudential supervision provide for the extension of banking regulation to financial intermediaries, contributes to strengthening the sound and prudent management of intermediaries and the stability of the financial sector as a whole; moreover, the Community legislation allows the prudential treatment envisaged for exposures to banks and investment firms to be applied to exposures to financial intermediaries that: a) are authorized to operate and are supervised by the same Supervisory Authority which authorizes the banks; b) are subject to prudential requirements comparable for robustness to those applied to banks and investment firms; 3) The implementation of the principle of proportionality through a system of modular rules, taking into account the peculiarities of intermediaries in terms of operational, dimensional and organizational complexity as well as of activities carried out. To this end, different rules are envisaged in some areas operating and the is incentivized, more generally, application of the provisions consistent with the specific characteristics of each intermediary. In fact, the regulations introduce rules that differ for some profiles from those envisaged for banks in order to take into account the typical characteristics of financial intermediaries.

Prudential regulation is based on "three pillars" provided for by the Basel regulations and by European regulations. In particular, the former introduces a capital requirement to address the typical risks of financial activities (credit, counterparty, market and operational); to this end, alternative methods for calculating capital requirements with different levels of complexity are envisaged; in risk measurement and organizational and control requirements.

The second pillar requires intermediaries to adopt a strategy and a process to check capital adequacy, both current and future, remitting to the Supervisory Authority the task of verifying the reliability and consistency of the related results and adopting, where the situation requires it, the appropriate

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corrective measures. The third pillar introduces public disclosure requirements regarding capital adequacy, exposure to risks and the general characteristics of the related management and control systems. The scope of the regulation also provides for consolidated rules; in this case, some prudential institutions are applied only at consolidated level and not even at the level of individual members of the group. Own funds represent the first garrison for the risks associated with the activity of financial intermediaries and the main benchmark for prudential institutions and for the assessments of the Supervisory Authority. The discipline dictates how to determine own funds, the criteria and the limits for the calculation of the items that compose them, as seen in the previous paragraph. For credit risk, different methods for calculating the requirement are provided: the Standardized method, the internal rating method (Internal Rating Based, IRB), which in turn is subdivided into a basic IRB and an advanced IRB. The use of IRB methodologies for calculating the requirement is subject to the authorization of the supervisory authority. As seen above under Regulation 575/2013/EU under both methods, it provides a "support factor" that allows intermediaries to reduce the weight of capital requirements for exposures to small and medium-sized enterprises (SMEs), to purpose of favoring the inflow of credit to this category of subjects, given their fundamental role in creating economic growth and guaranteeing employment in the single market. In the same regulation specific rules are laid down for credit risk mitigation techniques (Credit Risk Mitigation, CRM) and for securitization transactions. The CRM identifies the eligibility requirements - legal, economic and organizational and the methods for calculating risk reduction. With regard to the "traditional" and "synthetic" securitization transactions, the effects for the assignors are regulated, above all in terms of the exclusion of the securitized assets from the calculation of the requisites, and the prudential treatment for the intermediary purchasers. The counterparty risk relates to the risk that the counterparty of a transaction involving financial instruments is in default before the settlement of the same and can be considered a particular type of credit risk, the counterparty risk standard focuses on the rules for quantification the value of exposures, and refers to that of credit risk for the indication of weighting factors. Within the counterparty risk on the banking book, a requirement is envisaged to monitor the risk of negative changes in the creditworthiness of counterparties, other than central counterparties, of OTC financial derivative instruments and, where relevant, SFT transactions (STF means in a broad sense any type of transaction where the securities are used to lend money and vice versa. By way of example, repurchase agreements, securities lending, and sell / buy back transactions are included.

In each of these, the ownership of the securities changes temporarily, in

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exchange for cash, and then reversed again at the end of the operation.).

With reference to market risks, the requirement is aimed at dealing with losses that may arise from operations on the markets relating to financial instruments, currencies and commodities. They can be determined according to a standard methodology or based on internal models, subject to compliance with organizational and quantitative requirements and with the approval of the supervisory authority. Regulation 575/2013/EU identifies and determines the treatment of the various types of risk with reference to the trading portfolio for regulatory purposes (position and concentration risks) and to the entire financial statements of the intermediary (exchange rate risk, settlement risk and position in commodities). The standardized methodology adopts a building block approach for the calculation of the requirement (following paragraph); internal models are based on a daily control of risk exposure, calculated through an approach based on statistical procedures ("value at risk" approach), to be integrated with other forms of risk measurement and control. Regulation 575/2013/EU provides a specific capital requirement for operational risk with the aim of increasing the management controls and control over the intermediaries. There are different methods for determining the requirement: the Basic method (Basic Indicator Approach, BIA), in which the requirement is calculated by applying a single regulatory coefficient to the indicator of the company's operating volume, identified in the intermediation margin; the standardized method, subject to authorization by the Supervisory Authority, which provides for different coefficients for the various business lines in which the business activity is divided; Advanced methods (Advanced Measurement Approach, AMA), also subject to authorization by the Supervisory Authority, in which the amount of the requirement is determined through internal models, based on operational loss data and other evaluation elements collected and processed intermediary. The overall capital requirement is determined as the sum of the requirements related to the individual types of risk (building block). The provisions on risk concentration respond to the need to limit the risks of instability of intermediaries involved in the granting of loans of a significant amount compared to the eligible capital. Consistent with the community regulations, limits are set with reference to the extent of the risks that can be assumed towards the client or the group of connected customers. The regulation of the "second pillar" requires financial intermediaries to acquire processes and instruments (Internal Capital Adequacy Assessment Process, ICAAP) to determine the level of internal capital adequate to deal with any type of risk, even if different from those covered by the overall capital requirement ("first pillar"), in the context of an exposure assessment, current and future, that takes into account the strategies and the evolution of the

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reference context. The discipline identifies the phases of the process, the periodicity, the main risks to be evaluated, providing for some of them indications on the methodologies to be used. The responsibility of the ICAAP process is placed on the corporate bodies. The intermediaries report to the supervisory authority on an annual basis the fundamental characteristics of the process, the exposure to risks and the determination of the capital deemed appropriate to deal with them through a structured report. The latter also contains an ICAAP self-assessment that identifies areas for improvement, any shortcomings in the process and the corrective actions that are expected to be implemented.

The SREP (Supervisory Review and Evaluation Process) is instead the process by which the Supervisory Authority, after having analyzed the overall situation of the intermediary, proceeds to formulate an overall opinion on the intermediary and to activate, where necessary, the appropriate corrective measures. This process takes place, as a rule, through the comparison with intermediaries and the use of the system of analysis and assessment of supervised entities adopted by the Supervisory Authority. The comparison between Supervision and intermediaries allows the former to gain even more in-depth knowledge of the ICAAP process and the methodological assumptions underlying it, to intermediaries to illustrate the motivations to support their valuations in terms of capital adequacy. The Supervisory Authority, if necessary, adopts the appropriate corrective measures, of an organizational and patrimonial nature, identifying among the various instruments available the most appropriate in relation to the specific case. In the context of prudential regulation (Article 1, letter e of Regulation 575/2013/EU) specific public disclosure obligations ("third pillar") are set up to facilitate a more accurate assessment of capital strength and risk exposure intermediaries. Regulation 575/2013/EU establishes quantitative and qualitative information that intermediaries must publish. Based on the proportionality principle, intermediaries commensurate the details of the information to their organizational complexity and to the type of operations performed. The regulation identifies the frequency of publication, the relative exceptions, as well as the checks to be carried out on the information to be made to the public.

Source: Maragoni Mario, Bank of Italy supervisor, Bank of Italy Circular 288 3 April 2015 (https://www.bancaditalia.it).

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5 - RISK FOUNDATION We will refer to the weighting that a credit institution calculates in the case of granting a credit (financing), of greater interest for the research carried out in this publication. Credit granting by credit institutions is based on customer assessment, quality assurance and credit risk; in particular, the credit institution calculates the risk weighting factor to which it is exposed by granting the credit to the customer to define the regulatory capital. With the first agreement signed in Basel in 1988, a capital ratio of 8% is defined, to be calculated on the value of the loan disbursed. The regulatory evolution with the new Basel 2 agreement led to the transformation of the calculation of the Supervisory Capital: even if the percentage to be set aside remained unchanged at 8%, a closer correlation between assets and risks was introduced. The risk assessment methods have changed significantly, now more sophisticated and objective. Already in the previous agreement there was a sort of weighting of the operations, but they were completely standardized and in exclusive function of the type of subject requesting the credit; with the second agreement, an evaluation based on creditworthiness is introduced. With the new agreement, on the other hand, total loans, which must be taken as a basis for calculation, are obtained by multiplying each loan in advance by a weighting factor that takes into account the risk characteristics of the specific transaction. The total capital ratio of 8% is therefore applied to total weighted investments. Compliance with the capital ratios defined in Article 92 of Regulation 575/2013/EU is based on the application of the following formula: CAPITAL COEFFICIENT = regulatory capital to be set aside / weighted commitments = 8% The European Commission with the supervisory provisions defined in Regulation 575/2013/EU considers that not all credit institutions will be able to promptly change their IT systems in the short term, thus providing for different evaluation systems, more or less advanced , depending on the needs of the institution: a standard method and an IRB method, in turn distinguished in base and advanced. The regulation provides that the transfer of an institution from the application of the standard method to the IRB method must be authorized by the supervisory authority. The weighting factors on which the rating systems are based are Rating: it is the judgment on creditworthiness (quality/risk) and expresses the assessment of the reliability of the financed subject on the basis of quantitative, qualitative and performance information (indebtedness of a

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subject towards credit institutions). The subject will be assigned a specific rating class, which is automatically associated with a specific PD (probability of default); Probability of default (PD = Probability of default): is the probability that the financed subject is in default (default) over the next 12 months.

Loss in the event of default (LGD = Loss given default): the presumed loss percentage in the event of default, compared to the total credit granted net of any recoveries; Exposure in the event of default (EAD = exposure at default): is the probable quote of exposure at the time of insolvency; Expiry (M = Maturity): this is the residual duration of the loan.

The weighting factors for a single loan to the company may be used for the purpose of calculating capital requirements for a fraction or for a multiple of the financing itself.

This means that, for the same amount of capital invested (ie credit granted), an institution (bank) may find itself in a position to allocate higher quotas to regulatory capital than the exposure, in the case of high risk (the weighted use for the multiplier will higher than the same employment value), or lower than the exposure, in the case of low risk (the weighted use for the multiplier will be lower than the same employment value). Higher regulatory capital implies lower resources for the bank to be dedicated to loans and, consequently, a reduction in bank profitability and, at the same time, a worsening of the conditions for access to credit for businesses (pricing). With reference to the regulatory capital requirements defined by Article 92 of Regulation 575/2013/EU, the weighted exposure amount (the amount of credit granted multiplied by the weighting factor) binds regulatory capital, capital of the entity obtained from the sum of the capital of class 1 and class 2, for an amount equal to 8% of the exposure, binds the primary capital of class 1 for an amount of 4.5% of the exposure, binds the capital of class 1 for an amount of 6% of the capital of class 1.

SISTEMA STANDARD (S.R.B. STANDARD RATE BASE APPROACH). Il sistema standard prevede che i fattori di ponderazione del rischio siano tutti formulati da soggetti esterni all'istituto di credito. Il rating viene valutato da agenzie indipendenti accreditate, dette ECAI (7°) ("External Credit Assessement Institution"), mentre PD, LGD, EAD e M sono fissati dall'Autorità di Vigilanza sulla base della categoria giuridica economica di appartenenza dell'impresa richiedente il finanziamento, delle sue dimensioni

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aziendali, delle caratteristiche tecniche della operazione di finanziamento, ecc. Gli enti creditizi che adottano questo sistema segmentano i loro crediti in categorie prudenziali e ad ognuna corrisponde una ponderazione del rischio fissa. A tal proposito si illustra lo schema predisposto dalle due maggiori agenzie esterne, Standard e Poor's e Moody's, nel quale sono riportate le categorie di rischio che vanno da AAA per le imprese meno rischiose a BB/B3 per quelle che presentano un'elevata rischiositĂ .

NOTE (7°): External Credit Assessment Agencies, "External Credit Assessment Institution (ECAI)", have been established with the new Capital Agreement defined by the Basel Committee for Banking Supervision ("Basel 2"). These are specialized institutions in possession of certain requirements such as credibility and independence, as well as objectivity and transparency in the assessment of the creditworthiness of the customers of those financial institutions that have not yet implemented an internal rating system (IRB) but who have adopted the method Standardized for the calculation of the capital requirement. Banks can avail themselves of the valuation of an ECAI also in the context of the IRB method, but only limited to positions with securitizations. On 18 January 2006 the Committee of European Banking Supervisors (CEBS) approved the guidelines for the recognition of ECAIs and subsequently the supervisory authorities of the Member States issued provisions for the recognition of the agencies. In particular, this recognition and mapping (reconciliation of ratings to weighting coefficients) is the responsibility of the supervisory authority. This information, an updated list of recognized ECAIs and their mapping, can be found on the official website of the supervisory authorities; (for Italy, the Bank of Italy website). Article 135 of Regulation 575/2013/EU establishes in paragraph 1 that in order to determine the risk weight of an exposure necessary for the calculation of regulatory capital, an external credit assessment can only be used if it is been issued by an ECAI or if it has been endorsed by an ECAI pursuant to Regulation (EC) No 1060/2009. In paragraph 2, the EBA shall publish on its website the list of ECAIs in accordance with Article 2 (4) and Article 18 (3) of Regulation (EC) No 1060/2009.

The following figure shows the pre-established weighting coefficients related to the rating assigned to companies by external companies:

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Article 122 of Regulation 575/2013/EU determines the risk weighting factor for exposures to companies, for which a credit assessment of a selected ECAI is available. The weighting ratios for "corporate" customers are four: 20% 50% 100% 150%, based on the rating that the company requesting the loan receives from ECAI. Article 123 of the same regulation defines the conditions for exposures considered at retail level and for which a weighting factor of 75% can be applied, for example when it concerns exposures to natural persons or small or medium-sized enterprises ( SMEs) or the exposure is part of a significant number of exposures with similar characteristics, so that the risks associated with it are substantially reduced.

Schematically, the standard methodology works as follows: EXPOSURE X COEFFICIENT = FINANCIAL REQUIREMENT

FROM

EXTERNAL

RATING

X

8%

The Basel Committee has also prepared a "simplified standard method" with the objective of assistance to credit institutions and supervisory authorities; this method, which does not want to be an alternative risk assessment system, provides simplified options for the calculation of risk weighting.

Among the various innovations introduced by the new Basel agreement, acquire particular importance the risk mitigation tools that allow, in the standard method, to reduce the PD (probability of default), thus improving the rating of the customer and, consequently, the conditions of access to credit; credit risk mitigation techniques (Credit risk mitigation: CRM). They are represented by ancillary credit contracts or by other instruments and techniques that determine a reduction in credit risk, recognized when calculating capital requirements. Regulation 575/2013/EU, from article 111 to

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article 133, establishes the weighting values for all types of risks classified for debtor and relative class of merit.

Advanced "IRB" system (internal rating-based advanced). The internal rating-based advanced, is structured as a completely independent method in which the risk assessment of the client is totally carried out by the credit institution. The credit institution will have to have rather complex systems that will allow it to calculate internally all risk variables: PD, LGD, EAD and M. In order for banks to carry out the actions envisaged by this calculation system they must obtain a certification, that will be & agrave; granted by the Supervisory Authority of the country of origin. Also in the advanced IRB system a broader category of risk mitigation instruments is recognized; however, their presence allows the institution, in addition to reducing the PD, to opt for a possible reduction in LGD. Some requirements for the admission of risk mitigation instruments vary, but the company still has greater flexibility even in the context of criteria validated by the Supervisory Authority.

Source: Trade Industry Handicrafts and Agriculture of Macerata, (Gov. Italy).

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6 – APPENDIX In this appendix we will carry out a feasibility study for a capital company whose objective is to realize the investment program concerning the provision of payment services, then the start-up of the activity "Payment Institute".

6 – 1 Introduction The object of the investment program initiated by the legal entity HTN (limited liability company) is the provision of remote payment services in application of Directive 2002/65/EC for the distance marketing of financial services. In detail HTN will propose the only payment services platform defined as a web payment account to make money transfers from the payer to the payee, (credit transfers, Direct inter-bank, transfers in the SEPA area), excluding credit cards (including prepaid cards) , debit cards, disbursement of loans: in particular, with the exclusion of ancillary services, then granting loans in close relation to the payment services provided and within the limits and with the procedures established by the Supervisory Authority, provide operational or closely related services, such as the provision of guarantees for the execution of payment transactions, exchange services (only for the medium term), custody and recording and processing of data, and the management of payment systems. The provision of services will take place exclusively in electronic mode via the Internet network and there will therefore be no commercial office with the provision of financial services related to cash but only payment services relating to electronic money (it is therefore excluded the management of the coin in banknotes from activity). HTN is a consolidated company of the HTN Group, and will provide the web payment account (hereinafter indicated with the web account) exclusively to the consolidated companies of the Htn Group and its members in the medium to long term and therefore will provide a limited number of services during this period. Since the consolidated companies of the HTN Group are controlled in the majority by the same Holding, the volume of payment transactions that customers will have to carry out with the deposited funds will be known and the control procedures provided for in Directive 2015/849/EU they will be simplified.

1

L The feasibility of the business plan is identified by investments in bonds considered to be safe with the deposited funds of the corporate group to which they belong, in compliance with Directive 2015/2366/EU and Regulation 575/2013/EU. The entire staff of the IP Institute is composed of the members and administration of the Group. The web channels used are http://www.nomeIstituto.eu.

With respect to the management of the business, the business object of the investment program of the legal entity HTN, the correct proportionality is highlighted with the workforce, being the main customers of the IDP the consolidated companies and members the Group; the administration of HTN assumes the same role for the consolidated companies of the Group so the management of payment services is simplified since the payment transactions are always known to the Administration, a dynamic that simplifies the management of cash availability to cover the same transactions and simplifies the quantification of investments in bonds, the main objective of the open institute.

6 – 2 Description of the lines of development of operation The purpose and objectives of the company are identified in the provision of payment services, the web account, to consolidated of the htn group to reduce the costs and losses caused by financial services provided by third parties (delays, costs, low interest rate for deposit funds reflected on the balance sheet of the Group and shareholders) to the consolidated companies of the group. Among the objectives we exclude the interest for

2

the revenue caused by the provision of the web account, being the business development aimed at investing in bonds the funds deposited on web accounts provided from the consolidated companies. The type of customer served is corporate, the outlet market while having national potential (internet) is limited to the provision of the web account within the corporate Group. The distribution channels used for the web account are exclusively internet, from the commercial proposal to the activation and supply (more information on the methods of delivery in paragraphs 6-5 and 6-6 of the appendix).

6 – 3 Forecast report on technical profiles and capital adequacy Forecast on the performance of business volumes The forecasts on the performance of business volumes for the first three years are illustrated in the estimated financial statements for the first three years of activity annexed to the present application (which are summarized in the summary statements deriving from the forecast budgets at the end of this paragraph). They will be caused exclusively by the investments envisaged for the deposited funds of the customers (government bonds) and by the investments made with the Tier 1 capital of the Payment Institution, therefore the proceeds deriving from the provision of the account in question are excluded. (The revenues from the cost of selling the web account are negligible). The identified number of customers allows us to revise an increasing volume of activity since 2019 and caused by the cession of the VASP operator activities (AGCOM ministerial authorization)

3

Â

of the institute to the Consolidated Vas Adv which will increase its balance sheet in cash and cash equivalents from the filiation relationship with the first telecommunications operator for Italy; an increase in the volume of business is estimated for an average annual amount of about 2 million of Euro. In a long period, 10 years, an increase in the balance sheet of an amount equal to the current balance sheet of the potential HTN institute is expected. The activities of the well-established Vas Adv are scheduled for a period of around 15 years. For a summary of the volume of business, see the following paragraphs of this paragraph.

Qualitative and quantitative evolution of the loan portfolio and the related write-down forecasts, taking into account the average risk of the geographical areas/settlement markets and the customer classes served The company will not provide services related to financing transactions for customers, and the management of the loan portfolio is excluded from its activity, including the need for operational requirements in this regard and for all types of credit operations. The payment services referred to in point 4 of Annex I of Directive 2015/2366/EU are excluded from the activity program, as indicated in paragraph 6-1; with the exception of the currency exchange rate after the medium term with the relative registration to the Supervisory Board which for Italy is the OAM. The identification of the customers illustrated in paragraph 6-1 and 6-2 of the present integrated activity program (market analysis), allows to define a served customer class whose business purpose pursued has the same interest as the institution: increase the assets of the owners of the HTN Group during the years, and therefore the interests of the relative shareholders. Dynamics that allow to implement well-defined decision-making processes, exempt Â

4

Â

from risks of any kind as the business management of the same subjects in compliance with the legislation of the Member State, Italy, is controlled by the same administration of the IP (Payment Institute) as the interests, being the same majority partner administration of the consolidated companies and owner of the Group Holding Company.

The structure and development of economic needs and revenues Economic needs: the structure of the economic needs is identified in the costs of running the business, the employees of the company, Administration, members of the Group, Monocratic Control Body (cost of the internal auditor in compliance with Directive 2006/43/EC), cost of the external auditor, costs of realization and management of the own infrastructure (descriptive reports of the project in following paragraphs and paragraph 6-6), costs of outsourcing of the service provided, web account (considering the indirect tax costs of the work), consulting costs.

Further costs are identified in marketing activities for the start-up phase of the opening payment institution, which are exclusively and exclusively for the Group brand and not for the provision of services beyond the customers identified in the paragraphs above. The web shopping center will clearly indicate to consumers that the payment institution provides the financial services platform exclusively to the corporate group to which it belongs, producing an increase in good for users of the services and downloads of the same Group, indirect in terms of quality increase caused by the reduction of production costs obtained with the launch of the IDP activity. A significant economic requirement (needs) is identified in bond investment instruments (bonds through the Monte Titoli entity) with deposit funds (shareholders and consolidated) and with own funds of the same Institute. The economic investment requirements in bonds initially and for Â

5

Â

the first 3-5 years are quantified in no more than 5 million. For further details, please refer to the forecast financial statements attached to the request, instance of public authority, (which is summarized in the summary table derived from the financial statements at the end of this paragraph).

Structure costs and outsourcing services are added for the provision of the web account. The following is a summary of the economic requirements for the first three years expressed in Euro.

YEARS

Marketing - Management Structure

Outsourcing

Bonds

2019

100.000,00

250.000,00

50.000,00

4.400.000,00

2020

5.000,00

10.000,00

10.000,00

0

2021

5.000,00

1000,00

10.000,00

0

The development of economic needs obviously involves the investment in bonds that will gradually increase from the fourth year of activity up to the point of investing the entire capital of the institution and the maximum percentage of deposit funds in compliance with the supervisory provisions envisaged from paragraphs 7, 8, 9 of Directive 2015/2366/EU. There are no further cost items relating to masonry works for offices both for the type of activity (remote financial services) and because the company operates in the Internet value-added services sector (VASP operator) since 15 years and for this reason uses the current operational offices with particular reference to the current registered office.

Revenues: the revenue structure is identified in investments made in bonds, government securities considered to be less exposed to risk, given a generally higher creditworthiness of issuers. 5 million of the IP (payment institution) class 1 capital is invested in bonds over a period of three years, Â

6

Â

as regards funds for third party deposits, considering the low risk of losses due to the low legal interest rate on deposit funds, (costs for IP) even under stress conditions with an increase of 200 points, the first investments will be implemented starting from the end of the third year of IP activity because it is estimated to reach an amount appropriate to the purpose (funds to deposit of the consolidated Vas Adv) . Therefore, the revenues will have a structure composed of the interest rate that will produced by the bonds and the gains obtained in the exercise of the sale of the securities in periods when the purchase price is rising, when the sale allows a profit even at the expense of loss of a semester of the interest yielded by the bonds. The risk of a reduction in capital gains should not be ruled out, therefore a careful analysis will be carried out between the minimum nominal value of the bonds and the maximum value reached in the various periods: 1 year, 3 years, 5 years trying to carry out the purchase at the most favorable moments considering the expiration date for each bond in order to guarantee a fluctuation of the price of the securities, sufficient to increase capital gains.

For the preparation of the forecast financial statements and the summary statement of revenues below, the government bond bond BTP-1FB33 5.75% (Italian State) selected with the criteria described above for investments and the Government bond obligation is analyzed. BTP TF 3.25% ST46 EUR (Italian State). The analysis carried out with the above criteria shows feasibility for the purchase of the second security (BTP TF 3.25% ST 46 EUR) because it can be purchased, for a sufficient period of time for the transaction, at a price not much higher with respect to the issue and redemption value (nominal value) so as to show the feasibility of revenue in the change in the capital gain.

Since it is forecast it will be considered that several bonds will be followed before the purchase for the time necessary to comply with the above Â

7

criterion and chosen to maintain a rate, as the result of the investment, on average 3.25% with a withholding tax of 12, 50%. For the estimated budget an active interest rate of 3.25% and a purchase cost of the bonds will be adopted, the selling price of the last period, equal to € 105.00 and the sale of the bonds will be simulated in the third year for a sales price estimated at € 112.50 (the purchase takes place in the year 2019 by the end of April and the sale in September of the year 2021); estimates presumed by a brief analysis of the trend of the last 5 years, the trend of GDP and the similarity of variation in the price of the share with the variation in the gross domestic product. For purchases of the following years, since it is difficult to predict the minimum cost, the same cost will be considered (considering the possibility of purchasing a different security).

In the medium term, the institute will be able to diversify the securities platform by applying the differentiated fluctuation criteria: in the investment phases, take into account fluctuations with respect to the securities purchased in order to moderate them over the same time interval (have X/2 securities over the period specific are upward and X/2 securities that in the same period are down). Below is the trend of 5-year bonds, used to define the revenue structure.

Government Bond BTP-1FB33 5.75% - Italy Date of enjoyment: 01/02/2002 - redemption value 100.00 € - issue price 101.15 € - The bonds yield deferred gross annual interest, payable halfyearly on 1 February and 1 August of each year starting from 1 August 2002, equal to 5.75% of the nominal value of the loan.

8

9

The title above shows the risk of fluctuations in the sales price which causes changes in capital gains and possible losses.

Government Bond BTP TF 3.25% ST46 EUR - Italy Date of enjoyment: 01/09/2014 - redemption value 100.00 € - issue price 99.707 € - The bonds yield deferred gross annual interest, payable halfyearly on March 1 and September 1 of each year, equal to 3 , 25% of the nominal value of the loan.

10

11

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The following is a summary forecast of the turnover and capital gains relating to the first three years of activity of the potential HTN payment institution with reference to the criteria defined above.

YEARS

Capital gains

Active rate

Management costs

Revenue

2019

0

3,25%

0,1%

136.188

2020

0

3,25%

0,1%

136.188

2021

523.800

3,25%

0,1%

136.188

Product distribution costs and pricing policy ("pricing policy") Considering the number of five customers identified, service distribution costs will not be incurred and a fixed annual cost of â‚Ź 500.00 will be adopted as a price policy, including all transactions for the individual web account. The criterion adopted for determining the annual cost of the web Â

12

account is a summary analysis of the costs proposed for corporate web bank accounts in the remote financial services market. Despite not having distribution costs, costs will be incurred for brand marketing activities through web ads.

Scheduled investments and related financial hedges The most interesting planned investments, and therefore the economic requirements of greatest interest for the economic feasibility of the opening payment institution as illustrated in the points above, concern the bonds for a total amount of 5 million in the first three years exclusively charged to the own funds of the institute with the objective of resettle in the stock market for the purchase and sale of securities as investment instruments, gradually and proportionate to the growth of the experience: know-how acquired over the years. The following are further planned company and structural investments and related financial hedging.

Additional scheduled investment: from the Group's cash holdings for the consolidated HTN, over € 500,000.00 of funds deposited in the company in electronic money to be used for investment and immediate availability are expected. Being the company reality of the existing group for about 15 years, they are only necessary  funds for the purchase of the IT system plus hardware equipment for the management and provision of financial services (attached financial services system to the request, for the public authority);  outsourcing costs for web payment account operations functions, "name" service providers.  funds for web marketing activities essentially aimed at increasing the

13

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brand's value for the launch of the payment institution business and in particular for the increase in quality that will cause on Group's products and services; (will cause a reduction in costs used to increase the quality of services).

The HTN Administration makes available the entire own funds of the same company to cover the costs of start-up and management of the first years of activity and the amount of the regulatory capital (higher than the application of 10% of the costs invested in the first year of activity, and well above the minimum capital requirement calculated with the B method, also with hypotheses of increase requests up to 20%).

Forecasting statements relating to the balance sheet, income statement and cash flow statement prepared according to the accounting standards applicable to financial intermediaries (IAS).

Synthetic exposure derived from the forecast balance sheets. The amounts are expressed in euros.

The institute reports the retained earnings that at the end of the year 2018 is expected to be over 17,800,000 over the share capital (plus legal reserve) of 360,000 which remains unchanged.

BALANCE SHEET ITEMS OF THE ACTIVE

2019

2020

2021

Institution cash and cash equivalents Financial assets valued at amortized cost (creditis due from banks) Financial assets measured at fair value with impact on the income statement: a) financial assets held for trading Current tax assets Prepaid tax assets

14.015.030 2.200.000

13.144.262 3.700.000

17.785.629 5.200.000

4.190.400

4.190.400

0

59.289 0 19.398.141

0 45.328 21.079.990

0 0 22.985.629

TOTAL ACTIVE

Â

14

LIABILITIES AND EQUITY ITEMS

2019

2020

2021

Financial liabilities measured at amortized cost: a) payables Financial liabilities of negotiation Deferred tax liabilities Capital + legal reserve Reserves Profit (loss) for the year

TOTAL LIABILITIES AND NET ASSETS

2.259.289 4.190.400 0 360.000 13.087.597 (415.023) 19.431.430

3.745.328 4.190.400 0 360.000 12.686.535 97.727 21.079.990

5.200.000 0 0 360.000 16.824.536 601.093 22.985.629

ECONOMIC ACCOUNT FINANCIAL INTERMEDIARIES, VOICES

2019

2020

2021

136.688 2.000 (609.000)

136.688 3.500 (25.000)

660.488 9.000 (16.000)

(474.312)

111.688

635.488

59.289 (415.023)

(13.961) 97.727

(79.436) 556.052

(415.023)

97.727

556.052

Interest income and similar income Interest expense and similar charges Other operating income and expenses + net result from negotiation PROFIT (LOSS) OF THE CURRENT ACTIVITY AT THE GROSS OF TAXES Income taxes for the year of current operations PROFIT (LOSS) OF THE CURRENT ACTIVITY TO NET OF TAXES PROFIT (LOSS) OF THE YEAR

Active Section 1 - Cash and cash equivalents - Item 10 Composition of item 10 "Cash and cash equivalents" Money in electronic, EURO currency.

Section 2 - Financial assets measured at fair value with impact on the income statement - Item 20 In drawing up the forecast balance sheet for the years 2019-2020 the following simplification logic is applied: the sale price of the securities valued at the end of the financial statements for 2019 and 2020 is assumed to be equal to the nominal value of € 100.00 . Not knowing the real selling price of the securities and being a future event, even if it could be estimated at a value different from the nominal value, (however uncertain) and not being a data that influences the dynamics exposed in the instance, the simplification of above to simplify the calculations. Further simplification used concerns the tax not deducted of 12.5% on the difference of issue (difference between the repayment value and the issue price of the security) from the purchase amount of government bonds because it does not cause changes in the calculations as it will not be added to the deed of sale in the year 2021 of the same securities.

2019: Number of bonds purchased for the financial year 2019 Government bond BTP TF 3,25% ST46 EUR: 9523 - sale price 105,00 € - date of enjoyment: 01/09/2014 - redemption value 100,00 € - price of issue € 99.707 - The bonds yield deferred gross annual interest, payable half-yearly on 1 March and 1 September of each year, equal to 3.25% of

15

the nominal value of the loan. Sales price at 12/31/2019 € 100.00 € - Total number of securities purchased in the financial year 2019: € 4,400,000.00 in 41904 securities.

2020: No purchases of securities are made.

2021: In the year 2021, after the month of September, 41904 government bonds were sold BTP TF 3.25% ST46 EUR sale price € 112.50 - total revenue € 4.714.200 - capital gain € 523.800 - Tax for 12.50% 65,475 from which the "deferred tax assets" credit of 26,000 euros is offset and the tax reduction caused by the costs of the financial year 2021 equal to 4,880 euros - Tax on the capital gain of 39,275 euros (from which deductible tax is deducted par to 4,880.00 euros) - Total tax for the year 2021, 34,395 euros.

Activities based on third party funds No investments are made in bonds with third-party funds for the first three years of activity in compliance with the business plan filed with the Supervisory Authority, Bank of Italy for the EU Member State, Italy.

PAYMENT SERVICES:

Quantitative information - Client liquidity with banks 2019 Balance at the end of the financial year

Maximum balance in the period

Average balance

2.200.000

3.000.000

2.500.000

Balance at the end of the financial year

Maximum balance in the period

Average balance

3.700.000

4.300.000

3.300.000

Balance at the end of the financial year

Maximum balance in the period

Average balance

5.200.000

6.200.000

4.500.000

Institute

2020

2021 Institute

Amount of payment accounts Conti di pagamento

2019 Balance at the end of the financial year

- With balance exceeding € 100 - With a balance of less than or equal to € 100

2.200.000

Maximum balance for the year 3.000.000

Average balance 2.500.000

2020 Balance at the end of the financial year 3.700.000

Maximum balance for the year 4.300.000

Average balance 3.300.000

16

2021 Balance at the end of the financial year - With balance exceeding € 100 - With a balance of less than or equal to € 100

5.200.000

Type of operation Arranged by customers Received from customers

Maximum balance for the year 6.200.000

Average balance 4.500.000

2019 Amount of transactions 1.031.250

Number of operations 7

Commissions perceived (°)

Expenses recovery 0

3.231.250

4

(°)

0

2020 Arranged by customers Received from customers

Amount of transaction

Amount of transaction

Commissioni percepite

Expenses recovery

1.031.250

7

(°)

0

2.531.250

3

(°)

0

2021 Arranged by customers Received from customers

Amount of transaction 1.031.250

Number of operations 7

Commissions perceived (°)

Expenses recovery 0

2.531.250

3

(°)

0

(°) All-inclusive formula with a single monthly fee: all transactions included in the fixed monthly fee.

Break-even point In the third year of activity, in September the break-even between invested costs (plus business costs) and total revenues was achieved. Based on the estimated financial statements that are compiled with the data obtained from the market analysis (study of historical data and market trends for interest obligations) by the technician regularly enrolled in the Order of Engineers, in compliance with this program of activities, it is highlighted the

17

important data at the end of the third year: a profit after tax of € 201,160.00; profit after tax, investment costs and operating costs.

Composition and evolution of own funds; Provenance and composition of funds: commercial activity carried out in the value-added internet services of the consolidated HTN for 15 years, activities

whose

economic

dynamics

have

allowed

the

business

relationship in filiation with the first telecommunications operator for Italy (ITC) (Group controlled by the same with reference to the contract and use of resources). The entire balance sheet, funds in electronic money deposited in the company, of the consolidated HTN derives from the relationship of filiation with the same operator. During the filiation relationship the HTN (as well as the consolidated Vas Adv from 2010 and for the next long period of activity, the only VASP operator of the group since 2019) collects by means of wire transfers with filiation mode (°) and therefore without financial intermediary from the first operator ITC, the entire balance sheet, liquid assets of the opening Institute in application of Article 3 letter n of Directive 2015/2366/EU and Article 2359 of the Civil Code of the Member State of the European Union, Italy, in the configuration of control external of the same ITC operator on the HTN (and consolidated Vas Adv) by virtue of certain contractual restrictions. Contract for the provision of the pay-call financial service 899 in which the ITC operator did not provide the only pay-call financial service 899 pursuant to Article 3 letter l of Directive 2015/2366/EU and subsequent amendments of the year 2017 in implementation of the European Directive 2015/2366/EU that the Member States of the European Union must have adopted by

18

January 13, 2017. The evolution of the company balance sheet that in the initial phase of activity will be exclusively composed of the own funds of the institute in electronic money it will be caused by investments in bonds that will affect it for the first years of activity quantified in the higher points; in the following, additional capital growth is expected due to investments in securities made with with in funds to deposit of third parties (a percentage of them) deriving from the deposited funds of the consolidated company and shareholders.

_________________________________________________________________________

(°)Transfer, filiation mode: Pursuant to Article 1 paragraph 2 letter f of Regulation (EU) No. 260/2012, currently in force (in 2018), hereby defined transfer mode between filiations for payment transactions which transfer electronic money pursuant to Article 2, point 2, of Directive 2009/110/EC of the European Parliament and of the Council of 16 September 2009 on the initiation, exercise and prudential supervision of the business of electronic money institutions, except where such transactions do not give rise bank transfer or direct debit to a payment account and a payment account identified by the BBAN or the IBAN; considered to the provisions of Article 3 (n) of Directive 2015/2366/EU for payment transactions between subsidiaries.

Evolution of own funds: to the current balance sheet (entirely composed of own funds in electronic money), the revenue obtained from the investments of the funds deposited by the consolidated and shareholders will be added over the medium term. In percentage points we expect to achieve a stable annual growth factor of 5% (500 points). At the end of the long term (over 10 years, around 15) the open institute will merge with some consolidated companies of the Group (subject to authorization by the Supervisory Authority), mergers aimed at increasing the Institute own funds.

19

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Calculation of mandatory minimum requirements, highlighting riskweighted assets - estimate of capital requirements for significant risks assessed as part of the internal self-assessment process of capital

adequacy

(ICAAP)

(Regulation

575/2013/EU,

Directive

2015/2366/EU) Introduction: from the company dynamics resulting from the activity program (investment program) you intend to realize, a certain risk is clearly identified: the temporal fluctuations in the selling price of the bonds which will cause a change in capital gains and possible losses for the year (in addition to operational risks, security and authentication of payment services, paragraph 6-6); for this reason we will have to measure the risk with respect to the cash availability that the sale of the bonds will be able to produce. In order to avoid situations that induce the sale of the bonds at times when the price is downward (selling at a loss), only the estimated percentage not used by the customers in payment transactions will be invested in the deposit funds. In the specific case, given that the consolidated companies and shareholders of the Group managed by the same administration as the institute, the risk of the solvency of the cash desk can be considered only in a stress test of the ability to coverage of the institution through own funds. The operative domain allows to define two variables (both variables depend on the time dimension): the price of the bonds, the quantification of the amount to be covered with own funds; the price of each security multiplied by the number of securities quantifies the turnover of the sale from which the total amount of deposit funds to be subtracted, less the amount of the same funds not invested in bonds (calculation made at time t). In the event of losses, the minimum opening Â

20

capital of the Institute must always be added, in addition to the amount of the regulatory capital defined by the minimum capital requirement calculated using method B, also with the hypothesis of increase requests up to 20 %. For the first three years and in safety it will have to be € 200,000.00 (increased amount of both 20% and rounded up for further security). For the following years we estimate a value of at least € 250,000.00 which comes for security reasons to € 500,000.00 composed of the share capital of € 300,000.00 fully paid up, the legal reserve of € 60,000.00 and a reserve of dedicated balance sheet of € 140,000.00 (in essence the amount remains deposited in a liquid company in electronic money).

At this point it is useful to propose some clarifications on the calculation of weighting factors that are based on the exposure of an institution. With reference to Article 111 of Regulation 575/2013/EU, the exposure among other deductions includes the reductions made to own funds and therefore is not considered exposure if it is to be deducted from own funds. For this reason, the institution in investing its own funds in securities will not have to weight any risk, moreover with reference to the investments that it may implement in the medium term in application of the supervisory provisions applied to the payment institutions and with reference to the protection of the funds (article 10 of Directive 2015/2366/EU) will be able to invest in safe government securities considered with a weighting factor of 0% (because exposures to the central administration financed in the same currency of the administration and because defined by the competent authority of the State Member of origin, Italy, low-risk liquid assets). For a more general logic and with reference to capital instruments and exposures in covered bonds, exposures that institutions can assume with the funds to deposit third parties

21

Â

(excluding payment institutions and electronic money institutions) Article 129 and Article 133 of Regulation (EU) 575/2013 define the weighting factors in consideration of the various possible economic dynamics; always for the latter (institutions) the application of article 92 that defines the regulatory capital in paragraph 3 letter a establishes the rules for determining the most ordinary exposures of institutions, while the letters b to f defines less common exposures and certainly of interest for larger institutions, exposures for which a further multiplying factor of 12.5 is foreseen on the sum of the exposures determined by the points from b to f.

Given that the investments made with the mutual funds will produce a capital gain, in case of sale of the bonds that can take negative values in some moments and therefore losses, the own funds will have to cover the negative changes. Two criteria will be adopted: the study of payment transactions carried out by customers (in the specific case in extreme security being known by management) that allows to limit investment in bonds only to mutual funds that the customer will not use for payment transactions (for a long period) and limit the same investments to the ability to cover the negative changes of the institution with own funds. In case of sale of the securities purchased with mutual funds (deposit funds) at times of price reduction, which under stress simulation are considered invested in bonds for 80%, the institute will have to guarantee with its own funds a complete coverage of losses caused by the sale of securities purchased with funds deposits (third-party funds) at the specific moment of price reduction. In this specific case, the institute has only one of the consolidated companies of the Group to which it belongs, as the most interesting customers who will produce mutual funds suitable for business objectives in the short to medium term; to extrapolate the criteria and therefore in the case of several customers, the coverage through own Â

22

Â

funds (considering equal percentage points of loss for the sale of titles purchased with own funds to cover losses caused by the sale of titles purchased with funds for third party deposits, in times of decline) must guarantee at least 20% of the mutual funds (losses due to negative price changes). It remains an extreme event because the study of payment transactions carried out by customers excludes that all customers exceptionally use all the funds deposited for payment transactions at the same time of decline for the securities. The model presented is based on the estimate of the minimum sale value of the last 5-year bond applied as the value for determining the minimum coverage capacity of the institution with its own primary funds for the financial year. This is a simulation of stress because as explained in the following points of the paragraph the monitoring of the protection of funds, will monitor daily securities purchased and securities that can be bought in the future in order to allow the administration to intervene on the changes (sale). The communication methods take place through the electronic transmission of the file containing the screens of the observed data close to the intervention values, with indication of the name of the garrison and date of the communication; the file thus supplied will constitute the news of the start of the protection measures. To limit losses due to unexpected sales of securities, margins of 5% higher than the purchase value for securities purchased with value close to the issue value intended for the institution's possession for long periods are defined for the discount phases; margins of 1% are defined for securities purchased at a price different from the issue cost and aimed at generating capital gains destined therefore for a short possession. The administration will carry out continuous studies of the companies of interest that issue bonds, securities also of other nations (England, United States, France, Germany) ...., With attention, to the dynamics of the business activities or the national gross product of a Â

23

nation, political stability, forecasts, data from the National Institute of Statistics and others (expansion of the long-term purchase market).

Analytical method: definition of the control inequality, single currency (Euro), pursuant to Article 3 of Regulation 575/203 / EU.

i= title purchased with third party deposit funds (each natural number from 1 to n corresponds to a type of security) h= title purchased with own funds (each natural number from 1 to k corresponds to a type of security)

t  time, when the control calculatio n is performed

M R (t )  operating margin of risk at the time t R M max (t )  operating margin of risk Maximum at time t

F p (t )  own funds at the time t Vi p (t )  price of sale of the title i at the time t FD Atot (t )  total funds for thirdparty depositsat time t

AFD (t )  funds to deposit of third parties at time t not investedin securities

24

N i (t )  number of securities i (equal) purchased at time t with third party deposit funds

Vhp (t )  sale price of the title j at time t

N h (t )  number of securities (equal) purchased at time t with the own funds of the institution Dc (t )  own funds, cash availability at time t not invested in securities n

R M (t )  A (t )  [ A (t )  Vi p (t )  N i (t )]  M max (t ) R

FD tot

FD

R M max (t )  20%  Fp (t ) 

i 1

k

 20%  Vhp (t )  N h (t )  20%  Dc (t ) h1

D (t )

c With always greater (factor of increase of at least 1,2) than the supervisory capital required by the prudential disciplines of the directive (EU) 2015/2366, articles 7,8 and 9 and of the regulation (EU) 575/2013 (part two and part three with exclusion of the sections that do not affect the economic dynamics of this payment institution).

The model can be applied at a time t + Δt where the Δt represents the short period in which it is desired to extend the control calculation of the risk margin; in this case, the economic quantities to be included are the economic forecast values in the short term.

25

Analytical method: definition of the control inequality, multi-currency, in application of Article 3 of Regulation 575/203 / EU.

Matrix definition of bond securities with third‐party funds

A (t )

matrix of dimensions [w x m] containing the platform of securities in which third party funds are invested and where w the variety of securities purchased in the same currency, and m the varieties of currencies in which the investments in securities are made; the elements of the lines make up the various bonds purchased in different currencies (i), the columns make up the various bonds purchased in the same currency (j).

aij (t )

the element is defined as the product of the number of securities of the same type i for the sale price at time t.

F (t )

f (t )

j is the column matrix whose [m] elements are constituted by the monetary conversion factors valued at time t of the [m] currency in Euro and therefore for the securities purchased in Euro it assumes value 1.

The product between the matrix

A (t )

F (t ) provides the column array

and the column matrix

T fd (t )

i cui [m] elementi 26

rappresentano l'insieme di titoli acquistati con fondi di deposito di terzi nei vari paesi con valuta diversa dalla valuta del paese di origine dell'Istituto, Euro per l'Italia e i cui importi sono convertiti nella stessa valuta, Euro:

w

A (t )  F (t )   aij (t )  f j (t )  i 1

w

  v (t )  ni  f j (t )  t (t ) i 1

p ij

fd j

fd

Then the resulting column matrix

fd j

t (t )

T (t )

has for elements

the total amount at time t of the bonds of the same currency

purchased with the third party deposit funds whose amount is converted into Euro currency;

defined with

D (t ) the column matrix whose [m] elements

d j (t )

are the total amounts of deposit funds in foreign currency j not invested, from which it results that total third party funds at time t are

27

FD (t )  [T (t )  D (t )]  F (t )  fd

m

  d j (t )  f j (t )  t j (t )  f j (t )  j 1 m

  [d j (t )  t j (t )]  f j (t ) j 1

FD (t )

With total deposit funds at time t, sum of the funds invested in securities and conversion of the amounts resulting in Euro (for those in a different currency) with non‐invested third‐party funds converted into Euro by the various currencies.

FD 0

By indicating with the total funds for third‐party deposits resulting from the accounting entries and therefore without changes due to fluctuations in the sale price of the securities, it is possible to define the control inequality as follows:

CONTROL DISEQUACTION:

FD  FD (t )  20%  C (t ) 0

pr

28

pr C (t ) represent the own funds the Institute of payment Where that can be used to cover losses that could cause the risks of exposure (market risk with regard to price fluctuations in securities and currency exchange, operational risk, security and access), therefore the own funds that can be used for the regulatory capital defined by the EU regulation 575/2013, and is calculated as follows:

B (t )

defined matrix of dimensions [q x m] containing the platform of securities in which the own funds of the institute are invested and where q the variety of securities purchased in the same currency and m the varieties of currencies in which the investments in titles are made; the elements of the lines make up the various bonds purchased in different currencies (h), the columns make up the various bonds purchased in the

bhj (t )

same currency (j), the element is defined as the product of the number of securities of the same type h for the sale price at time t..

F (t )

f (t )

the column matrix whose [m] elements j are Defined made up of the conversion factors at time t of the various currencies in Euro and therefore for the securities in Euro it assumes value 1;

the product between the matrix

F (t )

B (t )

and the column matrix

T pr (t )

provides the column matrix whose [m] elements represent the set of securities purchased with the Institute own funds in the different countries and to different currency, respect to the currency of the institution's country of origin, Euro for Italy, and whose amounts are

29

converted into the same currency, Euro:

q

B (t )  F (t )   bhj (t )  f j (t )  h 1

q

  vhjp (t )  ni  f j (t )  t jpr (t ) h 1

T pr (t )

t jpr (t )

Then the resulting column matrix has for

elements the total amounts at time t of the bonds of the same currency purchased with the institute's funds, amounts converted into euros.

pr

D (t )

d jpr (t )

the row matrix whose elements

Defined with are the total amounts in currency j of the funds of the institution not invested, you get it that the funds at t time can be used to cover risks are

30

C (t )  [T (t )  D (t )]  F (t )  pr

pr

pr

m

  d (t )  f j (t )  t (t )  f j (t )  j 1

pr j

pr j

m

  [d jpr (t )  t jpr (t )]  f j (t )  C pr (t ) j 1

pr D (t ) (converted n Euro), are bound by The Institute own funds, the supervisory provisions applied to the institutions of payment by the aforementioned Supervisory Authority and therefore will never be less than the capital requirement from these determined, that determines the capital regulatory of the institution (EU directive 2015/2366, articles 7,8 and 9) for which a increase factor of at least 1,2 is applied. The instrumental elements that make up regulatory capital, as reported in the study of the paragraphs above, are defined by Regulation (EU) 575/2013.

In conclusion the explicit "control inequality" for investments in multi currency becomes:

m

FD 0   [d j (t )  t j (t )]  f j (t )  j 1

m

 20%  { [ d jpr (t )  t jpr (t )]  f j (t )} j 1

31

once replaced

FD 0  FD(t )  20%  C pr (t )

The model can be applied at a time t + Δt where the Δt represents the short period in which it is desired to extend the control calculation of the risk margin; in this case, the economic quantities to be included are the economic forecast values in the short term.

The market risk, in finance, is the probability of obtaining a return different from the expected one from trading in financial instruments. In particular, it represents the loss or potential gain of a position or a portfolio of securities, over a specific time horizon, following changes in market variables, on the basis of which they are distinguished: Interest rate risk - the risk of loss resulting from adverse movements in the interest rate; Exchange rate risk - the risk of loss arising from adverse movements in the exchange rate of foreign currencies; Equity risk - the risk of loss arising from adverse movements in equities and / or equity indices; Commodity risk - the risk of loss resulting from adverse movements in the price of raw materials.

The three pillars (credit, counterparty, market and operational): the prudential regulation is based on "three pillars" provided for by the Basel regulations and by European regulations. In particular, the former introduces a capital requirement to address the typical risks of financial activities (credit, counterparty, market and operational); to this end,

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alternative methods for calculating capital requirements are provided, characterized by different levels of complexity in the measurement of risks and organizational and control requirements; the second requires intermediaries to adopt a strategy and a process to check capital adequacy, both current and future, remitting the Supervisory Authority to verify the reliability and consistency of the related results and to adopt, where the situation requires it, the appropriate corrective measures; the third

introduces

public

disclosure

requirements

regarding

capital

adequacy, exposure to risks and the general characteristics of the related management and control systems. For the institution HTN, the business dynamics illustrated above allow only the market and operating risks to be taken into consideration, extrapolating the extreme simulation and therefore of stress to the fluctuations of the sale prices of the securities: the requisite to absorb market and operational risk is the first pillar; the risk of concentration and "credit" risk relating to the sale to purchase of loans, loans is excluded).

It should be considered that the HTN institute does not carry out financing activities, investment programs, also with reference to the type of authorization requested from the Supervisory Authority, the only risks to which it could be exposed are market risks; therefore, transfer risks are also excluded. It must be considered that in application of the above criteria, the market risks in the specific case are only studied in a simulated dynamic and stress because even in a simulated dynamic (without stress of the system adopted) and therefore an increase in the number of customers who have deposit funds at the institution (services provided: web account) market risks are close to zero, negligible and do not deserve attention. Under stress conditions (in fact obtainable only in violation of the same prudential criteria and internal regulations) to study the market risks caused by fluctuations in the price of securities. Â

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With reference to market risks, the requirement is aimed at covering the losses that may derive from operations on the markets relating to financial instruments, currencies and commodities and with reference to operational risk the requirement is aimed at facing losses deriving from inadequacy o from the dysfunction of procedures, human resources and systems, or from exogenous events, including legal risk due to disputes with customers and/or suppliers. For the institute internal methods are applied to face the market and operational risks illustrated in the upper point of this paragraph. The "second pillar" regulation requires financial intermediaries to acquire processes and instruments (Internal Capital Adequacy Assessment Process, ICAAP) to determine the level of internal capital that is adequate to deal with any type of risk, even if different from those covered by the overall capital requirement ("First pillar"), in the context of an exposure assessment, current and future, that takes into account the strategies and the evolution of the reference context. The discipline identifies the phases of the process, the periodicity, the main risks to be evaluated, providing for some of them indications on the methodologies to be used. The responsibility for the ICAAP process is set by the corporate bodies, therefore specifically by the Sole Director of the institute. The total capital requirement adopted to HTN coincides with own funds.

The prudential control process complies with the proportionality principle, according to which: 1) the corporate governance systems, the risk management processes, the internal control mechanisms and the determination of the capital deemed appropriate for the coverage of risks must be commensurate with the characteristics, operational, dimensional and organizational complexity of the intermediary; 2) the frequency and intensity of the SREP take into account the systemic importance, the characteristics and the degree of problematic of the intermediaries, the institute. Pursuant to Article 99 paragraph 1 of Regulation 575/2013 / EU Â

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and Regulation 680/2014 Article 1, the institute will report its own funds requirements and financial information every three months, and the requirements for liquidity and stable funding requirements pursuant to Article 415 of Regulation (EU) No 575/2013 and will report data on the income statement and balance sheet every 12 months.

The prudential control process takes place at an individual level (the intermediary does not belong to a consolidated group of intermediaries), and in line with the proportionality principle will have a quarterly periodicity and if the market fluctuations or the increase in the services provided will require further checks, may reach a monthly frequency.

Third Pillar: in the context of prudential regulation, specific public disclosure obligations ("third pillar") are placed, aimed at favoring a more accurate assessment of the financial soundness and exposure to risks of intermediaries. The regulation provides quantitative and qualitative information that intermediaries must publish. Based on the proportionality principle, intermediaries commend the details of the information to their organizational complexity and to the type of operations performed. The regulations identify the frequency of publication, the relative exemptions, as well as the checks to be carried out on the information to be made to the public. For the HTN institute, it is sufficient, in addition to all the information on the services provided, to publish the share capital, the balance sheet and the quarterly report (even if semi-annual if sufficient) describing the risks assumed and the coverage capacity of the Institute in the delivery web channel; (profits will not be distributed, however minimum percentages, for the entire life cycle of the Institute, which is not determinable,

therefore

an

available

capital

requirement

that

increases over time).

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Types of risks: country risk is the risk of losses caused by events occurring in a country other than Italy. The concept of country risk is broader than that of sovereign risk associated with the performance of public securities, as it refers to all exposures regardless of the nature of counterparties, be they natural persons, businesses, banks or public administrations (risk that affects the economic dynamics of HTN in the long term). The following risks, even under stress simulation, are not configurable: transfer risk, basic risk, concentration risk, transfer risk, interest rate risk deriving from assets other than trading, residual risk, risks deriving from securitisations, risk of a excessive leverage, strategic risk, reputational risk; the valuation of liquidity risk is useful, which will have two components of the mutual funds used by customers for payment transactions and securities transformed into cash to cover payment transactions. The hypothesised events require, in the extreme case, that the every garrison the institute, do not carry out their work for many days and the administration, become untraceable for a long time. Considering that the customer who bring greater economic interest to the institute and therefore deposit funds is the consolidated VASP operator of the Group, having the same administration of the Institute and producing the interests of the same subjects (shareholders), the tools and processes for calculating the mandatory requirements, the measurement and risk weighting are completely performed by the model illustrated in the introduction of the this point (including the analytical model), in application of the second pillar (ICCAP).

For the management of operational, security and authentication risks (Chapter 5 of Directive 2015/2366 / EU, Articles 95 to 98), attention is hereby given to illustrating the prevention, control and mitigation mechanisms of operational risk envisaged by the same articles that result content (limited number of customers, number of expected payment transactions not excessive) and with regard to outsourcing, it will be Â

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adopted as an additional solution to reduce the losses due to the operational risks, safety and access, adequate insurance taken out by the supplier against the same risks. The infrastructure the institute must, be considered, as illustrated in paragraph 6-6, which causes an increase in operational risk, which is in any case limited considering the limited volume of payment transactions and the internal double check procedure for each individual payment transaction (similar to the procedure of double revision adopted in the scientific publishing sector) aimed at the elimination of human errors in case of refusal both of accreditation as not compliant for example to the unique identifier or data of the payer (and possibly of the beneficiary) both for debit transactions such as credit transfers or direct debits due to incomplete data or errors in the unique identifier. The controls are performed with the help of computer systems that automatically perform up to 50% of the procedures: comparison of the data with those present in the systems adopted with the help of an external supplier; (paragraphs 6-5 and 6-6). Payment transactions are divided into two groups, less than € 15,000.00 and higher than this amount (including related transactions that exceed this amount). When lower, continuous controls are identified in the correctness of the data for customers with whom a relationship of trust and knowledge of financial dynamics is established, when higher and for new customers are added the continuous controls of prevention of the financial system against illicit uses such as recycling; with regard to this last point, each new customer is checked against all payment transactions for the first year (in the event of suspicion, continuous control extends at least two years) and subsequently exposed to monthly periodic checks for payment transactions at the below € 15,000.00 while still checking transactions above this amount (even if the amount is exceeded by several transactions that are connected: same payer, same beneficiary). The periodic checks have the objective of

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verifying any changes in the financial dynamics of the client (activities, sources of income and any other useful information). For each new client, checks will be carried out on the origin of funds used for payment transactions and as the institute only provides a continuous relationship (web account), the intensity of the controls will only fade after having achieved a high degree of knowledge on the activity carried out by the payment

account

user.

However,

checks

and

therefore

periodic

investigations will be carried out to identify any variations on the activities carried out by the users of the payment accounts; in addition to the obvious customer identification activities (electronic identification as indicated in paragraphs 6-5 and 6-6), investigations will be carried out on the user's administrative documentation, income tax return, documents attesting the origin of funds used in payment transactions, deposited financial statements, and if necessary, accounting entries for payment transactions deemed to be suspect. Initial investigations will be conducted on the potential new customer by querying all available electronic sources (institutional websites of the State, web information) and crossed with the information provided by the client in filling out the forms when requesting activation of the web account. All the controls described here will take place in application of the directive (EU) 2015/849, with the distribution of the necessary resources as illustrated in paragraph 6-4. Regarding this last point, in consideration of the limited size of the institute and the limited number of payment transactions (financial statements, Annex G), the functions to the garrison for security in charge of overseeing the use of the financial system through the services provided, the control of fraudulent access to electronic payment accounts, the control of the regularity of payment transactions and the control for the prevention of money laundering and terrorist financing are carried out by the same human resource which, in the project dimensions, is an optimal solution for the Â

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reduction of errors in the performance of control procedures, being a dynamic possible for the small size and number of operations; the same employee in the performance of his duties is found to have a more complete knowledge of the parties involved in the payment transaction and not the relative dynamics that generate the same payment. In a dynamic of enlargement, of an increase in the size of the institution and therefore of the number of customers and the number of transactions, in the control scheme illustrated above, it will be necessary to add an adequate monitoring unit with a fixed subdivision of the web accounts that to be control by distributing the number fairly based on the operational capacity of the garrison. Employees of the Institute will be bound by contract to the code of ethics attached to the application filed for the public authority and exposed to controls and disciplinary measures internal provided for in the employment contract. The institution binds its own funds in observance of regulatory capital, as illustrated at the end in paragraph 6-4 to address operational, security and access risks, in addition to the own funds required for the regulatory capital required by the control inequality defined in the points higher than this paragraph in application of Article 3 of Regulation 575/2013/EU.

6 - 4 Report on the organizational structure The paragraph contains a report on the organizational structure, based on the legislative framework. The report is accompanied by regulations concerning the main company processes (eg internal Â

39

regulations, credit) Considering the size of the opening institute, the number of financial services provided (web account) web banking account for credit transfers and deposits (direct debits for bills payment), given the limited number of customers, mainly consolidated and partners of the Group, the Manager Corporate Anti-Money Laundering (RAA) is identified in the control body and with the shareholders who will perform the functions as assigned personnel; (professional requirements in this regard). For the management of the information flow, specific software from an accredited supplier (outsourcing) will be used in the sector of credit institutions, public interest entities (including the management of the Single IT Archive); further information regarding the operational and money-laundering operational control functions in paragraph 6-6, “IT security, software and hardware systems”.

For the above reasons, given that it is a very small intermediary, the volume of payment transactions, the number of customers making payment transactions, considering that only the consolidated group VASP operator will have funds to deposit greater interest in the entrepreneurial objectives of the Institute, illustrated above, considering the very small size of the workforce, in application of the principle of proportionality the corporate bodies are composed of the administration and the control body in the following diagram: - a. "Corporate control functions" - b.

"Anti-money laundering function" is entrusted and carried out by the control body; c. "Body with strategic supervision function" - d. "Body with management function" - f. "Corporate function": they are entrusted to the administration..

The offices set forth in this paragraph can not be subject to conflicts of interest because the interests of the institution are the interests of the

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consolidated customers of the company filing group (no intermediaries) and therefore of the shareholders. To be considered that the shareholders do not assume positions for which the requirements of independence in the workforce can be configured, the only hypothesis of conflict could arise between the two functions strategic supervision and management function (same members of the consolidated Group, customers of the Institute) . In this regard, effective organizational and administrative provisions will be maintained and applied in order to take all reasonable steps to avoid that conflicts of interest negatively affect the interests of the shareholders as follows: monthly documented meetings in which the same shareholders can inform themselves of any changes in the strategies and methods of implementation of the same through the management adopted for the current year. In the case and, as expected, the institute remains in the stable dynamic, the meetings could be postponed annually. If the above provisions are not sufficient to ensure, with reasonable certainty, that the risk of damaging the interests of members with administrative powers, as members of the group, will be informed by the supervisory body clearly in the meeting before to act on their behalf, on the general nature and / or sources of conflicts of interest as well as the measures taken to mitigate the risks involved. The actions of the corporate bodies will always be documented through a report prepared in the periodic meetings with an illustration of the decision-making process, with the related motivations that determine them, in order to allow a control on the management actions and decisions taken. Compliance with the civil law regarding the interests of directors remains unchanged. c. "Organ with control function": Considering that the financial intermediaries registered in the Register provided for by the Public Authority are public-interest entities, pursuant to Directive 2006/43/EC which the member states have adopted by 29 June 2008 (Chapter X, Â

41

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Articles 39 to 43) and of regulation (EU) 537/2014, they are equipped with a control body which is monocratic for this institution. The appointment and related communication to the Public Authority, (for the Member Country Italy: Bank of Italy) of the single-checking control body as amended by Article 3 of the Articles of Association of the corporate object attached to the application (Annex A), will be carried out within thirty days from receipt of the authorization to exercise the activity. A trusted auditor will be chosen among the Group's trusted consultants (non-member or with other roles in the Htn Group), subject who will assume the function of controlling body.

The body with the control function, respecting the powers of the other bodies and in collaboration with them, then the senior management and the management body: oversees compliance with the laws, regulations and by-laws, on proper administration, on the adequacy of the intermediary's organizational and accounting structures (with access to the minutes of the meetings and close participation in the same). It monitors the completeness, adequacy, functionality and reliability of the internal control system (attachments of the meeting minutes kept by the institute); ascertaining the effectiveness of the structures and functions involved in the control system and the appropriate coordination between them, it will have privileges of access to the managerial system of the platforms that perform the Institute's financial operations for only reading and access to the records accounting of the company, institute, being able therefore to supervise on the correspondence of the ICAAP process (superior paragraph) and requirements established by the normative, will estimate the degree of adequacy and the regular functioning of the main organizational areas. In meetings it can promote corrective actions of the shortcomings and irregularities detected. The observations, proposals and verification activities of the body with control function will be adequately documented and kept. Participation in the meetings of the control body, Â

42

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privileged

access

to

the

management

system

(web

accounts

administration, accounting records), access to the minutes and related attachments of the periodic meetings allow the body with control function to monitor the operation and 'observance of the organizational and management models that the intermediary adopt to prevent major offenses and violation of internal regulations. During the periodic meetings, the aspects relating to the crimes that may be committed within the financial activity of the institution as well as from the implementation of the investment program, in which it is evident, in application of the principle of proportionality (dimensions and type of operation of the institute) will be analyzed, that the phases at risk are the violation of access to web accounts for fraudulent uses (only theft of credentials to users) and the use of the financial system by third parties, for offenses such as recycling and terrorist financing. As explained at the end of paragraphs 6-3 and paragraphs 6-5 and 6-6, fraudulent use is almost impossible, therefore in meetings as well as a verification of the absence of events that may cause changes in the management of financial services compared to to the present program, attention will be paid to the recycling control procedures and every time the hypothesis of making changes with respect to the events occurred since the last meeting will be evaluated to increase the effectiveness and efficiency of the controls illustrated at the end of paragraph 6-3. Resources economic are allocated from the opening of the institute to the outsourcing of information resources beyond the costs of access to institutional sites where present. During the periodic meetings, the possible need to devote additional financial resources, for example for implementation of information flows with new systems or platforms available on the market, will be evaluated. The body with the control function for the performance of its duties, being able to have adequate information flows from other corporate bodies and control functions, will Â

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maintain coordination with these latter functions and with the person appointed to audit the accounts, at the purpose of increasing the degree of knowledge on the progress of company management, also making use of the findings of the assessments carried out by these functions and subjects. Promptly informs the Supervisory Authority (Bank of Italy) of all acts or facts, of which it becomes aware in the exercise of its duties, that may constitute an irregularity in the management or an infringement of the rules governing the activity of the intermediary. The interaction between the activity of the body with control function and the supervisory activity contributes to the strengthening of the overall supervisory system on the intermediary. With reference to the subject charged with the statutory audit of the accounts (external audit) in application of Directive 2006/43/EC, herein of Article 42, paragraph 1 letter a, in consideration of Directive 2013/34/EC, article 34 paragraph 1, Directive amending Council Directive 2006/43/EC (78/660/EEC and Council Directive 83/349/EEC and repealing Directive 84/253/EEC), a professional qualified for statutory auditing will be appointed with reference to to the norms indicated, external to the institute's organs.

The functions of the supervisory body are entrusted to the control body.

The control body will oversee the operation and compliance with the organizational and management models adopted by the institute that are suitable for preventing offenses and as indicated above will propose any necessary updates. The current size of the workforce and the organizational structure of the prospective institution do not require further control models beyond those described in this activity program, since the key controls necessary for the protection of the financial system from offenses, control over compliance with regulations, the procedures for using the administrative system and for the management of payment services are defined, in which is possible to identify hypotheses of Â

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violations in the protection of sensitive, financial and administrative data of clients (only reading functions are available to the exclusion of administrative body that has access to all functions). Internal disciplinary measures are envisaged based on the entity of the offense committed, for example, for privacy violation, the procedures established by the EU regulation 2016-679 will be carried out by the administrator and the disciplinary system will be applied to the author of the damage violation caused, in case of violations that may affect the professional orders of belonging of the subjects who hold positions in the bodies of the institute and always by the administrator will be forwarded reports to the order of membership (in case the violation affects the administrator the notification will be made by the control body). The control body with the purpose of proposing and introducing changes to the model adopted for appropriate prevention will monitor the dynamics that can lead to offenses through the entire platform of the institution accessible only in reading mode in which all the activities carried out are archived for and within the Institute; will have the duty to detect any illicit actions and to communicate them to the administrator for the implementation of the disciplinary systems suitable to prevent the reiteration. In addition to the supervisory body and in carrying out the management, operational and management functions, the shareholders will also carry out the same controls in order to create a cross-system in which a dynamic that is particularly exposed to illicit (even negligence) or a unlawful action committed to the detriment or interest of the entity, it can hardly escape. In the event of an increase in the number of customers, in the long run, which would imply the increase of the workforce, the following additional criterion for prevention will be adopted: only subjects belonging to a professional body recognized as such by the Ministry of Justice will be hired, as part of the company management (information engineering, economy). The subordinate functions carried out Â

45

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by the collaborators will allow this institution, payment institution, to determine the activities in which crimes could be committed, specific protocols will be provided to plan the formation and implementation of the decisions of the entity in relation to crimes to by prevent, with periodical meetings of the administration and the control body. The entire staff of the prospective institution is obliged to provide information to the supervisory body on any wrongdoing of which it becomes aware or of situations that could cause offenses. The control body guarantees the anonymity of the signaling device. The appropriate financial resources to prevent the commission of crimes and in the case of the choice of collaborators (ranking system based on the candidates' credentials) will be charged to the Institute's own funds. The increase in the cost of labor due to the selection of professionals will be attributed to operating revenues and if necessary to own funds. It will be adopted as a disciplinary system for those responsible for the unfounded reports the compensation of the malice caused to the reported and to it reimbursed; for example, the reported employee will be compensated for the amount equal to the pay deducted for the days of suspension that he would have if had committed the unlawful fact is unfounded; for more serious events compensation will be made with recourse to civil justice; unlawful acts considered serious may also constitute just cause for dismissal. All sanctioning measures taken for disciplinary violations will occur in accordance with the Statute of Workers' Rights for the member state in which the Entity is based, Italy.

It should be noted that the Institute's top management in determining the address functions of the management and in performing the other roles envisaged in the following activity program, makes use of the valuable advice of prominent representatives in the field of business management consulting, the control, revision, banking economy, and relevant legislative aspects; makes use of invaluable advice on legal, constitutional and civil Â

46

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law matters and any other matter may concern the Italian law code and the European Community Law through the consultants of the HTN Group who have been collaborating for a long time with high direction of the institute.

The additional functions indicated below will be included in the activities of the management body: h. "Important operational functions", an operational function for which at least one of the following conditions is verified: o an anomaly in its execution or its non-execution can seriously compromise: i. the financial results, soundness or continuity of the activity of the financial intermediary; or ii. the intermediary's ability to comply with the conditions and obligations deriving from its authorization or to the obligations set forth in the regulations or concerns operational processes of the corporate control functions or has a significant impact on the management of corporate risks. It is important to define in detail the important operational function aimed at controlling the activities carried out with the institute's mutual funds and own funds (protection for the protection of deposited funds) which highlights the role of the shareholders with management powers, in charge of control price fluctuation of the securities and the methods of communication that, in compliance with the prudential provisions, communicate with the administration in the manner indicated in the previous paragraph; the remaining necessary business functions will be carried out by the Administration with the support of the members. i. "Risk management process" the set of rules, procedures, resources (human, technological and organizational) and control activities aimed at identifying, measuring or evaluating, monitoring, preventing or mitigating, as well as communicating to hierarchical levels appropriate all risks assumed or assumable in the various segments, and with reference to the risk assessment of the last paragraph of the top paragraph (paragraph 6Â

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3), taking into account, of an integrated logic and also the reciprocal interrelations and with the evolution of the context external is entrusted to the management, the Administration of the Institute, having acquired from the first years of activity through the holding company (engineering company) of the Group relevant experience in techniques to perform market analysis aimed at feasibility studies of investment programs in application of the historical data survey method and the method of forecasting the possible evolution of the data the market of interest (simulations of different scenarios to identify the different consequences with the identification of the maximum and minimum impact on the economy of the activity).

