C-228/88

BRONZINO

O P I N I O N O F M R A D V O C A T E GENERAL JACOBS delivered on 17 O c t o b e r 1989 *

My Lords, Augsburg, Federal Republic of Germany. His wife and seven children reside at Ercolano in the province of Naples (Italy). He has received family allowances from the Kindergeldkasse (Child Benefit Fund) since 1. These cases come before the Court by January 1985 in respect of four of his way of references for preliminary rulings by, children. In March 1985, he applied for in Case C-228/88, the Bayerisches Landes- family allowances in respect of his three sozialgericht (Higher Social Court of other children, who were born in 1964, Bavaria), and, in Case C-12/89, the 1966 and 1967 respectively. He produced Bundessozialgericht (Federal Social Court), various certificates from the Ercolano Federal Republic of Germany. Although the Employment Office showing that these facts of the two cases are slightly different, three children were registered there as they raise essentially the same issue and for trainees or workers seeking employment, this reason the Court decided that they i. e. unemployed. should both be heard on the same day. The cases are regarded as being of considerable importance by the German Government and the answers the Court gives to the questions submitted will affect a number of similar cases. Some of these are already pending before the Court. 4. Mr Bronzino's claim was rejected on 11 April 1985. On 21 August 1986, the Sozialgericht (Social Court), Augsburg, upheld Mr Bronzino's application and ordered the defendant to pay him the family 2. The question raised by both cases is in allowances he was claiming. The defendant essence whether a migrant worker is entitled appealed to the Bayerisches Landessozial- to receive family benefits from the host gericht, which stayed the proceedings and State in respect of an unemployed child asked this Court for a preliminary ruling on resident in the worker's country of origin, the following question: when the first State makes entitlement to benefit conditional on prior registration with that State's employment services and the child in question is in fact registered with the employment services of the second State.

registered as unemployed and available for The national legislation work in the State of residence and under that State's rules and cannot begin or continue vocational training there because of a lack of places in training schemes, but 6. The German authorities' refusal to award the national law of the State of employment Mr Bronzino and Mr Gatto the benefits demands that these preconditions be claimed was based essentially on fulfilled in its territory?' Paragraph 2(4) of the Bundeskinder- geldgesetz (Federal Law on Family Allowances for Dependent Children) 5. In Case C-12/89, the facts are similar. (BKGG), the relevant part of which Mr Gatto is an Italian national who is provides as follows: resident in the Federal Republic of Germany. Unlike Mr Bronzino, however, he is unemployed and since 1976 has been in receipt of unemployment benefits or 'Children who are aged over 16 but under assistance. His wife and three children live 21 shall also be taken into consideration in Italy. His daughter Antonia, who was where, within the territory covered by the born in 1968, is unemployed and his two law, younger children are still at school. On 6 May 1985, Mr Gatto applied to the defendant for German family allowances in respect of Antonia. In support of his claim (1) they cannot begin or pursue vocational he produced a certificate from the training in the absence of vacancies, or responsible Italian employment office to the effect that Antonia was unemployed. Mr Gatto's application was rejected and an action brought by Mr Gatto against the defendant's decision before the Sozial- (2) they are at the disposal of the gericht was unsuccessful. An appeal by employment office as unemployed Mr Gatto to the competent Landessozial- persons . . . ' gericht (Higher Social Court) was also dismissed. Mr Gatto brought a further appeal before the Bundessozialgericht, which decided to refer the following Thus, benefit is only payable in respect of question to this Court: unemployed children between the ages of 16 and 21 if they are resident in the national territory to which the BKGG applies and have either been unable to secure a place on 'Does Article 74(1) of Regulation (EEC) a course of vocational training or are at the No 1408/71, in addition to laying down a disposal of the Federal Employment Office. rule of notional residence, also have as a The issue which this Court is called upon to result that the requirement under the law of decide is whether registration with the the country in which the worker was (last) employment authorities of another Member employed that, for the purpose of family State must be treated as equivalent to regis- benefits, a member of the family be unem- tration with the employment authorities of ployed is to be regarded as fulfilled if the the Federal Republic in the case of the member of the family is at the disposal of children of a person who falls within the the employment office in the country in scope ratione personae of Regulation No which he resides?' 1408/71.

