C-118/82

JUDGMENT OF 6. 10. 1983 — JOINED CASES 118 TO 123/82

of their Community pension within equivalent in order to cover the the meaning of Article 2 of Annex liabilities assumed by the Community VIII to the Staff Regulations, the scheme for periods in respect of second paragraph of Article 2 (4) of which it previously had no Regulation No 2615/76 does not take responsibility. away any right of former establish­ Since the establishment of the actu­ ment staff who are transferred into arial equivalent by the original social the category of temporary staff. It is security institution and its reassess­ intended only to specify what is ment on the basis of the rules appli­ already a consequence of Article 39 cable under the Community pension (2) of the Conditions of Employment, scheme are based on different particu­ which is, moreover, in accordance lars and considerations regarding the with the general principles governing history of those concerned, their the temporal effect of laws. future prospects, the amount of 3. The only machinery compatible with contributions and the nature and the sound financial management of the amount of benefits, it does not seem Community pension scheme in the abnormal that the determination of event of retroactive recognition of the years of pensionable service to periods of insurance completed under be taken into account for the a national pension scheme is the Community pension leads to a application of Article 11 of Annex different figure from the years of VIII to the Staff Regulations which pensionable service taken into account allows the transfer of the actuarial by the national institution.

GIUSEPPINA FIOMBO-BREBBIA ( Case 123 / 82 ),

temporary staff of the Commission paid from appropriations in the research and investment budget and assigned to the Joint Research Centre at Ispra, represented for the written procedure by Cesare Ribolzi of the Milan Bar , and for the oral procedure by Giuseppe Marchesini of the Vicenza Bar , with

CELANT v COMMISSION

an address for service in Luxembourg at the Chambers of Victor Biel, 18 A Rue des Glacis,

applicants, v

COMMISSION OF THE EUROPEAN COMMUNITIES, represented by Eugenio de March, a member of its Legal Department, acting as Agent, assisted by Paolo de Caterini of the Rome Bar, with an address for service in Luxembourg at the office of Oreste Montako, a member of its Legal Department, Jean Monnet Building, Kirchberg,

JUDGMENT

Facts and Issues

The facts of the case, the course of I — Facts the procedure and the conclusions, submissions and arguments of the parties The six applicants were employed as may be summarized as follows: established staff at the Joint Research

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CELANT v COMMISSION

Nevertheless, the Commission decided to the national social security schemes to apply in the present case by analogy which they had previously belonged as Article 11 (2) of Annex VIII to the Staff establishment staff depending on their Regulations, which gives an official who place of employment. enters the service of the Communities after leaving the service of a government administration or of a national or inter­ national organization or of an under­ At the Joint Research Centre at Ispra a taking the right, on becoming established notice already published in Staff Courier with the Community, to pay to it either: No 391 of 14 June 1978 was circulated on 13 July 1978 informing temporary staff previously affiliated to the Italian social security scheme, the Istituto — the actuarial equivalent of retirement Nazionale della Previdenza Sociale, that pension rights acquired by him in the the transfer of their pension rights to the government administration, national Community scheme was now possible as or international organization or the result of an agreement made in undertaking; or Rome on 2 March 1978 between the Istituto Nazionale della Previdenza Sociale and the Community.

— the sums repaid to him from the pension fund of the government administration, organization or Those concerned were asked to make an undertaking at the date of his leaving application for a transfer before 13 De­ its service. cember 1978 and to complete a ques­ tionnaire for that purpose.