The functions of "outsourcing" for the provision of the service of the web account will be entrusted to the accredited supplier in the sector (sole supplier for outsourcing). Attached to the application (request for the Supervisory Authority) a copy of the service offered by the supplier with all the technical and management information of the service. The outsourced function consists in providing the web server system remotely through which the institution can provide the web account and therefore the administration system for the management and opening of the accounts that make up the web account service, a system that sanctions controls, management and consultancy for the compilation, for data collection that feed the AUI (data collected during the anti-money laundering prevention controls in compliance with the directive 849/2015 / EU subject of studies of previous publications, publication 2018-19.04), allows HTN to provide financial services in compliance with the proposed functional, safety and quality characteristics; equipped with functions to scan access in order to identify attempts to unauthorized access to accounts, the list of all Â

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payment transactions performed by account, subject, date, amounts and any other parameter is necessary to improve the quality services provided and the related security. The service provided by the selected provider (Full Outsourcing) for outsourcing is provided in a totally controlled manner by the Institute in the sense that every activity, event generated in the web account delivery system, can be caused either by the end customer or by the HTN institute. The set of daily controls carried out by the Institute in the fulfillment of the supervisory provisions (end of paragraph 6-3 and paragraph 6-5) provide direct and daily control of the level of security guaranteed by the supplier for outsourcing: safety hardware equipment and IT structure.

The characteristics of the information system in relation to its operational dimension and the information needs of the corporate bodies to make informed decisions consistent with the corporate objectives adopt the following procedures: automatic operations performed by the software supplied by the same provider of the outsourced services for the execution of payment transactions (computer structure and hardware for the web account), production models of acts made and viewed before their use, programs for the preparation of financial statements, institutional sites with support functions for business management, data base (dating ) of all the information concerning both the activities of the Institute and the Group, organized by functions, names, subject and unique identification codes.

Being information generated during ordinary business activities will be verified before re-use to identify any errors that the IT systems would not have detected in automatic mode. For information security, the protection of sensitive data can be found in paragraph 6-6: Computer Security web infrastructure. The EDP manager is the same Director of the Institute with Â

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experience in the production of workstations and servers (assembled) complete with operating systems and software applications of third parties, with own brand from 2004 to 2011, programming, dating, programming experiences web, javascript matured over the years 2006 to date for the corporate Group, data center security, ability to analyze log files to identify suspicious situations (attempts at unauthorized access). For the emergency and business continuity plan, refer to the paragraph: Computer security, web infrastructure.

The administrator of the HTN Institute with strategic supervision function promotes the internal dialectic and the effective functioning of the corporate governance system; he holds an executive role and carries out management functions with the collaboration of the Group's shareholders; the internal control functions will be performed by the control body.

The compliance function to assess the adequacy of internal procedures with respect to the objective of preventing the violation of mandatory rules (laws and regulations) and self-regulation (statutes, codes of conduct, selfregulatory codes) applicable to the financial intermediary, is carried out by the control body. To this end, the body continuously identifies the rules applicable to the financial intermediary and the activities it provides and measures / assesses the impact on the processes and on the company procedures; applies where necessary in the start-up phase, organizational and procedural changes aimed at ensuring adequate supervision of the risks of non-compliance with the identified rules, verifies in advance and subsequently monitors the effectiveness of the organizational adjustments suggested for the prevention of the risk of non-compliance.

The Director performs the function of protecting and increasing the value of the Institute for the benefit of its stakeholders, supporting the objectives through the preparation of the methodological framework for monitoring all Â

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future activities (therefore, evolution and widening of the choice for the supply market: securities ), continuous improvement of the decisionmaking process by evaluating the results obtained with the instructive tools adopted for previous decisions that if sufficient will be deemed reliable otherwise improved (a large number of tools to support decisions is a cause of consumption of resources so the selections if adequate must be kept at the expense of a policy of continuous increase and variation of the tools to support decisions). Of course they must be added if not adequate for new types of interventions and therefore new types of decisions: events present in addition to the start-up phases of an entrepreneurial activity, in the phases of expansion of the outlet market types, changes in management models, and therefore rare events. The management risk, will be kept separate from the operational functions for risk management, including the latter, in operational management.

Professional requirements of administrators.

Accounting information system, methods and keeping of accounting records, and protection of deposit funds.

The accounting information system adopted ensures a high degree of reliability. It allows the correct and timely recording of all company operations and management events, in order to provide adequate and upto-date information on company operations and the evolution of risks. In particular, they make it possible to reconstruct the activity of the financial intermediary on any date, usually for each of the services provided (the web account only). The data will be stored in a suitable granularity to allow appropriate analyzes and aggregations on the company's operations. The software of the selected supplier will be adopted through the market Â

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analysis performed for the design of the investment program, object of the present business plan. Institutions establish and maintain appropriate accounting records: distinctly for each client, the sums of money received to be recorded in the payment accounts; and of the assets in which the sums received were invested. These evidences indicate, among other things, the depositaries of the financial instruments in which the sums of money received from the clients may be invested, according to the provisions of paragraph 6-3. The evidence will be updated on a continuous basis and promptly, so as to be able to reconstruct at any time the position of each customer with certainty and will be regularly reconciled with the statements produced by the depositaries.

The sums of money received from customers and recorded in the payment accounts from the institution will be protected in compliance with the European directive (EU) 2015/2366 (Article 10, paragraph 1, letter b); they will be invested in qualified debt securities deposited with authorized depositaries; invested in units of harmonized mutual investment funds whose management regulations provide only for investment in qualified debt securities or money market funds. The institution applies the protection requirements under this point to sums received from customers and recorded in payment accounts that are not delivered to the payee or transferred to another payment service provider by the first business day following the day on which the funds have been received. In the event that the sums of money received from customers and recorded in the payment accounts are usable for payment transactions, the methods of protection of the sums of money indicated above only apply to the percentage of the sums of money to be used for future payment transactions . If this percentage is variable or unknown in advance, the institution estimates a representative percentage that is presumed to be used for payment services, provided that this representative percentage can reasonably be Â

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estimated on the basis of historical data; periodically, the institute verifies the congruity of this percentage with respect to the effective use of the sums of money made by the customers. Being the only customers of the opening institution, the consolidated companies of the Group (and related shareholders) administered by the same administration of the HTN institute, the percentage of funds used for future payment transactions is perfectly known. The institute will communicate to the Supervisory Authority for Italy, where it is based: the decision to apply the aforementioned methods of protection only to a percentage of the sums of money received from customers with the related reasons for this decision and the modalities with where this percentage has been determined and will communicate at least annually, the results of the checks carried out in relation to the appropriateness of the determined percentage.

Conclusion: as indicated in the request made to the Supervisory Authority, the institution will manage the payment transactions of the subsidiary Group in which it is consolidated and therefore even if from the summary tables of the economic needs are payment transactions of 5 million in three years, the growing own funds of the Institute should be considered that will remain deposited in the Institute for future payment transactions or will be gradually invested in secure bonds for certain amounts of more than 3 million from the first year, and therefore limited regime is to be excluded even if it is a small institution.

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6 - 5 List and characteristics of payment services The payee payment institution will provide the payment services indicated in paragraph 6-1 which allow the customer to enter into a contract with the open HTN institute for the opening of a payment account for the management and execution of transactions of payment (bank transfers, direct debits, debit card payments, prepaid credit card) with the exclusion of credit agreements, loans in any form (articles 1842 and 1813 of the Italian Civil Code): hereinafter referred to as web account in application of the Directive 2002/65/EC for the distance marketing of financial services. The services provided with the web account financial instrument will be managed with the Full Outsourcing system of the accredited national supplier selected through articulated market analysis, the same supplier for the system outsourcing service including the IT and hardware infrastructure that allows the provide the web account; the Full Outsourcing system for the management of the bank account (web account) includes all the functions related to the management, activation, compilation and data collection for the AUI (data collected during the antimoney laundering controls in compliance with the directive 849/2015/EU subject of studies in publication 2018-19,04) including advice and support for all phases of the web account service, starting from the phase following the customer procurement (functions carried out through specialized high quality software). This is an all-encompassing solution, for the specific needs of the potential HTN institute. It should be noted that in application of the principle of proportionality for the institution, and of the levels and numbers of outsourced processes (management of the infrastructure for payment services, storage, support and advice through advanced software in addition to the activities carried out by the Administration of training) risks deriving from outsourcing are excluded; to consider the stipulation of adequate Â

54

Â

insurance of the supplier to reduce the impact of operational risk, access and of security that could derive from the supply.

For all the services activated and therefore the related contracts and attachments will be managed and stored by the institute with computerized systems for archiving, processing; contracts and documents relating to discontinued web accounts (including backups of all operations performed by the user) will be retained for a period of 10 years.

The IT system will not allow overflow and will not allow the execution of a payment transaction without the authorization of the payer, the user of the web account, which will have to enter the password DISPOSITIVE. In synchronization with the insertion of the dispositive password, the system generate the confirmation message, which the user receives in the manner illustrated in the next point and which he must use to confirm the start of the payment execution process; only after further confirmation the institute considers the execution instruction received. The data for access to the web area of use and management of the web account, the dispositive password, the further confirmation of the payment transactions and the access signals via sms that the user receives as indicated in the following point, constitute in the complex a strong authentication procedure, in compliance with the new security provisions provided for in Articles 97 and 98 of Directive (EU) 2015/2366 and in compliance with the final guidelines on the security of EBA internet payments issued pursuant to Article 16 of the Regulation (EU) n. 1093/2010 of the European Parliament and of the Council, dated 24 November 2010. The dispositive password is known only to the user and to the system that automatically checks the correct insertion before allowing the payment transaction, the institute can to verify the correct insertion or reports of repeated attempts to insert it (same for the authentication procedure for access to the web account). In case of loss, the user of the web account must activate the security procedure to Â

55

Â

reset a new password; after completing the verification and security procedures by the management body and contacting the EDP manager, he will receive a new password that will allow the creation of the new password dispositive using the web system, unlike the access data (password or identifier) that can be recovered through a less complex procedure. always behind controls carried out by the management department and responsible for EDP; also in this case provisional access credentials will be provided that the user will have to change at the first access. The main difference is that the Institute can access the web account and possibly suspend a payment transaction but can not perform operations for which the dispositive password is required (it is known only to the customer) unless the monthly fee is credited; also direct debits (bill payment) ordered by the customer and to be confirmed through the device password (event in which the user has to set the maximum credit amount) can only be blocked by the management body in case of anomalies, requests of the customer (both semi-automatic using the web account blocking form, or executable by the web account autonomously within the times foreseen by contract and always using the password dispositive).

The maximum amount for direct debits can be changed by the user always by means dispositive password; the system does not allow charges greater than the maximum amount. The institute oversees the regularity of all operations carried out by the client. In case of theft of the access credentials or of the dispositive password, the user must follow the simple procedure provided for by contract and indicated in the web account usage guides to request the suspension of all functions of the web account, request that if it occurs within the 24 hours after the theft of the credentials guarantee zero losses (as better illustrated below). Therefore no deductible will be applied for unauthorized transactions, not possible (the customer can not perform unauthorized operations). With reference to Â

56

Directive (EU) 2015/2366, if the payment service user does not violate the provisions of Article 69 of the Directive, and excluding that he acted with intent or gross negligence, the first point of the paragraph will be applied 1 of article 73 of the same directive, charging the user for unauthorized payment transactions for an amount not exceeding € 50; the third point of paragraph 1 of article 73 (same directive 2015/2366 / EU) is applied if the user does not fulfill the obligations of article 69. For contract the user must report the loss or theft of the data for access to the web account within 24 hours, at the Institute considering that the notifications received after 8.00 pm and up to 8.00 am of the following day are considered received from 8.00 am; furthermore, considered to Article 69 paragraph 2 of Directive (EU) 2015/2366, it is the user's responsibility to keep the data important for security separate, at least separate the email for further confirmation by the device password and credentials to access the web account, which excludes the possibility that the user may lose or suffer a theft of security data without realizing it. In order to reduce risks, the user can set limits on the maximum amount of individual transactions and on the maximum daily amount, in addition strong authentication will be applied as defined by the same directive (EU) 2015/2366 article 4 point 30 and related requirements, Articles 97, paragraphs 1 and 2; the user will receive at the e-mail address indicated by him, the notice for each payment request sent to the institute a few moments after the transmission for the final confirmation (further confirmation) and will receive in the same e-mail notification of every request for accreditation received promptly upon receipt at the institute (the e-mail address may be changed by the user at no additional cost as indicated in the following point). The payment transaction can be sent to the institution only after the insertion of the dispositive password that is known only to the user of the web account, whose execution will take place only after further confirmation by the user in the manner described in

57

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the following point. The sophisticated systems adopted by the institute will perform these last functions in automatic mode. The management of the security of direct debits and similar to credit transfers, the user after receiving the notice of direct debit activation request by the institution in the email for operational communications and agreements made with the counterparty, must access the web account and enter the dispositive password, as well as setting the maximum credit limit; the execution of the procedures for activating direct debits can be carried out by the institute only after the user has further confirmed the payment transaction requested through the confirmation communication received in the operative email following the insertion of the device password. In case of loss or theft of all data (login credentials, device password, change of pec address and mobile phone number), the user with signature with active digital identity will have to fill in the forms again for the mobile phone number and pec subscribed with digital signature and forward them to the institution as indicated in the contract and in the web guides after following the web account blocking procedures in case of theft; the e-mail for further confirmation of payment transactions, must be entered by the user, once the data recovery procedures have been completed. The web account allows the user to update all data relating to him, such as any change of domicile, renewal of the identification document used to activate the account and others; operations that require the dispositive password.

Illustration of the control mechanisms for security and access during activation and in the operational phase of the Â

58

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web account The user can request activation of the payment account through the web channel in which he will insert an email address, where he will receive all the electronic documentation in pdf format that he will have to fill in and forward to the pec address of the institution indicated in the documentation. address that the user must use for subsequent requests to modify data deemed important for security in case of theft or loss, such as the mobile phone number, the user's e-mail address and the e-mail for operational communications (confirmation of payment transactions); after access to the web account, the user can change all data except for the pec legal email address, from the management panel. The legal e-mail address must be in the institutional sites as registered in the person who activates the account (signer with advanced digital signature), so if personal to the person, if legal entity to the company and the signer with advanced digital signature of the activation documents must correspond to the legal representative indicated always in the institutional sites. Once the control and verification procedures have been completed, the institute activates the account giving communication to the user in the legal mail indicated in the signed documents with an advanced digital signature and certified by an accredited body; will receive with the same communication the authentication credentials that the user will have to change at the first access. From the dedicated web panel, the user will ask the system to generate the first device password that is automatically received from the server at the pec address (mail legal); the code sent in this way is known only to the recipient, he can always change it periodically using the last available password dispositive in his possession. In case of loss it will have to fill in the appropriate pdf document that has received with the initial documentation and forward it to the institute's mail pec indicated in the activation documentation (for the password recovery pdf document it can Â

59

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always download the request through the web channel); the form must be sent from the last legal e-mail address communicated at the institution from the user if it has been modified with respect to that indicated at the signing of the contract. To eliminate the risks of fraud, the payment transactions requested by the user to the institution, through the web account (semi automatic) will be processed by the same institute only after the user has confirmed via the communication received in the email address also not legal e-mail indicated in the initial documents signed or set by the web account management panel; the received communication contains a confirmation link that allows the system and in automatic mode, to start the procedures for the execution of the requested operation within the time agreed by contract (48 hours) after it is opened (clicked). The communication is automatically forwarded by the system as soon as the user of the web account confirms the payment transaction by entering the device password. For the protection of only the financial and sensitive data of the user from unwanted access (theft of the only data to access the web account), the system will communicate via sms to the user every access made to the account at the time it takes place. For the reasons described here the email pec, necessary for the activation of the web account, generation of the dispositive password even in case of loss, change of the mobile phone number, spread pec e mail ordinary for operational communications, are considered important data for the security and can only be modified with the direct intervention of the Institute (responsible for supervising the verification and safety procedures by the management body and contacting the EDP manager); the request for modification of the data considered important for safety (even just one of the three) must be forwarded to the institute through the pec indicated in the activation documents (the mail legal pec) or subsequently modified by means of the legal mail change form (forwarded to the institute with the new mail legal Â

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the user's). The electronic form in pdf to be filled must be signed with the advanced digital signature active of the contract underwriter. The mobile phone number must also be updated by the Institute, if the user has changed the number before the change of e-mail legal and can not intervene from the panel manager of the web account for loss or theft data, being necessary for to complete the change pec. Through the web account the user can make payment transactions for the transfer of funds (virtual currency, electronic) direct debits, or receive credit funds (always virtual currency, electronic) by bank transfer with IBAN, BBAN, (also BIC, SWIFT) in compliance with Regulation (EU) 260-2012 and credit transfers without IBAN, (BBAN, BIC, SWIFT) for debits pursuant to Article 1, paragraph 2, letter f (excluding direct debits). Credit transfers will be carried out in the SEPA area, Credit Transfer (SCT) in compliance with the times described above, 48 hours; for bank transfers without IBAN (BBAN, BIC, SWIFT), higher time may be required on a case-by-case basis. In compliance with the above-described dynamics, a continuous and unrestricted level of service is guaranteed, verifying the adequacy of the client's needs in their use, substantially quality surveys and a periodic analysis of the control procedures adopted in order to eliminate inertia in the execution of payment transactions and where possible to reduce the time (competent body: super strategic vision); the reliability and availability of the service is also guaranteed through the controls performed by the administration of the institution as illustrated at the end of paragraph 6-3 and in the mechanisms above this point. The procedure of further confirmation requires the insertion of the security code received via text message (SMS) from the user of the web account. The security code remains valid for a few minutes and is always different.

Â

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Economic conditions applied In the monthly sales cost of financial services, the web account includes the stamp duty applied to the customer in the amount of Euro 1.81 for each report related to the web payment account, when the sum exceeds Euro 77.47 as established at Article 13, paragraph 2, of the Tariff, Part I, attached to the Presidential Decree n. 642 of 1972, of the Italy Member State; for payment accounts issued by payment institutions, no other stamp duty is required. There is no provision for the application of an interest rate for funds held on payment accounts (web account) for future transactions since the same funds do not constitute a deposit with repayment obligation; therefore the withholding tax of 26% sanctioned by article 44 of the decree law of 22 December 1986, n. 917 (of the Italy Member State) as amended by the legislative decree of 12 December 2003, n. 344 and by decree law of December 31, 2004, number 311, which on the contrary must apply to credit institutions and financial intermediaries in compliance with article 3 of the decree law n. 66 of 2014, letter b) of paragraph 7 (of the Italy Member State), for which the application of article 1825 of the civil code italian is configured, must not be applied by payment institutions (since it is not possible to configure article 1825 of the Italian civil code for accounts of payment disbursed by IDPs that differ from current accounts defined with article 1823 of the civil code italian and bank current accounts defined by article 1852 of the civil code italian).

Although the possibility of applying an active interest rate for IDPs and IMEs on the amounts collected from the public for payment transactions is precluded, the possibility of implementing remuneration policies for its customers aimed at competition between PSPs (payment service providers) Â

is

certainly

not

precluded;

considering

that

eventual 62

Â

remuneration may constitute both capital income such as in the case of issuance of crypto currencies with a rate of return (plusvalue) that cash bonuses (awards) of a liberal nature (linked to the crypto currency or financial services) and therefore in the first case subject to the withholding tax of the 26% as established by article 44 of the decree law of 22 December 1986, n. 917 and by article 3 of the decree law n. 66 of 2014, paragraph 1 (of the Italy Member State), while in the second case the 8% tax is charged to the customer and not to the institution.

The cost of the web account is a fixed monthly fee both for individuals and legal and does not include additional costs for payment transactions; from the web account it will be possible to charge and receive funds in electronic money considering that the open Payment Institute will provide only remote financial services: web account. Payment transactions may be canceled by the payer within 24 hours of placing the order and will not be executed before 48 hours (pursuant to Article 78 of Directive 2015/2366 / EU). The payment transaction can be credited to the user's account within 24 hours of receipt of the funds (credit notification by the payer's service provider) on the account of the institution, in which case the credit date corresponds to the date in which the institution took possession of the funds.

The methods for crediting the monthly cost of the web account are made automatically from the user's deposit funds at the beginning of each month and within 15 days of opening for the first month. In case of unavailability of funds the web account is suspended without further costs. The customer for the reactivation will only have to top up the account (transfer sufficient funds to cover the monthly cost of the web account), alternatively it remains suspended until the user communicates a request for withdrawal Â

63

from the contract stipulated in the manner indicated therein; (request to be forwarded to the e-mail legal address of the institute) (°).

I servizi saranno forniti in conformità alla direttiva 2007/64 / CE e successive modifiche apportate dalla direttiva europea (UE) 2015/2366 (articoli da 38 a 94).

Interbank network The RNI protocol is also an international standard adopted by European banks for the secure exchange of financial data. The outsourcing service includes the transmission infrastructure and therefore access to the national interbank and European network, so as to follow an illustration regarding only the implementation of own infrastructure for the provision of the service "web account", which that will be realized place later when starting the Institute activity.

The open institute will interface to the RNI, the transmission infrastructure of the Italian payment system, through an accredited Network provider, an RNI Service Provider. The national provider of access to the network that with its own telematic network, is a Network Service Provider of the National Interbank Network (RNI) on which the SITRAD (Interbancario System of Networks for Data Transmission) is based, the convention that allows the transmission for via data transmission and information flows connected with the execution of banking and financial transactions on an international scale. The provider's network, through the RNI, links the Data Processing Centers of the Supervisory Authority, of the banking institutions, of the Ente Poste, of consortia, of Application Centers, of

64

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Mobiliar Intermediary Companies (SIM), post-trading and international market operators.

Data transmission takes place through the Suite Messaging Services which manages the communication between the participants in the convention through messaging services in a B2B logic. The provider, provider, ensures the transport of interbank devices and information flows ensuring reliability of execution, security and confidentiality of data.

Through the RNI the open institute will exchange with the other intermediaries Banks, IDPs, IMEs, exchange inter-bank transactions in electronic with each other with the application centers and with the other European and world networks (SWIFT). The transport services that make up the Suite Messaging Services are: FTS-File Transfer, MSS-Message Switching, Trans-TRS, Fast & Lite-FLS, Web Service-WST. Through the network architecture of the RNI provider the Suite Messaging Services is able to simplify the integration of user applications, relieving them from the need to manage the complexity of transport processes (retry, status management, monitoring, etc). In fact, the communication of the various messaging services with the user applications connected to a domain takes place thanks to the use of the Gateway of the RNI provider (EAS / FAS / Smart Integrator Standard) installed at the public interest institutions, then the open IDP Institute. The Messaging Services Suite adopted by the Institute consists of the access service to user domains, with which the RNI provider allows its customers to access through a single network infrastructure managed to different communities (RNI, T2S, EBA STEP2 , Instant Payment, ...); the network of the provider on which it is based enjoys all the advantages of a "managed end-to-end network". A managed point-to-point network where all the components are provided, installed Â

65

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and managed by the provider means first of all minimizing the complexity of the access infrastructure to the advantage of a greater focus on business objectives. Messaging Services will be independent by design of transported contents, and can be used for the transport of all international standard protocols such as RNI and ISO. Ultimately it is a solution that has the following advantages: peer-to-peer infrastructure to ensure data security and confidentiality, reduction of data transfer costs thanks to the compression of native data, notarization and time stamp for a formal transmission control data, guaranteed data delivery, the gateways provided by the provider support multiple operating systems (IBM Mainframe, Linux, AIX, HP UNIX), a single point of contact for all requests for assistance to the customers of the RNI provider., complete with management and service monitoring for 24 hours a day, 365 days a year.

Some of the main strengths of the Messaging Services Suite are underlined: the automated management of the Disaster Recovery procedures through the backup nodes the compression integrated in the network infrastructure in order to process the least possible number of bytes,

the

availability

more

interfaces

for

different

application

environments. The solution is independent of the type of hardware and software adopted, thus safeguarding its investments and technological independence, as well as providing access to the main interbank auxiliary services such as the Supervisory Authority's Central Unit and the Computerized Fraud Prevention System Payment cards.

The provider of access to the RNI network will provide the Institute with access to the Payment Node and the connection to the "Payment NodeSPC" platform compliant with the AgID specifications. The service inherits all the features of the RNI provider network, in particular it uses the Web Â

66

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Service Transport-WST, to which it adds functions to transparently exchange SOAP messages with the "Payment Node-SPC". In order to ensure compliance with AgID specifications, the service provides counterparty identification, data transmission encryption and message tracking.

Complaints

management,

reports,

incident

management,

ADR

procedures, outsourcing controls management The outsourcing system, such as the web channel for access to the service provided (web account), allows the forwarding of electronic complaints that will be handled by the institute and the competent body according to the type of request sent by the customer. Complaints and reports may be forwarded through the references available from the website of the institute or from the web account management platform; the procedures for processing complaints include the reception phase in which the urgency is assessed with priority for security issues that are processed promptly at a few hours, instead the reports and complaints of an operating nature are processed within 24 hours and within seven days all the others. Any complaints or serious security and operational incidents are notified without delay to the Supervisory Authority via certified digital communication; if the incident affects or could affect the financial interests of its payment service users, the institution shall inform its users of the incident without delay and of all available measures taken to mitigate its adverse effects. It must be considered that the use of the dispositive password known only to the user and generated automatically by the system at his request does not allow improper use of the financial system of the Institute unless theft, theft that would not produce the effects hoped Â

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by the ill-intentioned in how much any attempt of operation is tried by the institute (hypothesized at the moment unaware of the theft) only after further confirmation by the user through the confirmation email that receives for each use of the dispositive password, to add that the latter receives a SMS notification when access to the web account occurs, therefore the damages in all the hypothetical dynamics of security breaches and accesses are minimal and null in application of the intervention times of the institute in the area of reports on accesses and violations (suspension of access, change of credentials, verification of data of the parties involved and every other action it became necessary for the specific happened). The administrative systems of the institute and for the management of financial services (web account) have the same level of protection to which is added an ad hoc network of connection with the infrastructure considered immune from any type of violation, in addition the theft of credentials does not it would be enough to access and then you get to an optics in which the institution should be stolen everything that according to the illustrations in paragraph 6-6 still would not be able to access: they should be combined, devices to access the protected network, password access to the protected network , password access to managerial systems, passwords to operate, constituting as a whole a security mechanism that can only be used by senior management. The most serious operational incidents that can be hypothesized have a very limited existence domain both in number and extent of the damage with a minimal impact on the Institute and none on the users of the payment services provided, as deducible from the entire reading of this project (activity program, attachment B of the application for the Public Authority): the proportionality principle distributes the company functions to the Management Body, the strategic Supervisory body and the control body, allowing a continuous dialogue through a telematic communication system, Â

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exchange of electronic documents by means of dedicated documents and periodic

meetings,

computerized

information

systems

outsourced

(outsourcing provider), control of automatic data when present in the directories of the web structure for the provision of services and information system outsourced, double continuous control of the administration, both for the correct execution of the operations of payment that for the controls provided for by Directive 849/2015/EU, centralized management of company functions by means of software with remote management,

automatic

data

collection

of

each

operation

and

communication performed during payment transactions, wide availability of information provided by the supplier 'Outsourcing. Furthermore, the institute will join the Financial Banking Arbitrator (application of article 102 of the 2015/2366/EU directive for Italy), as an alternative dispute resolution procedure (ADR) not exceeding € 100,000.00 , for the member state in which the institute is based, Italy. There are no limits for matters relating to the ascertainment of rights, obligations and powers. For disputes over € 100,000.00 and in accordance with the Regulation (EU) Number 12152012, Chapter II, Section 4, Articles 17 to 19 and in application of Article 19, is chosen as the place of jurisdiction, the forum of Salerno, Italy. The cumulation of checks indicated in the higher points of this paragraph and at the end of paragraph 3 constitute a mechanism for controlling the outsourced web account service, including IT systems, and information services (same outsourcing provider) which eliminates the material possibilities of to jeopardize the quality of internal control of the payment institution and the ability of the competent authorities to monitor and document that the payment institution fulfills all the obligations set out in Directive (UE) 2015/2366; furthermore, they ensure that outsourcing does not result in the delegation of responsibility by senior management and that the relationship and obligations of the payment institution towards its

69

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payment service users under the same directive are not altered, that compliance with the conditions that the payment institution must satisfy in order to be authorized and to retain such authorization in accordance with this title is not jeopardized, and that none of the other conditions to which the authorization of the payment institution was subjected has been deleted or modified. Finally, the daily control of the log file for access to the managerial area of outsourced services allows for a direct and daily control on the verification of the level of security guaranteed by the outsourcing provider: security of hardware equipment and IT structure; an effective strategy of regulatory compliance and risk management is guaranteed, even with recourse to adequate insurance coverage of operational risk by the supplier.

6 - 6 Computer security, software and hardware systems The administrative department (as administrative body of the Payment Institute) having technical skills with reference to the Group's IT network carried out simulations of the operation of a section of the network (work station - server - hosting) aimed at the security of data relating to services financial instruments simulating volumes of data to be managed and archived generic. With the project goal of reaching an operating level capable of filling also a natural disaster situation, system errors, and possible data loss, the new headquarters of the Hosting Industry, the current supplier of the corporate Group to which it belongs, is chosen as the location with which it has been established a relationship of trust of almost two decades, locations free from flood risks, and most of natural disaster, beyond standards and certifications of control and security of Â

70

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data that demonstrate for the supplier a level well beyond the highest safety

standards

both

in

the

internal

(European)

and

external

(international) markets. These are all-inclusive locations with high quality standards, both technical, network, environment control, continuity, physical access, maintenance, layout, innovation, technical features for physical and remote security at every level.

In compliance with the report on the synthetic activity program approved by resolution of 21 June 2017 and subsequently supplemented by the Administrator for the authorization request to the Supervisory Authority for the Member State of the European Union Italy, the Bank of Italy will be adopted the double solution, outsourcing of financial services, own IT infrastructure. With reference to the design choice adopted, sufficient to guarantee the parameters of environmental control and continuity of electricity in the location of the infrastructure and outsourcing (market analysis in progress for the choice of the potential supplier for outsourcing), the tests focused on data backup solutions.

Given that from the first tests performed the encrypted backup provided interruptions in the operation of the equipment, variable discontinuity with both the complexity of the encryption and the frequency of the backup, is therefore excluded for an unencrypted backup solution, (unencrypted backup files ), with the possibility of reaching continuous backup frequencies. It should be noted that continuity will be an adoptable solution only after the last tests that can be carried out to the completed and operational infrastructure (therefore after the authorization, object of the report). The problems to be solved are of two levels: data security (unencrypted backup files), transmission of backups between two distinct and separate locations. The first level is fulfilled through the use of VPN connections, installed upstream of the firewall structure that the different locations of the hosting provider are equipped with (housing services, Â

71

locations, which in turn are located downstream of their redundant firewall complex algorithms with twin SonikWall twin firewalls (complex devices supplied for telecommunications operators), a solution that guarantees data protection during transmission (the upstream firewall structure is equipped with a device for the establishment of sophisticated encrypted data transmission links also known as VPN professional).

The second level of problem is solved by the installation of a second VPN with access control (user, complex password), between the backup server and the access work station (for the administrative body); in this way three levels of security, access to the work station, access to the VPN and access to the server must be overcome. VPNs created through the use of two sophisticated devices provided for telecommunications operators in a remote location at the two locations (Payment Institute infrastructure infrastructure and Backup infrastructure) will have encrypted RSA-Rijndael backup (1024 bits) with double public key RSA (asymmetric) for cryptography and with security control Passphrase (password for decryption); read note (°). In this way, in case of problems with the work station, it will be possible to install the VPN in any private work station to restore access to the backup server.

_________________________________________________________________________

(°) In cryptography, the acronym RSA indicates an asymmetric cryptographic algorithm, invented in 1977 by Ronald

Rivest, Adi Shamir and Leonard Adleman, which can be used to encrypt or sign information. In 1976 Whitfield Diffie and Martin Hellman, American cryptologists, were the first to publish a system based on the creation of an "asymmetric" cipher composed of "public keys"; although a few years earlier, James H. Ellis, Clifford Cocks, and Malcolm J. Williamson of the English secret service had already thought of it, the news was covered by military secrecy and was only disclosed in 1997. The cryptography system is based on existence of two distinct keys, which are used to encrypt and decrypt. If the first key is used for encryption, the latter must necessarily be used for decryption and vice versa. The fundamental question is that, although the two keys are dependent on each other, it is not possible to go back from one to the other, so that even if one of the two keys is known, one can not go back to the other, ensuring in this way the integrity of

72

cryptography. To create a public cryptographic system with an asymmetric cipher it is important that a user independently creates both keys, called "direct" and "inverse", and only publishes one. In this way we create a sort of "telephone directory" available to all users, which groups all the direct keys, while the inverse ones will be kept secret by the users who created them and used by them only when they receive an encrypted message with the respective public key of the "list" by a certain sender, thus obtaining the necessary conditions for the security of the system.

Backups of VPN connections and all administrative passwords will be stored in a device separate from the work stations and stored in a safe; the RSA decryption key will be stored on a second device separate from the work stations and stored in the second safe; read note (°).

_________________________________________________________________________

(°) The reverse key is provided by the administrative body, the direct key is installed on the backup server used by the backup infrastructure to encrypt backup files. The backup system used is the differential that occurs after the first full backup in sync with the creation of each new data.

The result and business continuity even in the extreme case of natural disaster of the operational headquarters of the payment institution coinciding with the registered office (for the first years of activity) because it will be enough to have the two password storage devices and RSA encryption key in order to restore within an hour sufficient operational capacity from reserved positions.

The backup file allows a rapid recovery of data in a short time and, in the event of disasters, the move to outsourcing services thus allowing customers of the opening Payment Institute to be able to use financial services even in critical conditions. The security plan adopted in the extreme case of a natural disaster involves a time for the restoration of financial services in emergency mode, not exceeding one day, (about half a day). The solution is optimized with respect to the cost and the results

73

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obtainable, through an emergency link provided to customers within a few hours (in extreme cases of natural disaster) having full service contract operations with slight changes to the simple web interface of use . There are two domains with allocation infrastructure located in different places (different regions). For the web emergency access the user will use the same security certificate installed on the computer during the activation of the services and the same access credentials; after login it will have to reset the passwords (both access and use) to be able to operate; the operation will not be repeatable and must be performed at the first access, otherwise the system will block the credentials automatically requesting the intervention of the administrative body for the restoration. Obviously the transition from the standard platform to the outsourced emergency platform will take place with the assistance of the Payment Institute.

The management of the server infrastructure located at the hosting provider will have the same access system as the backup server infrastructure, except for the two additional firewalls upstream of the firewall structure of the same provider, as they would be unnecessarily redundant due to the fact that the servers possess standard access Web sites. The administrative body can manage the administrative services of the structure through remote access from reserved work stations with three levels of security; the passwords of the first (work station) and third level

(server)

will

be

updated

periodically.

The

adopted

server

incorporates a device for self-powered satellite localization and a device for tampering, moreover, after completion of work, all access from the front panel is deactivated and can only be used with remote access. The server is placed in the hall of the supplier with a high level of security and interfaces with devices via the internal network to be accessible and therefore outside the structure of the same provider will not work in any way, can not be hacked remotely and can not be manipulated; in addition, Â

74

Â

the self-powered satellite locator allows continuous detection of the server and any movement. Complementing the security is the encryption of data system that without the appropriate remote access information is only encrypted data that can not be used and inaccessible (data saved in backup in another structure for the business continuity of the Htn Institute to which is added the outsourcing of the web account).

The control accesses for payment transactions available for organizational resources, in accordance with the legislative novella for which one of the many updating activities carried out by the administrative body in the appendix is reported, have ordinary procedures with semi-complex users and passwords because they will not allow any modification or operations but only the reading of data related to payment transactions (identification data, unique identification number, regularity, potential attempts to access fraudulent system, complaints and reports of users) and must inform the administrative body for each type of potential intervention becomes necessary. The password of the control web account will be updated by the administration for each location with frequency from one day to three days to be established in operating conditions.

Evaluations were made for the choice of the best solution of the communication system between the administrative body and the resources of the organizational structure; the best result is potentially provided by a system of communication to written messages between the work stations of the organizational resources and the work stations of the administrative body that, together with the telephone system of the organizational structure, constitutes the information exchange system, recording in chronological order and identification of each written communication. The information will be exchanged via a message system (written and recorded) using the telephone system for information Â

75

Â

exchange of lesser importance. The software system of the IT infrastructure will include data storage and information functions with different levels of storage (administrative body, organizational resources) and different groups for the composition of information and archived data constituting a valuable resource for the AUDIT EDP controls.

The institute carried out the tests focusing on the evaluation of the management capacity of the IT structure that, together with the organizational resources, will be able to provide for the functions of line controls, the operational capacity in the performance of the control functions and the provision of services avoiding direct participation of the administrative body in the provision of services.

The server software system adopted for the provision of the chosen payment services (web payment account) is accessible to the user upon the installation of the certificate on the computer from which he / she accesses access credentials (user and password) received in the manner indicated in the paragraphs previous one. The user must set a new password on first access and must define a second password for use; the guidelines issued pursuant to Articles 96 and 97 of Directive 2015/2366 will be applied. All reports including any complaints are executable from the website in the contact section. All communications addressed to the institute by the users can be read by the operational and administrative resources, without the possibility of eliminating both incoming and outgoing mail, a function that is possible only for the administrative body, excluding the legal mail pec of the institute that it is read only by the Group's administrative department.

The management and administrative system of the IT infrastructure chosen for the provision of payment services allows the organizational Â

76

Â

resources to carry out checks on payment transactions of payment service users, carrying out security oversight activities and checking any anomalies, attempts fraudulent access that will be communicated to the administrative body for possible interventions. They perform the functions necessary to complete payment orders made by users after access in the manner described above and after confirmation of the operation by entering the second password that allows transactions to be carried out from the web payment account and further confirmation through the e-mail received in the second e-mail address indicated by the user confirming the start of the payment transaction; the order is taken into office by the Institute only after the payer has completed the security procedures indicated in the previous paragraph (with reference to the opening of the confirmation link) and has a 24-hour availability for the cancellation due to data changes, error correction. After 24 hours and completed checks on the regularity of the operation, correctness of data and other provisions of the regulatory framework for financial services (controls for the prevention of money laundering, verification of beneficiary data, unique identification number, the accompanying data transfers of funds), the transfer of funds is forwarded to the beneficiary institution (or bank) within the next 24 hours (total time for the execution of payment transactions as a system configuration parameter is 48 hours). The same checks are carried out by the same organizational resources for the transfers of funds received from the users of the payment services of the institution. Through the internal information system the organizational resources communicate to the administrative body any anomaly, that intervention required as a result of the improvement procedures and checks of the payment orders for transfer funds received or sent by the users.

Â

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Fonts for research: Treaty on the functioning of the european union | REGULATION (EU) No 648/2012| REGULATION (EU) No 575/2013 | Regulation 1095/2010/EU, European Supervisory Authority |REGULATION (EU) 1092/2010, ESRB | Directive 2006/48/EC, credit institutions | REGULATION (UE) 1093/2010, European Banking Authority (ABE) | REGULATION (EC) No 1606/2002, adoption international accounting | REGULATION (EU) 1094/2010, EU Insurance Occupational Pensions (EIOPA) | Regulation 16062002-EC,application of international accounting standards.pdf |REGULATION (EC) No 1569/2007, mechanism equivalence accounting standards | Directive 2006/49/CE, capital adequacy | Directive 2013/36/EU, repealing 2006/48 and 2006/49 | Proposal to amend Directive 2013/36/EU | Regulation (EU) No 1093/2010 | Directive 2015/2366/EU, Institute of payment | Regulation EC 1060/2009 | DIRECTIVE (EU) 2015/849,EN | Article 2359 Civil code Italy | Regulation (EU) No 260/2012, technical and business requirements for credit transfers and direct debits in eur | Direttiva 2009/110/EC, electronic money | Article 2477 Civil code Italy | DIRECTIVE 2013-34-EU,amending direective 2006/43/EC | Directive 2006/43/EC | Regulation (EU) 537/2014 | Article 1852 Civil code, Italy| Article 1834 Civil code Italy | Article 1842 Civil code Italy | Article 1813 Civil code Italy | Article 1825 Civil code Italy | Regulation (EU) 680/2014 |

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Publication list

H Research Edition English: publication 03 magazine number 2019-20

SOLID, LIQUID AND GASEOUS FUELS Legislation on quality and harmful emissions

publication 2019-20 03

1- Introductione 2- Fuels 3- Calculation of the combustion air 4- Calculation of calorific power 5- Experimental determination of the calorific value 6- Yield of a engine system

Author: engineer Vito Gnazzo

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Legislation on quality and harmful emissions.

Solid, liquid and gaseous fuels.

With reference to liquid, gaseous and solid fuels in publication 201 20.03, we have carried out research on European legislation concerning the quality of fuels and the emission of harmful pollutants into the air.

We have been interested in the technical analysis of a fuel by carrying out research on the relevant quantities with which they are characterized: calorific value, combustion temperature, power on temperature, ignition temperature (spontaneous combustion), combustion air, viscosity, calorific value; we carried out studies on the theoretical method for the determination of the calorific value and of the combustion air and of the efficiency of an engine plant, with interest also to some experimental methods.

1 – INTRODUCTION With the aim of improving the quality of the atmosphere with regard to sulfur dioxide and other polluting gases, the Community has had to take steps to progressively reduce the sulfur content of the diesel used for the propulsion of vehicles, including aircraft and ships and diesel for heating, industry and ships from 1975 with Directive 75/716/EEC which constitutes a first step towards reducing the level of sulfur of liquid fuels and concerns only gas oils; with this directive two types of gas oils are defined, type A and type B, in it is given a definition of certain types of fuels containing sulfur with the intention to reduce its content. With Article 1 of the same directive in paragraph 1,diesel oil is defined any petroleum product which, due to its distillation limits, is part of the average distillates intended for use as fuels or fuels and of which at least 85% by volume, including distillation losses, distills at 350 ° C; (are also included, in the same definition of gas oils, any petroleum product as defined in subheading 27.10 C I of the Common Customs Tariff, 1 January 1974 edition). In the same article, with diesel type A are defined any low

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sulfur diesel oil whose use is not subject to restrictions in the Member States; diesel oil Type B any diesel oil intended for use: in areas where the levels of air pollution due to sulfur dioxide, measured at ground level, are sufficiently low, or in areas where the participation of diesel fuel to air pollution due to sulfur dioxide is not significant. The same Article in paragraph 2 excludes the applicability of the definition in paragraph 1 for gas oils used in power stations, used for ships used for maritime navigation, contained in the fuel tanks of vessels used for inland waterways or motor vehicles at the time transition from one area to another or from a border between a third State and a Member State. The limits of sulfur content for gas oils are defined in Article 2 (1) and Member States shall take the necessary measures to ensure that: (a) Type A gas oils can be placed on the internal market of the Community only if the content of sulfur compounds, expressed as sulfur, (which they contain) is not more than 0,5% by weight, with effect from 1 October 1976, and 0,3% by weight, with effect from 1 October 1980; (b) Type B gas oils may be placed on the internal market of the Community only if the sulfur compounds content, expressed as sulfur, which they contain, does not exceed 0.8% by weight, with effect from 1 October 1976 and at 0,5% by weight from 1 October 1980. Article 5 states that Member States shall determine the areas in which the use of type B diesel is permitted. They shall inform the other Member States and the Commission on their decisions, as well as on the criteria followed for their selection.

Directive 75/716/EEC is first amended by Directive 87/219/EEC and then replaced by Directive 93/12/EEC. With the Directive 87/219/EEC various modifications are made including the reduction of the sulfur content possible in diesel oils. Further reductions are made by Directive 93/12/EEC; this last directive is first amended by Directive 98/70/EC and definitively repealed by Directive 2009/30/EC currently in force, the same directive amending Directive 98/70/EC on the quality of petrol and diesel fuels.

With the directive 93/12/CEE the European Commission in order to reach the levels of emission of particles fixed in the specific community directives (for example the directive 2008/50/CE, of 21 May 2008, currently in force and relative to the quality of the ambient air and for cleaner air in Europe under investigation in forthcoming research), Member States shall prohibit the marketing in the Community of diesel fuels with sulfur compounds, expressed as sulfur (hereinafter referred to assulfur content), exceeds: - 0,2% by weight from 1 October 1994, - 0,05% by weight from 1 October 1996.

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Member States shall ensure the progressive availability of diesel fuels referred to above (paragraph 1 (1), Article 2) with a maximum sulfur content of 0.05% by weight. Member States shall prohibit the marketing in the Community of other gas oils, or those destined for different uses, from those referred to above (paragraph 1, Article 2 of Directive 93/12/EEC), with the exception of kerosene for aircraft, the sulfur content of which is exceeds 0.2% by weight from 1 October 1994. With the same directive the European Commission has laid down the obligation for Member States to take the necessary measures to carry out random checks on the sulfur content of gas oil on the market. The reference method adopted for the determination of the sulfur content of the commercialized gas oils is that defined by the ISO 8754 method. The statistical interpretation of the results of the controls in order to establish the sulfur content of the commercial gas oils must be carried out according to the ISO standard 4259.

With the Directive 98/70/EEC the European Commission intends to reduce the polluting emissions produced by the exhaust gases of motor vehicles and with the intention to reduce the disparities between the legislative or administrative provisions of the Member States on the specifications of fuels traditional and alternative used in vehicles with positive-ignition engines and compression-ignition engines; it intends to reduce the obstacles between trade in the Community which may have a direct impact on the establishment and functioning of the internal market, as well as on the international competitiveness of the European automobile and refining industries.

Legislative provisions are dictated both for imitating polluting emissions and for defining appropriate and harmonized measures for the purpose, taking into consideration that primary atmospheric pollutants, such as nitrogen oxides, unburnt hydrocarbons, particulate matter, carbon monoxide, benzene and other harmful exhaust gases contributing to the formation of secondary pollutants such as ozone are contained in relevant quantities in exhaust gases and evaporative emissions from motor vehicles, thus creating a substantial risk to health, directly or indirectly. of man and the environment.

With Directive 98/70/EEC and pursuant to Article 4 of Directive 94/12/EC of the European Parliament and of the Council, the Commission has defined a new approach for emission reduction policies, implemented since the year 2000, he also examined, among other things, the extent to which the improvement in the quality of petrol, diesel and other fuels would reduce atmospheric pollution. Directive 94/12/EC on the measures to be taken against air pollution by emissions from motor vehicles amends Directive 70/220/EEC with which the Commission establishes the first provisions concerning the approval of motor vehicles with positive ignition with reference

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to atmospheric pollution from exhaust gases. With Directive 94/12/EC in Article 4, provisions are laid down on Community measures against air pollution caused by motor vehicles. The Commission establishes that the measures will be designed in such a way that their effects meet the Community requirements for air quality criteria and the objectives associated with them; undertakes to carry out an assessment of the cost / effectiveness aspects of each measure taking into account, inter alia, the contributions that could be made to improve air quality: traffic management, for example regarding a breakdown adequate environmental costs, - the promotion of urban public transport - new propulsion technologies (eg electric traction), the use of alternative fuels (eg biofuels), - the measures will be proportionate and reasonable with respect to the objectives pursued. The Commission's proposals take into account the above methodology and aim at the substantial reduction of pollutant emissions with regard to vehicles, in accordance with the same Directive 94/12/EC, and include in particular the following elements: requirements of this Directive (Articles 1 to 3) on the basis of the evaluation of the potential of the traditional engine and post-combustion technology, of possible improvements to the test procedure, for example, cold start, starting at low or winter temperatures, duration (for example in the conformity tests), steam emission; of the type approval measures involving stricter inspection and maintenance requirements, including, for example, onboard diagnostic systems. The improvements, I intend to refer to the aforementioned directive, are also based on the assessment of the possibility of checking the conformity of vehicles in circulation, the possible need for: i) specific limits for HC and NOx as well as a cumulative limit value and ii) measures for to include pollutants that are not yet regulated. The additional element in the Commission's proposals for the measures to be taken by Directive 94/12/EEC against atmospheric pollution from motor vehicle exhaust is the Measures complementary techniques in the context of specific directives, including: improvements to the fuel quality of emissions of hazardous substances (in particular benzene) from vehicles, stricter requirements for the inspection and maintenance program. Limit values reduced rates, which are the subject of Directive 94/12/EC, have not been applied before 1 January 2000 for new type approvals. The Council has introduced tax incentives by defining concession conditions based on these limit values.

Directive 70/220/EEC and Directive 94/12/EC are subsequently repealed by Regulation (EC) 715/2007 as amended in 2008 by Regulation 692/2008/EC; the aforementioned standards have been studied in the publication 201819.06 (H Research magazine number 2018-19, publication date: June 2018).

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Directive 98/70/EEC establishes, for reasons of health protection and the environment, the technical specifications for fuels to be used in vehicles with positive-ignition engines and compression-ignition engines (diesel); defines ecological specifications for petrol and diesel fuels, the said legislative provisions, considering that the use of oxygen and a substantial reduction of aromatics, olefin, benzene and sulfur may allow fuels of better quality from the point of view of quality air. For the purposes of this Directive, the following definitions apply 1) petrol: volatile mineral oils intended for the operation of internal combustion and spark ignition engines, used for the propulsion of vehicles and included in CN codes 2710 00 27, 2710 00 29, 2710 00 32, 2710 00 34 and 2710 00 36; 2)diesel fuel: the gas oils specified in CN code 2710 00 66 and used for selfpropelled vehicles (motor vehicles with positive or spontaneous ignition, by compression).

The Annexes I, II, III and IV of this Directive define the ecological specifications of fuels available on the market both for motor vehicles with positive ignition (petrol) and vehicles with compression ignition (diesel) engines; both Directive 98/70/EEC and the Annexes are amended by Directive 2009/30/EC, Directive 2014/77/EU and Directive 2015/1513/EU.

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2 - COMBUSTIBLE The main factor characterizing the fuels, liquids, solids and gasses is the calorific value: the quantity of heat that develops from the combustion of one kilogram of fuel; in the international system measured in kJ (kiloJoule) or in MJ (megaJoule). The kcal (kilocaloria) is very common, where 1 kcal = 4.187 kJ.

Solid fuels The most used solid fuel for the machines is coal, mainly made up of carbon, in a percentage that varies according to quality and from other substances: hydrogen, oxygen, sulfur (aromatic), and small quantities of mineral substances (silica, alumina, iron oxide, etc.) which constitute the solid residue of combustion (ash). Coals (solid fuels) are distinguished in anthracite, litantrace, lignite and peat; the distinction is linked to the age of coal formation: for example the age of the tree trunk from which the coals are produced. The peat-type carbons are of more recent epoch, the anthracite type coals of the most remote epoch. The percentage of carbon, the main constituent, therefore decreases from the highest values in anthracite (over 90% because in it the process of carbonization has been almost complete) to the lowest in peat (50% - 60%). The higher the percentage of carbon, the higher the amount of heat developed in combustion.

Below are the data collected regarding the elemental compositions and higher calorific powers Hs of the coals Carbon % Peat

50 - 60

Hydrogen % Oxygen % 4,5 – 5,8

28 - 48

Nitrogen %

Hs

0,75 - 3

1260016700

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Lignite

60 - 75

5

20 - 35

0,75 - 2

1510025100

Litanthrace

75 - 90

4,5 – 5,5

5 - 15

0,75 – 1,8

2930036800

Anthracite

90 - 95

2,5

3

0,50 - 1

3480035600

There are other practical classifications of coals, for example based on the percentage of volatile hydrocarbons present, on long or short flame (organic compounds of carbon and hydrogen), or on the percentage of bituminous hydrocarbons on which the agglomerating power depends (fats, seeds-fats), epoch of the main component (timber) or from the place of provenance. The most commonly used coals for the boilers are the short flame half-fat litantrace with a sufficiently homogeneous agglomerate which, therefore, do not tend to crumble like the thin ones and eliminate the inconvenience of a flame that is too long, such as cooling due to the contact with the pipes; (at the same calorific value the long flame distributes the heat in a larger area, reducing the heat flux per unit of surface and therefore the temperature reached). Even if the increase in the cost of oil has favored the use of coal, liquid fuel is still the most used.

Liquid fuels Oil is a liquid composed mainly of water, oils and fats (hydrocarbons) and other numerous substances; the composition is quite different in relation to the quality and place of origin (Arab countries, United States, Canada, Mexico, and others).

On average it is composed of 80% to 90% of C carbon, of 10% to 15% of H2 hydrogen, of 20% to 5% of O2 oxygen, of 0.10% to 1.6% of S sulfur, 0.10% to

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1.6% from N2 nitrogen, from 0.10% to 1% from water and 0.10% from ash. The oil coming from the producing countries is subjected to refining with a fractional distillation process through which the substances of different qualities are separated. The distillation takes place in special columns, or towers, where the crude oil is brought after a preheating to 400 °C, in the lower part of the tower the heavy oils are extracted that distill at a temperature between 300 °C and 400 °C, and residues (bitumen). From this phase we obtain the heavy naphtha, (fuel oil) of density ρ = 800-900 kg/m3 used in steam generators and in big two and four stroke diesel engines, while residues, bitumen, in lubricants. At higher heights of the distillation towers, medium oils are extracted, distilling between about 200 °C and about 300 °C, used for the production of gas oils, kerosene, used in fast diesel engines and gas turbines. At the top of the towers are finally taken light oils that distill at temperatures of less than 200 °C used for the production of gasoline that have the characteristic of being volatile and then form a highly flammable mixture with the air. Gasolines are widely used in automotive engines operating according to the Otto cycle, also referred to as carbureted engines, or with switch on commanded; the gasolines are also subjected to other processes such as reforming, a process used to increase the octane number of a hydrocarbon mixture; the octane number is an index of the detonation resistance (or anti-knock characteristic) of petrol or other fuels.

The petrol normally on the market for cars has an octane number of about 95, measured with the Research (RON) method in which the detonating power is tested with the engine in cold conditions, or it is about 85 if measured with the Motor method (MON ), a more severe test, where the test engine is the same as the RON system, but is tested under load, with the engine having a higher rotation speed, moreover the ignition advance is higher than the RON method , to test the power detonating (antiknock power). Both tests are based on the use of a four-stroke engine with a variable compression ratio; from the variation of

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this last one brings the gas in measurement to detonation. Subsequently the test is repeated without varying the compression ratio and using a sample mixture in which it is possible to vary the known octane number. When the detonation is reached, the octane number of the petrol is defined as the octane number of the sample mixture detonated by varying the known octane number. By definition we attribute a number of octane nil to n-heptane, any alkane: organic compounds consisting only of carbon and hydrogen, for this reason belonging to the largest class of hydrocarbons having crude formula CnH(2n + 2) as in case of n-heptane with crude formula C7H16 or to any mixture of several compounds corresponding to this formula (structural isomers) such as the linear isomer, more properly called n-heptane, which at room temperature is presented as a colorless liquid from the pungent odor, is a very flammable compound, irritating to the skin, dangerous to the environment, harmful. It is attributed an octane number of 100 to the isothane, a traditional name generally used to indicate 2,2,4trimethylpentane, a branched aliphatic hydrocarbon belonging to the series of alkanes. At room temperature it is a colorless liquid with a typical smell of petrol, in which it is present, it is also moderately volatile and very flammable; it is used as a solvent and as a reference hydrocarbon for the measurement of the octane number, because from studies carried out on the engines it appears that highly branched hydrocarbons have a much lower pre-detonation (or head beating) than linear aliphatic hydrocarbons.

A gas having octane number 95 has the same resistance to detonation as a 95: 5 mixture of isooctane and n-heptane.

The "normal" car petrol (no longer on the market in Italy) has an octane number of about 84 - 86, while the "super" petrol (no longer on the market in Europe) has a higher octane number, equal to about 98 - 100 (after reduced to 97).

Currently several oil companies also offer fuels with octane number 98 - 101, considering that the greater the octane number, the higher the "no-detonating power", fuel quality that reduces the risk of detonation of the bootable gasoline

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for the simple compression caused by the piston with the possibility of achieving a higher compression ratio.

The collected data indicate that in the liquid fuels derived from oil the lower calorific value assumes values ranging between 41.870 - 42.000 kJ/kg (10.000 10.300 kcal/kp). Relevant quantities for liquid fuels are also the flammability temperature, the temperature that must reach a liquid fuel so that the emitted vapors form with the air a flammable mixture in the presence of trigger. The value of the flammability temperature is very important also for safety reasons; it is low in gasolines, 20 °C, while it grows considerably in gas oils, in naphtha: 70 - 140 °C. From the above values it is clear that gasolines are particularly suitable for forming mixtures with the air and for this reason they are mainly used in to Otto cycle engines (controlled ignition) but they are also dangerous for the easy formation of explosive mixtures. The naphtha and the gas oils to form a mixture with the air must be preheated, which is why they are mainly used in compression-ignition engines and are considered to be less dangerous than gasoline. Another characteristic that characterizes liquid fuels is the ignition temperature defined as the temperature at which the liquid ignites in contact with the flame and with an adequate presence of air; this is a temperature slightly above the flammable temperature. Finally, the viscosity of the liquid fuels is defined as the quantity that characterizes the resistance to sliding through the pipes, holes; it is determined with special apparatuses called viscometers, based on the measurement of the time necessary for the passage through a predefined orifice of the fluid under test and of another liquid compared, both at a certain temperature. There are different types of viscometers including that of Redwood, Saybolt and Engler. In this last one normally flows through a capillary (the orifice) by gravity 200 ml of oil and an equal quantity of distilled water at a temperature of 40 °C; the system is equipped with thermal insulation with the outside and under the indicated conditions a common oil normally takes 600

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seconds to drain while the distilled water takes 60 seconds thus allowing to define the ratio (600/60) = 10, said viscosity of the oil, measured in Englar and indicated as follows: 10 °E to 40 °C. The instrument standardized according to the ISO DIN standards consists of a small-sized brass vessel, immersed in a thermostatic tank, provided with a calibrated hole (orifice) placed at the bottom center. The viscosity decreases with the increase in temperature and it is therefore common for the manufacturers to equip the machines with electric resistors to heat the fuel (especially heavy naphtha) before entering the pipe and the pulverizers (for example injectors in the combustion chamber) or in the injection line that feed the engine systems.

The size defined as the ignition temperature is also important: the temperature at which a mixture of fuel and comburent (for example gasoline and air) must be brought so that the combustion reaction triggered at one point can propagate throughout the mass of the mixture. Obviously even at slightly lower temperatures it is possible that the combustion reaction triggered at one point propagates throughout the comburent fuel mixture. It is useful to define the activation energy Ep of the combustion according to the distance between the molecules, called the reaction coordinate:

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When the reacting molecules of the mixture come into contact with each other, they collide, the kinetic energy is transformed into potential energy; when the molecules are sufficiently distant from each other they do not react and are at a certain energetic level indicated in the figure above with "reagents". In order for the combustion reaction to occur, an activated complex must be formed which splits due to combustion in the products; an event that requires a certain amount of kinetic energy to the reacting molecules indicated by Ea in the figure above and said activation energy. From the analysis of the statistical distribution of the molecules speed shown in the figure below it is possible to observe that with

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the increase in temperature there is an increasing number of molecules with a speed equal to or higher than the V0 speed necessary for creating the activated complex and then starting the combustion by propagating throughout the mass of the combustible combustive mixture. Since the kinetic energy is transformed into potential energy in the collision, and being the first increasing with the speed of the molecules, there is a velocity V0 so that the transformation into potential energy is sufficient to trigger the activated complex. The number of molecules influences the activation because if the energy produced in the collision is low, even if from reacting molecules with a speed equal to or greater than the speed V0, it is dispersed not being sufficient to trigger the combustion.

When the number of N molecules is sufficiently high such that the energy produced exceeds the potential energy dispersed, during combustion of the reacting molecules, the combustion which is propagated throughout the comburent combustible mixture is triggered. Since the temperature determines the above phenomenon, once the temperature T3 is exceeded, the fuel in contact with the air triggers spontaneous combustion without the need for trigger (self-ignition). The temperature value T3 is defined as ignition temperature which assumes the following values: for coke 500 째C, for 340 째C heavy mineral oils, for 250 째C petrol, for 230 째C diesel oil.

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Gaseous fuels The most widely used gases are natural gas, which is mainly made up of methane (obtained from technological processes of compressing air in combination with other substances, from which mainly carbon, hydrogen and nitrogen derive from the compressed air forming the new element: gaseous fuel), coking and blast furnace gases. The blast furnace gas is a mixture of gas obtained as a by-product of cast iron in a blast furnace. Its average composition is: 60% N2, 24% CO, 12% CO2, 4% H2 and ash. In the lower part of the blast furnace, air enriched with preheated oxygen is insufflated at about 1000 °C. This comes in contact with the coke that ignites with CO and CO2 production according to the Boudouard balance (2CO ďƒ› CO2+C). The gas rises from the blast furnace, reducing iron oxide to metal iron, but not all CO is oxidized to CO2.

The gases coming out of the furnace (blast furnace gas) are still rich in CO and can therefore be used as fuels, after the separation of the ashes. The cokery gas is a mixture of gas obtained by dry distillation of some types of litantrace.

Litantrace is distilled to produce metallurgical coke, the resulting gas is used as fuel, as a reagent or as a source of hydrogen; the composition is very similar to that of city gas, but with a higher hydrogen content. Methane is a simple hydrocarbon (alkane) consisting of a carbon atom and four of hydrogen; its chemical formula is CH4, and is found in nature in the form of gas. Below are the data collected on the average composition of some gaseous fuels with percentages expressed in volume (gas analyzers indicate data in volume percentages): %

Natural gas

Blast furnace gas

Cokery gas (from litantrace)

CH4

95,6

0,5

34

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CO

-

26

8

H2

-

3

50

Cm Hn

2,6

-

4

O2

0,2

-

-

N2

1,5

56

2

CO2

0,1

9,5

2

H2O

-

5

-

3 - CALCULATION OF COMBUSTION AIR AND CALORIFIC POWER Among the various elements that make up fuel, the phenomenon of combustion is interested from carbon, hydrogen, sulfur and oxygen. The elementary reactions of a complete combustion are represented as follows: C + O2 = CO2 2H2 + O2 = 2 H2O S+ O2 = SO2 The oxygen requirements can be easily obtained from the atomic and molecular masses of the elements indicated above: H (1, 2) – O (16, 32) – C (12, 12) – S (32, 32),

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rom which it derives, for example, that 32 kg of oxygen for 12 kg of carbon (rapport 8/3) 16 kg of oxygen for 2 kg of hydrogen (rapport 8) 32 kg of oxygen for 32 kg of sulfur (rapport 1) therefore for a molecule of CO2 are needed 32 kg of oxygen and 12 kg of carbon are necessary (the atomic mass of oxygen and 12 kg, the molecular mass of the molecule, consisting of two atomic masses of oxygen is 32 kg). Same for the water molecule H2O, where a molecular mass of hydrogen H2 binds to a molecular mass of oxygen O and therefore the stoichiometric ratio is 8 (16/2); the oxygen present is combined with the hydrogen (alloy) by subtracting the O/8 amount for which only H-O/8 actually participates in the combustion (hydrogen which remains free and therefore does not bind with oxygen). By indicating the mass percentages with C, H, S and O, the amount of stoichiometric oxygen required for combustion is analytically expressed by the following relation:

1 8  % mo  mo   C  8H  O  S  100  3 

kg

kg 

Considering then that the mass of air is made up of approximately 23 parts of oxygen and 77 parts of nitrogen (there is also 1% of rare gases), the stoichiometric mass necessary for the complete combustion process is given by the following relation:

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mat 

100 1 8  ma   C  8 H  O  S  23 23  3 

kg

kg 

For the combustion air it is also necessary to know the volume to determine the correct size of the pipes, the various sections of air passage in the system, to size the capacity of any fans. In this regard, the normal volume of a mole of gas measured in cubic meters is used and indicated with Nm3 (normal cubic meters), defined as the volume of a mole of gas at a temperature of 0 ° C and at a pressure of 760 mm of column of mercury equal to (1.013 bar); the normal volume of a mole is equal for all the gases and is equal to 22.40 m3 (number of kg equal to the molecular mass of the substance), therefore the specific volume O of the molecular mass oxygen 32 is given by the following relation:

V0  mo

22,4 32

Nm / kg  3

where mo is the percentage of oxygen necessary for combustion. By replacing the previous relation to mo and considering that the parts of oxygen in the air are 21, we obtain:

Vat 

100 100 22,4 1 22,4  8  Vo  mo   C  8H  O  S   21 21 32 21 32  3 



 Vat Nm3 / kg



The stoichiometric quantities determined by the above relationship would be sufficient in an ideal situation of perfect and homogeneous mixing, where each

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fuel molecule can come in contact and react completely with the corresponding oxidizing molecules (the oxidizing agent in the combustion, mainly oxygen) within the time available for combustion. In practice it is not possible to achieve the ideal condition described above, it is necessary to use a larger amount of air to ensure complete combustion of the fuel, in order to reduce waste, costs and reduce atmospheric pollution; the expression of the amount of real air to be used in combustion is usually expressed as follows:

mar  e  mat or:

Var  e  Vat e represents the excess air coefficient and has a value greater than unity.

The excess of air is very variable depending on the type of fuel (solid, liquid, gaseous) and the manner in which combustion takes place in relation to the technical applications of use. In steam boilers it assumes values between 1.60 to 1.80 with coal in pieces, while it goes down to 1.10 - 1.20 for liquid and gaseous fuels and for coal dust which all allow a better mixing with the combustion air (10% - 20% more than the stoichiometric values calculated from the theoretical model). In gas turbines the amount of air actually engaged reaches 300% - 400% more than the theoretical air with the coefficient and which takes on values from 3 to 4; the excess of air is not due to combustion but to limit the maximum temperature of the cycle by diluting the combusted gases with excess air. The experimental method most used to determine the excess air present in the combustion involves the knowledge of the percentage of the carbon dioxide present in the exhaust gases measured by special analyzers.

Note the percentage of carbon dioxide in combustion and the composition of the fuel it is possible to calculate the coefficient and through the following report for liquid and solid fuels:

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y 8 C (8H  S ) 100 e 3 y 8   C  8H  O  S  21  3  where y is the percentage by volume of CO2.

4 – CALCULATION OF CALORIFIC POWER The analytical determination of the calorific value of a fuel can be carried out by adding the quantity of heat supplied by the various components with the simplified hypothesis of separate combustion of the same (Dulong's law); the formula used known as Dulong's formula is an empirical relationship for calculating the higher calorific value, which combines the main combustion reactions considering the energy emitted by each of them. For a solid or liquid fuel it is possible to write, (with C, H, O the percentages of the mass of the various components contained in a kilogram of fuel determined by the elementary chemical analysis (1 °)) are indicated:

Hs 

 1  O  33 .

829 C  144 .

000 H   10 .

467 S     100  8  

kJ

kg 

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or

Hs 

 1  O  8 .

080 C  34 .

400 H   2 .

500 S    100  8  

kcal kp

The above relation, like the one below, uses the simplified logic of summing the amount of heat that develops in combustion every kg of the relative component multiplied by the percentage of mass present in a kilogram of fuel.

The lower calorific value can be written as follows:

1 Hi  Hs  2.4419 H  a  100

kJ

kg 

or

Hi  Hs 

1 5839 H  a  100

kcal kg 

The term subtractive is given by the evaporation heat of the water in kJ or kcal for the mass of water produced in the combustion increased from the humidity a present; in particular it results that 1 kg of hydrogen plus 8 kg of oxygen give 9 kg of H2O. The determination of the calorific power with the above relationships is acceptable in approximate way, for a more precise measurement experimental methods with calorimeters devices are used; the most used are the Berthelot-Mahler calorimetric bomb for liquid fuels and the Junkers calorimeter for gaseous fuels.

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(1°) Note: in analytical chemistry, the elemental analysis represents the determination of which chemical elements and in what quantities they combine to form a given material or substance. The quantity of the individual elements present is usually expressed as a percentage. One of the classic methods used for the elemental analysis of organic compounds exploits their combustion. In this way, elements such as carbon, hydrogen and nitrogen respectively form carbon dioxide, water and nitric oxide, from which it is possible to trace the original content of the chemical element sought by gravimetric analysis. Modern instruments and techniques have led to the development of automatic analyzers.

Gravimetric analysis is performed by two mainly methods, precipitation analysis: the component is separated by transforming it into a compound not much soluble which, after appropriate treatments, is weighed; analysis by volatilization: the component is determined by exploiting the volatility of one of its constituents (for example crystallization water in the determination of hydrated salts) or that of one of its derivatives (for example, carbon dioxide in the determination of carbonates).

By determining the loss of the weighed mass of the sample, data are obtained to ascertain the quantity or mass of the component under test (by analyzing the chemical reaction that forms the sample). This type of analysis has a margin of error of about 5%.

Below is the calorific value of wood:

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The higher calorific value of the wood depends to a maximum of 15% to the species of the plant; it in the commercial energy vectors is very variable and depends on the origin of the material and the treatments subsequently suffered, therefore the values in the table are purely indicative, however it is possible to refer to the data obtained by the Oak Ridge laboratories: Lower and Higher Heating Values of Gas, Liquid and Solid Fuels Filed on 20 February 2013 in the Internet Archive.

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5 - EXPERIMENTAL DETERMINATION OF CALORIFIC POWER. Two types of calorimeters are mainly used to determine the calorific value of fuels: the Berthelot-Mahler calorimetric bomb for solid and liquid fuels and the Junkers calorimeter for gaseous fuels.

Before proceeding with the study two calorimeters it is necessary to recall the definition of calorific value of a fuel: defined as the quantity of heat developed by 1 kg of fuel whether it is in the solid state that liquid or from 1 Nm3 (normal cubic meter, defined in paragraph 3) of gaseous fuel, in the course of the whole combustion. Full combustion means that during which all the carbon, in whatever form it is found in the original fuel, is transformed into carbon dioxide, C02, all the hydrogen in water H20, all the sulfur in sulfur dioxide SO2 and all the nitrogen in elementary nitrogen N2.

Berthelot-Mahler calorimetric bomb The calorimetric bomb, also known as the Mahler bomb, is a calorimeter with which it is possible to determine the amount of heat developed in the combustion of solid or liquid substances (combustion heat). The calorimetric bomb consists of a small, hermetically closed, strong-walled steel container in which a small porcelain capsule is placed in which the substance to be examined is placed. Inside the calorimetric bomb pure oxygen is introduced into pressure and the combustion is triggered by an electric resistance "immersed" in the substance to be examined. By passing electrical current through the electrical resistance, it becomes red hot and causes the rapid burning of the compound. The heat of the combustion reaction is absorbed by a known quantity of distilled water, in which the "bomb" is immersed.

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Known, by means of calibration, the thermal capacity C of the calorimetric bomb and taking into account that the specific heat of the water is equal to 4,184 J·g·°C-1, applying the fundamental law of thermology (°) we can to determine the

1

quantity of heat emitted during combustion.

(°) The fundamental law of thermology expresses the quantity of heat that must be given (or subtracted) from a body of mass m to raise or lower its temperature from the initial value t1 to the final value t2. The specific heat Csp is an intrinsic and characteristic property of every type of substance.

This value can be calculated by applying the following formula:

H s  m  4,184  (T2  T1 )  C  (T2  T1 ) in the which:

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m = mass in grams of the distilled water in which the calorimetric bomb is immersed (g); C = heat capacity of the calorimeter (J· °C-1); T1 = initial water temperature (°C); T2 = final water temperature (°C); Hs = amount of heat emitted during the combustion reaction (J).

In this way the higher calorific value is determined, ie the calorific value obtained if the water present at the reaction temperature of the combustion is in the liquid state without taking into account the quantity of heat engaged for the passage of state from liquid to gaseous, condition that in practice it does not happen because, the water present in the fuel evaporates by engaging part of the amount of heat developed during combustion, part that if subtracted from the same amount of total heat developed (higher calorific value obtained from the measurement of temperatures T1 and T2) allows the determination of the lower calorific value. For the determination of the latter, (lower calorific value), which occurs when the water is in the gaseous state at the reaction temperature of the combustion, it is necessary to know the quantity of water generated during combustion. The lower heating power differs from the higher calorific power precisely because it takes into account the quantity of heat (produced by combustion) engaged for the passage of liquid-to-gaseous state of the water present at the combustion reaction temperature, plus any water present in the fuel (liquid fuels). In practice, the lower calorific value is of greater interest because in most cases the flue gases leave the equipment still warm and therefore with the steamed water.

