C-2/67

1. Procedure — Preliminary ruling — Jurisdiction of the Court — Limits (EEC Treaty, Article 177)

2. Free movement persons — Migrant workers — Insurance — Benefits — Pro­ of portional calculation as a corollary of aggregation

(EEC Treaty, Article 51)

3. Free movement of persons — Migrant workers — Insurance — System provided for by Regulation No 3 — Retention of separate national systems and of separate claims

4. Free Migrant workers — Old-age death (pensions) of persons and — movement

insurance — Pension rights relating to separate periods — Absence of improper accumulation

European Economic Community by the Cour Supérieure de Justice, Luxem-

1 — Language of the Case: French. 2 — CMLR.

JUDGMENT OF 5. 7. 1967 — CASE 2/67

bourg, sitting as a Cour de Cassation, for a preliminary ruling in the appeal pending before that court between

Augusts de Moor , commercial traveller,

and

composed of A. Trabucchi, President of Chamber, President, R. Monaco, President of Chamber, A. M. Dormer, R. Lecourt (Rapporteur) and W. Strauß, Judges,

Advocate-Gneral: K. Roemer Registrar: A. Van Houtte

gives the following

JUDGMENT

Issues of fact and of law

of Regulation No 3 of the EEC. When I — Facts and Procedure he attained the age of 65 on 24 January 1958, he could claim a pension in Bel­ Mr Auguste de Moor, a commercial gium solely under the national law of

Luxembourg calculated the pension in bourg social security institution to cal­

accordance with Article 28 of Regula­ culate his pension by applying Luxem­

tion No 3 which lays down in para­ bourg law only without reference to the graph (1) the conditions for the pay­ insurance periods completed under the

ment of may foe claimed benefits which laws of other Member States. The Caisse Con­ by 'an insured person covered by Article rejected this request. The 27' if he has completed insurance seil Arbitral des Assurances Sociales (the periods in a number of Member States, Arbitration Board for Social Security) his pension being calculated in such on the other hand granted his applica­

27 November 1963. The Con­ cases by a proportional calculation of tion on

the various insurance periods. seil Supérieur des Assurances Sociales When he applied for a pension the (Social Security Court), however, periods of insurance were 7 years and 6 quashed this decision on 5 December months in Germany, 14 years 9 months 1964. in Belgium and 10 years in Luxem­ When Mr de Moor appealed, the Cour bourg. The Luxembourg pension was Superiéure de Justice, Luxembourg, calculated by a proportional calculation finding that the interpretation of Regu­ of these periods, because the right to lation No 3 was an issue 'between the

to the proportion which his insurance termining the amount of old-age pen­

period completed in Luxembourg repre­ sions payable by the Caisse de Pension sented in relation to the aggregate of des Employés Privés in Luxembourg, the periods of insurance under the laws even in those cases where its applica­

of the three Member States. As the tion would not lead to the acquisition, Luxembourg pension consisted partly maintenance or recovery of the right to of a fixed sum, the amount of which benefit referred to in Article 27 (1) of

is independent of the length of time the said Regulation No 3 and, in addi­ during which contributions were paid, tion, whether Article 28 of Regulation and partly of a sum which is pro­ No 3, if it is regarded as being applic­ duration insur­ portionate to the of the able without distinction even in cases

ance period, the proportional calculation other than the acquisition, maintenance of the pension adopted by the Caisse or recovery of a right to benefit, is in produced a pension which was lower conformity with the provision upon

than it would have been, had only the which the said article is based, that is

In accordance with Article 20 of the cedure. Its submissions in support of

Protocol on the Statute of the Court of this application were intended to per­

Justice the parties to the appeal before suade the Cour Supérieure to request

the Cour Supérieure de Justice, Luxem­ the Court of Justice to stay the pro­

bourg, the Commission of the EEC and ceedings for preliminary ruling 'until a

the Member States were invited to sub­ the application for the restoration of the

reasoned oral opinion at the hearing on by Community law but by Belgian law. 1 June 1967. The Caisse states that although Article 28 (1) (e) and (f) provides for 'the possibility of disregarding certain II — Observations submit­ insurance' periods of this may be done ted under Article 20 only where the claimant does not com­

of the Protocol on the ply with 'the conditions for the acquisi­

Statute pension'

tion of the right to a under

the legislation applying to such periods. The jurisdiction of the Court of Justice This is not the position in the present

