The announcement came four hours after Berlusconi's younger brother, Paolo, surrendered to police in an investigation into alleged bribery and tax fraud at Berlusconi's Fininvest holding company.
"I have decided to freeze my ownership rights and separate them from me," Berlusconi told a news conference. He said the blind trust would be even "more rigid and severe" than an American-style blind trust because it would also include an oversight commission, picked by Italy's president with the backing of parliamentary leaders.
The probe into Fininvest and Berlusconi's private meeting with the company's president after the scandal raised objections from critics about conflict of interest and marked the most significant crisis for the 10-week-old government.
Berlusconi said he would push for "very radical and clear-cut" laws to guard against conflict of interests.
He indicated it could take "some months" to set up the blind trust but expected proposals would be ready to be taken up by parliament by early September at the latest. When he took office in May, he announced he was appointing three experts to come up with a plan to deal with possible conflict of interests, but developments tied to the Fininvest investigation appeared to precipitate Friday's decision.
Berlusconi's $7 billion-a-year Fininvest empire includes three private television stations, advertising, publishing and real estate companies and the nation's biggest retail chain.
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