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The changeover from Hs to Hi in the calorimetric bomb occurs as follows: the bomb is extracted from the casing containing the water, a bottle with inert gas is connected to the inlet valve, generally nitrogen, absolutely anhydrous (dry). We connect to the outlet valve a tube containing a strongly hygroscopic substance (for example: anhydrous lime chloride); causing the gas to flow into the bomb, it will carry with it the water vapor molecules that are suspended inside and will cause further evaporation of the other water molecules. The gas that carries the water vapor exits the outlet valve ending up in the small tube containing the hygroscopic substance that absorbs the water. In this way all the water present in the bomb evaporates and is transferred to the hygroscopic substance which increases in weight; when all the water in the bomb is withdrawn, the hygroscopic substance ends up absorbing. The increase in weight of the hygroscopic substance gives us the quantity of water that has developed during the combustion of the mass of fuel. The lower calorific value is calculated from the higher calorific value through the following formula:

H s  H i  n  600 where n = quantity of condensed water and 600 is the latent evaporation heat of 1 kg of water (kcal / kg).

Calibration of the calorimetric bomb and determination of the thermal capacity of the calorimeter The thermal capacity of the calorimeter takes into account the fact that also its component parts (container, thermometer, stirrer, etc.) absorb heat.

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It is therefore necessary to predetermine the thermal capacity of the calorimeter, ie to determine the amount of heat needed to raise the temperature of this system by 1 ° C. It is possible to determine the thermal capacity of the calorimeter by having the reaction perform in the apparatus whose calorific value is known. Alternatively, the heat capacity of the calorimeter is determined by passing, through the resistance, a known quantity of electric current that is dissipated as heat inside the instrument.

The Junkers calorimeter The Junkers calorimeter is used to determine the specific heat of a gaseous fuel.

The operating principle is similar to that of a calorimetric bomb; it basically consists of a combustion chamber in which the gas is burned, contained within a container in which water flowing from the bottom upwards is introduced and

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which is heated by combustion. Several thermometers are placed at various heights to monitor the temperature.

A measured quantity of the gas for which the specific heat is to be determined is sent to the burner at a certain pressure which is measured by a pressure gauge.

After combustion of the gas, the products deriving from combustion migrate upwards and, through pipes, fall downwards and come out of the calorimeter.

The temperature at which the gases deriving from the combustion come out is recorded, which should be close to the ambient temperature; this implies that all the heat deriving from the combustion has been absorbed by the water. Any water formed by the condensation of the steam is collected in a container. In particular, the inlet temperature of the cooling water T1 is measured and the outlet temperature of the same is measured, the temperature T2; (to be observed that after a certain period of time, keeping the combustion unchanged, the temperature T2 reaches the steady state value and does not change). The system in the figure is such that the combustion fumes release all the heat to the

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water before leaving it. In this system the water formed in the combustion condenses with the cooling of the gases coming out of the system in the condenser. The higher calorific value is defined as follows:

Hs 

Gwa  (T 1  T 2)  C sp wa Vn

where:

Hs 

higher calorific value (kcal/Nm3), therefore it refers to the volumetric flow

of gaseous fuel,

Gwa= flow of cooling water flowing inside the calorimeter during the measurement (m3/t) where t is the time (minutes, seconds, hours),

Vn  volumetric

flow rate of the gaseous fuel (Nm3/t) where t is the time

(minutes, seconds, hours),

C sp wa 

Specific heat of water flow (J·g-1·°C-1).

Known the amount of water that has formed in the combustion and being the higher calorific value calculated without considering the amount of heat produced by combustion and engaged for the passage of water status from liquid to steam (as if the water present at the temperature of reaction of the combustion in the liquid state without having undergone the change of liquid-gas state), in fact the measurement of the temperatures used for the calculation are

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a consequence of the total absorption of heat by the water, it is at this point that the power lower calorific can be calculated, value obtained from following report:

H s  H i  n  600 where n = quantity of condensed water, 600 is the latent evaporation heat of 1 kg of water (kcal/kg).

Note: the enthalpy possessed by a thermodynamic system (usually indicated by H) is a status function defined as the sum of the internal energy U and the product of the pressure p for the volume V:

H  U  p V for an isocorobaric transformation (at constant volume and pressure), the variation of enthalpy coincides both with the heat (Q) and with the variation of internal energy (ΔU) that occurred during the process. Due to the fact that it is not normally possible to know the absolute value of the internal energy of a system or a substance, during a given thermodynamic transformation only the variation of enthalpy (ΔH) and not its absolute value can be measured; for example, in determining the variation of internal energy due to temperature variation, the part not dependent on temperature and which remains constant, is zero in the difference between the two initial and final energy levels caused by the temperature variation, which could be difficult to determine if you want to calculate the initial, absolute internal energy value. It is possible to define a reference value that will identify a starting energy state or even identify it as a zero energy state and refer to the calculations at this reference level, thus calculating not the absolute value but the variation of the state size required for the project.

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6 – EFFICIENCY OF A ENGINE PLANT In order to determine the efficiency of an engine plant and therefore not of the single operating machine or of the single driving machine but of the group of operating machine plus driving machine, it should be considered that this consumes primary energy available in nature and can be in the form of energy potential and, or kinetics of fluids such as for hydraulic and wind power plants (for example, power plants with hydraulic turbines or wind turbines). In thermal engine plants, instead, chemical fuel energy is consumed (excluding nuclear plants not of interest for this research); for the overall efficiency of the engine plant, reference is made to the mechanical power Pma used on the crankshaft and the thermal power corresponding to the fuel consumed. Measuring Pma in kW, indicating with



m

c

the fuel flow consumed, measured in kg/s and indicating

with Hi the lower calorific value measured in kJ/kg, the global efficiency

g

is

calculated by the following relation:

g 



Pma

m

c

Hi

By measuring the calorific value in kcal/kp and the fuel flow rate in kp/h the relationship above becomes:

g 

860 Pma 

m

c

Hi

where 860 [kcal / kWh] is the thermal equivalent of kWh. The Ng yield in thermal engines can be broken down into the four-yield product:

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b  combustion efficiency

l  efficiency limit

i  internal efficiency  m  mechanical efficiency

The combustion efficiency

b

takes into account the following dynamics: in a

motor system there is a phase of heat development and subsequent adduction to the fluid (gas or steam) that operates actively in the plant. The heat development phase is characterized by a combustion that can be internal or external to the operating fluid (internal for internal combustion engines, gas turbines, external for example for steam turbines), under no circumstances can it be complete as well as being affected by other minor losses related to heat loss to the environment outside the machine. We can therefore consider that in practice not all the thermal power



m

c

Hi theoretically available is actually 

received from the operating fluid, but only an aliquot Q1 < m c Hi dynamics that allows the definition of the combustion efficiency

b

or more generally of the

development of heat and its adduction to the operating fluid: 

b 

Q1 

m

c

Hi

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The limit efficiency

ď ¨l

takes into account the following phenomena related to

the cycle in which the motor fluid evolves: the fluid to which heat is transferred from the combustion evolves in the driving machine operating according to a determined thermodynamic cycle (for example Rankine or Hirn for those in steam, of Joule for gas turbines, Otto cycle for internal combustion engines), a logic that requires an ideal behavior as well as the same fluid also of the complex of machines (operating and traction) that build the engine system. This means that the evolving fluid has specific heat constant with the temperature and that the walls of the machine should be perfectly adiabatic during the compression and expansion phases and perfectly permeable to the heat (adiabatic) during the heat exchange between the fluid and the environment (and the other way around). Logic that would requires for the construction of a plant too far from the technical and practical possibilities; at to weigh is certainly the impossibility of obtaining a fluid with ideal behavior because of the two physical-chemical characteristics on which it is not possible to influence in any way: the variability of specific heat with temperature, and the variability of the molecular species of the motor fluid due to internal combustion in internal combustion engines, (the engine fluid obtained from the combustion of the fuelair mixture). On the contrary, one could admit the ideal behavior of the engine system, assuming the limit condition in which all losses are eliminated. Under these conditions it is possible to refer to a limit cycle relative to a perfect machine in which a real fluid evolves (in which the viscosity effects are assumed null) obtaining from the hypothesis mentioned that the adiabatic compression and expansion phases, for the machine in the perfect conditions of perfect isolation, are also isentropic; the viscosity hypothesis is a consequence of the perfectly insulated machine as this, although strongly influenced by the design and the dimensions of the machine as well as by the various parts, the relative effects are null in the hypothesis of a limit cycle in which the machines are

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supposed to be ideal and therefore supposing the hypothesis of null losses, including those related to viscosity (considered null). By indicating with Pi the useful power obtainable from this cycle, the following ratio is defined as limit efficiency:

l 

Pi 

Q1 

where

Q 1 is the thermal power actually received from the fluid.

The internal efficiency

i

eliminates the hypothesis of a perfectly real machine

and therefore the real fluid operating in it undergoes further inevitable losses; in particular, the power transferred to the mechanical parts of the machine is not that of the limit cycle Pl but a power of Pr minor; the following report defines the internal performance of a machine:

Pr i  Pl and takes into account all the losses related to the real operation of the machine, representing an index of goodness of the engine system. The product between the limit yield and the internal efficiency defines the real thermal efficiency

 tr

which, as indicated in the following report, is provided by the ratio between the power actually transferred to the mobile parts of the machine and the thermal power received by the fluid acting.

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Pl Pr Pr tr  l i      Q1 Pl Q1 The mechanical efficiency

m

takes into account the frictions that are

generated between all the organs equipped with relative motion and the unavoidable auxiliary mechanisms such as pumps, fans and others, necessary for the operation of the machine and driven by the crankshaft, loads that reduce the power supplied Pr on the shaft itself for the operating machines and therefore there is a mechanical power Pma lower than Pr. The mechanical efficiency is defined by the following ratio:

Pma m  Pr In conclusion, the breakdown of the overall efficiency in the product of the four efficiencys defined above is as follows: 

Q1

Pl Pr Pma Pma  g   b   l  i  m       mc H i m c H i Ql Pl Pr replacing it with the actual thermal efficiency, becomes:

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 g  b tr  m The subdivision of the global yield from the division of losses into four categories or classes has a general validity and is absolutely rational, being exact if the heat adopted in the real cycle coincides with that relating to the limit cycle; a fact that is not always verified, just think of the gas turbines, for example, where the heat used in the actual cycle is always smaller and therefore the above formulas must be appropriately corrected.

From the expressions of the global efficiency without subdividing into the four yields, defined above, it is possible to calculate a parameter of great interest in thermal engine plants, the specific fuel consumption cs which represents the fuel flow rate, expressed in kg/s and in kp/h, which is consumed per unit of power, ie per kW; its expression of calculation turns out to be: 

cs 

1 mc  Pma  g H i

 kg   s  kW 

multiplying by the conversion factor 3600 is expressed as cs in kg/(h kW), 

m c 3600  kg  cs   Pma  g H i  h  kW  or also

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

mc 860 cs   Pma  g H i

 kp   h  kW   

Heat is often used as the heat needed to produce the mechanical work unit defined by the relationship

q  cs  H i the expression of cs defined above is obtained

q  cs  H i  3600 /  g

 kJ   kWh 

The knowledge of the specific consumption allows to obtain the global efficiency without having to know the lower calorific value of the fuel used. It is obvious that the specific consumption will be as low as the higher the yield and expresses a very important technical data as indicative of the degree of perfection and economy (also in terms of pollution: a engine plant, that burns less fuel for the work required certainly pollutes less) of a thermal engine system. The formulas studied here remain valid also for a reduced engine installation to a single device, the prime mover, as in the case of alternative internal combustion engines.

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Sources for research: Directive 75/716/EEC, sulfur content fuels | Directiva 87/219/EEC,amending directive 75/716/EEC | Directive 93/12/ECC, sulphur content of certain liquid fuels | Directive 98/70/EC, quality petrol and disel | Directive 2009/30/EC, amending directive 98/70/EC | ISO 8754 |ISO 4259,2-2017 | Directive vehicles | Directive

94/12/EC,

70/220/EEC,

measures

motor

vehicle

atmospheric

pollution

type-approval | Directive

2014/77/EU, amending Annexes I and II directive 98/70/EC |DIRECTIVE (EU) 2015/1513, amending directive 98/70/EC | Clipboard, course of Machines, Federico II University of Naples, Mechanical Engineering, Professor Renato della Volpe | Renato della Volpe, Machines, Liguori Editore, Naples, 1994 | Sources: Mario Alnin, Steam Generators, Liguori Editore, Naples 1967 |

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Publication list

H Research Edition English: publication 04 magazine number 2019-20

MECHANICS APPLIED TO MACHINES Evolution of the Teaching in School System

publication 2019-20 04

0 - ABSTRAC

1- CHAPTER ONE The Mechanics Applied to Machines in Naples: the texts

2- CHAPTER TWO Mechanics Applied to Machines in Naples: its historical development

II.1 - HISTORICAL NEWS ON THE BIRTH OF MECHANICS APPLIED TO MACHINES

II.2 - FIRST NEWS ON THE ARGUMENTS OF MECHANICS APPLIED TO MACHINES

II.3 - THE MECHANICS APPLIED TO OFFICIAL MACHINES

II.4 - ARGUMENTS OF MECHANICS APPLIED TO MACHINES

APPENDIX The list of the texts of Mechanics Applied to Machines, or containing topics typical of the Mechanics Applied to Machines, which are present in the Federico II Engineering Faculty of Naples, Italy

BIBLIOGRAPHY B. I Alphabetical List B. II List in chronological order B. III List of authors in alphabetical order B. IV List of authors in chronological order

Author: engineer Vito Gnazzo

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Evolution of teaching in the school system.

Mechanics applied to Machines.

CHAPTER ONE The Mechanics Applied to Machines in Naples: the texts We do not think it possible to reconstruct the development of the teaching of Applied Mechanics to Machines in Naples on the basis of the texts that the various teachers we have heard about wrote or used for the development of their lessons, lacking, among other things, certain indications for the whole period to which we have turned our interest. At the same time we consider important the knowledge of the bases on which they have been forming not only the students, but also the teachers who have taught in what is currently the Faculty of Engineering. We also consider it important, for future studies, to make known the library equipment available in the Faculty and in the departments connected to it.

For these reasons we have collected in this chapter the various texts of which we have come to know, reporting in full the indexes of the topics, obviously useful to know the problems considered interesting for the study and at the same time understand their evolution.

1) Year 1777 -- Appreffo Giuseppe Galeazzi, Royal Printer (with permission from Superiors); FINBC, A XIII B 44;

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A. D. P. Frisi -- Institutions of mechanics, hydrostatics, hydrometry, and static and hydraulic architecture for use by the Regia Scuola Eretta in Milan for architects, and for engineers -- (p. 487); A. D. P. Frisi, Regio censor and professor of mathematics, member of the Academies of Sciences of London, Berlin, Petersburg, Bologna, Copenhague, Stockolm, Upsal, Harem, Siena, Lyon, Berne, Correspondent of the Royal Academy of Sciences in Paris; Paolo Frisi: the 1700 opens with the gigantic figure of Paolo Frisi, priest, scientist, mathematician, physicist, writer. Paolo Frisi is one of the highest glories of Melegnano (Milan, Italy); his thought and his work have left an indelible mark on the science and culture of the 1700s. In the bibliographic presentation of the author, written by Anna Maria Salini; "Frisi Paolo (1728-1784). Barnabita, mathematician and scientist. Born in Melegnano from Giovanni Mattia and Francesca Magnetti in 1728, he attended the Arcimbolde schools near S. Alessandro and, very soon, the Biblioteca Ambrosiana, which contains in seven codes many of his letters.

Although he studied literature, philosophy and theology, due to his lively inclination he devoted himself to mathematics, physical cosmography, hydraulics in which he soon distinguished himself both in the field of university teaching in Pisa (1756-64), at the Palatine Schools of Milan. and in Bologna since 1764, both in written dissertations and in practical and scientific applications. However, he also taught philosophy in Lodi, Casale Monferrato, Pisa and the Arcimbolde of Milan.

He was the first to teach the existence and use of the lightning rod and to introduce the use of the telescope level and to deny the existence of magic and witches "without any danger - writes Verri - and anxiety" because of Inquisition. He received awards and prizes for his important dissertations, from that "On the annual motion of the earth" (1751) to that "On electricity" of 1758, from the "De gravitate universali corporum" of 1768, to the "Institutions of mechanics, hydrostatics , of hydrometry and of static and hydraulic architecture ..", of 1777, by the Academies of Berlin, of Petersburg, of London. He was awarded a gold medal by the King of Prussia, by Joseph II, by the King of Denmark and also a member of other Academies: Stockholm, Uppsala, Bologna, Siena, Lyon. He made several trips to

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Lombardy, Piedmont, Tuscany for assignments by princes and governments. Also Clemente XIII° in 1760 used him for works of plumbing and arrangement of the course of the Rhine and other rivers. In Milan he was asked to build a canal with Pavia and for navigational projects of the Oglio and Adda and other Milanese waterways. He also made a plan for the Specola di Brera and for the College of Engineers and also took care of the project in 1764 of which all Milan spoke of the construction of the main spire of the Duomo, expressing, however. as a mathematician also expert in architecture, negative opinion in the "Considerations of architecture, physics and mechanics over the dome of the Milan Cathedral". His opinion, interesting and curious, refers to the biographer Pietro Verri: "While the floor of the Duomo is not finished, but in part it is similar to that of a stable; while the façade is half-finished, and for the remainder shows a crude acervo of stones and bricks, to think of lavishing a large sum of money on the ornament of the last summit, it was a method error at least ...". He then said that "... not without danger could such weight be added, that that very high tower would be easily thunderstruck; that would have made the figure of the Church deformed. Now everyone sees that he was right, and that he would do better by following his opinion. But then, because of his attempts to prevent a truly ridiculous deformity, he was exposed to the personal animosity of some engineer and many patricians."

His opposition might seem excessive, but in the long run concerning the static was not quite completely wrong: they have amply demonstrated, after several previous interventions, the impressive and complex restoration works on the four tiburio piers completed in 1986. Always a Milan, Frisi collaborated in the "Caffè", with other great Lombard reformers such as Verri brothers, C. Beccaria, GR Carli, and it was him, also with his trips to Paris, London, Amsterdam, where he met many scholars - including Diderot and d'Alembert - with whom they then kept in correspondence, to act as a link between the illuminists of northern Italy and the main European scientists (Spallanzani, Lagrange, Condorcet ...). In 1768 he was in Vienna where he met the Kaunitz who took advantage of the fame he enjoyed to make him write also of canon law and above the jurisdictional disputes between the Church and the Empire (Reasoning over the temporal power of the princes and the

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spiritual authority of the Church). Back in Milan, when the Imperial College, where he lived, was destined for other use, Frisi left the congregation, but not the habit: Pius VI, in fact, in 1776 granted him the secularization: the judgment was different of two of his barnabite biographers Boffito refers to the justification put forward by Verri, while the Premoli sees an intolerance, after the triumphs in the scientific field, for "every dependence on superiors", for "every prescription of religious life" because "he for some time he lived more in the world than in the cloister ". But it will be feel sorry for oneself with and honored by the Barnabites, after his pious death witnessed by P. Racagni, which took place in Milan on 22 November 1784, with a sepulchral monument in Sant'Alessandro and a magnificent epigraph exalting its merits and its value. Also worthy of mention is the eulogy of his friend Verri.

"He, with his example, with his lessons, with his writings, was the first who shook the nation from sleep ... he substituted for the scholastic notions the truths demonstrated; frivolous questions, the knowledge of heaven and earthly phenomena; to dialectic Arabic, the infallible calculation. (Information reported by internet) From the timbre on the first text sheet, the original location is visible: Library of the Application School in Naples.

The text contains the main mechanical disciplines mainly studied at the time in the Application Schools.

INDEX ARGUMENTS: I) Of the Mechanics and the Statica that is of the general laws of the balance and the motion of the bodies. Book first; first notions of motion, of the first laws of uniform and variable motion, compositions, serious, free descent of bodies, in curvilinear, pendulum, motion of projectiles, balance and center of gravity, theory and handling of simple and composed machines; II) Static Architecture, ie the application of the previous principles to the theory of factories. Second book;

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III) Of the principles, and of the uses of the hydrostatics, that is the laws of the equilibrium of the fluid bodies and of the leveling. Third Book; IV) Of the principles of hydraulics. Book Fourth; V) Of the hydrometry of the rivers, and of the channels. Book fifth; VI) From the physical geography of rivers. Book sixth; VII) Of the architecture of the rivers and streams. Seventh Book; VIII) Of the architecture of the navigable canals. Eighth Book.

As is evident, the text deals with most of the problems of hydraulics. Only in the first book are considered some of the topics also present today in the texts of Mechanics Applied to Machines, such as systems for lifting loads.

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2) Year 1811-- J. Klostermann fils, Libreria dell’Ecole Imperiale Polytechnique – Parigi; FINBEC, A XXIV C 33; M. Hakette -- Traité elementair des machines -- (p. 452); M. Hachette, teacher of the Polytechnic Imperial School, Paris.

From the timbre on the first sheet of the text, the original location is visible: Library of the Application School in Naples.

INDEX ARGUMENTS: I) Machines and forces applied to movement, Elementary machines, Animation forces, Force considerations II) First class hydraulic machines III) Second class hydraulic machines IV) Gear theory, cylindrical wheels, gear of a rack wheel.

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3) Year 1818 -- Libreria Quai Des Agustin - Bachelier; FINBC, A XX D 48; Me. J. - Borgnis -- Complete treaty of mechanics applied to the arts -- (p. 287 + 26 graphical tables): contenant lâ&#x20AC;&#x2122;exposition Paris; Borgnis, engineer and member of several French Academies.

The text deals more with the manufacturing techniques of military machines, weapons, cannons. The first chapters are dedicated to the construction of building structures, (perhaps always related to the military sector).

INDEX ARGUMENTS: V) Machines of which civil architecture uses 1) The strength of matter 2) Manufacturing of bricks 3) Pulverization of the different substances used in the arts that depend on civil architecture VI) Machines dependent on hydraulic architecture 1) Poll 2) Cleanup 3) Extraction of submerged solid bodies VII)

Military machines

1) Old military machines 2) Manufacture of white weapons (without gunpowder) 3) Manufacture of firearms 4) Manufacture of cannons 5) Manufactures for spreading cannons VIII)

Machines dependent on shipbuilding

IX) Rope manufacture X) Manufacture of anchors XI) Rigid anchors

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4) Year 1828 -- Libreria Quai De Agustin, Bachelier â&#x20AC;&#x201C; Paris; FINBEC, XXIV C 17; C. A. Coulomb -- Theory of simple machines with considerations on the friction of their parts and on the rigidity of the strings -- (p. 368 + 18 illustrated tables) C. A. Coulomb, cavaliere di Savint- Luis, Capitano del Genio, of the institute of France, Member of the Legion of Honor.

The topic index could not be found.

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5) Year 1842 -- Libreria, Polytechique De J. Baudry - Paris; FINBC, A XXIII C 53; Redtenbacher -- Principes de la construction des organes des machines -- (pag.

459); F. Redtenbacher, professore all’Écolè Polytechique di Francia.

From the timbre on the first sheet of the text, the original location is visible: Library of the Application School in Naples.

INDEX ARGUMENTS I) Elasticity and resistance of materials II) Construction of machine parts III) Calculation of passive resistance IV) Gears V) Mechanisms of movement VI) Machines driven by human force

6) Year 1839 -- Library Quai Des Agustin Bachelier - Paris; FINBC A XXIII A 09; F. - M. G. de Pambour -- Théorie De La Machine a Vapeur -- (p. 420); F. – M. G. de Pambour, in the text, he is mentioned as an elder of the écolé polytechnique of Paris.

From the timbre on the first sheet of the text, the original location is visible: Library of the Application School in Naples.

The book is in French and is intended to prove the inaccuracy of the methods used to evaluate the effects of the proportions of steam engines; moreover, it is destined to replace a series of analytical formulas, apt to determine the speed of a given machine, its vaporization for desired effects, its strength in horses, its useful effect for a known consumption of water and fuel, the load or relaxation that needs to be given to him to make him produce his maximum useful effect.

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INDEX ARGUMENTS: I) Evidence of the inaccuracy of ordinary calculation methods II) The laws that regulate the mechanical action of steam III) General theory of the steam engine IV) High pressure machines V) Locomotive machines VI) Double-acting rotary machines, by Watt VII) Double-acting Cornuvalies machines VIII) Woolly or Edwards machines IX) Evans machines X) Single-acting Watt machines XI) Single-effect Cornuvalies machines XII) Atmospheric machines

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7) Year 1852 -- Langlois & Leclerco / Victor Masson - Paris; FINBC A XXIII A 35; M. Ch. Delaunay -- Elementary course of applied theoretical mechanics -- (p.

691); M. Ch. Delaunay, professor of mechanics at the Ă&#x2030;cole Polytechnique and the faculty of Analysis of Paris.

From the timbre on the first sheet of the text, the original location is visible: Library of the Application School in Naples.

The book is in French; deals largely with the knowledge of the time, the general principles of mechanics related to motion and balance of solid bodies, liquids and so-called complex machines, such as kinematics systems of connection with elastic elements, with gears, with chains, the coupling of the rail wheel, also treats the first applications of systems for lifting the water "pumps", are widely treated (within the limits of the knowledge of the time) the hydraulic turbines, steam engines. A complete illustration of the mechanism or the machine is given to a complete discussion of the arguments, by means of a large number of drawings.

INDEX ARGUMENTS: I)

General notions on movement

II)

General notions on forces

III)

Compositions of forces

IV)

Center of gravity of a body

V)

Study of different machines from the point of view of the balance of forces that are applied to them

VI)

Study of the machines in a state of uniform movement

VII)

Production and modification of the movement with the forces

VIII)

Passive resistances

IX)

Study of the machines in a non-uniform movement state

X)

Application of the principles prior to the study of any machine

XI)

General concepts on the transport of loads

XII)

General considerations on engines

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XIII)

Principles related to fluid balance

XIV)

Principles related to the movement of fluids

XV)

Machines used to lift liquids

XVI)

Use of water as a motor

XVII) Machines used to move the gas XVIII) Use of the wind as a motor XIX)

Use of steam as a motor

XX)

Use of electricity as a motor

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8) Year 1854 -- Mantova publishers-typographers Fratelli Negretti - Mantova; FINBC, A XXIII A 53); A. Clementi

--

Manual of Technical-Practical Mechanics for artists,

professionals, owners etc. -- (p. 150 + 2 tables on the "graphic signs used in mechanicsâ&#x20AC;?); Antonio Clementi Director of the Imp. Director of the Scuola Normale in Venice and member of various Scientific-Literary Academies.

From the timbre on the first sheet of text, the original location is visible: Library of Naples of the Faculty of Engineering.

It is a manual of mechanics, realized for those who do not have a solid mathematical base; it consists of two parts, the first deals with the laws of motion and the balance of bodies, the second of the machines. At the end of the book there is an appendix showing all the specific gravities of the fluids known at the time and two large plates with the illustration of all the symbols of the mechanics used during that period.

PREFACE The study of mechanics has become today of no small importance to the man gathered in the civil society, much because it enables him to acquire the foundations of knowledge on many laws of nature, but because he has immense advantages in many professions, and in the use of the most common machines and tools: and not only prevents errors and slowness in many works, but it often leads well to useful discoveries and improvements aimed at employing in the world the most useful the various forces of which I am endowed or many bodies in nature, so as to satisfy the many needs and comforts of society with savings in spending, faculty and time.

This restricted manual is therefore intended to disseminate useful knowledge of the sphere of mechanics among those who, for lack of a well-founded mathematical education, can not make use of rigorously scientific works on this subject. So we believed that we were not wrong, if we were able to deal with the most important truths of this science in an intelligible way to the greater class of readers, without

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however completely dispensing from demonstrations, where these were recognized as indispensable.

In the compilation of this work we had regard for the prefixed limits; as for the order and the exposition, we have tried to serve as much as possible to simplicity and clarity, as to the essential conditions to which every elementary book must satisfy.

There are two parts in which it is decided: the first deals with the laws of motion and the balance of bodies; the second of the machines. The appendix then includes a brief description of the steam engine in its principles, some on electricity and on how to set lightning rods; and for more known.

The paragraphs that contain the main definitions and the most important rules of mechanics, are marked with larger characters and can in themselves form a whole independent of the rest, which contains ancillary rules, demonstrations, warnings, etc. and which are indicated with minor characters.

INDEX ARGUMENTS: Part one: Laws of motion and the balance of bodies I) General laws of motion and balance of bodies 1) Of Matter 2) Of the motion itself without regard to the forces that produce it 3) Of the forces apt to produce a motion II) Laws of the equilibrium and motion of liquid fluids 1) Balance of liquid fluids 2) The motion of liquid fluids III) Laws of the equilibrium and of the movement of expansible fluids IV) Laws of obstacles to motion Second part Laws of motion and balance of the machines I)

Of simple machines

II)

Of compound machines

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Appendix A.

Expensive description of steam engines in its principles

B.

Brief history of steam engines

C.

Some notes on electricity and how to draw lightning rods

D.

Table of specific gravities of the most known solids and liquids

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9) Year 1860 -- Royal Military Typography - Naples; FINBC, A XXIII B 24; Vincenzo A. Rossi -- Mechanical, technical and practical principles of machine theory with a practical manual -- (p. 936 + 17 tables); Vincenzo A. Rossi, civil engineer and member of several academies.

INDEX ARGUMENTS: I)

Dalle forze e dai loro effetti in generale, dalla loro misurazione in natura e da cui trattarli, e dalle condizioni e vantaggi di una macchina nota

II)

Manual 1) Definizioni e principi sulla meccanica in generale, sulla macchina in generale, sull'attrito, sulla rigiditĂ delle funi della catena, sulla resistenza dei veicoli.

2) Practical questions and rules or answers to solve 3) Numerical tables

III)

From the transformation of movements and the transmission of forces 1) Need to transform the movements in the machines to obtain the desired strength. How to design and study them.

(Following all the types of transformation of motions, from straight to circular, etc.)

IV)

Manual: for the transformation of movements and for the transmission of forces.

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10) Year 1861 -- Quai De Agustins Library - Paris; FINBC, A XXIII A 65; J. N. Haton de la Coupilliere -- Treaty of mechanisms -- (p. 484); From the timbre on the first text sheet, the original location is visible: Library of the Application School of Naples.

INDEX ARGUMENTS: I)

Geometric theories (generalities, study of uniform transmissions)

II)

Variable transmission rollers (ellipse, hyperbole, parabolic)

III)

Slides (cylindrical, revolving, helical, double-acting)

IV)

Eccentric eccentric grooves (generalities, rectilinear grooves, uniform transmissions, sinusoidal transmissions)

V)

Eccentric to framework

VI)

Plans gears

VII)

Gears surfaces

VIII) Gear trains IX)

Epicycloidal gears

X)

Triangular gears

XI)

Transmission ratios, combination of movements

XII)

Parallelogram and joints

XIII) Ropes XIV)

Setting the destinations

XV)

Regulation of the mechanisms

XVI)

Dynamic indications

XVII) Pressure Gauges XVIII) General properties of friction XIX)

Usefulness of friction

XX)

Resistance to movement

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11) Year 1861 -- Scientific, industrial and agricultural library of E. Lacroin FINBC, A XIX B 55; Ch. Laboulaye -- Kinematics or theory of mechanisms -- (p. 830); From the timbre on the first text sheet, the original location is visible: Library of the Application School of Naples.

Ch. Laboulaye, in the text he is cited as an elder of the ĂŠcolĂŠ polytechnique.

INDEX ARGUMENTS: I)

Basic principles, (on the motion of bodies)

II)

The simple machines

III) Parts of the machines IV) Mechanical parts V)

Movement transformation organs

VI) Continuous circular motion in continuous circular (in continuous circular reference) VII) Constant speed ratio - parallel axes VIII) Variable speed ratio - parallel axes IX) Aces that meet X)

Axes in space

XI) Non-parallel axes XII) Continuous circular motion in continuous rectilinear (reference system with continuous rectilinear motion) XIII) Continuous rectilinear movement in continuous rectilinear XIV) Continuous movements and alternating movements: XV) Continuous circular motion in alternate circular XVI) Continuous circular movements in alternates rectilinears XVII) Continuous rectilinear movement in alternate circular XVIII) Continuous rectilinear movement in alternate rectilinear XIX) Circular movement alternating in alternate circular XX) Alternating circular motion in alternate rectilinear XXI) Continuous rectilinear movement in alternate rectilinear

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XXII) Combination of movements XXIII) Any movement in a curved movement XXIV) Combination of speeds XXV) Movement modification organs: speed variation organs, movement regulation organs, organs of arrĂŞt XXVI) Operators: vertical transport of heavy bodies, horizontal transport of heavy bodies XXVII) Arrangement organs: XXVIII)

Useful machines

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12) Year 1861 -- Library publisher Bassermann - Mannheim; FINBC, A XXIII C 53; F. Redtenbacher

--

Atlas of scientific and practical results for machine

construction -- (only graphic tables); From the timbre on the first text sheet, the original location is visible: Library of the Application School of Naples.

F. Redtenbacher : Director of the Polytechnic School of Carlruhe.

The text is composed of graphics only.

THERE IS NO INDEX

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13) Year 1862 -- Mallet-Bachellier, Imperial Library - Paris A XIX C 11; H. Resal -- Treaty of pure kinematics -- (p. 412); From the timbre on the first sheet of the text, the original location is visible: Library of the Application School of Naples.

H. Resal, engineer de Mines, doctor and scientist.

INDEX ARGUMENTS: I) Speed: speed preliminary notions, speed, projection on one direction or plane, composition of simultaneous velocities, applications of the geometric composition of velocities;

II) Acceleration and its properties: acceleration, projection on an axis, projection on a plane, composition

of

accelerations,

application

of

acceleration

composition, general theorem related to movement of a point;

III) Geometric movement of invariable systems: movement of translation and rotation, movement of an invariable system parallel to a fixed plane, general movement of an invariable system, composition of translation and rotation;

IV) Acceleration in the movement of an invariable system: acceleration in the plane movement on a plane, acceleration in the movement of an invariable system around a fixed point, acceleration in the general movement of an invariable system;

V) Relative movement:

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relative movement of a point with respect to an invariable system, super-acceleration (jerk) of the movement of a point, superacceleration (jerk) in the movement of a flat figure, superacceleration (jerk) in the movement of an invariable system around a fixed point, super-acceleration (click) in the general movement of an invariable system.

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14) Year 1866 -- Publisher Library J. Baudry, Paris et Liège (Paris, via Saintes Pères 15 / Liège, place Saint Paul 6) - Paris et Liège; FINBC, A XXIII B 10; V. Dwelshauvers -- Manual of applied mechanics -- (p. 210 + 8 tables); From the timbre on the first sheet of the text, the original location is visible: Library of the Application School of Naples.

Doctor, physical scientist and mathematician; repeater at the Mines Liège school INDEX ARGUMENTS: I) Study Algorithm-speed: constant speed, uniform movement; variable speed, variable movement; uniform variable movement II) Geometric study - direction of movement: rectilinear movement, circular movement, any movement III) Speed composition and decomposition IV) Relative and comparative movements V) Movements of rigid figures VI) Geometric studies - compositions and decompositions: competing axes, parallel axes, rotation components, non-parallel and non-competitor axes, acceleration, resistant movement VII) Theory of mechanisms VIII) Movement transmission by immediate contact IX) Transmission of the movement by flexible intermediary X) Movement transmission for rigid intermediary XI) Trains or crews of elementary mechanisms and complex mechanisms XII) Searches for laws of movement

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15) Year 1868 -- Library publisher Bassermann, Heidelberg - Paris; FINBC, A XXIII D 45; F. Redtenbacher â&#x20AC;&#x201C; Scientific and practical results for the construction of the machines -- (p. 472); From the timbre on the first text sheet, the original location is visible: Library of the Royal School of Application of Naples.

INDEX ARGUMENTS: Geometry I) Arrangement of the different curves II) Calculation of surface and volume III) Pulleys IV) Rolled rough-hew to the laminate V) Gears VI) Piston guides Resistance of materials VII)

Absolute resistance

VIII) Relative resistance IX) Reactive resistance X) Twist XI) Resistance of the mud XII)

Tension of the blades

XIII) Piegatura delle barre e delle lame XIV)

Solids of equal strength

XV)

Comparison of the different sections

XVI)

Resistances of solids against living forces

XVII) Coefficient of resistance and elasticity Construction of machine organs XVIII) Rope XIX) Chains XX) Assembly screws

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XXI) Rivets XXII) Couplings of trees XXIII) Bearings XXIV) Pulleys XXV) Rollers and tension pulleys XXVI) Endless screw XXVII) Bearing chairs XXVIII) Levers elbows XXIX) Crank XXX) Crank axles XXXI) Traverse XXXII) Biella XXXIII) Outrigger XXXIV) Besants pour differente applicazione XXXV) Tuyaux XXXVI) Covers, limped to packaging XXXVII) Valves, faucets, pistons XXXVIII) Calculation results applied to the construction of BÃ timeuts Friction between series of solid bodies stiffness of the ropes XXXIX)

Friction coefficient

XL) Calculation formulas for friction resistance Hydraulic wheels XLI) Rules for the arrangement and construction of a water wheel XLII) Tracing the wheels XLIII) Norms for the construction of hydraulic wheels XLIV) Norms for calculating the useful effect of old hydraulic wheels Turbines XLV) Turbines XLVI) Turbines XLVII) Radial wheels XLVIII) Tangential wheels

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Heat and its use XLIX) Pressure work L)

The steam of water Steam machines

LI) Theoretical results LII) Practical results LIII) Steam machines flywheels LIV) Results for the practical determination of the dimensions of steam machines LV) Wind machines Transportation for roads and lands LVI) Locomotive LVII) Steam wheels

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16) Year 1870

--

Imprimeur-Libreria, Gauthier-Villars della Scuola Imperiale

Politecnico, (Quais De Agustin, 55) - Paris; FINBEC, A XXIII B 52; J. - V. Poncelet

--

Introduction to physical or experimental industrial

mechanics -- (p. 520 + 2 tables); From the timbre on the first sheet of the text, the original location is visible: Library of the Application School of Naples.

INDEX ARGUMENTS: I) General notions on the constitution and physical properties of the bodies; II) Preliminary notions on movement, forces and their effect; III) Movement information for constant driving forces; IV) Direct information of the movement by general forces; V) Resistances VI) Rubbing of solids VII) Fluid resistances

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H Research Edition. ISSN 2532-5612. Publication 2019-20,04 Division edition Group HTNET www.htnetEdition.eu

17) Year 1872 – Library Dictionnaire of art and artifacts, 40 Rue Madame, 40 Paris; FINBC, A XXIII B 49; A. Taffe -- Applications de la Mécanique aux machines -- (p. 539); From the timbre on the first text sheet, the original location is visible: Library of the Royal School of Application of Naples.

A. Taffe, professor at the school of art and material, senior artillery officer, senior Chef.

INDEX ARGUMENTS: I) Notions fundamental on the movement, on the forces and at work; II) Notions concerning dynamic work; III) Applications of mechanics; IV) Notions of hydraulics practice; V) Applications of the mechanics to hydraulic wheels; VI) Steam machines; VII) Operating machines VIII) Experimental measurement of the work transmitted by a rotating axis;

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H Research Edition. ISSN 2532-5612. Publication 2019-20,04 Division edition Group HTNET www.htnetEdition.eu

H Research Edition. ISSN 2532-5612. Publication 2019-20,04 Division edition Group HTNET www.htnetEdition.eu

H Research Edition. ISSN 2532-5612. Publication 2019-20,04 Division edition Group HTNET www.htnetEdition.eu

18) Year 1874 -- Gahutier-Villars Imperial Library - Paris; FINBC, A XXIII B 52; J. â&#x20AC;&#x201C; V. Poncelet -- Course of mechanics applied to the machines -- (p. 520); From the timbre on the first text sheet, the original location is visible: Library of the Application School of Naples.

INDEX ARGUMENTS: I) General considerations on machines and movement II) Principle of the means that regulates the action of the forces on the machines and the transmission of the speeds with a determined ratio; III) Calculation of the passive resistances of the pieces in uniform movement, under sensibly invariable actions.

IV) Influence of the variations of the velocities on the resistances;

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H Research Edition. ISSN 2532-5612. Publication 2019-20,04 Division edition Group HTNET www.htnetEdition.eu

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19) Year 1874 -- Libraio Editore Napoli in via Roma, and in Milan - Naples, Milan; FINBC, A XXIII B 20; F. Reuleaux -- General machines theory -- (p. 539) From the timbre on the first text sheet, the original location is visible: Library of the Royal School of Application of Naples.

F. Reuleaux, author of the text, director of the Berlin school; Giuseppe Colombo, professor of the Istituto Superiore di Milano.

This treatise by F. Reuleaux, the founder of modern kinematics, represents a milestone in applied kinematics. Already at the time of its publication in German it was recognized its importance, so much so that it was immediately translated into Italian, in Russian and, shortly thereafter, in French. Even today, the kinematics uses concepts developed in this work, as well as the terminology.

Given the importance assumed by this author in the Mechanics Applied to the Machines it seemed appropriate to fully report the long preface of this work, as the author makes a review of the studies of kinematics hitherto existing indicating the critical aspects.

INDEX ARGUMENTS: I)

General ideas 1) General laws of motion and balance of bodies 2) Limits of the problem of mechanics 3) The Machine science 4) General solution of the problem of machines

II)

Feronomy theorem 1) Preliminary considerations 2) Relative movement in a plane 3) Momentary rotation center or pole, polar polygon 4) Polar trajectories, cylindrical rolling 5) Tracing of the polar trajectories 6) Rotation around a point 7) Conical rolling

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8) General expression of the relative movement of solid bodies 9) Roteation and rolling of surfaces rifled III)

Pairs of elements 1) Different kinds of element pairs 2) Determination of the matching pairs 3) Of the movements of the matching pairs 4) Necessary and sufficient support of the elements 5) Support against transport 6) Support against rotation 7) Contemporary support against rotation and transport 8) Upper pairs of elements 9) The bi-angle archilineum in the triangle 10) Trajectories of the points of the archiline bi-angle with respect to the equilateral triangle 11) Trajectories of the points of the triangle with respect to the archiline bi-angle 12) Figures of constant width 13) The equililateral archiline triangle in the rhombus 14) Trajectories of the points of the archiline triangle with respect to the square 15) Trajectories of the points of the square with respect to the archiline triangle 16) Other archiline disks of constant width 17) General determination of the profiles of the elements, given the law of movement 18) First process. Research for the profile corresponding to another arbitrarily chosen profile 19) Second process. Auxiliary polar trajectories 20) Third process. Secondary polar trajectories considered to be generating profiles

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21) Fourth process. The trajectories of the points of the elements used as profiles 22) Quinto processo Paralleli ed equidistanti ai rotoli utilizzati come profili 23) Sixth process. Approximate tracing by means of circle arcs.

Willis method 24) Seventh process. The polar trajectories themselves used as profiles 25) Generalization of the processes so far considered.

IV)

Couples of non-independent elements 1) Closures of the couples through sensitive forces 2) axial movement to forces closing 3) Kinematic dactyl elements 4) The Springs 5) Closures of element pairs through the kinematic chain 6) Complete kinematic closure of the ductile elements

V)

Non-independent kinematical chains 1) Dead spots in the mechanisms. Way to separate them by sensitive forces 2) Dead center passage by couple closure 3) Closure of the kinematic chains by means of pairs for elements

VI)

A look at the history of machine development 1) Origin and progress of the machines 2) Kinematic principle of the improvement of the machines 3) Development of the modern machine 4) Impelling motives to the development of the machines

VII)

Kinematic symbolic language 1) Need for a symbolic language in kinematics 2) Language attempts made up to now 3) Different kinds of symbols to be adopted 4) Species symbols

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5) Shape symbols 6) Relationship symbols 7) Notation of kinematic chains and simple mechanisms 8) Abbreviated writing 9) Writing of composite chains 10) Notation of chains with pressure organs 11) Concentrated notation of individual mechanisms VIII) Cinemantic analysis 1) Purpose of the kinematic analysis 2) Couples called simple machines 3) The quadrilateral with a cylindrical crank 4) The parallel cranks 5) The antiparallel cranks 6) The chain of the cylindrical thrust crank 7) The isosceles crank chain 8) Extension of the pins in the chain of the thrust crank 9) The cross-shaped glyph chain 10) The chain of the crank of thrust, deflected 11) Summary of the cylindrical crank mechanisms 12) The quadrilateral with a conical crank 13) Decrease in the number of members of a kinematic chain 14) Increase of the numbers of a kinematic chain IX)

Analysis of crank capsulism 1) Concatenation of crank mechanisms with pressure organs 2) Crank-shaped capsulism deriving from the rotary push handle 3) Crank-shaped capsulism deriving from the isosceles rotary crank handle 4) Crank-shaped capsulism deriving from the oscillating glyph crank 5) Crank-shaped capsulism deriving from the rotary glyph crank

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6) Crank-shaped capsulism deriving from the oscillating thrust crank 7) Crank-shaped capsulism deriving from the rotary cross glyph crank 8) Crank-shaped capsulism deriving from the rotary cross glyph 9) Crank-shaped capsulism deriving from the rotary handle with an archilinear thrust 10) Crank-shaped capsulism deriving from the double rotary crank 11) Capsulism deriving from conical mechanisms 12) Capsulism deriving from the rotary cross joint crank 13) Capsulism deriving from the oscillating joint 14) Capsulism deriving from the rotary cross joint 15) Capsulism deriving from the oscillating joint 16) A glance in the results previously obtained

X)

Analysis of the constructive elements of the machines

XI)

Analysis of the constructive elements of the machines 1) Composition of the machines by means of construction elements 2) Screws and screw connections 3) Biette and connections to biette 4) Nails and riveting, hot connections 5) Pins, axles, trees 6) Couplings 7) Supports, chairs, castles 8) Ropes, straps and chains 9) Clutch wheels, belt and rope transmissions 10)Toothed wheels, chain wheels 11)Steering wheels 12)Levers, cranks, connecting rods 13)Crossbars, or crossed heads, and guides

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14)Wheels of stop and pawls 15)Retrograde movement in flowing stops 16)Arpioni 17)Brakes 18)Grafts 19)Summary of engine start-up and stop methods 20)Tubes, steam and pump cylinders, plungers and boxes to tow 21)Valves 22)Springs considered as machine elements 23)Consequences of the previous analysis XII)

Analysis of the complete machine 1) Current dominant ideas 2) The operator 3) Kinematic meaning of the operator 4) The receiver 5) Kinematic meaning of the complete machine 6) Driving machines and operating machines 7) The special arts of the complete machine. Descriptive analysis 8) Examples of descriptive analysis of complete machines 9) Meaning of the machine for society PREFACE:

The following considerations are intended to discuss the various aspects under which machines are generally presented in order to determine, among many, the real point of view from which one must study. We therefore understand them: Basic principles of a general theory of machines. The science of the composition of the machines, or kinematics, is divided into two parts, theory and applied. Now it is the theoretical part that forms the object of this publication; it only deals with establishing the principles that serve as a basis for the applications of science; and differs essentially, in large part, from the commonly accepted theories. Being purely theoretical research, I should seem to count only on the interest of people of science. However, theory and practice are not antitheses, as often tacitly assumed; the theory, when the real practice is wandering in a field disclosed by science, it is not necessarily contrary to the practice, nor practice at the theory, although this may sometimes happen, it can only agree with the theory, if the latter is exact. The axiom, so popular, of the antagonism between empiricism and theory; it will always remain; and the greater the progress of the theory, the more earthly the empirical processes will lose in their struggle with theoretical methods. To these methods the practical instructor and lover of progress can never remain

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indifferent; nevertheless it can happen that he maintains for some time on the reserve. But the theoretical questions in question are of such nature that they forcefully impose themselves; I therefore have the hope that, in addition to theoretical specialists, even practical ones will want to take an interest in this new direction; and I feel the duty towards both of them to explain to them the reasons for which I have abandoned the ways of seeing so far in use and I have believed I must replace you with others. Attempting to merge the science of machine composition on new foundations, I do so in the belief that this is worth it, if it leads to a real advantage in the study of machines. Now I think I can safely promise. Whoever has understood a machine better, who has penetrated more deeply into his inner essence, is more able to profit from it.

Here it is not just a matter of giving a new form to principles already known and discussed, nor of substituting new subdivisions and new nomenclatures to the ancient ones. Perhaps with such modifications it will be possible to treat the matter with greater ease or elegance; but for practical use one can still use the known methods for a long time.

No: the new theory, if it wants to pretend to arouse general interest, must provide the possibility of producing something new: it must make soluble the problems that so far with the systematic methods have remained absolute.

Now we can say that this will happen when it succeeds in giving a truly scientific form to the kinematics of machines, even in its simplest propositions. Actually, in a certain sense, this subject has also been dealt with up to now in a scientific way, that is to say limited to those parts that presented themselves to mathematical analysis. Only this happened as we said, for some parts, but not for complex and much less regarding the intimate existence of the subject: the theoretical nature of the treatment is a simple matter of mathematics or mechanics, but not of kinematics. The latter has remained, in its substance and in its fundamental principles, still inexplicated and only by chance can it be cleared in some special point. It can be compared to a tree which, grown up in a tower, pushed its branches as far as it could; where they have been able to soak in air and light, they are leafy and flourishing; but the trunk bears nothing but twigs and wilted germs. The mathematical analysis searches, with all the apparatus of scientific means, the properties of a given mechanism; and in this sense it has accumulated a rich material, which later will not only be useful, but will even increase in value. However what has not yet been studied and the other side, the most important side of the problem, that is to say the question, is unmistakable: How did you get to the mechanism and its elements? What is the law that governs the process by which the mechanism is combined? is it first of all starting a law for similar processes? Or one must simply accept what inventive genius presents to us and therefore it is not for science to analyze what it has found, in the same way that we proceed in natural history. So far this system of attempts has been exclusively followed: to penetrate further, behind the scenes, there are only traces.

In consequence, in the study of machines, we came to this singular result that we worked with great resources around the products of the inventive faculty of man, that is of thought, without knowing the process by which thought itself created them. Because of this strange consequence, which would not easily be admitted in other branches of exact science, it happens that even if it does not know how to say openly, it is also tacitly acknowledged that the inventive faculty is a kind of divination, the result of a higher inspiration. There is a certain respect for a person when it is said that he has invented such or such a machine. When we must study or teach the thing without another at the process of its creation.

When, for example, we take into consideration, according to the methods used so far, the well-known parallelogram that Watt invented for his steam engine, or those of Evans, Reichenbach, etc. we find nothing else to do after having classified them, than to look for the laws of the movement to which these mechanisms obey, to determine the best

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method to build them, and at most, to establish their mutual relations. As we then leave in discussion, despite the interest that it may arouse. We try, it is true, to spy on the genius in the depths of his thought, but we do it rather out of curiosity than through study. Yet it would seem, from what was said, that we might venture another step that would be of essential importance. Tentiamolo. Watt left us, in some of his letters, some clues over the mental process that led him to design the parallelogram. The idea, he writes, he was born in November 1805 to his son in the following way. Having found that the double chain, the toothed arch and the 'false teeth' were improper means of transmitting the movement of the plunger rod to the barbell, I set myself to find if it were not possible to succeed by means of movements around axles; and, after some time, it occurred to me that, if AB and CD cone two equal arms oscillating at the centers B and C and assembled with an AD rod, they could deviate, in their movement along arcs of a certain length equal and in the sense contrary to the straight line, and that therefore point E would describe an almost straight line; as well, if, for convenience, the CD arm were to be half shorter than the AB, the same result would be obtained by bringing the point E more towards D.

Fig. 12 From here originated the construction that was later called the parallelogram. Although I am not excessively vain, I am also more proud of my parallelogram than of any other mechanical invention I have made.

Although this letter is interesting, even if it is examined closely, it mystifies us, as must have mystified the one to whom it was directed. We learn, it is true, the reason and some results of the research done, but we can not discover the method followed. Where we also consider that this narration is made 24 years after the invention, and that therefore, in the natural confusion between reflection and remembrances, it could not accurately reproduce the original concept. Much more naturally, Watt expresses himself in an original letter. Much more naturally Watt expresses himself in a letter Boulton in 1874, in which he communicates his first idea; I have made a new idea, he writes: The idea of a method was born, by means of which the rod of a piston can be vertically directed in its reciprocating movement, only by attaching it to a piece of iron on the barbell, without chains , without vertical guides, without sectors or other heavy pieces at the head of the barbell, without considerable friction. With this arrangement, when it responds entirely to my expectation, you can save 5 feet in height in an 8-foot running car, which is important to me; and it may very well serve both single-effect machines and double-effect machines. I have done as a test a small model, but it did not yet work for the construction .. no less do not say anything until I have the patent. If one now examines the description attached to the patent, there are no less than six straight-motion guide systems, including vertical guides, sectors, etc. in that letter condemned; two of these systems refer to the two different forms that the mechanism can take. It is regrettable that one of the six systems, which conduct the true parallelogram of Watt, has not been able to take advantage of it; it escaped completely afterwards, which is understandable when one thinks of that coarse set of wooden beams and pieces of iron, roughly beaten, which then

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had to constitute an elegant mechanism. We see that even a thinker like Watt can not explain the true primitive concept of his invention. But we observe, however, that in the crowd of ideas that must to be present to the mind of the inventor a concept always takes place from above progressively. Success inspires us so much more esteem as the inventor proceeded in a completely virgin field. But we find no trace of divination, of sudden inspiration; after some time I fell into my mind the words of the inventor; and they clearly demonstrate that the invention must have proceeded from uninterrupted research, from a continuous application of thought. Newton to those who asked him how he came to the law from universal gravitation, he replied: I continued to think of it without interruption. Even GÊthe has been able to effectively express this idea with the phrase: What is invention is the result of what you are looking for. Certainly the links linking the successive concepts of the inventor with us are almost entirely hidden: we must first reconstruct them . The whole appears to us like a picture that has just been sketched or already canceled halfway; and the painter himself could barely give better reason than what we ourselves could do. The comparison is indeed appropriate in more than one point. In every new field open to the creative faculty of the spirit, the inventor proceeds like the artist. With a light foot the genius hovers over the airplanes buildings that he, on new foundations, goes hand in hand in his mind. Inventors and artists are sometimes not allowed to ask about the life they have traveled. Similar considerations to previous ones can be made on the history of secular inventions, where one sees the thought of entire generations occupied in some new research. The invention of the steam engine, for example, lasted a century, without making further progress except those allowed by the contemporary development of the physical sciences. with the school of Gallico, when the laws of the fall of the grave were the ray of light that tore the school mists spread over all the sciences, at the beginning of the seventeenth century, the method of observation began, with the progress of which is closely linked the invention, with the progress of which the invention of the steam engine is closely connected. It is not by chance that it was born where art had reached such an eminent development; because in a fertile soil, art and science flourish together. It would almost seem that the Pisans had built their marble tower out of their squarely for Galileo's experiences of falling bodies. In Florence in 1643, Torricelli, a pupil of Galileo, young but mature in age, discovers the weight of the atmosphere: at the moment rises a battle, a universal clamor to save the horror of the void and with it the science in wig threatened by the foundations. The center of gravity of the controversy and of the new research is carried out in 1646 by Tuscany in France, where Pascal examines the issue and after a short time passes in the field of innovators. He made on the Puy-de-Dòme in 1648 the first and memorable experience of measuring the heights with the barometer: it was decisive and the bells of Munster and Osnabruk celebrated the triumph of the young science. Later the geographic line traveled by the center of activity of the new science takes place to the north-west, to Germany, in the country of electors. The Tilly could not destroy the life of the spirit in Magdeburg. Here Otto di Guerieke introduces, in 1630, a new element in the question of the day, that is the force that corresponds to atmospheric pressure. He demonstrates this in a scientific and popular way with the pneumatic machine and other devices of experience. From all the parts the means are sought to use, with the formation of the vuto, the powerful pressure that exerts the atmosphere. for a long time you do not succeed: in the end, in 1696, the solution is found by Papin in Marburg: the condensation, that is, of water vapor in a cylinder with a plunger. The steam engine, was invented, Papin, a true scientist who, tending the problem in very different ways, was the author of the steam engine. But his machine was still very imperfect and impractical: the fruitful principle that had created it needed to go from the theoretical field and the Latin treatises in real life. Papin, too nsecure, was unable to do it; he did not succeed in his first attempts, and his large steam cylinder still remains incomplete, like a monument, in the courtyard of the Cassel museum. But his concept passed beyond the Machine in England where he immediately entered the practical field. Neurcomen and Cawley, two workers,

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make a practical machine in 1705 of the Papin apparatus, turn it into a steam pump and apply it successfully to the mines service.

The inventive spirit, however, rests after that era, exhausted as it was after the effort of the previous years. Indeed, rest was inevitable, because scientific materials were lacking to progress. Too little was known of heat, this indispensable agent; we could not even measure it. First of all it was necessary to perfect the thermometer, that thermodynamics would make an essential progress. Then appears Watt, around 1763, with his overbearing genius, which leads to the highest degree of perfection the steam engine, surrounds it with a series of mechanical and kinematic inventions and at the same time enriches the branches of science that relate. From then on, the applications and improvements of the machine extend and follow each other without pause, with the help of a thousand intelligences and thousand hands, up to nowadays in which it can be said to be perfect and it becomes the property of all. In these few steps I have been silent about everything that Hombold calls the deaf struggle of the right to property. One could almost induce from this summary magazine that the development of ideas was naturally made by itself, where the sudden progress made after long intervals did not reveal the action of superior spirits and did not convince us more and more of the influence of genius in refinement of human culture. At the same time, however, we see an idea developing from the other, like the leaf from the germ, the fruit from the flower, precisely as the elements that prepared it. I believe I have shown in the foregoing that in every invention there is always a logical progression, more or less apparent, of ideas. At least it is apparent, how much the higher we place the inventor in our admiration; and these, in fact, deserve much greater appreciation, at least material, as less aid has been found available. Nowadays, in which the technician has undergone such a great mass of scientific means, progress is frequently made which are, in absolute terms, of the greatest importance; they are not as much appreciated as they were in previous ages. All of this is within our reach in the simplest and most natural world, and even mediocre spirits can understand and create. But the important inventions in relative line, allowed that to the superior spirits, they also have a far greater scope than before, and this explains the almost feverish development to which we now assist in the technical field. It is the consequence not of a more robust creative power of our generation, but of the improvement and diffusion of the instruments of intelligence. These, like the tools of modern mechanical workshops, are in a thousand ways increased: the men, who work with them, have remained the same.

Let us now return to the subject proposed to us and examine historically more closely what has been done so far in theoretical kinematics. I do not fear the reader that I want to raise the dust from the old sheets here, to build the foundation of a new science on dry land. We will merely try to follow the first steps of thought in the subject that deals with it; but in this research we will not have to stop the quiet of the ancient volumes. Once one considered each machine as a whole, made up of the organs that were its own; those groups of organs we call mechanisms escaped entirely to the scientist's eye, or were barely glimpsed. A mill was a mill, a pile, a pile, and nothing else.

This is why each machine is described from the beginning to the end in the oldest books. Thus, for example, in 1588 Ramelli describes several pumps driven by hydraulic wheels, as if they were always new things, from the wheel motor channel, or even from the river, to the pump outflow tube. The concept, hydraulic wheel, is certainly quite apparent, similar wheels are found everywhere; only the idea of the pump and therefore also the word that denotes it is still missing completely. In reality, in order to ascend from the details of an object to a general concept, a certain work of thought must precede it: it is precisely what distinguishes the scientific progress of the thought of the common process. For the first time in 1724 we find the Leupold a distinction between individual mechanisms and machines, which are studied for themselves and only in terms of their different applications. Further on, thought does not extend yet. This is explained by the fact that at that time machines had not yet been consecrated a special

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division of science; it still fell into the domain of physics, taken in the broadest sense. The first polytechnic school in Paris is founded, in 1794 and we see the division, already begun previously, between the theory of mechanisms and the general theory of machines. This division ties up to the famous names of Monge and Carnet. The new branch of science appears as a subdivision of the Descriptive Geometry, to which, however, it gradually escapes from hand.

Behind the traces provided by Monge, Hachette, called to this teaching, it designs and then in 1806 begins to carry out a program, which in 1808 Lanz and Bétancourt complete in their Essai sur la composition des machines. Monge had designated the means of transforming the movement as elements of machines. Under this name of means he meant mechanisms, and from this point of view he founded the classification of mechanisms on the possible combinations of four elementary modes of movement, ie continuous and alternative rectilinear, and continuous and alternative circular. As a result, ignoring the repetitions, the following ten classes, containing the mechanisms for the transformation of the movement segments: Rectilinear continuous in continuous rectilinear, alternative rectilinear, continuous circular, alternative circular. Continuous circular in alternate straight, continuous circular, alternative circular. Alternative straight line in alternative straight line, alternative circular. This scheme or system as one wishes to call it, can be extended, and it was in fact in the 2nd edition of 1819 with the introduction of other elementary movements, that is of the continuous and alternative curvilinear movement, which gives rise to 21 classes instead of twenty . But the principle is not changed point; and it continued to be, with minor modifications, generally applied until today and had the sanction of universal approval. Hàchette himself, who had collaborated in the work of Lanz, also accepted this system unconditionally in his Traité élèmentaire des machines appeared for the first time in 1811. Borgnis in his Trite complet de mècanique 1818 is less satisfied with it, in fact in a sense he moves away from it; he treats the argument in a more general way than his predecessors and proposes a division of the machine organs into six classes. They are the receivers, the communicators, the modifiers, the supports, the regulators and the operators. He does not care to consider transformations as a fundamental principle, but he preferably uses them for subdivisions. Moreover, his system has never been considered as opposed to that of Monge; its classification appears rather destined to the general theory of machines and more or less appropriate for it. Some distinctions of the Borgnis scheme entered the public domain: they are those of receiver, transmission and operator, which from the splendid works of Coriolis and Poncelet were erected to fundamental columns, almost to articles of faith of the modern machine theory. At this point I must already note, even in danger of being suspected of heresy, that these fundamental principles of machine theory need to be essentially modified. May the venerable Nestor of applied mechanics forgive me: "Amicus Plate, sed magis amica veritas". We will then provide the means to examine these fundamental principles. But it is already evident that such principles can not fall outside the field of mechanism theory, since they have such an important part in the study of the movements of the original machines. Borgnis' work is out of order; his classifications of machines and their organs have brought little fruit: they offer the reader little more than a passably ordered scientific work. Yet we will see later on that underneath some of the principles containing it there is more than one has ever believed to find there. The 1830 marks a noticeable change of direction in the theory of mechanisms, whose fundamental principles underwent for the first time a critical examination, in a more philosophical sense, by the famous physicist Ampèrè places the science created by Monge and Carnet in the rank of the sciences third-order system in its scientific classification system and establishes its boundaries. He takes his starting point from Lanzai's Essai and observes: it (this science) must not define, as has always been done, a machine as an instrument through which one can change the direction and intensity of a given force; but rather as an instrument, with which the direction and speed of a given movement can be changed. He would like to banish the name of force in all the considerations that refer to it, and continues: To this

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science, in which the movements are considered for themselves, in the same way that we examine them on the bodies that surround us and especially in those devices that we call machines, I gave the name of Kinematics from the Greek Kivηuα (movement). He makes vows for this science to be the object of special treatises, from which he promises himself the most useful results: but he himself has not gone further. Ampère's appeal was not sterile, since in France the kinematics was introduced in many institutes as a separate course, and the bibliography of this subject soon became very rich. The name proposed by Ampère found in France the most favorable reception and even outside it became more or less familiar. However, the light was not yet made, neither on the scientific delimitation of the subject, nor on its true address. The largest and most original work published later was the treatise of Willis, Principles of Mechanisms, an excellent book published after 1840, full of examples taken from applied kinematics and new ideas about their intimate relationships. Willis moves away from the Monge system; he observes that the outline of Lanzai's Essai, which is at odds with its scientific appearance, is nevertheless a popular classification. In Lanz and Betancourt he finds a contradiction with the definition of Ampère, as they have included in the Ampere category, as they have included in the category of mechanisms hydraulic wheels, windmills, etc. while he would like to consider as pure mechanisms only those that are formed of solid bodies. He emphasizes his own essential that these mechanisms have to change both in size and in the direction of the relationship of the movements that take place in the machines to actually determine, even in size and direction, these movements, according to the concept of Monge. As these properties are both constant, or both variables, the mechanisms fall into the corresponding class of the three, in which Willis divides them and which in turn include some subdivisions according to the nature of the means used for the transmission of the movement. In Willis's considerations, which in any case bear the imprint of an acute spirit and an investigator, there is much truth; but there are also many more things it is a remarkable fact that the classification of Willis has not thrown into his own homeland, which indeed gradually fell back into the path traced by Lanz, preserving himself until the present. Also in Italy the seed thrown by Ampère has brought excellent results. Giulio0 has linked to his homeland a precious legacy in his Kinematics applied to the arts, a manual for technical schools and published for the first time in 1847 under a different title. The author recreates the kinematics of mechanics with great talent; after all, he follows the Willis almost faithfully, not without trying to readmit the hydraulic machines he has excluded: an attempt, which has only an incomplete success. There is a hint throughout the book, a spirit so far, all the more worthy of observation, since the book supposes in readers only an elementary mathematical culture expression of what many books reveal, in which the devices of the mathematical machine are noisily worked. In 1949 Laboulaye also responded to Ampère's appeal, and in his Cinematique he began to lay the theory of mechanisms on solid foundations. He decisively rejects the principle of Willis to limit himself only to the mechanisms formed of solid bodies, and shows how Ampère asked when he wanted to categorically exclude forces from the kinematics. In addition, he starts from new and more general bases, dividing the elements of the machines into three classes he calls: lever system, lathe system, plan system according to which one, two or three or more points of a moving body are maintained properties. These systems do not answer the question, and we will try it at the right time; their own author could not make any truly decisive application, feeling without a doubt that they were too inadequate: on the contrary, he returned again in the applied kinematics, to the Lanz scheme with appropriate subdivisions. He goes along, which aims to reconstruct a priori the classification of Monge and to show that it is the true and essential basis of everything. With these philosophical researches, Laboulaye has not rendered any service to the theoretical kinematics: indeed the apparently convincing form of the reasoning members has diverted others from further research in this sense. This a priori reconstruction can be applied to the movement of a point but not to the movement of a body or points system. Laboulaye's book is indeed very practical, and without any doubt

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contributing to the diffusion of many useful cognitions, in the practical part it nonetheless retains to a large extent the most diligent work of Willis, of which he even reproduces errors. Also Morin has assembled in a small volume (1851), destined for elementary teaching, the fundamental principles of kinematics: in the later editions this operetta was published under modern appearances, it is written in a very rational way and contains several excellent fundamental ideas; overall, however, it complies with the Monge scheme. In the period of time, which we have discussed so far, nothing can be said in Germany for the progress of theoretical kinematics. Weisbach, in his article: in the encyclopedia of Hulsse 1841 follow the classification of Lanz, his extensive scientific activity had taken, as is well known a quite different direction. Something new could be expected from Redtenbacher, who had also been busy with the mechanisms for a long time. In fact, with his eminent philosophical intelligence he became aware of the defects of the Monge system; but absent-minded at first of the studies on the construction of the machines, for which he created a special branch of science, later by his work on mechanical physics, he dismissed the system, but did not replace anything new. He issued the opinion that a rational classification of mechanisms was not possible and that they should rather be ordered according to their practical application, following in all the rest, as is natural, mathematical procedures. We can see traces of this opinion in the valuable work of Redtenbacher (1857) in which it describes the collection of kinematic models of the school of Caslsruhe, and makes it the theory. This work, although not systematic, is also very widespread in Germany; which demonstrates the keen interest that technicians of this country attach to theoretical research on this subject. Meanwhile, in France, in the field of geometry, an important movement had been produced due to the influence it had on the development of the kinematics. Chasles, and above all Poinsot, resumed and further developed the method, already adopted by Euler in the last century, to study the movement of solids from the geometric point of view. The Rotation Theory of Poinsot's bodies and his Thèorie des comès circulaires roulants gave a strong impetus to the introduction of geometric methods in the study of mechanisms. Euler's theorems, which until then had been considered as interesting only from the theoretical point of view, became, by the French authors, fundamental theorems of great importance. They infused new life into this science, which has become almost stationary. In this order of ideas the Elements de géométrie appliquèe à la transformation du mouvement of Girault (1858), the Cinèmatique of Bélanger (1864) and the Traitè des mècanismes of Haton (1864); in the first two the theoretical geometric part is especially developed, in the last one we try to apply the theory to the study of the mechanisms. Although these books are all valuable and important, when they come down in the field of applications they do not know how to overcome the old difficulty of classification. All three deviate from that of Monge, since the insufficiency of the old system seemed too obvious, considering in the light of new ideas; however, everyone draws on it with a more or less happy outcome. They present considerable divergences from one another and oscillate between Mongue and Willis, but always with some variations. Girault and Bélanger base their classifications on the nature of the transformation of movement, which each considers different aspects; the different transmission means then form the object of as many subdivisions; Bélanger is based, like Willis, on the SPEED REPORTS. Haton recognizes the defects of the old system and shows, for example, how in it, to classify the toothed wheels rationally, they should be distributed in each of the 21 classes of mechanisms; he takes the downside, and takes the nature of the means of transmission as the basis of his classification. It thus succeeds in forming nine classes, of which the first six are: the rollers, the guides, the eccentrics, the toothed wheels, the connecting rods and the belts; the last three are united under the fatal name of appareils accessories. What a third part of the whole subject is like is a footnote added to it. This new trend, which gave rise to other works that we will pass in silence, has not therefore led to unify the kinematics under a single concept. The uncertainty that prevailed in this subject had a bad influence in France. The authors inclined towards the theory were persuaded that in the field

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of applications there was nothing to be done. They divided the nihilism of Redtenbacher on this subject; and thus the division of pure kinematics was born from the applied kinematics. This tendency is due to the book by Resal, Cinematique pure, which shows how, following this path, the problems of kinematics are necessarily transformed into problems of pure mechanics. Another fruit of this uncertainty was a new special branch of science that tried to make its way and that deserves to be mentioned; this is the so-called automatic, that is the theory of the way to realize through mechanisms of the relations of motion expressed by means of mathematical formulas. This attempt to establish a new branch of science is due to engineer E. Stamm; he maintains the division of pure and applied kinematics, and adds a new subdivision: the automatic (Essai sur l'automatique pure, 1863). Stamm has acquired a real merit for his studies on a special issue of kinematics, ie the kinematics of the automatic spinning machine (Selfavting); merit that spinning specialists know how to appreciate now. His attempt to do, of the automatic, a separate science, however, can not be considered practical, because in reality it can not exist alone; it is only a part of the synthetic processes that are based on the theorems of kinematics, and therefore is inseparable from this science. We have reached the end of our literary magazine. On the one hand, we have found only an unsatisfactory confusion of attempts always circumventing in the same circle of ideas; how many are the authors, but the opposite is tested and tried again; and in the end, after having accumulated so much scientific material, it is possible to conclude the science, whose limits were traced by Ampère, in two, even in four different sciences; as if it were one of those infusoria that propagate by splitting. On the other hand, however, we must make this consoling observation that the prevailing ideas gradually acquire in time, in sharpness and precision, as well as that the research methods, like the mechanisms studied, have subsequently grown in number. The two sides of the question, the theoretical and the practical, continued to be considered separately, without ever merging the theory with practice. The cause of all this must be sought only in the systems, since the applications themselves, the mechanisms themselves have been perfected and increased in practice through new inventions, without suffering for the lack of a safe and reliable theory. The theories that have existed until now have not contributed to this development, except for the forms of some organs, for example gear teeth, etc.; no new mechanism owes its origin to any theory. This circumstance is worthy of consideration; it gives the reason for the tenacity with which the practical ones, even when they take into account the theoretical results, always fall, despite the opportunity presented by so many new theories, in Monge's old theory which seems to them the most natural of them all. This fact is proved by the technical journals of each country. I believe thereby that I felt the need for reform. It is now a question of knowing in what is properly the weak point of the theoretical ideas prevailing up to now. In the first place, the classification of Monge, however natural it may seem, is not appropriate to the essence of the subject. If it were, as are the classifications of Linnaeus and Cuvier of the organic kingdoms of nature, he would be able to take root, as these did Linnaeus and Cuvier. After all, the tenacity with which the practitioners adhere to it, comes precisely from the confused idea that it is founded on the nature of things. But in fact it is not so. Supposed also that everything must be reduced to the distribution of the mechanisms in various classes, the division based on the nature of the transformations of movement, must however be rejected, because it draws infinite repetitions. Almost all the mechanisms belong to at least two, the most from four to six and even to ten and fifteen classes; for in fact they can be used, and they are actually in practice, for such a number of transformations in movement. The Willis, very severe towards himself, shows himself persuaded by the need for rational distribution, but on the other hand he gives so little confidence in the solidity of the principle he took as a basis for his classification,that this is very little based on the classification, that this is very little persuasive. Since he wishes to adhere strictly to the principle of speed relations, he is obliged to place very different mechanisms alongside one another. And since on the other hand many mechanisms can serve to

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obtain different speed ratios, it is also obliged to introduce many repetitions. Other objections can be raised against the classifications of Laboulaye, Girault, BĂŠlanger, Haton, etc., both in general and in particular, since a true science can not be allowed to act arbitrarily in six or eight ways. The reason therefore of the inadequacy of the various systems is to be found not in the classifications themselves but in something deeper. It depends, as already indicated, on the fact that no one knew how to go back far enough back to principles, to primitive ideas; it began to classify without having analyzed the objects of classification very intimately enough. In forming a science it is not allowed to enter directly into the heart of the subject, but it is necessary, following the example of mathematics, to go back to the simplest principles, based on axioms. This will be clearly seen, examining how one proceeds in a particular case with ordinary methods. For example, we began by considering the transformation of a rectilinear movement into another straight one, without asking ourselves what the origin of this first rectilinear movement was, how it had taken place and how it was produced. To cite a particular case, Hachette and Lanz deal first with the so-called fixed pulley. The rectilinear movement of the descending cable section is, they say, transformed into another straight pure movement of the that rises cable section. But what we do not learn is why the first movement is straight. Nor is it true that this movement must necessarily be so, since it is perfectly possible to stretch the descending cable section in any dissent, without in any way altering the nature of the mechanism, provided that the rope always remains taut.

