C-141/88

3. Mr Alan Jordan (hereinafter referred to as 'Mr Jordan') is a British national who worked as an employed person in the United Kingdom and then in France. With effect from 1 January 1979 an old-age 1. In this reference for a preliminary ruling pension was granted to him in those two the Cour de cassation of the French States. Mr Jordan never agreed with the Republic has submitted to the Court two amount of the pension which was granted to questions on the interpretation of Article 51 him by the competent French institution, the of Council Regulation No 1408/71 on the Caisse nationale d'assurance vieillesse des application of social security schemes to travailleurs (National Old-Age Pension employed persons, to self-employed persons Fund for Employees, hereinafter referred to and to members of their families moving as 'the Fund'), and he brought legal within the Community. proceedings which have been pending since 1979. It is in the framework of those proceedings that questions have now been referred to the Court. More specifically, these questions stem from the fact that the applicable French legislation was amended in 1983. In order that these questions may be fully understood, it is therefore necessary to summarize the French rules relating to 2. The provision in question forms part of a the grant of old-age benefits, both before complex system of rules set out in Chapter 3 that amendment and afterwards. The of Title III of Regulation No 1408/71. This following account is essentially based on the chapter contains a certain number of observations submitted by the French provisions relating to old-age and death Government. benefits. The provisions relevant to this case are Article 46 (which contains the rules relating to the award of benefits in the case of workers who have been subject to the legislation of two or more Member States), Anicie 50 (which guarantees, under certain 4. In France, the amount of the old-age conditions, the right to minimum old-age pension was and is calculated by applying benefits) and Article 51 (revalorization and two coefficients to the average salary of the recalculation of benefits). For a fuller revalorized '10 best years'. The first coef­ account of these provisions I refer to the ficient is the number of 'proven' quarters Report for the Hearing (section 1.1). under the French social security system. As

P = the annual amount of the pension; S = the average salary of the '10 best' 5. At the hearing it became clear that it is years; the application of the (former) French rules N = the number of 'proven quarters'; relating to the minimum benefit which is at T = the applicable rate. the nub of the dispute between Mr Jordan and the Fund. In his observations, Mr Jordan claims in this respect that, under the The legislation applicable at the time when old French system, the grant of the old Mr Jordan retired also provided for a workers allowance was always accom­ minimum old-age benefit. The pension, panied, as regards workers of French determined in accordance with the nationality, by the grant of a supplementary aforementioned method, could not be less benefit payable by the fonds national de than the amount of the allocation aux vieux solidarité (National Solidarity Fund). This travailleurs salariés (old workers allowance), latter benefit was not an old-age benefit provided that the person concerned could based on contributions, but rather a prove at least 60 quarters. If that condition minimum subsistence allowance not linked could not be met, the amount of the old to contributions (in the sense that it was not workers allowance was reduced pro rata the based on contributions paid by the recipient number of proven quarters. of that allowance. Again according to Mr Jordan's observations, the Fund granted him in 1979 only an old workers allowance, The rules for determining the first coef­ without granting him (and this is what he ficient (number of proven quarters) were challenged) the benefit of a non-con­ amended with effect from 1 April 1983. · tributory minimum benefit. In Mr Jordan's

