Rome has been threatening to revoke Autostrade's operating licence since the deadly collapse of a bridge it ran in 2018.

Speaking in parliament, De Micheli said that talks between Rome and Atlantia to solve the dispute on the concession were blocked as the parties disagreed over whether an accord should be linked to separate talks over the sale of the unit to state lender CDP.

If no agreement is reached, the government could unfreeze a process to strip Autostrade of its concession, she said.

"Should we press on with the revocation, first transport and economy ministers would issue a joint decree then another decree would be needed to temporary manage Autostrade's roads and allow us to split its network and launch a tender to find new toll-road operators," De Micheli said.

In December 2019, Rome approved a bill saying that state-owned road company ANAS would temporarily manage the motorways if a toll-road operator had its concession revoked.

But the government has changed its mind and drafted a new decree to put the motorway operator under administration, two government sources said.

The ruling coalition has already issued two deadlines for Atlantia to cede control of Autostrade to CDP or face having its licence revoked. The first came and went on Sept 30 with no consequences, while the second one is due to expire on Oct 10.

On Thursday Autostrade sent a letter to the ministry saying it would accept a proposed deal over the concession only if the government scrapped a condition under which Atlantia agrees to sell a controlling stake in Autostrade to CDP.

(Reporting by Stefano Bernabei, Francesca Landini and Giuseppe Fonte; editing by Agnieszka Flak, Kirsten Donovan)