One of the EU pillars is free movement of goods, meaning that you generally can't prevent someone from a different country from selling goods in your country.

This means that the decree is either incompatible with EU law, or it is pointless as you'd just be killing your own domestic market while exposing yourself to other EU countries anyway

GP's mistake was assuming that this isn't pure virtue signalling, the decree is compatible with EU law because it applies only to italian producers