On the other hand, the movement of the descending rope is transformed first into the circular movement of the points of the pulley and of the small section which embraces it, and only later in the movement of the rising section.

So even the first problem goes out of the limits traced in the scheme. The movement of the stretch of rope that rises is as indeterminate as that of the descending stretch; one can therefore see how many inaccuracies are already accumulated in the first example. We observe in passing that the study of this mechanism requires very complicated theoretical considerations, as we will show later in the text. It often happens that a very simple mechanism can not be properly studied, if not by means of complicated considerations; sometimes the opposite also happens. But, in any case, to understand and study scientifically even the simplest apparatus, one should not neglect to cover the whole series of more general ideas from which they derive, so as to arrive at establishing truly general theorems.

Although this seems difficult and also not very useful at first glance, it is nonetheless indispensable; having neglected to do so is the reason why none of the theories proposed so far by the various authors has managed to take hold. All have so far been limited to doing what I have already shown to be erroneous, to deal with simple or apparently such mechanisms, which came out of the inventor's hands, whether it be a known inventor, or a losing tradition in the darkness of history. The examination of these obscure traditions offers the scholar of the kinematics subject of singular considerations. I must restrain myself for now from developing this attractive subject more widely, which I will do more extensively later; I do not want to omit an observation, however. In historical times, in which we can trace up to the first origin of the invention of machines, we find applied in different places mechanisms of different nature, which include both quite complicated machines and simpler arrangements that just deserve the machine name. This is not the place to discuss which criterion is convenient for judging the difficulties which their inventors had to overcome; it is enough to indicate that they appear in different places independent of each other. Among these primitive machines are, for example, the rollers, through which the Egyptian builders transcribed their monoliths; the Egyptians, the Babylonians and the Indians had wagons of wood and metal, for transport and for war, since time immemorial; the water wheels were in use in ancient Mesopotamia and in Egypt, as well as in China, India and Central Asia; the toothed wheels were known to the Greeks; as well as the screw, the size and some lever mechanisms, etc. Some of these inventions were transmitted to these peoples by tradition, others originated in the very ground where we rebuilt them and where they had already been preceded by the necessary

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preliminary knowledge. All were the product of the inventive faculty of man, and sometimes they were so ingenious, that they regarded themselves as a gift from the gods. But they are always the result of laborious studies, but they are due to a process of thought that only gradually reaches the goal. It follows that even today such mechanisms should be found again by means of the same procedure. This is the task that the theoretical kinematics in which I propose first of all. Until it arrives to analyze in this way the elements and the mechanisms of the machines, even without the help of the history of inventions, it can not pretend to the name that a vulgar empiricism, which struts in clothes taken away from other sciences. Only when, after a convenient choice of the way forward, will know how to provide the means to achieve movements of a determined nature, will begin to deserve the name of science. The classification will then follow by itself without difficulty. It will know how to turn the question of transforming one movement into another and judging itself, if and that value has a similar classification principle for it. Since every true science will know how to find its laws in itself, it will not need a legislator to impose it on them.

Thus we arrive at another important and remarkable conclusion. If the thought processes that lead us to the formation of the known mechanisms are exact, they must also be further applicable in similar cases; they must also contain within themselves the means by which we can come to the discovery of new mechanisms, they must in some ways replace the inventive faculty in the sense that is given to it today. I hope that I will not be suspected of falling into vulgarity, as if I said that, with this recipe of mine in my hands, every mind, however mediocre, may henceforth rise to the rank of an inventor genius. On the contrary, I limit myself to asserting that in the study of the problem of machines we can introduce those same operations of the intelligence that are applied in other scientific researches. More over, I have tried to show that the inventor is only the result of reflection, so that if we succeed in giving thought the most appropriate address to our subject, we will also open the way to invention. Goethe, who has always been interested in discovering the processes by which man reaches to widen the field of his own ideas, expresses himself in this regard with the following sentence in the highest sense of the word, it is only the result of a feeling of the truth that has been hidden for a long time in us, and which, unexpectedly, leads us unexpectedly to the conquest of useful knowledge. Here's how Schopenauer, developing, as many times Goethe's idea happens to him, is expressed on a very similar subject. Our best, deepest and most fruitful ideas of him sometimes appear to us all of a sudden before the mind as an inspiration and often in the form of axiom. Evidently, however, they are only the result of long and innovative meditations, of considerations that are often very remote or partly forgotten. It is very rare that the whole process from our intellect is clearly describable, that is, it consists in concatenations of clearly conceived judgments; it is this but the purpose we aim to be able to give an account to ourselves and to others; ordinarily, however, the impressions received from outside are elaborated in our interior, until the thoughts that come from it appear clear to our mind; and we are just as unconscious of this process as it is of labor that assimilates food to the honors and substance of our body. It follows that sometimes we ourselves do not know how to explain the origin of our deepest thoughts; they are the mysterious product of the innermost latebrees of our soul, from which unexpectedly arise judgments, ideas, resolutions, of which we ourselves are astonished. The conditions that must proceed with the invention of a mechanism can, however, as we said earlier, reduce to an orderly concatenation of ideas that entitles the purpose, as well as in mathematics a series of clear and well-linked judgments lead to the result the final. For those familiar with mathematical theories, the invention of a mechanism is reduced to a synthetic question, which he can dissolve by means of certain methods, however difficult to apply.

Naturally those who have the most unworthy gifts, with such powerful tools in hand, will outdo others, just as the mathematician with a creative faculty will leave behind the inexperienced computer, who knows nothing but apply the rules learned. Moreover, rather than creating new mechanisms, it is important to know the existing ones in

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depth. It is really strange how little the old theories are introduced into the nature of the mechanisms and how commonly the most common mechanisms are also known. A kinematics based on genuinely scientific principles will be a great help to the talented enthusiast of the machine who is interested in the object of his studies. It will spare him the faculty of long and often importune research, and will lead him directly to the solution of the various problems, clearly showing him the way to follow. So too the technician, who until now has hardly ever used the kinematics, will discover in it a powerful help to understand existing machines and to judge new ones. This is a sure guarantee that the new science thus transformed will contribute to a great purpose, that of the further progress of the machine theory and its applications. If we summarize in summary the analysis made by us of the procedures until now adopted in the study of the kinematics, and of the ideal that we have to propose, we come to the conclusion that the ordinary theories lack above all the unity; and if the opposite is commonly said, this is only because the scientific methods of research are used in these theories. But, as was said, the most important thing is to make clear the fundamental idea, intimately connected to the nature of the argument. At the same time we must undoubtedly admit that the studies we are dealing with belong to the domain of the exact sciences. In other words, it must be concluded that the methods in use are insufficient and can not withstand the action of time, because they allow only a very limited number of consequences to derive from them; on the other hand they are not even enough to give explanations of all the existing mechanisms. To operate that transformation, of which we demonstrate the necessity, we must strictly adhere to simple and logical principles. What can be deduced from the criticism established by me of the antecedent systems, that which derives from the examples shown and from the considerations that accompany them, this in the end that under various forms and condensed in the philosophical sentences we have quoted, we can, as regards more specifically our subject, summarize in this single proposition: It is about applying to the machine theory the deductive method. The scientific building we must build must rise above the foundation of a few essential principles, and all its members must be able to report and deduce from them. And this is another of the points that at first glance appear weak in the previously prevalent way of studying the subject. And this we do not say because it, moving away from the ideal of the science we traced, makes an inductive method rather than a deductive one. If everything is limited to the use of the inductive method, although this does not present any advantage, yet there would be no reason to support it. No: it was completely lacking in method; since until now the study of kinematics has never been based on certain fundamental principles, or rather it has never been possible to establish such principles, despite careful research and despite the assertions to the contrary of many authors who have repeatedly resounded their eureka. Every exact science must undergo a similar period of transformation with the probability of acquiring clarity and precision only when its subject has grown from time to time to make study possible from a general point of view. Now this period of development and already, no doubt, reached with regard to the kinematics. The number of mechanisms and their applications has increased dramatically, so with the ordinary criteria it is impossible even to avoid losing the thread that should guide us through the intricate maze. We will not be silent, however, that there are serious difficulties in the transformation we are proposing. We ourselves do not often see the bonds that hold us within the confines of those ideas that education and studies have instilled in us.

There is an internal strength in us, to adopt new ones. Regulatoryism of traditional teaching systems, the powerful and extensive influence of technical literature, the habits with difficulty acquired and therefore become more tenacious, finally the difficulty of having to grasp a new system of ideas as a whole, instead of applying with ease to a study of details, made up of many very serious obstacles. Therefore the way that I will have to beat will not be short, although it leads to very simple truths. The care with which I will have to fight prejudices, the slow search for the right path among the many who will present themselves to me, will prevent me from coming straight to the goal.

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The following chapters will not enrich those who deal with the study of machines with positive knowledge, nor can this be their purpose; but we will try to help make better understand what is already known; for, to open with a phrase by Goethe, one does not possess anything but what one understands.

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H Research Edition. ISSN 2532-5612. Publication 2019-20,04 Division edition Group HTNET www.htnetEdition.eu

H Research Edition. ISSN 2532-5612. Publication 2019-20,04 Division edition Group HTNET www.htnetEdition.eu

H Research Edition. ISSN 2532-5612. Publication 2019-20,04 Division edition Group HTNET www.htnetEdition.eu

H Research Edition. ISSN 2532-5612. Publication 2019-20,04 Division edition Group HTNET www.htnetEdition.eu

20) Year 1875 -- The text was published in Florence, (information taken from a hand-written text with pencils); FINBC, A XXIII C 54; Dino Padelletti -- Centrifugal force regulators; The text was published in Florence, (information on the first page written with black pencil) From the timbre on the first text sheet, the original location is visible: Library of the Royal School of Application of Naples.

The text aims to give an ordered and uniform description of centrifugal force regulators, in an era where much has already been written on this topic; in fact, the author in the preface cites textual words: there is perhaps no question of practical mechanics where in the last fifteen or twenty years it has been written as that of centrifugal force regulators. The author Dino Padelletti, proposes this treatment because he believed that the writings on the subject though numerous, were contained in newspapers and magazines mainly foreign technical, and so it was hard, and difficult for a scholar to get a complete idea of the topic without wasting much time.

INDEX ARGUMENTS: I)

Definitions and general considerations

II)

Equation of equilibrium

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H Research Edition. ISSN 2532-5612. Publication 2019-20,04 Division edition Group HTNET www.htnetEdition.eu

21) Year 1879 -- Gahutier-Villars Imperial Library - Paris; FINBC, A XIX B 25; M. E. - J. Habich -- Kinematic studies -- (p. 58); M. E. - J. Habich: elderly figure of importance Polytechnic School of Paris.

Director of the School of Civil Construction.

Deputy Director of the body of government engineers.

INDEX ARGUMENTS: I) For the principles of ventilation: generalities on the movement of a point, movement of a point related to the polar coordinates, envelopes of the right sides that accompany a point in the relative movements, polar trajectory, trajectory whatever II) For

position

references:

introduction,

polar

tangential

coordinates,

transformation of lines in the polar tangential system, state of succession III) Accelerations of movement of a plane figure in its plane

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H Research Edition. ISSN 2532-5612. Publication 2019-20,04 Division edition Group HTNET www.htnetEdition.eu

22) Year 1882 -- Lithography of the Trinacria - Naples; BIBL. FINBC; Ernesto Ferraro

--

Summary of the lessons of Mechanics Applied to

Machines and related drawing dictated by engineer Ernesto Ferraro (first edition, which will be divided a few years later into three volumes) -- (p. 450); From the timbre on the first text sheet, the original location is visible: Library of the Royal School of Application of Naples.

The author Ernesto Ferraro, teacher in the Royal Application School for Engineers in Naples.

Il testo è scritto in un'epoca in cui l'insegnamento di Applied Mechanics to Machines è ufficialmente incluso nel programma di studio; consta di tre volumi.

PREFACE For office on 20 December 1882 appointed by the illustrious sig. Director of this School of Applied Mechanics Mechanics and with the approval of the Ministry of Education I started the course on January 15th.

Being new to teaching, the short time to plan, the many other professional occupations and having wanted to give an address to the new, such that the only necessary theories are to complement the machine organs, taking as a basis the division of Reuleaux welcomed by Colombo, and that little experience that you buy at your own expense passing from the school desk to the workshop, are all these alternations to the imperfections of the present work, to repair which the reader will be able to textbooks that to it have prepared in a superficial way, that is: Padula: Course of Mechanics Applied to Machines dictated at the Application School for Engineers of Naples 1872-73; Zucchetti: of Turin 1881-82 (no further information could be found on this text); Padelletti: Course in Rational Mechanics at the University of Naples 18811882;

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Reuleaux: General theory of Machines or theoretical kinematics, translated

by Prof. Colombo.

Le Constructeur; Sonnet: Dictionnaire des Mathematiques appliquĂŠes; Sponâ&#x20AC;&#x2122;s :Dictionnary of Bngineering, civil, maccanical, etc., etc.; Sacheri: Civil engineering and industrial arts etc.

Some other special monograph quoted in the text.

In the end a heartfelt word of thanks to the pupil of this school sig. Attilio Gallucci who with the good morality will want to have intelligence to autograph these lessons for the benefit of his companions; this fact is due to the origin of this writing not intended for anything other than to serve the students for the course of oral lessons and drawing of machines.

Ferraro explicitly states, in this brief introduction, that he was inspired, among other works, to the "General Machine Theory" from Releaux translated by Giuseppe Colombo.In this text we find significantly some sketches, whose original drawings are shown in the book of the Releaux; for example that of fig. 5 in the following page 193. It is interesting to note that the text of Padula is quoted: Course of Mechanics applied to Machines dictated to the Application School for Engineers of Naples 1872-1873. Unfortunately, this text does not exist in the book catalog of the Federico II School of Engineering, even in the national catalog consulted on the Internet.

From this quotation it would seem that already in 1872-1873 there was a teaching course of Applied Mechanics to Machines.

INDEX ARGUMENTS: I)

Introduction: general solution to the problem of mechanics;

II)

Notes on the most important metals in the construction of the machines;

III)

Metal alloys;

IV)

Notes on the fusion of metals

V)

Union of plates (proportion of simple riveting, with joints cover, with angle irons);

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VI)

Recall of definitions (equation of moving machines);

VII)

Main transformations of movement;

VIII) The various friction resistances; IX)

Ductile kinematic elements;

X)

Teledinamic transmissions;

XI)

Troclee and sizes

XII)

Application examples;

XIII) Organ winches; XIV) Horizontal transport of loads; XV)

Pipes and their connections, keys and taps, steam and pump cylinders;

XVI) Press, crane, elevator and hydraulic accumulators; XVII) Springs; XVIII) Rigid elements; XIX) Simple machines; XX)

Axis pins;

XXI) Trees, joints and grafts; XXII) Supports, chairs and castles, shaft bearings, horizontal and vertical; XXIII) Toothed wheels; XXIV) Steering wheels; XXV) Apparatus for measuring the speed, effort and work of a machine;

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23) Year 1884 -- Lithography of the Trinacria - Naples; BIBL. FINBC;; Ernesto Ferraro -- Summary of the lessons of Mechanics Applied to Machines and related drawing dictated by engineer Ernesto Ferraro, (the text is composed in three volumes) -- (p. 160); From the timbre on the first text sheet, the original location is visible: Library of the Royal School of Application of Naples.

The author Ernesto Ferraro, teacher in the Royal Application School for Engineers in Naples.

The three volumes derive from a revision and expansion of the previous edition consisting of a single volume of over 450 pages.

INDEX ARGUMENTS: vol. I (p. 204) I)

Introduction

II)

Hints on the materials used on the construction of the machines 1) Metals 2) Iron 3) Steel 4) Copper 5) Zingo 6) Tin 7) Metallic Alloys 8) Bronze Brass

III)

News on the raw production of a metal object 1) Fusion - jet models 2) Forging of metals

IV)

Definition calling - Pairs of elements - Kinematic chains - Mechanisms Work Engine, useful, resistant - General equation of the machines in motion - Purpose and usefulness of the machines 1) Machines in motion (The index is like that)

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V)

Apparecchio per misurare la velocitĂ , lo sforzo, il lavoro nelle macchine 1) Loch â&#x20AC;&#x201C; Counters 2) Different dynamometers and ergometers

VI)

Friction resistance 1) Grazing friction and involute friction - experiences coefficients and empirical law of frictions

VII)

Principali trasformazioni del movimento e relativi organi 1) Transformation of the continuous rectilinear movement in continuous rectilinear movement 2) Transformation

of

the

continuous

rectilinear

motion

in

continuous circular and vice versa 3) Transformation of the continuous circular motion in continuous circular motion 4) Transformation of the continuous circular motion into an alternative straight line 5) Transformation of the circular circular motion in an alternate circular way 6) Transformation of the alternative circular movement into an alternative straight line

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vol. II (p. 203) INDEX ARGUMENTS I)

Notes on the materials used in the construction of the machines 1) Special tools 2) Proportions of simple nailings 3) Proportions of cantonal nailings, with joint covers, special connections in the boilers 4) Tabella dei pesi delle lamiere 5) Table of the weights of the iron bars 6) Forced connections, coupling

II)

Simple machines 1) Lever 2) Inclined plane 3) Cuneo 4) Screw and nut screw

III)

Pins, axles and shafts, joints

IV)

Supports, bearings, chairs and castles

V)

Crank mechanisms

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vol. III (p. 212) INDEX ARGUMENTS: Esame di elementi duttili I)

Transmission for belts, rope and chain

II)

Teledinamic transmission

III)

Apparatus for lifting loads

IV)

Horizontal transport of loads

V)

Pipes and their connections, steam and pump cylinders, tanks, plungers, different cranks, valves

VI) VII)

Press, grue, hydraulic elevators and accumulators Notes on the main species of springs, their calculation and properties.

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24) Year 1887 -- Publisher Ermanno Loecher â&#x20AC;&#x201C; Turin, Italy; FINBC, A XXIII B 03; E. Blaha, reviewed by Giuseppe De Paoli -- The distributions of steam engines -- (p. 228); From the timbre on the first text sheet, the original location is visible: Library of the Royal School of Application of Naples.

Giuseppe De Paoli, has reviewed the text originally written by E. Blaha. he original of this text was published in 1878, and won the competition for students of the Royal Polytechnic Institute of Prague, which earned the chair a short time later, to the author Blaha, for teaching the distribution of steam engines.

INDEX ARGUMENTS: I)

Drawer distribution simple

II)

Reverse motion distribution with only one eccentric

III)

Suspension of the glyph and the connecting rod of the drawer

IV)

Suspension of the glyph and the connecting rod

It deals with the distribution mechanisms in steam engines, starting from the motion of the piston, to the valve distribution of crank machines, to the distribution of electric machines.

25) Year 1889 -- Bookseller of the Real Casa Ulrico Hoepli - Milan; FINBC, A XXIII B 17; Egidio Garuffa -- The machine manufacturer -- (p. 623 + 1100 figures); From the timbre on the first text sheet, the original location is visible: Library of the Royal School of Application of Naples.

Egidio Garuffa, engineer and professor of Industrial Mechanics at the School of Encouragement of Arts and Crafts in Milan.

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The text is intended to be a complete treatise on the construction and design of the elementary organs of the machines; describes these organs as clearly as possible by using the many graphic representations shown, "1100 figures".

INDEX ARGUMENTS: I)

Connection bodies: nails and riveting, forced connections, connections with bolts or keys, screw connection or spin

Rigid coupling construction components osculatory I)

First pair of mating elements, helical motion

II)

Second pair of mating constructive elements, rotation motion: pins, (rigid element of torque). Bearing pins, base pins

III) Second pair of constructive elements, rotation motion: bearings and supports (cable element of the torque). Supports for bearing pins, supports for base pins IV) Formation of members with bringing together elements of the rotating pair. Trees subject to bending, trees subject to torsion, trees subject to bending and simultaneous torsion V)

Formation of the members with the gathering of the elements of the pairs of rotation: junction of the trees. Fixed joints, movable joints, coupling joints

VI) Rigid constructive elements formed by assembling parallel pins: templi levers, cranks, eccentric, crankshaft, against cranks VII) Formation of constructive members with the assembly of parallel pins: composite levers, rocker arms VIII) Formation of rigid constructive members by joining two or more hollow elements of the rotation pairs: couplers and connecting rods IX) Unpaired rotation members: flywheels X)

Terza coppia di elementi costruttivi accoppiamenti che realizzano il movimento rettilineo

XI) Coupled members of the rectilinear motion or of complicated rotation with the need to close against pressure fluids.

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XII) Fixed members of the mechanisms. Foundations headquarters. Metal columns

Rigid construction organs mating, non-matching, superior XIII) Primitive contact surfaces: friction and antifriction wheels XIV) Primitive toothed surfaces XV)

Toothed wheels: calculation of the size of the teeth, construction of the toothed wheels

XVI) Toothed wheels (continued): Gear drives and variable speed ratios XVII) Mechanical organs formed with a figure of constant width XVIII) Constructive organs formed with a constructive thrust torque XIX) Arrests XX)

Organi di trasmissione in generale (trasmissione tramite funi)

XXI) Round ropes composed of metal wires, their coupling with pulleys and drums, teledynamic transmission XXII) Transmission for cinde of leather, cotton and cuciĂš XXIII) Organs and articulated traction elements, their coupling with rigid bodies, transmissions for chains XXIV) Organs and articulation traction elements. Chains and their couplings with rigid bodies. Transmission for chains.

Pressure organs in machines and their coupling with rigid bodies XXV) Hard containers and their joints: valves and plugs, transmissions with pressure organs

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26) Year 1890 -- Publisher Ermanno Loycher - Torino; FINBC, A XXIII A 35; Domenico Tessari

--

The kinematics Applied to Machines for use in

application schools for engineers and machine builders

--

(p. 867 + 6

illustrative tables); From the timbre on the first text sheet, the original location is visible: Library of the Royal School of Application of Naples.

Domenico Tessari, professor at the Royal Industrial Museum of Turin, Italy.

The book is for use by the Schools for Engineers, and machine builders; theories of the mechanical organs employed at that time by industrial machines are exposed. In the text, in reality, all those mechanisms that are not used because they are too complex are also considered. The author wants to give a theoretical knowledge of all the existing mechanisms, believing that a good builder must know them all; descriptive theories abstain as much as possible from a mathematical analysis trying to give geometric descriptions of the mechanisms, considered by the author of greater understanding.

PREFACE: In the present work they expose the theory of the mechanical organs employed in the very different machines of modern industry; and we also examine some new mechanisms that have not yet been applied, either because they have been considered so far difficult to carry out, either by custom, or for other reasons.

I have not cared much about knowing about a mechanism is, or is not, practical, whether it is frequently used or not; I dealt mainly with the scientific theory of mechanical organs, I would say almost, regardless of any idea of their applicability. It seems to me that if until today some mechanisms have not been applied, they will be able to find it in the future; and in this regard I remember the golden words of Gergonne: "une nation qui ne cultiverait les sciences que sons the unique point de vue de leurs applications pratiques et immĂŠdiates, et de leurs

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résultats matériels, ne saurait se flatter de les voir longtemps fleurir au milieu of the.

The essential thing is that the manufacturer of a machine has a possibly complete knowledge of the very different mechanisms.

In demonstrations, where I could, I always preferred the purely geometric method, rather than resorting to analysis. So the reasoning is clearer and more evident: the ideas are perceived much better, the mutual relations are more intimately discovered. In this way I can hope to be accessible also to those who have little familiarity with the analysis, and to serve as a practical guide to machine builders.

I have given all of those empirical rules which do not have a scientific basis, and which are still too frequently used in factories.

Today more than ever, the science of machines must be based on the most rigorous theory, given the refinement and precision that is required in their construction.

I consulted the works of GIULIO, CAVALLI, WILLIS, GOODEVE, KENNEDY, LABOULAYE, BELANGER, HATON

DE LA

GOUPILLIÈRE, BOUR, MANNHEIM,

REDTENBACHER, REULEAUX, GRASHOF, SCHOENTLIES, eand in particular the one in press of BORMESTER. It seems superfluous to speak here of the supreme importance of the subject I have proposed to deal with.

It is sufficient to reflect that when an engineer has to compose a machine, he must first of all study the mechanism and the most elegant arrangement of it; ensure the perfect regularity of the motion of the individual parts of the same. Only after this preliminary kinematic study of the machine can it effectively pass to the consideration of the other questions pertaining to it, that is to say on the driving force capable of keeping it moving: the examination of passive resistances: the calculation of the yield and the dimensions to be given to the single pieces for the due stability.

Today, due to the great diffusion of the machines, to the improvements to which they were subjected, only those who have made a cinematic study of it can find

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themselves able to introduce important innovations, which then redundant for the benefit of society, and constitute new triumphs of science.

May my modest work entice others to this kind of studies, so neglected by us, and so much in bloom at other cultured nations, where we mention with praise the names of Hooke, Watt, Stephenson, Peaucellier, Liptkin, Corliss, Hart, Kempe, Oldham, Hankine, RoHerts, Sylvester, Holditsch, Tchebicheff, Allan, Blaha, Eades, Evans, Ferguson, Gooch, Hensinger von Waldegg, Zenner, Reuleaux, Bellermann, Burmester, and many others.

Let us still put ourselves firmly into this fruitful field of study, where much remains to be gathered.

I strongly recommend that the scholar carefully execute all the constructions indicated in the text on a large scale, because only in this way can he penetrate well into the spirit of Kinematics.

I feel obliged to publicly thank from my deepest heart the illustrious Senator Comm. Gaspare Gorresio incomparable Prefect of this R. National Library, for all the aid that with great kindness offers me in the bibliographic inquiries.

INDEX ARGUMENTS: First part: Kinematics I)

I Introduction

II)

Graphic kinematics of plane mechanisms

III)

Relative motions of the line and of the angle

IV)

Torques and kinematic chains

V)

Friction wheels

VI)

Toothed wheels

VII)

Gear trains

VIII) Chains of wedges, eccentrics and buds IX)

Screw chains

X)

Pulleys chains with tension organs

XI)

Chains of the articulated quadrilateral

XII)

Degenerate forms of the articulated quadrilateral

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XIII) Complex articulated systems XIV)

Chains with pressure organs

XV)

Chains with pairs of clutches for grafts

XVI)

Chains of harpoonings

Part two: Dynamics I)

General equations of motion

II)

Friction and its laws

III) Rigidity of the ductile organs IV) Mediated friction and lubrication V)

Dynamic equilibrium and efficiency of mechanisms capable of absolute regime

VI) Brakes VII) Transmission and distribution of mechanical energy VIII) Mechanical measurements IX)

Adjustment of the machines - intrinsic irregularities - flywheels

X)

Adjustments of engines - extrinsic irregularities - regulators

XI)

Impact machines

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27) Year 1895 -- Francesco Giannini e Figli typography - Naples.

BIBL. FINBC; Lorenzo Allievi -- Kinematics of the plane connecting rod -- (all graphic tables) From the timbre on the first text sheet, the original location is visible: Library of the Royal School of Application of Naples..

Lorenzo Allievi, engineer.

The text reports the differential study of kinematics in the plane.

The text deals with object study with only graphical methods, reporting only on the first page of the text (the title page).

THERE IS NO INDEX

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28) Year 1897 -- Publisher Nicola Zanichelli - Bologna; BIBL. FINBC; Francesco Masi -- The theory of mechanisms -- (p. 377 + 24 tables); From thetimbre on the first text sheet, the original location is visible: Library of the Royal School of Application of Naples.

Francesco Masi, engineer, professor at the Application School for Engineers of Bologna.

The preface of the text begins with Ampéré's proposal, contained in the publication of his philosophical being on science, published in 1834, in which he proposed to study motion with more general views, that is put before to the study of the causes, space and speed, considerations of only geometrical character, in other words: to study space and speed first by calling this kinematic method, from the Greek Kivηuα, "moto".

Recall, the ing, F. Masi in his text, that, in 800 this proposal was widely accepted both in the field of practical mechanics, and in that of theoretical mechanics; as a result of this event the kinematics had a remarkable development to which notable scientists contributed, Poncelet, Redtenbacher, Reuleaux, Tessari, Laboulaye, Resal, Belanger, Haton, De la Goupilliére, Bour, Colliguon, Maunhlim, Villé, Giulio, Cavalli, Willis, Goodeve, Kennedy, Grashof, Schoenflies e Burmeslvr.

Some of the scientists above are authors of the following texts: 

Laboulaye: Traité de Cinématique, Paris 1861;



Resal: Traité de Cinématique, Paris 1862;



Belanger: Traité de Cinématique, Paris 1864;



Haton : Traité de Mécanismes, Paris 1863;



Bour: Cours de mécanique et des Machines, Paris 1800 ;



Colliguon: Cinématique, Paris 1879;

Remember that the scientists mentioned above are found in several parts of this document.

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PREFACE: AMPÈRE, in his Essai sur la philosophie des Sciences, published in 1834, proposed that, before studying our knowledge in the most general sense, taking into account spaces, forces and masses, we considered only the geometric aspect, that is, taking under examination only the spaces and the speeds, independently of the forces and this part of the Mechanics placed the name of Kinematics.

Ampère's proposal was received with much fervor, both in the field of theoretical mechanics and in that of practical mechanics; and soon the kinematics had a considerable development thanks to the work of many scientists, among whom, beyond Poncelet, who first inaugurated the teaching at the Sorbonne in 1838, are mainly to be counted: Redtenbacher, Reuleaux, Tessari, Labouloye, Resal, Belanger, Haton, De la Goupilliére, Bour, Colliguon, Maunhlim, Villé, Giulio, Cavalli, Willis, Goodeve, Kennedy, Grashof, Schoenflies e Burmester.

INDEX ARGUMENTS: I)

Fundamental theorems: various forms of motion of a rigid body, relative motion, relation between the velocities of two points of a rigid line - dead point, application to the plane articulated quadrilateral, relative motion of two bodies in contact with a point, relationships between the velocities of the contact points of two bodies that move constantly remaining tangent

II)

Polar of relative motion: relative motion of two compiana figures, geometric determination of the polars of the relative motion, envelope of a mobile plane curve in its plane.

III) Centers of curvature, cyclic curves Euler's formula, construction of savary, circle and pole of inflections - circle of centers, determination of the pole of inflections, cyclical curves, double generations of cyclics, center of curvature of an envelope line.

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IV) Applications in the plan V)

Assoids of the relative motion of two moving bodies around two plane axes Assoids of the relative motion of two moving bodies around two parallel axes, applications, friction curves, applications, problems of friction curves and related graphic resolutions, deduced curves, assoids of the relative motion of two moving bodies around competing axes, asso relative motion of two moving bodies around axes placed in different planes

VI) General theory of toothed wheels determinations of tooth profiles in the cylindrical toothed wheels, inlet line, sliding between tooth profiles, general rules for the tracing of cylindrical wheel teeth - epicycloid toothing, continuous inlet, point toothing, mixed toothing, straight side toothing, spindle gears, planetary planetary wheels, involute toothing, circle arcs tooth pattern, Willis' odontograph, double-toothed generation of teeth profiles, Hooke or Hooke wheels, cylindrical helical wheels with parallel or Willis axes , elliptical wheels, bevel gears, helical bevel gears, spindle wheels and ankles, hyperbolic toothed wheels, approximate construction of hyperbolic toothed wheels, wheel with perpetual life, perpetual life is not reversible, cylindrical helical wheels for axes placed in planes different, machine-cut toothed wheels.

VII) Principles on the kinematic composition of mechanisms kinematic elements, pairs of elements, classifications of pairs, kinematic chain, definition of mechanism and machine, investment of mechanisms, number of elements in the formation of mechanisms, symbolic formulas of mechanisms, analysis or synthesis of mechanisms, classification of mechanisms VIII) Articulated systems

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General information on simple articulated systems, flat articulated quadrilateral, crank mechanisms, speed and space in crank mechanisms with deflected and rotary thrust, Zennar diagram, different crank shapes, collar eccentric, straight and rectilinear crank handle, cross crank , Oldham joint, elliptical lathe by Leonardo da Vinci, universal joint or Hooke joint, double joint, gimbal suspension, general information on compound articulated systems, quadrilaterals and coupled mechanisms, Galde by Scott-Russel or Evac, triangles by Ruberi, parallelogram of Watt, IX) Screw mechanisms General information on screw mechanisms, basic type of single screw mechanisms, Prony differential screw, Persian drill, mechanism to lift gates, rail curving device, parallel vice, carpenter vice, paper press, balance wheel, screw mechanisms with a fluid element X)

Wedges and eccentrics generalities on the wedges and eccentrics, velocities and spaces in the wedges, applications, velocities and spaces in the eccentrics, eccentrics at the heart and at most lobes, eccentric circular bar, cylindrical, and conical

XI) Flat buds (circular, evolving buds, etc.) generality on flat buds, velocities and spaces in the buds with rectilinear motion, involute bead, circular, triangular, tracing of the curve of a bouquets, investment of a circular burr, another form of the elliptic lathe, rotary-scale buds XII) Friction mechanisms general information on friction mechanisms, wheel and wheel rollers, cone and wheel, friction rotations and spooled wheels, friction clutches and stops, friction hammers.

XIII) Rotismo gears

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General information on toothed gears, wheels two cast, Rosmer, Huyghens, asphalted and multi-lobed ellipticals, eccentric wheel, reciprocating, intermittent, stop, palm, gear wheels with a fluid element, capsule gears, problems on geared gears, application to watchmaking, application to parallel lathe, epicyclic system gears, toothed couplings XIV) Harpoonisms (transformations of motion through ratchets) generalities on harpooning, transformation of motion through pawls and

harpoons,

harpoonisms

of

Lugharousse

and

HabillĂŠ,

escapements, ratchets with a fluid element XV) Mechanisms with ductile elements (pulley mechanisms and belts) generality on ductile mechanisms, motion transmission by means of pulley and belt between two parallel axes with constant ratio of angular velocities, shapes of the pulley surfaces, properties of the two belt sections, motion transmission by means of pulley and belt between two axles placed in different planes, transmission by means of countershafts, pulleys to variable motion , stepped pulleys, conical pulleys, belt couplings, transmission by ropes, transmission of motion by chains, mechanisms in which the ductile element is a fluid.

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29) Year 1908 -- Typography Angelo Trani - Napoli; BIBL. FINBC; Ernesto Cavalli -- Elements of Mechanics Applied to the Machines -- (p. 236 + 7 tables); From the timbre on the first text sheet, the original location is visible: Library of the Royal School of Application of Naples.

Ernesto Cavalli, teacher of the Royal Polytechnic University of Naples.

In the preface, below, we read "On the beginning of the book I benefited from the old school of Morin, Poncelet, Redtenbacher ... now was become classic. From that of Hirn, of Petroff ... I took the theory of kinetic friction, theory of which, after having reduced it in an elementary form, following the example of Releaux, I applied the results to the towing and braking of vehicles, as also to the various transmission devices.

Il libro è composto da 236 pagine piÚ 88 figure, raccolte in sette tabelle.

Just over 1/5 of the book deals with steam engines (alternatives and turbines) and, very briefly, those with internal combustion (Otto cycle), typical subjects of Machine teaching.

The arguments are generally carried out theoretically, however referring to updated experimental results.

Approximately the first half of the book is devoted to the evaluation of resistant forces due to the dissipative causes present in simple couplings or in transmissions with tracks, or to the environment medium, with particular reference to the resistance to vehicle motion.

The other topics typical of the Mechanics applied to Machines are shown in the chapters on brakes, on transmission devices (which mainly deals with transmission with belts or cables). In the chapter on balancing machines there is a nod to the balancing of alternative machines and the proportioning of the flywheel is dealt with. Then the centrifugal regulators and the impact machines (mallet, pile driver) are studied. The Ergometry chapter deals with pressure indicators and dynamometric brakes.

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PREFACE In keeping with the progress of Applied Mechanics to machines, I have had the desire to make this book for years, in which we now find the best that has been thought of. I trust that it responds to the current needs of polytechnic education, especially as it also aims to contribute, albeit in a modest proportion, to the development of new things.

In the mechanics the truth is the only source to which it draws useful and penetrates better in our mind, remaining tenaciously impressed, if the method, that leads to discover it, is carried out with simplicity.

On starting the book, I benefited from the old school of MORIN, of PONCELET, of REDTENBACHER............ i took the theory of kinetic friction, a theory of which, after having reduced it to an elementary form, following the example of REULEAUX, i have applied the results to the towing and braking of vehicles, as well as to the various transmission devices.

To make my way to the school of CLAUSIUS, of RANKINE,............ I exposed the organic description of the tools used in ergometry; especially of the pressure indicator and dynamometer brake, which are the most familiar. Then introduced the important notion of entropy, imitating Gibbs e Sankey, I emphasized the correlation between the two indicator and entropy diagrams, which diagrams are used together in the study of thermal machines.

All issues related to the efficiency of the steam engine are based on the theory of heat transfer between steam and cylinder metal, a theory that, with the sort of experimental data, derives from the law of Fourier E., with evidence derived from experience, it was also possible to treat the special case of the turbine.

The theoretical-experimental method was extended to the petrol-driven machines, to evaluate the performance; and on the track pointed to by Wrzz, the few rules to be applied were coordinated.

The problem of balancing one machine, and the other of regulating its movement, have been resolved and exhibited with a simple and uniform procedure. Finally, believing in the old school, I consecrated the last chapter to impact machines.

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INDEX ARGUMENTS: I)

I) Energy and work

II)

II) Friction and its laws

III)

III) Friction and stiffness of the tracks

IV)

IV) Machines moved by hand

V)

V) Kinetic friction and lubricating oils

VI)

VI) Resistance of means

VII) VII) Towing resistance VIII) VIII) Brakes and their theory IX)

IX) Transmission devices

X)

X) Ergometry

XI)

XI) Entropy

XII) XII) Efficiency of the steam engine XIII) XIII) Efficiency of the petrol engine XIV) XIV) Balancing of machines XV) XV) Centrifugal force regulators XVI) XVI) Impact machines

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30) Year 1914 -- It was not possible to find information on publishing; BIBL. DIME; L. De Biase -- Mechanics applied to the machines -- (p. 836); Among the texts of Mechanics Applied to Machines, this is the first in which a large part is dedicated to dynamics.

INDEX ARGUMENTS: First part: Kinematics Applied to Machines I)

Graphic kinematics of plane mechanisms

II)

Relative motions of line and angle (Cardan problem)

III) Torques and kinematic chains IV) Friction wheels: General case of transmission between skew axles and special cases V)

Toothed wheels: general; circular wheels; cycloidal profiles; involute profiles; cast and stitched teeth, hooke wheels; arrow; conical; iperboloidiche; helical; perpetual screw and helical wheel.

VI) Rotismi: ordinary; planetary gearboxes VII) Chains of wedges, eccentrics and buds VIII) Vine chains IX) Pulley chains with tension organs X)

Chain of the articulated quadrilateral

XI) Degenerate forms of the articulated quadrilateral XII) Complex articulated systems XIII) Chains with pressure organs XIV) Chains with friction pairs for grafts XV) Harpoon chains Second part: Dynamics Applied to Machines I)

General equations of the motion of the machines

II)

Friction and its laws

III) Stiffness and friction of ductile organs: vegetable and metallic ropes; ordinary, articulated chains; belts

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IV) Study of passive resistances V)

Mediated friction and lubrication

VI) Dynamic equilibrium and efficiency of mechanisms capable of absolute regime VII) Brakes: brakes in blocks, to tape; braking of vehicles VIII) Transmission and distribution of mechanical energy IX) Mechanical measurements: Absolute system and conventional system; methods

and

errors

of

the

measures;

length

measurements;

measurements of particular surfaces; distance measurements; time measurements; speed measurements; measures of speed variations in the machines; acceleration measures; measures of forces; measures of powers and works and yields.

X)

Adjustment of the driving machines; intrinsic irregularities: flywheels

XI) Regulation of the driving machines; extrinsic irregularities: regulators XII) Impact machines

31) Year 1916 -- Publishinge R. Pironti - Napoli; BIBL. DIME; P. E. Brunelli -- Kinematics of the Machines at Plunger -- (p. 189); Brunelli was a professor (or assistant)* first in Naples, then in Turin; Pietro Enrico Brunelli: Born on May 1, 1876 in Chieti. Graduated in Civil Engineering at the School of Engineering in Rome in 1898 and in Mechanical Naval Engineering at the School of Engineering in Genoa in 1900, from 1905 Brunelli was an ordinary professor of Thermal Machines at the School of Engineering in Naples. During the First World War until 1919, the professor was an officer of the Navy in S.P.E. with the rank of Captain: in the Naval reserve he then reached the rank of Colonel. From 1914 he participated in the construction of ships of different kinds (in 1912 he had directed the recovery works of the sunken ship San Giorgio). In 1932 Brunelli was transferred from the School of Engineering of Naples to the Istituto Superiore di Ingegneria of Turin at the Chair

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of Steam Machines and Technical Physics. Member of the National Research Council, Brunelli was commissioner of the Polytechnic of Turin from 29 April 1945 to 19 November 1945 and later director from 20 November 1945 to 29 March 1947. Brunelli died in Turin on 29 March 1947.

INDEX ARGUMENTS TREATED: I) The rotary thrust crank - Read the piston motion II) The deflected thrust crank III) Connecting rod motion - Tracing of trajectories - General procedures for determining speed and acceleration values IV) Rocker arms and oscillating levers V) Mobile cylinder machines *

It was not possible to find certain information on the role of Brunelli in Naples;

32) Year 1920 -- Politecnico Publishing House, Milan; BIBL. DIME; I. Saraceni

--

Mechanics Applied to Machines (lessons held in the Royal

Polytechnic of Milan, first and third part); Igino Saraceni: Prof. of Meccanica. Applied to Machines at the Milan Polytechnic.

INDEX ARGUMENTS: Part One: Applied Kinematics I) Recalls of some elements of plane kinematics II) Kinematic pairs III) Kinematic chains IV) Transmission of the rotary motion by means of wheels and gears V) Transmission of rotary motion by means of tracks (belt systems, rope, metal cable, chains) VI) Simple articulated systems

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VII) Complex articulated systems VIII) Mechanisms of the distributions of the steam engines to obtain the inversion of the motion IX) Special toothed wheels Part Three: Technical Thermodynamics I) Physical quantities considered in technical thermodynamics II) Fundamental principles of thermodynamics III) Transformations IV) Thermal cycles and their yields V) Changes in physical condition VI) Perfect gas theory: fundamental laws; fundamental equation of the thermodynamics of perfect gases; thermal transformations of perfect gases VII) Polytropic transformations; cycles consisting of four polytropics VIII) Theory of saturated vapors: general relations; fundamental equation of the thermodynamics of saturated vapors; thermal transformations of saturated vapors; mixtures of saturated vapors IX) Overheated vapors and real gases: general relations; thermal transformations of overheated vapors and real gases.

X) The permanent motion of fluids XI) Irreversible thermal transformations; outflow of gases and vapors: flow of fluids in general

33) Year 1922 -- Publishing F.Lubrano, Napoli; BIBL. DIME; G.D.Mayer -- Mechanics applied to machines - Part I: Applied kinematics; The book consists of about 300 pages, half of which reserved for cinematic and half for dynamics. Both for the kinematics and for the dynamics, the topics covered by the text are representative of the topics covered at the end of the nineties by the Mechanics applied to Machines at the Federico II Engineering Faculty.

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References to the study of energy transformations in engines are missing altogether.

INDEX ARGUMENTS: I) General information on the kinematics of plane systems II) Kinematic pairs III) The friction wheels IV) The toothed wheels V) Eccentric, Cunei, Bocciuoli VI) Pulleys and tracks VII) The crank mechanisms

34) Year 1922 -- Publisher Albin Michel; BIBL. DIME; J. Boulvin -- Course of mechanics applied to machines (held at L'Ecole Speciale du Genie Civil de Gand); J. Boulvin: Honorary Engineer des Ponts and ChausseĂŠs, and Director of Maritime Construction of the Belgian State.

Vol. I â&#x20AC;&#x201C; General theory of mechanisms; INDEX ARGUMENTS: General theory of mechanisms I) Recall of some principles of theoretical kinematics II) Mechanisms with connecting rod III) Articulated mechanisms for rectilinear motion guides IV) ratchets V) Couplings for connection of two rotating shafts VI) Drawstring mechanisms (with prismatic torque) VII) Cams and eccentrics VIII) Friction wheels and gears: transmission between parallel axes, transmission between competing axes and between skewed axes, helical gears,

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gears derived from the screw; gear trains; friction wheels and gears with variable speed ratio.

IX) Transmission with ropes and straps X) Mechanisms comprising a fluid XI) Change of speed by means of belts XII) Change of speed by means of gears XIII) Hydraulic transformers Second part: Statics and Dynamics I) General equation of the machines II) Friction between solids III) Friction of liquids on solids IV) Rolling resistance V) The rigidity of the strings VI) Work absorbed in collisions VII) Equilibrium of mechanisms subject to passive resistances: VIII) Systems in which friction must not be considered IX) Systems in which rolling resistance is produced X) Systems involving flexible bonds XI) Transmission with straps and with ropes XII) Systems with impacts XIII) Theory of the flywheel XIV) Regulators XV) Spring regulators XVI) Dynamic theory of regulators XVII) Measurement of the work of the forces and power of the machines XVIII) Work produced by an isolated force XIX) Work produced by the pressure of a fluid XX) Motor work available on a tree XXI) Transmission dynamometers XXII) Scale dynamometers

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35) Year 1928 -- Lithograph of the Civil Engineers, Rome; BIBL. DIME; A. Anastasi -- Lessons in Applied Mechanics, Part 1 - Machine Kinematics and Dynamics, VoI. 2nd (Academic year 1928-29); A. Anastasi Rector of the School of Engineering of Rome - Institute of Machines.

INDEX ARGUMENTS: I) Tracks II) Power transmission between trees by means of tracks III) Rope or chain machines - cable cars IV) Flat and spherical maneuvers: flat articulated quadrilateral; kinematic study of the crank and piston rod mechanism; dynamic study of the crank and plunger rod mechanism; Cardano joint V) Adjustment of the periodic motion: irregularity of the periodic-fly motion; calculation of excess work; flywheel effect of the masses in alternate motion of some poly-cylindrical machines VI) Regulation of the speed of the regime: generalities on the regulation; centrifugal force automatic speed regulators; characteristic curves of the regulators

36) Year 1930 -- Librairie J.B. Bailliére et Fils, Paris; BIBL. DIME; M. L. Lecornu -- Propriété Générale des Machines (p. 230); M. I. Lecornu: Prof. at the Polytechnic School and at the National High School of Mines.

INDEX ARGUMENTS: I) Static machines: Conditions of equilibrium; contact of two solid bodies; passive resistances; applications II) Work of the machines

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III) Volani: general theory; elastic flywheel; case of an engine that drives a propeller; breaking of the flywheels IV) Regulation: static of centrifugal force regulators; regulators without springs; centrifugal force regulators with springs V) Brakes VI) Internal efforts in a car VII) Balance of a machine VIII) Vibration IX) Similar machines It is the first text in which the topic specifically appears: vibrations.

37) Year 1936 -- Lithograph of the Civil Engineers, Rome.

BIBL. DIME; A. Anastasi -- Lessons of Mechanics Applied to the Machines, Volume I: Mechanism Theory - Kinematics and Dynamics Applied (Academic Year 193637); A. Anastasi: Rector of the University of Rome, Faculty of Engineering of Rome.

INDEX ARGUMENTS: First part: Theory of Mechanisms I) Couples of kinematic elements II) Kinematic chains and mechanisms III) Articulated guides of rectilinear motion and amplifying mechanisms; kinematic chains with any number of members; replacement of pairs superior to pairs of rotoids Second part: Kinematics and Applied Dynamics I) Passive resistances II) Speed and accelerations of the points of the machines; inertial forces; living forces; work transmission; yield III) Dynamic study of the inferior couples

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IV) Mechanisms of eccentric V) Mechanisms of three members where the two pieces of furniture are wheels; assoids, rolling levers; friction wheels VI) Cylindrical toothed wheels VII) Toothed wheels with non-parallel axes; calculation of the gear wheels; yield VIII) Ordinary and epicycloidal rotations; ball and roller bearings

38) Year 1942 -- Technical Library Editrice V. Giorgio - Turin; BIBL. DIME; J. Candeo - Cicogna -- Mechanics exercises applied to machines; Technical Library Editrice V.Giorgio, Turin.

A. Anastasi - R. University of Rome, Faculty of Engineering of Rome.

INDEX ARGUMENTS TREATED: Fundamental principles of mechanics I) Basic principles of statics II) Systems of competing coplanar forces III) Friction between dry contact surfaces IV) Parallel parallel forces V) Companar forces however arranged VI) The principle of virtual displacements VII) Kinematics of a point VIII) The fundamental principles of dynamics IX) The fundamentals of analytical - graphic kinematics X) Vibration The main applications of mechanics I) Gear transmissions: ordinary gears II) Gear transmissions: epicyclo gears III) Ropes, funicular machines

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IV) Transmission by means of belts V) Brakes VI) Springs VII) Rolling bearings VIII) Study of some car parts

39) Year 1943 -- it was not possible to find information on publishing; BIBL. DIME; V. Foschi -- Applied Mechanics Exercises; Italian editions -- (p. 385); INDEX ARGUMENTS: Theoretical mechanics I) Kinematics of the point II) Motion of a plane figure in his plane III) Movement of a rigid figure in space IV) Composition and decomposition of forces V) Equilibrium of bodies and constrained systems without friction VI) Principle of virtual works VII) Rectilinear motion and curvilinear motion of a point VIII) Moments of inertia, living force, momentum IX) Principle of d'Alembert, Theorems on the motion of the systems X) Relative motion; impulsions Applied mechanics I) Composition of mechanisms II) Equilibrium of constrained bodies systems (without passive resistances) III) Passive resistances IV) Equilibrium of constrained bodies systems (with passive resistances) V) Dimensions of the main mechanical units. Measurement systems VI) General properties of the velocities and accelerations of the points of a flat figure

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VII) Transmission of work; inertial force; living force; reduced masses; momentum VIII) Dynamic equilibrium of the systems IX) Efficiency of the machines X) Mechanisms of three elements XI) Toothed wheels XII) Ordinary and epicycloidal gears, ball bearings XIII) Transmissions with flexible elements XIV) Mechanisms of four elements XV) Adjustment of periodic motion; flywheels XVI) Regulating the speed of the regime; regulators XVII) Measurement of power XVIII) Springs XIX) Vibrations XX) Resonance phenomena; critical speeds; gyroscopic actions XXI) Balance of inertia forces It is the first text in which the topics appear: critical speeds and gyroscopic actions.

40) Year 1948 -- Levrotto & Bella Publishing - Torino.

BIBL. DIME; M. Panetti -- Mechanics Applied to the Machines, ( vol. I, vol. II, vol. III); M. Panetti, Professor of Mechanics Applied to Machines at the Polytechnic of Turin, Italy, since 1910.

vol. I (fourth edition., p. 506) INDEX ARGUMENTS: I) Foundations of the kinematics of machines:

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1) composition of the machines 2) speed and instantaneous center 3) polar and primitive 4) rollette 5) accelerations in the plane motion 6) center of accelerations and curvatures of the trajectories 7) conjugated profiles 8) friction in the machines 9) rolling creep friction 10) friction between lubricated surfaces 11) rolling friction II) The resistance of the means 1) pressure resistance 2) wake phenomena and wall friction 3) resistance of the vehicle to ballistic speeds 4) technical news on the resistance of the vehicle III) Foundations of machine dynamics 1) kinetic energy equation 2) yield; d'Alembert's theorem 3) frame reactions and balancing 4) power dynamometer measurement 5) various motorcycles in the machines IV) Mechanisms made up of elementary pairs 1) prismatic couple 2) rotoidal couple 3) elementary theory 4) dry rotoidal pairs 5) theory of attrition 6) friction trains 7) lubricated rotoidal pairs V) Rolling bearings: general provisions and kinematic problems

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1) resistance to crushing of the rolling elements; 2) distribution of the load on the rollers and on the balls of a radial bearing 3) fatigue resistance 4) friction of rolling bearings; 5) pins with pastry wheel VI) Helical pair 1) elementary theory of the vine 2) mechanisms derived from the helical torque 3) forcing the helical torque VII) Vibrating motions in the machines 1) motions oscillators of a point 2) bending vibrations in the trees 3) oscillations of rigid bodies held by a fixed axis (torsional oscillations) 4) flat oscillations of the sprung frames

vol. II (fourth edition, reprint, p. 317) INDEX ARGUMENTS: I) Primitives of the wheels II) Cylindrical toothed profiles 1) Cycloid toothings 2) Special toothings 3) evolving teeth 4) Wheels with helical teeth III) The works of attrition in the wheels with parallel axes IV) Wheels for transmission between competing primitive axes and conical clutch pairs 1) Conical teeth

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2) Spiral conical wheels V)

Ruote elicoidali per trasmissioni fra assi sghembi

VI) Coppie di avvitamento senza fine VII) Roteggi ordinari VIII) Roteggi epicicloidali 1) Dynamic problem of epicyclical rotations

vol. III (fourth edition, reprint, p. 208) INDEX ARGUMENTS: I) Ropes II) Chains III) Funicular machines IV) Funicular transport V) Transmissions with tracks VI) Technical problems on transmissions

41) Year 1949 -- Politecnica C. Tamburini Publishing House - Milan; BIBL. DIME; G. Scotto Lavina

-- Machine Mechanics Applications, Part Three

372); INDEX ARGUMENTS: I) The Volano II) The calculation of the yield III) The critical bending speeds

-- (p.

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42) Year 1952 -- Publishing Liguori â&#x20AC;&#x201C; Naples, Italy; BIBL. DIME; P. Ferretti -- Mechanics of the machines; vol. I, Naples (identical to the following edition of 1966) -- (p. 368); Pericle Ferretti, Professor of Mechanics Applied to the Machines in Naples.

INDEX ARGUMENTS TREATED: I) Kinematics 1) Torques and kinematic chains 2) The motion of a plane figure in one's plane 3) The conjugated profiles II) Dynamics 1) Il lavoro delle forze di inerzia 2) Rendimento biologico 3) Resistenze passive III) Dynamic phenomena in rotary motion 1) Constant angular velocity around a central axis of inertia (ie: gyroscopic phenomena) 2) Constant angular velocity around a barycentric axis (non-central inertia) 3) Constant angular velocity around a non-barycentric axis (ie: flexural critical velocity) 4) Variable angular velocity (ie: torsional oscillations) IV) Transmissions with wheels of clutches V) Transmission with toothed wheels VI) Transmissions with tracks VII) The rotary push crank 1) Kinematics 2) The forces of inertia 3) The balance of inertia forces 4) The engine moment

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5) Eccentric crank mechanism IV) The adjustment of the machines 1) The problem of regulation 2) The flywheels 3) The regulators 4) The brakes V) The lubrication 1) The phenomenon of friction 2) Imperfectly lubricated surfaces 3) Perfectly lubricated surfaces 4) Experimental results VI) The constructive forms of the bearings 1) Bearings with fixed fifth wheels 2) Bearings with mobile fifth wheels

43) Year 1954 -- Publishing Liguori - Napoli; BIBL. DIME; P. Ferretti, M. Taddei -- Mechanics of machines; vol. II -- (p. 485); Pericle Ferretti, Professor of Mechanics applied to machines in Naples; M. Taddei: Full Professor of Mechanics Applied to Machines from 1951 to 1981.

INDEX ARGUMENTS: I) General information on the measures 1) The measurement of quantities 2) Errors in the measurements 3) Units of measurement and unit systems 4) Laws of similarities II) Electrical methods in mechanical measurements 1) Sensitive elements 2) The electrical circuits

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3) Electrical measuring instruments III) Measurement of physical quantities 1) Measurement of fundamental quantities 2) Measurement of geometric quantities 3) Measure of the kinematic quantities 4) Measurement of dynamic quantities

44) Anno 1956 -- Publishing Riccardo Patron - Bologna; BIBL. DIME; A. Prosciutto -- Elements of Mechanics Applied to Machines - (Fifth edition revised and expanded by F. Caboni and G. Moranti; A. Prosciutto, Professor in the Engineering Faculty of the University of Bologna; INDEX ARGUMENTS: 1) Basic principles of mechanics 2) Motion of a material point 3) Force systems 4) Masses systems 5) Kinematics and dynamics of a rigid body 6) Compound mechanical systems 7) Swings 8) Principles of machine dynamics 9) Passive resistances and yields 10) Elementary couples 11) Articulated systems 12) Rotary push crank 13) Crank at Glyph and cross-type 14) Spherical articulated quadrilateral 15) Friction wheels

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16) Simple and compound gears and gears 17) Mechanisms with flexible organs 18) Eccentrics 19) ratchets 20) Uniformity of the motion and calculation of the flywheels 21) Motion regularity and dynamic balancing 22) The regulation of the driving machines 23) Critical speeds and torsional oscillations of the trees 24) Measurement of mechanical work

45) Year 1964 -- Technical Scientific Publishing - Pisa; BIBL. DIME; E. Pistolesi -- Mechanics Applied to Machines - XI edition revised by Prof. M. Marini -- (p.702); INDEX ARGUMENTS: I) Kinematic foundations of machine theory 1) Kinematic pairs 2) Spherical cinematic pairs 3) General kinematic pairs 4) Kinematics chains and mechanisms 5) Conjugated profiles and their tracking 6) Polar II) Forces acting in machines 1) Contact actions between solid bodies 2) Contact actions between solids and fluids 3) Principles of fluid dynamics 4) Actions of a fluid current on the immersed bodies 5) Viscous fluids 6) Basic elements on the impact

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III) Friction and lubrication 1) Creep friction 2) Logement of the Reye hypothesis 3) Rolling friction 4) Elastic slip in the rolling 5) General concepts on lubrication 6) Prismatic torque and rotoidal torque 7) General setting of the lubrication problem.

8) Case of the upper plane pairs 9) Lubricants IV) Foundations of machine dynamics 1) Works and returns 2) Balance of the machines. Forces of inertia 3) Reduced forces and masses 4) Replacement masses - dynamic equivalence 5) Oscillating motions 6) Forced oscillations 7) Coupled oscillations 8) Vibration 9) Units and measurement systems V) Study of elementary couples 1) Prismatic, rotoidal, helical pair 2) Efficiency of the inclined plane 3) Push pins 4) Rolling bearings VI) Articulated systems and their applications 1) Articulated quadrilateral 2) Crank mechanisms 3) Applications of articulated systems 4) Articulated joints 5) Capsulisms derived from the crank mechanism

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VII) Upper couples 1) Friction wheels 2) Eccentric and their classification 3) Arrests and harpooning VIII) Toothed wheels 1) Kinematics of toothed wheels 2) Cycloal toothings 3) Involute teeth 4) Involute wheel interference 5) Helical-toothed cylindrical wheels 6) Efficiency of the cylindrical wheels 7) Wheels of a special type 8) Conical wheels 9) Wheels for transmission between skew axles 10) Helical worm wheel screw 11) Perpetual screw with globoidal thread 12) Capsule gears IX) gear trains 1) Ordinary rotations 2) Epicicidal gear trains X) Flexible organs and their applications 1) Stiffness of flexible organs 2) Static applications 3) Dynamic applications 4) Tensions in the two branches of the belt 5) Elongation, sliding and calculation of the belts 6) Performance XI) Brakes 1) Block brakes 2) Friction brakes 3) Fluid brakes and hydraulic couplings

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4) Electromagnetic brakes 5) servo-brakes XII) Dynamics of machines 1) Balancing of rotating shafts 2) Balancing machines 3) Critical speed of rotating shafts XIII) Dynamics of plunger machines 1) Speed and acceleration of the connecting rod 2) Inertial forces and connecting rod calculation 3) Reduced axes of the alternating masses and of the connecting rod 4) Pressed pressures, inertial pressures, effective pressures 5) Forces applied to the frame 6) Balance, equilibrio XIV) Theory of regulation 1) Periodic irregularity of a machine 2) Tredgold method for the calculation of irregularity and flywheel 3) Wittembauer method 4) Elasticity of the motors, regulation 5) Insensitivity and pendular oscillations of the regulators 6) Various types of regulators 7) Notes on the analytical problem of regulators XV) Experimental measurement of mechanical work 1) Quantity to be measured and methods of measurement 2) Dynamometric scales 3) Measurement of the reaction torque 4) Transmission dynamometric scales 5) Dynamometric brakes 6) Deformation dynamometers 7) Torque

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46) Year 1969 -- Di Stefano Library - Genoa.

BIBL. DIME; A. Capoca -- Mechanics Applied to Machines - vol. The Genoa, Italy -- (p.

301) A.A. Capocaca: professor at the University of Genoa, Italy.

INDEX ARGUMENTS: I) General notions 1) The machine: its evolution and its human value!

2) Kinematic pairs II) Grazing friction and its forms 1) 1) Friction between dry surfaces 2) 2) Fluid or viscous friction 3) 3) The hydrodynamic theory III) The lubrication of elementary kinematic pairs 1) The lubricated prismatic torque. The lubricating bearing rotoidal torque.

2) The lubricated pushing rotoidal torque 3) The helical torque lubricated IV) Lubrication of the upper kinematic pairs 1) General principles 2) Lubrication of the eccentrics 3) Lubrication of gears 4) Problems on kinematic Torques lubricated in fluid regime 5) Direct and inverse problem 6). Re-use systems 7) Grease lubrication systems V) Dimensional theory of fluid lubrication VI) Experiences on lubricants and lubrication 1) Friction measurements 2) Relief of pressure distribution

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3) Experiences of the author I) Problems on the evolving friction 1) Transportation of a load by wagons or rollers II) Rolling bearings 1) Characteristics of rolling bearings 2) Various types of bearings 3) Lubrication of rolling bearings III) Resistance of the means

47) Year 1986 -- Torino Ghigliazza, Galletti -- Mechanics applied to UTET machines; Ghigliazza Rinaldo: Prof of Mechanics. Applied to Machines, Genoa.

Galletti Carlo Ugo: Engineer of Applied Mechanics, Genoa.

INDEX ARGUMENTS: Applied kinematics I) Structure of the mechanisms 1) 1) Constraints 2) 2) Kinematics chains and mechanisms II) Kinematic analysis of plane mechanisms 1) 1) Relative movement between the members 2) 2) Analysis of the mechanisms with only lower pairs 3) 3) Analysis of the mechanisms with superior pairs III) Kinematic analysis of spatial mechanisms 1) General rigid movement

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2) Analysis of the mechanisms with only lower pairs IV) Synthesis of mechanisms 1) Summary of number 2) Dimensional summary V) Applied dynamics VI) Mechanical systems and models 1) Physical systems and abstract systems 2) Mathematical models VII) Surface mechanics 1) Recalls on the characteristics of solids 2) Surface phenomena 3) Forces acting in couplings 4) Usury VIII) Dynamic analysis of machines and mechanisms 1) Systems with a degree of freedom 2) Flat mechanisms with rigid members 3) Rigid member spatial mechanisms 4) Model linearization IX) Linear systems 1) Basic properties 2) Modal analysis 3) Transfer functions 4) Mechanical applications X) Mechanical components (mechanisms) XI) Elementary couples 1) Classification 2) Elementary couples dry or with limit lubrication 3) Elementary couples with fluid lubrication 4) Rolling elementary pairs 5) Comparison between the performance of the various types of elementary pairs

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X) Power transmission 1) Classification 2) Smooth wheels (or wheels for friction or friction) 3) Toothed wheels (gears) 4) Wheels and hoses 5) Comparison of mechanisms with constant ratio 6) Speed variators 7) Couplings 8) Grafts 9) Brakes XI) Mechanisms for motoion various 1) Articulated systems 2) Mechanisms with cams 3) Mechanisms with intermittent motion 4) Unidirectional mechanisms 5) Comparison between the various types of mechanisms for various motion

48) Year 1988 -- Publishing Patron - Bologna; BIBL. DIME; Funaioli - Maggiore - Menghetti - Mechanics lessons applied to machines, (Volume I - Volume II); Maggiore Alberto, Professor of Mechanics Applied to Machines, Bologna Meneghetti Umberto, Professor of Mechanics Applied to Machines, Bologna INDEX ARGUMENTS: I) Recalls of dynamics II) Dynamics of the thrust crank and the articulated quadrilateral III) The inverse dynamic problem IV) Dynamics of periodically operating systems V) Vibrations of systems with a degree of freedom

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VI) Vibrations of systems with two and many degrees of freedom VII) Dynamics of the rotors VIII) Introduction to the experimental study of vibrations IX) Adjustment of the angular velocity X) Funaioli

49) Year 1991 -- Publisher Liquori - Napoli; BIBL. FINBEC; Angelo Raffaele Guido - Lelio Della Pietra - Mechanics lessons applied to machines, (Volume I - Volume II); Lelio Della Pietra, Professor of Mechanics Applied to Machines at the Federico II University of Engineering, Naples, Italy.

Angelo Raffaele Guido, Professor of Mechanics Applied to Machines, at the Federico II University of Engineering, Naples, Italy.

