C-100/78

on the interpretation of Article 79 (3) of Regulation No 1408/71 of the Council of 14 June 1971, concerning the application of social security schemes to employed persons and their families moving within the Community (Official Journal, English Special Edition 1971 (II), p. 416),

THE COURT (Second Chamber)

composed of: Lord Mackenzie Stuart, President of Chamber, P. Pescatore and A. Touffait, Judges,

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

gives the following

ROSSI v CAISSE DE COMPENSATION TOUR ALLOCATIONS FAMILIALES

The facts, the procedure and the obser­ By a decision of 13 April 1976 the vations submitted under Article 20 of the Istituto refused to grant them to her on Protocol on the Statute of the Court of the grounds that "the status of head of Justice of the European Communities household for the purpose of family may be summarized as follows: allowances in respect of the daughters belongs to the rather and cannot be transferred to another person because I — Facts and procedure the father is not [sic] an invalid or unemployed". Claudino Rossi, an Italian national, born on 3 March 1924, after working in Italy Faced with this refusal by both funds to from 1938 to 1948, came to work in pay him the family allowances for his two children, Mr Rossi took the case to Belgium as a labourer in the coal mines from 1948 to 1953, then in the iron and the Tribunal du Travail, Charleroi, steel industry, from 1953 to 1958. which by its judgment dated 19 April 1978 submitted to the Court two pre­ As he suffered from an occupational liminary questions: disease, he was granted a pension payable by a Belgian social security 1. Is Article 79 (3) of Regulation No institution, calculated on the basis of a 1408/71 of the Council of the EEC permanent invalidity of 52% from 13 made inapplicable by the fact that May 1964 and of 100% from 11 Italian legislation does not, for December 1967. the purpose of granting family He is the father of two children, Clelia, allowances, allow the capacity of head of household to be transferred to the born on 28 October 1958, and Giuseppina, born on 23 March 1965, in wife when the husband is receiving a respect of whom he received family pension (Fonds des Maladies Pro­ allowances in Belgium until 28 February fessionnelles [Occupational Diseases 1973, at which date he returned to Italy Fund]) from another Member State? with all his family. In other words, must the Belgian With effect from 1 March 1973 the institution assume responsibility for payment of the family allowances was paying family allowances even if a suspended by the Belgian institution — right exists in Italy by virtue of the applying the provisions of Article 79 (3) pursuit of a professional or trade of Regulation (EEC) No 1408/71 — on activity by a member of the family of the grounds that the claimant's wife was the person receiving a pension but pursuing a professional or trade activity such right is imperfect owing to a in Italy such as to confer an entitlement particular feature of Italian to family allowances under the Italian legislation? legislation. The applicant's wife therefore requested the Istituto Nazionale della Previdenza Sociale (hereinafter referred to as "the Istituto") to pay her family allowances in respect of her two children.

Pursuant to Article 20 of the Protocol on The applicant goes on to point out that the Statute of the Court of Justice, this case is similar to Case 134/77, written observations were submitted on Ragazzoni, the judgment in which, behalf of Claudino Rossi by Daniele delivered on 20 April 1978 ([1978] ECR Rossini, Director of the welfare service 963), interprets Article 76 of Regulation "Patronam A.C.L.I." and C.S.C. trade No 1408/71. union representative, on behalf of Although they are drafted in different the Commission of the European terms, Articles 76 and 79 (3) pursue Communities by its Legal Adviser, J. C. the same aim, namely the prohibition of Seche, acting as Agent, on behalf of the the overlapping of allowances when Government of the Kingdom of Belgium entitlement exists in two Member States. by J. Dufour and on behalf of the Italian The only difference is that Article 76 Government by Adolfo Maresca and refers to workers in actual employment Franco Favara. On hearing the report of and unemployed persons, whereas the Judge-Rapporteur and the views of Article 79 deals with pensioners. the Advocate General, the Court decided to open the oral procedure without any In the case submitted to the Court, since preparatory inquiry. only the father, who is entitled to the pension for occupational disease payable by the Belgian insurance institution, can II — Written observations sub­ have the status of head of household mitted to the Court under the Italian legislation, it is for the Belgian institution to assume responsibility for payment of the family (a) Observations of the applicant allowances.