In Mr Jordan's view this state of affairs is contrary to Article 50 of Regulation No 1408/71. The main dispute thus centres on the question whether, under Article 50, Mr 6. Before examining the questions asked by Jordan could also claim the benefit of the Cour de cassation, I would point out the the additional non-contributory minimum narrow compass of this case as it has been benefit either before or after the amendment referred to the Court. As I have already of the French legislative provisions. said, the cour d'appel dismissed Mr Jordan's claim as regards the application of Article 50 of Regulation No 1408/71 to the former French system. Given that none of the grounds of appeal relate to this part of the cour d'appel's judgment, the latter has the effect of res judicata. It follows that the only question before the Cour de cassation is As far as the former French legislation is whether, on the basis of Article 51 of Regu­ concerned, the cour d'appel, Poitiers, lation No 1408/71, the new French system decided, in a judgment of 14 February 1985 (and, therefore, also the new rules relating that Mr Jordan could not claim the to the grant of a minimum old-age benefit supplementary benefit from the fonds summarized above) must apply in Mr national de solidarité on the basis of Article Jordan's case. Should the reply to this 50. At the same time the cour d'appel took question be in the affirmative, Mr Jordan the view that the new French regulations may be entitled, in appropriate circum­ had to be applied to Mr Jordan on the basis stances, to the grant of an additional of Article 51(2). Mr Jordan was therefore amount on the basis of the new regulations entitled to a recalculation (under Article 46) pursuant to Article 50. This latter question, of his old-age benefit under the new regu­ concerning the application of Article 50 to lations, and accordingly, pursuant to Article the new French system, has not however 50, an additional amount was to be granted been referred to the Court, since the Cour to him if the amount of his recalculated de cassation has merely raised a question benefit was lower than the minimum benefit relating to the interpretation of Article 51. granted pursuant to the new French legis­ Moreover, I shall come to the conclusion, in lation. paragraphs 11 and 13 infra, that Article 51 cannot be relied on to make amending 3 — The French Government observes thai Mr Jordan (under the former system which is allegedly still applicable to him), provisions of national law, which are not if his income justifies doing so and he makes a request to intended to govern pre-existing situations, that effect, may claim an additional benefit from the fonds national de solidarité, but that his average annual reva- immediately applicable to the future legal lorized salary on I April 1983 exceeded lhe amount which confers entitlement to the additional benefit. effects of already existing situations. The

As is apparent from the preceding expo­ sition it is above all the reply to the second question which will be relevant in resolving the main dispute. In fact, if it is assumed (as 9. I would first of all refer to the Sinatra I shall do) that Article 51(2) does not in 5 judgment. The main dispute in that case principle preclude the application of the concerned a worker of Italian nationality, abovementioned transitional national pro­ Mr Sinatra, who received an invalidity visions, the first question is merely of and/or old-age pension both in Belgium academic interest. Nevertheless, I shall and in Italy. Since Mr Sinatra's spouse took examine that question first because the Court has not yet had occasion to interpret 4 — Judgment of 21 June 1988 in Case 197/86 Brown v Article 51 in a situation such as that Secretary ofSlate for îco//am/[1988] ECR 3205. underlying the main dispute. 5 — Judgment of 2 February 1982 in Case 7/81 Sinatra [1982] ECR 137. '

CAISSE NATIONALE D'ASSURANCE VIEILLESSE DES TRAVAILLEURS SALARIES v JORDAN

up paid employment, his Belgian pension 'at the "method of determining" or " the rules the married rate' was converted into a for calculating" benefits. Paragraph 1 of pension at the 'single rate' which was a that article provides that alterations of the considerably lower amount, pursuant to first type must be applied directly to the national rules against the overlapping of benefits paid without any need for the recal­ benefits. The question arose as to the culation expressly provided for in Article manner in which this alteration in Mr 51(2) in respect of alterations of the second Sinatra's situation should be treated for the type. purposes of Article 51 of Regulation No 1408/71.

Such exclusion may not, in the absence of appropriate specific provisions, be extended to alterations in benefits due to a change in 'The right thus conferred upon the migrant the personal circumstances of the insured, worker to benefit from the most favourable such as his transition from the "household" social security system implies in principle category to the "single" category, that, whenever there is an alteration in the particularly as it is not possible to envisage benefits granted under that system, a fresh an application, by analogy, of Article 51(1) comparison between the national system and in such cases, since changes in the personal the system of aggregation and appor­ circumstances of insured workers, as tionment is to be carried out in accordance opposed to the "reasons for adjustment" with Article 46 of Regulation No 1408/71, referred to in that paragraph, are not of a in order to determine which system is the general nature' (paragraphs 8 to 11 of the most advantageous following the alteration. judgment).

