C-75/76

JUDGMENT OF THE COURT 10 MARCH 1977 1

Silvana Kaucic and Anna Maria Kaucic v Institut national d'assurances maladie-invalidité

(preliminary ruling requested by the Belgian Cour de Cassation)

Case 75/76

Social security for migrant workers — Invalidity insurance — Insurance periods completed — Benefits — Calculation — Theoretical amount — Reduction — National rule — Application where payment is made to the person concerned from a source outside the Community (Regulation No 3 of the Council, Article 11 (2), Article 26, Article 28; Regulation No 4 of the Council, Article 9 (2))

The provisions of Regulation No 3 of the person concerned would be entitled if Council of 25 September 1958 all the insurance periods had been concerning social security for migrant completed exclusively under the workers, and in particular Article 28 (1) legislation of that Member State, of a rule thereof, and of Regulation No 4 of the laid down under its own legislation in Council of 3 December 1958 do not order to reduce the theoretical amount preclude the application by the by the amount of a benefit received by institution of a Member State, when the person concerned from a source calculating 'for accounting purposes' the outside the Community amount of the benefit to which the

1 — Language of the Case: French.

JUDGMENT OF 10. 3. 1977 - CASE 75/76

on the interpretation of Articles 27 (1) and 28 (1) of Regulation No 3 of the Council of 25 September 1958 concerning social security for migrant workers (JO 1958, p. 561) regarding the right to draw invalidity pensions acquired, on the one hand, under the legislation of Member States of the EEC concurrently with those acquired, on the other, under the legislation of a third country,

THE COURT

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

Advocate-General: F. Capotorti Registrar: A. Van Houtte

aggregation insurance periods 2. Article 70. (2) of the Belgian Law of 9 completed in the Member States. August 1963 reads as follows: — A Member State which has entered into a bilateral convention with the The benefits provided for by this law third country shall calculate shall be granted only under conditions separately the proportionate amount determined by the King, if the incapacity payable within the framework of the in respect of which a claim for benefits is EEC and that payable within the made falls within the general law or framework of the bilateral convention some other legislation.

accordance with Articles 27 and 28 of p. 597). the said Regulation No 3 taking into account for the purposes of aggregation The articles in question read as follows: insurance periods completed in Italy and in Belgium. Article 11 of Regulation No 3 However the Institution deducted the amount of the Austrian pension from the '2. Provisions in the legislation of one Belgian allowance calculated 'for Member State for the reduction or accounting purposes', that is to say, the suspension of benefit where there is allowance to which the person concerned plurality with other social insurance would have been entitled if all the benefits, or other income, or because of insurance periods or assimilated periods gainful employment, shall apply to a aggregated in accordance with the beneficiary even in respect of benefits procedures referred to in Article 27 of acquired under a scheme in another Regulation No 3 had been completed Member State, or in respect of income exclusively under Belgian legislation. In derived from, or employment in, the so doing the Institution applied Article territory of another Member State; 70 (2) of the Belgian Law of 9 August provided that this rule shall not apply 1963 setting up and organizing a where benefits of the same kind are compulsory system of sickness and acquired in accordance with the invalidity insurance (Moniteur Belge of 1 provisions of Articles 26 and 28 of this and 2 November 1963, p. 10555). regulation.'

Article 9 of Regulation No 4 the benefits granted by that third country in order to reduce the benefit '2. The provisions of the preceding payable by the Member State paragraph notwithstanding and, subject pursuant to EEC regulations. to the provisions of the second sentence of Article 11 (2) of the regulation, where The Ministère Public observed before the implementation of the provisions of the Tribunal that: first sentence of Article 11 (2) of the — since Belgium and Austria had not regulation would entail reduction or entered into any international suspension of an invalidity, old-age or convention it was impossible to take death benefit (pensions), calculated into account periods of employment according to the provisions of Article 28 completed in Austria in calculating of the regulation by the institution of a the proportionate amount payable by Member State, that institution shall take Belgium. into account, for the purposes of the — Article 70 (2) of the Belgian Law of 9 reduction or supension, only a fraction of August 1963 had to be applied to the the benefits or income or remuneration present case. giving rise to the reduction or