The Caisse de Pension des Employés case. In fact the right of the claimant

suffered from a serious defect, because cision of the claimant, is not a con­

the disputed pension was a charge partly stituent part of the right.

on the funds of the Caisse and partly This interpretation of a point of foreign on the funds of the body responsible law, arrived at by the Conseil Supér­

for insurance against and dis­ ieur des Assurances Sociales and there­ old-age

ablement which was 'made a third party fore final, is a finding of fact which the to the proceedings by the national court Cour Supérieure is not entided to re­

of first instance of its own motion'

Further, there can be no question of a has been made to the Court of

migrant worker's being subjected to a Justice, the Commission has found in disadvantage or gaining a privilege in the order of reference and the opinion

'the [Attor­ cases where situation of the claim­ of the Procureur General d'État ant only depends upon his own con­ ney General] 'indications that the court

duct'. making the reference intended to treat

Finally since the content of national the question as one of interpretation'. laws plays a decisive part in the solu­ In order to determine the validity of

tion of the legal problem the Court of Article 28 of the regulation with refer­

courts to acknowledge that his ceasing meaning compatible with Article 51. to be gainfully employed was not a This explains the importance of the

condition for the payment but a con­ judgment in Case 4/66 (Rec. 1966, p. dition for the acquisition of his right to 625) which held that Articles 27 and 28 Belgian The Conseil Supér­ 'like a pension. the entire system of which they ieure des Assurances Sociales expressly form part have as their basis, their

referred to the possibility of disregarding framework and their bounds Articles 48 certain insurance periods. to 51 of the Treaty, which are aimed

The applicant and the Cour Supérieure at securing freedom of movement for thought that they were faced with a workers'.

question of the interpretation of a point The file and in particular the opinion

of foreign law. As this question had of the Procureur General show that it been determined by the lower courts, is not the validity of Article 28 which

in addition to refer to the Court The Caisse de Pension only dealt with of Justice a 'request for the determina­ this question in the alternative and left validity'

Article 28. How­ decision tion of the of the as to the content of the

ever, as 'no express application for the request for an interpretation to foe de­

determination of the validity (of Article termined by the court.

JUDGMENT OF 5. 7. 1967 — CASE 2/67

It calls attention, however, to the effect ers if, merely by exercising this freedom, which the interpretation advocated by they were to lose their entidement to

benefit is at issue'. Article 28 of Regulation No 3 but per­

The Cour Supérieure, Luxembourg, was haps permits 'a general procedure for of the opinion that having regard to determining pensions on the basis of

the particular facts of the dispute the proportional calculation within the

relationship between the framework cal­ question of the of other methods of

acquisition of the right (Article 27) and culating pensions'. If the need to pro­

the proportional calculation of the pen­ tect the worker means that Articles 27 sion had not been sufficiently clarified. and 28 of the Regulation must be ap­

would not be need to aggregate periods. As, however, attained but disregarded, if a migrant the right to a pension in Germany could worker were obliged, in order to avail only be acquired by aggregation, the

himself of the freedom of movement Luxembourg institution could calculate

which is guaranteed to him, to find its own pension on a proportional basis, himself subjected to the loss of rights because it is not clear from the judgment already acquired without having them in Case 100/63 that proportional calcula­

replaced by at least equivalent benefits. tion is subject to aggregation only in the Finally Articles 27 and 28 'would not country where the pension is calculated.