In such a case the institution in which the official serves must determine, taking A circular dated 10 April 1979 informed into account his grade on establishment, the temporary staff concerned that they the number of years of pensionable could postpone their ultimate decision service with which he is to be credited until they were given precise information under its own pension scheme in respect as to the number of years of pensionable of the former period of employment, on service which would be taken into the basis of the amount of the actuarial account in determining their Community equivalent or sums repaid. pension, on the basis of the actuarial equivalent to be transferred.

time they were asked to make a decision Upon hearing the report of the Judge- within 30 days in relation to the transfer Rapporteur and the views of the of any pension rights acquired under the Advocate General the Court (Second various national social security schemes. Chamber) decided to open the oral procedure without any preparatory inquiry. Within a short time the applicants confirmed that they opted for the For the purposes of the hearing the transfer of their pension rights to the Court (Second Chamber) requested the Community scheme, but they expressed parties to confine their oral argument to reservations as to the method of calcu­ the first submission made by the appli­ lating the years of pensionable service cants and not to discuss admissibility or attributed to them. the second and third submissions, on which the Court considered it had In September 1981, or in one case obtained sufficient information from the October 1981, the applicants submitted written procedure; it also requested the complaints to the Commission pursuant applicants not to go more fully into the to Article 90 (2) of the Staff Regulations "additional considerations" set out in the concerning the fact that in determining reply. their Community pension rights the Commission had not taken into account In addition, the Commission was asked all the years of pensionable service to produce an expert capable of completed by them as establishment staff. explaining to the Court in non-technical language the system of transfer contem­ plated by Article 11 (2) of Annex VIII to the Staff Regulations and the method of II —• Written procedure calculation used in determining the rights of the applicants. When their complaints brought no response within four months of being lodged the applicants brought actions, III — Conclusions of the parties the first two on 5 April 1982 (Cases 118/82 and 119/82) and the remaining The applicants each claim that the Court four on 6 April 1982 (Cases 120/82, should: 121/82, 122/82 and 123/82), challen­ ging the Commission's implied rejection of their complaints. Annul the measure whereby the Com­ mission took into account only partially in calculating the Community retirement Express decisions rejecting the com­ pension the length of service completed plaints were made in March 1982. by the applicant prior to his or her appointment as a member of the temporary staff; By order dated 29 April 1982 the Court (Second Chamber) decided with the Declare that the Commission is under an agreement of the parties to join the six obligation to recognize for the purpose cases for the purposes of the proceedings of calculating the pension the entire and judgment. period of service completed by the applicant as its employee; The written procedure followed the normal course. Order the defendant to pay the costs.

For the purpose of admissibility the The injury to the applicants' individual relevant measure is not the notification interests was revealed only at a later to the applicants of the definitive calcu­ stage when two essential conditions had lation of their years of service prior to been fulfilled: the exercise by the person their engagement as temporary staff but concerned of the option to repurchase the decision adopted previously to apply the years of previous pensionable service to former establishment staff Article 11 for the determination of the Community (2) of Annex VIII to the Staff Regu­ pension, and the calculation of those lations. The notification of the definitive years of pensionable service as years calculation was merely the logical counting towards a Community pension. consequence and contemporaiy applica­ tion of a decision adopted long before. That understanding was shared by the administration itself, which invited those The decision to apply Article 11 (2) of concerned to specify their employment Annex VIII to the Staff Regulations was prior to their appointment as temporary brought to the attention of the staff staff without prejudice to the ultimate concerned in June and July 1978; it is decision which they would be called that which constitutes the measure upon to take when they knew the capable of adversely affecting the assessment of the actuarial equivalent of applicants within the meaning of Articles the pension rights they had acquired 90 and 91 of the Staff Regulations. The previously. alteration of the applicants' position under the Staff Regulations is a direct In those circumstances a complaint result of that decision which permitted challenging normative decisions of a them to ascertain precisely and in detail general scope not personally notified to the effects and limits of their personal those concerned or published in the situation as regards the determination of official information media, and adopted