4. Since Mr Kaucic disagreed with the employment completed in the Member Institution's method of calculation he States of the EEC, that is, Belgium and lodged an application before the Italy. From 1 January 1964 there is Tribunal du Travail (Labour Tribunal), scarcely any doubt, according to the Brussels. He requested the Tribunal to Tribunal, that Article 70 (2) of the declare that the invalidity allowance' Belgian Law of 9 August 1963 must be payable by the Belgian social insurance applied. institution should not be reduced by the

KAUCIC v INSTITUT ASSURANCES MALADIE-INVALIDITÉ

reduction contained in Article 70 (2) 'Do Articles 27 (1) and 28 (1) of of the Belgian Law of 9 August 1963 Regulation No 3 of 25 September 1958 cannot be applied. of the Council of the European Economic Community concerning social The Institution, with the support of the security for migrant workers preclude the Ministère Public, maintained in application by the institution of a particular before the Cour du Travail that Member State of the rules under its own — according to Article 28 (1) of legislation relating to the overlapping of Regulation No 3, Mr Kaucic's the benefit payable under this legislation pension must be calculated as if all and a benefit granted under the the insurance periods had been legislation of a third country and, in completed under Belgian legislation particular, do they preclude the and that, consequently, Article 70 (2) application of Article 70 (2) of the of the Belgian Law of 9 August 1963 Belgian Law of 9 August 1963 to the must be applied; overlapping of the benefit payable by the — there are no Community provisions Belgian institution and the benefit which enable Belgium to disregard payable by Austria, with which Belgium Article 70 (2) of the Belgian Law of 9 has not entered into a bilateral August 1963; convention relating to social security, — the derogation laid down in Article especially in the sense that the Belgian 11 (2) of Regulation No 3 is only institution could not apply the said applicable where benefits of the same Article 70 (2) in order to determine, for kind are acquired and calculated in accounting purposes, the amount to accordance with the rules relating to which the person concerned would be proportional calculation laid down in entitled if all the insurance periods or the Community rules and in the assimilated periods, aggregated in present case it is impossible to accordance with Article 27 of Regulation calculate the proportional amounts No 3, had been completed exclusively payable by Belgium and Austria. under Belgian law?'

1. The appellants in the main action point out that, since Belgium is not Article 28 establishes a fiction whereby bound to Austria either by a convention the worker is deemed to have completed or under the abovementioned his entire working life in the same Regulations Nos 3 and 4, the insurance country. Belgian legislation is accor periods completed in Austria which were dingly applicable unconditionally to the invalid with regard to the acquisition of present case. The fact that the insurance the right to and to the determination of periods completed by Mr Kaucic in the Belgian pension cannot be taken into Austria could not be taken into account consideration in order to alter the for the purposes of the acquisition of the calculation, on the basis of Community right in no way affects the calculation of provisions, of the Belgian pension. the amount of the Belgian benefit determined 'for accounting purposes'.

schemes to continue under which the benefits granted by a third country. beneficiaries are directly entitled either under national law alone or under Since the Belgian institution is inter national law supplemented, if necessary, vening in the payment of a benefit which by the system of aggregation of periods. has been calculated proportionately it In the present case the Kaucic sisters are seems illogical to apply Article 70 (2) of entitled to the benefits provided under the Belgian Law of 9 August 1963 in Belgian national law in implementation order to reduce further a benefit which

the EEC. July 1967 in Case 2/67, De Moor v

Community regulations with regard to maintains that the wording of Article 11 the grant of a proportion of a Belgian (2) of Regulation No 3 does not prevent benefit apply is subject to the same the Belgian institution from applying its obligations as Belgian nationals. This rule against overlapping of benefits in means that Article 70 (2) of the Belgian order to reduce the benefit payable by it Law of 9 August 1963 may be applied to if it is drawn concurrently with an all insured persons who are in receipt of invalidity benefit payable by a third Belgian benefits in respect of incapacity country: since the person concerned is in for work without its being necessary to receipt of a benefit acquired under resort to aggregation of insurance Regulation No 3 and since the Austrian periods, whilst it may not be applied to pension was by definition not calculated an insured person who is in receipt of pursuant to Articles 27 and 28 of the same benefits by virtue of Regulation No 3 the provisions for aggregregation which would no doubt be reduction laid down by the Belgian Law contrary to the spirit of Article 8 of are applicable to him, the more so since Regulation No 3. such reduction does not adversely affect the freedom of movement of the worker 3. The Commission observes that it is since it arises from his employment in a possible to reply to the preliminary third country. question submitted to the Court not only on the basis of the interpretation of The Commission adds nevertheless that Articles 27 and 28, the only provisions of such provisions for reduction may only Regulation No 3 to which the national be applied if Regulation No 3 is court refers, but rather on the basis of the beneficial to the worker. The Court of interpretation of Article 11 (2) of the Justice has indeed made this clear when,