guarantee the free movement of work- It is right that Article 28 should be ap-

DE MOOR v CAISSE DE PENSION

mentary allowances paid by the institu­ sible in the present case to achieve this

tions to those States to make good any object without prejudicing the worker

possible disadvantages'. This is the 'it is necessary to that Regulation state'

weak­

ness of Regulation No 3 which does not No 3 does not make it possible in every allow compensation in every case for the case for the two principles, which the

loss of rights suffered by a worker Commission considers are to be inferred through the proportional calculation of from the case-law of the Court, to foe pensions under the legislation of certain complied with simultaneously.

doubt' plurality 'without any in sulting from the adding together of pen­ a exists

the present case, it proposes to make an sion rights acquired in the normal way allowance for the benefits to which Mr in each Member State solely under their de Moor is not entided. It takes the view respective national laws, the Commis­

in fact that there is an improper plurality sion compares the old-age pension with

of benefits 'when the pensions are not the Belgian or French pension which is entirely proportionate to the period of granted after a short qualifying period. insurance' but are either fixed at a flat Finally it relies on the spirit of Regula­ rate (as they are in the Netherlands) or tionNo 3 as expressed in Article 11 (1) unconnected with the insurance periods relating to the plurality of benefits which (as are Type A invalidity pensions, re­ states that, save for exceptions, of which ferred to in Article 24 of Regulation No old-age/death insurance is one, Regu­ 3, under Belgian, French and Nether­ lation No 3 cannot confer "entitlement lands law). The same situation arises 'al­ under the legislation of the Member degree' though to a lesser in the case of States, to more than one benefit of the pensions which, like those governed by same kind in respect of any insurance Luxembourg law, are made up of an period".

JUDGMENT OF 5. 7. 1967 — CASE 2/67

The case where benefits of the same 28 (1) (e) and (f) of Regulation No 3 kind do not exist concurrently is easier is different from the preceding question, to understand if the difference between because, as the Commission believes, in­ private insurance (in particular life 'the principle of proportional calculation surance) and social security is examined. of the Luxembourg pension was justi­

are the same in private insurance. be gainfully employed, he suffers a re­

only These are the various considerations duction of the total amount of his pen­

Commission to prepare sions—a loss which is justified under which caused the

a draft regulation after it has been Belgian law. He would suffer, on the and, issued, 'the general application of pro­ other hand, an unjustified if, for loss

portional calculation'

will be obligatory. the same reason, the Luxembourg pro­

bourg institutions the right to disregard sion consisting partly of a fixed amount

the Belgian insurance periods. This would lead to a reduction in the amount question of the interpretation of Article of the pension in a case such as this.

Grounds of judgment

By judgment of 5 January 1967 lodged at the Court on 23 January 1967 the Cour Supérieure de Justice of Luxembourg, sitting as a Cour de Cassation, asked 'whether Article 28 (1) (b) of Regulation No 3 of the Council of the

EEC of 25 September 1958 concerning social security for migrant workers is applicable for the purpose of determining the amount of old-age pensions

-204

conferring the right to a pension after payment of contributions for a con­

siderable time deals with any effect on the worker's rights of insurance periods completed in three Member States leading first to the acquisition by him in Luxembourg of a right to a pension solely under its national law, secondly to the acquisition by him in Belgium solely under its national law of a right to a pension payable only when he ceases to be gainfully employed and finally to the acquisition by him in West Germany of the right to a pension as the result of aggregating insurance periods as provided by Article 27 of Regulation No 3.

The jurisdiction of the Court

The Caisse de Pension des Employés Privés du Grand-Duché criticizes the

judgment of the said court, challenges the jurisdiction of the Court of Justice to give a ruling on the question referred and maintains that it is a Belgian law and not Community law which has to be interpreted.

However as the Court has been properly seised under Article 177 of the

Article 28 (1) of Regulation No 3 which the Court is asked to interpret pro­

for determination (sub­ vides the by the method of proportional calculation

paragraph (b)) of the 'benefits which may be claimed by an insured person covered by Article 27 ... or his survivors'.

The question which has been raised is whether this method is applicable in a state where the right to a pension has already been acquired solely under its national legislation and consequently the where aggregation of insurance periods provided by Article 27 (1) does not apply.

