C-37/77

of the system Aggregation and apportionment — Preference —

Regulation No 1408/71, Article 46 (1)

So long as a worker is receiving a provided that if the application of such

pension by virtue of national legislation national legislation proves less favourable alone, the provisions of Regulation No than the application of the rules

1408/71 do not prevent the national regarding aggregation and apportionment

legislation, including the national rules those rules must, by virtue of Article 46

Fonds National de Retraite des Ouvriers Mineurs , Brussels,

on the interpretation of Article 12 of Regulation No 1408/71 of the Council of 14 June 1971 on the application of social security schemes to employed

persons and their families moving within the Community (OJ, English Special Edition 1971 (II), p. 416),

1 — Language of the Case; French.

JUDGMENT OP 13. 10. 1977 - CASE 37/77

THE COURT

Facts and issues

The facts, the procedure and the written institution, on the basis of the

observations submitted under Article 20 aggregation of the Belgian and the Italian of the Protocol on the Statute of the periods of work.

Court of Justice of the EEC may be summarized as follows: Applying the national rules against the

overlapping of benefits (Article 23 (1) of the aforesaid Royal Decree), the I — Facts and procedure competent Belgian fund, the Fonds National de Retraite des Ouvriers Mr Greco, an Italian national, worked in Mineurs (FNROM — National Pension Italy as a building worker from 3 Fund for Mineworkers), deducted the

September 1949 to 19 May 1956 (a total amount of the Italian pension from the

provides that an invalidity pension shall Justice for a preliminary ruling under

be granted to any mineworker who can Article 177 of the EEC Treaty:

establish that he has worked in the

mining undertakings for ten years or Is Article 12 (2) of Regulation (EEC) No more. Mr Greco was also granted a 1408/71 compatible with the reduction

proportion of the invalidity pension of an invalidity pension granted by a

payable by the Italian insurance Member State under Article 46 (1) on the

Charleroi, was received at the Court on Belgian pension and an Italian 30 March 1977. pension the sum total of which is less than the complete Belgian pension to After hearing the report of the which he would be entitled under

Judge-Rapporteur and the views of the Belgian legislation alone. Moreover, Advocate General, the Court decided to when it converted the Italian pension

open the oral procedure without any into Belgian francs for the purpose of

preparatory inquiry. deducting it from the Belgian

pension, the Belgian fund did not use

the conversion rate laid down by II —

been delivered, and by the defendant in incompatibility of Article 46 (3) with the main action in Case 22/77 (FNROM Article 51 of the Treaty also entails v Mura), in which judgment has not yet the incompatibility of Article 12 with

been delivered. the said Article 51, it must then be inferred that the rules referred to in In addition, he makes the following Regulation No. 574/72 at Article 7 (1) remarks: (b) and (c) also apply to benefits of

— It follows from the judgment in Case the same kind. In that case, when it 35/74 (Alliance Nationale des reduces the Belgian pension, the

Mutualités Chrétiennes and Institut FNROM must take into account a

National d'Assurance Maladie fraction and not the whole of the

Invalidité v Thomas Rzepa [1974] Italian benefit ECR 1241) that a benefit to which

Italian pension into account for the amounts to more than the upper limit of purpose of reducing the pension due the overlap authorized by Belgian under Belgian legislation alone; legislation, and how it is possible for a

— Article 12 of Regulation No 1408/71 worker who has been employed in Italy,

expressly authorizes the overlapping in Belgium and in France not to derive

JUDGMENT OF 13. 10. 1977 - CASE 37/77

any benefit from the periods of work quently, national benefits, which are in completed in the latter two countries, issue in the main action, do not come

since the proportionate amounts of the within the exception created by the

concerning Regulation No 3 may be benefits which Article 12 seeks to avoid continued (cf. Cases 140/73, Mancuso is prevented by Article 46 (3). [1973] ECR 1449, and 50/75, Massonet [1975] ECR 1473); this clearly implies However, the consequences deciding of that in the overlapping of case of an that the correction provided for by incompatible benefits such as that in issue in the main Article 46 (3) is with action national provisions for reduction Article 51 of the Treaty would be: should be introduced. If it were not — that Article 46 introduces possible to introduce such provisions, discrimination against non-migrant that part of the benefit which would not workers; be granted thereunder would none the — that Article 12 is also incompatible less have to be paid by virtue of the with the first subparagraph of Article regulation, which, in the light of the 46 (1); Petroni judgment, would mean that there — that Article 12 must be declared would be no obstacle to applying the incompatible with Articles 7, 48 and provisions of Article 46 (3) thereto. 51 of the Treaty and cannot therefore Therefore, in practice, the relationship prevail over internal rules against the which exists between the second overlapping of benefits. sentence of Article 12 (2) and Article 46 The Belgian Government recalls its (3) implies that it must always be possible to make a reduction under one of those arguments in the aforementioned two provisions. Manzoni and Mura cases and, for the

rest, submits exactly the same Finally, Articles 48 and 51 of the Treaty observations as the FNROM. cannot result in the person concerned s

overlapping involving benefits of the a rule against overlapping of benefits the

same kind awarded in respect of — nor the FNROM could reduce the

invalidity by the institution of another invalidity pension on the basis of its Member State for the purpose of internal rules against the overlapping of

an invalidity pension granted benefits. reducing without aggregation in accordance with

