C-97/75

JUDGMENT OF THE COURT (FIRST CHAMBER) OF 24 JUNE 1976 1

F.C.L.M. Crijns v Commission of the European Communities

Case 97/75

Summary

Officials — Rationalization of departments consequent upon the Accession Treaty — Scheme for the termination of service of officials — Allowance — Aggregation with income accruing from new employment — Calculation in accordance with Article 3 (4) of Regulation No 2530/72 — Family allowances excluded

It appears from the combination of national legislation and those granted by Article 67 (2) of the Staff Regulations of the Community, are exempt from the Officials and Article 3 (4) and (5) of calculation provided for in Article 3 (4) Regulation No 2530/72 that family of Regulation No 2530/72 and are the allowances, both those granted under subject of special non-aggregation rules.

JUDGMENT OF 24. 6. 1976 —CASE 97/75

Application for the annulment of the decision of the Commission of 22 October 1974, concerning the calculation of the allowance due under the first indent of Article 3 (1) (b) and under Article 3 (4) of Regulation (Euratom, ECSC, EEC) No 2530/72 of the Council of 4 December 1972, as well as the annulment of the decisions rejecting the complaint made in that respect.

THE COURT (First Chamber)

composed of A. O'Keeffe, President of Chamber, J. Mertens de Wilmars and F. Capotorti, Judges,

Advocate-General: J.P. Warner Registrar: A. Van Houtte

gives the following

to a monthly allowance equal to 80 % of their basic salary and lastly for a third The Court (First Chamber), after hearing period ceasing at the age of 65 years, to the report of the Judge-Rapporteur and the views of the Advocate-General, an allowance equal to 70 % of that salary. decided to open the oral procedure without any preparatory inquiry. Paragraph 4 of the same article however enables a limit to be placed on the II — Conclusions of the parties aggregation of the allowance thus calculated with income accruing to the The applicant claims that the Court persons concerned from any new should: employment. To the extent to which the '1. Hold that the allowance in question allowance and this income, aggregated in Article 3 (4) of Regulation No together, exceed the total remuneration, 2530/72 of the Council, of 4 as it would be had he continued in the December 1972, is the allowance service, the Community allowance is mentioned in the first indent of reduced so that the total is brought down Article 3 (1) (b) of this regulation and to the level of that total remuneration. that this allowance represents a part Lastly, according to Article 3 (5) all of the basic salary, to the exclusion of family allowances provided for by the family allowances. Staff Regulations of officials shall remain 2. Hold also that family allowances from other sources which are mentioned in payable but Article 67 (2) of the Staff Regulations governing family allowances Article 3 (5) of Regulation No shall apply according to the 2530/72 and in Article 67 (2) of the circumstances. Staff Regulations of Officials of the European Communities, are governed After receiving an allowance equal to his by the non-aggregation rule laid last remuneration during the first year, down in the said Article 67 (2) and the applicant was informed by letter that these family allowances do not from the Commission of 22 October constitute new income within the 1974 of the calculation which would be meaning of Article 3 (4) of used for the allowance which was due to Regulation No 2530/72. him for the following period, that is to 3. Annul the decision or the defendant

III — Submissions and argu salary, family allowances and other ments of the parties allowances'. On the other hand paragraph (5) of the same Article 3, A — According to the applicant the referring to Article 67 (2) of the Staff calculation set out in the Commission's Regulations, lays down a special system letter of 22 October 1974 as regards the of non-aggregation regarding family aggregation of the allowance provided for allowances received through the in Article 3 (1) (b) of Regulation No Community with those received from 2530/72 with the income received from elsewhere. the new employment, infringes the first indent of Article 3 (1) (b) and Article 3 The Commission was therefore not (4) and (5) as well as Article 62 — entitled, in order to calculate the especially the third paragraph, and allowance for the purposes of applying Article 67 — especially the second Article 3 (4), to take account only of the paragraph, of the Staff Regulations of basic salary, as adjusted by the weighting Officials. and it is necessary to delete from the

The result would have income plus that allowance exceeds the been an allowance of BF 73 125 instead total remuneration last received by the of BF 78 970. Added to the new income official in the performance of his duties. that allowance would exceed the last total That remunerations shall be weighted as remuneration only by BF 100 and not by provided in paragraph 3.' BF 12 103, as appears from the calculation made by the Commission. 1. The applicant claims in the first place that the Commission infringed this 2. According to the applicant his point provision by including — in order to of view is confirmed, furthermore, by the apply the rule reducing aggregations — fact that in interpreting Article 3 (4) and in the allowance granted by the (5) as it does, the Commission takes Community, the family allowances account of Community family allowances granted by the latter and in the (dependent child allowance) which are calculation of income accruing from new not in fact paid, precisely as a result of employment, the family allowances the application of the combined received by virtue of that employment, provisions of Article 3 (5) of Regulation when the inclusion of these family No 2530/72 and Article 67 (2) of the allowances is excluded by Article 3 (4) Staff Regulations, because of the fact that which refers only to the allowance the applicant receives an allowance of mentioned in paragraph (1) (b) (80 % of the same character in the Netherlands. the basic salary) and the actual 'income' Further, it applies to the same class of received from the new employment.