Il testo è diviso in due volumi, era il testo utilizzato per l'insegnamento della Meccanica Applicata alle Macchine nella Facoltà di Ingegneria, Federico II, up to 2013-2014.

vol. I (p. 457) INDEX ARGUMENTS: I) efinition of machines and fundamental principles 1) Machines and mechanisms 2) Kinematic pairs 3) Degrees of freedom of a mechanism and a machine 4) The cardinal equations of mechanics 5) The motion theorem of the centroid 6) Classification of forces 7) Examples of applications of the principle of d'Alembert

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8) Work of a force 9) Kinetic energy of a mechanical system 10) The theorem of kinetic energy 11) Equivalent systems and reduced systems 12) Equivalent systems - general case, (Exercise) - Flat motion, Examples 13) Reduced systems, 5 Examples 14) Reduced system of a machine 15) Power of a car 16) Passive resistances 17) Friction resistors, Examples 18) The mechanical efficiency 19) Mechanisms in series and in parallel 20) Irreversible mechanisms 21) The efficiency of irreversible mechanisms II) The operation of a group of machines 1) Introduction 2) Regime condition, Examples 3) Degree of irregularity in the period 4) Determination of the mass moment of inertia of a flywheel 5) Sizing of a flywheel, 3 Examples 6) Mechanical characteristic of a machine, Examples 7) Stability of the regime conditions 8) Degree of staticity and regulation range 9) Centrifugal regulators 10) Operation of the regulation system 11) The characteristic equation of a centrifugal regulator, Exercise 12) The Tolle curve: stability of a centrifugal regulator 13) Degree of staticity of a regulator, Examples 14) An example of application: the regulator of Watt isoscele 15) The characteristic curve of a regulator, Examples

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16) Sensitivity of a centrifugal regulator, Examples 17) Indirect regulation III) Dynamics of rigid rotors 1) Introduction 2) Recalls of dynamics 3) The cardinal equations of rigid bodies 4) The rotation matrix 5) Static and dynamic imbalance of a rotor 6) Forces and torques of inertia due to imbalance, 2 Examples 7) Effects of inertia pairs: critical speeds 8) Gyroscopic inertia pairs 9) Gyroscopic structure rotors, 4 Examples 10) Rotors with non-gyroscopic structure, Examples IV) Gyroscopes 1) Historical background 2) Elementary gyroscopic phenomena 3) The study of the dynamic behavior of a gyroscope 4) The corners of Euler 5) The vector {w} according to Euler's angles 6) The equations of motion of a gyroscope 7) The integration of the equations of motion: The free motion as regular precession - The free motion as oscillations of small amplitude: stability of the gyroscope - System response to a rising step pair: precession 8) regular pseudo 9) Elementary theory of the gyroscope: Response to a moment torque Mx and a precession ψ - Response to a moment torque Mξ and a precession Ǿ 10) Constructive aspects of a gyroscope, Exercise 11) Technical applications of gyroscopes

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12) The gyroscopic pendulum: Description - The equations of motion The integration of the equations of motion 13) The gyro compass: Description - The equations of motion Integration of the equations of motion V) Mechanical vibrations 1) Introduction 2) Periodic motion 3) Harmonic motion 4) Vector representation of a harmonic motion 5) Composition of two harmonic motions directed along the same axis: Beats 6) Composition of two harmonic motions directed according to orthogonal axes 7) Harmonic analysis 8) Basic vibrational phenomena 9) Mathematical models of discrete systems 10) Degrees of freedom of a system 11) Systems with a degree of freedom 12) Conservation systems: Free vibrations 13) Forced harmonic vibrations 14) Periodic forced vibrations 15) Application examples: 5 Examples 16) Stiffness coefficients of the elastic elements, 9 Examples 17) Dissipative systems: free vibrations 18) Forced harmonic vibrations 19) Vector method 20) Vibrations excited by a harmonic motion 21) Application examples, 2 Examples 22) Two-degree systems of freedom

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23) Free oscillations in the absence of damping: Integration of the equations of motion - The determination of integration constants - The vibrating modes of the system 24) Forced oscillations in the absence of damping: Integration of the equations of motion - The determination of integration constants - The vibrating modes of the system 25) Forced oscillations in the absence of damping 26) Application examples: dynamic damper 27) Systems with n degrees of freedom VI) Balancing of rigid rotating members 1) Introduction 2) Static imbalance and dynamic imbalance 3) Balancing: balancing masses and correction planes 4) Balancing machines 5) Balancing with machines with elastic supports 6) Balancing with machines with rigid supports 7) Degree of accuracy of the balancing: residual unbalance

vol. II (p. 461) INDEX ARGUMENTS TREATED: I) Critical flexion speeds 1) Introduction 2) The mathematical model from Rankine to Cree 3) Critical speeds such as flexural resonances: The mathematical model of jeffcott 4) System with non-rigid supports 5) Reverse precession motion or whirling pours 6) No symmetric systems: the disk effect 7) Critical speeds for a system with two concentrated masses

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8) Approximate Dunkerley formula 9) Secondary critical speeds: 6 Examples II) Torsional critical speeds 1) Introduction 2) Discrete systems 3) The vibrating modes of a two-disc system 4) The forced motion of the two-disc system 5) Torsional critical speeds: 7 Examples III) Transmissions with friction wheels 1) The transmission of rotary motion 2) Transmission between skew axles: the shape of the friction wheels 3) Friction wheels for transmission between parallel axes 4) Friction wheels for transmission between incident axles 5) Dynamic behavior of the friction wheels IV) Transmission with toothed wheels 1) General 2) General concepts 3) Cylindrical gears 4) Kinematic study of cylindrical wheels: conjugated profiles; Action line, arc line; Active profile 5) The cycloidal profile 6) The involute profile: definition and pèrorpietà of the involute; The conjugated profiles; Characteristics of involute toothed wheels; The basic sprocket-denture pair; Line and arch of conduct; The minimum number of teeth; Internal toothed wheels; 7) Helical-toothed wheels: Stepped wheels and helical-toothed wheels; The contact between the teeth; The basic denture; Mutual reaction and axial thrust; Exercises 8) The cutting of involute toothing with a rack tool 9) Conical wheels: primitive surfaces; The conjugated profiles: the approximation of Tredgold; The minimum number of teeth;

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Characteristic sizes of conical wheels with straight teeth; Mutual reaction and axial and radial thrusts; 10) The efficiency of a gear: The instantaneous yield; the average yield 11) gearings 12) Ordinary rotations 13) Epicycloidal gears 14) Classification of epicycloidal gyrations 15) The Willis formula 16) Planetary compensating gears 17) Reducer epicyclic gears The torque acting on the axes of the gears 18) Application examples V) Transmission with flexible organs 1) Introduction 2) Description of the flat belt transmission 3) Principles of operation of the transmission 4) The mounting voltage T0 5) The parameters that influence the values of T1: The winding angle Îą1; The coefficient f; The mass m; The peripheral speed v; 6) The transmission efficiency VI) Hydrodynamic lubrication 1) Fluid lubrication 2) The viscosity of a fluid: Newton's law 3) Hydrodynamic lubrication in the machines 4) Hydrodynamic lubrication in plain bearings 5) The Reynolds equation: The equations of the fluid motion in the meatus; The speeds u and w; The continuity condition 6) Simplified mathematical models 7) The "short" bearing load-bearing: The height of the meatus; The diagrams u (y) and w (y); The integration of the equation (16.6-4); The

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load W and the minimum height of the meatus; the coefficient of friction; The Sommerfled number; Application example; 8) Flat roller thrust bearings: The height of the meatus; The speed diagrams in the meatus; The integration of the equation (12.8-1); The load W and the minimum height h dek meatus; The coefficient of friction 9) Fixed roller bearings with fixed pads: Application examples 10) Michel bearings: Application examples 11) Appendix chapter 12 VII) Alternative machines: Internal Combustion Engines: 1) Introduction 2) The rotary thrust crank 3) Kinematic study 4) The movement of the crank button 5) The motion of the connecting rod a. The displacement of point C b. The speed of the puto C c. The acceleration of point C 2) The motion of the connecting rod a. The trajectory of a point of the connecting rod axis b. The speed of point D c. The acceleration of point D 3) Graphic procedures a. Polygon of speed b. Polygon of accelerations c. 2 Examples 4) Dynamic study: the forces of inertia a. The forces of inertia due to the movement of the crank b. The forces of inertia due to the motion of the piston c. The forces of inertia due to the movement of the connecting rod, Example

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d. The resulting inertia forces a. The balancing of inertia forces 9) The forces due to fluid pressure 10) The forces that urge the crank mechanism 11) The engine moment 12) The diagram of the motor moment a. Graphic procedure b. Analytical procedure, Example 13) Indicated and effective power, 2 Examples 14) Alternative multi-cylinder machines 15) The uniformity of the engine moment in multi-cylinder engines 16) Arrangement of the cranks: ignition order 17) Balance of inertia forces 18) Application examples

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CHAPTER TWO The Mechanics Applied to Machines in Naples: its historical development

II. 1 HISTORICAL NEWS ON THE BIRTH OF MECHANICS APPLIED TO MACHINES An arduous task is certainly to establish in what period and course the lessons of Applied Mechanics to Machines emerge. Intuitively we have to think in some course of Mechanics, then roughly in the period in which courses on Machine Mechanics are introduced; for something more exhaustive you must immerse yourself in historical archives, browse fascinating books that date back to the second half of the eighteenth century, like the text by Frisi Paolo, "institutions of mechanics, hydrostatics of hydrometry and static architecture, and hydraulic to use in the Royal School erected in Milan for architects, and for the engineers ", fabulous handwritten texts.

From these documents we go back to the absolute confusion of the unorganized studies of that time and therefore of the historical investigation that begins to assume a stable structure towards the beginning of the 800, in fact, from the first institution to the preparation of professional figures aimed at the tasks carried out by the Engineer, we find cited, courses of Mechanics aimed at "Machines".

Before the eighteenth century, there was no real institution dedicated to the art of the Engineer, but a sort of courses in which Elementary Mechanics and Mathematics are cited, which together with the passing of the art, formed the only unclear roads to be undertaken to become an Engineer.

At the beginning of the 18th century, with the advent of the French people, documents were available to establish the first disciplines given in the Schools for Engineers; in these there is a sort of mechanics course whose purpose was to prepare students for the study of tools used in different crafts, blacksmiths, peasants, craftsmen, tailors, etc., so as to be able to improve them to increase their productivity, reducing the work man.

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Rather than Meccanica it was a sort of study of the Machines and working technologies existing at that time; later this branch of studies will form the group of the disciplines of Machines and Technologies, from where it will then officially take life the Mechanics Applied to Machines.

II. 2 FIRST NEWS ON THE ARGOMENTS OF MECHANICS APPLIED TO MACHINES To give the best solution to our problem, that is to say, to try to understand, what were the topics studied that, at least in part, concerned the Mechanics Applied to Machines, before its official insertion, we considered it appropriate to face the problem with a historical approach. Not having specific documents, which could lead directly to the solution of the problem, we have circumvented the obstacle by trying to follow, according to a temporal and logical, progression, the events that have marked the history of Mechanics Applied to Machines ".

Although found in 1882, under the direction and teaching of Padula, the Mechanics Applied to Machines, in the official study plan, we find traces, of related lessons already in 1872, belonging to the group of teachings of machines and materials technologies.

In the first half of the eighteenth century, as shown in the previous chapter, in many texts used by the students of the Royal School for Engineers, topics are dealt with that still today form the official program of Applied Mechanics in Machines.

In the second half of the eighteenth century, the situation undergoes a remarkable change; the mechanisms become the main object in the study of the machines, so that together with the theory with which they study, the kinematics now well established, give a significant change to the study of the Mechanics Applied to the Machines, that is, of the machines themselves.

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Towards the beginning of the second half of the nineteenth century, kinematics is seen as a new method for the study of machines able to reconcile theory with a practical event that often did not happen; in this era the evolution of the machine was in constant growth the theory was often bypassed by practice, which gives an idea of the confusion that there could be.

In the first half of the eighteenth century, machine scientists, as well as authors of mechanical texts, felt the strong influence of Ampéré's statements, which were published in 1834, in which he proposed to study motion with more general views, that is, before of the study of causes, study the space and velocity, considerations of only geometrical character, that is to study space and speed first, calling this kinematic method, a term that derives from the Greek Kivηuα, or "motion"; this proposal was widely accepted both in the field of practical mechanics and in that of theoretical mechanics; as a result of this and other significant events, which can be seen in the forewords of some texts reported in the previous chapter, the kinematics had a remarkable development to which notable scientists contributed as, Poncelet, Redtenbacher, Reuleaux, Tessari, Labouloye, Resal, Belanger, Haton, De la Goupilliére, Bour, Colliguon, Maunhlim, Villé, Giulio, Cavalli, Willis, Goodeve, Kennedy, Grashof, Schoenflies e Burmester.

In the year 1777 there is a text by Frisi Paolo, which contains a set of disciplines, such as mechanics, hydrostatics, hydrometry, static and hydraulic architecture; the text reports, at least for the part concerning the mechanics, already clearly mentioned the problems that will induce the Mechanics Applied to Machines in the following century, in fact it deals with: the handling of simple and composed machines.

Since 1818, we find texts such as, Traitè complet de mécanique appliquée aux arts of Borgnis, which describes the cogwheels, also reporting, in appendix, tables with representations of mechanisms to transfer and transform the motion.

From the text of Reuleaux, it was possible to draw a profile on what could be the topics that gave life to the study of the machines and that subsequently become part of the discipline. The author, Reuleaux, reports a complete introduction in which he describes, among other things, the situation of the 800 on the study of the Machines, highlighting how a new way of seeing them took hold, that is, not as a single body but

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to enter inside, with the theory; in essence it calls various scholars, in different historical moments, to show that the evolution of the Machine implied a transformation of the way of studying them. Remember that some scholars, mentioned above, supported the subdivision of the machines in the relative internal parts, from which the mechanisms derive and from which the kinematics derives or the study of the latter.

Reuleaux shows, from a great teacher, the importance of not entering the machine only in the workshops with a practical point of view, but to reconcile the theoretical aspect of the machine with the practical one, trying to clearly explain the inaccuracy of the methods of approach used as they are always discordant with practice. From our research, they are not resulted worthy inventions related to Relueaux, who distinguished him by genius, at least according to his description of genius, (page 152 of the studied text, primo capitolo testo No 19); sure yes it can be of the great influence he has had on his colleagues, in fact many have followed him recognizing the merits of great scholar of the topic, others while not mentioning it among their texts, they have it undoubtedly imitated, for example, in some important graphical representations like the one shown in the previous chapter (page 152 of the studied text, primo capitolo testo No 19). Reuleaux was a great promoter and scholar of the kinematics applied to the machines; tries to extend this new approach to all scholars, showing how in other places, where this discipline had established itself, they were ahead in the study of machines, as in France.

Continuing the historical analysis of the events that marked the machines and with them the relative methods of study, at least until those that we have been able to detect, we find Watt, who in 1763, with his overbearing genius, as defined by Reuleaux , reaches the highest degree of perfection of the steam engine. It can be considered, with sufficient certainty, that the most important event, for the development of a discipline that studied the machines, and therefore the development of a set of related topics whose purpose was linked to the machines, was the perfection of the engine steam, as it triggers a process of evolution in traction, such as long distance travel, in the industrial sector, with the partial substitution of machines for man, motor pumps, for mines, and anything else you can imagine in passing from an era in which the work was done

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mainly by man, to one, in which there was a machine able to replace the work of man with appropriate mechanisms of connection.

Since Watt was only a steam machine refiner, there are certainly other important events concerning the birth of the study of the machines, this being linked to the invention of the steam engine; to better expose these events we think it is the case to invert the temporal order of the analysis starting from the beginning of the 600 up to the year in which Watt, makes public its overbearing genius.

The invention of the steam engine is linked to a series of events; the beginning of these events is marked by Torricelli, a young student of Galileo, who in 1643 discovered the weight of the atmosphere, creating not a little confusion, or rather the horror of emptiness. To this problem brought Pascal clarity in 1648 in Paris on the river Puy-deDòme, performing the first and memorable experience whose end was the measure of heights with the barometer; the bells of Munster and Osnabruck sounded to the success of this experience to celebrate the triumph of the young science and, above all, clarity to the many doubts inflicted by the new knowledge.

In 1650, in Magdeburg, Otto di Guerieke, with a pneumatic machine and other equipment of experience, demonstrated in a scientific and popular way the force corresponding to atmospheric pressure, introducing a new element in the scientific questions of the day. From here we try to use this new element, that is the powerful pressure deriving from emptiness in every place; the attempts do not give success until, in 1696, Papin in Marburg finds the solution. That is, it creates a appliance, a cylinder equipped with a plunger, in which the phenomenon of condensation of water vapor takes place; this phenomenon will then give life to the steam engine. Papin, fails to perfect his machine or to make it work in the practical field, while giving life to the principle of the steam engine, but remains unused for almost fifty years, after which there was the first practical application, namely the first steam machine; in fact, in 1705 two workers, Newcomen and Cawley, in England, realized the first application of the Papin apparatus, joining it to a pump, and used for the mines. We therefore arrived at the end of our framework, in fact, the next significant event that will revolutionize the history of the machines in the years to follow is the maximum refinement to which Watt brings the steam engine. A final observation regards the way in which Reuleaux

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defines the inventive genius of Watt, that is, overbearing genius: one of the reasons lies in the invention of the steam engine whose merits are not attributable to Watt but to Papin, much less the merits of making this operative invention, since this work was carried out by two workers over fifty years after the invention.

Described then a general picture of those that were the topics that have formed the study of the machines, at least as far as possible, it was interesting to note that after the sensational inventions of Papin, except the application of the steam pump, not there are there are other sensational inventions, at least until Watt publishes his work of perfection. To this, Reuleaux gives, in a few lines, an exhaustive answer, in fact he writes in the introduction of his text: "too little was known the heat, this indispensable agent, we knew not even measure it. First of all it was necessary perfect the thermometer, the thermodynamics would make an essential progress".

In other words, not it could be in other way, given the lack of technical material to continue, in particular the problem was heat, the main agent of the phenomena discussed, whose knowledge was limited to a rudimentary instrument to measure the temperature, which also it required a refinement. It is therefore legitimate for thermodynamics to make progress before continuing; at least until Watt appeared to upset the situation.

In a sense, let's start from the beginning of the seven hundred century and continue in later stages; this, which may seem only a repetition of the analysis, wants to return, in a definitive way on the problem of the study of the machines, the distinction between the single body with respect to the use and the mechanisms with which it is formed, which in they turn introduce the kinematics applied to the machines.

The machines needed a subdivision, which does not happen in a decent way until 1724, when Leupold made a distinction between single mechanisms and machines, which are studied for themselves and only accessoriatamene compared to their different applications. This method did not extend, since a final destination had not yet been made, they always fell into the domain of physics, taken in a more general sense compared to the same applications of a machine.

As soon as the first Polytechnic school was founded in Paris, in 1794, the orderly division began, between the theory of mechanisms and machines.

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So as seen, in the first part of this paragraph, towards the end of the first half of the nineteenth century, most scholars find a new point of agreement, the kinematics applied to the machines, or the study of the mechanisms and how it will be better explained later in the following years the Mechanics Applied to the Machines takes a decisive turn towards evolution; after 870 we have certainty that the first texts aimed at teaching are written, treating a good part of the arguments that still today are an integral part of the lessons held by current professors of this discipline at the Faculty of Engineering in Naples, Italy.

II. 3 MECHANICS APPLIED TO THE MACHINES, OFFICIAL The subject matter, from the first information in our possession (cited in the bibliography), is officially introduced during the period in which prof. Mendia, appointed Director of the Application School of Napoles, presented a new reorganization of the internal Rules and, upon his proposal, the School Council, in a short time and after a mature discussion, compiled, on May 25, 1882, the new Regulations, which the Directorate of the School, it has submitted for the Ministry approval in the same time; which was given with a ministerial note dated 12 September 1882 n. 18590.

According to this Regulation, among the expected courses there was also that of Mechanics Applied to the Machines; below are all the teachings established by this provision: First year: rational mechanics; Geodesy (which was given at the University); Application of descriptive geometry and corresponding drawings; Static graphics with relative drawing; Docimastic chemistry; Mineralogy and Geology applied to buildings; Architecture drawing.

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Second year: theoretical and practical hydraulics; Mechanics applied to the Machines; Mechanics applied to buildings; Practical geometry and Celerimensura; Technical Physics; Agriculture and Rural Estimation; Architecture drawing.

Third year: Architecture and corresponding drawings; Civil constructions and stradaÂŹli and relative drawings; Hydraulic constructions with relative design; Railways and fixed and mobile materials with corresponding drawings; Thermal and hydraulic and agricultural machines; Judicial matters.

In this regard it must be said that already after the extension of the Turin regulation by Royal Decree of 30 July 1863 provisionally, then definitively, there is included among the exams, Applied Mechanics; there is reason to believe that during this period already lessons of Applied Mechanics to the machines were given, in fact, in the preface of the text by Ernesto Ferraro (1882), a manuscript is cited containing lessons in Applied Mechanics to Machines dictated by Prof. Padula in 1873 at the School for Engineers of Naples. Furthermore, the General Regulations approved by Royal Decree on October 8, 1876, include, among the mandatory exams, the Mechanics Applied to Machines.

In these years, 1876 - 1884, it would seem that the chair of mechanics applied to the machines is definitively introduced; no specific documents could be found.

We are sure that the Teaching Group on Machines and Technology, since 1884, is divided into two chairs one for the thermal, hydraulic and agricultural machines, entrusted to the extraordinary professor ing. Francesco Milone and the other, for the Mechanics applied to the machines, entrusted to prof. in charge ing. Ernesto Ferraro.

The professor. Milone, who had set up a machine room in motion since 1883, continued to actively take care of this area of his teaching activity in the following years, with the active collaboration of prof. Ernesto Cavalli, who around 1891 became an ordinary professor of mechanics applied to the machines of the same school. On his death, May 7, 1911, the teaching of the matter was taken on behalf of the engineer. Giovanni Domenico Mayer, from 1907 help to the Chair.

Since 1884, we have certain information on the position of Applied Mechanics in Machines; will remain firmly inserted in the second year in the order until 1938.

Even when in 1938, the engineering studies were reorganized and divided into different sections and subsections, giving rise to several degree courses, the discipline of Applied

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Mechanics remains mandatory and common in all degree courses, among the joint examinations of the three-year application; the respective lessons were given in the third year of studies, a situation that remained unchanged until 1960.

Even when in 1938, the engineering studies were reorganized and divided into different sections and subsections, giving rise to several degree courses, the discipline of Applied Mechanics remains mandatory and common in all degree courses, among the joint examinations of the three-year application; the respective lessons were given in the third year of studies, a situation that remained unchanged until 1960.

For the degree courses in mechanics, electrotechnics, aeronautics, naval and mechanics, things remain unchanged, while for the degree courses in civil, electrical and chemical engineering, the Mechanics Applied to Machines from the third year are eliminated, and teaching is introduced of Mechanics Applied to the Machines and Machines in the fourth year.

Starting from the new order of 1989, the Mechanics Applied to Machines remains among the fundamental examinations of the third year, for the only degree courses in Mechanical Engineering, Management, Naval, Aeronautics and Electrical Engineering.

II. 4 ARGUMENTS OF MECHANICS APPLIED TO THE MACHINES Beyond the certain information on the topics covered by the Mechanics Applied to Machines in 1898, we did not find any further documentation which explicitly shows what the topics were treated, over the years, from Applied Mechanics to Machines, at least up to the Gentile (°) reform; nevertheless we considered it plausible to consider the evolution of teaching by following the development of texts that dealt with this discipline.

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(°)The Gentile reform is a series of normative acts of the Kingdom of Italy which constituted the organic school reform launched in Italy. It took its name from the inspiration, the neo-realist philosopher Giovanni Gentile, Minister of Education of the Mussolini government in 1923 who elaborated it together with Giuseppe Lombardo Radice.

The texts object, date back to the beginning of the 800 period in which the first Schools for Engineers are established, and at least until the first half of this century there is not a specific text of Applied Mechanics to Machines but texts that deal with the first topics that will form the program of the discipline some decades later.

Before 1876 it was possible to learn some information on what could be the topics taken from the Mechanics Applied to Machines, the lessons concerned the theory of machines, such as engines where no fluid is used, the measurement and the conduct of the waters. The exercises carried out during the second half of the year, on the other hand, consisted of hydrometric and dynamometric works and observations of machines and water conducts; in this semester the project of the machine or the design of the water pipeline had to be done to be presented to the oral exam.

After 1876 yes they can have precise information on what could be the topics covered in the lessons, in fact we know of the existence of a manuscript that collects, such lessons, dictated by Padula.

A first complete profile on the topics that constitute the program of Mechanics Applied to Machines in the penultimate decade of the 800, it was possible to derive it from the text of the Professor, and teacher of this teaching at the School of Naples, "Summary of the lessons of Applied Mechanics to the Machines and related drawing dictated by the engineer Ernesto Ferraro "; from this text it is possible to observe two chapters dedicated to foundry materials and techniques to obtain a metal casting, that is a confirmation of the fact that the Mechanics Applied to Machines derives from the group of teachings of technologies and Machines.

The text cited above clearly shows in the preface, the need to introduce an advanced, changed and targeted teaching to the machines; in fact, the same author shows how the problem of machines has been faced by many scholars avoiding the definition, because

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none of the existing ones was generally adequate to define the object of study, of a science in constant evolution and driven by the increasing use of the machine itself in society.

In a complete introduction, the author, Prof Ernesto Ferraro, draws attention to the typologies of machines, defining two main categories, the moving machines or conveyors and the transforming or modifying machines, today defined as Machine Operators and Traction machines.

Beyond what was said about the introduction of the first text of Applied Mechanics to Machines, found in Naples, we must necessarily observe that the exact way to see the machine, intended above all as an engine, had already been intuited by many scholars, including Prof. Ernesto Ferraro , which is a set of simple and compound mechanisms, but what had not yet taken over was a theory able to predict the functioning of this whole before its creation.

On the method of studying an invention like the machine, one can have a clear exposition from the introduction of the text of Reuleaux, "general machine theory" (cited several times for its importance), translated by Prof. Giuseppe Colombo at the Institute Superior of Milan, who proposes to abandon the scientific approach usually used whose basis and to see the machine as a single body relative to the application, and to take back the approach of the kinematics with which the Mechanisms that constitute a machine are studied, recalling the AmpĂŠrĂŠ considerations of the beginning of the century.

Only with the kinematics will it be possible to study a machine before its creation; this is supported by many scholars of the time, and already intuited by the great Reuleaux, as abundantly described in the previous paragraph.

At the beginning of the nine hundred century, there are texts with complete discussion of the topics, which are still studied today, such as the study of the rotary push mechanism; from these it is also possible to see a study program of Mechanics Applied to Machines which, at least in general, approaches that of the end of the millennium. A representation of what could be the study program of Mechanics Applied to machines at the beginning of the 900 is reported in the text of Ernesto Cavallo professor of this

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teaching at the Engineering Polytechnic of Naples, namely: energy and work, friction and its laws, friction and rigidity of the tracks, hand-moved machines, kinetic friction and lubricating oils, resistance of the means, resistance to the towing, brakes and their theory, transmission devices, geometry, entropy, efficiency of the steam engine, efficiency of the petrol engine, balancing of the machine, centrifugal force regulators, impact machines.

Examining one of the current "1999 - 2000" programs of Applied Mechanics at Machines, proposed to the students of the University of Engineering of Naples, by one of the recent professors, Prof Lelio Delle Pietra, it can be seen how teaching, at the beginning of the 20th century , had assumed a stable form, in fact most of the arguments are still treated, namely: definition of machine and fundamental principles, reduction of masses and forces, reduced system of a machine: machine at absolute regime, periodic regime, moment engine, moment resistant, moment torque, moment and power of a machine, regimen conditions, the operation of a group of machines, dynamics of rigid rotors, mechanical vibrations, balancing of rigid rotating members, bending (flexural) critical speeds, torsional critical speeds, transmissions with wheels of clutches, transmissions with toothed wheels, classification of epicyclic gears, the formula of Willis , the couples acting in the sprocket system, compensating gear systems, planetary gear reducer systems, transmission with flexible organs, alternative machines.

We consider it interesting to conclude with a reflection on the definition above: "invention not repeatable like the machine"; the evolution of the machine derives from the optics with which it has been studied, that is to see it as a set of mechanisms; it would seem that in the new millennium it is destined to disappear! We will be watching, what in the next millennium will not happen: the extinction of the mechanisms, without which no mechanical artifice can be created. How can the invention of mechanisms be defined? If the great ones like Reuleaux, AmpĂŠrĂŠ, have succeeded in their understanding, it is a mistake to ask the question, the machine is nothing but a set of mechanisms. We certainly do not want to be reductive, a fundamental role must also be attributed to thermodynamics, we only place ourselves in a more general perspective.

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APPENDIX The list of the texts of Mechanics Applied to Machines, or containing topics typical of the Mechanics Applied to Machines, which are present in the Federico II Engineering Faculty of Naples, Italy

On November 18, 1808, the establishment of a Royal Corps of Bridges and Roads was decreed in Portici, from Murat; with a subsequent decree dated March 4, 1811, an Application School was set up for the training of engineers assigned to the Corps. There are three academic degrees: approval, license, degree. To be admitted to the School of Application it was necessary to be examined by a commission, which paid particular attention to the knowledge of mathematics. The duration of the studies was three years..

With the return of the Bourbon King to Naples between the end of 1815 and the beginning of 1817, the body of the Bridges and Roads Engineers was abolished together with its Application School.

With the decree of March 25, 1817, the Statute of Engineers was approved to direct the provincial works. By decree of 10 November it was decided that from the following 10 January 1819 a School of Application of Bridges and Roads would be established in Naples. The duration of the studies was reduced from three years of the old school, at two years of the new school. In the two-year course, lessons were given in the following disciplines: Applied Mechanics, Geodesy and Descriptive Geometry, Construction, Civil Architecture and Topography. At the end of the studies, the students had to take an exit exam, carried out in two phases: one written and one oral. With the passing of this examination he was conferred the title of Engineer to direct the provincial works as required by the Statute of Engineers.

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In 1826 the disciplines imparted in the School of Application of Bridges and Roads were reorganized in the following six: Hydraulic Architecture and Hydrometric Practice, Chemistry and Mineralogy, Applied Mathematics, Descriptive Geometry with its applications and Geodesy, Civil Architecture and Design, Construction in general and the art of designing.

Between 1834 and 1836 it was established that the studies carried out in the Application School for Engineers of Bridges and Roads gave the right to a degree in Civil Architecture. On November 2, 1835, a Register of Architects was established. The ordering of the School of Application of Bridges and Roads during this period is faithfully described by Antonio Maturi. From him it was learned that there were two biennials (no more than one) in which Mechanics and Hydraulics were taught; descriptive geometry, with all its applications to the theory of shadows, perspective and cutting of stones and timber; Geodesy; Geognosia and the design of civil architecture.

The first two years ended with an examination that drew the deserving ones to attend the second two-year period. In the second two years were taught: Mechanics Applied to the theories of the resistance of solid bodies, the formation of supporting load-bearing walls, vaults and all kinds of woodworking; the Static, hydraulic and finally the Elements of Chemistry and Agriculture.

The School of Application of Bridges and Roads in February 1861 takes the name of Application School of Engineers of the Genius Civil, after a decree of the PrinceLieutenant of the King, ordering according to the Italian law of November 20 the Corps of Engineers of Bridges and Roads, he called it the Corps of Engineers of the Genius Civil. The subjects taught in this period are: Descriptive Geometry, Civil Architecture, Applied Physics, Mineralogy, Law, Agriculture, Landscape, Topography.

By decree of 24 June 1863 it is established that, from the following July, the Application School of Engineers of Civil Engineers established in the city of Naples passed from the Ministry of Public Works to that of the Ministry of Public Education.

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With another legislative provision of the following July 30, the Turin regulation of October 17, 1860 was extended to the School of Naples, so that it assumed the name of Real Application School for Engineers, in which, as is mentioned by Mendia, passed all the teachings of the ancient school. After about half a century the Application School was detached from the Corps of Engineers. The Turin regulation, also extended to Naples, aimed to give graduates in Mathematics the necessary knowledge to practice the art of the Engineer and the Architect. Admission was reserved for Mathematics graduates only and the duration of the studies was reported again to a single two-year period.

A definitive structure to the regulations of the Royal Schools of application for engineers in Italy was given by the General Regulations approved by Royal Decree of October 8, 1876 according to which the Schools, after a three-year course,in which were admitted students with license Physical Mathematics and Certificate of diligence to the courses of Mineralogy, Geology, Design of ornate and Architecture, passed the examinations scheduled in the three years could confer the diploma of Civil Engineer, or that of Architect. The diploma as an Engineer enabled the management of civil, rural, road, hydraulic and mechanical constructions, and to support the judicial expert's office in related matters. The diploma as an architect enabled the management of civil and rural factories, and to perform the functions of a building and rural expert. The compulsory subjects in the first year were: Rational Mechanics (with exercises); Theoretical Geodesy (with exercises); Static graphics (with exercises); Application of Descriptive Geometry (with Exercises); Docimastic chemistry (with manipulations).

The compulsory subjects for the second and third year, for the aspiring to the diploma of engineer, were: Mineralogy and Geology applied to the building materials; Practical geometry; Mechanics applied to machines; Practical hydraulics; Hydraulic machines; Agricultural machinery; Thermal machines; Technical architecture; Civil and rural buildings; Foundations; Bridges in masonry, wood and iron; Ordinary roads; Railway tracks and tunnels; Hydraulic constructions and maritime works; Agricultural

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hydraulics and drainage; Rural economy and rural estimate; Technical physics; Legal matters.

For those aspiring to architect diplomas, compulsory subjects in these years were: Mineralogy and Geology applied to construction materials; Practical geometry; Mechanics applied to buildings; Technical architecture; Civil and rural buildings; Rural economy and estime; Technical physics; Legal matters.

The candidates for the diploma of Architect also had the obligation to follow studies of the architecture classes at the local Academies of Fine Arts.

With a ministerial note dated September 12, 1882, the school year was divided into two periods: the first for oral lessons that began on November 21st and ended at the end of May, the second for exercises that began in June principles and ended in September .

The exams were distributed as follows: For the engineer course: First year: rational mechanics; Geodesy (which was given at the University); Application of descriptive geometry and corresponding drawings; Static graphics with relative drawing; Docimastic chemistry; Mineralogy and Geology applied to buildings; Architecture drawing.

Second year: theoretical and practical hydraulics; Mechanics applied to the Machines; Mechanics applied to buildings; Practical geometry and Celerimensura; Technical Physics; Agriculture and Rural Estimation; Architecture drawing.

Third year: Architecture and corresponding drawings; Civil constructions and stradaÂŹli and relative drawings; Hydraulic constructions with relative design; Railways and fixed and mobile materials with corresponding drawings; Thermal and hydraulic and agricultural machines; Judicial matters.

For the Architecture course First year: teaching subjects were the same as those of the same engineering course.

Second year: Mechanics applied to constructions: Technical Physics; Practical geometry and Celerimensura; Agriculture and Rural Estimation; Architecture drawing.

Third year: Architecture and corresponding drawings: Civil constructions and buildings and related drawings; Judicial matters..

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In order to obtain the Diploma of Architect, in addition to the special exams and the final one of the Degree in the School, the certificate of assistance was requested with profit, in the Royal Institute of Fine Arts.

In 1888, two Engineering sections were created: Industrial Engineering degree and Naval Engineering degree.

With a decree dated December 29, 1890, the Internal Regulations of the School were approved by the Minister of Education, subsequently amended with the ministerial notes of February 7, 1893 and November 14, 1893; with the royal decree of 8 June 1893, the definitive structure of an autonomous university was then given to the School.

After January 25, 1898, the School of Engineers no longer had two separate periods for lessons but only one that began on October 15th and ended on August 15th. The years of the course were three and each of them had the following teaching materials for the engineering course: First year: Rational Mechanics and related exercises, Geodesy, Applications of Descriptive Geometry and Relative Design, Graphic Static and Relative Design, Chemistry applied to related exercises, Architectural drawing.

Second year: General and applied geology, Theoretical and practical hydraulics, Mechanics applied to the machines, and machine design, Construction science, Practical geometry, Technical architecture and architectural design.

Third year: Agriculture and Rural Estimates, Technical Physics, Hydraulic Construction and Masonry Bridges, Construction in Iron and Wood, Railways and Road Construction, Hydraulic and Agricultural Thermal Machines, Legal Materials, Architecture and Architectural Design.

On 14 and 24 October 1901, thanks to the solicitation of the honorable Nicolò Gallo, Minister of Education Public, were issued the decrees establishing the Industrial Section of the Application School of Engineers of Naples.

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On 8 July 1904 with the approval of the law n. 351, article 32 of which established: the Engineers' Application School is transformed into a Polytechnic High School; to the current courses are added courses complementary to give greater development of practice to current teachings, adding those of electrical engineering and construction and electrical applications, as well as those concerning shipbuilding.

By royal decree of November 30, 1905 it was declared: I The transformation of the Application School for the engineers of Naples in the Polytechnic High School; II The institution at the aforementioned School, of a naval Section with the faculty to confer the degree of naval and mechanical engineering; III The division of the already existing Industrial Section into two subsections: Electromechanics and Electrochemistry (read Industrial Chemistry); IV The addition, to the existing teachings, of those of: Electromechanical

constructions;

Electrochemistry;

Naval

architecture;

Naval

constructions; Marine machines.

By ministerial ordinance of 25 October 1924 and subsequent amendments in April 1925, the statute of the Neapolitan School of Engineering was approved according to which it was established that the Royal School of Engineering of Naples was constituted in the Autonomous Superior Institute under the title of Relae Scuola Superiore Polytechnic University of Naples. The industrial section was in turn subdivided into subsections of chemistry, electrotechnics, mechanics.

With the modification of the Statute of the Polytechnic School of 12 October 1925, the definitive suppression of the title of Royal Higher Polytechnic School takes place, for which it is called R. School of Engineering in Naples.

With r. d. of October 7, 1926, while the national university engineering program was being reorganized, it was established: the examination of the license for those who had attended the two-year course, in order to ascertain their scientific maturity and their

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aptitude for the studies of the three years of application, to which, with the passing of this examination, they were admitted; the state exam for professional qualification. The real School of engineers in Naples is constituted of two years and three years.

The year 1936 marks, for the School of Engineers of Naples, the end of its autonomy.

With the single article of the Law n. 1100 of June 13 of that year authorized the minister competent to dispose, within the term of three years, the suppression, the institution or the merger of faculties, schools and university courses, as well as the aggregation of the royal colleges superior to the universities.

With a royal decree of 28 November 1935 n. 2044 is confirmed that for the degree in engineering the duration of the studies is five years divided into three years of preparatory studies and three years of application studies; the admission title is the diploma of classical maturity or of scientific maturity.

With r. d. of 30 September 1938, n. 1652 the studies that led to the degree were reordered, confirming that the course lasted five years, divided into two years of preparatory studies and three years of application studies. This triennium was divided into six sections that gave rise respectively to the following degrees: Degree in civi1e engineering (subsections: construction, hydraulics, transport); Degree in industrial engineering (subsections: mechanics, electrotechnics, chiÂŹmics, aeronautics), Degree in naval and mechanical engineering; Degree in chemical engineering; Degree in aeronautical engineering; Degree in mining engineering.

According to this provision, the basic teachings of the two-year preparatory studies were: Mathematical analysis (algebra and biennial infinitesimal); Analytical geometry with elements of projective and descriptive with a drawing (two-year); Rational mechanics, with elements of graphic statics and design (biennial); Experimental

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studies, with exercises (biennial); General and inorganic chemistry with organic elements; Drawing (biennial); Mineralogy and Geology.

The fundamental lessons of the three-year application period, common to all the sections, were: 1) Construction science; 2) Mechanics applied to machines; 3) Technical physics; 4) Applied chemistry; 5) Topography with elements of geodesy; 6) Technical architecture; 7) Hydraulics; 8) Electrical engineering; 9) Machines; 10) General technologies; 11) Legal and economic matters.

While the complementary ones, always common to all the sections, were: 1) Architecture and architectural composition; 2) Urban planning technique; 3) Road and railway constructions; 4) Transport technology and economy; 5) Bridge construction; 6) Buildings in wood, iron and reinforced concrete; 7) Hydraulic constructions; 8) Maritime buildings; 9) Special hydraulic systems; 10) Agricultural hydraulics; 11) Hygiene applied to engineering; 12) Civil and rural estimate; 13) Agriculture and rural economy; 14) Construction of machines; 15) Design of machines and projects; 16) Special technologies; 17) Mechanical industrial plants; 18) Electrical industrial plants; 19) Chemical industrial plants; 20) Construction of electrical machines; 21) Electric traction;

22)

Electrical

communications;

23)

Electrical

measurements;

24)

Radiotechnics; 25) Organic chemistry; 26) Physical chemistry; 27) Industrial chemistry; 28) Analytical chemistry; 29) Electrochemistry; 30) Special chiÂŹmiche technologies; 31) Agricultural chemistry; 32) Agricultural mechanics; 33) Mining art; 34) Metallurgy and metallography; 35) Mineral deposits; 36) Mining geophysics; 37) Petrography; 38) Applied geology; 39) Paleontology; 40) Aerodynamics; 41) General aeronautics; 42) Aeronautical buildings; 43) Special aeronautical technologies; 44) Aircraft engines; 45) Testing and maneuvering of aircraft; 46) Aerology; 47) Equipment and instruments on board; 48) Naval architecture; 49) Merchant naval constructions; 50) Military naval construction; 51) Marine machines; 52) Complements of mathematics. The complementary exams were nine that a student had to choose to complete the Engineering studies.

Then there were the Schools of perfection, which were those of Industrial Chemistry; of Electrotechnics and Aeronautics, all lasting one year.

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For each one, having passed the exams of certain courses, one was entitled to a specialization degree.

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BIBLIOGRAPHY. For the research we have referred to the following quotations.

The list of the texts of Mechanics Applied to Machines, or containing topics typical of the Mechanics Applied to Machines, which are present in the Federico II Engineering Faculty of Naples, Italy.

B. I

Alphabetical list

B. II

List in chronological order

B. III List of authors in alphabetical order B. IV

List of authors in chronological order

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B. I Alphabetical list

1) BELANGER, J. B. Traité de cinématique / J. B. Bélanger. Paris: GauthierVillars, 1864 2) BOCQUET, J. A. Elementary course in applied mechanics / J. A. Bocquet; translation of F. Sinigaglia. 4. ed. Napoli, Italy: Pellerano Scientific and Industrial Library, 1919 3) BOIDI, Giuseppe A. The builder mechanical engineer, ie course of practical theoretical drawing of the machines / Giuseppe A. Boidi. Torino, Italy: V. Bona, 1873 4) BOIDI, Giuseppe A.: Terms used in species to practical mechanics. XVI, 427, 31 p.: ill. Torino, Italy: V. Bona, 1873 5) BORGNIS, J. A. Traité complet de mécanique appliquée aux arts : contenant l'exposition méthodique des théories et des expériences les plus utiles pour diriger le choix, l'invention, la construction et l'emploi de toutes les espèces de machines / par J. A. Borgnis Paris : Bachelier, 1818 6) BORGNIS, J. a. Mouvements des fardeaux. XII, 335 p., 20 tav.: ill. Paris: Bachelier, 1818 7) BORGNIS, J. a. Des machines employées dans les constructions diverses. XII, 319 p., 26 tav.: ill. Paris: Bachelier, 18188) BORGNIS, J. a. Composition des machines. XXXIII, 428 p., 43 tav.: ill. Paris: Bachelier, 1818 9) BOULVIN, J. Cours de mécanique appliquée aux machines: professe a l'Ecole spéciale du génie civil de Gand. / J. Boulvin. 2. ed. Paris: E. Bernard, 1906 10) BOULVIN, J. 1. : Théorie générale des mécanisme. VIII, 279 p. : ill. 2. ed.

Paris : E. Bernard, 1906

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11) BOULVIN, J. 8.: Appareils de levage, transmission dutravail à distance. 248, XXX p.: ill. Paris : E. Bernard et C., 1899 12) BOUR, Edm. 1.: Cinématique. 318 p. Paris: Gauthier - Villars, 1865 13) CAVALLI, Ernesto: Elements of mechanics applied to machines / Ernesto Cavalli. Napoli, Italy: A.Trani, 1908 14) COLLIGNON, Edouard1.: Cinématique. IV, 504 p. : ill. Paris : Hachette et C., 1873 15) CONTALDI, Pasquale2.: Applied mechanics, resistance of materials, mechanics applied to machines, transmissions. 342 p. Fermo, Italy: Cooperative typographic establishment, 1906 16) CONTALDI, Pasquale 2.: Applied mechanics, resistance of materials, mechanics applied to machines, transmissions. Tavole. 44 tav. ill. Fermo, Italy: Cooperative typographic establishment, 1906 17) DE BIASE, Luigi. Course of mechanics applied to the machines / Luigi De Biase. Napoli, Italy: V. Bestito, 1914 18) DELAUNAY, Charles-eugene. Cours élémentaire de mécanique théorique et appliquée / Charles-Eugene Delaunay. 9. ed. rist.: Garnier freres : G. Masson, 1878 19) DORGEOT, E. Cinématique théorique et appliquée / E. Dorgeot. Paris : H. Dunod et E.Pinat, 1919 20) DULOS, Pascal 4: XI, 565 p.: ill. Paris: Gauthier Villars, 1879 21) DULOS, Pascal 5: 254 p.: ill. Paris: Gauthier- Villars, 1883 22) DWELSHAUVERS, V. Manuel de mécanique appliquée / V. Dwelshauvers.

Paris Liège : J. Baudry, 1866

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23) DWELSHAUVERS, V. 1.: CinÊmatique. III, 214, IV, p., 12 tav.: ill. ParisLiège: J. Baudry, 1866 24) FERRARO, Ernesto: Sunto of the lessons of mechanics applied to the machines and related drawing / dictated by Ernesto Ferraro; autographed for the care of the pupil Attilio Gallucci. Napoli, Italy: Lithography of the Trinacria, 1883 25) FERRARO, Ernesto 1. : Preliminaries. 207 p.: ill. Head to the front.: Naples R. School of applications for engineers - 2. Course - School year 1883-84 Napoli, Italy: Lithography of the Trinacria, 1884 26) FERRARO, Ernesto: Sunto of the lessons of mechanics applied to the machines and related drawing / dictated by Ernesto Ferraro; autographed for the care of the pupil Attilio Gallucci. Napoli, Italy: Lithography of the Trinacria, 1884 27) FERRARO, Ernesto 2: Examination of rigid elements 331 p. ill. Head to front: Naples - R. School of applications for engineers - 2. Course - School year 1883-84 Naples, Italy: Lithography of Trinacria, 1884 28) FERRARO, Ernesto 3.: Examination of rigid elements 223 p. ill. Head to front: Naples - R. School of applications for engineers - 2. Course - School year 1883-84 Naples, Italy: Lithography of Trinacria, 1884 29) FERRETTI, Pericle: Mechanics of Machines / Pericle Ferretti1 ed. Napoli, Italy: Raffaele Pironti, 1952 30) FERRETTI, Pericle: Mechanics of Machines / Pericle Ferretti. Napoli, Italy: Liguori, 1966 31) FERRETTI, Pericle1. : 440 p. : ill. Napoli, Italy: Library Liguori, 1960

32) FOPPL, August Vorlesungen uber technische Mechanik / August Foppl. 14 Auf. Munchen : Leibniz, 1948

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33) FOSCHI, Vittorio: Applied mechanical exercises / Foschi Vittorio Roma: Italian editions, 1943 34) FRISI, Paolo: Institutions of mechanics, hydrostatics of hydrometry and static architecture, and hydraulics for the use of directing school erected in Milan for architects, and for engineers / a.d.d. Fr. Frisi In Milan, Italy: Giuseppe Galeazzi, 1777 35) GOUARD, E. Cours élémentaire de mécanique industrielle: principes généraux, applications, exercices pratiques / parE. Gourd et G. Hiernaux; préface de Ferdinand Farjon. 2. éd. revue corrigée et augmentée Paris: H. Dunod et E. Pinat, 1914 36) GOUARD, E. 1. : VIII, 386 p.: ill. In testa al front.: Bibliothèque dell'enseignement technique2. éd. revue corrigée et augmentée Paris : H. Dunod et E. Pinat, 1914 37) GRANDS dessins coloriés pour l'enseignement de la mécanique / composés sous la direction de M. le général Morinet par le soins de Tresca. Paris : Librairie de L. Hachette et C., 1856

38) HABICH, E. j. Etudes cinématiques Paris : Gauthier Villars, 1879 39) Hachette, Jean Nicolas Pierre Traite élémentaire des machines Paris : J. Klostermann, 1811 40) HARTMANN, G. h. Les mécanismes / G. H. Hartmann. Paris : Librairie Bailliere, 1925

41) JULIA, Gaston

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Cours de cinématique / Gaston Julia ; redige par J. Dieudonné. Paris : GauthierVillars, 1928 42) LEONI, A. Industrial mechanics: lessons / by A. Leoni; collected for the care of students G. Merlini and A. Zani Milano, Italy: s..., 1891-92 (Typ. lit. G. Tenconi) 43) LEONI, Antonio Machine theory: lessons / by Antonio Leoni; collected by the pupil Gerolamo Merlini, Milano, Italy: s.e., 1891-1892 44) LEONI, A. 1 .: 205 p. : ill.In head to front .: RITS. Milan, Italy: s.e., 1891-92 (Typ. lit. G. Tenconi) 45) MORIN, Arthur Aide-mémoire de mécanique pratique / Arthur Morin. 4. éd.

Paris : L. Hachette et C., 1860 46) MORIN, Arthur Aide mémoire de mécanique pratique : à l'usage des officiers d'artillerie et des ingénieurs civils et militaires / par Arthur Morin. Bruxelles : Société belge de libraire, 1837 47) MORIN, Arthur Notions géométriques sur les mouvements et leurs transformation, ou éléments de cinématique / Arthur Morin. 3. éd. Paris : L. Hachette et C., 1861 48) MORIN, Arthur Aide-mémoire de mécanique pratique a l'usage des officiers d'artillerie et des ingénieurs civils et militaires / par Arthur Morin. 2. ed. Metz : Thiel : Le neveu, 1838 49) MORIN, Arthur Notions géométriques sur les mouvements et leurs transformation, ou éléments de cinématique / Arthur Morin. 3. éd. Paris : L. Hachette et C., 1861 50) NAVIER, Louis Marie Henri Summary of the lessons given to the School of Bridges and Roads on the application of mechanics to the construction and machinery plant / Louis Marie Henri Navier. Naples: From the printing house and paper mill of the Fibreno, 1836

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51) NAVIER, Louis-Marie Henri Résumé des leȯns : données à l’école des ponts et chaussées sur l'application de la mécanique à l'établissement des constructions et des machines / Louis-Marie Henri Navier ; 3. éd. avec des notes et des appendices par Barre de Saint-Venant. 3. éd. Paris : Dunod, 186452) NAVIER, Louis-Marie Henri Résumé des leȯns : données à l’école des ponts et chaussées sur l'application de la mécanique à l'établissement des constructions et des machines / Louis-Marie Henri Navier. A Paris: Carilian-Goeury, 1838 53) NAVIER, Louis-Marie Henri Résumé des leons : données à l’école royale des ponts et chaussées sur l'application de la mécanique àl'établissement des constructions et des machines / Louis-Marie Henri Navier Paris : Chez F. Didot, 1826 54) NAVIER, Louis-marie-henri1. : Translated on the 2. ed., Accompanied by the additions and an appendix on suspended bridges / by C. D. D'Andrea. XXXII, 584 p., 6 pl. : ill. Naples, Italy: From the printing house and paper mill of the Fibreno, 1836 55) NAVIER, Louis-marie-henri: XI, 428 p., 5 tav. : ill. Paris: Chez F. Didot, 182656) PANETTI, M. Mechanics applied to the machines / M. Panetti. Torino, Italy: University Publishing Library Levrotto e Bella, s.d.

57) PANETTI, M. 3. : Flexible. 208, III p. : ill. 4. ed. Torino, Italy: University Publishing Library Levrotto e Bella, s.d.

58) PERRY, John Applied mechanics : a tretise for the use of students who have time to work experimental, numerical, and graphical exercises illustrating the subject / John Perry ; new ed. revised and enlarged. London : Cassel and C., 1907 59) PERRY, John Mécanique appliquée : à l'usage des élèves qui peuvent travailler éxperimentalement et faire des éxercices numériques et graphiques / John Perry ;

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ouvrage traduit sur la neuvième édition anglaise par E. Davaux ; avec des addition et un appendice sur la mécanique des corps déformables par E. Cosserat , F. Cosserat. Paris : Librerie scientifique A. Herman et Fils, 1913 60) PETERSEN, Julius Kinematik : deutsche ausgäbe unter Mitwirkung des Verfassers besorgt von R. von Fischer-Benzon / Julius Petersen. Kopenhagen : A.F.Host und sohn, 1884 61) PISTOLESI, E. Mechanics applied to machines / E. Pistolesi. 10. ed. Florence, Italy : A. Vallerini, 1958 62) POLI, Cino General and applied mechanics / Cino Poli. Torino, Italy: UTET, 192763) POLI, Cino1. : Vector calculation, kinematics 611 p. : ill. Torino, Italy: UTET, 1927 64) REULEAUX, F. Le constructeur : tables, formules, règles, calculs, tracés et renseignements pour la construction des organes de machines : aide-mémoire à l'usage des ingénieurs, constructeurs, architectes, mécaniciens / F. Reuleaux ; éd. franȧise publié sur la 3. éd. allemande par A. Debieze et E. Merijot. Paris: F. Savy, 1875 65) REULEAUX, F. Le constructeur : principes, formules, tracés, tables et renseignements pour l'établissement des projets de machines, àl'usage des ingénieurs, constructeurs, architectes, mécaniciens / F. Reuleaux ; 3. éd. franȧise traduite de l'allemand sur la 4. éd. entièrement refondue et considérablement augmentée par A. Debize 3. éd. Paris: F. Savy, 1890 66) REULEAUX, F. Fundamental principles of a general machine theory / F. Reuleaux; authorized translation of Giuseppe Colombo Milan-Naples, Italy: U. Hoepli, 1874 67) REULEAUX, F. General machine theory: theoretical kinematics / F. Reuleaux. S.l. : s.e., 1874

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68) REULEAUX, Franz, 1829-1905 Cinématique : principes fondamentaux d'une théorie générales des machines / par F. Reuleaux ; traduit de l'allemand par A. Debize Paris Librairie F. Savy1877 69) RICCI, Carlo luigi: LESSONS OF MECHANICS APPLIED TO MACHINES / RICCI CARLO LUIGI, Pisa, Italy: National Union of Engineers, 1921 70) RUBINO, Mario: Mechanics applied to machines / Mario Rubino. 3. ed.

Milano, Italy: Principality, 1958 71) SCOTTO LAVINA, Giovanni Applications of mechanics of the machines / Giovanni Scotto Lavina. Milan, Italy: Tamburini, 1949 72) SCOTTO LAVINA, G. Summary of the mechanics lessons applied to the machines / G. Scotto Lavina. Rome, Italy: Siderea, 1970 73) TADDEI, Mario2. : 432 p. : ill. Napoli, Italy: Liguori, 1981 74) TADDEI, Mario3. : 318 p. : ill. Napoli, Italy: Liguori, 1981 75) TAFFE, A. Applications de la mécanique aux machines / A. Taffe ; 4. éd. revue, corrigée et augmentée de chapitres nouveaux par P. Boileau. 4. éd Paris : Libraire du dictionnaire des arts et manufactures, 1872 76) TESSARI, Domenico: The kinematics applied to machines: for use in application schools for engineers, engineers and mechanical constructors / Domenico Tessari. Turin, Italy: E. Loescher, 1890 77) WITTENBAUER, Ferdinand Aufgaben aus der technischen Mechanik / Ferdinand Wittenbauer ; 5. verbesserte auf. bearbeitet von Theodor Psochl. 5. verbesserte auf. Berlin: J. Springer, 1924 78) WITTENBAUER, Ferdinand Aufgaben aus der technischen Mechanik / Ferdinand Wittenbauer.3. verbesserte auf. Berlin : J. Springer, 1918

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B. II List by publication date 1)

FRISI, Paolo Institutions of mechanics, hydrostatics of hydrometry and static

architecture, and hydraulic for the use of directing school erected in Milan for architects, and for engineers / a.d. Fr. Frisi In Milan: Giuseppe Galeazzi, 1777 2)

Hachette, Jean Nicolas Pierre Traite elementaire des machines Paris: J.

Klostermann, 1811 3)

BORGNIS, J. a. Traité complet de mécanique appliquée aux arts : contenant

l'exposition méthodique des théories et des expériencesles plus utiles pour diriger le choix, l'invention, la construction et l'emploi de toutes les espèces de machines / par J. A. Borgnis Paris : Bachelier, 1818 4)

BORGNIS, J. a. Mouvements des fardeaux. XII, 335 p., 20tav.: ill. Paris :

Bachelier, 1818 5)

BORGNIS, J. a. Des machines employées dans les constructions diverses.

XII, 319 p., 26tav. : ill. Paris : Bachelier, 1818 6)

BORGNIS, J. a. Composition des machines. XXXIII, 428 p.,43 tav.: ill. Paris:

Bachelier, 1818 7)

NAVIER, Louis-Marie Henri Résumé des leons: données à l’école royale des

ponts et chaussées sur l'application de la mécanique àl'établissement des constructions et des machines / Louis-Marie Henri Navier Paris: Chez F. Didot, 1826 8) 1826

NAVIER, Louis-marie-henri1. : XI, 428 p., 5 tav.: ill. Paris: Chez F. Didot,

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9)

NAVIER, Louis Marie Henri Summary of the lessons given to the School of

Bridges and Roads on the application of mechanics to the construction plant and machines / Louis Marie Henri Navier. Naples: From the printing house and paper mill of the Fibreno, 1836 10) NAVIER, Louis-marie-henri1. : Translated on 2. ed., Accompanied by notes and additions and an appendix on suspended bridges / by C. D. D'Andrea. XXXII, 584 p., 6 pl. : ill. Naples: From the printing house and paper mill of the Fibreno, 1836 11) MORIN, Arthur Aide mémoire de mécanique pratique : à l'usage des officiers d'artillerie et des ingénieurs civils et militaires / par Arthur Morin. Bruxelles : Société belge de libraire, 1837 12) MORIN, Arthur Aide-mémoire de mécanique pratique a l'usage des officiers d'artillerie et des ingenieurs civils et militaires / par Arthur Morin. 2. ed. Metz : Thiel : Le neveu, 1838 13) NAVIER, Louis-Marie Henri Résumé des le ns : données à l’école des ponts et chaussées sur l'application de la mécanique à l'établissement des constructions et des machines / Louis-Marie Henri Navier. A Paris: Carilian-Goeury, 1838 14) GRANDS dessins coloriés pour l'enseignement de la mécanique / composés sous la direction de M. le général Morin et par le soins de Tresca. Paris : Librairie de L. Hachette et C., 1856 15) MORIN, Arthur Aide-mémoire de mécanique pratique / Arthur Morin. 4. éd.

Paris : L. Hachette et C., 1860

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16)

MORIN, Arthur Notions géométriques sur les mouvements et leurs

transformation, ou éléments de cinématique / Arthur Morin. 3. éd. Paris : L. Hachette et C., 1861 17)

MORIN, Arthur Notions géométriques sur les mouvements et leurs

transformation, ou éléments de cinématique / Arthur Morin. 3. éd. Paris : L. Hachette et C., 1861 18) NAVIER, Louis-Marie Henri Résumé des le ns : données à l’école des ponts et chaussées sur l'application de la mécanique à l'établissement des constructions et des machines / Louis-Marie Henri Navier ; 3. éd. avec des notes et des appendices par Barre de Saint-Venant. 3. éd. Paris: Dunod, 1864 19) BELANGER, J. b. Traité de cinématique / J. B. Bélanger. Paris : Gauthier Villars, 1864 20) BOUR, Edm. 1. : Cinématique. 318 p. Paris : Gauthier Villars, 1865 21) DWELSHAUVERS, V. Manuel de mécanique appliquée / V. Dwelshauvers.

Paris Liège : J. Baudry, 1866 22) DWELSHAUVERS, V. 1. : Cinématique. III, 214, IV, p., 12 tav.: ill. Paris Liège : J. Baudry, 1866 23) TAFFE, A. Applications de la mécanique aux machines / A. Taffe ; 4. éd. revue, corrigée et augmentée de chapitres nouveaux par P. Boileau. 4. éd Paris: Libraire du dictionnaire des arts et manufactures, 1872 24) BOIDI, Giuseppe a. The mechanical constructor engineer, ie course of practical theoretical drawing of the machines / Giuseppe A. Boidi. Turin: V. Bona, 1873

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25) BOIDI, Giuseppe a. 1. : Terms used in particular to practical mechanics. XVI, 427, 31 p. : ill. Turin: V. Bona, 1873 26) COLLIGNON, Edouard1. : Cinématique. IV, 504 p. : ill. Paris: Hachette et C., 187327) REULEAUX, F. Fundamental principles of a general machine theory / F. Reuleaux; authorized translation of Giuseppe Colombo Milan-Naples: U. Hoepli, 1874) 28) REULEAUX, F. General machine theory: theoretical kinematics / F. Reuleaux.

S.L. : e.e., 1874 29) REULEAUX, F. Le constructeur : tables, formules, règles, calculs, tracés et renseignements pour la construction des organes de machines : aide-mémoire à l'usage des ingénieurs, constructeurs, architectes, mécaniciens / F. Reuleaux ; éd. fran ise publié sur la 3. éd. allemande par A. Debieze et E. Merijot. Paris: F. Savy, 1875 30) REULEAUX, Franz, 1829-1905 Cinématique : principes fondamentaux d'une théorie générales des machines / par F. Reuleaux ; traduit de l'allemand par A. Debize Paris Librairie F. Savy1877 31) DELAUNAY, Charles-eugene Cours élémentaire de mécanique théorique et appliquée / Charles-Eugene Delaunay. 9. ed. ris : Garnier frères : G. Masson, 1878 32) HABICH, E. j. Etudes cinématiquesParis: Gauthier-Villars, 1879 33) DULOS, Pascal 4. : XI, 565 p. : ill. Paris : Gauthier-Villars, 1879 34) DULOS, Pascal 5. : 254 p. : ill. Paris : Gauthier- Villars, 1883

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35) FERRARO, Ernesto Summary of the lessons of mechanics applied to the machines and related drawing / dictated by Ernesto Ferraro; autographed for the care of the pupil Attilio Gallucci. Naples: Lithography of the Trinacria, <1883> 36) FERRARO, Ernesto1. : Preliminaries. 207 p. : ill.In head to front .: Naples R. School of applications for engineers - 2. course - school year 1883-84 Naples: lithography of Trinacria, 1884 37)

FERRARO, Ernesto Sunto of the lessons of mechanics applied to the

machines and related drawing / dictated by Ernesto Ferraro and autographed by Attilio Gallucci. Naples: Lithography of the Trinacria, 1884 38) FERRARO, Ernesto2. : Esame di elementi rigidi. 331 p. : Ill. Testa a fronte: Napoli - R. Scuola di domande per ingegneri - 2 ° corso - Anno scolastico 1883-84 Napoli: Litografia della Trinacria, 1884 39) FERRARO, Ernesto 3: Examination of ductile elements. 223 p. : Ill. Heading front: Naples - R. School of applications for engineers -2. course - School year 1883-84 Naples: Lithography of Trinacria, 1884 40) PETERSEN, Julius Kinematik : deutsche ausgabe unter mitwirkung des verfassers besorgt von R. von Fischer-Benzon / Julius Petersen. Kopenhagen: A.F.Host und sohn, 1884 41) REULEAUX, F. Le constructeur : principes, formules, tracés, tables et renseignements pour l'établissement des projets de machines, àl'usage des ingénieurs, constructeurs, architectes, mécaniciens / F. Reuleaux ; 3. éd. fran ise traduite de l'allemand sur la 4. éd. entièrement refondue et considérablement augmentée par A. Debize 3. éd. Paris: F. Savy, 1890

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42) TESSARI, Domenico The kinematics applied to the machines: for use in application schools for engineers, engineers and mechanical constructors / Domenico Tessari. Turin: E. Loescher, 1890 43) LEONI, A. Meccanica industriale : lessons / by A. Leoni; collected for the care of students G. Merlini and A. Zani Milano: s..., 1891-92 (Typ. lit. G. Tenconi) 44) LEONI, Antonio Machine theory: lessons / by Antonio Leoni; collected by the student Gerolamo Merlini Milano: s.e., 1891-1892 45) LEONI, A. 1.: 205 p. : ill.In testa al front.: RITS. Milano: s.e., 1891-92 ( Tip. lit. G. Tenconi) 46) BOULVIN, J. 8. : Appareils de levage, transmission du travail à distance. 248, XXX p. : ill. Paris : E. Bernard et C., 1899 47)

BOULVIN, J. Cours de mécanique appliquée aux machines : professe a

l'Ecole spéciale du génie civil de Gand. / J. Boulvin. 2. ed. Paris: E. Bernard, 1906 48)

BOULVIN, J. 1. : Theorie generale des mecanisme. VIII,279 p. : ill. 2. ed.

Paris : E. Bernard, 1906 49) CONTALDI, Pasquale2. : Applied mechanics, resistance of materials, mechanics applied to the machines, transmissions. 342 p. Fermo: Cooperative typographical plant, 1906 50) CONTALDI, Pasquale 2. : Applied mechanics, resistance of materials, mechanics applied to machines, transmissions. Tables. 44 table : Ill. Fermo: Cooperative typographical plant, 1906

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51) PERRY, John Applied mechanics : a tretise for the use of students who have time to work experimental, numerical, and graphical exercises illustrating the subject / John Perry ; new ed. revised and enlarged. London: Cassel and C., 1907 52) CAVALLI, Ernesto Elements of mechanics applied to the machines / Ernesto Cavalli. Naples: A.Trani, 1908 53) PERRY, John Mécanique appliquée : à l'usage des élèves qui peuvent travailler éxperimentalement et faire des exercices numériques et graphiques / John Perry ; ouvrage traduit sur la neuvième édition anglaise par E. Davaux ; avec des addition et un appendice sur la mécanique des corps deformables par E. Cosserat , F. Cosserat. Paris : Librerie scientifique A. Herman et fils, 1913 54) DE BIASE, Luigi Course of mechanics applied to the machines / Luigi De Biase. Napoli : V. Bestito, 1914 55) GOUARD, E. Cours élémentaire de mécanique industrielle : principes généraux, applications, exercices pratiques / parE. Gouard et G. Hiernaux ; préface de Ferdinand Farjon. 2. éd. revue corrigée et augmentée Paris: H. Dunod et E. Pinat, 1914 56) GOUARD, E. 1. : VIII, 386 p. : ill.In testa al front.: Bibliothèque del'enseignement technique2. éd. revue corrigée et augmentée Paris: H. Dunod et E. Pinat, 1914 57)

WITTENBAUER, Ferdinand Aufgaben aus der technischen Mechanik /

Ferdinand Wittenbauer. 3. verbesserte auf. Berlin : J. Springer, 1918 58) BOCQUET, J. A. Elementary course in applied mechanics / J. A. Bocquet; translation by F. Sinigaglia. 4. ed. Naples: Pellerano Scientific and Industrial Library, 1919

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59) DORGEOT, E. Cinématique théorique et appliquée / E. Dorgeot. Paris : H. Dunod et E. Pinat, 1919 60) RICCI, Carlo Luigi LESSONS OF MECHANICS APPLIED TO THE MACHINES / RICCI CARLO LUIGI Pisa: National Union of Engineers, 1921 61) HARTMANN, G. h. Les mécanismes / G. H. Hartmann. Paris : Librairie Bailliere, 1925) 62) WITTENBAUER, Ferdinand Aufgaben aus der technischen Mechanik / Ferdinand Wittenbauer ; 5. verbesserte auf. bearbeitet von Theodor Psochl. 5. verbesserte auf. Berlin : J. Springer, 1924 63) POLI, Cino General and applied mechanics / Cino Poli. Torino: UTET, 1927 64) POLI, Cino1. : Vector calculation, kinematics 611 p.: ill. Torino: UTET, 1927 65) JULIA, Gaston Cours de cinématique / Gaston Julia ; rédige par J. Dieudonné.

Paris: Gauthier Villars, 1928 66) FOSCHI, Vittorio Applied mechanical exercises / Foschi Vittorio Roma : Italian editions, 1943 67) FOPPL, August Vorlesungen uber technische Mechanik / August Foppl. 14 Auf. Munchen : Leibniz, 1948 68) SCOTTO LAVINA, Giovanni Mechanical applications of the machines / Giovanni Scotto Lavina. Milano : Tamburini, 1949 69) PANETTI, M. Mechanics applied to the machines / M. Panetti. Torino : University publishing library Levrotto e Bella, s.d.

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70) PANETTI, M. 3. : Flessibili. 208, III p. : ill. 4. ed. Torino: University publishing library Levrotto e Bella, s.d.

71) FERRETTI, Pericle Mechanics of Machines / Pericle Ferretti1 ed. Napoli : Raffaele Pironti, 1952 72) PISTOLESI, E. Mechanics applied to the machines / E. Pistolesi. 10. ed.

Firenze : A. Vallerini, 1958 73) RUBINO, Mario Mechanics applied to the machines / Mario Rubino. 3. ed.

Milano : Principato, 1958 74) FERRETTI, Pericle1. : 440 p. : ill. Napoli : Libreria Liguori, 196075) FERRETTI, Pericle Mechanics of the machines / Pericle Ferretti. Napoli : Liguori, 1966 76) SCOTTO LAVINA, G. Summary of the lessons of mechanics applied to the machines / G. Scotto Lavina. Roma : Siderea, 1970 77) TADDEI, Mario2. : 432 p. : ill. Napoli : Liguori, 1981 78) TADDEI, Mario3. : 318 p. : ill. Napoli : Liguori, 1981

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B. III List of authors in chronological order HACHETTE 1811

BORGNIS 1818

BABBAGE 1834 NAVIER 1836 1864

1838 1826 GRANDS 1856

MORIN 1861 1860 1837 1861

REDTENBACHER 1861

1872 1868 LABOULAYE 1864

BELANGER 1864

BOUR 1865

DWELSHAUVERS

1866 TAFFE 1872

COLLIGNON 1873

BOIDI 1873

HATON DE LA

GOUPILLIERE 1874 PONCELET 1874 1876

KELLER 1874

REULEAUX 1875 1890 1874

1877 RANKINE 1877

DELAUNENAY 1878 HABICH 1879

DULOS 1879

1883 FERRARO 1883 1884 MASI 1897

PETERSEN 1884

BOULVIN 1899 1906

PERRY 1907 1913

CAVALLI 1908

TESSARI 1890

CONTALDI 1906

LEONI 1891-92 WEVE 1907

GABRIEL 1911 1913

DE BIASE

1914 GOUARD 1914

BRUNELLI 1916 DORGEOT 1919

WITTENBAUER 1924 FOPPL 1948

HARTMANN 1925

BOCQUET 1919

POLI 1927

JULIA 1928

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PANETTI TADDEI 1981

PISTOLESI 1958

FERRETTI 1960 1966

TOLLE 1961

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B. IV List of authors in alphabetical order BABBAGE (1834)

BELANGER (1864) BOCQUET (1919)

BOIDI (1873)

BORGNIS (1818) BOULVIN (1899 1906) COLLIGNON

(1873)

BOUR (1865) BRUNELLI (1916) CAVALLI (1908) CONTALDI

(1906 1913)

DE BIASE

(1914)

DWELSHAUVERS

(1866)

DELAUNENAY (1878) DORGEOT

(1919)

DULOS

(1879 1883)

FERRARO (1883 1884) FERRETTI (1960 1966) FOPPL (1948) GABRIEL (1911) GRANDS (1856)

HABICH (1879)

GOUARD (1914)

HACHETTE (1811)

HARTMANN

(1925) HATON DE LA COUPILLIERE (1874) JULIA (1928) KELLER (1874) LABOULAYE (1864) LEONI (1891-92)

MASI (1897) MORIN (1861 1860

1837) NAVIER (1836 1864 1838 1826)

PANETTI

PERRY (1907 1913)

PETERSEN (1884) PISTOLESI (1958)

POLI (1927)

PONCELET (1874 1876 1861)

RANKINE

(1877) REDTENBACHER (1861 1872 1868) REULEAUX (1875 1890 1874 1877) TAFFE (1872)

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TADDEI

(1981)

TESSARI

WITTENBAUER (1924)

(1890)

TOLLE

(1961)

WEVE (1907)

Publication list

H Research Edition English: publication 05 magazine number 2019-20

INVESTMENT COMPANY, UCITS, GEFIA. CREDIT RATINGS SFT transparency obligation

publication 2019-20 05

1 – INTRODUCTION

2 – REGULATION ON THE TRANSPARENCY OF FINANCING OPERATIONS THROUGH SECURITIES AND RE-USE

2.1 – Securities Financing Transactions (SFT): Regulation (EU) 2015/2365 2.2 – Credit Default Swap: EU regulation 236/2012

3 – UNDERTAKINGS FOR COLLECTIVE INVESTMENT IN TRANSFERABLE SECURITIES

3.1 – Introduction 3.2 – Collective investment company: UCITS directive, (UCITS)

4 – INVESTMENT COMPANY: DIRECTIVE (EU) 2014/65

5 – ALTERNATIVE INVESTMENT FUNDS: DIRECTIVE (EU) 2011/61 GEFIA

5.1 – Directive (EU) 2011/61 GEFIA 5.2 – Credit Rating: Regulation (EC) 1060/2009

Author: engineer Vito Gnazzo

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Obbligo di trasparenza STF.

SocietĂ di investimento, OICVM, GEFIA. Rating del credito.

In publication 2019-20.05 we dealt with the Securities Financing Transactions (SFT) that until 2014 were not regulated by any legislation.

We have turned our attention to Regulation (EU) 2015-2365 which also modifies the regulation (EU) 648/2012 of interest for OTC derivatives, the latter regulation, which among the different rules introduces the obligation of a CCP counterparty and the related conditions of derogation from the obligation. Being the subject of the Securities Financing Transactions the investment funds regulated by the Undertakings for Collective Investment directives in Transferable Securities (UCITS) we have carried out a study of Directive 2009/65/EC and Directive 2014/91/EU which define the current regulatory legislation for the UCITS, with a look at the previous regulations. In identifying the related legislative framework, we carried out research and studies in separate paragraphs identifying the legislation that establishes the obligations for the access of collective investment companies of funds raised among the public, the related management companies, paying attention mainly to the current rules. in force and how they have been changed to date. We have carried out further research and studies with reference to investment companies to the relative requirements for the provision of investment services, capital adequacy, the conditions that allow the provision of investment services to be waived from the legislation defined by the provisions of Directive (EU) 2014/65, directive defining investment services and activities, ancillary services, financial instruments and data communication services. We were interested in the 2011/61/EU directive and subsequent updates that regulate the management companies of the alternative investment funds GEFIA, immediately observing that the AIFs, unlike the management companies, do not have a harmonized regulation given the impossibility

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caused by the diversification of the financial instruments that build the FIAs themselves in different European and non-European countries.

Finally, we were interested in credit rating companies, their importance in financial investments, their evolution both globally and in Europe, with a look at their criticality, roles and consequences of their credit ratings in the economy.

1 - INTRODUCTION With a generic definition of Securities Financing Transactions (STF) is defined SFT as any type of transaction in which securities are used to lend money and vice versa. As an example we can refer to sell / buy back transactions, repurchase agreements, securities lending activities. In each of these, the ownership of the securities changes temporarily, in exchange for cash, and then reversed again at the end of the operation.

