C-337/97

OPINION OF MR LA PERGOLA — CASE C-337/97

OPINION OF ADVOCATE GENERAL LA PERGOLA delivered on 28 January 1999 *

I — Introduction II — The facts of the case and the questions referred by the national court

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that country, which refers to the place of nity legislation does not protect frontier work of the person concerned. workers who do not reside in the Nether- lands. Since according to the Court a study grant awarded by a Member State to the children of workers is a social advantage within the meaning of Article 7(2) of Regulation (EEC) No 1612/68, the College 4. On 14 October 1993 Chantal Meeusen for its part wonders whether that provision applied to the IBG for a grant to study applies also where both the worker and his chemistry at the Provinciaal Hoger Tech- family reside in a State other than the State nisch Instituut voor Scheikunde, Antwerp. of employment and to which the persons From November 1993 to March 1994 she concerned pay their taxes and contribu- received a basic grant, which, under the tions. However, it starts by disclosing its Netherlands study finance law, the Wet op doubts as to whether the mother is an de Studiefinanciering (hereinafter the employee. If the provisions relating to the 'WSF'), is given direct to students who are protection of employees do not apply, the over 18 years of age irrespective of their College asks the Court to rule on the income. By decision of 2 October 1994 the applicability of the provisions on freedom IBG reversed its decision and at the same of establishment. time required Chantal Meeusen to repay the money she had already received. The grant was withdrawn on the grounds that, since Chantal did not have Netherlands nationality and was not resident in the Netherlands, she was not covered by the 5. The College therefore referred the fol- WSF. That law applied to Netherlands lowing questions for a preliminary ruling: nationals and to some categories of foreign- ers, including nationals of Member States of the Community, provided they resided in that country.

1 Β In the Bernini judgment (C-3/90, above in Question 1B, also applies to [1992 ] ECR 1-1071) the Court the child of a national of a Member held that study finance awarded by State who pursued activities in another a Member State to children of Member State as a self-employed per­ workers constitutes a social advan­ son? tage to a migrant worker, as pro­ vided for in Article 7(2) of Regula­ tion (EEC) No 1612/68, where the worker continues to support the child. In such a case the child may rely on Article 7(2) in order to obtain study finance under the To what extent is it also decisive in that same conditions as are applicable connection that the child has never been to children of national workers, resident in the Netherlands, and that the and in particular without any fur­ parent is not resident in the country in ther requirement as to place of which the activity as a self-employed per­ residence. Does this rule equally son is pursued?' apply if the migrant worker must be regarded as a frontier worker?

HI — Relevant Community provisions

1 C Does the rule of law in Bernini, as 6. So far as employees are concerned, the stated in Question IB above, also principle of non-discrimination is set out in apply if the child of a migrant general terms in Article 48(2) of the Treaty, worker, as in the present case, has according to which freedom of movement never lived in the Netherlands? for workers 'entail[s] the abolition of any discrimination based on nationality between workers of the Member States as regards employment, remuneration and other conditions of work and employment'.

c. students who do not possess Nether- lands nationality but are resident in the 8. In the Netherlands, the provisions relat- Netherlands and belong to a category ing to study finance are contained in the of persons specified by or under a WSF, which has been in force since 1 Octo- regulation issued by the public autho- ber 1986. First, provision is made for a rities who are treated as Netherlands basic grant, awarded irrespective of paren- nationals as regards study finance'. tal income (Article 16). A supplementary grant may also be awarded, which is dependent on parental income (Articles 18 and 20). The amount of the basic grant and the supplementary grant vary depending on whether or not the student is living with his or her parents. Under the present regime V — Question 1A grants are paid direct to students. Under the previous system the parents of a student aged 18 to 27 could receive family allow- ances. More needy students could also obtain a study grant calculated on the basis 10. The national court seeks initially to of the family income. ascertain whether Chantal Meeusen's

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firm. The question is therefore one which is to be resolved on the basis of the facts, and the various formal categorisations laid down for particular purposes under Neth- erlands law are irrelevant. The College states that it has found that the work 11. We are thus faced in this case with the difficult problem of distinguishing between performed by Mrs Meeusen is effective the personal and professional aspects of an work. The national court must also ascer- occupational activity pursued in a family tain whether that work is performed under

