Michelangelo SA and Piazza SA are two Italian companies which produce quality fabrics made out of cotton. Because of the competition from cheap fabric imports from Asia, Michelangelo SA has for many years received a large subsidy from the European Commission, while Piazza SA has benefited from a zero-rated levy on its imports of cotton.The European Commission has recently agreed with the Chinese Department of Trade that in return for ending subsidies for fabric manufacturers, China will lift its embargo on imports of European cheese.Under pressure from the French Government the Commission agrees to this proposal. As a result, in May 2023, the Commission adopted (fictitious) Regulation 50/2023 the purpose of which is to completely abolish, with immediate effect, all subsidies to cotton fabric manufacturers in the EU and authorized Member States to introduce a levy of 10 per cent on imports of cotton.In August 2023, both Michelangelo SA and Piazza SA had signed lucrative contracts to supply cotton toModerno SA, a company which produces luxury clothing made out of cotton. However, as result of Regulation 50/2023 they have had to cancel the contracts because without the subsidy and the zero-rated levy on cotton imports, they cannot produce the material at the price agreed in the contract.Moderno SA has stated that it intends to sue both Michelangelo SA and Piazza SA for breach of contract.Michelangelo SA and Piazza SA consult you because they wish to challenge Regulation 50/2023 under Article 263 TFEU, and to seek compensation against the Commission. Advise them on the following points:(a) whether, if at all, they will have locus standi under Article 263 TFEU. Give reasons for your advice.

On what grounds under Article 263 TFEU they could bring any challenge, and whether they would be successful in obtaining any further remedy against the Commission. 

Answer rating: 100% (QA)

Locus standi under Article 263 TFEU refers to the right or standing to bring an action before the European Union courts In this case Michelangelo SA a... View the full answer