C-347/00

BARREIRA PÉREZ

OPINION OF ADVOCATE GENERAL LÉGER delivered on 6 June 2002 1

1. With the aim of helping to establish This involves determining the extent to freedom of movement for workers, Council which a period of notional contribution Regulation No 1408/71 2 provides that, which, according to the national legis- where a national of a Member State cannot lation, has been added to periods of actual establish a period of affiliation or of contribution solely in order to fix the employment sufficient to entitle him to a amount of retirement pension, must be retirement pension in that State, periods of taken into account in calculating this pro insurance or of employment completed by rata benefit. the person concerned in various Member States shall be aggregated.

2. In those circumstances, the retirement pension payable by the Member State is to I — Legal background be calculated in accordance with the ratio of periods of insurance or employment completed by the person concerned in that State. This is referred to as a 'pro rata benefit'.

The provisions of national law

•—• 3% for each additional year in which contributions are paid, between the '(a) These contributions shall be calculated 16th and 25th year inclusive, and on the basis of contributions actually paid during the period falling between 1 January 1960 and 31 December 1966 to one or both of the abovemen- tioned schemes, but contributions which overlap shall be taken into account only once; — 2% for each additional year in which contributions are paid, commencing with the 26th year, provided that the total applied to the reference basis of assessment does not exceed 100%. 4

(b) where appropriate, the number of years and fractions of years attributed to the worker by reference to his age on 1 January 1967 shall be added to the 6. Each worker's years of contribution are number of days of contributions to be determined on the basis of periods of referred to in subparagraph (a) above, contribution to the general social security in accordance with the scale set out scheme from 1 January 1967, increased, below... where necessary, by periods of contribution to previous old-age and disability insurance 5 — Article 9(4) of the Orden Ministerial (Ministerial Order) of 18 January 1967 on the provisions for application and implementation of old-age benefit (BOE No 22 of 26 Janu- 4 — Ibid., paragraph 163. ary 1967), or 'the Ministerial Order'.

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9. They are not taken into account for the purpose of building up the 15-year mini- mum qualifying period for entitlement to '(a) the competent institution shall calcu- an old-age pension. late the theoretical amount of the benefit to which the person concerned could lay claim provided all periods of insurance and/or of residence, which have been completed under the legis- lation of the Member States to which The provisions of Community law the employed person or self-employed person was subject, have been com- pleted in the State in question under the legislation which it administers on the 10. According to Article l(r) of the Regu- date of the award of the benefit. If, lation, the term 'periods of insurance' under this legislation, the amount of

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the benefit is independent of the dur- 14. He made contributions in respect of ation of the periods completed, the 4 051 days in Germany, sufficient to entitle amount shall be regarded as being the him to a retirement pension from the theoretical amount referred to in this competent German institution. He also paragraph; contributed for 5 344 days in Spain, which is less than the minimum qualifying period of 15 years, fixed by the legislation of that State. 7

6 — According to Article 4(1) of the Regulation, 'the risk' refers to the event covered by the social security benefit concerned. Here, therefore, it means the old age of the person 7 — See paragraph 3 of this Opinion. concerned. 8 — 4 051 days in Germany and 5 344 days in Spain.

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which form the denominator of the coef- as meaning that periods of notional, ficient by which the theoretical amount equivalent contribution, which may be must be multiplied in order to determine taken into account under the legislation the pro rata benefit. of a Member State for the purpose of determining the number of years of contribution by reference to which the amount of old-age pension is deter- mined under domestic legislation, are also to be considered from a legal viewpoint as "periods of insurance"? 17. Consequently, the coefficient applied by the I.N.S.S. to the theoretical amount was 0.5685, instead of 0.6733.

(2) If the answer to the first question is in the affirmative, is the proper construc- tion of Article 46(2)(b) [of that regu- 18. Mr Barreira Pérez brought an action lation] that "the duration of the against the I.N.S.S.'s decision to fix his periods of insurance or of residence retirement pension in Spain on that basis. completed before the materialisation of the risk under the legislation which [the competent institution of a Member State] administers" also includes those periods of notional contribution cor- responding to periods before the materialisation of the risk which, under the legislation of the Member State concerned, are to be taken into account III — The questions referred for a prelimi- as periods of contribution for the nary ruling purpose of determining the amount of old-age pension?'