Anicie 73(1): 'An employed person subject to the legislation of a Member State other 9. Finally, Article 3(1) of the regulation than France shall be entitled to the family provides: benefits provided 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 'Subject to the special provisions of this in the territory of the first State.' regulation, persons resident in the territory of one of the Member States to whom this regulation applies shall be subject to the same obligations and enjoy the same benefits under the legislation of any Article 74(1): 'An unemployed person who Member State as the nationals of that State.' was formerly employed and who draws unemployment benefits under the legislation of a Member State other than France shall be entitled to the family benefits provided for by the legislation of the first Member The questions referred State for members of his family residing in the territory of another Member State as though they were residing in the territory of the first State.' 10. The questions referred raise essentially three issues. The first two are whether the benefit claimed by Mr Bronzino and Mr Gatto constitutes a family benefit within the meaning of Anieles 73 and 74 It should be noted in passing that in the respectively of the regulation and, if so, judgment of 2 March 1989 in Case 359/87 whether the conditions of entitlement laid Pinna v Caisse d'allocations familiales de la down in those anieles are satisfied. The Savoie [1989] ECR 585, the Court said that answer to these questions may be affected the phrase 'other than France' in by the third issue raised, which is whether Article 73(1) was to be treated as having the refusal of the German authorities to implicitly been declared invalid by its award benefits to Mr Bronzino and

Mr Gatto is contrary to the rule against of movement between Member States. A discrimination on the grounds of nationality requirement that a person seeking work laid down in Article 3(1) of Regulation must register with a German employment No 1408/71, which is a specific expression agency before entitlement to family benefits of the more general rule laid down in arises in respect of that person amounts to Articles 7 and 48(2) of the Treaty. precisely the type of obstacle which Articles 73 and 74 were designed to remove. Such an obstacle will only disappear, according to the Commission, if registration in another Member State is treated as equivalent to registration in the 11. The German Government, supported in State where benefit is being claimed. Case C-228/88 by the Dutch Government, claims that these questions should in effect be answered in the negative. It argues that the benefit claimed by the applicants is in substance a measure for the promotion of employment which is applicable, irrespective 13. In my view, the benefits claimed by of any question of free movement between Mr Bronzino and Mr Gatto clearly Member States, to everyone in the relevant constitute 'family benefits' for the purposes age-group. Although the measure is of Articles 73 and 74 of the regulation. It classified under the relevant German legis- will be observed at the outset that they are lation as a family benefit, this is due solely, categorized in similar terms not only by the so it claims, to administrative convenience. German legislature but also by the referring The reason why Paragraph 2(4) of the courts. Moreover, in the declaration made BKGG requires the presence in the Federal by the German Government under Article 5 Republic of children in respect of whom of the regulation, which requires Member benefit is claimed is that it is only then that States to specify inter alia the legislation and the German authorities are in a position to schemes referred to in Article 4(1), express find them jobs or places on training mention is made of the law under which schemes. Thus, the link between the award those benefits are claimed (see Official of benefit and presence on the national Journal 1980, C 139, p. 6, item 5). territory is justified by the legislature's objective of promoting employment.

the nature of the benefit and the way in the situation of the claimant could not rely which it is paid confirm that it is intended on Regulation No 1408/71. This was to meet the expenses incurred by parents in because the members of a migrant worker's respect of their unemployed children. The family were only entitled under that regu- benefit thus falls squarely within the defi- lation to the benefits provided under nition of 'family benefits' in Article l(u)(i). national law by virtue of their status as members of the family, while the special unemployment benefit at issue was available to young people seeking work not because they were members of a worker's family but on the basis of their own personal situation. In the present cases, however, the rights at 15. The German Government relies on a issue are those of Mr Bronzino and number of decisions of the Court as Mr Gatto, not those of their children, so showing that the Court categorizes benefits that these considerations do not arise. according to their objectives rather than their formal classification. It cites in this regard Case 94/84 Office national de l'emploi v Deák [1985] ECR 1873, Case 378/85 Campana v Bundesanstalt fìir Arbeit [1987] ECR 2387 and Case 313/86 17. The Campana case provides another Lenoir v Caisse d'allocations familiales des example of the Court's readiness to examine Alpes-Maritimes [1988] ECR 5391 (judg- the substance of a benefit in deciding how it ment of 27 September 1988). Whilst I should be classified for the purposes of accept that the Court is not bound by the Regulation No 1408/71. In that case, the formal classification accorded to a benefit Court was asked whether a national benefit under national law, I do not think that designed to prevent future unemployment those cases lend any further support to the rather than to alleviate the effects of present argument of the German Government. unemployment constituted an unem- ployment benefit within the meaning of Articles 67(1) and 4(l)(g) of the regulation. The Court said that it would be contrary to the aim of Article 51 of the Treaty to exclude from the scope of those provisions all benefits intended to prevent future 16. The Deak case concerned a claim for a unemployment. However, where, as in the special unemployment benefit for young case before the referring court, the benefit workers provided under Belgian legislation took the form of assistance with vocational brought by a Hungarian national living in training, it would only constitute an unem- Belgium with his mother, an Italian national ployment benefit for the purposes of the who had a job there. The applicant's claim regulation in cases involving those who were was rejected by the competent Belgian already unemployed or actually threatened institution because of his Hungarian with unemployment. nationality. The claimant contended that he was entitled to the benefit sought under Regulation No 1408/71 as a member of the family of a worker who was a national of another Member State. The Court held, however, applying the principle laid down in 18. I do not consider that the Campana case Case 40/76 Kermascbek v Bundesanstalt fìir offers any assistance in determining whether Arbeit [1976] ECR 1669, that a person in the benefits at issue in the present cases

