C-117/89

OPINION OF MR VAN GERVEN —CASE C-117/89

OPINION OF MR ADVOCATE GENERAL VAN GERVEN delivered on 29 March 1990*

Mr President, in pursuance of the provisions of Articles 73 Members of the Court, and 74 by reason of the pursuit of a professional or trade activity in the country of residence of the members of the family 1. The Bundessozialgericht (Federal Social Court) has asked the Court of Justice for a preliminary ruling on the interpretation of Articles 73(1) and 76 of Regulation (EEC) No 1408/71, 1as amended and updated by- Entitlement to family benefits or family Regulation (EEC) No 2001/83. 2 Those allowances under the provisions of Articles provisions are worded as follows: 73 and 74 shall be suspended if, by reason of the pursuit of a professional or trade activity, family benefits or family allowances are also payable under the legislation of the 'Article 73 Member State in whose territory the members of the family are residing.' Employed persons

Background 1. An employed person subject to the legis- lation of a Member State other than France shall be entitled to the family benefits provided for by the legislation of the first Member State for members of his family 2. Mr Kracht is an employed person residing in the territory of another Member covered by the German Bundeskinder- State, as though they were residing in the geldgesetz (Law on Child Allowances). His territory of the first State.' wife resides in Italy with their two children, Marco and Lukas Oliver. She works for a bank in Milan. 'Article 76

date she received no further benefits in '(1) Is entitlement to benefits under Article respect of either child from the competent 73 of Regulation (EEC) No 1408/71 to Italian institution, o n t h e g r o u n d that she be suspended pursuant to Article 76 of had failed to accomplish the requisite that regulation if family benefits or formalities. When Lukas Oliver resumed his family allowances are no longer studies in September 1986 — and, as I payable in the Member State in which understand the order for reference, thereby the members of the family reside only again satisfied the substantive conditions because they are not applied for? under both German and Italian law — Mrs Kracht did not re-apply for family allowances in respect of him from the competent Italian institution, just as she did (2) Is entitlement to benefits under Article not apply for allowances in respect of Marco. 73 of Regulation (EEC) No 1408/71 to be suspended pursuant to Article 76 of that regulation if family benefits or family allowances are no longer payable in the Member State in which the members of the family reside only 3. Mrs Kracht's attitude must be viewed in because they are no longer claimed as relation to the application for family from an arbitrarily determined date? ' allowances previously submitted by Mr Kracht in respect of their two sons to the Bundesanstalt für Arbeit and rejected by the latter. Mr Kracht brought an action against that rejection before the Sozialgericht For the views of the national court and the (Social Court) Oldenburg, which annulled observations submitted to the Court, I refer the Bundesanstalt's decision and ordered it to the Report for the Hearing. (1) to pay family allowances in respect of both children until the end of 1983, after deduction of the allowances paid by the Italian institution, and (2) to pay the full amount of the family allowance in respect The Court's case-law of Marco as from 1 January 1984 and in respect of Lukas Oliver from 1 January 1984 to 30 June 1985, and again as from September 1986. The Bundesanstalt did not appeal either against the first part of the 4. In its judgments in Salzano 3 and Sozialgericht's decision or against the order Ferraioli,4 the Court considered the to pay family allowances in respect of Lukas situation of a family in which the spouses Oliver from 1 January 1984 to 30 June were employed in different Member States 1985. However, the Bundesanstalt did and the children resided with the mother. In appeal, in the first instance to the Landesso- both of those cases, the mother had not zialgericht (Higher Social Court) Nieder- applied for family allowances from the sachsen and subsequently to the Bundesso- competent institution of her country of zialgericht, against the order to pay family residence. In its judgment in allowances in respect of Marco as from 1 Ferraioli — which in that respect is taken January 1984 and in respect of Lukas Oliver as from September 1986. The Bundessozial- 3 — Judgment in Case 191/83 Salzano v Bundesanstalt für Arbeit [1984] ECR 3741 gericht referred the following questions to 4 — Judgment in Case 153/84 Ferraioli v Deutsche Bundespost the Court for a preliminary ruling: [1986] ECR 1401