Second question The applicant considers that a national provision cannot be applied to a migrant Even if it is not evident from the worker if it is liable to impair rights judgment containing the reference, the acquired under the legislation of the second preliminary question is justified country of last employment. The by the existence of the following application of such a measure would be provisions: contrary to the aims of Article 51 of the Italian Law No 903 of 9 December 1977, Treaty which, in the context of the free which came into force on 18 December movement of workers, ensures the 1977, establishing equality of treatment payment throughout the Community of between men and women and allowing benefits acquired under the legislation of a Member State. the wife to obtain family allowances instead of the husband; The question submitted by the Tribunal The last paragraph of Article 60 of the du Travail, Charleroi, is based by consolidated Belgian legislation on implication on the example of two family allowances for employed persons, workers who, within the same Member consolidated by the Arrêté Royal of 19 State, have had to satisfy the same December 1939 (Moniteur Belge of 22 conditions in order to obtain a pension December 1939), which provides that "if for invalidity or occupational disease. If the family allowances due under under these two workers both reside in Belgium some other form of entitlement are less their children will receive family than those the granting of which is allowances under the Belgian scheme by provided for by this law, a person who is virtue of the father's pension, regardless entitled to rely upon this law may claim of the mother's situation: even if she is the difference". working or is herself in receipt of a pension, it is still the father who is Since the problem raised by this second question arises as from 18 December primarily entitled to the family allowances: if, on the other hand, one of 1977, it is necessary to determine first of all how to interpret and apply the Italian these two workers changes his place of residence to another Member State and law of 9 December 1977 in connexion the wife works there, the strict with Articles 76 and 79 of Regulation No 1408/71, where a husband and wife application of Article 79 (3) of Regu­ can both establish entitlement to family lation No 1408/71 may result in the allowances, one under the Italian wife's activity prevailing over the legislation, and the other under the husband's situation and adversely legislation of another Member State. affecting the rights in the field of family Article 9 of the aforementioned law provides that the wife "may" claim the family allowances "instead of" the husband. Must this provision be interpreted to mean that the wife is obliged to claim the family allowances in order that Article 79 (or Article 76) of Regulation No 1408/71 may be correctly applied? In other words, is it necessary to have exhausted all the possible means of obtaining the family allowances provided by the legislation of the children's country of residence before Article 76 or Article 79 ceases to be applicable?

allowances which he derives from his application of the rules establishing status as a pensioner. an order of precedence for the In order to remain consonant with prevention of overlapping. Article 51 of the Treaty, Article 79 of This principle must remain valid in Regulation No 1408/71 must not result the context of the application of in the rights of a migrant worker, who is Article 76 or Article 79 of Regulation in receipt of a pension, being adversely No 1408/71, with the result that, if affected by the situation of his wife or of the legislation of the children's another member of the family in the country of residence provides that the event of a change of residence to another father has the primary entitlement to State. family allowances and that the The institution of the country liable to mother may, but is not required to, apply also for the allowances, the pay the pension must in any case institution of the country liable to guarantee the benefits provided for by pay the pension must not consider the legislation which it applies, if those benefits are more favourable, subject to itself discharged from its liability to the right, in order to avoid double pay the family allowances. payments, to recover amounts awarded — Article 64 of the consolidated Belgian under the legislation of the country in laws on family allowances provides which the children reside. that, where several persons are In order to reach this conclusion the entitled to claim family allowances in respect of the same children, the applicant relies on the following prior right is accorded to the father. arguments: It appears from the present case that — The overlapping of entitlement to the father was last subject exclusively family benefits or allowances when to the Belgian legislation. Therefore the spouse is pursuing a professional it is the status of the father as a or trade activity is governed in rightful claimant which must prevail particular by Article 10 (1) of Regu­ over the mother's, even if she may lation No 574/72, as amended by henceforth acquire the status of head Regulation No 873/73. But this of household under the Italian law of article seems to apply, in its current 9 December 1977. version, only where the family — The last paragraph of Article 60 of allowances are due under the the same consolidated laws expressly legislation of a Member State provides for the grant of benefits whereby entitlement to these benefits under the more favourable scheme. is not dependent on conditions Consequently, in the event of family relating to insurance or employment, allowances being payable in Italy the which is not the case here since both Belgian fund must pay the difference in Italy and in Belgium the granting between the family allowances of family allowances depends on the provided under the Belgian scheme pursuit of a professional or trade activity or on entitlememt to a pension. The former version of the above­ mentioned Article 10 operated by reference to the national rules for determining priority. This meant that the reference to the legislation of the State in which the members of the family were residing also implied the

