C-19/76

2. Social security for migrant workers — Rights acquired under the legislation of only one Member State — Guarantee — Measures of the Council pursuant to Article 51 of the EEC Treaty — Choice — Means justified — Inequalities between workers due to disparities between the national schemes in question — Possibility — Acceptability

1. Article 42 (2) of Regulation No 3 as virtue only of the legislation of the amended by Article 1 of Regulation Member State in which he has No 1/64 of the Council concerning worked, no provision of the Treaty the right of beneficiaries of a pension restricts the freedom conferred on the due in pursuance of the legislation of Council by Article 51 to choose any several Member States to family means which, viewed objectively, are allowances is valid. justified, even if the provisions adopted do not result in the 2. Although the measures taken by the elimination of all possiblity of Council pursuant to Article 51 must inequality between workers arising by not have the effect of depriving a reason of disparities between the migrant worker of a right acquired by national schemes in question.

In Case 19/76

Reference to the Court under Article 177 of the EEC Treaty by the Cour de Cassation of Belgium for a preliminary ruling in the action pending before that court between

1 — Language of the Case: French.

JUDGMENT OF 13. 7. 1976 — CASE 19/76

composed of: R. Lecourt, President, H. Kutscher and A. O'Keeffe, Presidents of Chambers, J. Mertens de Wilmars, P. Pescatore, M. Sørensen and Lord Mackenzie Stuart, Judges,

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

gives the following

JUDGMENT

Facts

The order for reference and the written He became disabled, and from 1960 observations submitted under Article 20 onwards was entitled to two invalidity of the Protocol on the Statute of the pensions: one under Belgian legislation Court of Justice of the EEC may be and the other under Italian legislation. summarized as follows: He also received family allowances from the Caisse de compensation de la région I — Facts and procedure liégeoise, until his departure for Italy in 1962, and again from 1 February 1964 to Mr Triches, an Italian national, worked 31 March 1969, while the Italian State in Italy in the building industry from Insurance Scheme paid him a 1938 to 1945 and then was a mine supplement to his pension on the basis worker in Belgium from 1946 to 1960. of his family responsibilities.

The Fund came to the conclusion that 'the validity of Article 42 (2) of on the basis of Article 42 (2) of Regulation No. 3 of 25 September 1958, Regulation No 3, as amended by Article as amended by Article 1 of the 1 of Regulation No 1/64 of 18 December Regulation of 18 December 1963, now 1963 (JO 1964, p. 1) which, since repealed, and in particular on the February 1964, contains the law compatibility of the abovementioned applicable to the granting of family Article 42 (2) with Articles 3, 48, 51 and allowances to beneficiaries of a pension, 117 of the Treaty in that the effect of this it had no obligation to pay family provision was to create inequalities allowances to Mr Triches after that date, between workers which constituted an and asked him to make a repayment. obstacle to the free movement of persons'.

their pension . . .'. assisted by I. M. Braguglia, Deputy State Advocate-General, and the Commission of the EC, represented by its Legal Mr Triches refused to make the Adviser, Miss M. J. Jonczy, acting as repayment demanded and the case came Agent, submitted written observations before the Cour du Travail, Liège. Mr pursuant to Article 20 of the Protocol on Triches argued before the court that the the Statute of the Court of Justice of the provisions of Article 42 (2) were not valid EEC. and could not be applied because they created inequalities of treatment and Upon reading the report of the were therefore incompatible with Articles Judge-Rapporteur, and upon hearing the 2, 48, 51 and 117 of the EEC Treaty. In a Advocate-General, the Court decided to judgment of 11 September 1973, the open the oral procedure without any Cour du Travail, Liege, rejected this prior preparatory inquiry. submission and decided that Mr Triches could not, in addition to the supplement to his pension which had been granted II — Summmary of the written to him in Italy, receive the difference observations between that supplementary pension and the amount of the family allowances Mr Triches denies the validity of Article payable under Belgian legislation. 42 (2) of Regulation No 3 in that its provisions are incompatible with: Mr Triches appealed against this (a) Articles 3 (c) and 48 (3) (b) of the EEC judgment to the Cour de cassation, Treaty: which, by judgment of 4 February 1976, He claims that the practical decided to stay its proceedings and to application of Article 42 (2) has the make a reference to the Court of Justice effect of depriving certain migrant under Article 177 of the EEC Treaty for workers of a part of their rights.

