C-134/77

Pursuit of a professional or trade that regulation is not applicable when activity in the State in whose territory the father works abroad in a Member the members of the family are residing State whilst the mother is employed in is not a sufficient condition for the the country in which the other members suspension of the entitlement conferred of the family reside and has not by Article 73 since it is necessary in acquired under the legislation of the addition that the family benefits should said country of residence a right to be "payable" under the legislation of family allowances either because only that Member State. the father is acknowledged to have the Consequently the suspension, under status of head of household or because Article 76 of Regulation No 1408/71, the conditions for awarding to the of the entitlement to family benefits or mother the right to payment of the allowances in pursuance of Article 73 of allowances have not been fulfilled.

In Case 134/77

REFERENCE to the Court under Article 177 of the EEC Treaty by the Tribunal du Travail (Labour Tribunal), Brussels, for a preliminary ruling in the action pending before that court between

Silvio Ragazzoni

1 — Language of the Case: French.

JUDGMENT OF 20. 4 1978 — CASE 134/77

JUDGMENT

Facts and Issues

The facts of the case, the procedure and the defendant in the main action, the observations submitted pursuant to refused the claim for the payment of Article 20 of the Protocol on the Statute family allowances which Mr Ragazzoni of the Court of Justice of the European submitted on the basis of his work in Communities may be summarized as Belgium; it relied upon Article 76 of follows: Regulation (EEC) No 1408/71 which lays down rules of priority in cases of overlapping entitlement to family I — Facts and procedure benefits or family allowances, which is worded as follows: Mr Ragazzoni, the plaintiff in the main "Entitlement to family benefits or action, is an Italian employed in family allowances under Articles 73 and Belgium; his wife and three children 74 shall be suspended if, by reason of reside in Italy where his wife is the pursuit of a professional or trade employed. activity, family benefits or family The Caisse de Compensation pour Allo­ allowances are also payable under the cations Familiales "Assubel" (Assubel legislation of the Member State in Family Allowance Compensation Fund, whose territory the members of the hereinafter referred to as "the Fund"), family are residing."

RAGAZZONI v ASSUBEL

The Tribunal du Travail, Brussels, at the request of Mr Ragazzoni and the The plaintiff in the main action recalls suggestion of the Ministère Public his family situation and the facts set out in the decision of the Tribunal du (Public Prosecutor's office) stayed the Travail. He states that under Italian law proceedings and, by a judgment of 25 October 1977, which was received at the fan that the father, the head of household, resides in another State does the Court Registry on 8 November 1977, submitted to the Court of Justice not automatically entail the transfer of status of head of household to the of the European Communities the following question: mother except in strictly defined cases (desertion of the family by the father, "Is the suspension of the entitlement to permanent unfitness for work, family allowances provided for by unemployment, military service or death Article 76 of Regulation (EEC) No of the father etc.). Mr Ragazzoni does 1408/71 applicable when the father is not fulfil any of the prescribed employed abroad in a Member State of conditions and his wife has not been the EEC but the mother is employed in authorized to receive family allowances the country in which the other members in Italy, as was stated by the Istituto of the family reside and when the Nazionale della Previdenza Sociale legislation of the country of residence (national social welfare institution), makes provision for the payment of Turin, to which she is affiliated. family allowances only to heads of household who are working in the The plaintiff in the main action points territory of the country of residence and out first that in actual fact despite the recognizes only the father as having the objectives pursued by Articles 48, 51 status of head of household?" and 117 of the Treaty and despite the