(b) If the Commission found that there was a lacuna and felt the need to have B — Substance recourse to analogy the latter should have been drawn not with previous employment outside the Community, in which the Commission has no The applicants base their applications on responsibility, but with employment as an alleged infringement of the Treaty official in the Community. The position and of the rules of law relating to of former local and establishment staff is its implementation inasmuch as the almost identical to that of auxiliary staff application by analogy of Article 11 (2) since in both cases the employment is of Annex VIII to the Staff Regulations is with the Commission; the principles inappropriate in their case, infringement expounded by the Court in its judgment of the principle of non-discrimination of 1 February 1979 in Case 17/78 and misuse of powers; in their reply they (Deshormes v Commission [1979] ECR put forward "additional considerations" 189) are thus applicable. Moreover, the based on the Commission's application Commission takes into account for the of a weighting factor. purposes of the pension the whole period spent as an auxiliary in all cases where the official has performed during the The Commission considers all the period for which he was an auxiliary the submissions to be unfounded. same duties as those entrusted to him in the department in which he has subse­ quently been established. As regards former local and establishment staff there Application by analogy of Article 11 (2) is no doubt that they continue to of Annex VIII to the Staff Regulations perform in their new capacity the same duties as they carried out in the past. The applicants maintain that the application to their case by analogy of Article 11 (2) of Annex VIII to the Staff Regulations is unlawful. (c) Objections concerning the financing of the providence scheme in relation to previous employment cannot be accepted. (a) That provision governs a situation which is different from theirs in sub­ stance. Its wording and spirit show that it was obviously intended to take into The Commission is responsible for the account as far as possible periods share of the financing for which the of work completed otherwise than in employer is liable. It is, moreover, the service of the Communities. The required to take part in financing the applicants, on the other hand, were pension schemes for its own officials;

Neither the relative shares nor the amount of the contributions can there­ fore justify the measures adopted by the Commission. (e) The judgment of the Court of 1 April 1971 in Case 54/70 (Landra v Com mission [1971] ECR 311), cited by the Commission, is irrelevant to the It is also necessary to emphasize that present case: at issue here is not the over­ recognition of all the previous years of lapping of two pension schemes, but an pensionable service of the applicants option for a single Community insurance would in no way have conferrred on scheme. Moreover, the applicants' affili­ them an unfair financial advantage over ation to an insurance scheme other than those who had been affiliated to the the Community scheme is attributable to Community pension scheme from the the institutions alone and the beginning. The contributions paid by the Commission cannot hold against the applicants to the Istituto Nazionale applicants a situation which it has itself were higher than those paid under the created. Community scheme, the proportion paid by the institution to the Istitutio Nazionale was not less than that paid for its own established officials, and transfer of the actuarial equivalent to the The Commission is of the opinion that in Commission would put it in the same the present case it has merely applied the position as it would have been if it had law and followed the case-law of the assumed responsibility for local and Court. establishment staff as regards social security from the beginning.

(a) The provision in Regulation No 2615/76 to the effect that only the years of service completed by staff as The reciprocity between the respective temporary staff are to be taken into obligations and rights of the parties is account for the purpose of calculating practically the same as in the relationship the years of pensionable service to be between the Commission and established counted in computing the Community officials. pension applies the basic principle governing the whole Community social security scheme defined in Article 83 of the Staff Regulations. The latter establishes a close correlation between (d) In their reply the applicants claim the acquisition of the retirement pension that Regulation No 2615/76 is unlawful and the financing by the person

The judgment in the Deshormes case was given in a context completely different from that of the present case. Moreover, the mechanism for converting the actuarial equivalent of pension rights previously acquired into years of (c) The application in the present case pensionable service to be taken into of Article 11 (2) of Annex VIII to the account for the purpose of the Staff Regulations is consistent with the Community pension certainly does not decision in the Landra case. The result of always have disadvantageous results for that application must be that the amount those concerned; the result depends in transferred is credited to the employee in each case on the weight attached to the years of pensionable service calculated value of the various factors involved in according to the rules and subject to the making the conversion (the amount restrictions normally applied by the transferred, age, grade on establishment, Communities. Any additional charge on and so on). the Community budget in order to allow complete assimilation of the previous period of service if the actuarial equiv­ alent proved inadequate would have no legal justification, would constitute a breach of the principle of mutuality on (d) The objection that Regulation No which the whole Community social 2615/76 is unlawful is a new issue raised security scheme is based and, in the final during the proceedings in breach of