The buy-back (or repurchase of own shares) is the purchase of treasury shares from a public limited company. For Italian legislation, for example, the rule defined by Article 2357 of the Italian Civil Code imposes a limit on treasury shares in portfolio, a limit of 20% of the total share capital and in compliance with accounting and accounting principles international, the nominal amount of treasury shares, recorded at historical cost or at fair value, must be allocated to a specific reserve for treasury shares; it is shown in the balance sheet under the equity item, in the net equity within the liabilities (liability and equity items). The consequence of the global financial crisis of 2008, the great recession(1°), is that buy-back transactions have also spread to other financial instruments, such as bonds, and to public law subjects, in particular, with the repurchase of sovereign debt securities by Central Banks aimed at preventing bonds from remaining unsold and avoiding a reduction in demand.

Repurchase agreements (PCT op/t) defined as contracts in which a seller (usually a bank) sells, in exchange for money, a certain number of securities to a buyer with immediate delivery, then "spot", and commits to same deed, on the repurchase of the securities sold by the same purchaser at a price generally higher and at a predetermined date; delivery is in the future so the

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contract is "forward (to term)". The transaction consists of a loan of money by the buyer and a loan of securities by the seller.

Securities lending is a very common practice in the UCITS fund industry (Undertakings for Collective Investment in Transferable Securities) ), this is an operation in which the fund lends a portion or all of the securities held in the portfolio to an external counterparty (the percentages vary from issuer to issuer), with the latter's commitment to return them at a predetermined future date . The fund in return receives a remuneration that, with different percentages from ETF to ETF (also in this case the range of cases are large), is divided between the manager and the fund itself. Exchange Traded Funds (ETFs) are special passive managed funds (or SICAVs). As with all funds, buying an ETF is like buying a basket of stocks. Investing in a fund means putting your savings together with that of other investors, the fund manager will then purchase the instruments on which you will invest. The investment performance will be given by the result of all the individual instruments on which the fund invests . With reference to the lending operations, the remuneration received by the counterparty fund allows the ETF to cover part of the total annual commissions by reducing the tracking error ( the performance deviation of a financial asset just like the fund of investment with respect to its benchmark, an objective reference parameter, established by referring to financial indicators developed by third parties and of common use, as may be the stock indices or the synthesis of the value of the basket of stocks they represent, therefore the total value of the basket calculated from the value of the individual shares that compose it, the price, depending on weighting factors that take into account according to the index of the market capitalization of the issuing companies, or CSR assessments of socioenvironmental type ). When an ETF engages in a securities lending transaction, temporarily waiving the availability of the securities, a counterparty risk emerges with the person with whom the transaction was concluded for the percentage of the assets involved in the transaction. In fact, in the event that this counterparty should fail the fund may not get back the securities lent, incurring in a loss. In order to reduce this risk, ETF issuers require the counterparty to constitute a collateral deposit for the duration of the transaction. This collateral is usually deposited in an account of a custodian bank opened in the name of the counterpart on which a pledge is placed in favor of the fund. According to the CESR guidelines on risk measurement, the risk per individual net counterparty generated by securities lending transactions must be included within the limit of 20% provided for in paragraph 2 of article 52 of Directive 2009/65/EC (directive on which we will return to the following paragraphs) while the requirements for the composition

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of the collateral are left to the national regulation of domiciliation of the fund.

In general, the exposure to the counterparty is over collateralised and monitored on a daily basis because if the exposure becomes positive, the counterparty is required to reinstate the collateral (canceling the exposure). In the event of bankruptcy of the counterparty with whom the securities lending operation is carried out, the manager has the right to recover on the collateral, bringing it into its availability and then proceeding with its liquidation. It must be considered that the methods and times for exercising this option do not always guarantee that the money obtained is sufficient to cover the percentage of the value of the fund subject to the securities lending transaction.

(1°) NOTE: the great recession is a global economic crisis that starts in the United States of America in 2007 following a crisis in the real estate market triggered by the bursting of a, real estate bubble (subprime crisis) producing a serious financial crisis in the American economy. Subprime loans (Subprime lending) are loans that in the US financial context are granted to subjects who can not access the interest rates of the markets, for previous problems in his debtor history; they are obviously a form of risky loans for both creditors and debtors, following the dangerous combination of high interest rates, the bad credit history of the debtor and unclear or difficult to document financial dynamics. The recession then gradually assumed a global character, driven by financial mechanisms of contagion, and persisting (with some exceptions such as India and China) with the recessionary spiral that has worsened further, in several European countries (Mediterranean Europe and others), with the debt crisis of European sovereign states. The main factors of the crisis include the high prices of raw materials (oil in the first place), a global food crisis, the threat of a worldwide recession and a credit crisis (followed by the banking crisis) resulting in a collapse confidence in stock market. It is considered by many economists as one of the worst economic crises in history, second only to the great depression of the early twentieth century (also called the crisis of 1929, great crisis or collapse of Wall Street). In 2006 the first signs of the great economic crisis because US savers began not to pay the mortgage installments, a context that worsened in 2008 causing a ponderous increase in foreclosures; the determining cause was the speculative, excessive dynamics of the real estate market in the United States, which occurred with the sharp rise in house prices and the subsequent expansion of investments in the sector. The indebtedness of US households led to the explosion of property prices starting in the first years before 2006, and an increase in debt as real property values increased; the subsequent fall in prices, in 2007-2008 caused a positive difference

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between the value of the mortgage and the value of real estate, the guarantee of the mortgage itself. It is clear that families invested in a growing increase in value of real estate without considering the possibility of overturning the market. Amplification of the positive difference are the dynamics triggered by the reactions from banks that began to sell the dumbs to third parties (credit assignment, securitization) through various financial instruments by downloading on other subjects the risks incurred and causing a deterioration of the financial system because the financial instruments spread in the system, were burdened by a positive difference between the relative value and the real estate guarantees in support, a difference that made them strongly exposed to the devaluation and that occurring between 2007 and 2008 triggered economic difficulties in some of the largest American credit institutions; Bear Stearns, Lehman Brothers and AIG were collapsed and then secured by US Treasury intervention with the Fed. Also European banks were invested by the devaluation of real estate securities, subsequently being nationalized or forced to recapitalize (increase in capital through reserves, own funds, contribution from shareholders). After several months of weakness and loss of loans, the phenomenon collapsed between 2007 and 2008 causing bank and financial entities to bankrupt and causing a sharp reduction in stock market values and the ability to consume and save for the population, with effects immediately recession on the economy.

2 - REGULATION ON THE TRANSPARENCY OPERATIONS THROUGH SECURITIES AND RE-USE

OF

FINANCING

2.1 - Securities Financing Transactions (SFT): Regulation (EU) 2015/2365 The EU dealt with Securities Financing Transactions (SFT) in a context of overall review of transparency in financial markets, because until 2015 they were not covered by any legislation. The regulatory proposal dates back to January 29, 2014, which became Regulation (EU) 2015/2365 "on the transparency of securities financing transactions and related re-use and wich

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amending regulation (EU) 648/2012 on OTC derivatives, central counterparties and trade repositories ". Excessive speculation, the existence of serious regulatory gaps in the financial system, ineffectiveness of supervision, market opacity and the excessive complexity of financial products contributed to the global crisis that took place between 2007 and 2008. A series of measures, they are adopted by the Union to increase the soundness and stability of the banking system, including the reinforcement of capital requirements, standards for improving governance, supervision and resolution arrangements, aimed at ensuring that the financial system its role of allocating capital to the financing of the real economy; the creation of the Banking Union has brought decisive progress in this direction. The same crisis has highlighted the need to improve transparency and control in both the traditional banking sector and in sectors in which credit intermediation similar to banking takes place, known as the "shadow banking system" , an alarming sector that, according to estimates, is equivalent to about half of the regulated banking system; from this sizing it is obvious that the entire financial sector could be contaminated by the deficiencies related to unregulated credit intermediation, activities similar to those carried out by banks. With the EU regulation 2015-2365 the possible reduction of transparency related to unregulated credit activities is considered as a result of the structural reform of the banking sector of the Union because some activities carried out by traditional banks can migrate to the shadow banking sector and involve financial entities and non-financial, a dynamic that highlights the necessary international convergence towards greater transparency of unregulated transactions, an objective envisaged by the same regulation. The Commission's concern is the fact that "SFTs are widely used by managers of collective investment schemes for efficient portfolio management. Therefore, investments made on the basis of incomplete or inaccurate information about the investment strategy of the collective investment scheme can cause significant losses for investors, therefore it is essential that the collective investment undertakings communicate all the detailed information relevant to the use of SFTs and total return swaps; The same Commission specifies with the regulation that "the complete information on SFTs and total return swaps is an essential safeguard against possible conflicts of interest" since the assets allocated to TFS and Total Return Swap ( TRS) they are owned from investors and not by the managers of collective investment schemes (safeguarding the interests of investors thus avoiding the interests of the managers to the detriment of investors). A total return swap is an interest rate swap contract, based on which two counterparties undertake to reciprocally exchange a flow of interest at a fixed rate and one at a floating rate denominated in the same currency.

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For example, a counterparty transfers to the other the interest rate of the security plus the possible appreciation of the security, the other gives the former the possible depreciation of the security plus an interest rate linked to a market indicator such as Euribor. With more technical terms, the Total Return Swap can be described as an operation whereby a subject total return payer (protecion buyer) transfers to another subject total return receiver (protection seller) all the risk and return of an underlying asset (reference assets), against a flow that is paid at certain deadlines. The periodic monetary flow is linked to a market indicator added to a spread (Euribor + TRS Spread). The Total Return Swap differs from the structure of the credit default swap because it is based on an exchange of flows that is more complex than the simple periodic payment of a sum in exchange for protection against the default risk of the security. In the figure below, the total return swap scheme (source: wikipedia.org) .

Within the framework of work to limit the shadow banking system, the FSB Financial Stability Board (2°) and the European Systemic Risk Board (CERS (2°) established by Regulation (EU) 1092/2014 of the European

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Parliament and of the Council have identified the risks posed by securities financing transactions (SFTs), as a result confirms that the SFTs accumulate leverage financial, pro-cyclicity and interconnection in the financial markets; in particular, the work highlighted the lack of transparency in the use of SFTs preventing regulatory and supervisory authorities, as for investors, from correctly assessing and monitoring risks similar to bank risks and the level of interconnection in the financial system in the period before the financial crisis or during the crisis itself. In this context, on 29 August 2013, the FSB adopted a strategic framework entitled "Strengthening the supervision and regulation of the shadow banking system" (FSB's strategic framework) on the risks associated with securities lending and repurchase transactions in the shadow banking sector, endorsed by the G20 leaders in September 2013. Following the publication of the Green Paper on the shadow banking system, published by the European Commission on 19 March 2012 on the basis of numerous contributions received and taking into account developments at international level, on 4 September 2013, the FSB, presents a communication to the Council and the European Parliament entitled The shadow banking system: addressing new sources of risk in the financial sector, which stresses that the complex and opaque nature of SFTs makes it difficult to identify counterparties and monitor risk concentration and also determines the excessive use of leverage in the financial system.The Green Paper is a communication by which the European Commission illustrates the state of a given sector to be regulated and clarifies its point of view regarding certain problems; it is part of the so-called "atypical acts" envisaged but not regulated by the EEC Treaty, this type of communication can be informative, decisive, declarative or interpretative, and is subject to the advertising regime.

According to the official definition of the European Union, the Green Papers are reflection papers on a specific policy topic published by the Commission.

First of all, documents intended for all those - both organisms and individuals - who take part in the process of consultation and debate. In Italy, for example, these documents are also published by regional administrations and the government. Initially the chosen color was white: so much so that the first publication similar to the current green book was published in May 1984 and is entitled Television without frontiers: white book on the establishment of the common market for radio and television broadcasts, especially via satellite and via cable. Subsequently a white paper meant a document containing action proposals.

(2°) NOTE: FSB, the Financial Stability Board (in English Financial Stability Board, until 2009: Financial Stability Forum) is an international body with the task of monitoring the global financial system. All the G20 countries

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(represented by both their own governments and their respective central banks), Spain and the European Commission are represented in this body, as well as Saudi Arabia, Argentina, Brazil, China, Korea, India, Indonesia, Mexico, Russia, South Africa and Turkey (source). It has its headquarters in Basel. This body is the evolution of the already existing Financial Stability Forum (FSF), with the aim of promoting the stability of the international financial system, improving the functioning of financial markets and reducing systemic risk, through the exchange of information and international cooperation among Supervisory authorities, central banks, the main supranational organizations. At the Bonn meeting in February 1999, the Finance Ministers and Governors of the Central Banks of the countries of the Group of Seven (G-7) agreed, on the recommendation of the then Bundesbank Governor Hans Tietmeyer, the establishment of an institutional entity appointed to increase cooperation between regulators and national and supranational supervisory authorities, calling it the Financial Stability Forum (FSF). The FSF team included the national supervisory authorities of Australia, Canada, France, Germany, Japan, Hong Kong, Italy, the Netherlands, United Kingdom, Singapore, United States, Switzerland. Also participating were some international organizations such as the World Bank, the ECB, the BIS, the IMF, the OECD and the bodies responsible for issuing international accounting standards.

CERS, the European Systemic Risk Board (in English, European Systemic Risk Board-ESRB) is a European Union agency, headquartered in Frankfurt, responsible for macro-prudential supervision of the Union's financial system.

The Council of the EU approved the establishment of the new agency in the meeting of 18 and 19 July 2009. In 2008 the President of the European Commission, José Manuel Barroso, established an independent group of experts led by Jacques de Larosière. In November 2008, the group met for the first time and, at the end of February 2009, prepared a report presenting to the European Commission some recommendations to strengthen the surveillance of the European financial system. The recommendations of the Larosière Group report are accepted and transformed into operational indications by the Community bodies. The Council of the European Union at its meeting of 18 and 19 July 2009 approved the creation of a European Systemic Risk Board or ESRB (European Systemic Risk Board) for the monitoring of financial stability at European level. At the same time the Council also approved the establishment of three new European authorities which together constitute the Joint Committee of the European Supervisory Authorities:

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The European Banking Authority (in English, European Banking Authority EBA) for the supervision of the banking market; The European Insurance and Occupational Pensions Authority (EIOPA) for the surveillance of the insurance market; The European Securities and Markets Authority (European Securities and Markets Authority - ESMA) for the surveillance of the securities market.

The legislation establishing the European Systemic Risk Board enters into force on 16 December 2010. The ESRB together with the three European authorities and the Member State authorities form the European System of Financial Supervision (SEVIF).

The European Systemic Risk Board is based in Frankfurt and the functioning of its Secretariat is guaranteed by the European Central Bank. The Committee is an independent body of the EU with the task of monitoring the macro-prudential stability of the EU financial system. The Committee helps to prevent and mitigate the systemic risks to the financial stability of the Union which originate within the same European system. The Committee also has the task of contributing to the correct and regular functioning of the internal market and ensuring that the financial system contributes in a sustainable manner to the economic growth of the Union. The organs of the Committee are: the General Council, the Steering Committee, the Secretariat (edited by the ECB), the Scientific Advisory Committee, the Technical Advisory Committee. The strategic objective of the Committee is that of macroprudential oversight of the European Union's financial system and the prevention or mitigation of the systemic risk that may originate within the European financial system. Furthermore, the Committee must contribute to the correct and regular functioning of the Union's single market and ensure that the financial sector contributes to economic growth. To achieve this strategic objective, the European legislation assigned to the Committee a series of institutional tasks: analyzing and studying the relevant information identifying potential systemically important risks - communicating, if necessary publicly, the risks that are considered relevant - issuing recommendations, if necessary also publicly, so that corrective measures are taken in response to the reported risks - coordinating its actions with those of international organizations, in particular the International Monetary Fund, the Financial Stability Board and all the authorities belonging to third countries involved in surveillance and macroprudential analysis.

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With the 2015-2365 regulation, the European Commission responds to the need to increase the transparency of the securities markets and therefore of the financial system, a regulation that follows the FSB's strategic framework to ensure equal conditions of competition and international convergence. It creates a Union regulatory framework in which information from SFTs can be efficiently reported to trade repositories and information on such transactions and total return swaps are disclosed to investors in collective investment schemes; a data repertoire is a legal entity established in the European Union and registered at ESMA (ESMA in Italian) or recognized by ESMA if established in a third country. The definition of SFT in this regulation does not include derivative contracts as set out in Regulation (EU) no. 648/2012 of the European Parliament and of the Council; it includes the operations commonly known as liquidity swaps and swaps with collateral, which do not fall within the definition of derivative contracts pursuant to Regulation (EU) no.

648/2012. In defining the new regulation, the European Commission took into account the evolutionary state of market practices and technology that allows market participants to make use of transactions other than securities financing, liquidity management and collateral, as a strategy income enhancement, to cover short selling or for tax arbitrage on dividends, transactions that could have an economic effect equivalent to SFTs compared to the risks posed, including the procyclicality induced by fluctuating asset values and volatility, transformations maturity or liquidity deriving from the financing of long-term or illiquid assets through short-term or liquid assets, and the financial contagion due to the interconnections of the chains of transactions that entail the re-use of collateral. Consideration is given to the dynamics that could be established between Member States following the adoption of the banking sector's structural reform based on the issues raised by the FSB's strategic framework, dynamics that would induce the Member States to adopt divergent national provisions which would hinder the smooth functioning of the internal market to the detriment of market participants and financial stability; moreover, due to the lack of harmonized transparency rules, national authorities have difficulty comparing micro-level data from different Member States and thus understanding the real risks that individual market participants pose to the system. The EU regulation 20152365 has among others intends to avoid creating distortions and obstacles in the Union due to the lack of harmonized transparency rules between Member States; as a consequence, the appropriate legal basis for this regulation should be Article 114 of the Treaty on the Functioning of the European Union (TFEU), interpreted in accordance with the settled case law of the Court of Justice of the European Union, which lays down the adoption of measures for the creation and functioning of the internal market, allowing a Member State

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to adopt national provisions after the adoption of a harmonization measure to avoid quantitative restrictions between Member States, without prejudice to restrictions due to reasons of public morality, public order, public security, protection of health and life of humans and animals or plant preservation, protection of national artistic, historical or archaeological heritage, or protection of industrial and commercial property, provided they do not constitute a means of arbitrary discrimination or a disguised restriction on the matter between the Member States. The same article allows a Member State to introduce national provisions following the adoption of a harmonization measure only upon approval by the European Commission and based on scientific evidence; the same article establishes in paragraph 2 an exemption as regards tax provisions, provisions concerning the free movement of persons and relating to the rights and interests of employees.

With the regulation, the new rules on transparency are established with the obligation to provide for the reporting of information regarding the SFTs agreed by all market participants, whether they are financial or non-financial entities, including the composition of collateral, if the collateral the replacement of collateral at the end of the day and the warranty haircuts applied are available for re-use or re-use. In order to minimize the additional operational costs of market participants, the new rules and provisions should be based on the infrastructures, operating procedures and pre-existing formats that have been introduced regarding the reporting of derivative contracts to trade repositories. In this context, the European Supervisory Authority (European Securities and Markets Authority, ESMA) established by Regulation (EU) no. 1095/2010 of the European Parliament and of the Council should, to the extent feasible and relevant, minimize overlaps and avoid inconsistencies between the technical standards adopted under this Regulation and those adopted pursuant to Article 9 of Regulation (EU) n.

648/2012 concerning the reporting obligations relating to derivative contracts.

The legal framework set out in this SFT Regulation should, to the extent possible, be the same as that introduced by Regulation (EU) no. 648/2012 in relation to the reporting of derivative contracts to trade repositories registered for this purpose. In this way, trade repositories registered or recognized in accordance with this regulation (Articles 55 and 99 of Regulation 648/2012) could fulfill the repertoire function provided for in this Regulation if they meet certain additional criteria, without prejudice to the completion of a procedure of simplified registration. The new rules on the transparency of SFTs and total return swaps are closely linked to Directives 2009/65/EC and 2011/61/EU (which we will deal with in the next paragraph) of the European Parliament and the Council, as directives they constitute the legal framework governing

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the creation, management and marketing of collective investment schemes, bodies that may operate as undertakings for collective investment in transferable securities (UCITS), administered by management or investment companies of UCITS authorized to the provisions of Directive 2009/65/EC, or in alternative investment funds (AIFs, alternative investment funds) administered by alternative investment fund managers (AIFMs) authorized or registered pursuant to Directive 2011/61/EU. The new rules on the transparency of SFTs and total return swaps introduced by this regulation complement and are applied in addition to the provisions of Directives 2009/65/EC and 2011/61/EU. Regulation (EU) 2015/2365 stipulates that the exchange or transmission of personal data by the competent authorities of the Member States or trade repositories is carried out in accordance with the rules on the transfer of personal data referred to in Directive 95/46/EC of the European Parliament and of the Council, repealed by Regulation (EU) 2016/679 on the protection of individuals with regard to the processing of personal data and on the free movement of such data. It is considered appropriate that the exchange or transmission of personal data by ESMA, EBA or EIOPA also takes place in accordance with the rules on the transfer of personal data pursuant to Regulation (EC) no. 45/2001 on the protection of individuals with regard to the processing of personal data by the Community institutions and bodies (the institutions, bodies, offices and agencies of the Union established by the TEU, the TFEU or the Euratom Treaty or on the basis of these treaties), as well as the free circulation of such data; to be considered that the regulation (EC) number 45/2001 is subsequently abrogated by the regulation (EU) 2018/1725, now in force. Furthermore, since the new uniform rules on the transparency of SFTs and certain OTC derivatives (in particular total return swaps) defined by the regulation, are strictly linked to the standards of reporting obligations defined by Regulation (EU) no. 648/2012, since OTC derivatives fall within the scope of the same reporting obligations, with Article 32 of Regulation (EU) 2015/2365 some amendments are made to Regulation (EU) 648/2012 to ensure an area of consistent application of both sets of transparency and reporting obligations. In particular, a clear distinction is drawn between OTC derivatives and exchange traded derivatives, regardless of whether these contracts are traded on the Union or third country markets.

Article 32 modifies item 7 of Article 2 of Regulation (EU) 648/2012 defining "OTC derivative" or "OTC derivative contract": a derivative contract whose execution does not take place on a regulated market pursuant to Article 4 (1) (14) of Directive 2004/39/EC or on a market in a third country considered to be equivalent to a regulated market pursuant to Article 2a of this Regulation;

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furthermore, it introduces article 2 bis, which establishes equivalence provisions for the purposes of defining OTC derivatives for a third-country market to a regulated market pursuant to Article 4 of Directive 2004/39/EC and subsequent amendments; therefore the standard is established that allows to identify clearly the markets equivalent to the regulatory markets of third countries in order to be able to trace the clear distinction between derivatives and OTC derivatives.

In Chapter I of Regulation 2015/2365/EU the object, the scope and the definitions of interest are defined. The regulation, as reiterated above, establishes rules on the transparency of securities financing operations (SFT) and reuse; applies to counterparties in an SFT established in the Union, including all its branches, irrespective of where they are located and in a third country, if the SFT is completed in the performance of the activities of a branch in the Union of such counterpart. To management companies of undertakings for collective investment in transferable securities (UCITS) and investment companies UCITS pursuant to Directive 2009/65/EC, the managers of alternative investment funds (AIFMs) authorized pursuant to Directive 2011/61/EU, the counterparty engaged in re-use established in the Union, including all its branches, irrespective of where they are located; it also applies to counterparties engaged in re-use in a third country, if the re-use is carried out in the performance of a branch of that counterparty in the Union, or the re-use relates to financial instruments provided under a collateral security contract by a counterparty established in the Union or by a branch in the Union of a counterpart established in a third country. It provides for exemptions from the reporting and safeguarding obligations of the SFTs defined in Article 4 and for the obligations set out in Article 14, transparency of collective investment undertakings in the pre-contractual disclosure, for members of the European system of central banks (ESCB), other institutions of the Member States carrying out similar functions and other public bodies of the Union responsible for managing the public debt or intervening therein; the Bank for International Settlements and for transactions to which a member of the ESCB is a counterparty.

In Chapter II, Article 4 the reporting obligation for trade repositories is defined: SFT counterparties transmit information on the SFT operations they have concluded, as well as their modification or termination, to a trade repository registered in accordance with Article 5 or recognized in accordance with Article 19. This information shall be transmitted no later than the business day following the conclusion, modification or termination of the transaction. The same article defines the possibility of delegation of information relating to SFTs, also establishes that if a financial counterparty

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concludes an SFT with a non-financial counterparty that at the balance sheet date is classified as a business average according to the numerical limits of at least two of the three criteria set out in Article 3 (3) of Directive 2013/34/EU of the European Parliament and of the Council (Balance sheet EUR 20 million, Net income EUR 40 million, average number of employees employed during the financial year: 250), the financial counterparty is responsible for reporting to both counterparties; in the event that the counterparty to securities transfer transactions is a UCITS managed by a management company, the latter is responsible for reporting on behalf of the UCITS, if the counterparty is an alternative investment fund, the fund manager last is responsible for reporting on behalf of the fund. The counterparties keep the data relating to the SFTs they have concluded, modified or ceased for a minimum period of five years after their termination. If a trade repository is not available for the registration of information on SFTs, counterparties shall ensure that this information is reported to ESMA, in this case, the European Supervisory Authority (European Securities and Markets Authority). ESMA shall ensure that all the competent entities referred to in Article 12 (2) have access to all the information concerning the SFTs they need to perform their respective tasks and mandates. Regarding the information received pursuant to Article 4 of the Regulation (reporting and safeguard obligation in respect of SFTs), trade repositories and ESMA respect the relevant provisions on confidentiality, integrity and protection of information and comply with the obligations established in particular in Article 80 of Regulation (EU) No 648/2012 concerning the safeguarding and registration of data directories in which the references to Article 9 and the derivative contracts of the same regulation should be replaced with Article 4 of Regulation 2015/2365/EU and with SFTs, substitution aimed exclusively at same Article 4 for compliance with the obligations set out in Article 80 of Regulation 648/2012. Also with Article 4 of Regulation 2015/2365, the European Commission establishes that for a reporting counterparty information relating to an SFT to a trade repository or to ESMA or an entity reporting such information on behalf of a counterparty not is considered in violation of any restrictions on the disclosure of information imposed by the contract or by other laws, regulations or administrative provisions; the person making the report, its directors and employees are excluded from any liability arising from the report. In order to ensure the consistent application of this article and consistency with the reporting made pursuant to Article 9 of Regulation (EU) no. 648/2012 and internationally agreed standards, ESMA, in close cooperation with the ESCB and taking into account its needs, shall develop draft regulatory technical standards to clarify reporting information for the different types of SFTs, which include at least:

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a) the parties to the SFT and, if different, the beneficiary of the rights and obligations arising therefrom; b) the amount of the capital; the currency; the assets used as collateral and their type, quality and value; the method used to provide collateral; if the collateral is available for re-use; in the event that the collateral is distinguishable from other assets, if they have been re-used; possible substitutions of collateral; the repurchase price; the loan commission or the margin loan rate; any warranty discrepancies; the value date; the expiry date; the date of the first recall and the market segment; c) depending on the SFTs, information concerning: i) the reinvestment of collateral consisting of cash and cash equivalents; (ii) securities or goods granted or borrowed.

In developing these draft technical standards, ESMA shall take into account the technical specificities of the asset aggregates and, where appropriate, provides for the possibility of reporting the collateral data at the position level.

ESMA, in close cooperation with the ESCB and taking its needs into account, has developed draft implementing technical standards specifying the format and frequency of alerts for the different types of SFTs, in particular the format includes: the global identifiers of legal entities (LEI code) or pre-LEI codes, until the global system of identification of legal entities is fully implemented (3°); b) the international identification numbers of the securities (ISIN code); and c) the unique identifiers of the transactions. In developing these draft technical standards, ESMA took into account international developments and agreed rules at Union or global level.

(3°) NOTE: the identifier of the legal entity (LEI) is an alphanumeric code, consisting of 20 characters, which is based on the ISO 17442 standard defined by the International Organization for Standardization (ISO), it is associated with key reference information that makes it possible to unambiguously identify the legal entities involved in an economic transaction and contains information on the ownership structure of the legal person. A global archive of searchable LEI codes that increases transparency in the global market. The Financial Stability Board (FSB) deems it necessary to globally adopt the LEI code because it enables better risk management by encouraging greater quality and accuracy of financial data as a whole. The set of data associated with publicly available LEI codes provides access to standardized information on legal entities worldwide. Data are recorded and verified regularly in accordance with protocols and procedures defined by the regulatory supervision committee of the LEI codes. In collaboration with its

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partners in the Global LEI System, the Global Legal Entity Identifier Foundation (GLEIF) continues to strive to further optimize the quality, reliability and usability of data associated with the LEI codes, making it available to market participants. numerous information associated with the population of LEI codes. The promoters of this initiative, namely the Wind Group, the FSB and many regulatory authorities around the world, have emphasized the need to make the LEI code a widespread public good. The Global Index of LEI codes, a tool made available by GLEIF, contributes greatly to achieving this goal. This index makes available to all interested parties, in a practical and free way, all the data associated with the LEI codes.

Currently the LEI code is required by companies through GLEIF or its business partner. a Global Legal Entity Identifier Foundation (GLEIF) publishes the 'Entity Legal Forms List (ELF)' ('Entity Legal Form (ELF) Code List'). The first iteration, published in November 2017, lists more. of 1,600 legal forms in over 50 jurisdictions. Among the legal forms include, for example: Limited liability partnership (LLP), Gesellschaft mit beschrankter Haftung (GmbH) and SociĂŠtĂŠ Anonyme (SA). The ELF Code List assigns a unique code to each legal form, an alphanumeric code consisting of four characters of the basic Latin character set, the interaction in the standardized set of reference data on a legal entity available in the Global Index of LEI codes further improves 'business card' information included in every register related to a Legal Person ID (LEI). Data enrichment improves the user experience because favors the classification of legal entities and therefore offers more information on the global market. The ELF Code List is based on ISO 20275 'Financial Services - Entity Legal Forms (ELF)', developed by the International Standards Organization and published in July 2017; specifies the elements of a unique system to identify the different legal forms existing in a jurisdiction. It is proposed to codify the existing legal forms in the jurisdictions and thus facilitate the classification of legal entities according to their legal form "where the legal rule means the" type of legal entity in which an organization is classified within the system legal or regulatory framework ", clear knowledge that constitutes an important element of transactions in the financial services sector, in fact, in order to start a business relationship, it is necessary to distinguish the type of legal entity with which the transaction is carried out. (and their organizational structure) involved in financial transactions must be identified within such transactions.The standardization of information on legal or organizational structures will offer greater flexibility and allow better understanding of risk exposure and access to capital " .

"Regulatory authorities and market participants have recognized the need to identify legal forms, both nationally and that consistently on global markets, and have called for the development of a standard that can meet this need.

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20275 satisfies the need to identify legal forms in a structured way in order also to classify legal entities based on the nature of their legal structure ". The ISO has set up an updating authority for ISO 20275 made up of ISO members and members of the ISO 68 Financial Services Technical Committee. The Swiss Association for Standardization (SNV) was appointed to the Secretariat of the Update Authority. The SNV has assigned "the execution of the updating authority's secretariat activities" and the execution of the related tasks to the GLEIF. In addition to the other functions performed, the GLEIF is responsible for identifying the existing legal forms and assigning a unique ELF code to each legal form under ISO 20275. In conclusion, it is expected that the issuing organizations of LEI codes will report the ELF code in their processes of issuing the LEIs and in their communications. The LEI Common Data File (CDF) format defines the ways in which the organizations issuing LEI codes must communicate their LEI and first level reference data, ie business card type information about a legal entity and from 1° March 2018, all newly issued LEIs must carry the ELF code of the legal entity. Source: GLEIF.

In Chapter III of Article 5 of Article 12, provisions are laid down on the registration and supervision of trade repositories, with reference to the obligations set out in Chapter II through Article 4, the obligation to register data at the ESMA with related procedure it is defined. In Chapter IV of the regulation, transparency obligations with investors are defined by defining with the article 13 the information for investors, the obligation of the UCITS management companies, the same UCITS and AIFM companies to inform investors on the use that these they make SFTs and total return swaps; annex A of the regulation defines the information on the SFTs and the total return swaps to be provided in the semiannual and annual reports of the UCITS and in the annual report of the AIF in addition to the information contained in the semi-annual and annual reports provided for in Article 68 of the Directive 2009/65/EC for UCITS and Article 22 of Directive 2011/61/EU for AIFMs. Article 14 of the same chapter establishes the information obligations for pre-contractual investors by defining in Annex B information on SFTs and total return swaps that UCITS management companies or UCITS investment companies and AIFMs are respectively authorized to use, and include a clear declaration that these operations and tools are used; the information is added to the contents of the prospectus to investors enshrined in Article 69 of Directive 2009/65/EC for UCITS and with Article 23, paragraphs 1 and 3, of Directive 2011/61/EU for AIFMs.

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In Chapter V of regulation 2015/2365/EU, transparency of re-use, article 15, are defined the conditions for the right of the counterparty to re-use financial instruments received under a guarantee contract subject to the following conditions: a) the supplying counterparty has been duly informed in writing by the receiving counterpart of the risks and consequences inherent in: i) the consent to a right to use a guarantee provided under a guarantee contract with a real guarantee in accordance with Article 5 of Directive 2002/47/EC on financial guarantee contracts (4°); or ii) to the conclusion of a guarantee contract with transfer of the title of ownership; b) the supplying counterparty has given express consent, evidenced by a signature, in writing or in a legally equivalent form, of the same supplying counterparty a warranty contract with a real guarantee, the terms of which recognize a right of use in accordance with Article 5 of Directive 2002/47/EC (4°), or expressly agreed to provide collateral by means of a guarantee contract with transfer of the title of property. With regard to letter a) of the first subparagraph, the supplying counterparty is informed in writing at least of the risks and consequences that may arise in the event of default of the receiving counterparty.

(4°) NOTE: Article 5 of Directive 2002/47/EC establishes the right to use the financial guarantee in financial collateral agreements by defining the obligation to replace with collateral security from part of the beneficiary when using the financial guarantee, assuming the obligation to transfer an equivalent guarantee to replace the original financial guarantee, at the latest on the due date for the fulfillment of the covered financial obligations, contemplated by the financial guarantee contract with real guarantee constitution; alternatively, the beneficiary of the guarantee, on the date set for the performance of the financial obligations guaranteed, transfers the equivalent guarantee or, if and to the extent that the terms of the financial collateral arrangement with an effective collateral provide for it, compensates the equivalent guarantee with the guaranteed financial obligation or uses it to settle the guaranteed financial obligation. The equivalent collateral transferred is subject to the financial guarantee contract with a real collateral to which the original financial guarantee was subject and is deemed to be provided under the financial guarantee contract with a real guarantee in the moment in which the original financial guarantee is been provided for the first time. Member States must ensure that the use of the financial guarantee by the beneficiary does not render invalid o not subject to forced execution the rights of the collateral beneficiary under the contract as regards the financial guarantee transferred by the collateral taker. Furthermore, if an event that determines the enforcement of the guarantee occurs while the obligation to transfer the

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collateral from the beneficiary of the financial guarantee has yet to be fulfilled, this obligation may be subject to close-out compensation.

Also in Article 15 of Regulation 2015/2365/EU it is established that any exercise by the counterparties of the right to reuse is subject to both of the following conditions: a) re-use is carried out in accordance with the terms specified in the warranty contract so it must be preceded and proven by a signature, in writing or in a legally equivalent form of the supplying counterparty, the terms of which recognize a right to use the financial instruments received in accordance with Article 5 of Directive 2002/47/EC, or have expressly agreed to provide collateral securities by means of a guarantee contract with transfer of the title of ownership, b) the financial instruments received under a guarantee contract are transferred from the account of the supplying counterparty. Notwithstanding condition (b), where the counterparty to a guarantee contract is established in a third country and the counterparty's account providing the collateral is kept in a third country and subject to the latter's legislation, re-use is demonstrated by a transfer from the account of the supplying counterpart or other appropriate means.

Article 15 of the Regulation is without prejudice to the most stringent sectoral legislation, in particular Directives 2009/65/EC and 2014/65/EU, as well as national legislation designed to ensure a higher level of protection for the supplying counterparts and does not affect national legislation regarding the validity or the effect of an operation. Regulation (EU) 2015-2536 under Chapter VI lays down supervisory provisions and competent authorities, in Chapter VII defines the conditions for equivalence between STF trading repositories between Member States and third country countries in order to establish rules that allow recognition and equivalence; in chapter VIII defines the administrative measures and sanctions that the authorities of the member states must impose at least for violations of articles from 4 to 15 of the same regulation.

On 14 October 2014, the FSB published a regulatory framework for the haircuts applicable to non-centrally cleared SFTs (through a central counterparty authorized pursuant to Regulation (EU) No. 648/2012); being the SFT, in the absence of compensation and adequate guarantees, operations exposed to serious risks, the FSB has defined a regulatory framework for the double track collateral scraps: 1) qualitative rules for the methods applied by market participants to calculate royal guarantee haircuts 2) minimum numerical levels of the guarantee differences for non-centrally cleared SFTs in which the financing against collateral other than sovereign

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debt instruments is granted to non-bank subjects, according to the following table:

2.2 - Credit default swaps: EU regulation 236/2012 The credit default swap (CDS) is a swap with the function of transferring credit risk, the most common between credit derivatives classified as a hedging instrument. An investor (A) has a credit (for example due to a loan) against a debtor counterpart (B). Investor A to protect himself from the risk of bankruptcy of counterpart B with the credit that loses its value or becomes uncollectible is aimed at a third party C, willing to take on this risk; the counterpart C acts in a manner similar to an insurance, in the technical jargon defined as protection seller, or "protection seller". Part A with commitment pays to C a periodic amount, the amount of which is the "price" of the hedge and is the main object of the contractual agreement; in exchange for this cash flow, the protection seller (C) undertakes to repay to part A the nominal value of the credit instrument, in the event that the debtor B becomes insolvent (an event called credit default). The contractual agreement between A and C on the underlying security B is called a credit default swap (CDS). In the financial world, CDS were born and spread as hedging instruments, allowing the

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exchange of protection on the market as in the case of currencies or raw materials. Normally the duration of a CDS is five years, duration that can change being a non-standardized contract (there are many variations) and it is traded on the over-the-counter market (not regulated), where it is possible to stipulate any duration. Credit default swaps are also used to hedge against a bankruptcy risk (or rating downgrade) of a state. In this case they are called "CDS sovrani" (sovereign CDS). Credit default swaps intervene, for example, in short-term securities.

The sale of securities not directly held by the seller, carried out against one or more third parties not directly, is called short selling, seller naked; it is a sales technique that is not recommended for long-term investments. Securities, usually provided by a bank or financial intermediary, are instantly lent by their supplier to the short seller (also referred to as a shortlisted seller or seller) and then immediately sold by the latter. Therefore, short selling is a nonmoney loan, but a bond and, as is usually the case with money, there is an interest to be paid to the lender. The amount of interest to be paid increases in relation to the increase in the duration of this bond loan, since the person who sells it naked must, within a certain period of time, buy the securities on the market (therefore at market price) with refund to the lender: technically defined operation covering the overdraft (in English short covering). For the buyer there is no difference between the securities purchased from a short sale or not in the open because the short selling implemented by the seller is practically invisible. The income generated by the sale of the securities comes before the moment of the actual purchase by the seller (in the first phase of sale to the buyer the sellers lent the securities), the short sale is made when the short seller (because takes the securities on loan) provides that the cost of their subsequent acquisition on the market (the one intended to cover the overdraft, ie to repay the lender) will be lower than the price previously collected (and usually this equivalent value is provisionally placed as collateral on the short up to overcoating performed). In this case, the overall yield of the short selling operation will be profitable. Conversely, if the price of the securities increases during the time of the loan, the return on the transaction will result in loss. Therefore, short selling occurs mainly when the stock markets are in a downturn, a phase that historically has a shorter duration and are less numerous than the ascending phases, which is the reason for the short name.

At the height of the financial crisis in September 2008, the competent authorities of several Member States and the supervisory authorities of third countries such as the United States of America and Japan have taken emergency measures to restrict or prohibit short selling of some or of all

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categories of securities. These authorities intervened, fearing that, at a time of considerable financial instability, short selling could have aggravated the downward spiral of stock prices, in particular of financial institutions, to such an extent that they ultimately threatened financial solidity and create systemic risks. Events that have created little harmonization between the measures adopted by the Member States precisely because of the lack of a specific common legal framework for short selling.

With the adoption of regulation (EU) 236/2012 the European Commission guarantees the proper functioning of the internal market and improves the conditions of its operation, with particular regard to financial markets, guarantees a high level of protection for investors and consumers; with this regulation, the commission establishes a common regulatory framework regarding the rules and powers relating to short selling and derivative contracts concerning the coverage of the risk of default of the issuer (credit default swap). The regulatory framework ensures a greater degree of coordination and consistency between Member States in which measures must be taken in exceptional circumstances, harmonises the rules on short selling and some relevant aspects of credit default swaps, prevents the creation of obstacles to good functioning of the internal market because it prevents the Member States from continuing to adopt divergent measures. A regulatory legislative framework is adopted (Regulation 236/2012/EU) to ensure that provisions directly providing for the obligation to notify individuals and therefore public disclosure of their relative net short positions certain instruments and related to short selling made in the absence of the availability of securities for investment firms or banks, rules to be applied uniformly throughout the Union. The regulation is also needed to confer on the European Supervisory Authority (European Securities and Markets Authority) (ESMA), established by Regulation (EU) no. 1095/2010 of the European Parliament and of the Council, the powers to coordinate the measures taken by the competent authorities or to adopt the measures itself.

The regulatory framework adopted with Regulation (EU) 236/2012 extends to all financial instruments in exceptional cases and establishes permanent rules proportionate to the risk that short sales generate. It establishes that the competent Asfem authorities may adopt measures relating to all financial instruments in exceptional circumstances beyond permanent measures that only apply to particular types of financial instruments. Requirements are defined for notifying regulatory authorities of significant net short positions relating to sovereign debt securities in the Union, which allow the same authorities to verify whether such positions create systemic risks or are used for improper purposes; such communications must remain private to the

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authorities to avoid negative effects on the sovereign debt markets where liquidity problems exist. The reporting obligations relating to sovereign debt are applied to debt instruments issued by a Member State and the Union, including the European Investment Bank, a Ministry of a Member State, an Agency, a special purpose vehicle or an international financial institution created by two or more Member States issuing debt on behalf of one or more Member States, such as the European Financial Stability Fund or the future European Stability Mechanism. In the case of federal Member States, notification obligations should also relate to debt instruments issued by a member of the federation. They do not concern other regional, local or semipublic bodies of a Member State, which issue debt instruments. The objective of debt instruments issued by the Union is, in particular, to provide balance of payments support or financial stability for Member States or for macrofinancial assistance to third countries. The regulation establishes notification obligations concerning not only short positions created by trading stocks or sovereign debt in trading venues (regulated markets), but also short positions created by trading outside these locations and the net short positions created with the use of derivative products, such as option contracts, standardized futures financial contracts (futures), index-linked instruments, differential financial contracts and spread bets relating to equity securities or sovereign debt. They require complete and accurate information on the positions of a natural or legal person. In particular, information provided to regulators or the market takes into account both short and long positions in order to provide valid information about the net short position in equity securities, sovereign debt and credit default swaps of the natural or legal person.

The transparency rules established by the committee provide for notification or communication to the public, when a change in a net short position involves a variation, and are applied regardless of where the natural or legal person has its headquarters, even in a third country, where such person has an important net short position in a company whose shares are admitted to trading on a trading venue in the Union or a net short position in sovereign debt issued by a Member State or the Union. The definition of short selling does not include either a repurchase agreement between two parties, in which one party sells to the other a security at a price determined with the commitment to repurchase it at a later date than another determined price, or a derivative contract where the sale of securities is agreed at a price set at a future date and does not include the transfer of securities on the basis of a securities lending arrangement. The short sales of equity or sovereign debt securities made in the absence of the availability of the securities are considered in the regulation to increase the risk of non-settlement and market

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volatility; to reduce these risks, restrictions are imposed proportionate to the short selling of these instruments. For the short sale of titles equity in the absence of securities, it is necessary that a natural or legal person has concluded an agreement with a third party pursuant to which the latter has confirmed that the share has been localized, which means that the third confirms that he believes he can have the title available for settlement at the scheduled deadline. For the purpose of this confirmation it is necessary that measures be taken against third parties so that the natural or legal person has the reasonable expectation that the regulation can be carried out at the scheduled expiry. This includes measures such as the assignment by the third party of equity securities for the loan or purchase so that settlement can take place at the scheduled deadline. For short sales to be covered by the purchase of the security on the same day, this includes the confirmation by the third party of considering the security readily obtainable for the loan or purchase. In determining what measures are necessary to have a reasonable expectation that settlement will take place on the due date, AESFEM will take into account the liquidity of equity securities, in particular the level of trade and the ease with which the purchase, sale and loan can be made with minimal impact on the market.

The obligations of central counterparties are defined in relation to enforcement procedures compulsory(buy-ins) and penalties for failure to settle transactions in equity securities. Additional rules are set for measures related to sovereign debt and sovereign credit default swaps, including measures for greater transparency and restrictions on short selling in the absence of the availability of securities that establish proportionate obligations and at the same time avoid a negative impact on the liquidity of sovereign bond markets and sovereign debt repurchase markets. Intervention powers are envisaged for the authorities to demand greater transparency and to impose time restrictions on short selling, credit default swaps or other transactions in order to prevent an uncontrolled reduction in the price of a financial instrument in case of development unfavorable conditions that seriously threaten the stability or confidence of the market in a Member State; measures that may be necessary as a result of various unfavorable events or developments, financial or economic events, natural disasters or terrorist acts. Furthermore, some unfavorable events or developments requiring the adoption of measures could occur only in one Member State and have no cross-border implications. Chapter I of the regulation defines the scope of application, the definitions aimed at settlement, the short and long positions and the position uncovered in a credit default swap on sovereign issuers. In Chapter II the rules on the transparency of net short positions are

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established, in Chapter III the rules for short selling are defined in absence of the availability of securities, in Chapter IV the conditions derogation from the regulation, in Chapter V are defined the powers intervention of the competent authorities and of Aesfem, and the role of authorities in Chapter VI.

the for the the

Therefore, Regulation (EU) 236/2012 on the short selling and certain aspects of derivative contracts to cover the risk of default of the issuer (credit default swap) is amended by Regulation (EU) 909/2014 on which deletes the relevant Article 15 relating to the compulsory buy-in enforcement procedure.

3 - UNDERTAKINGS FOR COLLECTIVE TRANSFERABLE SECURITIES

INVESTMENT

IN

THE

3.1 Introduction Securities lending is a very common practice in the UCITS fund industry (Undertakings for Collective Investment in Transferable Securities): investments in mutual funds and SICAV regulated by the European Parliament Directive 2009/65/EC, published on January 13, 2009, called Ucits. The directive makes new changes to previous European Parliament Directives, previous Ucits and published on 21st January 2002 (2001/107/EC, Directive manager and 2001/108/EC, Product Directive) and which in turn had constituted an important update of the Directive 85/611/EEC (first Ucits directive), identifies those collective investment schemes, mutual funds and Sicavs, which invest mainly in transferable securities in accordance with the provisions of the regulatory text; in essence, the UCITS directives specifically regulate UCITS as collective investment schemes that invest in transferable securities, including mutual funds and SICAVs (investment companies with variable capital). The investment companies with variable capital SICAV are treated as a unit trust, with the difference that in the investment fund the investor owns a portion of the fund itself, administered by a separate management company (the SGR) , while in the SICAV the investor assumes the status of shareholder of the guarantor company, whose share capital coincides with the assets under administration. The first Ucits directive

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allowed UCITS authorized by a Member State to be freely distributable in other EU Member States (European passport) promoting greater harmonization of markets. Being the criticality of the first UCITS directive, little attention to the discipline of the UCITS management companies (UCITS) and the depositaries of assets subject to investment and the emergence of new types of UCITS, which did not fall within the scope of the First Directive and which therefore did not enjoy the advantages it offered at the beginning of the 1990s, a second UCITS directive proposal was developed to resolve these issues; the long political disputes between the European countries meant that it was soon abandoned. With the approval of the subsequent Ucits, the third (Directive 2001/107 / EC, directive manager and directive 2001/108 / EC, product directive) the European passport was extended to a much larger number of UCITS, which form that moment fall into in the new definition of harmonized product. The marketing of units or shares of Ucits-compliant funds was also permitted in non-EU countries such as: Switzerland, Asia, South America and South Africa. The fourth Ucits Directive (Directive 2009/65/EC) has laid the foundations for a profound transformation of the European market for collective asset management, further innovating the regulations on the passport of the operator, freedom of establishment and freedom to provide services and creating the conditions for achieving greater economies of scale within the sector. On July 23, 2014, the 2014/91/EU Directive (fifth UCITS) was adopted, which intervenes on the previous UCITS directive to eliminate the disparities between the national rules on the functions and responsibilities of depositaries, with regard to the remuneration policy of managers, on administrative sanctions and with the objectives of increasing investor protection and prevention of systemic financial risks and conforming to the new provisions introduced by the Alternative Investment Fund Managers Directive (AIFMD) which establishes harmonized regulatory standards for AIFM (alternative investment fund managers). Normally, alternative funds differ from other mutual funds because they have the possibility of investing in a wider range of instruments. They belong to them to non-harmonized collective investment funds unlike the UCITS; known as FIA and not regulated at European level, unlike the AIFMs (FIA management companies) as illustrated in paragraph 5, precisely because they consist of highly diversified financial instruments among the member countries, a dynamic that causes impediment to harmonized regulation while remaining subject to the different legislations existing in the individual member countries of the European Union. Prior to the adoption of the Fifth UCITS Directive (EU) 2014/91, the European Commission further reviewed the UCITS regulations by publishing, on July 26, 2012, a new UCITS consultation document entitled "Product Rules, Liquidity Management, Depositary, Money Market Funds,

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Long Term Investments ". This initiative lays the foundations for a new legislative process aimed at improving the regulatory framework for UCITS, and thus for the definition of a new UCITS, the sixth.

3.2 - Collective investment company: UCITS guidelines (UCITS) Directive 2009/65/EC is issued by the European Commission on July 13, 2009, considering that the Directive 85/611/EEC of the Council of 20 December 1985 on the coordination of laws, regulations and administrative provisions relating to certain undertakings for collective investment in transferable securities (UCITS), has been substantially amended several times. With the new modifications, a grouping of previous modifications is carried out in the single directive 2009/65/EC. With Directive 85/611/EEC, an important contribution was made to the development of the financial investment sector. "Many improvements have been made that at the turn of the 21st century were inadequate for UCITS for the new millennium financial markets". The Commission Green Paper of 12 July 2005 on strengthening the regulatory framework for investment funds in the EU launched a public debate on how Directive 85/611/EEC should be amended to address those new challenges. This intensive consultation process led to the broadly agreed conclusion that substantial changes to this directive are necessary. The Commission considers that coordination of national laws governing collective investment undertakings should be coordinated to bring the conditions of competition between these bodies closer together at Community level, while at the same time ensuring more effective and more uniform protection for unitholders. Such coordination facilitates the removal of restrictions on the free movement of UCITS units in the EU Community. With regard to the above objectives, the Commission considers it important to lay down common minimum standards with regard to the authorization, supervision, structure and activity of UCITS established in the Member States, as well as the information they are required to publish. It should be noted that the units of UCITS are considered financial instruments in accordance with Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments. The activity of individual management of investment portfolios is an investment service governed by Directive 2004/39/EC subsequently recast with the Directive (EU) 2014/65 studied in the next paragraph and therefore to ensure that the sector is governed by a homogeneous regulatory framework, management companies which are

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authorized to provide such a service must also be subject to the conditions laid down in that Directive.

The Commission considers that, as a general approach, a Member State of origin should be able to enact stricter rules than those set out in this Directive where it is deemed necessary, with particular reference to the subject of authorization conditions, prudential requirements and requirements in the subject of reports and prospectuses relating to the specific activity, the business object of the collective investment undertakings.

With the directive 2009/65/CE are established the rules that define the preconditions to which a management company (collective portfolio management: management of mutual funds or management of investment companies) can delegate to third parties, on the basis of a mandate, tasks and specific functions for the purpose of increasing the efficiency of their activities. Since the application of the supervisory principle by the home Member State must be ensured, the Member States allowing such a delegation have the task of ensuring that the management companies authorized by them do not delegate all their functions to one or more third parties, so as to become a phantom company, and that the existence of mandates does not prevent an effective supervision of the management company. A management company which has delegated its functions should not prejudice the liability of the company and the depositary vis-Ă -vis the holders of the units and the competent authorities. With the aim of ensuring a level playing field and adequate supervision over the long term, it is established that the Commission examines the possibility of harmonizing the arrangements for delegation at Community level. As we will see in the next paragraph the companies of investment defined in Directive (EU) 2014/65 are authorized to carry out the predominant activity of providing services and / or investment activities on an individual professional basis, including the raising of funds from the public for investment activities and the provision of investment such as the execution of purchase orders for securities, shares, unlike the management companies of collective investment schemes whose business objective is the management of mutual funds or the management of groups of investment companies UCITS. For UCITS, Directive 2009/65/EC intends the following bodies: a) whose sole object is the collective investment of capital raised from the public in transferable securities or other liquid financial assets referred to in Article 50 (1), and whose functioning is subject to the principle of risk spreading; and b) whose units are, at the request of the holders, repurchased or redeemed, either directly or indirectly, from the assets of the aforementioned bodies.Is assimilated to such repurchases or reimbursements the fact that a UCITS acts to prevent the value of its market

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shares from moving away significantly from the net asset value. In accordance with national law, UCITS can take the form of a contract (a mutual fund managed by a management company) or a trust (unit trust: a trust deed) or a statutory form (an investment company); in the first case, the management company must be designated, so the same management company can set up a UCITS in a contractual form; for the second case, as we will see in this paragraph, derogation provisions are laid down for the management company's obligation. The investment company may invest the funds raised by the public in collective investment portfolios if authorized with reference to the legal logic defined by Directive 2009/65/EC; therefore, the UCITS investment company within the meaning of this Directive is not subject to the provisions of Directive (EU) 2014/65 for investment companies that provide services on an individual and non-collective level such as investment institutions. Investment companies whose assets are invested, through the intermediation of subsidiaries, mainly in assets other than transferable securities are not subject to this Directive; it is prohibited for UCITS subject to this Directive to be transformed into undertakings for collective investment not subject to this Directive, moreover, a Member State may apply to the UCITS established on its territory additional or stricter provisions, provided these are of general application and are not contrary to Directive 2009/65 / EC. a derogation from this Directive is made for: a) closed-ended undertakings for collective investment; b) collective investment undertakings that raise capital without promoting the sale of their shares among the public within the Community or in any part of it; c) collective investment undertakings whose sale of units is reserved by the fund regulations or by the memorandum of association of the investment company to the public in third countries; (d) the categories of collective investment undertakings established by the legislation of the Member State in which those collective investment undertakings are established, for which the obligations relating to the UCITS investment policy set out in the rules of Chapter VII can not be applied; the general obligations of a UCITS defined by the rules of Article 83, in view of their investment and borrowing policy. Member States may allow a UCITS to consist of several investment compartments and if they comprise more than one sub-fund, for the purposes of the provisions on investment policy obligations, Chapter VII of the Directive (Articles 49 to 57), is adopted the criterion by which each investment sub-fund is considered to be a separate UCITS. Directive 2009/65/EC establishes an obligation for the authorities of the Member State to refuse or revoke the authorization to a management company if the content of the activity program, geographical distribution or activities actually carried out clearly indicate that it has chosen the legal

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system of a Member State in order to avoid the stricter criteria in force in another Member State on whose territory it intends to carry out or perform most of its activities. It establishes that a management company should be authorized in the Member State in which its registered office is located. In accordance with the supervisory principle of the home Member State, only the competent authorities of the management company's home Member State should be considered competent to supervise the management company's organization, which should also be subject to the law of the Member State of origin all the procedures and resources necessary for the performance of the administration functions for the collective portfolio management activity (in Annex II of the Directive): Investment management, Administration of investments, activities subdivided into a) legal services and accounting for the management of the fund, b) information service for customers, c) evaluation and determination of the price (also for the purposes of tax returns), d) monitoring of compliance with applicable legislation, e) keeping the register of holders of shares, f) distribution of income, g) issue and redemption of units, h ) settlement of contracts (including sending of certificates), i) keeping of accounting records; in the end of marketing. The Directive stipulates that no management company performs activities other than the management of UCITS authorized pursuant to the same, unless it concerns the additional management of other collective investment undertakings not subject to this Directive and on which the management company it is subject to prudential supervision, but the shares of which can not be traded in other Member States by virtue of it; Derogations from Member States are possible as these may authorize management companies to provide, in addition to UCITS management services, additional services such as management services, on a discretionary and individual basis, of investment portfolios, including those held by pension funds, according to mandates given by investors if these portfolios include one or more of the instruments listed in section C of Annex I of Directive 2014/65/EU; or also, as ancillary services: investment advice in one or more of the instruments listed in Section C of Annex I of Directive 2014/65/EU, custody and administration of units of collective investment schemes (FIA, ad example). Management companies are not under any circumstances authorized under Directive 2009/65/EC to provide only additional services or ancillary services without being authorized to perform UCITS management services; the provision of additional services and accessories nevertheless provides for the application of Article 2 (2) and Articles 15, 16 and Articles 24 and 25 of Directive 2014/65/EU as amended by Directive 2014/91/EU.

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The directive lays down the obligation for investment institutions to have initial capital to safeguard the interests of shareholders and to guarantee a level playing field in the market for the same harmonized collective investment undertakings. Furthermore, it imposes constraints on certain investment transactions linked to the own assets defining limits in percentages of the same patrimony with the provisions of chapter VII, (articles from 49 to 57).

The Directive 2009/65/EC in article 22 establishes that the assets of the mutual fund are entrusted to the custody of a depositary; with the same article it is established that the depositary is responsible, according to the national law of the UCITS home Member State, against the management company and the unit holders, for any damage suffered by them as a consequence of the gross negligence or incorrect fulfillment of his obligations. With regard to the unitholders, the responsibility can be direct or indirect through the management company, depending on the legal nature of the relationship between the depositary, the management company and the unitholders, moreover, the responsibility of the depositary is not affected by the 'entrusting a third party with all or a portion of the values held in custody. The duties of the depositary include the ascertainment that the sale, issue, repurchase, redemption or cancellation of the units on behalf of the fund or the management company are carried out in accordance with the applicable national law and the fund regulations; ascertains that the value of the units is calculated in accordance with the applicable national law and the fund regulations, also executes the instructions of the management company, unless they are contrary to the applicable national law or fund regulations and ascertains that in transactions relating to the countervalue is remitted to it in terms of use, in addition to ascertaining that the returns of the fund receive the destination in accordance with the applicable national law and the fund regulations. The depositary has its registered office or is established in the UCITS home Member State and is an institution subject to prudential regulation and continuous supervision. It provides sufficient financial and professional guarantees to be able to effectively carry out its depositary activity and to meet the commitments resulting from the exercise of this function. Member States shall establish the categories of institutions that can be chosen as depositaries, an institution which allows the competent authorities of the UCITS home Member State to obtain, upon request, all the information which the depositary has obtained in the performance of its tasks and which they are necessary for the competent authorities to monitor compliance by the UCITS with this Directive. If the management company's home Member State is not the UCITS home Member State, the depositary shall enter into a written agreement with the management company which regulates the flow of information deemed necessary in order to enable it to

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carry out the functions above and to the other laws, regulations or administrative provisions which are relevant to the depositaries of the UCITS home Member State. The Commission may adopt implementing measures concerning the measures to be taken by the depositary in order to fulfill its obligations regarding a UCITS managed by a management company established in another Member State, including specific information to be included in the standard agreement in use by the depositary and the management company pursuant to the paragraph. These measures, designed to amend non-essential elements of Directive 2009/65/EC by supplementing it, shall be adopted in accordance with the regulatory procedure laid down in Decision 1999/468/EC subsequently repealed by Regulation (EU) No 182/2011 laying down the general rules and principles concerning the methods of control by the Member States in the exercise of implementing powers conferred on the Commission. With the directive 2009/65/CE it is established that the functions of management company and depositary can not be exercised by the same company, moreover in the exercise of the respective functions the management company and the depositary act independently and exclusively in the interest of unitholders.

The fund's law or regulation must define the conditions for the replacement of the management company and the depositary and provide for the rules to ensure the protection of unit holders in the event of such replacement. The competent authorities of the UCITS home Member State may not authorize a UCITS if the depositary's corporate officers do not meet the requirement of good repute or do not have sufficient experience with the type of UCITS to be managed. To this end, the identity of the depositary's corporate officers, as well as of any person who replaces them in their office, is immediately notified to the competent authorities. Persons who, under the law or the deed of incorporation, represent the depositary or who actually determine the policy of the depositary's activity are considered corporate representatives.

The delegated regulation (EU) 2016/438 of the commission of 17 December 2015 which complements the Directive 2009/65/EC of the European Parliament and of the Council as regards the obligations of depositaries, defines the rules regarding the contract of appointment of the same are established depositary by a management company of a UCITS or investment company (authorized pursuant to Directive 2009/65/EC), defines the functions of the depositary, the defined due diligence duties (due diligence), the separation and protection in the event of the insolvency of the IOCVM. The regulation establishes that at the time of appointment the depositary assesses the risks inherent in the nature, scale and complexity of the investment policy and strategy of the UCITS and in the organization of the

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management company or investment company. On the basis of this assessment, the depositary defines the supervisory procedures appropriate to the UCITS and the assets in which it invests, which are then implemented and applied. Furthermore, the regulation establishes that these procedures should be updated on a regular basis. Among the rules defined by the regulation are the obligations of independence, in particular Article 21 establishes that no one can sit on the administrative body of the management company and at the same time in the administrative body of the depositary; no one may sit on the management body of the management company and be a part of the depositary's personnel at the same time and no one can sit on the depositary's administrative body and be part of the management company's or the investment company's staff at the same time. If the management body of the management company does not exercise the supervisory functions within the company, the body of the company responsible for the surveillance functions may be composed of a maximum of one third of members who are at the same time administrative body, the body in charge of the supervisory functions or the depositary staff; if the management organ of the depositary does not exercise the supervisory functions within the depositary, the body of the depositary responsible for the surveillance functions may be composed of a maximum of one third of members who are also members of the supervisory board administration of the management company or body responsible for overseeing the management company or investment company or the staff of the management company or investment company. With the article 23 of regulation 2016/438 the norms concerning the conflict of interest are defined: the management companies or the investment company and the depositary united by a link or group bond prepare policies and procedures to identify all the conflicts of interest arising from this link, take all reasonable steps to avoid such conflicts of interest.If the conflict of interest is unavoidable, the management company or the investment company and the depositary shall manage it, monitor it and disclose it so as to avoid adverse effects on the interests of the UCITS and its investors. Regulation (EU) 2016/438 is subsequently amended by Regulation (EU) 2018/1619 defining, this last, stricter provisions regarding the custody of financial instruments by depositaries with particular reference to the intensification of controls to be carried out by same that delegate the custody function to third parties and which in turn can further sub-delegate. It lays down provisions with regard to the omnibus accounts with which the delegates can keep the financial instruments, accounts that a depositary active with a delegate to reduce the administrative burden, taking charge only of the management of accounting records for the various clients while the custody of the financial instruments,

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is operated by the delegate collecting the financial instruments of all the customers of the same depositary in an omnibus account for the depositary; defines rules for reconciliation and frequency between the omnibus accounts and the accounting records of the depositaries relating to each UCITS or the related management company, establishes provisions to exclude the activities relating to the ownership of the values held for the delegates who are at responsibility of the depositaries. The amendments made to regulation (EU) 2016/438 are considered mandatory starting from 1° April 2020.

In the first part of this paragraph we have seen that Directive 2009/65/EC establishes the authorization only for the investment fund if the competent authorities of its home Member State have approved the request of the management company to manage this mutual fund , the fund regulation and the choice of depositary, moreover, an investment company is authorized only if the competent authorities of its home Member State have approved its deed of incorporation and the choice of depositary, as well as, where appropriate, the request of the management company to manage such an investment company; for investment companies that make up a UCITS as outlined below, the Directive defines conditions for exemption from the obligation to appoint a management company. The same directive in Chapter III establishes the obligations relating to management companies, obligations that constitute the conditions for access to the business, access subject to prior authorization from the competent authorities of the management company's home Member State. The authorization issued to a management company for the purposes of this Directive is valid in all Member States. As seen in the first part of this paragraph, no management company may carry out activities other than the management of UCITS authorized pursuant to this Directive, unless it concerns the additional management of other collective investment undertakings not subject to this Directive and in which the company management, is subject to prudential supervision, but whose shares can not be traded in other Member States by virtue of it; for the purposes of this Directive, the management of UCITS includes the following functions: investment management, investment management, which includes the legal and accounting services related to the management of the fund, the customer information service, the valuation and determination of the price (also for the purposes of tax returns), control of compliance with applicable regulations, keeping the register of unit holders, distribution of income, issue and redemption of units, settlement of contracts (including the sending of certificates), the keeping of accounting records; finally, the marketing of investments is included in the management activity of a UCITS. We have also seen that Member States may authorize management companies to provide

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management services on a discretionary and individual basis, in addition to UCITS management services, in addition to advising investment portfolios, including some held by pension funds, according to mandates granted by investors (investment portfolios including instruments listed in Section C of Annex I of Directive 2004/39/EC), an authorization that can be extended to the safekeeping and administration of units in collective investment schemes.

The Directive remains unchanged the other general conditions of application established by the national law of the UCITS home Member State, it states that the competent authorities do not authorize a management company if it does not meet the following requirements: a) management company has an initial capital of at least EUR 125 000 taking into account the following: (i) when the value of the portfolios managed by the management company exceeds EUR 250 000 000, the management company must have additional own funds whose amount is 0.02% of the value of the portfolios managed by the management company which exceeds EUR 250 000 000, but the total required of the initial capital and the additional amount must not, however, exceed EUR 10 000 000; ii) for the purposes of this paragraph, the management company's portfolios are to be understood as: - common investment funds managed by the management company, including the portfolios for which the company has delegated the management, but excluding those that it manages in delegation , - an investment company whose management it is a responsibility the management company in question, - other collective investment schemes managed by the management company, including the portfolios for which the company has delegated management, but excluding those that it manages by way of delegation; (iii) irrespective of the amounts indicated above, the own funds of the management company must never be less than the amount established in Article 21 of Directive 2006/49/EC (Directive repealed by Directive 2013/36/EU from 28 to 32, Title IV); b) the persons who effectively direct the management company meet the requirements of honorability and sufficient experience also in relation to the type of UCITS managed by the management company whose names and names of whoever takes over them in office should be immediately notified to the competent authority; the activity of the management company must be decided by at least two persons who meet these requirements; c) the application for authorization is accompanied by a program of activities indicating at least the organizational structure of the management company; and (d) both the central administration and the registered office of the

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management company are situated in the same Member State.

For the purposes of letter a) above, Member States may exempt management companies from the obligation to have up to 50% of the additional amount of own funds referred to in point (i) if they receive a guarantee of the same amount provided by a credit institution or an insurance undertaking; they must have their registered office in a Member State or in a third country provided that they are subject to the prudential rules which the competent authorities consider to be equivalent to those established by Community law.

If there are close links between the management company and other natural or legal persons, the competent authorities shall issue the authorization only if those close links do not impede the effective exercise of their supervisory functions. The competent authorities shall refuse authorization even if the laws, regulations or administrative provisions of a third country to which one or more natural or legal persons are subject to which the management company has close links, or difficulties related to the application of these provisions , hinder the effective exercise of their supervisory functions; management companies are required to communicate the information necessary to verify the absence of obstacles at any time. The competent authorities shall inform the applicant, within six months from the submission of the complete application, of the release or refusal of the authorization, any refusal must be motivated; the management company can start its business as soon as the authorization is issued. The competent authorities may revoke the authorization issued to a management company subject to this Directive only if that company does not use the authorization within 12 months, expressly renounces it or has ceased the activity covered by this Directive for more than six months, if the Member State concerned has not ordered the withdrawal of authorization in such cases; it is also revoked when the company has obtained the authorization by presenting false declarations or by any other irregular means or no longer meets the conditions to which the authorization is subject; other causes of revocation are determined when the company no longer complies with Directive 2006/49/EC (repealed by Directive 2013/36/EU) if the authorization also includes management, on a discretionary and individual basis, of investment portfolios, including those held by pension funds, according to mandates given by investors if such portfolios include one or more of the instruments listed in section C of Annex I of Directive 2014/65/EU (5°). The authorization shall also be revoked when the management company has seriously or systematically infringed the provisions adopted pursuant to this Directive, or falls under one of the cases in which the revocation is required under national law. The Commission

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established with Directive 2009/65/EU that the competent authorities do not issue a permit to a company to access the business if they have not previously obtained communication of the identity of the shareholders or members, direct or indirect, natural or legal persons, who hold a qualified holding as well as the entity of the same; they also deny authorization if, depending on the need to ensure the sound and prudent management of the management company, they are not certain of the suitability of the shareholders or shareholders referred to in the first paragraph. Member States are prohibited from applying provisions to management companies established outside the Community who are already starting or carrying out their activities in a Member State, the consequence of which is to ensure that they are treated more favorably than those granted by the authorities to branches already operating in a Member State; the competent authorities of the Member State in which the branches already operate are consulted prior to the authorization of any management company which is: a subsidiary of another management company, an investment company, a credit institution or an enterprise insurance companies authorized in another Member State by a subsidiary of the parent company of another management company, an investment company, a credit institution or an insurance undertaking authorized in another Member State, or a subsidiary controlled by the same natural persons o legal entities controlling another management company, investment company, credit institution or insurance company authorized in another Member State.

(5°) NOTE: (1) Transferable securities. (2) Money market instruments. (3) Units of a collective investment scheme. (4) Option contracts, standardized futures contracts (futures), swaps, agreements for future exchange of interest rates and other contracts on derivative instruments related to transferable securities, currencies, interest rates or yields, emission allowances or other financial derivative instruments, financial indices or financial measures that can be settled with physical delivery of the underlying or through the payment of cash differentials. (5) Option contracts, standardized futures contracts (futures), swaps, forward contracts and other derivative contracts related to commodities when execution must be by payment of differentials in cash or may occur in cash at the discretion of one of the parties (for reasons other than non-performance or another event that determines the resolution). (6) Option contracts, standardized futures contracts (futures), swaps and other derivative contracts related to commodities that can be settled with physical delivery provided that they are traded on a regulated market, a multilateral trading facility or an organized system of trading, with the exception of wholesale energy products traded in an organized trading system which must

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be regulated by physical delivery. (7) Option contracts, standardized futures contracts (futures), swaps, forward contracts and other derivative contracts related to goods that can not be executed in ways other than those mentioned in point 6 of this section and do not have commercial purposes, having the characteristics of other derivative financial instruments. (8) Derivative financial instruments for the transfer of credit risk. (9) Differential financial contracts. (10) Option contracts, standardized futures contracts (futures), swaps, forward interest rate contracts and other derivative contracts related to climate variables, transportation rates, inflation rates or other official economic statistics, when execution is due to the payment of differentials in cash or can be done in this way at the discretion of one of the parties (rather than in case of default or other event that determines the termination of the contract), as well as other derivative contracts related to assets, rights, obligations, indices and measures, not otherwise mentioned in this section, having the characteristics of other derivative financial instruments, considering, inter alia, whether they are traded on a regulated market, an organized trading system or a multilateral trading system; (11) Emission allowances consisting of any recognized unit meeting the requirements of Directive 2003/87/EC (exchange of greenhouse gas emission allowances in the Community among the companies holding such shares for the purpose of carrying out their activities).

