(Bloomberg) -- Telecom Italia SpA expects a windfall of about €1 billion ($1.1 billion) from the Italian government after a Rome appeals court ruled in favor of the one-time monopolist in a legal case dating back to the late 1990s.

The state has been ordered to pay back about €530 million plus interest to the phone carrier for licensing fees the company paid which were not actually due, according to a copy of the ruling seen by Bloomberg. 

Telecom Italia confirmed the ruling in a statement on Wednesday, saying the decision is “immediately enforceable” and that the company will initiate procedures to recover the funds. A spokesman for the Italian government declined to comment.

Shares of Telecom Italia gained as much as 6.5% in Milan on Wednesday, giving the company a market value of about €5 billion. 

The Italian government said in a statement that it plans to appeal the ruling.

The Rome-based carrier has been struggling for years to cut debt and adapt to an increasingly competitive market. It agreed last year to sell its fixed-line network to KKR & Co., in a blockbuster, state-backed deal expected to be completed during the summer. 

The fee dispute resolves around Telecom Italia’s 1998 payment to the state for licensing, even as the country’s telecommunications industry had been privatized prior to that date. 

Telecom Italia successfully argued in the appeals case that it should be repaid the sum in question plus interest.  

The net figure totals €528.7 million, which could top €1 billion when interest and other fees are taken into account, Telecom Italia said. 

The ruling is not final and could eventually be overturned if the government appeals the decision, people familiar with the matter said. 

--With assistance from Luca Casiraghi.

(Updates with government in fifth paragraph.)

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