CRIJNS v COMMISSION

non-aggregation rule in Article 3 (4). in paragraph 1 (b) and therefore does not Lastly, to regard 'family allowances from include family allowances. The other sources' as 'income accruing to the Commission points out that the family official concerned from any new allowances in the system of the Staff employment' within the meaning of Regulations, for example in Article 81, Article 3 (4) is illegal because of the fact often represents a percentage of the basic that the legal provisions in force in the salary. It is of the opinion that since the Netherlands take account not of the allowance referred to in Article 3 (1) (a) actual number of children, but of a tax actually and undeniably includes family figure. allowances, it could hardly be otherwise as regards the allowance mentioned in B — In its defence, the Commission paragraph (1) (b). The general structure of replies that in order to interpret Article 3 this article, furthermore, shows clearly (4) of Regulation No 2530/72 correctly, that it was intended to grant an this provision must be seen in the allowance corresponding, during the first context of the whole of this regulation. year, to the whole basic salary increased The said paragraph (4) takes its by all the allowances and during the inspiration from Article 5 (4) of following period, to a decreasing Regulation No 259/68 of the Council of percentage of the basic salary increased 29 February 1968 (OJ, English Special by family allowances. The final Edition 1968 (I), p. 30) which at the time calculation of the amounts due to the of a previous operation reducing the applicant is based on a comparison number of staff also laid down a ceiling which would be impossible if the three for the allowance to be paid to an official factors in that comparison did not who had opted for 'voluntary termination include the same essential components, of service and who received income including the family allowances. from his new employment and indicates the intention of the legislature clearly. The fact that the allowance referred to in

JUDGMENT OF 24. 6. 1976 — CASE 97/75

2. The concept of 'total income' used second place does not correspond to the by the Commission for the purposes of interpretation which the Commission the comparison which it made, is not to gives to it and is contradicted by the be found in Regulation No 2530/72. wording. Community legislation clearly intended to grant, for the first year, an Article 3 of Regulation No 2530/72 uses allowance equal to the last remuneration only the following concepts: (basic salary + family allowances + (a) the total remuneration last received, allowances) and for the following periods, which is both the sum paid monthly a percentage of the basic salary.

The (Article 3 (1) (a) and (4). Community legislature wished precisely (b) The monthly allowance paid after the to avoid that illogical consequence by first year and which corresponds to a including in the calculation of the percentage of the weighted basic aggregation laid down by Article 3 (4) salary (Article 3 (1) (b) and (3)). only the actual interim allowance and by (c) Other allowances: family allowances providing a special system of (Article 3 (5), allowances under the non-aggregation for family allowances. social security scheme (Article 3 (6)), the retirement pension, in certain 5. The applicant further disputes the circumstances (fifth subparagraph of usefulness of the comparison suggested Article 3 (7) and family allowances, if by the Commission between Article 3 (4) the former official is entitled to a of Regulation No 2530/72 and Article 5 pension before the age of 60 (Article (4) of Regulation No 259/68, which is 3 (8)). not in question in the present case. (d) Income received by the person concerned from any new 6. The applicant lastly draws attention employment, aggregated with the to the fact that the Commission allowance referred to under (b). contradicts its own argument when it applies it. In fact in the contested

CRIJNS v COMMISSION

paragraph under (a). Lastly, the weighting (a) that the monthly allowance included which was applied only at 80 % of the in the calculation under Article 3 (4) basic salary should, according to Article 3 of Regulation No. 2530/72 does not (3), also have affected the dependent include family allowances; child allowance and the education (b) that the income accruing to the allowance. official concerned from any new employment' does not include 7. The applicant also disputes the the dependent child allowance Commission's argument that the family (kindertoelage) paid in the allowances which the applicant receives Netherlands. from his new employment are actually received by him and therefore form part The Commission observes that the 'total of his new income. Family allowances are remuneration last received' is not limited not remuneration for an occupational only to the basic salary, increased by activity, but constitute an allowance family allowances.

allowances do not constitute taxable the ceiling for the application of the income and, lastly, from the position of non-aggregation rule is higher since the the applicant with regard to Netherlands total remuneration last received includes law. family allowances. 8. The Commission's argument that family allowances in the system of the As regards the fact that family allowances Staff Regulations, for example in Article received in the Netherlands are not part 81, often represent a percentage of the of the 'income accruing from any new basic salary, is irrelevant and, in fact, employment', the Commission considers confirms that the basic salary does not that the context of Article 3 (4) of include family allowances without which Regulation No. 2530/72 the 'new these would be calculated on their own income' refers to income received prior basis. to service with the Communities and, as such, includes family allowances.