In Chapter V of Directive 2009/65/EC the obligations concerning investment companies are established for access to the collective investment activity of capital raised among the public; access shall be subject to prior authorization by the competent authorities of the Member State of origin of the investment company determining its legal form, furthermore the registered office must be situated in the Member State of origin of the collective investment company, which can not carry out activities other than those provided for by the Directive in Article 1 (2), as set out in the first part of this paragraph. Without prejudice to the other general conditions of application established by the national law of the UCITS home Member State, the relevant competent authorities shall not authorize an investment company which has not designated a management company, unless the investment company has capital sufficient initial amount of at least EUR 300 000. In addition, when an investment company has not designated a management company authorized under this Directive, the following conditions shall apply: (a) the authorization must be refused, unless the application for authorization is accompanied by an activity program indicating at least the organizational structure of the investment company; b) the company representatives of the investment

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company must meet the requisites of adequate honourableness and experience, also in relation to the type of business managed by the investment company and, to this end, the names of the company representatives and of anyone who takes them their office must be communicated as soon as possible to the competent authority; the choice of the investment company's business must be carried out by at least two persons who meet these requirements; a company representative is a person who, according to the law or the deed of incorporation, represents the investment company or effectively determines the address of the activity; (c) where close links exist between the investment company and other natural or legal persons, the competent authorities must issue the authorization only if those close links do not impede the effective exercise of their supervisory functions. The competent authorities of the Member State of origin of the investment firm shall refuse authorization even if the laws, regulations or administrative provisions of a third country to which one or more natural or legal persons are subject with which the investment company has close links, or difficulties inherent in the application of these provisions, hinder the effective exercise of their supervisory functions. The competent authorities of the investment company's home Member State require investment companies to provide the information to the same authorities as they require.

In the event that the investment company has not designated a management company, the investment firm shall receive a communication of the release or refusal of the authorization within six months of the submission of a complete application. The refusal must be motivated. An investment company can start its business as soon as the authorization is issued. The competent authorities of the Member State of origin of the investment company may withdraw the authorization granted to an investment company subject to this Directive only when that company: (a) does not use the authorization within twelve months, expressly disclaims or has ceased to exercise the activity covered by this Directive for more than six months, if the Member State concerned has not ordered the authorization to lapse in such cases; b) has obtained authorization by presenting false declarations or by any other irregular means; c) no longer fulfills the conditions to which the authorization was subject; (d) has seriously or systematically infringed the provisions adopted pursuant to this Directive; or e) falls under one of the circumstances in which the revocation is provided for by national law. For investment companies that have not designated an authorized management company in accordance with Directive 2009/65/EC, Articles 13 and 14 of the same directive (operating conditions) are applicable, as compatible, with articles laying down provisions on the possibility of to delegate to third parties for the purpose of more efficient conduct of their activity, the exercise on their behalf of one or more of

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their functions, and also lay down provisions concerning the drafting of the rules of conduct for investment companies by the investment companies they must observe at all times; in these provisions, the reference to management companies is to be considered an investment company, observing that investment companies manage only the assets of their portfolio and do not receive, under any circumstances, positions regarding the management of assets on behalf of third parties.

The Member State of origin of the investment company draws up prudential rules that investment companies operating without having designated a management company authorized under this Directive must always comply.

In particular, the authorities; competent authorities of the investment firm's home Member State, taking also into account the nature of the investment company, require it to have a good administrative and accounting structure, control and safeguard mechanisms for the electronic processing of data and internal control procedures adequate that include, in particular, a discipline for the personal transactions of employees or for the holding or management of investments in financial instruments for the purpose of investment of its initial capital and which, at least, ensure that any transaction in which the company intervenes it can be rebuilt as regards origin, counterparties, nature and place and time at which it was carried out and that the assets of the investment company are invested in accordance with the articles of association and the rules in force.

Directive 2009/65/EC establishes that the assets of an investment company are entrusted to a depositary, a responsible entity, according to the national law of the investment company's Member State of origin, vis-Ă -vis the investment company itself and the owners of quotas, of any loss suffered by them as a consequence of the negligence or wrongful fulfillment of his obligations. The functions of an investment company and a depositary can not be exercised by the same company; in the exercise of its functions, the depositary acts exclusively in the interests of unit holders. The law or the deed of incorporating investment companies define the conditions for substitution of the depositary and provide for rules to ensure the protection of unit holders in the event of such replacement. The responsibility of the depositary referred to above is not influenced by the fact that it has entrusted to a third party all or part of the values held in custody. The obligations of the depositary enshrined in the directive are to ascertain: a) that the sale, issue, repurchase, redemption and cancellation of the shares made by the investment company or on its behalf are carried out in accordance with the law and the act constitutive of the investment company; b) that in transactions relating to the capital of the investment company, the countervalue is remitted

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to it within the terms of use; and c) that the returns of the investment company receive the destination in accordance with the law and with the deed of incorporation. The Member State of origin of the investment company can establish an exemption on the obligation to have a depositary in accordance with Directive 2009/65/EC for investment companies established in its territory that market their units exclusively through one or more stock exchanges on whose official listing these units are admitted; articles 76, 84 and 85 of the same directive do not apply to such investment companies.

However, the rules for valuing the assets of these investment companies are set out in the applicable national law or in the deed of incorporation. The Member State of origin of the investment company may establish that investment companies established in its territory, which market at least 80% of their shares through one or more stock exchanges referred to in the deed of incorporation, do not have the obligation to have a depositary pursuant to this Directive, provided that such shares are admitted to official listing on the stock exchanges of the Member States on whose territory the shares are marketed and provided that the off-exchange transactions are carried out by the investment company only at market price. The instrument of incorporation of the investment company indicates the stock exchange of the country in which the units are traded, the listing of which determines the price of offexchange transactions carried out in this country by the said investment company. The Member State shall make use of the exemption referred on the depositary only if it considers that the unitholders benefit from a protection equivalent to that enjoyed by the holders of units of UCITS having a depositary pursuant to this Directive. In particular, investment companies must: a) in the absence of national legislation on the matter, indicate in the deed of incorporation the methods for calculating the net asset value of the units; b) intervene in the market to prevent the market value of their units from diverging from their net asset value by more than 5%; c) establish the net asset value of the units, notify the competent authorities at least twice a week and publish it twice a month. An independent auditor ascertains at least twice a month that the value of the units is calculated in accordance with the law and the articles of association of the investment company. On this occasion, the auditor ensures that the assets of the investment company are invested according to the rules established by the law and by the deed of incorporation of the investment company. Member States shall inform the Commission of the particulars of investment companies which benefit from the exemptions concerning the depositary.

The depositary has its registered office or is established in the same Member State as the investment company and is an institution subject to prudential

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regulation and continuous supervision. Member States shall establish the categories of institutions among which depositaries may be chosen. The depositary allows the competent authorities of the UCITS home Member State to obtain, on request, all the information which the depositary has obtained in the performance of its tasks and which is necessary for the competent authorities to monitor compliance by the UCITS, to this Directive and if the management company's home Member State is not the UCITS home Member State, the depositary shall enter into a written agreement with the management company which regulates the flow of information deemed necessary to the order to enable it to carry out its obligations and other legislative, regulatory or administrative provisions which are relevant to the depositaries of the UCITS home Member State. Directive 2009/65/EC defines the possibility for the Commission to adopt implementing measures concerning the measures to be taken by the depositary in order to fulfill its obligations regarding a UCITS managed by a management company established in another Member State Member State, including the information to be included in the standard agreement used by the depositary and the management company on the obligations of the depositary. Those measures, designed to amend non-essential elements of this Directive by supplementing it, shall be adopted in accordance with the regulatory procedure with scrutiny defined by Decision 1999/468/EC and subsequent amendments laying down the procedures for the exercise of implementing powers conferred on the Commission.

Among the obligations of the investment policies set out in the provisions of Chapter VII of Directive 2009/65/EC, it is established that a UCITS may purchase units of other UCITS or other collective investment undertakings referred to in Article 50 (1) e), provided that no more than 10% of its assets are invested in the units of the same UCITS or other collective investment scheme. Member States can raise this limit to a maximum of 20%.

Investments in units of collective investment undertakings other than UCITS may not exceed, in total, 30% of the assets of the UCITS. The provisions defining the investment policy for a UCITS with Article 56 establishes that: i) an investment company or management company acting for all the mutual funds it manages and which fall within within the scope of application of Directive 2009/65/EC, does not acquire shares giving voting rights and enabling it to exercise significant influence over the management of an issuer and until subsequent coordination, the Member States must take into existing rules in the law of the other Member States which define the principle; ii) a UCITS may not acquire more than: a) 10% of non-voting shares of the same issuer; b) 10% of bonds of the same issuer; c) 25% of the units of a single

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UCITS or other collective investment undertaking within the meaning of the same Directive as defined in Article 1 (2), points a and b; or d) 10% of money market instruments of a single issuer; the limits in letters b), c) and d) may be exceeded at the time of purchase if at that time it is not possible to calculate the gross amount of the bonds or money market instruments or the net amount of the securities issued . An investment or management company may acquire the shares held by a UCITS in the capital of a third country company investing its assets principally in securities of issuers having their registered office in that country if, under the legislation of this lastly, such participation represents for the UCITS the only possibility of investing in securities of issuers of that country if the company of the third State complies in its investment policy with the limits established by Articles 52 and 55 and conditions i) and ii) previous. Member States may waive the application of the conditions set out in statutory i) and (ii) above with respect to: a) transferable securities and money market instruments issued or guaranteed by a Member State or its local authorities; b) transferable securities and money market instruments issued or guaranteed by a third State; c) transferable securities and money market instruments issued by an international public body to which one or more Member States belong; (d) shares held by one or more investment companies in the capital of subsidiaries which only manage, advise or market in the country in which the subsidiary is established, with regard to the repurchase of shares at the request of the holders , exclusively for his or their account. In Article 57 of Directive (EU) 2009/65, the Commission defines the derogation conditions for the Obligations of the UCITS investment policy (Chapter VII, Articles 49 to 57), stating that they are not required to observe the indicated limits if exercise the relevant subscription right to transferable securities or money market instruments that form part of their assets. Member States, while ensuring the principle of risk spreading can be respected, may grant exemptions from Articles 52 to 55 to newly created UCITS for a period of six months from the date of their authorization. If exceeding the limits of Chapter VII of the Directive takes place independently of the UCITS's will or following the exercise of the subscription rights, the latter, in its sales operations, has as its priority objective the regularization of this situation while account of the interest of unitholders.

A feeder UCITS is a UCITS or an investment compartment which, by way of derogation from Article 1 (2) (a), Articles 50, 52, and 55 and Article 56 (2) (c), has received approval to invest at least 85% of its assets in units of another UCITS or in its investment funds (master UCITS).

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A master UCITS is a UCITS or an investment compartment: a) has at least one feeder UCITS among its unitholders; b) is not itself a feeder UCITS; and c) does not hold units of a feeder UCITS. The master UCITS is subject to the following exceptions: a) if a master UCITS has at least two feeder UCITS as unit holders, Article 1 (2) (a) and Article 3 (b) do not apply) , giving the master UCITS the option to raise capital or not with other investors; in cases where the master UCITS does not raise capital from the public in a Member State other than that in which it is established but has only one or more feeder UCITS in that Member State, they do not apply the special provisions applicable to UCITS which market their shares in Member States other than those in which they are established and laid down in Chapter XI (Articles 91 to 96), in addition the relevant authorities (of the Member State in which the UCITS markets its units other than the Member State of origin) they can not take measures against this UCITS in the event of infringement of the laws, regulations and administrative provisions in force in that Member State, which fall outside the scope of this Directive or the obligations set out in Articles 92 and 94, (derogation for Article 108 paragraph 1, paragraph 2), interventions implemented by the Authority of the home Member State of the undertaking for collective investment in transferable securities.

It is obligatory for the management companies and for each of the mutual funds it manages, and for the investment company, to publish a prospectus containing the information necessary for investors to make an informed judgment on the investment proposed to them and in particular on the related risks. The prospectus includes, regardless of the instruments in which the investment is made, a clear and easily understandable illustration of the fund's risk profiles. In addition to the prospectus, they must publish an annual report for each financial year within four months of the financial year (balance sheet or balance sheet) and a semi-annual report covering the first six months of each financial year, within the next two months. The UCITS makes public, using methods adequate, the issue or sale price, repurchase, or redemption of its units each time it issues, sells, repurchases or redeems the units and at least twice a month. The competent authorities may allow a UCITS to reduce the frequency to once a month, provided that this derogation does not affect the interests of unitholders. All marketing communications to investors are clearly identifiable as such and must be correct, clear and not misleading. In particular, marketing communications containing an invitation to purchase units of UCITS and bearing specific information on a UCITS shall not contain statements that conflict with the information contained in the prospectus and the "key investor information" and mention the existence of the prospectus and the availability of key investor information by specifying

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where and in which language investors or potential investors can obtain such information or documents and how they can access it.

The Commission established in Directive 2009/65/EC that key investor information should be provided free of charge to the investors themselves in the form of an ad hoc document, in good time before the UCITS is signed, with the aim of helping them to adopt informed decisions on investments; it is important that such key information contains only the essential elements for making such decisions. The obligation to fully harmonize the nature of the information to be included in the "key investor information" is established to ensure adequate investor protection and comparability, information that should be presented in a short format. A single document of limited length that presents the information in a specific order is the most appropriate way to obtain the clarity and simplicity of presentation required by retail investors, which allow for useful comparisons, in particular the costs and the risk profile, relevant for the purpose of the investment decision. The European Commission has established that the competent authorities of each Member State may make publicly available, in a dedicated section of their website, the key investor information relating to all UCITS authorized in the Member State in question, information that must be presented for all UCITS. Management companies or, where applicable, investment companies are required to provide key investor information to relevant entities, depending on the marketing method used (direct sales or through intermediary), intermediaries must provide such information to customers and potential customers. In order to strengthen legal certainty, it is necessary to ensure that a UCITS which markets its units on a cross-border basis can easily access, in electronic form and in a language commonly used in international financial circles, full information on the laws, regulations and administrative provisions applicable in the UCITS host Member State and which specifically concern the provisions adopted for the marketing of UCITS units. The Commission considers that the obligations related to the publication of such information should be governed by national law.

In order to facilitate the access of UCITS to the markets of the other Member States, it is appropriate to provide that the UCITS is obliged to translate only the key investor information in the official language or one of the official languages of a UCITS host Member State, or in a language approved by its competent authorities; in this information the language (s) in which the other mandatory information documents and additional information are available must be specified. Translations are performed under the responsibility of the UCITS, which decides whether a simple or sworn translation is required.

Member States are required to take the administrative and organizational

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measures necessary for the cooperation between their national authorities and the competent authorities of other Member States, including through bilateral or multilateral agreements between the aforementioned authorities, agreements which may provide for delegation voluntary work.

The European Commission considers it necessary to strengthen the convergence of powers available to the competent authorities with the aim of applying Directive 2009/65/EC in an equivalent manner in all Member States, defining a minimum set of common powers, in line with the provisions of other Community legislation on financial services, to ensure the effectiveness of supervision. Member States are responsible for laying down the rules on penalties, criminal or administrative, and administrative measures applicable in the event of infringement of this Directive including the measures necessary to ensure the enforcement of these penalties. It also considers it necessary to strengthen the provisions concerning the exchange of information between the competent national authorities and to strengthen the duties of mutual assistance and cooperation. With regard to the provisions on disclosure, the Commission considers it necessary to assume the power to adopt measures to indicate the conditions that must be satisfied when the prospectus is provided on a durable medium other than a card or through a website which does not constitute a durable support, complete and detailed content, form and presentation of key investor information taking into account the nature or different components of the relevant UCITS, and the specific conditions for presenting key investor information on a durable medium different from paper or via a website that does not constitute a durable medium.

In Chapter IX of Directive 2009/65/EC detailed provisions are laid down on the obligations concerning the information to be communicated to investors; in Chapter X the general obligations of a UCITS, in Chapter XI the special provisions applicable to UCITS which market their units in Member States other than those in which they are established, in Chapter XII, provisions concerning the authorities responsible for authorization and supervision.

Directive 2009/65/EC is amended by Article 63 of Directive (EU) 2011/61 which inserts Article 50a, modifies paragraph 2 of article 112 and modifies paragraph 1 of article 112a. Further changes are made by Directive 2014/91/EU with reference to market developments and the experience gained so far by market participants and supervisors, in particular to address disparities between national rules on functions and responsibilities depositaries, remuneration policy and sanctions.

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Subsequent amendments to Directive 2009/65 /EC are made with Directive (EU) 2014/91; the Commission intervenes to counteract the potentially negative effects of poorly conceived remuneration schemes on the sound risk management and on the control of risk assumption by individuals, providing for the express obligation on asset management companies of collective investment undertakings securities (UCITS) to create and maintain, for the categories of persons whose professional activities have a significant impact on the risk profiles of the UCITS they manage, policies and remuneration practices in line with sound and effective risk management.

With reference to the legal entities designated for the appointment of depositaries, to the related responsibilities in cases where the assets of the UCITS held in custody are lost or in cases of incorrect exercise by the depositary of its oversight duties and with the intention to harmonize the regulatory obligations are adopted through Regulation (EU) 2014/91, additional rules to those already defined by Directive 2009/65/EC. A noncompliant exercise by the depositaries may result in the loss of assets but also in the loss of value of the assets, when, for example, a depositary do not adopt measures regarding investments that are not in line with the fund rules. it is appropriate to establish the obligation for the UCITS to designate a single depositary exercising the general oversight function on the assets of the UCITS and with this obligation it must be ensured that the depositary has an overall view of the activities of the UCITS and that the managers of the fund that investors have a single point of reference in case of problems related to the custody of the assets or the exercise of the oversight functions. The custody of assets includes the keeping in custody of the assets, or in the event that the assets are of such a nature that it does not allow them to be kept in custody, the verification of ownership of the assets as well as the keeping of the records relating to these activities. The directive also imposes an obligation on the depositary to act honestly, fairly, professionally and independently in the interests of the UCITS and investors, while exercising their functions. With a view to ensuring a harmonized approach to the exercise of the functions of depositaries in all Member States, irrespective of the legal form adopted by the UCITS, the Commission introduces a uniform list of oversight obligations for depositaries in relation to the UCITS in the form of a company (investment company) and a UCITS constituted in a contractual form.

It is mandatory for depositaries to distinguish between assets that can be held in custody and those that can not be held in custody for which it is obligation to register and verify the property; the two categories of activity must be clearly differentiated in order to facilitate the return of the lost assets,

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applicable only to the first categories of activity. Directive (EU) 2014/91 among other changes made to Article 22 of Directive 2009/65/EC establishes that the assets held in custody by the depositary can not be reused on their own account by the latter or by a third party to whom custody has been delegated. Conditions are stipulated for the re-use of assets on behalf of the UCITS: a) the re-use of these assets is performed on behalf of the UCITS; b) the depositary shall execute the instructions of the management company on behalf of the UCITS; c) re-use takes place to the advantage of the UCITS and in the interest of the unitholders; and (d) the transaction is covered by a high quality liquid collateral received from the UCITS through a contract with the transfer of the ownership title. The market value of the collateral is at all times at least equal to the market value of the reused assets plus a premium.

Member States must ensure that in the event of the insolvency of the depositary and / or any third party located in the Union to which the custody of assets of a UCITS has been delegated, the assets of the UCITS retained in custody are unavailable for distribution or to the sale for the distribution of the proceeds among the creditors of such depositary and / or third party.

If a central securities depository (CSD) established in a Member State of the European Union (as defined in Article 2 (1), point 1, of Regulation (EU) No 909/2014), or a CSD of a country third provides the management services of a securities settlement system, as well as at least the initial registration of securities in an accounting system by initial credit, or the provision and management of securities accounts at the highest level, as specified in section A of the Annex to the same regulation 909/2014 (6°), the provision of such services by the said CSD in respect of the UCITS securities initially registered in a system of accounting records by initial accreditation by said CSD should not be considered as delegation of custody functions. Custody of custody of UCITS securities to any CSD, or to any CSD of a third country by a depositary is considered to be delegation of custody functions; it is appropriate that the third party to whom custody of the assets is delegated may maintain an omnibus account (single account in which funds or securities of multiple entities converge) as a separate joint account for several UCITS, as set out in Regulation (EU) 2018/1619 for Depositaries amending regulation (EU) 2016/438. As the UCITS (or related management company) is obliged to appoint the depositary, it is obvious that delegating certain functions (such as custody of values, property management) is a possibility that is defined only for depositaries.

(6°) NOTE: Services provided by CSDs that contribute to improving the security, efficiency and transparency of securities markets, which may include, but are not limited to: Services related to the settlement service, for

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example : a) organization, as agent, of a securities lending mechanism between participants in a securities settlement system, b) supply, as agent , guarantee management services for participants in a securities settlement system, c) settlement of settlement orders, addressing of instructions, confirmation and verification of transactions. Services related to notary and centralized administration services, for example: a) provision of services related to shareholder registers, b) support for the processing of corporate transactions, including aspects related to taxation, to assemblies c) provision of services for new issues, including the assignment and management of ISIN codes and the like, d) addressing and processing of instructions, collection and processing of commissions and related communication. Establishment of links between CSDs, provision, maintenance or management of securities accounts in relation to the settlement service, collateral management and other ancillary services. Other services, such as: a) general warranty management services as agent, b) disclosure, c) providing information, data and statistics to the markets / statistical offices or other governmental entities or intergovernmental, d) IT services.

Investors in UCITS may assert the depositary's responsibility, directly or indirectly, through the management company or the investment company.

The appeal against the depositary must not depend on the legal form of the UCITS (corporate or contractual) or on the legal nature of the relationship between the depositary, the management company and the unitholders. The right of unitholders to enforce the responsibility of depositaries does not result in duplication of recourse or unequal treatment of unitholders. Depositaries are subject to the same obligations regardless of the UCITS legal form. The uniformity of obligations enshrined in Directive (EU) 2014/91 increases legal certainty, improves investor protection and contributes to the creation of uniform market conditions; Section 3 of Chapter 5 is deleted, obligations concerning the depositary, with reference also to the condition of derogation from the obligation to appoint the depositary for the UCITS defined in this section because the Commission has not received any notification of cases of appeal of the investment company to the exemption from the general obligation to entrust the assets to a depositary, moreover it considered the obligations in this section redundant with respect to the same Directive 2009/65/EC which included the provisions of the same section (Chapter IV) to exception of paragraph 4 of article 32, deemed not used beyond the strengthening of investor security caused by its deletion . The Commission with Directive (EU) 2014/91 has decided to impose stricter sanctions against the illegal

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behavior of those concerned, and also establishes that all sanctions communicated to the public must be communicated to ESMA at the same time, which publishes an annual report on all penalties imposed to allow further uniformity to be strengthened supervisory performance, in accordance with Regulation (EU) No 1095/2010.

In conclusion, the legislative framework of UCITS and related management companies is currently defined by Directive 2009/65 /EC and subsequent amendments made by Directive (EU) 2014/91 which establish the provisions for access to the activity; the capital adequacy of the management companies is defined in Directive 2013/36/EU to which reference is made to the same Directive 2009/65/EC and subsequent amendments, for investment companies that make use of the exception to not designate the management company, the capital adequacy is enshrined in Directive (EU) 2014/65 for Member States, the same directive that dictates the provisions for access to the activity of investment companies that do not carry out collective investment and management activities, a directive that is the object of studies in the next paragraph.

4 - INVESTMENT COMPANY: DIRECTIVE (EU) 2014/65 Shortcomings in the corporate governance of numerous financial institutions, the absence of valid control and balance systems within them contributed to the financial crisis as advocated by regulatory bodies (public bodies) at international level. When risk-taking is excessive and imprudent it can lead to the failure of individual financial institutions and cause systemic problems both in the Member States and globally; further negative and harmful effects on the market derive from incorrect behavior of companies that provide services to customers, as they can damage investors and cause their loss of trust. Due to the negative effects caused by weaknesses in corporate governance mechanisms, Directive 2004/39/EC (MiFID directive: Markets in Financial Instruments Directive) is repealed with Directive (EU) 2014/65 (MiFID II directive). The High Level Group of Experts on Financial Supervision in the EU called on the EU to develop a more harmonized set of financial rules. In the context of the future European supervisory architecture,

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the European Council of 18 and 19 June 2009 emphasized the need to develop a single European code applicable to all financial institutions in the internal market. The MiFID Directive (2004/39/EC) immediately underwent several changes including Directive 2006/49/EC currently repealed by Directive 2013/36/EU, therefore the Commission considers that it should proceed to the recast in the new amendments made with the MiFID II directive (2014/65/EU).

Directive (EU) 2014/65 applies to investment firms, market operators, regulated markets, data communication service providers and third country companies offering services or carrying out investment activities through the establishment of a branch in the Union and establishes requirements in relation to the following elements: (a) authorization and operating conditions for investment firms; (b) provision of investment services or investment activity by companies from third countries through the establishment of a branch, c) authorization and operation of regulated markets, d) authorization and operating conditions of data communication service providers and e) supervision, collaboration and monitoring of the application of the legislation by the competent authorities. Paragraphs 3 and 4 of Article 1 define the provisions that also apply to investment firms and credit institutions authorized under Directive 2013/36/EU, when they sell or recommend to customers structured deposits (consisting of several options, such as the repayment of the credit upon expiry of the deposit and a periodic remuneration). Investment firms may receive authorization under the conditions set out in Chapter I of the MiFID II Directive, (from Article 6 to Article 20); articles that also establish the conditions for market managers managing a multilateral trading system or an organized trading system.

Article 15 defines the capital endowment of an investment firm: Member States shall ensure that the competent authorities issue the authorization only on condition that the investment firm has sufficient initial capital that meets the requirements of the regulation (EU) no. 575/2013, taking into account the nature of the services or activities in question.

This directive is intended to regulate the companies whose predominant activity is to perform professional services and / or investment activities and excludes from its field of application anyone who carries out other professional activities defining in particular conditions of derogation from the same with the article 2 and optional derogation conditions at description the Member State of origin in Article 3. Article two of Directive (EU) 2014/65 states that the Directive does not apply: to insurance undertakings or to undertakings performing reinsurance and retrocession (a tool that insurance companies use to insure themselves), it is possible, in fact, that they do not

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have the means necessary to compensate the insured for disasters linked to large-scale events (natural disasters, a chain); there is talk of retrocession when the reinsurer it is reassured, in turn, for the same reasons. The article provides an exemption from the authorization restriction for investment companies in transferable securities also for collective investment schemes and pension funds, whether they are harmonized or not at Union level, as well as depositaries and managers of such securities organisms. Article 2 of the Directive defines a derogation also for persons who take on the role of market makers, who negotiate on their own account derivative instruments on commodities or emission quotas or derivatives thereof, (excluding those that negotiate on their own account by executing orders from customers) ; same for persons providing investment services other than proprietary trading, in commodity derivatives or emission allowances or instruments derived from the same to customers or suppliers of their principal business with the conditions for each of those cases, considered both individually and in aggregate form, this is an activity ancillary to their principal activity within the group, provided that such main activity does not consist in the provision of investment services within the meaning of this Directive, of banking activities within the meaning of the Directive 2013/36/EU or in market making activities in relation to commodity derivatives, these persons must not apply a high frequency algorithmic trading technique and must formally communicate each year that uses this exemption and, at the request of the competent authority, on what grounds they consider that their activity is ancillary to The main activity.

Excluding the previous dynamics of derogation, the Directive does not apply to persons providing investment services exclusively to filiation network, controlling and controlled; it does not apply to persons providing ancillary investment services in the context of a professional activity, if this activity is governed by legislative or regulatory provisions or by a professional code of conduct that does not specifically exclude the provision of such services; to persons who negotiate on their own account in financial instruments other than commodity derivatives or emission allowances or related derivative instruments and who do not provide other investment services or exercise other investment activities in financial instruments other than commodity derivatives, from the emission quotas or related derivatives, apart from the cases in which such persons assume the role of market maker (operator or financial institution capable of influencing the stock market through the purchase or sale of a considerable number of securities), or are members or participants of a regulated market or MTF or have direct electronic access to a trading venue, or apply a high frequency algorithmic

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trading technique, or trade on their own account when they execute customer orders.

A further derogation concerns operators subject to supplementary supervision of credit institutions, insurance companies and investment firms belonging to a financial conglomerate, regulated supervision of Directive 2002/87/EC, when they process emission allowances, they do not execute customer orders and do not provide investment services or activities other than proprietary trading, provided they do not apply high frequency algorithmic trading techniques; and exemption for persons providing investment services consisting exclusively in the management of employee participation schemes, to persons providing investment services consisting exclusively in managing worker participation schemes and in providing investment services exclusively for their parent enterprise , its subsidiaries or other subsidiaries of its parent company. Are derogated from the Directive the members of the ESCB and other national bodies carrying out similar functions in the Union, other public bodies which are responsible for or involved in the management of public debt in the Union and to international financial institutions created by two or more Member States, that mobilize resources and provide financial assistance to those, among their members, who are facing or are threatened by severe financial difficulties; same for the persons providing investment advice in the exercise of another professional activity not covered by this Directive, provided that such advice is not specifically remunerated. The associations established by Danish and Finnish pension funds are exempted, whose the only objective being the management of the activities of the affiliated pension funds, are derogated the stockbrokers (the financial intermediary that searches and buys, on behalf of the client, in the reference market , the product that offers the best value for money, in English also called stock brokers, often shortened in brokers, by broking, ie "intermediation").

A further derogation is made for electricity transmission system operators (Article 2 (4) of Directive 2009/72/EC (Directive on common rules for the internal market in electricity) and Article 2 (4) of Directive 2009/73/EC (Directive on common rules for the internal market in natural gas) when carrying out their tasks in accordance with the aforementioned Directives or Regulation (EC) No 714/2009 or Regulation (EC) No 715/2009 or the network codes or guidelines adopted pursuant to these regulations, to persons acting as providers of services on their behalf to carry out their tasks under those legislative acts or network codes or guidelines adopted pursuant to these regulations, or to any manager or director of an energy balancing mechanism, network or pipeline system to balance energy supplies and consumption

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when they perform these tasks; the exemption applies to persons who carry out the activities mentioned here only when they perform investment activities or provide investment services related to commodity derivatives in order to carry out such activities. It does not apply in relation to the management of a secondary market, including platforms for the secondary trading of financial transmission rights. Central securities depositaries (CSDs) governed by Union law are also exempted from the application of Directive (EU) 2014/65 insofar as they are governed by this right. Finally, a derogation is also made for the rights conferred by this Directive for the provision of services as a counterparty in transactions carried out by public bodies managing the public debt or by the members of the ESCB in the framework of the tasks assigned to them by the TFEU and Protocol No. 4 on the statute of the European System of Central Banks and of the European Central Bank or performing equivalent tasks pursuant to provisions of national law. The Directive 2014/65/EU in Chapter III, lays down provisions on the rights of investment firms by defining for them and credit institutions authorized under Directive 2013/36/EU (and the provisions of this Directive of Article 1 paragraph 4) the right to freedom to provide services and to engage in investment activities in the internal market (between the Member States of the European Union), the possibility of establishing branches, the right of access to regulated markets, the right of access to central counterparty, clearing, settlement and right to designate the settlement system; in the same chapter provisions relating to the CCP, clearing and settlement agreements in the context of multilateral trading systems are laid down. Chapter IV sets out provisions for the provision of investment services and activities by companies from third countries.

The Commission may adopt delegated acts to clarify when an activity is exercised sporadically; ESMA shall develop draft regulatory technical standards to specify the criteria for determining when an activity should be considered ancillary to the main activity at group level. The criteria issued by the ESMA consider: the need for ancillary activities to constitute a minority of the activities at group level and the size of the trading activity compared to the overall market trading activity in that asset class. In determining the extent to which ancillary activities constitute a minority of group-level activities, ESMA may establish that is taken into consideration the capital employed for ancillary activities in relation to the capital employed for the principal activity.

In any case, however, this element is not sufficient to prove that the activity is ancillary to the main activity of the group. They are however excluded the intergroup transactions referred to in Article 3 of Regulation (EU) no.

648/2012 aimed at creating group liquidity or risk management (derogated

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from the norm as operations in the filiation network), transactions in derivative instruments are also excluded, whose ability to reduce risks directly related to commercial activities or treasury financing activities can be measured objectively and are excluded transactions in commodity derivatives and in emission quotas made to comply with the obligation to provide liquidity to a trading venue, when such obligation is prescribed by the regulatory authorities in accordance with Union law or national laws, regulations and administrative provisions or negotiating venues.

With Article 3, the Commission defines the possibility for Member States not to apply this Directive to the persons of which they are the Member State of origin, whose activities are authorized and regulated at national level and which: authorized to hold funds or securities belonging to customers and for this reason can never be in debt with their customers; are not authorized to provide investment services, except for the receipt and transmission of orders in transferable securities and units of collective investment undertakings and / or investment advisory services relating to such financial instruments, and in connection with the provision of services such services are authorized to transmit orders only to: i) investment firms authorized under this Directive, ii) credit institutions authorized under Directive 2013/36/EU, iii) branches of investment firms or credit institutions authorized in a third country and which are required to comply with and comply with prudential rules considered by the competent authorities to be at least as stringent as those laid down in this Directive, in Regulation (EU) no. 575/2013 or in Directive 2013/36/EU, iv) collective investment undertakings authorized under the law of a Member State to sell shares to the public, as well as managers of such bodies, or c) investment companies with fixed capital, pursuant to Article 17 (7) of Directive 2012/30/EU of the European Parliament and of the Council, whose securities are listed or traded on a regulated market in a Member State. Member States may also waive the application of the Directive to persons who provide investment services exclusively in commodities, emission allowances and / or derivative instruments on the same goods for the sole purpose of limiting the commercial risks of their clients, when the latter are exclusively local power companies within the meaning of Article 2 (35) of Directive 2009/72/EC (Directive laying down harmonized European standards for the internal electricity market) and / or natural gas undertakings within the meaning of 2 (1) of Directive 2009/73/EC (Directive laying down harmonized European rules for the internal market in natural gas), provided that such customers jointly hold 100% of the capital or the voting rights of such persons, they exercise joint control and are exempt under Article 2 (1) (j) of the same Directive, the conditions described above, in the case in which they carry out

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such investment services personally. Article 3 establishes the optional exemption for the Member State of origin for persons who provide investment services exclusively in emission allowances (any unit recognized to comply with the requirements of Directive 2003/87/EC which quantifies the same emission allowances as greenhouse gases) and / or derivative instruments on them for the sole purpose of limiting the commercial risks of their customers, when the latter are exclusively managers, then the person who manages or controls a plant or, if required by national legislation, to which delegated a decisive economic power as regards the technical exercise of the same (Article 3 (f) of Directive 2003/87/EC establishing a system for greenhouse gas emission allowance trading within the Community, allocated to operating in sectors which are likely to produce polluting emissions), provided that such customers jointly hold 100% of the capital or the votes of such persons, exercise joint control and are exempt under Article 2 (1) (j) of this Directive if they are to carry out such investment services personally. With the same article and therefore for the exempted persons, obligations are defined for the Member States to define requirements similar to those established by the same directive with regard to the conditions and procedures for authorization and continuous supervision, behavioral standards or provisions aimed at ensuring the protection of investors as registration of all the operations necessary for the authorities to perform their duties, telephone communications, telephone records, organizational requirements established as effective organizational provisions in order to prevent conflicts of interests between companies, managers, employees, agents connected persons, persons connected directly or indirectly, customers, or conflicts of interest determined by the obtaining of undue incentives by third parties or by remuneration and by incentive plans of the same investment company; similar provisions regarding the information to be provided to customers when the actions taken to prevent conflicts of interest are not sufficient.

Directive (EU) 2014/65 establishes provisions identifying a professional client with Annex II allowing investment companies to be able to implement lower security conditions in view of their knowledge and expertise necessary to make their own decisions regarding investments and properly assess the risks they take. The investment firm is obliged to notify the client that the information in the possession is a professional client and therefore a lower level of contractual security; however, the customer can decide whether or not to accept security conditions at a lower level, and therefore whether or not to limit their decision-making power with regard to the transactions to be carried out with the financial instruments involved in the investment. In Annex I of the Directive Section A defines the investment services provided by

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investment companies: 1) Receipt and transmission of orders relating to one or more financial instruments, 2) Execution of orders on behalf of clients, 3) Trading on own account 4) Management of portfolios, 5) Advice on investments, 6) Underwriting of financial instruments and / or placement of financial instruments on the basis of an irrevocable commitment, 7) Placing of financial instruments without irrevocable commitment, 8) Management of multilateral trading systems, 9) Management of organized trading systems.

Section B of the same annex defines ancillary services: 1) Custody and administration of financial instruments on behalf of clients, including custody and related services such as cash / collateral management and excluding the management of securities accounts at the level higher, 2) Granting loans or loans to investors to allow them to carry out a transaction related to one or more financial instruments, in which the company granting the credit or loan intervenes, 3) Business consultancy relating to the structure capital, industrial strategy and related matters, as well as consultancy and services relating to mergers and the purchase of companies, 4) Exchange service when this service is linked to the provision of investment services, 5) Investment research and analysis financial or other forms of general recommendation concerning transactions in financial instruments, 6) Services related to underwriting, 7) Investment services and activities, as well as ancillary services of the type referred to in sections A or B of Annex 1, linked to the derivative instruments referred to in Section C, points 5), 6) , 7) and 10), if linked to the provision of investment or accessory services. Section C defines the financial instruments: 1) Transferable securities, 2) Money market instruments, 3) Units of a collective investment scheme, 4) Option contracts, standardized futures contracts (futures), swaps, agreements for future exchange of interest rates and other contracts on derivative instruments related to transferable securities, currencies, interest rates or returns, emission allowances or other financial derivative instruments, financial indices or financial measures that can be settled with physical delivery of the underlying or through payment of differentials in cash, 5) Option contracts, standardized futures contracts (futures), swaps, forward contracts (futures) and other derivative contracts related to commodities when execution is due to the payment of differentials in cash or in cash at the discretion of one of the parties (for reasons other than non-performance or by another event that determines the resolution), 6) Option contracts, standardized futures contracts (futures), swaps and other derivative contracts related to commodities that can be settled with physical delivery provided that they are traded on a regulated market, a system multilateral trading facility or an organized trading facility, with the exception of wholesale energy products traded on an organized trading system that are to be settled with physical

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delivery, 7) Option contracts, standardized futures contracts (futures), swaps, contracts forward contracts and other derivative contracts related to goods that can not be executed in ways other than those mentioned in point 6 of this section and do not have commercial purposes, having the characteristics of other derivative financial instruments, 8) Financial instruments derivatives for the transfer of credit risk, 9) Differential financial contracts 10) Option contracts, standardized futures contracts (futures), swaps, forward interest rate contracts and other derivative contracts related to climate variables, transportation rates, inflation rates or other official economic statistics , when the execution should take place through the payment of differentials in cash or can be done in this way at the discretion of one of the parties (rather than in case of default or other event that determines the termination of the contract), as well as other contracts on instruments derivatives related to assets, rights, obligations, indices and measures, not otherwise mentioned in this section, having the characteristics of other derivative financial instruments, considering, inter alia, whether they are traded on a regulated market, an organized trading system or a multilateral trading facility; 11) Emission allowances consisting of any unit; recognized as complying with the requirements of Directive 2003/87 / EC (emission allowance trading system).

Finally, data communication services are defined in Annex I in section D: 1) Management of an authorized publication device, 2) Management of a consolidated publication system, 3) Management of an authorized reporting mechanism.

With the directive being studied in this paragraph, the European Commission has considered the evolution of negotiation technology in the last decade, widely used by market participants; numerous participants use algorithmic negotiation, in which a computerized algorithm automatically determines some aspects of an order with minimal or no human intervention. Therefore it believes that it is necessary to define provisions regarding the risks deriving from the same negotiation technique; the provisions take into account that the use of algorithms in the post-trade treatment of the operations performed does not constitute an algorithmic negotiation. This directive defines algorithmic negotiation : trading of financial instruments in which an automated algorithm automatically determines the individual parameters of orders, such as whether to initiate the order, timing, price or quantity of 'order or how to manage the order after its presentation, with minimal or no human intervention and does not include the systems used solely to transmit orders to one or more trading venues, to process orders that do not involve the determination of trading parameters, to confirm orders or to perform posttrade processing of operations performed. The term high frequency

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algorithmic negotiation technique is defined: any algorithmic negotiation technique characterized by: a) infrastructures aimed at minimizing network and other latencies, including at least one of the structures for algorithmic insertion of the order: co-location (distance from the trading venue), proximity hosting or direct electronic access at high speed; b) determination by the system of the initialization, generation, transmission or execution of the order without human intervention for the individual order or negotiation, and c) high intraday traffic of messages consisting of orders, quotations or cancellations.

The Commission has established provisions for investment firms operating with algorithmic negotiations to pursue a market making strategy to carry out this activity on a continuous basis in a specific range of trading hours of the trading venue. Regulatory technical standards clarify what constitutes a specific range of trading hours of the trading venue ensuring that this specific range is relevant with respect to the total trading time, taking into account the liquidity, the size and nature of the specific market and the characteristics of financial instruments traded. Investment firms that carry out algorithmic negotiations, pursuing a market making strategy, are obliged to put in place controls and adequate systems for this activity, understood in a specific way in relation to its context and its purpose. The definition of this activity is therefore independent of definitions such as that of "market support activities" as set out in Regulation (EU) no. 236/2012 of the European Parliament and of the Council. Regulation 236/2012/EU defines activities to support trade (market making), the activities of an investment firm, a credit institution, a third country entity or a company that trade on behalf of precisely in application of the derogation conditions of the MiFID Directive and being a member of a trading venue or a market in a third country whose legal and supervisory framework has been declared equivalent by the Commission pursuant to Article 17 (2), when acting as the principal operator for a financial instrument traded on or on a trading venue, in one of the following ways: (i) simultaneously communicating fixed and competitive courses of purchase and sale at a comparable level, thereby providing liquidity regular and continuous market, ii) as part of its usual business, by executing orders initiated by customers or by responding to requests for sale or purchase of clients, iii) covering the positions deriving from the execution of the tasks referred to in points i) and ii). A specific subset of the algorithmic negotiation is constituted by the high frequency algorithmic negotiation, in which a trading system analyzes data or high-speed market signals and then send or update a large number of orders within a very short time in response to the analysis.

In particular, high frequency algorithmic negotiation can contain elements such as initialization, generation, transmission and execution of the order that are determined by the system without human intervention for each individual

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order or negotiation, a short time for the creation and the liquidation of positions, a high daily portfolio turnover rate, a high intra-day order / transaction ratio and the close of trading day in a flat position, or close to it.

High-frequency algorithmic negotiation is characterized, among other things, by high-level intra-day trades of messages that constitute orders, quotations or cancellations. In determining what constitutes a large intraday of message traffic, account must be taken of the identity of the customer to which the activity ultimately relates, the length of the observation period, the comparison with the overall market activity during that period. period and concentration or relative fragmentation of activity. High frequency algorithmic negotiation is generally used by traders who engage in trading capital and, rather than being a strategy in itself, consists rather in the use of sophisticated technologies to implement more traditional trading strategies, such as trade support activities. (market making) or arbitrage: operate with maket making strategies without having to submit to the stringent constraints imposed on the latter as always present as a counterpart in the market to guarantee liquidity to the participants (liquid markets, as defined at the end of this paragraph) and the possibility of action in a short time to buy financial instruments at the most convenient prices.

The need to create a technological infrastructure capable of guaranteeing traders access to the bargaining price present on each market, at any moment derives from the obligation to execute the bargaining orders to the NBBO (USA) or the Best Price (Europe), in concomitance with the trend towards the fragmentation of the markets in progress in recent years. The order protection rule states that "markets create, maintain and reinforce regulations and procedures reasonably aimed at avoiding trade-throughs the execution of trades at prices worse than protected quotations (NBBO) .Obligation that causes the connection between regulated markets and ECN (or MTF), and above all systems able to analyze the prices and the relative quantities present on every single trading venue (place of bargaining) and then offer the best price to the investor.

Multilateral Trading Facilities MFTs, private trading systems that offer the possibility to trade listed financial instruments on an exchange, without regulatory admission and disclosure tasks; they have the obligation to have specialists required to support the liquidity of trading books. The objective is that of growth on a European scale facilitated by the new regulatory framework more flexible and open, in fact the MiFID directive (this Directive 2014/65/EU) introduces multilateral trading systems or MTFs (Multilateral Trading Facilites), trading circuits managed by individuals who, unlike regulated markets, do not have an exclusive corporate purpose, but can also

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be managed by an investment firm. In its debut, only securities in euros are listed, but in the future securities in other currencies could be introduced, such as the dollar or the pound. ECN Brokers differ from Broker Market Makers because they are not limited to acting as an intermediary between the seller and the buyer but, ensuring the execution of orders create a selfmanaged market, or a market where they are almost always configured as contractual counterparty. Broker Market Maker earnings come essentially from the spread, so these brokers are very critical as they can work very often in situations of conflict of interest. On the contrary, ECN Brokers, acting as real intermediaries, essentially carry out the task of linking two contractual parties against payment of commissions. So by not gaining on spreads and having commissions on each trade, they have no interest in gaining or losing customers and therefore there is no conflict of interest. The main advantages of ECN brokers are: Direct access to the market, Low spreads averaging around 0.5 pips (variation of the spreed in 4 decimal places or even pipettes if the decimal figure is 5 of the sale price of the financial instrument ), Possibility of using different types of trading as expert advisor and scalping (intervene on the analysis of a series of information in a short time), fast orders, Market Depth or the ability to measure the liquidity of the market by viewing all orders placed by customers; main disadvantages: Commissions on each trade, High spread variability, Stop Loss not always present (a price limit that is activated when the financial instrument reaches the limit value to minimize losses), Increased complexity of trading platforms.

High Frequency Trading (Hfts) is a term associated with a wide range of automated operating strategies, often confusing it with the simplest algorithmic trading; high frequency systems, although belonging to the family of algorithmic trading, differ from them, representing a sort of successive evolutionary step. Moreover, Hfts are often programmed to take advantage of the presence on the bargaining books of less advanced and easily predictable algorithmic systems. A Hft system can be described as a completely automated type of trading (of the family of algorithmic trading) able to perform a multitude of calculations in a very short time; has an extremely fast market connection, analyzes tick - by - tick data using technological and IT infrastructures able to perform operations over a period of a few milliseconds. A high frequency system is designed in such a way as to execute its own strategies independently, analyzing the market and transmitting thousands of purchase and sale messages per second and simultaneously entering execution, cancellation or replacement orders that are immediately adapted to the information flow available. The main objective of a high-frequency system is to identify and take advantage of rapid liquidity

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imbalances or very short-term price inefficiencies; usually closes the day of flat bargaining. While forTrading Algorithmico (AT) we mean a trading method whose parameters are determined by a specific set of rules with the aim of automating investment decisions, eliminating the emotional and behavioral component. Trading algorithms typically specify timing, price, quantity and order wheels, monitoring the market conditions continuously. Source: PUORRO, Alfonso. High Frequency Trading: An Overview (High Frequency Trading: An Overview), 2013.

Technical progress has made it possible to negotiate at high frequency and the evolution of business models, negotiation facilitated by the co-location of the plants of the market participants in close physical proximity to the comparison engine of a trading venue; with the intention of guaranteeing orderly and fair trading conditions, the trading venues are obliged to provide co-location services on a non-discriminatory, fair and transparent basis. The use of negotiation technology has increased the speed, capacity and complexity of investor trading arrangements. In general, trading technology has benefited the market and market participants, such as broader market participation, increased liquidity, lower spreads, lower short-term volatility and the means to achieve better order execution for customers; however, it is affected by a series of potential risks, such as an increase in the risk of

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system overload in trading venues due to the large number of orders, the risks that the algorithmic negotiation generates erroneous or double orders or that in any case does not work properly and creates so a messy market.

There is also a risk that algorithmic trading systems will react excessively to market events (events that cause changes in purchase or Stop Loss volumes), thus worsening volatility if a market problem exists; finally, the algorithmic negotiation or the high frequency algorithmic negotiation technique can, like any other form of negotiation, lend itself to certain forms of behavior, if not used correctly, prohibited under Regulation (EU) no. 596/2014 which dictates the provisions against market abuse, for example to avoid risks deriving from regulatory arbitrage and ensure the assumption of responsibility in case of attempted manipulation. High frequency negotiation is a technique that brings advantages in terms of information provided to those who practice it, can induce investors to choose to carry out exchanges in locations where they can avoid contacts with operators who conduct high frequency negotiations, therefore the With the MiFID directive, the Commission deems it appropriate to subject high frequency algorithmic trading techniques that respond to certain characteristics to a special regulatory control, also in the case of techniques based on proprietary trading, regulatory control is also required in cases in which the execution of the technique is structured in such a way as to prevent it being carried out on its own account. With the MiFID directive it is considered as the best way to mitigate these potential risks deriving from a greater use of technology, be it a combination of risk-specific measures and controls for companies that use algorithmic negotiations or adopt high frequency algorithmic negotiation techniques and providing direct electronic access, and other measures directed at the operators of the trading venues to which such firms have access. In order to enhance the resilience of markets to technological developments, the necessary measures and controls will have to follow the technical guidelines adopted by the European Securities and Markets Authority established by Regulation (EU) no. 1095/2010 of the European Parliament and of the Council, ESMA, published in February 2012 and entitled "Systems and controls in an automated trading environment for trading platforms, investment firms and competent authorities" (Systems and controls in an automated trading environment for trading platforms, investment firms and competent authorities - ESMA/2012/122). The Directive establishes for all companies carrying out high-frequency algorithmic negotiations the authorization requirement in the sense of this Directive, authorization to ensure the existence of adequate organizational requirements and adequate supervision. However, institutions that are authorized and controlled under Union law governing the financial sector and

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exempt from the application of this Directive, but which perform algorithmic trading or trading with high frequency algorithmic techniques, are not required to obtain an authorization pursuant to this Directive and are subject exclusively to measures and controls aimed at combating the specific risk arising from these types of trading. In this sense, ESMA plays an important coordinating role by defining the appropriate size of the price deviation so as to ensure the orderly functioning of markets at Union level.

With this directive, it is mandatory for investment firms and trading venues to ensure that robust measures are put in place to ensure that algorithmic or high frequency algorithmic trading techniques do not create a disordered market and not can be used for prohibited purposes. The trading venues are obliged to ensure that their trading systems are resistant and adequately tested to cope with an increase in order flow or in critical market conditions and that at trading venues they are switches to temporarily stop or constrain trades if unexpected price movements occur unexpectedly; the obligation, for the committees' structures, of transparency of fairness, non-discrimination and not to favor anomalous market conditions is also ratified. It is therefore permitted to the trading venues to adjust the commissions related to the canceled orders according to the time frame in which the order has been maintained and to calibrate the commissions according to the financial instrument to which they apply. Furthermore, Member States may authorize trading venues to impose higher fees to execute orders that are subsequently canceled or to impose such fees on participants with a high percentage of canceled orders and those using an algorithmic trading technique high frequency, in order to take into account the additional burden on the capacity of the system without necessarily benefiting other market operators. In addition to measures related to algorithmic trading technique and high frequency algorithmic trading, it is forbidden for investment firms to provide customers with direct electronic access to markets if such access is not subject to adequate systems and controls. Irrespective of the form of direct electronic access provided, companies offering such access shall evaluate and review the suitability of customers using the service in question and shall ensure that risk controls are imposed on the use of the service and must also maintain responsibility for trades transmitted by their clients through the use of their systems or the use of their trading codes. Detailed organization requirements concerning these new forms of negotiation are more specifically prescribed in regulatory technical standards to ensure that requirements can be modified as needed and to take account of further innovations and developments in the sector. The Directive lays down provisions to ensure effective supervision and to allow competent authorities to take appropriate

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and timely measures against defective or incorrect algorithmic strategies, defining the obligation to report all orders generated by algorithmic negotiation in order that the competent authorities can be able to identify and distinguish orders from different algorithms and to reconstruct and effectively evaluate the strategies used by the operators that perform algorithmic negotiations; with this set of rules established by the MiFID directive for the control of algorithmic and high frequency trading, the risk that orders are unequivocally assigned to an algorithmic strategy or to an operator is mitigated. The reporting enables the competent authorities to react efficiently and effectively against algorithmic trading strategies that constitute prohibited behavior or create risks for the proper functioning of the market. In order to ensure the maintenance of market integrity as a result of technological developments in the financial markets, ESMA periodically makes use of national expert contributions on developments in trading technology, including high frequency trading and new sensitive practices. to constitute market abuse, to identify and promote effective strategies for the prevention and treatment of such abuses.

With the amendments made to Directive 2011/61/EU, given the legislative harmonization achieved for the services provided by AIFMs, the regulation that allows the provision of services in other EU Member States other than the Member State of origin, where the AIFM is authorized, it is revised. In the current legal framework, AIFMs authorized to provide such investment services and intend to provide them in Member States other than their home countries are required to comply with additional national obligations, such as the establishment of a separate legal entity. The amendments made by Directive (EU) 2014/65 are intended to eliminate obstacles in the context of cross-border provision of harmonized investment services and to ensure a level playing field between the entities providing the same investment services in compliance with the same requirements of law; an AIFM authorized to provide such services should be able to do so across borders, without prejudice to the appropriate notification requirements, defined in the authorization granted by the competent authorities of the Member State of origin. Article 92 of Directive (EU) 2014/65 makes changes to Article 4 (paragraph 1, point r) and Article 33 of Directive 2011-61-EU by stipulating that an AIFM authorized to provide such services should be able to do it on the level cross-border, subject to the appropriate notification obligations, by virtue of the authorization granted by the competent authorities of the relevant Member State of origin; with Article 94, it repeals Directive 2004/39/EC which lays down the provisions for systems authorized to operate the quality of regulated markets and the provisions that investment firms must comply with

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to be authorized to carry out their business: o more investment services to third parties and in carrying out one or more investment activities on a professional basis: receipt and transmission of orders relating to one or more financial instruments, execution of orders on behalf of clients, trading on own account, portfolio management, consulting in the field of investments, underwriting of financial instruments and placement of financial instruments on the basis of an irrevocable commitment or even without irrevocable commitment, management of multilateral trading systems. Directive 2004/39/EC in turn repeals the Directive of the Council of the European Communities on investment services in the securities sector, Directive 93/22/EEC; a directive which constituted an essential tool for the creation, in the investment firm sector, of the internal market, decided by the Single European Act and programmed in the Commission's White Paper, from the dual point of view of freedom of establishment and freedom to provide services in the field of investment firms, (the first provisions concerning the freedom of establishment date back to 1973 with the enactment of Directive 73/183/EEC). Directive 2004/39/EEC amends Directive 85/611/EEC in which the Commission's objective was to coordinate the national laws governing collective investment undertakings, to bring the conditions of competition between these bodies closer together at Community level and be able to enforce more effective and more uniform protection of the participants; objectives that would have facilitated the marketing of the units of collective investment undertakings located in a member state, in the territory of other Member States of the European Community. Amendment of Directive 93/6/EEC on the capital adequacy of investment firms and credit institutions, amending Directive 2000/12/EC on access to the business of credit institutions and its exercise, which brings together in a consolidated text Council Directive 73/183/EEC of 28 June 1973 on the abolition of restrictions on freedom of establishment and freedom to provide services in the field of self-employed activities of banks and other financial institutions, the first Directive (77/780/EEC) of the Council of 12 December 1977 on the coordination of laws, regulations and administrative provisions concerning access to and the exercise of credit institutions, Council Directive 89/299/EEC of 17 April 1989 concerning the own funds of credit institutions, the Second Council Directive (89/646/EEC) of 15 December 1989 on the coordination of laws, regulations and and administrative provisions concerning access to and the exercise of credit institutions, Council Directive 89/647/EEC of 18 December 1989 on the solvency ratio of credit institutions, Council Directive 92/30 / EEC Council of 6 April 1992 on the supervision on a consolidated basis of credit institutions and finally Council Directive 92/121/EEC of 21 December 1992 on the supervision and control of large exposures of credit

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institutions. The directive (EU) 2014/65 has undergone changes with the enactment of directive (EU) 2016/1034. Changes are also made by Regulation (EU) 909/2014 on the improvement of securities settlement in the European Union and the central securities depositaries of the CSD and amending Directives 98/26/EC (concerning the definitive nature of the regulation in payment systems and securities settlement systems) and Regulation (EU) no. 236/2012, illustrated in the previous paragraphs, paragraph 2.2 ( relating to short selling and certain aspects of derivative contracts concerning the coverage of the risk of default of the issuer "credit default swap" ); the latter introduces into the legislation the references to the same regulation (EU) 909/2014 with regard to CSDs, central securities depositories. Integrations to Directive 2014/65/EU were implemented with the adoption of regulation (EU) 2017/568 with reference to Article 51 paragraph 6, paragraph 3, projects and regulatory standards that ESMA elaborates with reference to which the regulated market must provide to verify that issuers of securities admitted to trading on the regulated market comply with their obligations under Union law with regard to initial disclosure obligations, continuous and ad hoc to facilitate its members and its participants access to information that has been published under the conditions established by Union law. Directive 2014/65/EU is also complemented by the implementation of regulation (EU) 2017/576, as regards the regulatory technical standards for the annual publication by the investment firms of information on the identity of the execution venues and on the quality of the execution.

Further obligations for companies that provide investment services are set out in Regulation (EU) 600/2014 (MiFIR regulation: Markets in Financial Instruments Regulation) adopted by the European Commission due to the weaknesses that the financial crisis between 2006 and 2008 (years in which the crisis produced the greatest effect) highlighted weaknesses in the transparency of financial markets that could have negative socio-economic consequences. The committee believes that greater transparency is one of the shared principles for strengthening the financial system, as confirmed by the declaration of G20 leaders made in London on 2 April 2009. Adopting a new regulatory framework aimed at achieving greater transparency and making operation more effective of the internal market for financial instruments, uniform requirements are defined for the transparency of transactions carried out in the markets of financial instruments; the new regulatory framework defined in Regulation (EU) 600/2014 provides a comprehensive set of rules applicable to a wide range of financial instruments and includes transparency requirements applicable to orders and transactions in shares in accordance with the provisions of Directive 2004/39/ EC of the

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European Parliament and of the Council replaced by the new Directive (EU) 2014/65. The regulation establishes uniform requirements in relation to: a) public disclosure of trading data, b) reporting of transactions to competent authorities, c) negotiation of derivative instruments in organized venues, d) non-discriminatory access to compensation and non-discriminatory access to negotiation of benchmarks, e) powers to intervene on products conferred on the competent authorities, ESMA and EBA as well as powers conferred to ESMA on controls on the management of positions and limitations on positions, f) provision of services or investment activity by companies from third countries, following an applicable equivalence decision by the Commission, with or without a branch. It applies to investment firms authorized under Directive 2014/65/EU and credit institutions authorized under Directive 2013/36/EU of the European Parliament and of the Council when they provide investment services and / or carry out activities; investment companies, as well as market managers, including any trading venue operated by them. The regulation also applies to central counterparties in OTC transactions, in particular Title V applies to all financial counterparties pursuant to Article 2 (8) of Regulation (EU) no. 648/2012 and to all nonfinancial counterparties referred to in Article 10 (1) (b) of that Regulation and Title VI of this Regulation shall also apply to CCPs and to persons holding property rights over reference values.

The rules established by regulation (EU) 600/2014 regarding the transparency of transactions with financial instruments also affect market operators and investment companies that manage their own trading venue; obligations are also established for transactions involving non-equity instruments such as bonds, structured financial instruments (characterized by the combination of a security and one or more derivatives), emission allowances (harmful gases) and derivative instruments (OTC). Provisions are made to allow a third-country enterprise to provide investment services without the need for a branch in the member country. For the purposes of this regulation, liquid markets are defined, and liquidity fragmentation definitions: liquid market: the market of a financial instrument or a category of financial instruments in which there are sellers and buyers ready and available on a continuous basis, and where the market is assessed according to the criteria listed below, taking into account the specific market structures of the particular financial instrument or particular category of financial instruments: i) the frequency and size averages of transactions in a range of market conditions, taking into account the nature and life cycle of products in the financial instrument category, ii) the number and type of market participants, including the relationship between market participants and financial

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instruments traded in relation to a given product; iii) the average size of the spreads, where available; a financial instrument that is traded daily, when it is valued according to the following criteria: i) the free float; ii) the average daily number of transactions relating to these financial instruments; iii) the average daily turnover of these financial instruments.

Liquidity fragmentation: a situation in which: a) the participants in the trading venue are not able to conclude a operation with one or more participants from the same venue because there are no clearing agreements accessible to all participants, or b) a clearing member or its clients are forced to hold their positions in a financial instrument in more than one CCP, which would limit the possibilities for offsetting financial exposures.

Sovereign debt: a debt instrument issued by a sovereign issuer (government bond).

Regulation (EU) 600/2014 is supplemented by Regulation (EU) 2017/583 as regards regulatory technical standards on transparency obligations for trading venues and investment firms in relation to bonds, structured financial instruments, emission allowances and derivatives.

5 - ALTERNATIVE INVESTMENT FUNDS: DIRECTIVE (EU) 2011/61 GEFIA 5.1 - Directive (EU) 2011/61 GEFIA The directive 2011/61/EU which, as we saw in the previous paragraph, was amended by Article 92 of Directive (EU) 2014/65, establishes rules on the authorization, operation and transparency of alternative investment fund managers (GEFIA) which they manage and / or market alternative investment funds (AIFs) in the Union. The Directive aims to create an internal market for AIFMs and a harmonized and rigorous regulatory and supervisory framework for the activities within the Union of all AIFMs, including those having their registered office in a Member State (EU AIFM) and those having their registered office in a third country (non-EU AIFM). As the practical consequences and possible difficulties arising from a harmonized regulatory

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framework and an internal market for non-EU AIFMs carrying out management and / or marketing activities within the Union and for EU AIFMs managing alternative investment funds (FIA) non-EU are uncertain and difficult to predict due to lack of previous experience in this area, the European Commission foresees a review mechanism with Directive 2011/61/EU. The objective pursued, after a transitional period of two years, is that a harmonized passport regime will become applicable to non-EU AIFMs that carry out management and / or marketing activities in the Union and EU AIFMs managing non-EU AIFs afterwards entry into force of a Commission delegated act in this regard. The aim is that the harmonized regime, during a further transitional period of three years, will coexist with the national systems of the Member States in compliance with certain minimum harmonization conditions. After this three-year coexistence period, the objective is to delete the national schemes on the date of entry into force of a further delegated act of the Commission. Objective enshrined with the amendments made by Directive (EU) 2014/65 (Article 92) evaluated in more detail in the precedent paragraph. Directive (EU) 2011/61 applies to AIFMs, without depending on the legal or contractual arrangements on the basis of which the task was assigned to them, which manage all types of funds that do not fall within the scope of the 2009 Directive/65/EC of the European Parliament and of the Council of 13 July 2009 and subsequent amendments referred to in paragraph 3 concerning the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS). It is established that AIFMs can not manage UCITS under Directive 2009/65/EC on the basis of an authorization granted under Directive 2011/61/EU; for a management company authorized under Directive 2009/65/EC applying for an authorization as an AIFM, it is not required by the competent authorities to provide information or documents already provided at the time of application for authorization for the management of UCITS, provided that such information or documents are updated, and investment firms authorized under the 2014/65/EU Directive relating to financial instrument markets, credit institutions authorized under Directive 2013/36/EU on access the activity of credit institutions and its operation, must not obtain an authorization under this Directive in order to provide investment services such as the management of individual portfolios in relation to the AIFs. For investment firms, it is possible to offer, directly or indirectly, units or shares of an AIF to investors in the Union or to place such units or shares with investors in the Union only to the extent that the units or shares can be marketed in accordance with the this Directive. In transposing this Directive into national law, Member States must take into account the regulatory purpose of this provision and should ensure that investment firms

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established in a third country can also provide investment services in accordance with the relevant national law. FIA fall within the scope of this provision. The provision of investment services by such entities, in relation to the FIA, is not intended to constitute a de facto circumvention of this Directive by transforming the AIFM into a phantom company, regardless of whether it is established in the Union or in a third country.

Alternative investment funds, FIAs, are defined as collective investment schemes, including the relevant sub-funds, which: i) collect capital from a number of investors in order to invest them in accordance with a defined investment policy for the benefit of such investors; and ii) do not require an authorization pursuant to Article 5 of Directive 2009/65/EC. The AIF identifies all non-harmonized collective investment funds and therefore do not fall under the provisions of the said Directive for UCITS (Undertakings for collective investment in harmonized transferable securities, therefore regulated at Community level); an AIF may be established under contract law, in the form of a fiduciary shop, by law or may have other legal form and are governed by the legislation of the member country in which they are established unlike the management companies for which harmonized legislation is implemented at the European level, right from the directive 2011/61/EU. AIFMs are defined as legal entities that usually carry out the business of managing one or more AIFs, branches in the case of an AIFM are the place of business that constitutes a part, without legal personality, of an AIFM and provides services for which the AIFM has been authorized. All business locations established in the same Member State by an AIFM with its registered office in another Member State or in a third country shall be considered as a single branch; the commission of management (carried interest) is the portion of the FIA's profits due to the AIFM as compensation for the management of the AIF, excluding any participation in the fund's profits due to the AIFM as a profit on an investment by the AIFM in the FIA. The Directive establishes the obligation for Member States to ensure that each AIF managed under this Directive has a single AIFM which is responsible for compliance with this Directive. The AIFM can be: a) an external manager, which is the legal entity appointed by the AIF or on behalf of the AIF and who is responsible for the management of the AIF (external GEFIA) through this appointment; or b) where the FIA's legal form allows internal management and the board of directors of the fund chooses not to appoint an external AIFM, the FIA itself, which is therefore authorized as an AIFM. An external AIFM, where is unable to ensure compliance with the requirements of this Directive for which the AIF or another entity is responsible for it, shall immediately inform the competent authorities of its

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home Member State and, where appropriate, the competent authorities of the EU FIA concerned. The competent authorities of the AIFM's home Member State require the AIFM to remedy the situation. If, despite the adoption of the measures, the non-compliance persists, and to the extent that it concerns an EU AIFF or an EU AIF, the competent authorities of the AIFM's home Member State require the resignation of this as an AIF manager . In this case, the AIF can no longer be marketed in the Union. In the case of a non-EU AIFM operating a non-EU AIF, this fund can no longer be marketed in the Union and the competent authorities of the reference Member State (where the AIFM is not authorized for the management of EU AIFs and not EU in compliance with Directive 2011/61/EU) of the AIFMIA immediately inform the competent authorities of the AIFM host Member State of the change.

A number of provisions of this Directive require AIFMs to ensure compliance with obligations for which, in some fund structures, the manager is not responsible. Examples are the structures of the funds in which the responsibility of appointing the depositary lies with the FIA or another person acting on behalf of the fund itself. In this case the AIFM has no definitive control over the effective appointment of the depositary, unless the fund is internally managed by the latter; Directive 2011/61/EU does not regulate the AIFs, it can not impose on the funds the obligation to appoint a depositary. It is the obligation for AIFMs to ensure compliance with current obligations that fall on a fund or another entity on its behalf and in the event of a breach of these obligations it is mandatory for the competent authorities to request the AIFM from adoption of measures necessary to remedy the situation and if, despite these measures, non-compliance persists and whether an EU AIFM or an authorized non-EU AIFM manages a Union AIF, they must renounce the management of the fund; if they do not renounce, the competent authorities of their home Member State must impose the waiver by prohibiting the marketing of the AIF in the Union. The same prohibition is applied to the authorized non-EU AIFM which markets an alternative investment fund outside the European Union in the Union. Directive 2011/61/EU also provides for a facilitated scheme (waivers) for AIFMs in the event that the cumulative AIFs managed do not exceed the threshold of EUR 100 000 000 or EUR 500 000 000 for AIFMs managing only funds that they do not use leverage and do not grant investors repayment rights for a period of five years. Although the activities of the AIFMs in question are unlikely to have significant individual consequences for financial stability, it could happen that, jointly, these activities generate systemic risks. As a consequence, these AIFMs should be subject not only to the full authorization but to the registration requirement in their Member State of origin and to provide competent authorities with

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relevant information on the main instruments they trade and on the main exposures and more important concentrations of the AIFs they manage. The derogations provided for by the Directive, however, provide that smaller AIFMs are treated as AIFMs subject to the accession procedure provided for in the Directive itself and any exemption should not prevent Member States from imposing more stringent obligations on AIFMs that have not joined; in particular, Member States shall ensure that AIFMs that benefit from derogations, at least: (a) are subject to registration with the competent authorities of their home Member State; (b) identify themselves and the AIFs they manage with the competent authorities of their Member State of origin at the time of registration, (c) provide information on the investment strategies of the AIFs that they manage to the competent authorities of their home Member State when registering; (d) provide periodically to the competent authorities of their Member State source information on the main instruments in which they trade and on the main exposures and major concentrations of the AIFs they manage in order to allow the competent authorities to effectively monitor the systemic risk, and e) notify the competent authorities of their home Member State of the fact no longer to meet the derogation conditions. AIFMs benefiting from the said facilitations may not avail themselves of any of the rights granted under this Directive, unless they choose to submit to the rules of this Directive. Where an AIFM makes this choice, this Directive becomes fully applicable.

It is established that the management of FIA must consist in providing at least investment management services. The individual AIFM to be appointed under this Directive may not be authorized to provide a portfolio management service without providing a risk management service or vice versa, and the exercise of administrative and administrative functions must not be precluded marketing of an AIF, or functions related to the activities of the FIA. An external GEFIA may also provide investment portfolios management services, with mandates given by investors on a discretionary and individual basis, including portfolios owned by pension funds and institutions for occupational retirement provision covered by Directive 2003/41/EC (repealed from Directive 2016/2341/EU), concerning the activities and supervision of institutions for occupational retirement provision, or the provision of advisory services relating to the investment, custody and administration of units in collective investment schemes and the receipt and transmission of orders . In accordance with the authorization set out in Directive 2009/65/EC and subsequent amendments (Directive 2014/91/EU), the management of UCITS is permitted to an external AIFM.

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The directive establishes robust governance control systems for AIFMs by defining provisions to minimize conflicts of interest; establishes organizational requirements without prejudice to the regimes and controls provided for under national law concerning the registration of persons working for or for an AIFM. The activities managed by an AIFM are listed below: 1. Minimum investment management functions that an AIFM performs in the management of an AIF: a) portfolio management; b) risk management.

2. Other additional functions that an AIFM may perform during the collective management of an AIF: a) administration: i) legal and accounting services relating to the management of the fund; ii) information service for customers; iii) evaluation and determination of the price, also for the purposes of tax declarations; iv) verification of compliance with applicable legislation; v) keeping the register of the holders of shares / shares; vi) distribution of proceeds; vii) issue and redemption of units / shares; viii) settlement of contracts, including sending certificates; ix) keeping of accounting records; b) marketing; c) activities related to the assets of the AIFs, notably the services necessary to meet the fiduciary obligations of the AIFM, the management of the structures, activities of administration of real estate, advice to companies on the capital structure, the industrial strategy and related matters, consultancy and services related to mergers and acquisitions of companies and other services related to the management of the AIF and to the companies and other assets in which it has invested. Some of the activities listed above may be delegated and the relevant directive establishes strict constraints and requirements and the delegation of auxiliary tasks, such as for example the administrative or technical tasks performed by the AIFM in the context of its management tasks, should not be subject to the specific constraints and requirements set out in this Directive.