in its judgment of 15 May 1974 in Case adoption of Regulation No 1408/71 of 184/73 (Bestuur van de Nieuwe the Council of 14 June 1971 on the Algemene Bedrijfsvereniging v Kauf application of social security schemes to mann, [1974] ECR 517), it stated that the employed persons and their families limitations referred to in Article 11 (2) moving within the Community (OJ, are applicable to insured persons only as English Special Edition 1971 (II), p. 416) regards benefits acquired under those according to which: 'Generally speaking, regulations. the reductions to be made pursuant to the provisions against overlapping may Nevertheless the Commission thinks that only be made if the benefit payable by those considerations do not take fully each of the Member States has been into account all the factors in the present finally determined', was restated in

reduced. At the hearing on 8 December 1976 the appellants, represented by Daniele In this respect it refers to the opinion of Rossini, Director of the Welfare Mr Advocate-General Mayras in Case Department of the Associazioni Cristiane 14/72, Heinze v Landesversicherungs Lavoratori Italiani, the respondent, anstalt Rheinprovinz ([1972] ECR 1117). represented by Adolf Houtekier, Advocate at the Belgian Cour de With regard to the second question Cassation, and the Commission, which it has formulated the Commission represented by its Legal Adviser, observes that in so far as the Belgian Marie-Jose Jonczy, acting as Agent, institutions, on the basis of the foregoing presented oral argument. statements, are entitled to reduce the benefit payable to Mr Kaucic, there is no The following submissions inter alia doubt that such a reduction may only be were put forward in addition at this

kind were involved. Since the Article 9 (2) of Regulation No 4 thus proceedings relate not only to benefits of expressly excludes the possibility of the same kind but also to benefits making a reduction when calculating the calculated proportionally it is necessary amount determined 'for accounting to apply the last sentence of Article 11 purposes'. This principle, which was (2) of Regulation No 3 which expressly recalled in a statement appearing in the authorizes overlapping of benefits of the minutes of the Council at the time of the same kind.

KAUCIC v INSTITUT ASSURANCES MALADIE-INVALIDITÉ

by analogy even though in the present Mr Advocate-General Mayras in Case case one of the three benefits to which 14/72, Heinze v Landesversicherungs­ the person concerned is entitled is paid anstalt Rheinprovinz. The Institution by a third country. considers that the opinion means that it may invoke the provision for reduction With regard to the submission of the laid down in the Belgian legislation. If respondent in the main action that, if the the Commission's argument were Court were to hold that the Community followed the claim against Belgium regulations preclude the disputed would be in excess of that permitted application of Article 70 (2) of the under Community law alone. In this Belgian Law of 9 August 1963, the respect the Institution also relies upon Belgian institutions would be obliged to the judgment of the Court of 16 apply this article and deduct the amount November 1972 in Case 16/72, of the Austrian pension from the amount Allgemeine Ortskrankenkasse Hamburg of the Belgian benefit calculated v Landesversicherungsanstalt Schleswig- proportionally, the appellants in the Holstein ([1972] ECR 1141). main action observed that such a calculation would be even more After the above-mentioned hearing Mr unfavourable to the insured person than Advocate-General Mayras was indisposed deducting the Austrian pension from and had to be replaced by Mr the Belgian amount calculated 'for Advocate-General Capotorti. accounting purposes'. On this ground the Court ordered the With regard to the Commission's oral procedure to be reopened. argument that Belgium is relying upon the Austro-Italian Treaty in order to At the new hearing on 16 February 1977 reduce the benefits payable by the latter the parties presented no oral argument, the respondent in the main action declaring that they referred to the maintains that this misrepresents the submissions, arguments and conclusions problem: Belgium should have applied which they had put forward at the the Belgian provision prohibiting hearing on 8 December 1976. overlapping. The Advocate-General delivered his Furthermore the Commission is opinion at the hearing on 16 February mistaken in invoking the opinion of 1977.