constitute family benefits for the purposes of young person is unemployed, he is likely to Articles 73 and 74 of the regulation beyond be a financial burden on his family indicating that the answer to that question regardless of the Member State in which he depends on their substance rather than their resides. Although it may well be easier for form, a proposition which I do not in any young people to find work in the Federal event dispute. Republic than in southern Italy, it would be inconsistent with the proper functioning of the common market for this to be used as a reason for denying benefit to the claimants in cases such as these, for it is one of the objectives of the Treaty to enable workers such as Mr Bronzino and Mr Gatto to take advantage of more favourable conditions 19. I turn now to the Lenoir case, which I prevailing in Member States other than their have two reasons for believing is distin- own. guishable from the present cases, one technical, the other substantive. First, the Lenoir case turned on the special definition of benefits in Anicie 77(1) of the regu- lation, which the Court said corresponded to the definition of 'family allowances' laid down in Article l(u)(ii) of the regulation. It is, of course, Article l(u)(i) which is at issue here. Perhaps more fundamentally, however, the Court in Lenoir drew a 21. Indeed, the principle of freedom of distinction between cash benefits granted movement for workers, to which Regulation exclusively by reference to the number or No 1408/71 is designed to give effect, is age of members of the family and other one of the foundations of the Community. benefits, such as a benefit designed to cover For this reason, the provisions of the regu- expenses associated with the start of the lation should not be construed strictly but school year. While payment of the former rather given a broad interpretation which is remained justified wherever the recipient consonant with its underlying aims. To deny and his family lived, the latter was closely claimants such as Mr Bronzino and linked to the social setting and therefore to Mr Gatto benefit in circumstances such as the place of residence of those affected. It these could act as a considerable disin- was therefore compatible with Article 77 centive to the exercise of the right to for the competent State to refuse to pay the freedom of movement and it seems to me to latter type of benefit to a claimant who had be against just this sort of disincentive that moved with his family to another Member Articles 73 and 74 of the regulation were State. intended to guard. The concept of 'notional residence' enshrined in those articles does not in my view therefore simply require Member States to treat members of the migrant worker's family as if they were resident in the host State. It should also be understood as requiring Member States to regard other conditions of eligibility for 20. In my view, the present cases do not benefits as satisfied if they are satisfied in concern a benefit designed to meet a need the country where the members of the felt only by those whose families are migrant worker's family reside. Otherwise, a resident in the Federal Republic. When a Member State could circumvent the rule of

notional residence by laying down 23. According to the German Government, conditions of entitlement which can in indirect or disguised discrimination on practice only be satisfied by those who are grounds of nationality arises exclusively resident in its own territory. This would be where the rule in question in principle only tantamount to introducing a residence affects foreigners. The notion of indirect requirement by the back door, something it discrimination is by no means as narrow as cannot have been the purpose of Articles 73 this, however, and one need look no further and 74 to permit. than the first Pinna judgment to see that the view of the German Government cannot be reconciled with the Court's case-law.

Member of Germans entitled to family taken place in the competent State. It cites benefits. Case 20/75 D'Amico [1975] ECR 891 and

'Article 74(1) of Regulation (EEC) N o 1408/71 of the Council of 14 June 1971 must be interpreted as meaning that an unemployed person is entitled to family benefits in the State in which he was last employed in respect of family members registered as unemployed and available for work in another Member State, even though the national law of the first State demands that those preconditions be fulfilled in its own territory.'

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