1. Article 76 of Regulation No 1408/71 "The suspension of the right to family constitutes an exception to the rule allowances provided for by Article 76 of in accordance with which family Regulation (EEC) No 1408/71 is not allowances should be granted in the applicable where all the conditions country in which the migrant worker required by the legislation of the country of residence of the children is employed (cf. twelfth recital in the have not been fulfilled and the family preamble to the regulation and benefits which would be payable by Articles 73 (1) and 75 (1) (a) reason of the pursuit of a professional thereof); or trade activity have not in fact been 2. The actual wording of Article 76 awarded." establishes that is applies only if the The Commission of the European Com­ conditions for the acquisition of the munities states that Article 3 of the right have been fulfilled and the consolidated version of the legislation family benefits have actually been relating to family allowances, dated paid in the country of origin, which 30 May 1955, regards primarily the is not the fact in the present case. father as head of household. The 3. The judgment of the Court of mother can only be granted this status 17 June 1970 in Case 3/70 (Beninato in specific cases, which do not include (nee Di Bella) [1970] ECR 415) has the employment abroad of the father. established that Community regu­ Thus in the present case Italian lations in the matter of social legislation does not confer an security for migrant workers are not entitlement to family allowances in Italy to be interpreted in such a way as to on the members of the Ragazzoni deprive those concerned of benefits family. to which they are entitled by reason Since the plaintiff worked in Belgium of their place of permanent residence (that is, in a State other than France, a and that a person must not be situation for which special arrangements regarded as having come under the are made pursuant to Article 73 et seq. legislation of another Member State of the regulation) the solution depends unless he has in fact satisfied all the on the country of employment and conditions under which he may entails the granting of the family acquire a right. benefits for which provision is made by the legislation of the country where the The plaintiff in the main action person concerned is employed at the considers furthermore that the disputes expense of the latter country (Articles which arise in this sphere could be 73 (1) and 75 (1)).

Article 76 with which the preliminary this provision is not to establish a sub question is concerned lays down rules sidiary right in the country of residence of priority in cases of overlapping but to avoid overlapping benefits. entitlement to family benefits under Failure to have regard to the fact that Article 73 by reason of the pursuit of a no right exists in the country of professional or trade activity in the residence would result in ruling out all country of residence of the members of rights to benefits by virtue of Italian the family. 'This principle that benefits legislation on the one hand and of the shall not overlap is in fact based on the wrong application of Article 76 on the actual purpose of the family allowances other. or benefits, as it emerges from the The Commission emphasizes that the above-mentioned definitions.

may be the case if, for example, the under Article 76 of Regulation No legislation of the country of residence 1408/71 unless, by reason of the pursuit provides for the acquisition of the right of a professional or trade activity, to benefits only after the second or entitlement to benefits or allowances in third child; since no benefit is payable fact exists in pursuance of the legislation in respect of the first child Article 76 is of the Member State in whose territory not applicable; it becomes applicable the members of the family are residing." after the second or third child. The Belgian Government first recalls the To return to the example of Italian facts of the dispute and then states that legislation, Article 76 might in theory Article 76 "contains a rule of a apply if the mother worked in another legislative nature and must be Member State whilst the father was understood as taking priority as a employed in Italy where the children Community provision which is

Consequendy Article 76 the meaning of Article 76. The aim of does not refer to the domestic

provisions of the country of residence natively to an employed wife on the concerning overlapping but designates same conditions and subject to the same the law of that country as the restrictions as those laid down for the competent legislation within which the worker": there was thus conferred upon right to family benefits or family working wives the right to claim that allowances must be considered. This is family allowances shall be paid to them shown clearly by Article 10 of Regu­ rather than to their employed husbands. lation No 574/72, as amended by Regu­ If both parents claim payment of family lation No 878/73, which expressly allowances for dependent children "the provides that, when a professional or family allowances shall be paid to the trade activity is pursued in the country parent with whom the child lives". It is in which the members of the family clear that if a working wife does not reside, the legislation of that country avail herself of the option which Law shall have priority. Accordingly, in No 903 of 9 December 1977 provides order to obtain a common and uniform for her, that is to say if she does not result in all Member States the said claim that the family allowances should Article 76 must be interpreted in the be paid to her, the rules established by same way". the earlier provisions of 30 May 1955 The Italian Government recalls the remain in force and applicable. meaning of the concept of "family It is clear that the new law cannot give allowances" for the purposes of Regu­ rise to a different interpretation of lation No 1408/71 and the scope of the Article 76 of Regulation (EEC) No prohibition on overlapping in Article 76. 1408/71 as it does not have retroactive That provision must be interpreted in effect and thus does not alter the accordance with the familiar criterion of circumstances of the dispute pending interpretation to the effect that a dero­ before the Tribunal du Travail, gative provision cannot be extensively Brussels; likewise it will not apply in applied to cases for which provision has future to Mr Ragazzoni, the plaintiff, not been expressly made and in unless his wife decides to exercise the accordance with its purpose as a option made available to her under provision prohibiting overlapping, which Article 9 of Law No 903 of 9 December is intended to prevent the same person 1977.