Article 46 (1). It emerges from the

jugdment making the reference that the Going beyond the literal interpretation of Article 12 (2), a teleological interpretation invalidity pension due to Mr Greco was of that provision should be undertaken. awarded first of all on the basis of The implementation of national rules Regulation No 3, then on the basis of against the overlapping of benefits Regulation No 1408/71. The Com­ generally takes the form of the deduction mission out that under Article 94 points From the pension to which entitlement (5) of Regulation No 1408/71, the was acquired under the legislation of a institutions may review benefits awarded single Member State on the basis of the on the basis of Regulation No 3 periods completed under that legislation according to the new provisions of

benefit to which entitlement was Article 12 first of all lays down the acquired under national legislation alone, principle that national legislative and that such a limitation on the provisions against the overlapping of overlapping of two benefits has rightly benefits may be applied to workers been found by the Court to be covered by Regulation No 1408/71, incompatible with Article 51 of the except in the case of certain benefits of im­ Treaty, it follows that the the same kind, in particular invalidity of such plementation rules runs contrary benefits awarded in accordance with to the intentions of the Community Article 46. It follows that Member States legislature which, at all events and cannot apply their national rules against irrespective of the question whether such the overlapping of benefits outside the a rule is compatible with Article 51 of limits authorized by Article 12 (2) the Treaty, intended to secure for without infringing Community law. migrant workers the total sum of the benefits calculated in accordance with In the case at issue in the main action, it for the Article 46 (1) and (2) within the limit of was undoubtedlynecessary the highest theoretical amount, which is purpose of entitlement to benefit in Italy not necessarily the amount calculated that the insurance periods should be according to the legislation implemented aggregated, and the pension was awarded by the institution which awards the on the basis of Article 46 (2). On the benefit under Article 46 (1). other hand, aggregation was not

necessary for entitlement to benefit in Belgium. invalidity Therefore, the It seems that in its judgment in Case pension due to Mr Greco was awarded by 24/75, Petroni v ONPTS, the Court did the FNROM on the basis of Article 46 not condemn the actual principle of the

acquired under Article 46 (1) or under At the hearing on 14 July 1977, the Article 46 (2). Moreover, if the plaintiff in the main action, represented

overlapping of pensions were to be by Mr Rossini, Director of the Italian considered unjustified, it does not appear welfare service 'PatronatoACLI', the desirable for the reduction to be effected FNROM, represented by Mr Stein, and on the basis of internal provisions against Commission European the of the overlapping. In the absence of a common Communities, represented by Miss social security scheme, it would be Jonczy, acting as Agent, submitted their preferable by far to have a Community oral observations. rule enabling unjustified overlapping of benefits to be avoided. However, there The Advocate-General delivered his would then arise the problem of knowing opinion at the hearing on 20 September what is unjustified overlapping. 1977.

Decision

1 By a judgment of 24 March 1977 which was received at the Court Registry on 30 March 1977 the Tribunal du Travail, Charleroi, referred a question to the Court under Article 177 of the EEC Treaty on the interpretation of Article 12 of Regulation (EEC) No 1408/71 of the Council of 14 June 1971 on the

application of social security schemes to employed persons and their families

moving within the Community (OJ, English Special Edition 1971 (II), p. 416).

Member States were aggregated and the Italian benefit was apportioned.

5 Applying the national rules against the overlapping of benefits, the Belgian institution then deducted the apportioned amount of the Italian benefit from the invalidity pension, and asked the person concerned to refund the sum

paid as a recoverable advance.

6 The question referred to the Court is whether Article 12 (2) of Regulation No 1408/71 is compatible with the reduction of an invalidity pension granted by a Member State under(1) Article 46 that similar benefits are on the ground

awarded by the competent institution of another Member State, where such reduction is effected on the basis of provisions of the internal law of the first Member State.

7 Article 12 (2) of Regulation No 1408/71 provides that The legislative provisions of a Member State for reduction, suspension or withdrawal of

24/75, Petroni v ONPTS [1975] ECR 1149), Article 46 (3) is incompatible with Article 51 of the Treaty to the extent to which it imposes a limitation on benefits acquired in different Member States by a reduction in the amount of

a benefit acquired under national legislation alone.

JUDGMENT OF 13. 10. 1977 - CASE 37/77

9 It follows that the provisions of that paragraph are not applicable where they bring about a reduction in the benefit acquired by virtue of a Member State's national legislation alone and that, where that is the case, the second sentence of Article 12 (2) is inapplicable.

10 When the second sentence is not applicable, the first sentence applies, with the consequence that national legislative provisions for reduction, suspension or withdrawal of benefit may be invoked.

11 However, it appears from Article 46 (1) that if the application of national

less favourable than the application of the rules regarding aggregation and

apportionment those rules must, by virtue of Article 46 (1) of Regulation No 1408/71, be applied.

Costs

13 The costs incurred by the Belgian Government, the Netherlands Government and the Commission of the European Communities, which have submitted

observations to the Court, are not recoverable.

14 As these proceedings are, in so far as the parties to the main action are

prevent the legislation, including the national rules national

against the overlapping of benefits, from being applied to him in its entirety, provided that if the application of such national

legislation proves less favourable than the application of the rules

regarding aggregation and apportionment those rules must, by virtue of Article 46 (1) of Regulation No 1408/71, be applied.

Kutscher Sørensen Bosco

Donner Mertens de Wilmars Pescatore O'Keeffe