4 The question submitted comes within the context of a dispute concerning the amount payable by way of an invalidity pension to the successors of an Italian worker who died in Italy, having worked not only in Italy and Belgium but also in Austria, which is not a Member State of the Community, and who had been granted an invalidity pension by the Austrian institution calculated in accordance with the provisions of the bilateral social security agreement concluded between Italy and Austria.

5 Nevertheless the competent Belgian institution, in calculating the Belgian pension, not only applied the provisions of Regulation No 3 in order to aggregate the insurance periods completed in Italy and in Belgium but also, relying on Article 70 (2) of the Belgian Law of 9 August 1963, took into account the Austrian pension in order to reduce the benefit payable by it with regard to the period after 1 January 1968.

6 Under Article 70 (2) of the Belgian Law, Belgian insurance benefits shall not be added to the compensation payable in respect of the same damage under another legislation; however in every case the beneficiary must receive amounts which are not less than the amount of the insurance benefits.

KAUCIC v INSTITUT ASSURANCES MALADIE-INVALIDITÉ

7 It is clear from the judgment making the reference that the Belgian courts on the one hand have finally established that the provision must be interpreted to mean that it is also applicable when the damage is covered by a foreign law and, on the other, that the damage suffered by the worker in question was in fact covered by the pension granted under the Austrian law.

JUDGMENT OF 10. 3. 1977 - CASE 75/76

13 Accordingly it is necessary to reply to the question submitted that the provisions of Regulation No 3 of the Council of 25 September 1958 concerning social security for migrant workers, and in particular Article 28 (1) thereof, and of Regulation No 4 of the Council of 3 December 1958 do not preclude the application by the institution of a Member State, when calculating 'for accounting purposes' the amount of the benefit to which the person concerned would be entitled if all the insurance periods had been completed exclusively under the legislation of that Member State, of a rule laid down under its own legislation in order to reduce the theoretical amount by the benefit received by the person concerned from a source outside the Community.

Costs

14 The costs incurred by the Commission of the European Communities which submitted observations to the Court are not recoverable.

15 As these proceedings are, in so far as the parties to the main action are concerned, in the nature of a step in the action pending before the national court, costs are a matter for that court.

On those grounds,

Mackenzie Stuart O'Keeffe Bosco Touffait

Delivered in open court in Luxemburg on 10 March 1977.

A. Van Houtte H. Kutscher

Registrar President

OPINION OF MR ADVOCATE-GENERAL CAPOTORTI DELIVERED ON 16 FEBRUARY 1977 1

Mr President, Austria for 42 months between 1941 and Members of the Court, 1945; and in Italy for 323 weeks from 1949 to 1957. In 1957 he became unfit 1. The gist of the question of for work and was in receipt of two interpretation referred to the Court in invalidity pensions: one (with effect from this case may be summarized as follows: 1 October 1957) which was payable by do the Community provisions the competent Austrian institution and concerning social security for migrant which was covered by a bilateral workers permit or prohibit the Austro-Italian convention enabling application by a Member State of a rule aggregation of the periods of under its own legislation against the employment completed in the two overlapping of social insurance benefits countries and the other (effective from 1 in the case of a worker who has acquired January 1958) which was payable by the both the right to an invalidity pension Italian and Belgian social security under Community rules and the right to institutions in application of Community another pension of the same kind Regulations Nos 3 and 4. In accordance payable by a third State? with a decision of principle adopted at its The basic facts are as follows: fifty-first session (January 1964) by the EEC Administrative Commission on Mr Kaucic, an Italian national, had Social Security for Migrant Workers, the worked in three countries: in Belgium proportion of this second pension for 501 weeks between 1929 and 1940; in payable by the Italian institution, which