and those provided under the Italian specifies the rules whereby benefits are to scheme. be granted in respect of the dependent — Both in Belgium and in Italy children of pensioners and by virtue of entitlement to family allowances is which such benefits are to be granted subject to conditions relating to regardless of the Member State in which insurance or employment. In the the beneficiary resides. present case the right to the Belgian Applying this provision therefore, Mr family allowances exists by virtue of Rossi is normally entitled to the family the pension for occupational disease allowances, even after 28 February 1973, awarded in respect of work under the Belgian legislation. undertaken in Belgium. If one The right to the benefits due under considers that benefits for occu­ Article 77 is, however, suspended by pational disease are granted, by application of Article 79 (3) “if the virtue of Article 57 (1) of Regulation children become entitled to family No 1408/71, exclusively under the benefits or family allowances under the provisions of the legislation of the legislation of a Member State by virtue last State in which the victim was of the pursuit of a professional or trade exposed to the risk of occupational activity." disease, and that the enjoyment of the Belgian family allowances is The principle of prevention of over­ linked indirectly to the enjoyment of lapping rights to family benefits is the the invalidity pension granted by the same as that of Article 76 of Regulation Fonds des Maladies Professionnelles, No 1408/71, relating to family the Belgian authority ought, in any allowances for workers and unemployed case, on account of the connexion persons, which was recently applied in a which exists between the two forms judgment of 20 April 1978 (Case 134/77, of benefit, to pay the family Ragazzoni, [1978] ECR 963). allowances provided under the The only difference in the texts lies in Belgian scheme the fact that Article 79 (3) provides for the case where the children "become The second preliminary question sub­ entitled" to benefits, whereas Article 76 mitted by the Tribunal du Travail, deals with the case where benefits "are Charleroi, might therefore be answered also payable", which may be regarded as as follows: identical in substance. "When the grant of benefits or family By virtue of Article 1 of the legislation allowances depends on the grant of a on family allowances of 30 May 1955 pension, the application of Article 79 (3) (Gazzetta Ufficiale, 7 September 1955, of Regulation No 1408/71 cannot result No 206 Suppl. Ord. 1955 — II p. 1370) in the entitlement to the benefits or such allowances are payable in Italy in family allowances due under the respect of persons dependent on the legislation of the State liable to pay the head of household who, within the pension being affected by the application territory of that State, pursues a pro- of a less favourable provision of the legislation of the children's country of residence."

fessional or trade activity for reward in May 1955 and states in Article 9 thereof: the service of another. Article 3 of that "The family allowances… for legislation regards the father, primarily, dependent members of the family may be as head of household, the mother being paid alternatively (in alternativa) to a able to assume this status only in certain woman who is working or in receipt of a cases. pension on the same conditions and In the case of Mr Rossi the fact that he subject to the same limitations as those is totally incapacited from working was laid down for a man who is working or not sufficient — in the view of the in receipt of a pension.

expressly refers to the case where the lation No 1408/71, of the entitlement to husband suffers from 100 % invalidity (il family benefits or allowances in marito invalido pemanente al lavoro) as one of the cases in which the mother is pursuance of Article 73 of that regu regarded as head of household. lation is not applicable when the father works abroad in a Member State whilst However, the Commission is of the the mother is employed in the country in opinion that it is not necessary to insist which the other members of the family on this objection, which would lead the reside and has not acquired under the Belgian court to examine the justification legislation of the said country of for the Italian decision and the Court of residence a right to family allowances Justice to interpret Italian law, which lies either because only the father is outside its jurisdiction.

(Gazzetta Ufficiale, 17 December 1977) has amended the text of the law of 30

acknowledged to have the status of head of household or because the conditions First question: for awarding to the mother the right to The Belgian Government points out in payment of the allowances have not been the first place that Article 79 (3) of Regu­ fulfilled". lation No 1408/71 is applicable if in Italy there exists, in respect of the children, a right to allowances as a result Second question of the pursuit of a professional or trade activity. It follows from this reply that the It goes on to observe that the Italian obligation to pay the family allowances legislation provides that a working falls upon the Belgian institution. mother becomes intitled to family Consequently no comparison is necessary allowances in her own right if the father between the Belgian amount and the is an acknowledged invalid. presumably lower Italian amount. It is clear that, if a pension at a rate of 100 % has been granted on account of However, on the assumption that, as a result of the combined effect of Article occupational disease, there can be no doubt about the state of invalidity and 77 (2) and Article 79, the family this state can be judged not by the Italian allowances paid in one Member State are lower than those which the beneficiaries institution, but rather by the Belgian institution by which the pension is could have claimed in another, there is payable. no reason to proceed to a comparison of the amounts because Regulation No Consequently, as regards the first pre­ 1408/71 determines which legislation is liminary question, the Belgian Govern­ ment considers that the father of the applicable in the field of family allowances according to criteria which family, being an invalid within the do not take any such comparison into meaning of the Belgian legislation, fulfils account and without establishing any the conditions of the Italian legislation supplement designed to award to the whereby the mother, who is herself recipients the highest amount provided working, may become entitled to the for by the various laws which might be family benefits provided for by the applied. Italian legislation. Second question In these circumstances the Commission considers that the second question The Belgian Government submits that no should be answered as follows: “Article provision of the regulation establishes a 79 (3) of Regulation No 1408/71 does right to a supplementary payment of not provide that a competent institution family allowances to be provided by which, in application of that provision, another country. suspends payment of the benefits payable (d) Observations of the Italian Govern­ by it under Article 77, should grant a ment supplement to take into account any difference between the amount of the The Italian Government points out, in benefits which it has ceased to pay and the first place, that when the Belgian those to which the children become institution suspended the award of family entitled in another State, by virtue of the allowances, on Mr Rossi's return to pursuit of a professional or trade Italy, on 28 February 1973, that decision activity". "might constitute an infringement of