25. As the Commission has rightly asserted, it is for the national court to On the first question interpret its own legislation, in compliance with the provisions of the EC Treaty relat- ing to freedom of movement for persons.

22. As regards the defining of the concept of 'periods of insurance' in Article l(r) and (s) of the Regulation, it is apparent from the wording of these provisions that they 26. Within the framework of cooperation refer expressly to national legislation. established by Article 234 EC, the Com- munity judicature may nevertheless provide the national court with useful guidance on

9 —Case 388/87 Warmerdam-Steggerda [1989] ECR 1203, paragraph 10, and Case C-349/87 Paraschi [1991] ECR I-4501, paragraph 15. 10 — Case 126/77 Frangiatnore v Office National de l'Emploi [1978) ECR 725; Joined Cases C-45/92 and C-46/92 23. As the Court has often held, the object Lepore and Scamuffa v Office national des pensions of the Regulation, in pursuance of [1993] ECR I-6497, paragraphs 19 and 20; and Case C-28/00 Kaner v Pensionsversicherimgsanstalt der Anges- Article 42 EC, is the aggregation, for the tellten [2002] ECR I-1343, paragraph 26.

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28. It will fall to the national court to ascertain whether each of these conditions is satisfied. 32. Next, it is undisputed that the I.N.S.S. took this period into account in full in calculating the theoretical amount of the pension, as laid down in Article 46(2)(a) of the Regulation. 13 The merits of taking it into account in this way are not disputed by the Spanish Government. 29. In the light of the facts that the national court has made known to the Court, we may reasonably consider that the period at issue satisfies those conditions, with the result that it falls within the ambit of the Regulation. 33. It ought to be borne in mind that, under Article 46(2)(a) of the Regulation, the 11 — Case C-111/91 Commission v Luxembourg [1993] ECR I-817, paragraph 29 and the case-law cited. Article 4(1)of the Regulation provides that the latter is to apply to all legislation concerning the branches of social 12 — See paragraphs 4 to 8 of this Opinion and the order for security covering the benefits which it lists, among which reference, pp. 2 to 3. are old-age benefits. 13 — See the order for reference, p. 4.

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35. In that regard, it seems to me important to point out that neither the Spanish Government nor the I.N.S.S., at the hear- ing, was able to explain, in answer to the Court's questions on this point, on what basis this period had been taken into 38. Similarly, this line of argument seems account in this calculation without being to me to be contradicted by the fact that the period at issue was attributed to Mr Bar- reira Pérez because he had contributed to 14 — Lepore and Scamuffa, paragraphs 17 to 19. one of the insurance schemes which was 15 — See paragraph 10 of this Opinion. abolished when the national system was set

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up. The origin of that period is, therefore, On the second question membership of and contributions paid to a social security scheme. Furthermore, it is apparent from the Spanish Government's own explanations that attributing to 41. This concerns determination of the workers who have been members of one of these schemes a fixed period, determined extent to which the period of insurance at according to their age, was a measure issue may be regarded as having been intended to preserve their rights acquired completed before the materialisation of under those schemes in the light of the new the risk, within the meaning of conditions on length of contribution and Article 46(2)(b) of the Regulation. benefit rates laid down by the new sys- tem. 16

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from the wording of Article 46(2)(a) that Security of Migrant Workers of 24 January the competent institution is to apply its 1974 21 and from Menzies 22 that the own State's legislation in its entirety. The notional periods taken into consideration Court deduced from this that, if this legis- solely in order to compute the theoretical lation provides that the old-age benefit amount but not to determine the pro rata must be calculated not only by reference benefit are notional periods after the to actual periods or periods treated as such, materialisation of the risk. but also to a number of additional years of notional work, these additional years must also be taken into account in calculating the theoretical amount of benefit. 18

48. It thus follows from the Court's judg- ment in Di Prinzio that the notional periods which, under the national legis- lation applicable, must be added to actual 45. Secondly, the Court took the view that, periods of contribution in order to fix the where the notional periods recognised by theoretical amount of old-age pension and the applicable national legislation predate which predate the materialisation of the the materialisation of the risk, as in the risk, must be taken into account in calculat- present case, those periods must be ing this pro rata benefit. included in the calculation of the pro rata benefit. 19