Recent developments in the market for alternative investment funds underline the important need to separate the safekeeping of assets from management functions and to distinguish the assets of investors from that of the manager; the directive establishes the obligation to appoint a depositary other than the AIFM appointed to perform the depositary functions with respect to AIFs. The commission establishes provisions concerning the designation and functions of a depositary to be applied to all AIFs managed by an AIFM subject to this Directive and, therefore, to all the business models of the AIFs. For AIFs that do not provide for the possibility of exercising the right of redemption in the five years following the date of initial investments and which, according to their fundamental investment policy, do not normally invest in assets that must be held in custody in accordance with this Directive

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o generally invest in issuers or unlisted companies with the potential to gain control over such companies under this directive, such as investment funds in private capital, venture capital funds and real estate funds , Member States may allow the appointment of a notary, a lawyer, a conservative or another person acting as depositary. In such cases the depositary functions fall within the framework of professional or commercial activities for which the appointed person is bound to the obligation of professional registration recognized by law or laws or regulations or ethical standards and can offer sufficient financial and professional guarantees to enable him / her to effectively exercise the relevant depositary functions of the fund and honor the commitments inherent to these functions, provisions established by Directive 2011/61 / EU to take into account existing practices for certain types of closed-end funds. For all other AIFs, the depositary should be a credit institution, an investment firm or another entity admitted in accordance with Directive 2009/65 / EC, given the importance of the custody function. For non-EU AIFs, the depositary should be able to be a credit institution or any other entity subject to effective prudential regulation and supervision, having an effect similar to that of Union law and effectively applied. The depositary where to have the registered office or a branch in the same country of the FIA. For a non-EU AIF it is possible to have a depositary established in the third country in question only if certain additional conditions are met. On the basis of the criteria established in delegated acts, the Commission has the power to adopt implementing measures, stating that the prudential regulation and supervision of a third country have the same effects as EU law and are effectively applied. Furthermore, where the competent authorities disagree on the correct application of the other additional conditions, the mediation procedure provided for in Article 19 of Regulation (EU) No 1095/2010 (establishing ESMA). Alternatively, for non-EU AIFs, the depositary has the possibility of establishment in the Member State of origin or in the reference Member State of the AIFM which manages the AIF. The depositary is responsible for the appropriate monitoring of the FIA's cash flows, ensuring in particular that the money and cash of investors belonging to the AIF, or the AIFM acting on behalf of the fund, are correctly registered on accounts held by the AIF or the AIFM which acts on behalf of the fund or the depositary acting on behalf of the AIF for custody of assets of the AIF including the custody of financial instruments that may be recorded in an account of financial instruments opened in the accounting records of the depositary and all instruments financial statements that can be physically delivered to the latter, as well as for the verification of ownership of all other assets held by the FIA or the AIFM on behalf of the fund itself. When ensuring

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that investor money is correctly recorded in a liquidity account, the depositary should take into account the provisions set out in Article 13 (7) and (8) of Directive 2004/39/EC for the protection of the assets of the customers; the aforementioned paragraphs establish that an investment company and therefore in this case the depositary (which may also be an investment company) when holding financial instruments belonging to the clients, take appropriate measures to safeguard the property rights of the latter, in particular in the case of insolvency of the investment firm, and to prevent customers' tools from being used by the investment company on their own behalf, unless the customer explicitly approves them; when they hold funds belonging to clients, investment firms take appropriate measures to safeguard their rights and to prevent clients' funds from being used by their own companies, except in the case of credit institutions (bank). Directive 2004/39/EC was repealed by Directive 2014/65/EU (Article 94 thereof) which in turn is amended by Directive 2016/1034/EU. The European Commission with Directive 2011/61/EU takes into account the fact that numerous FIAs, in particular hedge funds, are currently using a main broker (prime broker) and ensure that the AIFs continue to make use of the services of the main intermediaries; furthermore, it establishes that unless there is a functional and hierarchical separation between the exercise of the depositary functions and the principal intermediary functions and that potential conflicts of interest have not been appropriately identified, managed and communicated to the FIA's investors, a principal intermediary can not being appointed as depositary, since the principal intermediaries act as counterparties to the AIFs and can not therefore act simultaneously in the best interest of the fund as required by the depositary. Depositaries may delegate custody duties to one or more major intermediaries or other third parties; in addition to the delegated custody functions, the main intermediaries may be authorized to provide the FIA with principal brokerage services that do not form part of the delegation agreements. The depositary remains responsible for any losses incurred by the AIFM, the FIA and investors; the loss of financial instruments held in custody with other types of loss is distinguished. In the event of a loss other than that of financial instruments in custody, the depositary is liable in the event of fraud or negligence. If the depositary holds assets in custody and these assets are lost, the depositary is liable, unless it is able to demonstrate that such loss is related to an external event outside of any reasonable control, the consequences of which would have been inevitable despite all reasonable effort to avoid them. In this context, a depositary should not, for example, be able to invoke internal situations as a fraudulent act committed by an employee to exempt himself from his responsibilities. The depositary is held liable in the event of the loss of financial instruments whose custody has

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been delegated to third parties. However, as long as the depositary is expressly authorized to exempt itself from its responsibilities subject to the contractual transfer of such responsibilities to the third parties in question, on the basis of a written contract between the depositary and the AIF or the AIFM acting on behalf of the FIA, in which this exemption is objectively justified, and provided that the third parties in question can actually be held liable for loss under a contract between the depositary and such third parties, the depositary may exonerate from its responsibilities if it is able to demonstrate that it acted with the competence , the care and diligence due and having satisfied the specific provisions for the delegation. Prescribing the need for contractual transfer of liability to third parties, Directive 2011/61/EU intends to attribute external effects to this contract, making third parties directly responsible to the AIF or investors of this fund for the loss of financial instruments held in custody. Furthermore, where the legislation of a third country requires that certain financial instruments be held by a local entity and where there are no local entities meeting all the requirements for delegation by the depositary, the depositary may exonerate from its responsibility provided that the regulation or documents of the FIA concerned expressly provide for such exemption; Investors must have been duly informed of such waiver and of the circumstances justifying it prior to making the investment, furthermore the AIF or AIFM on behalf of the AIF must instruct the depositary to delegate the custody of such financial instruments to a local entity . Between the depositary and the FIA or the manager acting on behalf of the FIA there must be a written contract expressly authorizing such exemption, and there must be a written contract between the depositary and the third parties expressly transferring to the latter the responsibility of the depositary and allowing the FIA or, to the manager on behalf of the FIA, to claim compensation from third parties for the loss of financial instruments or allow the depositary to submit such a request on their behalf.

Directive 2011/61/EU defines transparency obligations by establishing for an AIFM to publish, for each EU AIF that it manages and for each AIF it markets in the Union, an annual report for each financial year within six months of the end of the financial year, in to this Directive. This six-month period should be without prejudice to the right of Member States to impose a shorter deadline.

As it is possible for an AIFM to sell or buy financial instruments for an amount exceeding the capital held, then to resort to leverage and, in certain circumstances, to contribute to increasing systemic risks or disorder on the markets, specific obligations must be imposed on AIFMs that they use leverage. The information needed to identify, monitor and respond to these risks has not been uniformly collected across the Union and exchanged

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between Member States so as to identify potential sources of risks to the stability of the financial markets in the Union. To remedy this situation, specific requirements are applied to AIFMs that make substantial recourse to leverage at the AIF level. These AIFMs are required to disclose information relating to the general level of leverage used, leverage arising from the loan of cash or securities and the leverage arising from a position held in derivatives, from the reuse of assets and from the main sources of leverage in their FIA. The information collected by the competent authorities should be shared with other authorities in the Union, with ESMA and with the European Systemic Risk Board (CESR) established by Regulation (EU) no. 1092/2010 of the European Parliament and of the Council of 24 November 2010 on the macroprudential oversight of the financial system in the European Union and establishing the European Systemic Risk Board, so as to promote a collective analysis of the impact of leverage financial management of the AIFs managed by the AIFMs on the Union's financial system, as well as a common response. In the event that one or more AIFs managed by an AIFM are potentially an important source of counterparty risk for a credit institution or other systemically important institutions in other Member States, this information must also be shared with the competent authorities. To ensure an adequate assessment of the risks represented by the leverage by an AIFM in relation to the AIFs it manages, the AIFM is obliged to demonstrate that the limits of leverage for each AIF managed are reasonable and to comply with these limits at any time. When the stability and integrity of the financial system is threatened, the competent authorities of the AIFM's home Member State are obliged to impose limits on the level of leverage an AIFM can use in the AIFs it manages. ESMA and CESR must be informed of any action taken in this regard. The directive allows the ESMA, taking into account the advice of the ESRB, to determine whether the leverage used by an AIFM or a group of AIFMs poses a substantial risk to the stability and integrity of the financial system and to direct competent authorities an opinion specifying the corrective measures to be taken. The Commission considers it necessary to ensure that the competent authorities of the AIFM's home Member State, the companies on which the AIFs exercise control, and the staff of those companies receive certain information necessary for such companies to assess the manner in which such control will affect their situation.

For AIFM, managers of FIAs who control an issuer whose shares are admitted to trading on a regulated market, the information is generally provided in accordance with Directive 2004/25/EC on bids for public purchase, and of the Directive 2014/109/EC on the harmonization of transparency obligations concerning information on issuers whose securities

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are admitted to trading on a regulated market. For FIA managers exercising control over unlisted companies, specific obligations must be applied to ensure transparency in relation to the subsidiary, applying stricter transparency, disclosure and information requirements. The European Commission believes that the annual reports of the relevant AIF are complemented by specific information about the subsidiary or that this additional information is included in the annual report of the subsidiaries. This information is made available to the employees' representatives of the company or, failing these, to the workers themselves, as well as to the investors of the AIF concerned. Specific information requirements for workers of certain companies apply in cases where the AIFs acquire control over companies within the meaning of this Directive. However, in most cases, the AIFM has no control over the AIF unless it is an internally managed AIF. Furthermore, according to the general principles of company law, there is no direct relationship between the shareholders and the employees' representatives or, in the absence of these, the workers themselves. For these reasons, a shareholder or his manager, ie the AIF and the AIFM, may not be required to inform workers' representatives, or, failing that, to the workers themselves in accordance with this Directive. As regards the obligations to inform those workers' representatives, or, failing that, to the workers themselves, this Directive should provide the AIFM concerned with the obligation to do their best to ensure that the company's board of directors concerned, they make the relevant information public to the representatives of the employees of the company or, failing these, to the workers themselves.

If an AIFM operates one or more AIFs that gain control of an unlisted company, that AIFM is obliged to provide the competent authorities of its home Member State with information on the financing of the acquisition. This obligation to provide information on financing also applies in the event that an AIFM manages AIFs that acquire control over an issuer of shares admitted to trading on a regulated market.

When an AIFM operates one or more AIFs that gain control over an unlisted company or an issuer, for a period of twenty-four months from the acquisition of control over the company by the AIFs, the AIFM is not authorized to facilitate, support or order any distribution, reduction of capital, redemption of shares and / or purchase of treasury shares by the company in accordance with this Directive; to the extent that it is authorized to vote on behalf of the AIFs in the management bodies of the company, it may not vote in favor of a distribution, a reduction in capital, a redemption of shares and / or a purchase of treasury shares by the company in accordance with the this Directive and must in any case carry out everything in its power to prevent distributions,

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reductions in capital, redemptions of shares and / or purchases of treasury shares by the company in accordance with this Directive. Upon receipt of this Directive under national law, Member States are obliged to give due importance to the need for a level playing field between EU and non-EU AIFs when they acquire control of companies established in the Union.

Notification and advertising obligations and specific guarantees against asset unbundling, in the case of control of an unlisted company or an issuer, are subject to a general exception with regard to control over small and medium companies and vehicle companies for the acquisition, holding or administration of real estate. These obligations are not intended to disclose proprietary information that would disadvantage the manager to potential competitors, such as sovereign wealth funds or competitors who may wish to expel the target company using the above information to their advantage (for example, confidential management information that if public can jeopardize the feasibility of the company's entrepreneurial intend). The obligations to notify and publish the information must therefore be applied subject to the conditions and restrictions relating to confidential information established by Directive 2002/14/EC, which establishes a general framework for informing and consulting employees, and without prejudice of the directives 2004/25/CE and 2004/109/CE. Therefore, Member States shall ensure that, within the limits and under the conditions established by national law, workers' representatives and any person assisting them are not authorized to disclose to employees or third parties information that affects the legitimate interests of the company and that they are have been expressly provided to them on a confidential basis. However, Member States have the possibility to authorize workers' representatives and anyone who can assist them to transmit confidential information to workers or third parties who are bound by the obligation of confidentiality; shall ensure that the affected AIFMs do not require disclosure of information by the Management Board to the employees' representatives or, failing that, to the workers themselves, when the nature of the information in question is likely to seriously harm, according to criteria objective, to the operation of the company concerned or to cause it injury.

Notification and publicity obligations and specific safeguards against asset unbundling are without prejudice to any stricter rules adopted by the Member States.

Chapter II of the directive defines provisions related to the conditions for access to the activities of AIFM, in Chapter III the operating conditions including the general principles, the provisions for the delegation of functions, provisions regarding the depositary; in chapter IV the obligations of transparency are defined, in the Chapter V provisions concerning AIFMs that

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manage specific alternative investment funds as excessive financial leverage, obligations imposed on the AIFMs that manage the AIFs that acquire control of unlisted companies and issuers are established . Chapter VI of the directive establishes the right for AIFMs to market and manage EU AIFs in the union; in Chapter VII, conditions are defined for EU AIFMs managing nonEU AIFs that are not marketed in the Member States and for the authorization of non-EU AIFMs that want to manage AIFs in the European Union; there are conditions for derogation of certain provisions for non-EU AIFMs seeking authorization in a reference Member State in cases where it is not possible to reconcile them with provisions of the third state to which it is subject or these are equivalent to the provisions of Directive 2011/61/EU, therefore with the same regulatory purpose and which offer the same level of protection for investors. Provisions are made for Member States in Chapter VIII to enable AIFMs to market for AIFs in the retail investors in their territory shares or AIFs that they manage under this Directive, regardless of whether such AIFs are marketed on a national or transnational basis or are EU or non-EU FIAs; in the latter two chapter, provisions are made on the competent authorities (designations, powers and appeals) and the transitional and final provisions of the Directive.

With Directive 2011/61/EU as seen in the previous paragraph, Directive 2009/65/EC (UCITS IV) is amended, Directive 2003/41/EC on the activities and supervision of institutions for occupational retirement provision is amended, is amended the Regulation (EC) 1060/2009 on credit rating agencies, ECAI agencies encountered in studies related to regulation (EU) 573/2013 (7°) with reference to the assessment of the risk assumed by 'public interest entities' (credit institutions, financial institutions) for the determination of regulatory capital. The regulation (EU) no. 1095/2010 is also amended, the regulation establishing the ESMA (European Securities and Markets Authority) and repealing the Decision 2009/77/EC, being defined in the same regulation that ESMA assumes all the current tasks and powers of the Committee of European Securities Regulators CEBS, authority established by its own committee by Decision 2009/77/EC and then repealed by Regulation 1095/2010 which also amends decision no. 716/2009/EC of the Commission with regard to the removal of CEBS from the beneficiaries of grants awarded by the Commission on the Community program established by the same decision to support specific activities in the field of financial services, financial reporting and audit.

(7°) NOTE: a rating agency or rating agency is a company that assigns a judgment or evaluation (rating) to the soundness and solvency of a company issuing securities on the financial market. The "ratings" constitute votes on a

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predetermined scale, generally expressed in terms of letters and / or other symbols. There are many existing rating agencies, but the most important, influential ones are Standard & Poor's, Moody's Investor Service and Fitch Ratings, all three companies owned by large multinationals. The latter have the role of helping to deal with the problems of information asymmetry on the market in order to increase its efficiency at a global level by providing useful investment information. Investors operating in the markets rely on ratings issued by rating agencies to decide which securities to buy and to what extent, depending on the risk predisposition of investors. The supervision of rating agencies is entrusted to the competent authority of the home Member State (for example, in Italy Consob, SEC for the United States), in cooperation with the competent authorities of the other Member States concerned, availing itself of the competent college and appropriately involving the European Securities and Markets Authority (ESMA). In July 2011, at the beginning of the sovereign debt crisis (started in 2010 after the great recession in previous years, Consob called the representatives of the rating agencies Standard & Poor's Italia and Moody's Italia to ask for clarifications on a report released by the agencies the previous year on the corrective maneuver launched by the government of Silvio Berlusconi, (towards a downgrading of the Italian Banks).

5.2 - Credit Rating: Regulation (EC) 1060/2009 The ratings of credit rating agencies are used in the in securities markets and banking markets by investors, borrowers, issuers and governments as elements that contribute to the formation of informed decisions on investment and financing. Another important role is the possibility of using ratings as a reference for calculating capital requirements for solvency or for calculating risks in investment activities for credit institutions, investment firms, life and non-life insurance companies, reinsurance undertakings, undertakings for collective investment in transferable securities (UCITS), for FIA alternative investment funds and institutions for occupational retirement provision. The obvious consequence is that credit ratings have a significant impact on the functioning of the market and on investor and consumer confidence. It is therefore essential that credit rating activities are conducted in compliance with the principles of integrity, transparency, accountability and management correctness, so that the ratings used in the Community issued by these agencies are independent, objective and of adequate quality. A major

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problem in the market is that most credit rating agencies are located outside the European Community, and most of the Member States do not regulate the activities of credit rating agencies, even for the terms of issuance, of ratings. Although of considerable importance for the functioning of the financial markets, credit rating agencies are regulated by Community legislation only in limited areas, in particular Directive 2003/6/EC of the European Parliament and of the Council of 28 January 2003 on abuse of insider information and market manipulation (market abuse), directive repealed by Regulation (EU) 596/2014. Further reference to credit rating agencies can be found in Directive 2006/48/EC of the European Parliament and of the Council of 14 June 2006 on access to and the exercise of credit institutions and in Directive 2006/49/EC of the European Parliament and of the Council of 14 June 2006 on the capital adequacy of investment firms and credit institutions; both directives are repealed by Directive 2013/36/EU. References to credit rating agencies are also present in the Regulation (EU) 575/2013 on prudential requirements for credit institutions and investment firms. From the above studies, the Commission considered it important to lay down rules ensuring for all credit ratings issued by credit rating agencies registered in the Community, appropriate quality and issued by credit rating agencies subject to strict requirements. After a continuous collaboration with international partners, the Commission intervenes and will intervene to ensure the convergence of the rules that apply to credit rating agencies, convergence aimed at harmonizing legislation and therefore to common regulatory standards at Community level and also compliant at international level. By Regulation (EC) 1060/2009 it is considered appropriate to exempt certain central banks issuing credit ratings, provided they meet all the applicable conditions on the matter which guarantee the independence and integrity of their credit rating activities and which are just as stringent as the requirements of this regulation.

The European Commission with Regulation (EC) 1060/2009 on credit rating agencies introduces a common regulatory approach to improve the integrity, transparency, accountability, good governance and reliability of credit rating activities , contributing to the quality of ratings issued in the Community and thus to the smooth functioning of the internal market while achieving a high level of investor protection. It establishes the conditions for issuing ratings and set provisions on the organization and performance of credit rating agencies to promote their independence and the prevention of conflicts of interest. As a general opinion that credit rating agencies have not been able, in the first place, to promptly adjust their ratings to the worsening market conditions and, secondly, to adapt their credit ratings in good time following

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the worsening of the market crisis after 2006, the committee believes that taking measures on conflicts of interest, quality of ratings, transparency and internal governance of credit rating agencies, and monitoring of the activities of credit rating agencies, results in best way to remedy the inability shown by the agencies in the crisis. Those who use credit ratings should not rely blindly on these assessments but should always proceed with the utmost attention to their own analysis and due diligence due before relying on such ratings, which implies the availability by the agencies of all information regarding the assessments to allow users all the checks deemed necessary for the assessment of the reliability and quality of the ratings; therefore the commission with regulation 1060/2009 establishes the obligation for agencies to provide such information. It establishes a framework of common rules concerning the improvement of the quality of ratings, with particular reference to the quality of credit ratings used by financial institutions and persons regulated by harmonization rules in the Community, because in the absence there is a risk that Member States will adopt divergent measures at national level, divergences which would have a direct negative impact on the internal market and would create obstacles to its proper functioning, as the rating agencies would be subject to different rules in the individual Member States.

These differences in rating quality would result in different levels of investor and consumer protection; it is also necessary for users to compare ratings issued in the Community with ratings issued internationally.

The possibility of using the ratings issued by agencies in third countries within the Community established by Regulation 1060/2009, only if they comply with equally stringent requirements as those established by the same regulation, introduces an endorsement system that allows the rating agencies of the credit established in the Community and registered in accordance with its provisions to endorse credit ratings issued in third countries. It is mandatory for an agency within the community when he committed with endorsement a rating issued in a third country, to determine and control on an ongoing basis whether the rating activity aimed at issuing said ratings meets the requirements for the issue of ratings of credit and which are just as stringent as those of the same regulation and are suitable for achieving the same objective and the same practical effects.

Considering that the establishment outside the Community could constitute a serious impediment to effective supervision in the interest of the Community's financial markets, an endorsement system is introduced for credit rating agencies which are affiliated or work in close cooperation with credit rating agencies based in the Community; therefore, the rating is guaranteed by an agency registered in the European Union which is usually a branch of the

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non-EU agency or cooperates for the ratings for which endorsement is necessary. The need to adapt in some cases the requirement of physical presence in the Community is foreseen, with particular reference to the smaller credit rating agencies of third countries which are not present, nor are they affiliated in the Community. A certification system is established for these agencies, provided that they are not systemically relevant for the financial stability or the integrity of the financial markets of one or more Member States, hence smaller agencies. Certification is possible after the Commission has established the equivalence of a third country legal and supervisory framework with the requirements of Regulation (EC) 1060/2009.

The intended equivalence mechanism does not provide automatic access to the Community, but allows eligible credit rating agencies to be assessed on a case-by-case basis and to obtain exemption from some of the organizational requirements applicable to credit rating agencies operating in the Community, including the requirement for physical presence in the Community. Third country rating agencies are required to comply with the criteria considered as general requirements for the integrity of credit rating activities, with the aim of preventing interference with the content of credit ratings by the competent authorities and other public authorities this third country and provide for an appropriate policy on conflicts of interest, as well as the rotation of rating analysts and periodic and continuous communication. The committee with the regulation provides for the possibility of stable cooperation agreements between the competent authorities of the home Member States and the corresponding competent authorities of third countries in which credit rating agencies are based; furthermore, it establishes that a credit rating agency that endorses credit ratings issued in a third country must be fully and unconditionally responsible for these endorsed credit ratings and for compliance with the related conditions defined in the same regulation.

Derogation to the regulation is defined for the ratings produced by a credit rating agency following a single order and provided exclusively to the person who commissioned them and which are not intended for public disclosure or distribution by subscription; furthermore, it establishes that investment research and recommendations and any other opinions regarding the value or price of a financial instrument or a financial obligation should not be considered credit ratings. An unsolicited credit rating, ie a credit rating not initiated at the request of the issuer or the rated entity, must be clearly identified as such and where it can be distinguished by appropriate means from the requested credit ratings. Credit rating agencies focus their professional activity on rating issues to avoid potential conflicts of interest. It is not advisable for a credit rating agency to provide advisory services, and in

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particular to make proposals or recommendations regarding the design of a structured financial instrument, it may lend ancillary services when the benefits do not create potential conflicts of interest with the issue of credit ratings; must use rigorous, systematic, continuous and validated rating methodologies based on relevant historical experience and backtesting, which is not a requirement for interference with the content of ratings and methodologies to be used from part of the competent authorities and of the Member States. The regulation provides for the requirement of at least annual review of the ratings by credit rating agencies, a requirement which must not prejudice their obligation to monitor ratings on an ongoing basis and to revise them where necessary. These requirements should not be applied in a way that prevents new credit rating agencies from entering the market. Credit ratings must have solid and motivated foundations in order to avoid compromise solutions.

The commission with Regulation (EC) 1060/2009 establishes the obligation for credit rating agencies established in the Member States to disclose information on the methodologies, models and main rating assumptions used in their rating activities. The degree of detail of the information to be made public regarding the models should be such as to provide the users of the ratings with information to enable them to use due diligence in assessing whether or not to rely on such ratings. The information to be made public regarding the models should not constitute sensitive commercial information or seriously impede innovation; they must take measures to ensure that the information used for the purpose of assigning a credit rating is reliable. To this end, an agency must include, inter alia, the assignment to independent audited financial statements and communications to the public, checks by reputable service providers, random sample checks of the information received, or contractual provisions which clearly establish the liability of the rated entity or of related third parties if the information provided under the contract is notoriously materially false or misleading or if the rated entity or third parties related to it have not conducted, as required by the contract, a adequate supervision of the accuracy of the information. The credit rating agency in issuing the credit ratings will have to report appropriately any risk, including a sensitivity analysis for the relevant assumptions used, explaining how the various market developments that move the parameters integrated into the model (to volatility) may influence rating changes. It should ensure that information on the historical default rates associated with its rating categories is verifiable and quantifiable and provides a sufficient basis for the relevant parties to understand the historical returns associated with each rating category, and whether and how the rating categories are changed. If

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the nature of the rating or other circumstances result in a historical default rate that is not appropriate or statistically valid or may otherwise mislead the users of the credit rating, the credit rating agency must provide appropriate clarifications. This information should be as comparable as possible to existing models in the sector, so as to help investors compare the results of the various credit rating agencies.

The same agencies are required to take measures to avoid situations in which issuers request a preliminary credit rating of the structured financial instrument in question simultaneously with several credit rating agencies in order to identify the one offering the best rating for the credit rating proposed instrument; issuers should also avoid using such practices. With Regulation 1060/2009, the Commission establishes that the established procedure for the recognition of external credit assessment agencies (ECAIs) should not be replaced, pursuant to Directive 2006/48/EC (on access to credit institutions and its exercise, recast of Directive 2000/12/EC and subsequent amendments, subsequently repealed by Directive 2013/36/EU). It is anyway mandatory for ECAIs already recognized in the Community to apply for registration under this Regulation. A credit rating agency registered by the competent authority of the Member State concerned is authorized to issue credit ratings throughout the Community. For this purpose, a single registration procedure is envisaged for each credit rating agency which produces effects throughout the Community. The registration of a credit rating agency should take effect following the entry into force of the registration decision taken by the competent authority of the home Member State in the relevant national legislation.

The Commission shall present a report to the European Parliament and the Council assessing the incentives for issuers to use credit rating agencies established in the Community for part of their ratings, possible alternatives to the "issuer pays" model, including the creation of a public credit rating agency, and the convergence of national rules in case of violation of the provisions of this regulation. Based on this assessment, the Commission should make appropriate legislative proposals.

Regulation (EC) number 1060/2009 in Annex I sets out the provisions on independence and prevention of conflicts of interest by defining the organizational requirements in section A of the annex, the operational requirements in section B, the provisions concerning rating analysts and other persons directly participating in the credit rating activities in Section C, the provisions on the presentation of credit ratings in section D and the information making available including those regarding any actual and

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potential conflicts of interest. From the research conducted in this study with reference to the conflicts of interest that affect the credit rating agencies we have found non-negligible opinions that would confirm the existence of conflicts of interests with the shareholders.

Below is an extract of the information collected on the agencies credit rating for possible conflicts of interest in their exercise; ... in the US financial crisis from subprime mortgages in 2008, it highlighted the problems associated with Rating Agencies, both in terms of incentives and in the performance of their business. In Italy in 2012 and in the context of the great recession, an investigation was initiated by the Public Prosecutor of Trani to assess the reliability and objectivity of ratings by rating agencies under the assumption of a crime of enforcement, (disruption and market manipulation and abuse of privileged information). In particular, among the first conclusions of the investigation, the American Standard & Poor's agency, in relation to the downgrading of Italian banks, is contested for having put in place "a series of devices which are concretely capable of causing a destabilization of the image, prestige and Italy's credit on the financial markets "also due to" incompetent" (unidentified) and inexperienced "analysts" by means of communications to the markets made "in a selective and targeted manner in relation to the moment of greater criticality of the Italian political and economic situation causing the Republic Italian patrimonial damage of considerable gravity "...

Below are some published editorial information: ... The rating lords who downgrade nations. With their votes they have knocked out Greece and the Spain. Who are they and how they work the agencies that draw the report cards of the Nations. ... ... NEW YORK - The address is 250 Greenwich Street a few steps from Ground Zero. Here on the twentieth floor of the Moody's skyscraper, the visitor is greeted by a golden plaque: "Credit: the trust of man in man". Arturo Cifuentes, former manager of Moody's, thinks otherwise. Today it defines "a shame the way in which rating agencies set their report cards on credit, solvency ratings". Eric Kolchinsky, also a repentant manager of Moody's, pronounces the word "fraud". Frank Raiter, who worked for Standard & Poor's, talks about "oligopoly accumulating profits thanks to the role of referees". E-mails in Standard & Poor's describe the relationship between this agency and Goldman Sachs as "the Stockholm syndrome". ...

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To allow an objective assessment of the problems inherent in the conflict of interest and with reference to the international credit rating agency among the best known worldwide, the Standard & Poor's, we consider appropriate to report some comments by Maria Pierdicchi, is Head of Southern Europe by Standard & Poor's: ... it is important to underline that Standard & Poor's has no privileged information on the strategies or shareholdings of the shareholders of McGraw Hill, our parent company. being a publicly traded company, McGraw Hill has some of the largest international funds among its shareholders, investing in thousands of stocks worldwide. The holding they hold in McGraw Hill is not, as a rule, a small percentage of their global portfolio. For its part, S & P publishes ratings on more than one million debt securities, has no information on which companies; make up the portfolio of these investors. More importantly, institutional investors, including those holding shares in McGrawHill, have neither the opportunity nor the ability to influence our rating decisions and do not have access to relevant information to analysis or unpublished rating opinions. To them we reserve the same treatment applied to any external user of our ratings. ...

In addition to the measures adopted in compliance with European regulations, S & P has long-established procedures to protect the integrity and independence of rating processes from any conflicts of interest. For example, form years our analysis activities are separated from commercial ones, so analysts are not involved, nor do they have information about contracts with our customers. Not only that: the remuneration of our analysts has never been correlated with the remuneration recognized by the issuers....

We have also created independent functions responsible for internal quality and definition of the criteria, appointed external and independent directors on the boards of directors of our companies in Europe and in the United States.

We expect a constant rotation of analysts so that no one takes care of an issuer beyond a certain time frame. When an analyst leaves S & P, we conduct a retroactive analysis of his work to ensure greater protection of the integrity and independence of our ratings. We impose strict limitations to ours analysts on the investments in companies or sectors of which they formulate the rating and on the acceptance of any gifts. The investments made since 2007 in the governance and control functions amount to about 200 million euros. ...

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The effectiveness of internal controls is monitored by the Compliance Department, but above all it is subject to active and continuous supervision by securities regulators around the world, including the ESMA in the European Union and the SEC in the United States. These authorities have extensive powers to carry out inspections in registered rating agencies and to sanction them in case of violation of regulations. ...

Other critics argue that the ratings are unduly influenced by the business model adopted by almost all rating agencies, under which issuers are paid ("issuer-pays"), forgetting that many of the most ferocious criticisms have been moved precisely by those to whom we issue ratings. ...

We believe that the "issuer-pays" model represents the best system available to the markets if the conflicts are appropriately managed, because it allows the rating to be available to all investors at the same time and free of charge.

The model according to which investors would pay ("investor pays"), on the other hand, places restrictions on the disclosure of ratings, which would not be public. It also presents potential conflicts, as investors may have an interest in a higher or lower rating depending on the positions held. As has been demonstrated by many independent analyzes, no activity is immune to potential conflicts of interest. What makes the difference is the way in which these potential conflicts are managed and monitored and which is the most effective system for rating users. Constant public monitoring is legitimate and healthy, but should be based on the assessment of the facts and on the awareness that the existing system is able to promote transparency, correct governance and continuous supervision by regulatory authorities. ...

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Sources for research: Regulations (EU) 2015/2365, SFT | Regulations (UE) 648/2012, OTC derivatives | Directive 2009/65/EC, UCITS IV | DIRECTIVE 2014/91/EU, UCITS

V | DIRECTIVE

2014/65/EU,

MiFID,

amending

directive

2011/61/EU | Article 2357, Civil Code Italy | DIRECTIVE 2011/61/EU, FIA, GEFIA |Regulation 2016/438/EU, amending

236-2012,

obligations

regulations

credit

depositaries |

default

swaps | Regulations

Regulations

2016/438/EU | Directive

(EU)

2018/1619,

2006/49/EC,

capital

adequacy | Directive 2013/36/EU, repealing directive 2006/48/EC | ESMA 2012/122,

guigelines

automated

trading | Regulation

2017/576/UE,

supplementing 2014/65/EU | Regulations (EU) 2017/568, supplementing 2014/65/EU | REGULATION (EU) No 600/2014, MiFIR | Regulation (EC) 1060/2009, credit rating agencies | RAPITI, Eleonora Maria. The new

frontier

of

the

financial

market:

high

frequency

trading.

2016 | HENDERSHOTT, Terrence; JONES, Charles M.; MENKVELD, Albert J. Does algorithmic trading improve liquidity?. The Journal of Finance, 2011, 66.1: 1-33. | KIRILENKO, Andrei, et al. The Flash Crash: High-frequency trading in an electronic market. The Journal of Finance, 2017,

72.3:

967-998. | BROGAARD,

Jonathan;

HENDERSHOTT,

Terrence; RIORDAN, Ryan. High-frequency trading and price discovery.

The Review of Financial Studies, 2014, 27.8: 2267-2306 | PUORRO, Alfonso. High Frequency Trading: An overview (High Frequency Trading: An Overview). 2013. |

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BIBLIOGRAPHY. For the research we have referred to the following quotations.

PUBLICATION 2019-20,05 1) REGULATION (EU) 2015/2365 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 25 November 2015 on transparency of securities financing transactions and of reuse and amending Regulation (EU) No 648/2012. (Text with EEA relevance).

2) REGULATION (EU) No 648/2012 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 4 July 2012 on OTC derivatives, central counterparties and trade repositories.

(Text with EEA relevance).

3) DIRECTIVE 2009/65/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 13 July 2009 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities UCITS, (recast). (Text with EEA relevance).

4) DIRECTIVE 2014/91/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 23 July 2014 amending Directive 2009/65/EC on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS) as regards depositary functions, remuneration policies and sanctions (Text with EEA relevance).

5) DIRECTIVE 2014/65/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU, (recast). (Text with EEA relevance).

6) Device of the art. 2357 Civil Code Sources Civil code BOOK FIFTH - Of the work, Title V Of the companies (articles 2247-2510), Chapter V - Public limited company »Section V - Of the shares and other participatory financial instruments.

7) DIRETTIVA 2011/61/UE DEL PARLAMENTO EUROPEO E DEL CONSIGLIO dell’8 giugno 2011 sui gestori di fondi di investimento alternativi, che modifica le direttive 2003/41/CE e 2009/65/CE e i regolamenti (CE) n. 1060/2009 e (UE) n. 1095/2010. (Testo rilevante ai fini del SEE).

8) REGULATION (EU) No 236/2012 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 14 March 2012 on short selling and certain aspects of credit default swaps.

(Text with EEA relevance).

9) COMMISSION DELEGATED REGULATION (EU) 2016/438 of 17 December 2015 supplementing Directive 2009/65/EC of the European Parliament and of the Council with regard to obligations of depositaries. (Text with EEA relevance).

10) COMMISSION DELEGATED REGULATION (EU) 2018/1619 of 12 July 2018 amending Delegated Regulation (EU) 2016/438 as regards safe-keeping duties of depositaries. (Text with EEA relevance).

11) DIRECTIVE 2006/49/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

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of 14 June 2006 on the capital adequacy of investment firms and credit institutions (recast).

12) DIRECTIVE 2013/36/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC. (Text with EEA relevance).

13) ESMA/2012/122 (EN). Guidelines Systems and controls in an automated trading environment for trading platforms, investment firms and competent authorities.

14) COMMISSION DELEGATED REGULATION (EU) 2017/576 of 8 June 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council with regard to regulatory technical standards for the annual publication by investment firms of information on the identity of execution venues and on the quality of execution. (Text with EEA relevance).

15) COMMISSION DELEGATED REGULATION (EU) 2017/568 of 24 May 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council with regard to regulatory technical standards for the admission of financial instruments to trading on regulated markets. (Text with EEA relevance).

16) REGULATION (EU) No 600/2014 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 15 May 2014 on markets in financial instruments and amending Regulation (EU) No 648/2012. (Text with EEA relevance).

17) REGULATION (EC) No 1060/2009 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 16 September 2009 on credit rating agencies. (Text with EEA relevance).

18) RAPITI, Eleonora Maria. The new frontier of the financial market: high frequency trading.

2016.

19) HENDERSHOTT, Terrence; JONES, Charles M.; MENKVELD, Albert J. Does algorithmic trading improve liquidity?. The Journal of Finance, 2011, 66.1: 1-33.

20) KIRILENKO, Andrei, et al. The Flash Crash: High-frequency trading in an electronic market. The Journal of Finance, 2017, 72.3: 967-998.

21) BROGAARD, Jonathan; HENDERSHOTT, Terrence; RIORDAN, Ryan. High-frequency trading and price discovery. The Review of Financial Studies, 2014, 27.8: 2267-2306.

22) PUORRO, Alfonso. High Frequency Trading: An overview (High Frequency Trading: An Overview). 2013.

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PUBLICATION 2019-20,04 The publications of the H Research Edition magazine from the year 2015 that concern the University Studies starting from the numbers published in the year 2015 will refer to the research carried out in the field of the teaching of the "Mechanics Applied to the Machines"; Publication rapporteur and Research Coordinator professor Lelio Della Pietra, Federico II University of Naples.

The 0A bibliography was published in the title 'H Research Edition' number 2018-19, article 1.

It should be noted that, having essentially taken into consideration the documentation available at the Faculty of Engineering of the University of Naples, easier to access, the development of the figure of the engineer will be outlined by basically reviewing the one carried out in Naples, with evidence of what happened In the rest of Italy during the reference period and in the major European centers.

Since the history of Engineering studies in Naples has been extensively extended in the fine volume "THE INGEGNER SCHOOL IN NAPLES 1811-1967" (edited by Giuseppe Russo, published on the occasion of the transfer of the Faculty of Engineering from Mezzocannone to New buildings of Fuorigrotta), for events going back to 1967 we will refer to it, beyond the bibliographic list of authors listed below.

References in alphabetical order 1) BELANGER, J. B. Traité de cinématique / J. B. Bélanger. Paris: Gauthier-Villars, 1864 2) BOCQUET, J. A. Elementary course in applied mechanics / J. A. Bocquet; translation of F. Sinigaglia. 4. ed. Napoli, Italy: Pellerano Scientific and Industrial Library, 1919 3) BOIDI, Giuseppe A. The builder mechanical engineer, ie course of practical theoretical drawing of the machines / Giuseppe A. Boidi. Torino, Italy: V. Bona, 1873 4) BOIDI, Giuseppe A.: Terms used in species to practical mechanics. XVI, 427, 31 p.: ill.

Torino, Italy: V. Bona, 1873 5) BORGNIS, J. A. Traité complet de mécanique appliquée aux arts : contenant l'exposition méthodique des théories et des expériences les plus utiles pour diriger le choix, l'invention, la construction et l'emploi de toutes les espèces de machines / par J. A. Borgnis Paris : Bachelier, 1818 6) BORGNIS, J. a. Mouvements des fardeaux. XII, 335 p., 20 tav.: ill. Paris: Bachelier, 1818 7) BORGNIS, J. a. Des machines employées dans les constructions diverses. XII, 319 p., 26 tav.: ill. Paris: Bachelier, 1818- 8) BORGNIS, J. a. Composition des machines. XXXIII, 428 p., 43 tav.: ill. Paris: Bachelier, 1818 9) BOULVIN, J. Cours de mécanique appliquée aux machines: professe a l'Ecole spéciale du

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génie civil de Gand. / J. Boulvin. 2. ed. Paris: E. Bernard, 1906 10) BOULVIN, J. 1. : Théorie générale des mécanisme. VIII, 279 p. : ill. 2. ed. Paris : E. Bernard, 1906 11) BOULVIN, J. 8.: Appareils de levage, transmission dutravail à distance. 248, XXX p.: ill.

Paris : E. Bernard et C., 1899 12) BOUR, Edm. 1.: Cinématique. 318 p. Paris: Gauthier - Villars, 1865 13) CAVALLI, Ernesto: Elements of mechanics applied to machines / Ernesto Cavalli. Napoli, Italy: A.Trani, 1908 14) COLLIGNON, Edouard1.: Cinématique. IV, 504 p. : ill. Paris : Hachette et C., 1873 15) CONTALDI, Pasquale2.: Applied mechanics, resistance of materials, mechanics applied to machines, transmissions. 342 p. Fermo, Italy: Cooperative typographic establishment, 1906 16) CONTALDI, Pasquale 2.: Applied mechanics, resistance of materials, mechanics applied to machines, transmissions. Tavole. 44 tav. ill. Fermo, Italy: Cooperative typographic establishment, 1906 17) DE BIASE, Luigi. Course of mechanics applied to the machines / Luigi De Biase. Napoli, Italy: V. Bestito, 1914 18) DELAUNAY, Charles-eugene. Cours élémentaire de mécanique théorique et appliquée / Charles-Eugene Delaunay. 9. ed. rist.: Garnier freres : G. Masson, 1878 19) DORGEOT, E. Cinématique théorique et appliquée / E. Dorgeot. Paris : H. Dunod et E.Pinat, 1919 20) DULOS, Pascal 4: XI, 565 p.: ill. Paris: Gauthier Villars, 1879 21) DULOS, Pascal 5: 254 p.: ill. Paris: Gauthier- Villars, 1883 22) DWELSHAUVERS, V. Manuel de mécanique appliquée / V. Dwelshauvers. Paris Liège : J. Baudry, 1866 23) DWELSHAUVERS, V. 1.: Cinématique. III, 214, IV, p., 12 tav.: ill. Paris-Liège: J. Baudry, 1866 24) FERRARO, Ernesto: Sunto of the lessons of mechanics applied to the machines and related drawing / dictated by Ernesto Ferraro; autographed for the care of the pupil Attilio Gallucci. Napoli, Italy: Lithography of the Trinacria, 1883

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25) FERRARO, Ernesto 1. : Preliminaries. 207 p.: ill. Head to the front.: Naples R. School of applications for engineers - 2. Course - School year 1883-84 Napoli, Italy: Lithography of the Trinacria, 1884 26) FERRARO, Ernesto: Sunto of the lessons of mechanics applied to the machines and related drawing / dictated by Ernesto Ferraro; autographed for the care of the pupil Attilio Gallucci. Napoli, Italy: Lithography of the Trinacria, 1884 27) FERRARO, Ernesto 2: Examination of rigid elements 331 p. ill. Head to front: Naples - R. School of applications for engineers - 2. Course - School year 1883-84 Naples, Italy: Lithography of Trinacria, 1884 28) FERRARO, Ernesto 3.: Examination of rigid elements 223 p. ill. Head to front: Naples - R. School of applications for engineers - 2. Course - School year 1883-84 Naples, Italy: Lithography of Trinacria, 1884 29) FERRETTI, Pericle: Mechanics of Machines / Pericle Ferretti1 ed. Napoli, Italy: Raffaele Pironti, 1952 30) FERRETTI, Pericle: Mechanics of Machines / Pericle Ferretti. Napoli, Italy: Liguori, 1966 31) FERRETTI, Pericle1. : 440 p. : ill. Napoli, Italy: Library Liguori, 1960 32) FOPPL, August Vorlesungen uber technische Mechanik / August Foppl. 14 Auf. Munchen : Leibniz, 1948 33) FOSCHI, Vittorio: Applied mechanical exercises / Foschi Vittorio Roma: Italian editions, 1943 34) FRISI, Paolo: Institutions of mechanics, hydrostatics of hydrometry and static architecture, and hydraulics for the use of directing school erected in Milan for architects, and for engineers / a.d.d. Fr. Frisi In Milan, Italy: Giuseppe Galeazzi, 1777 35) GOUARD,

E. Cours

élémentaire

de

mécanique

industrielle:

principes

généraux,

applications, exercices pratiques / parE. Gourd et G. Hiernaux; préface de Ferdinand Farjon. 2. éd. revue corrigée et augmentée Paris: H. Dunod et E. Pinat, 1914 36) GOUARD, E. 1. : VIII, 386 p.: ill. In testa al front.: Bibliothèque dell'enseignement technique2. éd. revue corrigée et augmentée Paris : H. Dunod et E. Pinat, 1914 37) GRANDS dessins coloriés pour l'enseignement de la mécanique / composés sous la direction de M. le général Morinet par le soins de Tresca. Paris : Librairie de L. Hachette et C.,

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1856 38) HABICH, E. j. Etudes cinématiques Paris : Gauthier Villars, 1879 39) Hachette, Jean Nicolas Pierre Traite élémentaire des machines Paris : J. Klostermann, 1811 40) HARTMANN, G. h. Les mécanismes / G. H. Hartmann. Paris : Librairie Bailliere, 1925 41) JULIA, Gaston Cours de cinématique / Gaston Julia ; redige par J. Dieudonné. Paris : Gauthier-Villars, 1928 42) LEONI, A. Industrial mechanics: lessons / by A. Leoni; collected for the care of students G. Merlini and A. Zani Milano, Italy: s..., 1891-92 (Typ. lit. G. Tenconi) 43) LEONI, Antonio Machine theory: lessons / by Antonio Leoni; collected by the pupil Gerolamo Merlini, Milano, Italy: s.e., 1891-1892 44) LEONI, A. 1 .: 205 p. : ill.In head to front .: RITS. Milan, Italy: s.e., 1891-92 (Typ. lit. G. Tenconi) 45) MORIN, Arthur Aide-mémoire de mécanique pratique / Arthur Morin. 4. éd. Paris : L. Hachette et C., 1860 46) MORIN, Arthur Aide mémoire de mécanique pratique : à l'usage des officiers d'artillerie et des ingénieurs civils et militaires / par Arthur Morin. Bruxelles : Société belge de libraire, 1837 47) MORIN, Arthur Notions géométriques sur les mouvements et leurs transformation, ou éléments de cinématique / Arthur Morin. 3. éd. Paris : L. Hachette et C., 1861 48) MORIN, Arthur Aide-mémoire de mécanique pratique a l'usage des officiers d'artillerie et des ingénieurs civils et militaires / par Arthur Morin. 2. ed. Metz : Thiel : Le neveu, 1838 49) MORIN, Arthur Notions géométriques sur les mouvements et leurs transformation, ou éléments de cinématique / Arthur Morin. 3. éd. Paris : L. Hachette et C., 1861 50) NAVIER, Louis Marie Henri Summary of the lessons given to the School of Bridges and Roads on the application of mechanics to the construction and machinery plant / Louis Marie Henri Navier. Naples: From the printing house and paper mill of the Fibreno, 1836 51) NAVIER, Louis-Marie Henri Résumé des leȯns : données à l’école des ponts et chaussées sur l'application de la mécanique à l'établissement des constructions et des machines / LouisMarie Henri Navier ; 3. éd. avec des notes et des appendices par Barre de Saint-Venant. 3. éd.

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Paris : Dunod, 1864- 52) NAVIER, Louis-Marie Henri Résumé des leȯns : données à l’école des ponts et chaussées sur l'application de la mécanique à l'établissement des constructions et des machines / LouisMarie Henri Navier. A Paris: Carilian-Goeury, 1838 53) NAVIER, Louis-Marie Henri Résumé des leons : données à l’école royale des ponts et chaussées sur l'application de la mécanique àl'établissement des constructions et des machines / Louis-Marie Henri Navier Paris : Chez F. Didot, 1826 54) NAVIER, Louis-marie-henri1. : Translated on the 2. ed., Accompanied by the additions and an appendix on suspended bridges / by C. D. D'Andrea. XXXII, 584 p., 6 pl. : ill. Naples, Italy: From the printing house and paper mill of the Fibreno, 1836 55) NAVIER, Louis-marie-henri: XI, 428 p., 5 tav. : ill. Paris: Chez F. Didot, 1826- 56) PANETTI, M. Mechanics applied to the machines / M. Panetti. Torino, Italy: University Publishing Library Levrotto e Bella, s.d.

57) PANETTI, M. 3. : Flexible. 208, III p. : ill. 4. ed. Torino, Italy: University Publishing Library Levrotto e Bella, s.d.

58) PERRY, John Applied mechanics : a tretise for the use of students who have time to work experimental, numerical, and graphical exercises illustrating the subject / John Perry ; new ed. revised and enlarged. London : Cassel and C., 1907 59) PERRY, John Mécanique appliquée : à l'usage des élèves qui peuvent travailler éxperimentalement et faire des éxercices numériques et graphiques / John Perry ; ouvrage traduit sur la neuvième édition anglaise par E. Davaux ; avec des addition et un appendice sur la mécanique des corps déformables par E. Cosserat , F. Cosserat. Paris : Librerie scientifique A. Herman et Fils, 1913 60) PETERSEN, Julius Kinematik : deutsche ausgäbe unter Mitwirkung des Verfassers besorgt von R. von Fischer-Benzon / Julius Petersen. Kopenhagen : A.F.Host und sohn, 1884 61) PISTOLESI, E. Mechanics applied to machines / E. Pistolesi. 10. ed. Florence, Italy : A. Vallerini, 1958 62) POLI, Cino General and applied mechanics / Cino Poli. Torino, Italy: UTET, 1927- 63) POLI, Cino1. : Vector calculation, kinematics 611 p. : ill. Torino, Italy: UTET, 1927 64)

REULEAUX, F. Le constructeur : tables, formules, règles, calculs, tracés et

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renseignements pour la construction des organes de machines : aide-mémoire à l'usage des ingénieurs, constructeurs, architectes, mécaniciens / F. Reuleaux ; éd. franȧise publié sur la 3. éd. allemande par A. Debieze et E. Merijot. Paris: F. Savy, 1875 65) REULEAUX, F. Le constructeur : principes, formules, tracés, tables et renseignements pour l'établissement des projets de machines, àl'usage des ingénieurs, constructeurs, architectes, mécaniciens / F. Reuleaux ; 3. éd. franȧise traduite de l'allemand sur la 4. éd. entièrement refondue et considérablement augmentée par A. Debize 3. éd. Paris: F. Savy, 1890 66) REULEAUX, F. Fundamental principles of a general machine theory / F. Reuleaux; authorized translation of Giuseppe Colombo Milan-Naples, Italy: U. Hoepli, 1874 67) REULEAUX, F. General machine theory: theoretical kinematics / F. Reuleaux. S.l. : s.e., 1874 68) REULEAUX, Franz, 1829-1905 Cinématique : principes fondamentaux d'une théorie générales des machines / par F. Reuleaux ; traduit de l'allemand par A. Debize Paris Librairie F. Savy1877 69) RICCI, Carlo luigi: LESSONS OF MECHANICS APPLIED TO MACHINES / RICCI CARLO LUIGI, Pisa, Italy: National Union of Engineers, 1921 70) RUBINO, Mario: Mechanics applied to machines / Mario Rubino. 3. ed. Milano, Italy: Principality, 1958 71) SCOTTO LAVINA, Giovanni Applications of mechanics of the machines / Giovanni Scotto Lavina. Milan, Italy: Tamburini, 1949 72) SCOTTO LAVINA, G. Summary of the mechanics lessons applied to the machines / G. Scotto Lavina. Rome, Italy: Siderea, 1970 73) TADDEI, Mario2. : 432 p. : ill. Napoli, Italy: Liguori, 1981 74) TADDEI, Mario3. : 318 p. : ill. Napoli, Italy: Liguori, 1981 75) TAFFE, A. Applications de la mécanique aux machines / A. Taffe ; 4. éd. revue, corrigée et augmentée de chapitres nouveaux par P. Boileau. 4. éd Paris : Libraire du dictionnaire des arts et manufactures, 1872

76) TESSARI, Domenico: The kinematics applied to machines: for use in application schools

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for engineers, engineers and mechanical constructors / Domenico Tessari. Turin, Italy: E. Loescher, 1890 77)

WITTENBAUER, Ferdinand Aufgaben aus der technischen Mechanik / Ferdinand

Wittenbauer ; 5. verbesserte auf. bearbeitet von Theodor Psochl. 5. verbesserte auf. Berlin: J. Springer, 1924 78) WITTENBAUER, Ferdinand Aufgaben aus der technischen Mechanik / Ferdinand Wittenbauer.3. verbesserte auf. Berlin : J. Springer, 1918

List of authors in conrological order HACHETTE 1811

BORGNIS 1818

GRANDS 1856

MORIN 1861 1860 1837 1861

LABOULAYE 1864 TAFFE 1872

BELANGER 1864

COLLIGNON 1873

PONCELET 1874 1876 RANKINE 1877

BOUR 1865

BOIDI 1873

KELLER 1874

PETERSEN 1884

BOULVIN

PERRY 1907 1913 GOUARD 1914

1899 1906

DWELSHAUVERS 1866

HATON DE LA GOUPILLIERE 1874

REULEAUX 1875 1890 1874 1877

CAVALLI 1908

LEONI 1891-92 WEVE 1907

GABRIEL 1911 1913

BRUNELLI 1916 DORGEOT 1919

PISTOLESI 1958

DULOS 1879 1883

TESSARI 1890

CONTALDI 1906

WITTENBAUER 1924 HARTMANN 1925 PANETTI

REDTENBACHER 1861 1872 1868

DELAUNENAY 1878 HABICH 1879

FERRARO 1883 1884 MASI 1897

BABBAGE 1834 NAVIER 1836 1864 1838 1826

POLI 1927

FERRETTI 1960 1966

DE BIASE 1914

BOCQUET 1919 JULIA 1928

FOPPL 1948

TOLLE 1961

TADDEI 1981

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PUBLICATION 2019-20,03 1) COUNCIL DIRECTIVE 75/716/EEC of 24 November 1975 on the approximation of the laws of the Member States relating to the sulphur content of certain liquid fuels.

2) COUNCIL DIRECTIVE 87/219/EEC of 30 March 1987 amending Directive 75/716/EEC on the approximation of the laws of the Member States relating to the sulphur content of certain liquid fuels.

3) COUNCIL DIRECTIVE 93/12/EEC of 23 March 1993 relating to the sulphur content of certain liquid fuels.

4) DIRECTIVE 98/70/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 13 October 1998 relating to the quality of petrol and diesel fuels and amending Council Directive 93/12/EEC. 5) DIRECTIVE 2009/30/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 23 April 2009, amending Directive 98/70/EC as regards the specification of petrol, diesel and gas-oil and introducing a mechanism to monitor and reduce greenhouse gas emissions and amending Council Directive 1999/32/EC as regards the specification of fuel used by inland waterway vessels and repealing Directive 93/12/EEC; (Text with EEA relevance).

6) INTERNATIONAL STANDARD ISO 8754. Petroleum products - Determination of sulfur content Energu dispersive X-ray fluorescence spectrometry.

7) INTERNATIONAL STANDARD ISO 4259-2. Petroleum and related products - Precision of measurement methods and results. Part 2: interpretation and application of precision data in relation to methods of test.

8) DIRECTIVE 94/12/EC OF THE EUROPEAN PARLIAMENT AND THE COUNCIL of 23 March 1994 relating to measures to be taken against air pollution by emissions from motor vehicles and amending Directive 70/220/EEC. 9) COUNCIL DIRECTIVE 70/220/EEC of 20 March 1970 on the approximation of the laws of the Member States relating to measures to be taken against air pollution by gases from positive-ignition engines of motor vehicles.

10) COMMISSION DIRECTIVE 2014/77/EU of 10 June 2014 amending Annexes I and II of Directive 98/70/EC of the European Parliament and of the Council relating to the quality of petrol and diesel fuels; (Text with EEA relevance).

11) DIRECTIVE (EU) 2015/1513 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 9 September 2015, amending Directive 98/70/EC relating to the quality of petrol and diesel fuels and amending Directive 2009/28/EC on the promotion of the use of energy from renewable sources; (Text with EEA relevance).

12) Clipboard, course of Machines, Federico II University of Naples, Mechanical Engineering, Professor Renato della Volpe.

13) Renato della Volpe, Machines, Liguori Editore, Naples, 1994.

14) Sources: Mario Alnin, Steam Generators, Liguori Editore, Naples 1967.

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PUBLICATION 2019-20,02 1) CONSOLIDATED VERSION OF THE TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION. His Majesty the King of the Belgians, the President of the Federal Republic of Germany, the President of the French Republic, the President of the Italian Republic, Her Royal Highness the Grand Duchess of Luxembourg, Her Majesty the Queen of the Netherlands, DETERMINED to lay the foundations of an ever closer union among the peoples of Europe, RESOLVED to ensure the economic and social progress of their States by common action to eliminate the barriers which divide Europe, AFFIRMING as the essential objective of their efforts the constant improvements of the living and working conditions of their peoples, RECOGNISING that the removal of existing obstacles calls for concerted action in order to guarantee steady expansion, balanced trade and fair competition, ANXIOUS to strengthen the unity of their economies and to ensure their harmonious development by reducing the differences existing between the various regions and the backwardness of the less favoured regions, DESIRING to contribute, by means of a common commercial policy, to the progressive abolition of restrictions on international trade, INTENDING to confirm the solidarity which binds Europe and the overseas countries and desiring to ensure the development of their prosperity, in accordance with the principles of the Charter of the United Nations, RESOLVED by thus pooling their resources to preserve and strengthen peace and liberty, and calling upon the other peoples of Europe who share their ideal to join in their efforts, DETERMINED to promote the development of the highest possible level of knowledge for their peoples through a wide access to education and through its continuous updating, and to this end HAVE DESIGNATED as their Plenipotentiaries: (List of plenipotentiaries not reproduced) WHO, having exchanged their full powers, found in good and due form, have agreed the provisions, of the Treaty on the Functioning of the European Union.

2) REGULATION (EU) No 648/2012 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 4 July 2012 on OTC derivatives, central counterparties and trade repositories, (Text with EEA relevance).

3) REGULATION (EU) No 575/2013 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012, (Text with EEA relevance).

4) REGULATION (EU) No 1095/2010 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 24 November 2010 establishing a European Supervisory Authority (European Securities and Markets Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/77/EC. 5) REGULATION (EU) No 1092/2010 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 24 November 2010 on European Union macro-prudential oversight of the financial system and establishing a European Systemic Risk Board.

6) DIRECTIVE 2006/48/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 14 June 2006 relating to the taking up and pursuit of the business of credit institutions (recast), (Text with EEA relevance).

7) REGULATION (EU) No 1093/2010 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 24 November 2010 establishing a European Supervisory Authority (European Banking Authority), amending Decision No 716/2009/EC and repealing Commission

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Decision 2009/78/EC. 8) REGULATION (EC) No 1606/2002 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 19 July 2002 on the application of international accounting standards.

9) REGULATION (EU) No 1094/2010 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 24 November 2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/79/EC. 10) REGULATION (EC) No 1606/2002 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 19 July 2002 on the application of international accounting standards.

11) COMMISSION REGULATION (EC) No 1569/2007 of 21 December 2007 establishing a mechanism for the determination of equivalence of accounting standards applied by third country issuers of securities pursuant to Directives 2003/71/EC and 2004/109/EC of the European Parliament and of the Council.

12) DIRECTIVE 2006/49/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 14 June 2006 on the capital adequacy of investment firms and credit institutions (recast).

13) DIRECTIVES DIRECTIVE 2013/36/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC, (Text with EEA relevance).

14) Proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Directive 2013/36 / EU as regards exempted entities, financial holding companies, mixed financial holding companies, remuneration, supervisory measures and powers and measures capital preservation (Text with EEA relevance). The proposal to amend Directive 2013/36 / EU (Capital Requirements Directive or CRD) is part of a legislative package which also includes amendments to Regulation (EU) no. 575/2013 (Capital Requirements Regulation or CRR), of Directive 2014/59 / EU (Bank Resolution and Resolution Directive, BRRD) and of Regulation (EU) no. 806/2014 (Single Resolution Mechanism Regulation or SRMR).

16) REGULATION (EU) No 1093/2010 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 24 November 2010 establishing a European Supervisory Authority (European Banking Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/78/EC. 17) DIRECTIVE (EU) 2015/2366 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 25 November 2015 on payment services in the internal market, amending Directives 2002/65/EC, 2009/110/EC and 2013/36/EU and Regulation (EU) No 1093/2010, and repealing Directive 2007/64/EC, (Text with EEA relevance).

18) REGULATION (EC) No 1060/2009 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 16 September 2009 on credit rating agencies, (Text with EEA relevance).

19) DIRECTIVE (EU) 2015/849 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) No 648/2012

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of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC, (Text with EEA relevance).

20) Article 2359 of the Civil Code Member State European Union, Italy Subsidiaries and associated companies Device of the art. 2359 of the Civil Code Sources »Civil code» BOOK FIFTH - Of work »Title V - Of companies (articles 2247-2511)» Chapter V - Public limited company »Section V - Of actions and other instruments.

21) REGULATION (EU) No 260/2012 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 14 March 2012 establishing technical and business requirements for credit transfers and direct debits in euro and amending Regulation (EC) No 924/2009, (Text with EEA relevance).

22) DIRECTIVE 2009/110/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 16 September 2009 on the taking up, pursuit and prudential supervision of the business of electronic money institutions amending Directives 2005/60/EC and 2006/48/EC and repealing Directive 2000/46/EC, (Text with EEA relevance).

23) Article 2477 of the Civil Code Member State European Union, Italy Auditor and legal audit Device of the art. 2477 of the Civil Code Sources »Civil code» BOOK FIFTH - Of work »Title V - Of companies (articles 2247-2511)» Chapter VII - Of the company with responsibility limited »Section III - Of the administration of the company.

24) DIRECTIVE 2013/34/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC, (Text with EEA relevance).

25) DIRECTIVE 2006/43/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 17 May 2006 on statutory audits of annual accounts and consolidated accounts, amending Council Directives 78/660/EEC and 83/349/EEC and repealing Council Directive 84/253/EEC (Text with EEA relevance).

26) REGULATION (EU) No 537/2014 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 16 April 2014 on specific requirements regarding statutory audit of publicinterest entities and repealing Commission Decision 2005/909/EC, (Text with EEA relevance).

27) Article 1852 Civil Code Member State European Union, Italy Provisions on the part of the account holder Device of the art. 1852 Civil code Sources »Civil code» BOOK FOUR - Of the obligations »Title III - Of the single contracts (articles 1470-1986)» Chapter XVII - Of the contracts banking »Section V - Bank transactions in current accounts.

28) Article 1834 Civil Code Member State European Union, Italy Money deposits Device of the art. 1834 Civil code Sources »Civil code» BOOK FOUR - Of the obligations »Title III - Of the single contracts (articles 1470- 1986)» Chapter XVII - Of the contracts banking »Section I - Of bank deposits.

29) Article 1842 Civil Code Member State European Union, Italy Notion Device of the art.

1842 Civil Code Sources »Civil code» BOOK FOUR - Of the obligations »Title III - Of the single contracts (articles 1470- 1986)» Chapter XVII - Of the contracts banking »Section III -

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Opening of bank credit.

30) Article 1813 Civil Code Member State European Union, Italy Notion Device of the art.

1813 Civil Code Sources »Civil Code» BOOK FOUR - Of the obligations »Title III - Of the single contracts (articles 1470- 1986)» Chapter XV - Of the mortgage.

31) Article 1825 Civil Code Member State European Union, Italy Interests Device of the art.

1825 Civil Code Sources »Civil Code» BOOK FOUR - Of the obligations »Title III - Of the single contracts (articles 1470- 1986)» Chapter XVI - Of the current account.

32) COMMISSION IMPLEMENTING REGULATION (EU) No 680/2014 of 16 April 2014 laying down implementing technical standards with regard to supervisory reporting of institutions according to Regulation (EU) No 575/2013 of the European Parliament and of the Council, (Text with EEA relevance).

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PUBLICATION 2019-20,01 1) A1) (2016/C 202/01) Consolidated versions of the treaty on european Union and the treaty on the functioning of the european Union. This publication contains the consolidated versions of the Treaty on European Union (TEU) and of the Treaty on the Functioning of the European Union (TFEU), together with the annexes and protocols thereto, as they result from the amendments introduced by the Treaty of Lisbon, which was signed on 13 December 2007 in Lisbon and which entered into force on 1 December 2009. It also contains the declarations annexed to the Final Act of the Intergovernmental Conference which adopted the Treaty of Lisbon.

In addition, this publication contains an amendment effected by the Protocol amending the Protocol on Transitional Provisions annexed to the Treaty on European Union, to the Treaty on the Functioning of the European Union and to the Treaty establishing the European Atomic Energy Community and an amendment effected by Regulation (EU, Euratom) No 741/2012 of the European Parliament and of the Council of 11 August 2012 amending the Protocol on the Statute of the Court of Justice of the European Union and Annex I thereto, as well the amendments effected by European Council Decisions 2010/718/EU and 2012/419/EU of 29 October 2010 and of 11 July 2012 amending respectively the status with regard to the European Union of the island of Saint-BarthĂŠlemy and of Mayotte.

Furthermore, this publication contains the addition of paragraph 3 to Article 136 TFEU, effected by European Council Decision 2011/199/EU of 25 March 2011 amending Article 136 of the Treaty on the Functioning of the European Union with regard to a stability mechanism for Member States whose currency is the euro, following the completion of the ratification procedures of the Member States. This publication also contains the amendments brought about by the Act of Accession of the Republic of Croatia. This publication also contains amendments effected by Regulation (EU, Euratom) 2015/2422 of the European Parliament and of the Council of 16 December 2015 amending the Protocol on the Statute of the Court of Justice of the European Union.

This publication also contains the corrigenda that were adopted up to March 2016.

This publication also contains the Charter of Fundamental Rights of the European Union which was proclaimed at Strasbourg on 12 December 2007 by the European Parliament, the Council and the Commission (OJ C 303, 14.12.2007, p. 1). This text repeats and adapts the Charter proclaimed on 7 December 2000, and replaces it with effect from 1 December 2009, the date of entry into force of the Treaty of Lisbon. By virtue of the first subparagraph of Article 6(1) of the Treaty on European Union, the Charter proclaimed in 2007 has the same legal value as the Treaties.

This publication has been produced for documentary purposes and does not involve the responsibility of the institutions of the European Union 2) ( 73 /240/EEC) COUNCIL DIRECTIVE of 24 July 1973 abolishing restrictions on freedom of establishment in the business of direct insurance other than life assurance.

3) (79/267/EEC) FIRST COUNCIL DIRECTIVE of 5 March 1979 on the coordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the business of direct life assurance.

4) (78/660/EEC) FOURTH COUNCIL DIRECTIVE of 25 July 1978 based on Article 54 (3 ) (g) of the Treaty on the annual accounts of certain types of companies.

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5) (68/151/EEC) FIRST COUNCIL DIRECTIVE of 9 March 1968 on co-ordination of safeguards which, for the protection of the interests of members and others, are required by Member States of companies within the meaning of the second paragraph of Article 58 of the Treaty, with a view to making such safeguards equivalent throughout the Community.

6) (77/780/EEC) FIRST COUNCIL DIRECTIVE of 12 December 1977 on the coordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the business of credit institutions.

7) DIRECTIVE 97/7/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 20 May 1997 on the protection of consumers in respect of distance contracts.

8) DIRECTIVE 2005/29/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 11 May 2005 concerning unfair business-to-consumer commercial practices in the internal market and amending Council Directive 84/450/EEC, Directives 97/7/EC, 98/27/EC and 2002/65/EC of the European Parliament and of the Council and Regulation (EC) No 2006/2004 of the European Parliament and of the Council (Unfair Commercial Practices Directive). Text with EEA relevance.

9) (84/450/EEC) COUNCIL DIRECTIVE of 10 September 1984 relating to the approximation of the laws, regulations and administrative provisions of the Member States concerning misleading advertising.

10) DIRECTIVE 2002/65/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 23 September 2002 concerning the distance marketing of consumer financial services and amending Council Directive 90/619/EEC and Directives 97/7/EC and 98/27/EC. 11) DIRECTIVE 95/46/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data.

12) REGULATION (EU) 2016/679 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation). Text with EEA relevance.

13) DIRECTIVE 94/47/EC OF THE EUROPEAN PARLIAMENT AND THE COUNCIL of 26 October 1994, on the protection of purchasers in respect of certain aspects of contracts relating to the purchase of the right to use immovable properties on a timeshare basis.

14) REGULATION (EC) No 2006/2004 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 27 October 2004 on cooperation between national authorities responsible for the enforcement of consumer protection laws (the Regulation on consumer protection cooperation). Text with EEA relevance.

15) DIRECTIVE 2011/83/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 25 October 2011 on consumer rights, amending Council Directive 93/13/EEC and Directive 1999/44/EC of the European Parliament and of the Council and repealing Council Directive 85/577/EEC and Directive 97/7/EC of the European Parliament and of the Council.

Text with EEA relevance.

16) DIRECTIVE 2008/48/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

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of 23 April 2008 on credit agreements for consumers and repealing Council Directive 87/102/EEC. 17) DIRECTIVE (EU) 2015/2302 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 25 November 2015 on package travel and linked travel arrangements, amending Regulation (EC) No 2006/2004 and Directive 2011/83/EU of the European Parliament and of the Council and repealing Council Directive 90/314/EEC. 18) DIRECTIVE 2001/83/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 6 November 2001 on the Community code relating to medicinal products for human use.

19) DIRECTIVE 2008/122/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 14 January 2009 on the protection of consumers in respect of certain aspects of timeshare, long-term holiday product, resale and exchange contracts. Text with EEA relevance.

20) DIRECTIVE 98/27/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 19 May 1998 on injunctions for the protection of consumers' interests.

21) COUNCIL REGULATION (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters.

22) REGULATION (EU) No 1215/2012 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters; recast.

23) DIRECTIVE 94/19/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 30 May 1994 on deposit-guarantee schemes.

24) DIRECTIVE 97/9/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 3 March 1997 on investor-compensation schemes.

25) (98/C 27/02) Convention on the law applicable to contractual obligations (consolidated version). First Protocol on the interpretation of the 1980 Convention by the Court of Justice (consolidated version). Second Protocol conferring on the Court of Justice powers to interpret the 1980 Convention (consolidated version).

26) (90/619/EEC) COUNCIL DIRECTIVE of 8 November 1990 on the coordination of laws, regulations and administrative provisions relating to direct life assurance, laying down provisions to facilitate the effective exercise of freedom to provide services and amending Directive 79/267/EEC. 27) DIRECTIVE 2002/83/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 5 November 2002 concerning life assurance.

28) DIRECTIVE 2009/138/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 25 November 2009 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II); recast. Text with EEA relevance.

29) (1999/468/EC) COUNCIL DECISION of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission.

30) REGULATION (EU) No 182/2011 OF THE EUROPEAN PARLIAMENT AND OF THE

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COUNCIL of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission’s exercise of implementing powers.

31) (2006/325/EC) COUNCIL DECISION of 27 April 2006 concerning the conclusion of the Agreement between the European Community and the Kingdom of Denmark on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters.

32) ( 84 / 253 /EEC) EIGHTH COUNCIL DIRECTIVE of 10 April 1984 based on Article 54 ( 3 ) (g) of the Treaty on the approval of persons responsible for carrying out the statutory audits of accounting documents.

33) ( 83 / 349 /EEC) SEVENTH COUNCIL DIRECTIVE of 13 June 1983 based on the Article 54 ( 3 ) ( g) of the Treaty on consolidated accounts.

34) DIRECTIVE 2006/43/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 17 May 2006 on statutory audits of annual accounts and consolidated accounts, amending Council Directives 78/660/EEC and 83/349/EEC and repealing Council Directive 84/253/EEC. Text with EEA relevance.

35) (86/635/EEC) COUNCIL DIRECTIVE of 8 December 1986 on the annual accounts and consolidated accounts of banks and other financial institutions.

36) DIRECTIVE 2013/34/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC. Text with EEA relevance.

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H Research edition. Publisher writing to 22790 Department Italian Government AGCOM ROC. Director Engineer Dr. Gnazzo Vito Annual magazine, publication namber 2019-20 Publisher Italia, Capaccio (Sa) www.htnetEdition.eu ISSN 2532-5612