Article 77 (2) of Regulation No Ragazzoni judgment to be applied to the 1408/71, according to which the place of present case. Moreover, since the residence of the pensioner or his children decision of the Istituto of 13 April 1976, is irrelevant”. which cannot now be challenged, has — However, this is only an indication correctly according to the Italian because, in giving reasons for its refusal legislation then in force — precluded the to pay family allowances, the Belgian possibility of the Rossi children's institution did not rely upon the change becoming entitled to family allowances of residence, but chose instead the by virtue of the trade or professional pursuit of a professional or trade activity activity pursued by their mother, the by Rossi's wife in Italy, although the Belgian institution should merely note documents do not indicate the date on that there is in fact no overlapping of which this activity began. benefits such as is required for the suspension under Article 79 (3). On a date not specified Mrs Rossi, whose husband was no longer drawing Second question family allowances, applied to the Istituto for payment of them, basing her In the Italian Government's view the application on her own employment but second question can concern only the by a decision of 13 April 1976, which period after 18 December 1977, on was not challenged and is no longer which date Law No 903 of 9 December subject to judicial review, the Istituto 1977 dealing with equality of treatment rejected this request on the ground that for men and women in the social field there was no basis for it under the Italian came into force in Italy. legislation then in force. Strictly speaking, it is irrelevant because the proceedings before the Tribunal at First question Charleroi were commenced on 30 November 1976 and therefore well Article 79 (3) constitutes a rule against before 18 December 1977. the overlapping of benefits, the object of which is to "prevent entitlement to Nevertheless, the Italian Government is several family allowances arising" in anxious to examine the second question. respect of the same child. The Whilst it is true that Article 79 (3) speaks application of this rule is subject to of "suspension" and not of "reduction", the actual existence of overlapping which might suggest that the suspension entitlement to several family allowances. must always be total, it must also be If for any reason such overlapping does remembered that Article 3 (1) of Regu­ not occur Article 77 remains applicable. lation No 1408/71 lays down the principle of "equality of treatment" for Article 79 (3) creates a rule analogous to nationals of all Member States. It follows that contained in Article 76 of the same regulation. With regard to Article 76 the Court ruled in the Ragazzoni judgment that family allowances are due only when all the conditions imposed by national legislation are fulfilled and that prior to Law No 903 of 9 December 1977 the Italian legislation did not permit payment of family allowances to a working mother save by way of exceptions in certain specified cases. Consequently it is sufficient for the principles declared by the Court in the