49. In the present case, it is undisputed that, under the national legislation, the 46. The Court based that statement on the period at issue was taken into account in words 'periods of insurance completed calculating the theoretical amount of the before the materialisation of the risk' in benefit. 23 Article 46(2)(b) of the Regulation.20

51. It is apparent from the Second Transi- tional Provision of the Ministerial Order 24 and from the order for reference 25 that the period at issue was attributed to Mr Bar- reira Pérez because he had contributed to 54. That supplementary period therefore previous Spanish insurance schemes. It is came after the risk had materialised, that is common ground that the period was cal- to say, after the accident at work suffered culated with reference to his age on 1 Ja- by the person who then claimed invalidity nuary 1967, according to the scale laid pension, and because of which he was down for that purpose. That period there- entitled to that pension. fore forms part of the rights to which Mr Barreira Pérez is entitled on account of having contributed to these schemes. It was indeed completed before the risk covered by the benefit materialised, in the calcu- lation of which the period was taken into account, that is to say, the old age of the 55. The Court logically deduced from that, person concerned. therefore, that this supplementary period, which did not correspond to any period of insurance or of actual residence in the Member State in question completed before the risk materialised, had to be taken into account in calculating the theoretical 52. In this regard, contrary to what the amount but not in calculating the pro rata Spanish Government and the I.N.S.S. main- benefit. 27 tain, the period at issue differs from the one at issue in Menzies.

53. That case involved a supplementary 56. In the present proceedings, the facts period which was intended to help evaluate giving rise to the period at issue, namely, the benefits granted in the case of pre- first, contribution to one of the previous mature invalidity or death of an insured insurance schemes and, second, the age of

61. Contrary to what the Spanish Govern- 28 — Regulation (EEC) No 574/72 of the Council of 21 March 1972 laying down the procedure for implementing Regu- ment and the I.N.S.S. maintain, this con- lation (EEC) No 1408/71, as amended and updated by clusion does not have the effect of confer- Council Regulation (EC) No 118/97, as amended by Council Regulation (EC) No 1399/1999. ring a dual advantage on the applicant.

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62. Taking it into account in this way paragraph 3(b) of the Second Transitional simply constitutes strict application of Provision. 29 Article 46(2)(b) of the Regulation, which is precisely intended to fix the actual amount of the benefit payable by the respective institutions of each Member State in accordance with the proportion of rights that the worker has acquired in each of those States. 66. Discounting the contested notional period from the calculation of the pro rata benefit clearly has the effect of reducing, simply because he has exercised his right to freedom of movement, the advantages that Mr Barreira Pérez would have derived from this notional period.

63. Conversely, the approach advocated by the Spanish Government and the I.N.S.S. penalises Mr Barreira Pérez for exercising his right to freedom of movement.

67. The Regulation has the objective of ensuring that migrant workers do not lose their rights to social security benefits or have the amount of those benefits reduced because they have exercised the right to freedom of movement conferred on them 64. If Mr Barreira Pérez had remained by the Treaty. 30 working in Spain and had completed all his periods of insurance there, his old-age pension would have been calculated taking into account the whole of the notional period at issue.

69. The Court has deduced from this that 72. As a subsidiary plea, the Spanish Gov- the abovementioned articles constitute a ernment has asked the Court to rule, if it barrier to a Community worker's forfeit- has replied in the affirmative to the ques- ing, because he has exercised his right to tions referred for a preliminary ruling, that freedom of movement, all or part of the the judgment will not have any retroactive advantage of a provision of his national effect. social security legislation. Thus, the Court has taken the view that it is incompatible with Community law for a migrant worker to be precluded from relying, for the calculation of his old-age pension, on national legislation treating periods of invalidity as periods of active employment on the sole ground that, when he became 73. The Spanish Government has asserted incapable of work, he was employed, not in that affirmative answers run the risk of the Member State in question, but in causing a serious economic imbalance for another Member State. 32 the national social security scheme. It has added that persons who contributed between 1960 and 1966 in a Member State will be able to obtain a significant increase in the pension to which they are entitled in Spain. 70. The approach upheld by the I.N.S.S., which, so far as the applicant is concerned, results in the coefficient used to calculate the pro rata benefit's being fixed at 0.5685 instead of 0.6733, is actually such as to dissuade a worker from exercising his right to freedom of movement. 74. It ought to be borne in mind that the Court's interpretation of a rule of Commu- nity law, in the exercise of the jurisdiction conferred on it by Article 234 EC, clarifies and defines the meaning and scope of that 71. I deduce from all these factors that the rule as it must be or ought to have been second question referred for a preliminary understood and applied from the time of its ruling must be answered in the affirmative. entry into force. It follows that the rule as thus interpreted may, and must, be applied by the courts even to legal relationships 31 — See, in particular, Paraschi, paragraph 22, and Case which arose and were established before C-302/90 Caisse auxiliaire d'assurance maladie-invalidité and Institut national d'assurance maladie-invalidité v Faux the judgment ruling on the request for [1991] ECR I-487J, paragraphs 27 and 28, and the interpretation, provided that in other case-law cited. 32 — Lepore and Scamuffa, paragraph 24. respects the conditions for bringing a dis-