The analysis contained in the Sinatra b However, in order to reduce the adminis­ judgment was confirmed in the Cinciuolo trative burden which a fresh examination of judgment in which the facts were similar. the insured's situation following every alteration in benefits received would represent, Article 51 of Regulation No 1408/71 establishes a distinction between 10. Whereas the first paragraph of Article alterations and benefits "by a fixed 51, as is clear from the aforementioned percentage or amount" resulting from "an increase in the cost of living or changes in 6 _ Judgment of 1 March 1984 in Case 104 /83 Ciucinolo 104/ [ 1984 1984]] ECR 1285 1285.. in particular at paragraphs II and 12 the level of wages or salaries or other Sec also the ļudgmcnt of 4 May 1988 in Case 83 /87 Viva 83/ reasons for adjustment" and alterations in 1988)) ECR 2521 [1988 2521..

judgments, is a provision allowing for dero Community legislature and the national gations, the second paragraph is the general legislature under Article 51 of Regulation provision. In the Sinatra and Cinciuolo No 1408/71. It must therefore be assessed judgments, that general provision was in a wider context inasmuch as it raises the construed in the case of changes in the problem of the scope of Community rules personal situation of the insured persons, contained in Regulation No 1408/71.

the insured person. It therefore seems to me to the suggestion in the observations of the irrefutable that the rule contained in Article French Government, of the Fund and of the 51(2) that 'whenever there is an alteration Commission, Mr Jordan is not seeking in the benefits . . ., a fresh comparison 'retroactive application' of the new rules, in between the national system and the system other words the application of the new rules of aggregation and apportionment is to be to situations occurring under the old rules, carried out in accordance with Article 46 of in this case an existing entitlement to Regulation No 1408/71, in order to benefits, but to have 'immediate effect' determine which system is the most advan given to the new French rules, in the sense

rules. The Court is therefore asked to reply 7 — Sec paragraph 8 of the Sinatra judgment, already quoted in extenso at paragraph 9 of this Opinion. to the question whether the applicable

provisions of Community law (in this case dispute in that case concerned an Article 51 of Regulation No 1408/71) application by an Italian national who had preclude the introduction by a national established himself as a self-employed legislature of legislative amendments having craftsman in Germany. The German legis­ such effect (that is to say preserving the lation provided for a derogation from the earlier rules). compulsory social insurance scheme for craftsmen who had paid contributions for not less than 216 months in respect of an occupation for which pension insurance was compulsory. Mr Brunori considered that, 8 for the purposes of the application of that 12. In the first Pinna judgment, the Court rule, the insurance periods which he had held in general terms as regards the legal already completed in Italy should also be basis of Regulation No 1408/71, namely taken into consideration. For that reason the Article 51 of the EEC Treaty that: German court making the reference asked the Court whether Article 45 of Regulation No 1408/71, on the taking into account of periods of insurance completed abroad for the purpose of the acquisition, retention or 'it must be observed that Article 51 of the recovery of the right to benefits, was also to Treaty provides for the coordination, not be applied by analogy with regard to the the harmonization, of the legislation of the existence of a social insurance obligation. Member States. As a result, Article 51 leaves The Court endorsed the view of the in being differences between the Member Commission and replied in the negative, States' social security systems and, conse­ holding that Regulation No 1408/71 is quently, in the rights of persons working in intended only to ensure coordination the Member States. It follows that between national social security laws. In substantive and procedural differences those circumstances, Article 45 of that regu­ between the social security systems of indi­ lation contemplates the aggregation of vidual Member States, and hence in the insurance periods only for the purpose of rights of persons working in the Member the acquisition, retention or recovery of the States, are unaffected by Article 51 of the 9 right to benefits. As such it does not deal Treaty' (paragraph 20 of the judgment). with questions relating to affiliation and cessation of affiliation to the various social security schemes, which are matters for the national legal system alone (see paragraphs 5 and 6 of the judgment). In the Court's case-law, this principle has emerged several times in connection with specific provisions of Regulation No 1408/71. One example is to be found in the ,0 Brunori judgment of 1979. The main