that the decisive test for resolving the — Article 79 (3) of Regulation No question raised lies in the rationale of the 1408/71 is valid only if it is interpreted rules against overlapping of benefits. As as meaning that the suspension of family those rules are designed solely to prevent allowances linked to pensions may also unjustified enrichment a total suspension be only partial and must be effected to would be excessive in relation to that the extent strictly necessary in order to rationale and contrary to Article 51 of prevent the unjustified enrichment of the the Treaty. recipient of the benefit”. Therefore Article 79 (3) should be interpreted as providing alternatively for total suspension or partial suspension, III — Oral procedure depending on whether the amount of the The hearing took place on 30 November family allowances linked with the 1978. pension is less or greater than the amount of the family allowances which The Commission pointed out that the overlap them. plaintiff in the main action, in his written observations, cited the last paragraph of Moreover, the principle of the most favourable treatment of the worker is Article 60 of the consolidated Belgian laws on family allowances. That recognized in other provisions and in the provision states that, if the family preamble to Regulation No 1408/71. allowances payable under some other In conclusion, this interpretation would form of entitlement are less than those give complete effect to the principle of for the grant of which provision is made equality of treatment to which the by the said Belgian laws, the claimant is Belgian court rightly referred. entitled to receive the difference. In Indeed, without this interpretation, those circumstances, if the Court were to workers who have contributed at the decide to answer the second question, same rate to the building up of funds for the Commission suggests that the social security would receive different judgment should not preclude the amounts of benefit as a result of circum­ claimant from taking advantage of a stances which have nothing to do with national provision providing for a social security. supplement. Just as in the field of For these reasons the Italian Government pensions, according to the case-law of proposes that the Court should declare the Court, a national provision against that: overlapping of benefits may be applied “— Article 79 (3) of Regulation No where there is a reference to national 1408/71 contains a rule against the over­ legislation, in the same way where, as in lapping of benefits and it provides for the this case, there is a reference to national suspension of family allowances linked to law in the field of family allowances, it pensions only where the children actually would be possible to apply a national become entitled to other family provision granting a national supplement. allowances under the legislation of a The Advocate General delivered his Member State by virtue of the pursuit of opinion at the hearing on 1 February a professional or trade activity. 1979.

5 In fact, however, the plaintiff was refused payment of the family allowances by a decision, dated 13 April 1976, of the I.N.P.S. [National Social Security Institution], Bologna, on the ground that, according to the Italian legislation applicable at the time, the status of head of household, as regards entitlement to family allowances, belongs to the father and cannot be transferred to another person because the father is neither an invalid nor unemployed.

6 In these circumstances the Tribunal du Travail, Charleroi, submitted two questions, the first of which is as follows:

ROSSI v CAISSE DE COMPENSATION TOUR ALLOCATIONS FAMILIALES

"Is Article 79 (3) of Regulation No 1408/71 of the Council of the EEC made inapplicable by the fact that Italian legislation does not, for the purpose of granting family allowances, allow the capacity of head of household to be transferred to the wife when the husband is receiving a pension (Fonds des Maladies Professionnelles) from another Member State?

In other words, must the Belgian institution assume responsibility for paying family allowances even if a right exists in Italy by virtue of the pursuit of a professional or trade activity by a member of the family of the person receiving a pension but such right is imperfect owing to a particular feature of Italian legislation?”.

7 According to Article 77 of Regulation No 1408/71 a pensioner is entitled to the family allowances provided by the legislation of the Member State responsible for the pension, irrespective of the Member State in whose territory the pensioner or the children are residing.

12 Since the answer to this question is not expressly determined by the regu­ lations dealing with social security for migrant workers, it can be found only through the interpretation of those regulations in the light of the aims pursued by the provisions of the Treaty (Articles 48 to 51) under which they were made.

13 The regulations did not set up a common scheme of social security, but allowed different schemes to exist, creating different claims on different institutions against which the claimant possesses direct rights by virtue either of national law alone or of national law supplemented, where necessary, by Community law.

14 The Community rules could not, in the absence of an express exception consistent with the aims of the Treaty, be applied in such a way as to deprive a migrant worker or his dependants of the benefit of a part of the legislation of a Member State.

15 One such exception is established by Article 79 (3) of Regulation No 1408/71 which provides that entitlement to benefits for dependent children of pensioners shall be suspended if the children become entitled to family benefits or family allowances under the legislation of a Member State by virtue of the pursuit of a professional or trade activity.

16 That rule, designed to prevent the overlapping of family allowances, is applicable only to the extent to which is does not, without cause, deprive the persons concerned of the benefit of a part of the legislation of a Member State.

17 When the amount of the allowances of which payment is suspended is greater than that of the allowances received by virtue of the pursuit of a

On those grounds,

THE COURT

in answer to the questions referred to it by the Tribunal du Travail, Charleroi, by judgment of 19 April 1978, hereby rules:

1. Under Article 79 (3) of Regulation No 1408/71 of the Council, the suspension of the entitlement to family allowances in respect of the dependent children of a father who is in receipt of a pension under the legislation of a Member State is not applicable if the mother has not actually become entitled to those same allowances under the legislation of another Member State by virtue of her pursuit of a pro­ fessional or trade activity, 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.

OPINION OF MR CAPOTORTI — CASE 100/78

2. Article 79 (3) is applicable only to the extent of the amount actually paid by virtue of the pursuit of a professional or trade activity.

1 — Translated from the Italian.