As is stated in the order for reference, 'in Netherlands law 1 — See judgments in Case 66/85 Lawrie-Blum [1986] ECR the question whether there is a relationship 2121, paragraph 16; Case 197/86 Brown [1988] ECR 3205, of employment has received various replies paragraph 21 and Case C-3/87 Agegate [1989] ECR 4459, paragraph 35. according to the sector of national law 2—Judgment in Case 66/85, cited above, paragraph 17 and concerned (social security law, fiscal law, Case C-107/94 Asscher [1996] ECR I-3089, paragraph 25. civil law)'. 3 — See judgment in Case 53/81 Levin [1982] ECR 1035,

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The must be granted even where the child who Court has also made it clear that the would receive it has never resided in the compatibility with the Treaty of national State which is required to pay the social provisions which make the enjoyment of benefit sought. The two questions therefore social advantages subject to residence relate to the relevance of the place of requirements must be determined by apply residence in determining the applicability ing appropriate tests of reasonableness. The of the rules guaranteeing Community situation of frontier workers is specifically workers equality in the enjoyment of social considered in the Meints case, again as advantages. regards enjoyment of social advantages (in that case what was concerned was an allowance granted on a one-off basis to agricultural workers when their contracts of employment were terminated in parti cular circumstances). In that case the Court held that 'unless it is objectively justified and proportionate to its aim, a provision of national law must be regarded as indirectly discriminatory if it is intrinsically liable to affect migrant workers more than national workers and if there is a consequent risk that it will place the former at a particular disadvantage'. 8 Recently too, in Commis

tions. In the view of the Court the provi 7 —See judgment in Case C-237/94 O'Flynn [1996] ECR sions of Article 48 of the Treaty and of I-2617, paragraph 17. It was on that basis that it was held Article 7 of Regulation No 1612/68 prohi that indirect discrimination resulted from making any reimbursement of expenses paid by a migrant worker bit not only overt discrimination on subject to the condition that burial or cremation take place grounds of nationality but also all disguised in the country, paragraph 23. In the judgment in Case C-27/91 Le Manoir [1991] ECR I-5531, paragraph 10, it forms of discrimination which, through the was held to be incompatible with the Treaty to make entitlement to reductions in an employer's social contribu tions dependent on the employer talcing on trainee workers who came within the State education system, on the basis of the ground that the vast majority of tne trainees still came 6 — See judgments in Joined Cases 389/87 and 390/87 Echter- under the national education system of their respective nacb and Moritz [1989] ECR 723, paragraph 34 and C-3/90 States of origin. Bernini [1992] ECR I-1071, paragraph 24. 8 —Judgment in Case C-57/96 [1997] I-6689, paragraph 45.

incompatible with the Treaty. 9In some of discriminatory treatment in the field of cases there may be objective reasons for social advantages, ultimately supports, it is taking residence into account. In Sotgiu the claimed, the opinion put forward by the Court held that in order to assess the two governments in question. In particular, separation allowance it was necessary to in the view of the Netherlands Govern- see whether at the time when the workers ment, the facts in this case differ from those concerned took up their employment they in Echternach and Moritz in that the were residing in the territory of the State in advantage provided by the award of a question or abroad. 10 study grant to be paid abroad 'has nothing to do with a worker exercising his right to be joined by his family and the conditions for the integration of that family into the

It is concerned in this case. In this connection necessary, however, to examine more close- the Netherlands Government cites the fifth ly the arguments put forward by each of recital in the preamble to the regulation, those governments. The German Govern- which sets out the objective of eliminating ment observes that, as compared with the obstacles to the freedom of movement for workers: one of the ways of achieving this protagonists in the present case, the persons is to grant the worker the right 'to be joined who were claiming Community social by his family and the conditions for the advantages in the Bernini case had closer integration of that family into the host links with the Netherlands State.

The Nether- seek a wide application of the prohibition lands Government adopts the same posi- tion; in its view the decisive factor is that Mrs Meeusen chose to maintain her resi- 9—Judgment in Case C-111/91 [1993] ECR I-817, paragraph dence in Belgium. The present case, it 7. claims, is one in which the worker con- 10 —Judgment in Case 152/73 [1974] ECR 153, paragraph 11. cerned has no intention of becoming inte- 11 —Judgments in Case C-308/89 Di Leo [1990] ECR I-4185, paragraph 9 and in Case 235/87 Matteucci [1988] ECR grated into the State of employment. 5589, paragraph 16.