JUDGMENT OF 13. 7. 1976 — CASE 19/76

movement of persons within the the Court were to extend its Community, by encouraging interpretation to this provision. beneficiaries of a pension to remain in the territory of the State which The Belgian Government argues first gives them the most favourable that Article 42 does not base the benefits; determination of the legislation (b) Article 51 (b) of the EEC Treaty, applicable on nationality. The criterion which according to him ensures that of country of residence is the most the payment of benefits to which convenient solution because expenditure entitlement has arisen in one on education for the children can best be Member State shall be payable in the evaluated in the country where the territories of the other Member States; members of the family reside and in (c) Article 117 of the EEC Treaty: which the family allowances must be He further claims that it is apparent used.

TRICHES v CAISSE LIÉGEOISE FOUR ALLOCATIONS FAMILIALES

It is a fundamental rule of Community States often had to pay very trivial law on social security that pension benefits out of all proportion to the benefits may not be reduced, suspended, administrative costs involved. or altered by reason of the fact that the beneficiary resides permanently in a Under the system introduced by country other than the one where the Regulation No 1/64, the right to family institution liable for payment is situated. allowances, to which supplements or increases in pension for dependent Finally, it is argued, the fact of having children are assimilated, is determined by worked in several Member States cannot, reference to the legislation of only one without infringing Article 48 of the country, and according to criteria Treaty, entail a loss vis-à-vis those who analogous to those used for the granting of benefits in the nature of sickness have worked in only one Member State. insurance for beneficiaries of pensions: if the worker is the beneficiary of a pension The Commission points out first of all in pursuance of the legislation of one that there can be no question of the Member State only, it is the legislation of validity of Article 42 (2) of Regulation that Member State which is applicable; if No 3 as regards Articles 3 and 117 EEC. the worker is the beneficiary of a pension This is because the Court has repeatedly in pursuance of the legislation of several asserted that the regulations on social Member States, it is the legislation of the security are founded on, governed by and country of permanent residence which is limited by Articles 48 to 51 of the EEC applicable when the worker is the Treaty and also because Article 3 of the beneficiary of a pension payable by that Treaty, which defines the activities of the country, and it is the legislation of the Community, refers to the said articles, Member State in the territory of which and because Article 117 of the Treaty is the worker has completed the longest outside the context of freedom of old-age insurance period which is movement. applicable when the worker is permanently resident in the territory of a In its original form Article 42 (2) Member State other than those States

case up to the amount of family footing as the Italian invalidity pension allowances or pension supplements in itself, and the Belgian family allowances. respect of children payable under the When he returned to Italy, his right to legislation of the country of permanent the transfer of the Belgian family residence, or up to the total amount of allowances became subject to the those benefits if the said legislation application of Article 42 (2) of provided for the simultaneous payment Regulation No 3. This meant that the of both kinds of benefits. The said allowances could not exceed the determination of the amount of the amount representing the Italian pension family allowances to be transferred by supplement for accounting purposes and the competent State was extremely had to be calculated within the limits complicated, and caused considerable fixed by Article 70 (6) of Regulation No delays in the payment of benefits because 4, that is to say, this amount could not be they had to be recalculated frequently higher than the Belgian family and the final result was that Member allowances less the Italian pension

JUDGMENT OF 13. 7. 1976 — CASE 19/76

supplement actually paid, or than the Nevertheless in certain cases Article 42 Italian pension supplement for (2) might result in a worker entitled to accounting purposes less the Italian claim benefits under the legislation of pension supplement actually paid. several countries receiving the benefits Therefore the Belgian Fund could only payable under the least favourable be exonerated from all payments of legislation, and might be contrary to family allowances to Mr Triches if the Article 51 of the EEC Treaty. But such amount resulting from one of the two an assertion might be subject to calculations described above was equal to reservations. The simultaneous ap­ zero. plication of the legislation of two or more countries would lead to a more

TRICHES v CAISSE LIÉGEOISE POUR ALLOCATIONS FAMILIALES

Law

1 By order of 4 February 1976, which reached the Court on 23 February, the Cour de cassation of Belgium has referred a question under Article 177 of the EEC Treaty on the validity of Article 42 (2) of Regulation No 3 of the Council concerning social security for migrant workers (JO No 30 of 16. 12. 1958, p. 561), as amended by Article 1 of Regulation No 1/64/EEC of the Council of 18 December 1963 (JO No 1 of 8. 1. 1964, p. 1), now repealed, and in particular on the compatibility of the said Article 42 (2) with Articles 3, 48, 51 and 117 of the EEC Treaty.