CELANT v COMMISSION

Articles 38 and 42 of the Rules of (c) It is true that the attribution to the Procedure and is therefore inadmissible. applicants of their new status has improved their legal position and reduced the most blatant discrimination In any event no legal argument has been vis-à-vis their colleagues who are adduced in support of the objection established officials; nevertheless their and the regulation in question merely situation remains precarious, particularly implements the fundamental principle of as regards social security. the Community social security scheme as defined in Article 83 of the Staff Regu­ lations. The Commission challenges the ap­ plicants' argument on both legal and factual grounds. The principle of non-discrimination

JUDGMENT OF 6. 10. 1983 — JOINED CASES 118 TO 123/82

result of a definite choice of legislative tunity was offered to the applicants of policy made deliberately by the Com­ converting their entitlement vis-à-vis the munity institutions with the aim of national insurance institutions at the rate reconciling a maximum number of of exchange in force at the date of guarantees for staff under the Staff transfer. Regulations with the flexibility in­ dispensable to the organization of re­ search; moreover, the position of such staff is not as unfavourable as the The Commission points out that this is a applicants maintain, especially as regards completely new claim aimed at enlarging the retirement scheme. the object of the originating applications, made without any prior complaint under Article 90 of the Staff Regulations and thus wholly inadmissible.

The submission concerning misuse of powers In any event, in order to determine the basic salary of officials during 1976, when the periodic adjustment of salaries The applicants maintain that Article 11 took place not by means of an (2) of Annex VIII to the Staff Regu­ adjustment of the salary scales but by lations has in the present case been put applying a weighting, it was necessary to to a purpose other than that intended apply the weighting in force at the time by the legislature and has created, to the figure taken from the scale. moreover, a manifestly unjust and unlawful situation: unlawful because it is intended to govern a technically and substantively different case; unjust because it assimilates employment within the Community with employment V — Oral procedure outside it.

2 It appears from the file that the applicants were originally employed as "establishment staff" at the Joint Research Centre at Ispra and that in that capacity they were affiliated to the Italian social security scheme operated by the Istituto Nazionale della Previdenza Sociale (hereinafter referred to as "the Istituto Nazionale").

3 Council Regulation No 2615/76 of 21 October 1976 amending Regulation No 259/68 as regards the Conditions of Employment of Other Servants of the European Communities (Official Journal L 299, p. 1) abolished the status of establishment staff and made the applicants temporary staff under Article 2 of the Conditions of Employment of Other Servants, to which henceforth a new category was added, defined by the new subparagraph (d) to Article 2 thus:

"(d) Staff engaged to fill temporarily a permanent post paid from research and investment appropriations and included in the list of posts appended to the budget relating to the institution concerned."

4 Regulation No 2615/76 also brought the former establishment staff into the Community pension scheme by amending Article 39 (2) of the Conditions of Employment to read as follows:

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" On leaving the service, a servant within the meaning of Article 2 (c) or (d) shall be entitled to a retirement pension or severance grant as provided for in Title V, Chapter 3 of the Staff Regulations and Annex VIII to the Staff Regulations."

8 On 2 March 1978 an agreement was made between the Communities and the Istituto Nazionale for the purpose of transferring to the Community scheme the pension rights of staff previously affiliated to the Italian pension scheme.

CELANT v COMMISSION

9 Following that agreement the Commission published an announcement in Staff Courier No 391 of 14 June 1978. Shortly afterwards, on 13 July 1978, it circulated the same notice to the Joint Research Centre at Ispra to bring the agreement to the notice of those concerned and fixed 13 December 1978 as the final date for submitting requests for a transfer. A circular of 10 April 1979 informed the temporary staff concerned that they might postpone their final decision until they were given exact details of the years of pensionable service calculated for the purpose of determining their Community pension, on the basis of the actuarial equivalent to be transferred.

10 The applicants, who had given notice of their intention to take advantage of that opportunity, were notified in June and July 1981 of the precise number of years of pensionable service with which they were to be credited; at the same time they were asked to make a final decision on the matter within 30 days.

11 All the applicants confirmed their wish to exercise the option of transferring their pension rights to the Community scheme, but they expressed reser­ vations as to the method of calculating the years of pensionable service with which they were to be credited.

