MILAN, Italy — Milan prosecutors have wrapped up their probe into alleged tax evasion of around €1 billion ($1.13 billion) by fashion group Gucci, paving the way for a formal request for a trial, a judicial source said on Tuesday.

The case will be sent to court unless in the next 20 days the parties agree on a settlement, or new evidence emerges.

The prosecutors suspect Gucci, which is part of French luxury group Kering, may have paid taxes on profits generated by sales in Italy in another country with a more favorable tax regime.

They allege that Gucci owes the Italian tax authorities around €1 billion for revenues booked in the years between 2010 and 2016.

The prosecutors allege Gucci revenues booked through Luxury Goods International (LGI), the Swiss company that manages the distribution and logistics platform for most of Kering's luxury brands, should be taxed in Italy and not in Switzerland.

Gucci chief executive Marco Bizzarri and former chief executive Patrizio Di Marco are under investigation in the case, the source added.

The lawyers for the two executives could not immediately be reached for comment.

Gucci's parent Kering said it was "confident about the correctness and transparency of its operating mode, and is cooperating actively with the competent authorities."

By Emilio Parodi and Agnieszka Flak; editor: Richard Balmforth.

Related Articles:

[ Gucci and Guess End Nine-Year Trademark Dispute ]

[ Gucci Wins Latest Round in Legal Battle With Forever 21 ]