C-237/78

JUDGMENT OF 12. 7. 1979 — CASE 237/78

nationality of the beneficiaries of applies according to whether those social security schemes, but also all schemes do or do not pursue disguised forms of discrimination objectives of demographic policy. which, by the application of other distinguishing criteria, lead in fact to 4. Articles 2 (1), 3 (1) and 4 (1) (c) and the same result. Such may be the case (2) of Regulation No 1408/71 must with a provision which makes the be interpreted as meaning that the grant of an allowance to women with grant of a non-contributory old-age children dependent on the nationality benefit to women with children may of the children of the mother in not be made dependent either on the question. nationality of the person concerned or 3. Regulation No 1408/71 does not on that of her children, provided that make any distinction between the the nationality in question is that of social security schemes to which it one of the Member States.

In Case 237/78

REFERENCE to the Court under Article 177 of the EEC Treaty by the Cour d'Appel [Court of Appeal], Douai, for a preliminary ruling in the action pending before that court between

Caisse Régionale D'Assurance Maladie [Regional Sickness Insurance Fund], Lille , (hereinafter referred to as "the Fund")

and

gives the following

JUDGMENT

Facts and Issues

The facts of the case, the course of the — Be the wife of an employed procedure and the observations sub­ person; mitted pursuant to Article 20 of the Protocol on the Statute of the Court of — Be of insufficient means; Justice of the EEC may be summarized as follows: — Have brought up at least five dependent children for at least nine years before their sixteenth birthday. I — Facts and procedure

(2) Under Article 1 of Decree No 50-76 Article L 640 of the French Social of 16 January 1950, as amended on 16 August 1956: Security Code provides for an "allocation aux mères de famille" [allowance for women with children]. — Those children must be of French Entitlement to that allowance depends nationality on the date on which on the following conditions: entitlement arises.

(1) Under Article L 640 of the Social Diamante Palermo (née Toia), of Italian Security Code the person concerned nationality, having been born on 8 July must: 1913 at Gizzeria (Italy), resident in France, the wife of an empolyed person and the mother of seven children, — Be aged at least 65; applied for that allowance to the Fund which by a decision of 7 September 1977 — Have French nationality; of its Commission de Recours Gracieux

[Appeals Board] refused her the Ambassador, Adolfo Maresca, acting as allowance on the ground that five of the Agent, assisted by the Avvocato dello children had possessed Italian nationality Stato, Franco Favara, and by the from birth. Commission of the European Comunities, represented by Marie-Jose "When that decision was disputed the Commission de Première Instance du Jonczy, a member of its Legal Contentieux de la Sécurité Sociale Department, acting as Agent, assisted by Henri Scheyvaerts and Francis Herbert, [Tribunal of First Instance for Social of the Brussels Bar. Security Appeals], Lille, by a decision of 21 March 1978, found in favour of the Having heard the report of the Judge- plaintiff on the ground that as a non- Rapporteur and the views of the contributory old-age benefit was Advocate General, the Court asked the involved, by virtue of the provisions of Fund to produce certain documents. Articles 2, 3 and 4 of Regulation No 1408/71, it must be available not only to French nationals but also to the nationals of other countries of the Community. II — Summary of the written observations submitted to On 18 April 1978 the Fund appealed the Court against that decision to the Cour d'Appel, Douai. The Fund points out that the Treaty The Fund stated that it had been auth­ leaves governments free to pursue the orized by way of administrative in­ demographic policy which they consider structions not to rely on the fact that the best. The allowance for women with mother did not have French nationality. children is essentially an instrument of demographic policy. The Cour d'Appel, considering that the solution to the legal problem before it The imposition of a condition con­ depended on the interpretation of cerning the nationality of the children Community provisions, decided to stay cannot be regarded as anything other proceedings and to submit the following than an incentive to bear and raise question to the Court of Justice pursuant children who will increase the French to Article 177 of the Treaty: national community. The period of employment which the husband is "What interpretation must be given to the provisions of Articles 2 (1), 3 (1) and required to have completed is very short (three months). Moreover, the women (3) and 4 (1) (c) and (2) of Regulation who apply for the allowance in question (EEC) No 1408/71 of 14 June 1971 with regard to the grant of an old-age benefit do not belong to the category of "workers" whose free movement the which, being of a non-contributory nature, is in principle reserved to French Treaty sought to ensure. nationals?" Similarly, Regulation No 1408/71 does The judgment making the reference, not apply to the allowance for women dated 10 October 1978, was received at with children. The preamble to the said the Court Registry on 30 October 1978. regulation suggests that it does not take account of benefits which are inspired by In accordance with Article 20 of the predominantly demographic consider­ Statute on the Protocol of the Court of ations. Justice of the EEC, written observations were submitted by the Fund, by Mrs As to Chapter 3, "Old age and death Palermo, by the Government of the (pensions)", of Title II, "Special Italian Republic, represented by its provisions relating to the various cat-

Article 3 of Regulation No 1408/71 According to the Government of the provides for equality of treatment as Italian Republic, the allowance in regards benefits and obligations. In question comes within the matters Article L 640 of the French Social covered by Regulation No 1408/71, as defined in Article 4 thereof. It is a Security Code no benefits are conferred on children, nor are any obligations welfare benefit typical of a social security imposed on them; they are merely one of scheme (although non-contributory); its the factors in the situation of the justification is old-age preceded by an claimant, such as age or insufficient intensive period of child-rearing and it is means. subject to the condition that the husband must have worked as an employed person.