12 Subsequently they brought complaints under Article 90 (2) of the Staff Regu­ lations concerning the Commission's failure to take into account in determining their Community pension rights all the years of pensionable service completed by them as establishment staff. When those complaints received no answer within the period specified in the Staff Regulations the present applications were brought on 5 and 6 April 1982.

Substance

16 The applicants' complaints are attributable to the fact that the actuarial equivalent established by the Italian institution has been reassessed by the Community according to its own actuarial rules with the result that the number of years of pensionable service credited to the applicants is appreciably less than the period of their employment at the Joint Research Centre of the Community. The applicants do not deny that the existing actuarial rules have been correctly applied on both sides; their claim relates to the issue whether by applying its own actuarial rules the Community may reduce the years of pensionable service taken into account in determining

CELANT v COMMISSION

their Community pension to a period shorter than the time for which they had actually been employed.

20 That issue must be disregarded as being out of time. It was introduced only in the reply and did not enable the Commission to submit a proper defence, especially as its scope is not adequately explained in the documents submitted by the applicants.

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21 As for the submissions based on breach of the principle of non-discrimination and alleged misuse of powers, they overlap in fact with the first submission concerning the alleged false analogy between the position of the applicants and that of persons contemplated by Article 11 (2) of Annex VIII. Those submissions may therefore be considered together.

24 Quite apart from those considerations , the issues raised by the applicants concerning the validity of the transitional provisions in Regulation No 2615/76 and the measure adopted by the Commission are not well founded.

CELANT v COMMISSION

25 When it decided to abolish the status of establishment staff and to transfer such staff to the category of temporary staff the Council gave former establishment staff, by means of an addition to Article 39 of the Conditions of Employment, the right to a Community pension in accordance with the Staff Regulations and Annex VIII thereto with effect from the time they became temporary staff. By means of the transitional provision in the first paragraph of Article 2 (4) of Regulation No 2615/76 the Council enabled, in the applicants' interests, the length of their service as establishment staff to be recognized for the purpose of the condition referred to in the first paragraph of Article 77 of the Staff Regulations, which makes entitlement to a pension conditional upon having completed at least ten years' service. The second paragraph of Article 2 (4) of Regulation No 2615/76, the validity of which the applicants challenge, states that the same period of service is not to be taken into account in calculating the years of pensionable service which determine the amount of pension within the meaning of Article 2 of Annex VIII to the Staff Regulations. The provision does not remove any of the applicants' rights since it is intended only to specify what is already a consequence of Article 39 (2) of the Conditions of Employment and which is, moreover, in accordance with the general principles governing the temporal effect of laws. The Council was under no obligation to make transitional provisions in favour of the applicants more advantageous than those arising from Regulation No 2615/76.

28 Since the establishment of the actuarial equivalent by the original social security institution and its reassessment on the basis of the rules applicable under the Community's pension scheme are based on different particulars and considerations regarding the history of those concerned, their future prospects, the amount of contributions and the nature and amount of benefits, it does not seem abnormal that the determination of the years of pensionable service to be taken into account for the Community pension leads to a different figure from the years of pensionable service taken into account by the national institution. Since such years of pensionable service have relevance only in relation to benefits to which they give entitlement under the various national and Community schemes, they are not comparable inter se save to bring into account in actuarial terms an assessment both of the personal position of each person concerned and the general characteristics of the social security schemes in question. The applicants, who have confined themselves to making a comparison between themselves and Community officials, have produced no factor capable of raising doubt as to whether the actuarial formulae used by the Community properly translate the relationship between the actuarial equivalent reached by the Italian institution and the reassessment thereof according to the criteria of the Community scheme.

29 It follows from all the foregoing that in proposing to the applicants a transfer to the Community pension scheme on terms which are compatible with the Staff Regulations the Commission has not acted unlawfully in their respect, that it has not discriminated against them and that it has not misused its powers.

On those grounds,

THE COURT (Second Chamber)

hereby:

1. Dismisses the applications.

2. Orders the Commission to bear its own costs and one third of the applicant's costs, the remainder of their costs to be borne by the applicants.

Pescatore Due Bahlmann