When referring to a company that is based in Italy, I am never sure which of the above is correct. Logically speaking, "Italy-based" seems the most appropriate (since the company is based in Italy, not Italian), but I so often see "Italian-based..." written in publications that I begin to doubt myself. Is there a "correct" way, or is it simply a style issue?
In my view "Italian" itself suggests something of Italy or belonging to Italy. Therefore, I am not of the opinion that using "Italian-based firm" is acceptable.
Tata is an Indian company.
This sentence itself suggests the use of "Indian" as something referring to India.
Now the second case: Italy-based company. This would be correct.
Tata is a global company which is India-based.
Both "Italian-Based Company" and "Italy-Based Company" are correct. It all depends on your point of view. Some people might assume that "Italy-Based Company" is right as "Italian-Based Company", like Barrie England mentioned, might become confusing. On the other hand, upon looking up the internet, I realised that most companies say that they are "Italy-Based". Thus, I suggest that you use "Italy-Based Company" first, but if the context does not fit, you may want to use a different form.
An excellent question by the way, it left me and "Google" totally bamboozled. From, David Toh
Some simple points are being missed and, as someone mentioned above, it depends on context.
No-one would ever say, for example, "there is an America (Air Force) base in Germany" instead of "American Base".
Similarly, multinational companies would not say they have an "Italy base" (i.e. headquarters or outlet) instead of "Italian base" or "base in Italy". Only the last two would be considered correct.