Besides, under the system set up by Regulation No 1408/71, the same factor The Italian Government goes on to cannot create entitlement to more than examine the case-law of the Court. It one benefit of the same nature. Finally, if submits that according to that case-law, the regulation is considered applicable, amongst the recipients of the allowance the children must, if they are to be taken in question must be Included all elderly

JUDGMENT OF 12. 7. 1979 — CASE 237/78

obligations and . . . the same benefits . . . nationality of the applicant's children as the nationals of that State", having applies equally to French nationals and to foreigners. Secondly, it is one of the regard to paragraph (3) of that article. objective conditions giving entitlement to the benefit. Thirdly, to the extent to which the condition is objectively To the extent to which the question justified having regard to the nature and submitted refers only to the nationality purpose of the benefit, there cannot be of the recipient of the benefit, namely any discrimination, since that concept the wife of the migrant worker, an presupposes an arbitrary difference in answer to it can already be found in the treatment. The objective justification is case-law of the Court (Case 7/75 [1975] the fact that the objective condition is ECR 679).

CRAM v TOIA

The argument in favour of an affirmative That exception to the general application answer is that the prohibition on dis­ of the provisions of Regulation No crimination, contained in Article 3 (1) of 1408/71 to all the branches of social

Regulation No 1408/71 does not apply- security listed in Article 4 (1) of the regu­ solely to discrimination in form but also lation must be interpreted restrictively. to discrimination in substance or indirect Thus it cannot be extended, by analogy, to allowances for women with children, discrimination, that is to say that which belong to the category of old-age provisions which lay down requirements benefits. applicable both to a State's own nationals and to foreigners, but which in In conclusion, the Commission considers reality are more difficult for foreigners that the condition concerning the to satisfy (Case 55/77 Maris v Rijksdienst nationality of the children is not objectively justified and that therefore it voor Werknemerspensioenen [1977] ECR cannot be relied on, by virtue of Article 2327; Case 16/78 Choquet [1978] ECR 3 (1) of Regulation No 1408/71, as 2293). The effect of the condition against the wife of a migrant worker so concerning the nationality of the as to deny her the benefit of the children varies according as a French allowance for women with children national or a national of another provided for in Article L 640 of the Community State is involved. That Social Security Code. condition is more easily satisfied by a French mother. III — Oral procedure Moreover, the difference in treatment is At the hearing on 13 June 1979 oral not justified. Considerations of a demo­ argument was presented by the graphic nature have been accepted as Commission of the European Com­ justification for excluding certain munities, represented by Marie-José benefits from the scope of Regulation Jonczy and Francis Herbert. No 1408/71, as is shown by Article 1 (u) The Advocate General delivered his of the regulation. opinion at the hearing on 3 July 1979.

4 In this case the allowance for women with children was refused on the ground that five of the seven children of the mother were not of French nationality, but had held Italian nationality from birth. In the course of the dispute the Fund declared that it did not rely on the fact that the mother was not herself of French nationality.

5 Such are the circumstances in which the Cour d'Appel asks what interpret­ ation must be given to the provisions of Articles 2 (1), 3 (1) and (3) and 4 (1) (c) and (2) of Regulation (EEC) No 1408/71 of 14 June 1971 with regard to the grant of an old-age benefit which, being of a non-contributory nature, is in principle reserved to French nationals.

6 As regards the matters covered by Regulation No 1408/71, it follows from Article 4 (1) (c) and (2) thereof that the regulation applies to all legislation dealing with the branches of social security which concern old-age benefits, regardless of whether they provide for a contributory or a non-contributory scheme.

7 Article 5 of the regulation provides that "the Member States shall specify the legislation and schemes referred to in Article 4 (1) and (2)... in declarations to be notified and published in accordance with Article 96". The declaration of the French Republic (Official Journal 1973 C 12, p. 11) includes the allowance for elderly employed persons and the allowance for women with children (Volume VII) of the Social Security Code).

CRAM v TOIA

8 The fact that a Member State has mentioned such an allowance in its declaration must be accepted as proof that the benefits concerned are social security benefits within the meaning of Regulation No 1408/71.

JUDGMENT OF 12. 7. 1979 — CASE 237/78

14 Therefore the condition concerning the nationality of the children must be regarded as indirect discrimination, unless it was justified by objective differences.

15 Such a justification cannot be based on the fact, relied on by the Fund, that the purpose of the allowance for women with children is to increase the birth rate in France. In the first place, the Cour d'Appel, which alone has jurisdiction to interpret the French legislation in the present proceedings, has described the allowance for women with children as an old-age benefit of a non-contributory nature; secondly, Regulation No 1408/71 does not make any distinction between the social security schemes to which it applies according to whether those schemes do or do not pursue objectives of demographic policy.

16 As an old-age benefit is involved, the condition concerning the nationality of the children cannot be regarded as a rule designed to prevent the overlapping of similar benefits under the legislation of different Member States. If such a problem arises, a solution must be found for it within the context of Community rules in accordance with criteria normally applicable to cases of that type.

17 No other arguments to show that the condition concerning the nationality of the children is based on an objective difference have been advanced before the Court. It must be inferred from that that the condition in question constitutes indirect discrimination between nationals of Member States subject to the social security schemes covered by Regulation No 1408/71.

As these proceedings are, 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 on costs is a matter for that court.

On those grounds,

THE COURT,

in answer to the question referred to it by the Cour d'Appel, Douai, by a judgment of 10 October 1978, hereby rules:

Articles 2 (1), 3 (1) and 4 (1) (c) and (2) of Regulation No 1408/71 must be interpreted as meaning that the grant of a non-contributory old-age benefit to women with children may not be made, dependent either on the nationality of the person concerned or on that of her children, provided that the nationality in question is that of one of the Member States.

Kutscher Mertens de Wilmars Mackenzie Stuart Pescatore Sørensen