JUDGMENT OF 24. 6. 1976 — CASE 97/75

Communications Nos. 1186/74 and very character of family allowances is, 1687/IX/73 are not conclusive. A furthermore, different in the Member department of the Commission has not, States. any more than the Commission itself, jurisdiction to give an authentic The Commission also rejects the interpretation of a Council regulation. applicant's statement that in the The reference in document IX/1186/74 Netherlands 'kindertoelage' does not to 'income paid as remuneration for form part of income. occupational activity', refers only to the exclusion of occasional income or During the oral procedure on 21 May income derived from personal assets. It is 1976, the parties expounded the not possible either to draw conclusions, arguments they had put forward during as regards the inclusion of family the written procedure. allowances in the salary, from the fact that under Regulation No. 2530/72 they The Advocate-General delivered his are exempted from Community tax. The opinion at the hearing on 16 June 1976.

Law

1 The application is for the annulment of the Commission's decision of 22 October 1974 and, so far as is necessary, of the implied decisions of rejection of the applicant's complaint.

2 The applicant, a former official of the Commission, has benefited since 1 July 1973, the date on which his service was terminated, from the provisions of Regulation (Euratom, ECSC, EEC) No 2530/72 of the Council of 4 December 1972, OJ, English Special Edition 1972 (1-8 December), p. 11) which, by reason of the accession of new Member States, establishes special measures concerning the recruitment of new officials and the termination of service of certain officials of the Communities.

4 Paragraph (4) of this same article provides however that The income accruing to the official concerned from any new employment during this period shall be deducted from the allowance provided for in paragraph (1) (b) in so far as that income plus that allowance exceeds the total remuneration last received by the official in the performance of his duties, such last remuneration being determined on the basis of the table of salaries in force on the first day of the month for which the allowance is payable

5 The last monthly total remuneration of the applicant was BF 119 281.

6 Since 1 September 1973, the applicant has worked as a scientific associate in the Law Faculty of the 'Katholieke Hogeschool' at Tilburg, in the Netherlands.

7 By the contested decision of 22 October 1974, the Commission informed him of the calculation which it had made pursuant to Article 3 (4) quoted above, in order to establish the deductions to be made from the allowance payable to him as from the beginning of the second year following the termination of his service.

8 According to this calculation that reduction amounts to BF 12 103 per month.

9 The complaint is made that the Commission has, in adding the allowance for termination of services and the income accruing from his new employment, for the purposes of comparing their total with his total remuneration last received, included in that allowance the Community family allowances to which the applicant is entitled under Article 3 (5) and included in that income the family allowances which are granted to him under the legislation of the Netherlands.

12 According to the Commission, it follows from the fact, which is not disputed, that the monthly allowance granted during the first year since the termination of service includes family allowances, that the same is necessarily true in respect of the allowance granted during the following period.

13 It adds that any other method of calculation would be incompatible with the non-aggregation rule set out in Article 3 (4) the object of which is precisely to prevent the person concerned from receiving from the budget of the Community institutions an income exceeding the amount of his total remuneration last received.

14 It refers, further, to the system adopted at the time of the first scheme of voluntary resignations, in 1968, by Regulation No 259/68, from which Regulation No 2530/72 took its inspiration and which included family allowances in the allowance called allowance for voluntary termination of service.

15 In the same way, as regards the calculation of the amount of income received by the person concerned in his new employment, that term must be interpreted by reference to the income accruing in the preceding employment, that is to say, the remuneration received as an official which without any possible doubt includes family allowances.

16 In a general way, the calculation laid down in Article 3 (4) can logically be made only to the extent to which two expressions to be added together, that is to say, 'income accruing from any new employment' and 'the allowance provided for' have the same content as the expression with which their addition must be compared, that is to say, 'the total remuneration last received', which includes family allowances.

22 Article 3 (5) of Regulation No 2530/72 provides that the whole of the family allowances are due to the official who receives the allowances provided for in paragraph (1).

23 That provision adds, however, that the provisions of Article 67 (2) of the Staff Regulations, that is to say, the special rules regarding the aggregation of Community and national family allowances, apply.

24 It appears from the combination of these provisions that family allowances, both those granted under national legislation and those granted by the Community, are exempt from the calculation provided for in Article 3 (4) and are the subject of special non-aggregation rules which, moreover, are applicable in the present case.

25 The argument of the Commission founded upon the fact that 'total remuneration last received' includes family allowances cannot invalidate the conclusion based both on the express wording of paragraph (2) and the system of Article 3 which includes a special non-aggregation rule for family allowances.

JUDGMENT OF 24. 6. 1976 — CASE 97/75

26 In fact this apparent lack of logic is corrected by the fact that, by applying Article 67 (2) of the Staff Regulations of Officials, an aggregation of family allowances is excluded in any case.

THE COURT (First Chamber)

hereby:

1. Annuls the decision of the Commission of 22 October 1974;

2. Orders the defendant to bear the costs.

O'Keefe Mertens de Wilmars Capotorti

Delivered in open court in Luxemburg on 24 June 1976.