5. In its first question the Bundessozial- gericht seeks to ascertain whether the entit- 'There is no suspension under Article 76 of lement to family allowances which is Regulation No 1408/71 of the entitlement provided for under the legislation of the to family allowances payable in pursuance Member State in which one of the parents is of Article 73 of that regulation in the employed, in this case, German legislation, Member State of employment of one of the is suspended where the allowances are no parents when the other parent resides with longer payable under the legislation of the the children in another Member State and Member State in which the members of the pursues there a professional or trade activity family reside, in this case Italian legislation, but does not receive family allowances for on the ground that they are not (or no the children on the ground that not all the longer) applied for. That question is conditions laid down by the legislation of manifestly inspired by the fact that Mrs that Member State for the receipt of such Kracht did not apply for family allowances allowances are satisfied.' from the competent Italian institution in respect of Lukas Oliver as from September 1986, when he resumed his studies, although she was aware that she was entitled to benefits from the Italian institution inasmuch as she had previously applied for and received such benefits. In paragraph 14 of the Ferraioli judgment, as in paragraphs 7 to 10 in the Salzano judgment, the Court made it clear, moreover, that the 'conditions laid d o w n . . . for the actual receipt of such allowances' are not only those of substance but also those of form, including the I can see only one difference between this condition that a prior application has been situation and that which came before the made. 5 According to the Court's case-law, Court in Salzano and Ferraioli, namely the therefore, the allowances are not 'payable' fact that in those cases an application had in the Member State in whose territory the never been made in the Member State in members of the family reside, within the which the members of the family resided, meaning of Article 76 of Regulation No whereas in this case the allowances were 1408/71, where they are not actually initially applied for in that Member State, granted because no prior application has but subsequently ceased to be applied for. been made. That difference is immaterial. In both situ- ations— both where the allowances are not applied for and where they are not 5 — Previously, in its judgment in Case 134/77 Ragazzoni v Assubel [1978] ECR 963, the Court had staled that the re-applied for — not all the conditions for suspension referred to in Article 76 of Regulation No the actual grant of the allowances laid down 1408/71 can only take effect if the spouse fulfils in the Member State in which the members of the family reside by the legislation of the Member State in 'atl the conditions required by the domestic legislation of that State in order to exercise that right' (paragraph 9, which the members of the family reside are emphasis added); however, the Court did not make it clear whether that meant conditions both of substance and of fulfilled, and consequently, according to the form. case-law of the Court, there are no grounds

6. In its second question the Bundessozial- gericht wishes to ascertain whether the entitlement to family allowances provided for under the legislation of the Member State in which one of the parents is employed, namely German legislation, is suspended where the allowances are no The fact that the Italian institution discon- longer payable under the legislation of the tinued payment of the benefits as a result of Member State in which the members of the a conscious choice on Mrs Kracht's part not family reside, namely Italian legislation, on to accomplish the requisite formalities as the ground that as from an arbitrarily from a date chosen by her is, in my view, determined date they are no longer applied equally immaterial. It follows inescapably for. In this question the national court from the Court's interpretation of Article 76 manifestly wishes to draw attention to the of Regulation No 1408/71—to the effect fact that the grant of family benefits in Italy that the allowance is payable in the Member depended purely and simply on Mrs State in which the members of the family Kracht's attitude, namely her failure to reside when the formal conditions, including accomplish the requisite formalities as from the application for the grant of the a date freely determined by her. She accom- allowance, are fulfilled — that the spouses plished those formalities in connection with may choose the institution responsible for the family allowances for Marco in 1983, payment. Furthermore, that choice must be but not in 1984. viewed in the light of the Court's established case-law, according to which the entit- lement to benefit in the Member State in which one of the parents is employed is suspended only up to the amount provided for by the legislation of the Member State in Precisely what those formalities were is which the members of the family reside. 6It unclear. The national court suggests that is therefore open to the spouses either to Mrs Kracht withdrew her initial application submit two applications, the first to the for the grant of family allowances. For its competent institution of the Member State part, the Italian Government points out that in which the members of the family reside in Italy family allowances must be and the second, for payment of the balance, re-applied for every year. Finally, the to the competent institution of the Member Commission states that since 1984 Italian legislation has laid down maximum income 6 — See inter alta the Court's answer to the second question in levels above which entitlement to family Ferraioli

The new wording of Article 76(1) thus 7. At the hearing, reference was made to confirms the interpretation which must be the fact that by Regulation (EEC) No given to that provision in accordance with 3427/89 of 30 October 1989 7the Council the abovementioned cases, namely that the has amended Article 76 of Regulation No entitlement to benefit in the Member State 1408/71, which now reads as follows: in which one of the parents is employed is suspended only up to the amount paid in the Member State in which the members of the family reside and not as regards the 'Rules of priority in cases of overlapping entit- balance in excess of that amount. lement to family benefits under the legislation of the competent State and under the legis- lation of the Member State of residence of the members of the family However, the new Article 76(2) alters the scope of the wording at issue in this case, as interpreted by the Court in the Salzano and 1. Where, during the same period, for the Ferraioli judgments. The failure to submit a same family member and by reason of prior application in the Member State in carrying on an occupation, family benefits which the members of the family reside will are provided for by the legislation of the in the future no longer be sufficient in order Member State in whose territory the to be able to claim the full amount of the members of the family are residing, entit- allowance in the Member State in which lement to the family benefits due in one of the parents is employed. accordance with the legislation of another Member State, if appropriate under Articles 73 and 74, shall be suspended up to the amount provided for in the legislation of the first Member State. At the hearing, the German Government argued that this new provision is already applicable because in fact it merely confirms 2. If an application for benefits is not made the manner in which the previous version of in the Member State in whose territory the Article 76 should have been construed. In my opinion, that view clearly runs counter 7 — Council Regulation (EEC) No 3427/89 of 30 Occober to Article 3 of Regulation No 3427/89, 1989 amending Regulation (EEC) No 1408/71 on the application of social security schemes to employed which provides that Article 76 as amended is iersons, to self-employed persons and to members of their applicable only from 1 May 1990, even f amilies moving within the Community and Regulation (EEC) No 574/72 laying down the procedure for though all the other provisions of that regu- implementing Regulation (EEC) N o 1408/71 (OJ L 331, 16.11.1989, p. 1). lation are stated to be applicable with effect

8 — Judgment in Case 41/84 Pinna v Caisse d'allocations fami- liales de la Savoie [1986] ECR 1.

I - 2793