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?
It seems a bit more straight forward if you swap a country for a city.
Melbourne based or Melbournian based...
Something that is Italian is from Italy, no matter where it is. Italy-based seems to imply that it is actually in Italy, not just having a history that is Italian.
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