In conclusion the Italian Government he referred to the situation which might suggests that the Court of Justice should come about through the application of deliver a ruling in the following terms: the new Italian provision and — "Article 76 of Regulation (EEC) No considered that "if the right exists in 1408/71 must be interpreted to two States the higher benefits alone mean that it does not require the should be paid, in conjunction with a suspension of family allowances paid system of compensation and repayment to a worker in the event of the between the competent funds". pursuit of a professional or trade The Commission made certain sup­ activity by a member of the family, plementary remarks on the observations even if family allowances are lodged by the Belgian Government and payable by reason of this latter the Italian Government. First, it is activity to the member of the impossible to take a comparison of the worker's family; rates into consideration, even if this — Article 76 of Regulation (EEC) No situation is undesirable from the 1408/71 must be interpreted to legislative point of view. Secondly, the mean that it does not establish a Council does not have power pursuant criterion for distributing powers to Article 51 of the Treaty to confer a between 'institutions' but merely sets right in a country of residence where out an important provision against such a right does not exist under overlapping to apply where family national legislation. Thirdly, if the new allowances are actually 'payable' Italian law is viewed in the context of also under the legislation of the Community law the Italian argument Member State where the members of would result, according to the the family are residing." Commission, in providing a choice between the family allowances of the country of residence and those of the III — Oral procedure country of employment; such a choice is The representatives of Mr Ragazzoni in principle excluded by Regulation No and of the Commission of the European 1408/71 with regard to applicable Communities appeared at the hearing legislation and clearly is not provided on 9 March 1978. They expanded the for in Article 76. The Community arguments which they had set out in rule prohibiting overlapping must their written observations and stated accordingly prevail over any national their points of view concerning the right to exercise an option. The problem constituted by the existence of Commission emphasizes the danger of the Italian Law No 903 of 9 December providing too abstract a reply to a 1977 which was referred to by the question submitted within the Italian Government in its observations. framework of specific legislation in force at the time of the main action. The plaintiff in the main action emphasized that the provisions must be The Advocate General delivered his taken into consideration as they stood opinion at the hearing on 16 March at the time of the dispute. Nevertheless 1978.

5 The Fund infers from the foregoing that that provision lays down a rule of legislative nature and must be understood as taking priority as a Community provision which is applicable whenever a professional or trade activity is pursued in the territory of the Member State in which the members of the family reside.

6 In this case Article 76 is an exception to the principle laid down by Article 73 whereby a worker subject to the legislation of a Member State other than France is entitled to the family allowances provided for by the legislation of the first Member State for members of his family residing in the territory of another Member State as though they were residing on the territory of the first Member State.

RAGAZZONI v ASSUBEL

7 The objection which may be raised to that view is that, apart from the fact that Article 76 is only intended to limit the possibility of overlapping benefits, pursuit of a professional or trade activity in the State in whose territory the members of the family are residing is not sufficient for the suspension of the entitlement conferred by Article 73 since it is necessary in addition that the family benefits should be "payable" under the legislation of that Member State.

8 For family allowances to be regarded as "payable" under the legislation of the Member State in whose territory the members of the family are residing the law of such State of residence must recognize the right to the payment of allowances in favour of the person in that family who works in such State.

9 The person concerned must thus fulfil all the conditions required by the domestic legislation of that State in order to exercise that right.

14 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, the decision as to costs is a matter for that court.

On those grounds,

THE COURT

in answer to the question referred to it by the Tribunal du Travail, Brussels, by a judgment of 25 October 1977, hereby rules:

The suspension under Article 76 of Regulation No 1408/71, of the entitlement to family benefits or allowances in pursuance of Article 73 of that regulation is not applicable when the father works abroad in a Member State whilst the mother is employed in the country in which the other members of the family reside and has not acquired under the legislation of the said country of residence a right to family allowances either because only the father is acknowledged to have the status of head of household or because the conditions for awarding to the mother the right to payment of the allowances have not been fulfilled.

Kutscher Sørensen Bosco Donner Mertens de Wilmars