2 This question has been raised in relation to a dispute concerning the right of an Italian national to family allowances. He is the appellant in the main action. He worked first in Italy from 1938 to 1945 and then in Belgium from 1946 to 1960. He became disabled during this latter time, and he is entitled to two invalidity pensions, one under Belgian legislation and the other under Italian legislation.

3 Article 42 (1) of Regulation No 3 as amended by Regulation No 1/64 provides that: 'Beneficiaries of a pension due in pursuance of the legislation of one Member State only, and who permanently reside in the territory of another Member State are entitled to family allowances in accordance with the provisions of the legislation of the country liable for payment of the pension as though they were permanently resident in that country.'

4 As regards beneficiaries of pensions due under the legislation of several Member States, Article 42 (2) provides that they 'are entitled to family allowances in accordance with the legislation

7 According to the provisions of the last subparagraph of Article 42 (2), the appellant in the main action is entitled to the Italian pension supplements for children calculated in accordance with the provisions of Article 28 of Regulation No 3, but without apportionment.

8 Since the said supplements did not appear to be so high as the Belgian family allowances, the appellant in the main action has contested the validity of the new Article 42 (2) of Regulation No 3.

9 He argues that this provision is incompatible with Articles 3, 48, 51 and 117 of the EEC Treaty, in that the effect of it is to create inequalities between workers, which constitute an obstacle to the free movement of persons within the Community.

10 It is argued that the effect of the said Article 42 (2) is that by comparison with an Italian worker who has only worked in Belgium, a worker who has worked in Italy and in Belgium is placed at a disadvantage because upon returning disabled to their country of origin, the first receives the Belgian family allowances, and the second only receives the Italian pension supplement for children.

TRICHES v CAISSE LIÉGEOISE POUR ALLOCATIONS FAMILIALES

11 Article 3 of the EEC Treaty provides that the activities of the Community shall include inter alia the abolition of obstacles to freedom of movement for

14 The wording of the first paragraph of Article 117 is as follows: 'Member States agree upon the need to promote improved working conditions and an improved standard of living for workers, so as to make possible their harmonization while the improvement is being maintained.'

15 It is settled that Belgian legislation alone does not give any right to Belgian family allowances to a worker who, having worked in Belgium, becomes disabled and leaves Belgium to return to his country of origin.

16 The provisions at issue have the effect of ensuring that the period of work in Belgium shall be taken into account without apportionment when the amount of the Italian pension supplement for children is calculated.

17 As appears from the first recital to Regulation No 1/64, Article 42 of Regulation No 3 in its earlier form had proved too complicated to apply. The purpose of the new Article 42 was, therefore, to simplify the system for co-ordinating family allowances, and to ensure, so far as possible, that migrant workers receive the payments to which they would have been entitled if they had worked in only one Member State.

JUDGMENT OF 13. 7. 1976 — CASE 19/76

18 Although the measures taken by the Council pursuant to Article 51 must not have the effect of depriving a migrant worker of a right acquired by virtue only of the legislation of the Member State in which he has worked, none of the aforementioned provisions of the Treaty restricts the freedom conferred on the Council by Article 51 to choose any means which, viewed objectively, are justified, even if the provisions adopted do not result in the elimination of all possibility of inequality between workers arising by reason of disparities between the national schemes in question.

Consideration of the question raised has disclosed no factor of such a kind as to affect the validity of the provision at issue.

Lecourt Kutscher O'Keeffe

Mertens de Wilmars Pescatore Sørensen Mackenzie Stuart

Delivered in open court in Luxembourg on 13 July 1976.

A. Van Houtte R. Lecourt

Registrar President