The subsidiary question whether these provisions are in conformity with Article 51 of the Treaty, which arises out of the main question, cannot be severed from the interpretation requested, since Regulation No 3 has as its

basis, its framework and its bounds the requirements of Articles 48 to 51 of

The aim of Article 51 of the Treaty is not to secure in the first instance the equalization of social security institutions but to enable a benefits between

worker, who may lose the benefit of a period of contributions not long enough

to give him the right to a pension, to avoid such a loss by aggregation, only the concept of which is laid down by this Article. The method of proportional

calculation worked out by the implementing regulations based on this Article is, as it were, the corollary of aggregation in those cases where aggregation makes it necessary that the amount of the benefit should be calculated in accordance with a rule, without which it might be that this amount could not be determined. Proportional calculation is therefore an integral part of the

system of aggregation. No authority can be found in the Treaty, which does

not mention this concept, for the general application of proportional

the beneficiary has direct rights either under national law alone or national law supplemented, if necessary by the system of the aggregation of insurance periods provided for by Article 51 of the Treaty.

It is doubtful from the wording of Article 28 whether it aims at separating for which it insur­ proportional calculation provides from the aggregation of

periods upon which it is based and at ance making it generally applicable. This doubt cannot be resolved by a liberal interpretation which would more­ over be incompatible with the framework and bounds of Article 51 of the

Treaty.

It is argued that, with the intention of avoiding an improper plurality of benefits and guaranteeing an apportionment of pension obligations among in­ stitutions liable to pay benefits, Article 28 might be applied in one state

where Article 27 is not applicable, whereas it has to be applied in another

insurance period completed in the Member State in question, without taking into account in the calculation insurance periods completed in other Member States.

In pension systems based on insurance periods where a right to a pension is acquired after the completion of a minimum contribution period of a sub­

stantial length of time, the addition of this benefit to another benefit directly acquired in another Member State solely under its national law and based on

JUDGMENT OF 5. 7. 1967 — CASE 2/67

insurance periods completed in that state alone cannot be regarded as an

improper plurality of benefits.

These considerations are also valid even where the benefit which the insured person obtains as a result of the application of Article 27 in one state is higher than the loss which he would suffer if another state were to apply Article 28 without the need of recourse to Article 27.

Costs

The costs incurred by the Commission of the EEC which has submitted its observations are not recoverable, and as these proceedings are, in so far as the parties to step in the action pending before the main action are concerned, a

the Cour Supérieure de Justice of Luxembourg, the decision as to costs is a matter for that court.

On those grounds,

Upon reading the pleadings; Upon reading the report of the Judge-Rapporteur; Upon hearing the oral observations of the Commission of the EEC and the

THE COURT

in answer to the questions referred to it for a preliminary ruling by the judg­ ment of 5 January 1967 of the Cour Supérieure de Justice of Luxembourg sitting as a Cour de Cassation, hereby rules:

I. The introductory provisions and subparagraph (b) of Article 28 (I) of Regulation No 3 are not applicable for the purposes of determin­

ing the amount of an old-age pension based on a contribution period and acquired solely under national law without recourse to Article

27, unless the same contribution period is used at the same time to

determine the amount of other pensions in other Member States;

DELIVERED ON 1 JUNE 1967­ 1

Mr President, The plaintiff in the Luxembourg pro­

Members of the Court, ceedings during his working life was

a commercial traveller successively in The present proceedings initiated by a Germany, Belgium and Luxembourg and question from 'the Cour Supérieure de affiliated to the old-age insurance Justice of Luxembourg sitting as a schemes in each of those countries. Cassation' Cour de provides me for the When on 24 January 1958­ at —­ which

first time with the opportunity of giving time resident and working in the Grand my opinion on social security for mi­ Duchy of Luxembourg (Bertrange)—

grant workers, a somewhat obscure sub­ he attained the age of 65 and thereby ject which is difficult to grasp. reached the age limit under the laws