ArcelorMittal last year had threatened to pull out of a 2018 agreement to purchase the Ilva plant in the southern city of Taranto. This was over concerns relating to the expensive clean-up of the heavily polluted site.

The Luxembourg-based steel giant in March this year had agreed an injection of state-funding with Italy and on 11 December announced it has signed a binding agreement with Invitalia to form a public-private partnership.

Under the deal, Invitalia will invest €400m by 31 January 2021, providing it with joint control over AM InvestCo.

A second payment of €680m is due by March 2022, raising Invitalia’s share to 60% of the business. ArcelorMittal has pledged up to €70m to keep 40% of shares and joint control over the company.

The deal is subject to approval from the EU because of antitrust regulation.

One of the conditions of the second investment tranche being paid is “the absence of restrictive measures-- in the context of criminal proceedings where Ilva is a defendant--being imposed against AM InvestCo.”

The European Court of Human Rights in January 2019 said that Italy had failed to protect the rights and lives of citizens in the region, calling on the country to ensure environmental and health protection.

It also foresees the lifting of all criminal seizures on the Taranto plant. An investigating judge in 2012 had ordered the seizure of the plant’s hot working area over pollution charges. The public prosecutor also ordered the arrest of Ilva group managers and some politicians over pollution and the dangers it poses to the local community.

The investigating judge estimated the cost of the clean-up at €8bn.

The plant employs 8,000 people with thousands of jobs by suppliers and contractors in the region linked to the steel site.