The city council in Rome has blocked plans for a domestic partners register for same-sex and heterosexual couples.
The Vatican, which is an independent state within Italy as well as the seat of the Roman Catholic church, had vehemently opposed the measure.
Rightwing groups on the council rejected the modest proposal, whereby couples could have signed a register at the city clerk’s office.
They would then have been entitled to rights to visit their partner in hospital, family rates at city-run leisure centres and other benefits in the control of the council.
In December 2006 Padua city council outraged the Vatican by allowing gay and lesbian couples to register their family.
The reaction from Rome was quick and brutal. An editorial in L’Osservatore Romano, an official Vatican newspaper, branded the city councillors responsible as hypocrites.
Italy’s left-wing coalition government was expected to legislate earlier this year to establish a form of legal recognition, called DiCo, which would have given limited rights to “de facto” couples, gay or straight, whether or not their relationship is sexual.
They would be entitled to some basic inheritance rights, economic benefits and the right to visit their partner in a hospital.
The government’s proposal, which was an election manifesto commitment, has not been discussed in Parliament because the centre-left’s narrow majority means the law would not pass.
Some government MPs, including the so-called “Teodem group,” which strictly follows the Vatican position on the matter, clearly stated that they were against any form of recognition of gay couples.
Teodem senator Paola Binetti, referring to the proposed local registry in Rome, said that it wasn’t fit for the Italian capital.
“Rome is the capital of Italy but also of the Vatican state,” she said.
Earlier this year Ms Binetti claimed that homosexuality was a form of “sexual deviance”.
A new proposal to recognise gay couples is to be debated by the Italian Parliament early next year.
While left-wing politicians support some form of legal recognition for gay and lesbian couples, there is little enthusiasm for gay marriage.
Earlier this month Massimo D’Alema, a former Prime Minister who currently holds the highest post at the Italian Foreign office, said that he was against marriage between gay people,
because “only a marriage between a man and a woman represents the basis of the family according to the Italian Constitution, and is also a sacrament according to the Church.”
He added that gay marriage would offend the religious feelings of many people.
“Same-sex people can live together without necessarily simulating a marriage,” he told an audience of high-school students in Rome, when he was asked his view on the issue.
“The government, however, should recognise their civil and social rights. I would be happy enough making a law in that direction.”