security scheme of the Member State in 'Both Article 51 of the EEC Treaty and which he takes up employment for the first Regulation No 1408/71, adopted in time, where this right is denied to him on pursuance of that provision, merely provide the basis of the national provisions alone. In for the aggregation of periods of insurance its judgment the Court held, inter alia: completed in the various Member States. On the other hand, those provisions do not govern the conditions under which these periods of insurance are completed' (paragraph 15 of the judgment). 'Neither Article 18 nor Article 46 of Regu­ lation No 1408/71 provides the answer to that question. Those provisions in fact govern the aggregation of qualifying periods and the effects thereof ..., in the case of a 13. The Court's case-law shows a clear person who is or has been affiliated as a division of competence. On the one hand worker to the national social security Regulation No 1408/71 requires the scheme in one Member State, when, on the national social security institution to take other hand, he has also completed quali­ account of periods of insurance or residence fying periods in another Member State. completed abroad when determining inter They do not govern the preliminary alia the right of migrant workers to old-age question of ascertaining the conditions benefits, but on the other the acquisition, under which a national of a Member State retention or recovery of such a right may or must be affiliated to the social depends in the first place on the applicable security scheme of another Member State national legislation. In the light of this where he is an employed person' (paragraph division of competence, it would appear 8 of the judgment). hard to deny that, as Community law stands at present, the determination of the temporal effect of a national rule falls within the competence of the national legis­ lature. If it is accepted that the national '. .. it is for the legislature of each Member legislature is competent to regulate the affil­ State to lay down the conditions creating iation or cessation of affiliation to a social the right or the obligation to become security scheme (the Bmnori and Coonan affiliated to a social security scheme or to a judgments) and to determine the conditions particular branch under such a scheme under which periods of insurance are provided always that in this connection completed (Schmitt judgment), it must also there is no discrimination between nationals be accepted as being competent to regulate of the host State and nationals of the other the temmporal effect of such rules provided Member States' (paragraph 12 of the that it does not thereby infringe the rules on judgment). aggregation in Regulation No 1408/71 and does not introduce any discrimination prohibited by the Treaty or by Regulation No 1408/71.

14. I consider that the foregoing elements are sufficient to reply to the national court's That judgment was confirmed and questions in the manner indicated in the developed in the judgment of 17 December concluding part of this Opinion. However, 1981 in Case 22/81 Browning [1981] ECR should the Court take a different view as 3357, in which the Court held that Article regards the second question and consider 50 was to be interpreted as meaning that a that, under Community law, the French 'minimum benefit' exists only where the legislative amendments should be regarded legislation of the State of residence includes as having immediate effect, it may be useful a specific guarantee the object of which is to to indicate, in the light of the Court's ensure for recipients of social security case-law, the criteria which the national benefits a minimum income which is greater court should use in determining which than the amount of the benefit to which elements of the minimum benefits under the they are entitled on the basis of their new French legislation are to be regarded as periods of insurance and their contributions 'a minimum benefit' within the meaning of alone (in other words pursuant to the rules Article 50. for calculation laid down in Article 46).

The Court's case-law with regard to this question once again illustrates the division of competence, outlined above, between the In two earlier judgments on references for a Community legislature and the national preliminary ruling, the Court has already legislature. had occasion to deal with the non-contributory element of the minimum old-age benefit provided for in the new French legislation. The underlying dispute 15. In its judgment of 30 November 1977 in those two cases specifically concerned the Case 64/77 Torri [1977] ECR 2299, the supplementary allowance paid by the fonds Court stated that: national de solidarité, and the Court was

13 — See the judgment of 24 February 1987 in Joined Cases 379/85 to 381/85 and 93/86 Giletti [1987] ECR 955, at paragraph 12, and the judgment of 17 December 1987 in Case 147/87 Zaoui [1987] ECR 5511, in particular at paragraph 9.