17. What can be said of these arguments? criterion of coordination. Regulation (EEC) In the case before us, it is true, the No 1408/71 of the Council of 14 June requirements of integration do not seem 1971 on the application of social security to be relevant. The Meeusens move easily schemes to employed persons and their between the State in which they work and families moving within the Community the State where they live together with their (OJ, English Special Edition 1971 (II), daughter. Their situation, one might say, p. 416) lays down, in implementation of provides a striking example of the mobility Article 51 of the EC Treaty, the provisions of workers in practice. It is of no conse­ needed in order to coordinate the detailed quence, from this point of view, that, as has rules for the payment of social security already been stated during the proceedings, benefits in the categories referred to in that the plaintiff resided in the Netherlands instrument of secondary legislation. The until the age of five or, as Mr Meeusen same criterion was adopted by the Com­ stated at the hearing, that since the summer munity legislature also in respect of the of 1997 Chantal Meeusen has been residing category of social advantages provided for in the Netherlands (without however chang­ in Article 7(2) of Regulation No 1612/68, ing her plans to study in Belgium). a category which is more general than that covering the benefits specifically deter­ mined by Regulation No 1408/71. 12 In my view there is justification for applying the principle of non-discrimination, as laid down in general terms in Article 48 of the Treaty and in Article 7(2) of Regulation No 1612/68, in a case such as the one 18. The fact is, however, that the problem before us. The social security benefit in before the Court must be posed and question has, as I have observed earlier, resolved in the context of a mobile frontier unquestionably the character of a compen­ worker and not that of a worker who must satory advantage, although there is a resi­ be encouraged to put down roots in the dence condition except for Netherlands country in which he works. The relevant nationals. In this way, as the Commission requirement, as the Commission rightly observes, inequality of treatment between pointed out, is therefore that of coordina­ frontier workers is introduced, depending tion between the various systems of social on their nationality. Eliminating such dis­ advantages provided for by the Member crimination means ensuring that a worker States: all the more so, I should say, when, who is exercising his freedom of movement as in this case, those advantages are at least is not deprived of the advantages accorded in part compensatory to the extent that to a worker who stays put. This in my view they are funded by contributions paid by the workers themselves. is a solution which complies with both the

19. In the Bernini case, the Court acknowl- edged that certain study grants came within The factors which are in any event of the category, broadly defined in its case- importance are two in number: the com- law, of social advantages within the mean- pensatory nature of the advantages in ing and for the purposes of Regulation question and the fact that the prohibition N o 1612/68. 13 The question had been put on discrimination derives its justification in with specific reference to the provisions of this context from requirements relating the WSF which provide for benefits granted rather to coordination of systems than to directly to the s:udents and thus not

ances. Study grants and family allowances should be made between the two systems, as suggested by the Commission, taking into account all the different types of finance provided for. It is necessary to take 13 — The term 'social advantages' as defined by the settled case- law of the Court incluces 'all those which, whether or not into account both the family allowances linked to a contract of employment, are generally granted granted to workers and the grants paid to national workers primarily because of their objective status as workers or by virtue of the mere fact or their directly to students.

It is not relevant therefore to state, as the Netherlands Government the written observations submitted by the does, that in the Netherlands entitlement to study finance is regarded as a legal situation which concerns only the Netherlands Government which, in exam- student and has therefore nothing to do with the parents. ining the Belgian legislation applicable in The compensatory natu :e of the benefit is recognised in the Bernini judgment in tht statement that study finance may theory, fails to take into account the fact be regarded as a social advantage only if the worker continues to support th: child. Referring to this criterion, the Netherlands Government points out that in the case now before it it is necessary to establish whether the plaintiff is indeed being supported by her mother, on 15 — The Member States have, moreover, different systems for whose status as an employee the applicability of the awarding grants. A survey of the situation in the various regulation depends, and not the father, who is not an Member States can be found in Rossi, F.R: / diritti della employee ana whose s tuation would not be taken into famiglia europea nell'ordinamento comunitario di sicur- account under the domestic provisions concerned. ezza sociale, Milan, 1996, p. 90 et seq.

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VIII — Conclusion

22. In the light of the foregoing I propose that the Court should reply to the national court as follows:

1A In determining whether a worker who is employed by a limited liability company of which her husband is the director-general and sole shareholder may be regarded as a migrant worker within the meaning of Article 48 of the EC Treaty, general criteria should be applied in order to establish whether the work performed is subordinate or autonomous, and how the occupation concerned fits into the organisation of the firm.

IB and 1C Children of workers who do not reside in their State of employment, evert where such children do not live in their parent's State of employment, may have recourse to the study grants awarded by a Member State which, having regard inter alia to their compensatory nature, constitute social advantages within the meaning of Arti- cle 7(2) of Regulation (EEC) No 1612/68.