pute relating to the application of that rule ruling in the affirmative, the judgment to be before the competent courts are satisfied. 33 delivered will have negative financial reper- cussions for the Spanish social security system, even though, as the documents in this case now stand, it is not possible to assess their extent and duration. However, 75. According to settled case-law, it is it seems to me that the two other conditions therefore only exceptionally that the Court set out above are not fulfilled. may, in application of the general principle of legal certainty inherent in the Commu- nity legal order, be moved to restrict for any person concerned the opportunity of relying upon a provision which it has interpreted with a view to calling in ques- tion legal relationships established in good 78. The condition relating to the good faith faith. 34 of those concerned requires that they should have been reasonably mistaken as to the applicability 37 or the scope 38 of the Community provision being interpreted. It is necessary that the ambiguity of Commu- 76. Two essential criteria must be fulfilled nity law should have given rise to a before such a limitation can be imposed, significant legal uncertainty. 39 namely that those concerned should have acted in good faith and that there should be a risk of serious difficulties. 35 Furthermore, the limitation may be allowed only in the actual judgment ruling upon the interpre- tation sought. 36 79. Article 46 of the Regulation does not present any particular ambiguity. In any event, the provisions of Article 46(2)(b) of the Regulation, since their interpretation in 77. In the present case, it appears undeni- the Di Prinzio case, no longer involve any able that, if the Court should answer the ambiguity, at least as regards the conditions two questions referred for a preliminary in which the notional contribution periods must be taken into account in calculating the pro rata benefit. In that connection, the 33 — Case C-262/96 Stiriti v Bundesanstalt für Arbeit [1999] ECR I-2685, paragraph 107. Spanish Government and the I.N.S.S. have 34 — In Case 43/75 Defrentie v Société anonyme belge de not invoked any circumstances other than navigation aérienne Sabena [1976] ECR 455, the Court accepted, for the first time, that it could limit the temporal the probability of financial repercussions effects of its preliminary rulings, on the basis of important for the social security body concerned. considerations of legal certainty affecting all the interests involved, both public and private. See, for a recent application. Case C-372/98 The Queen v Ministry of Agriculture, Fisheries and Food, ex parte J.H. Cooke eV Sons [2000] ECR I-8683, paragraph 42. 37 — Case C-262/88 Barber v Guardian Royal Exchange 35 — See the Court's judgment in Cooke, paragraph 42. Assurance Group [1990] ECR I-1889, paragraph 4 3 . 36 — Case C-I63/90 Administration des Douanes et Droits 38 — Case 61/79 Amministrazione delle finalize dello Stato v Indirects v Legros and Otliers [1992] ECR I-4625, Denkart italiana [1980] ECR 1205, paragraphs 19 to 2 1 . paragraph 30, and Case C-415/93 Bosman | 1 9 9 5 | 39 — Joined Cases C-197/94 and C-252/94 Bauliaa and Société ECR I-4921, paragraph 142. française maritime [1996] ECR I-505, paragraph 48.

82. As I have stated above, limitation of the temporal effects may be allowed only in the actual judgment ruling upon the interpre- 85. I think that the circumstances in this tation sought. The Court has taken the case do not justify any derogation from the view that, when a judgment interpreting a principle that interpreting judgments have provision of Community law has not retrospective effect.

40 — Case C-35/97 Commission v France [1998] ECR 1-5325, paragraph 52, and Case C-104/98 Buchner and Others v 41 — Case 309/85 Barra v Belgian State and City of Liège Sozialversicherungsanstalt der Bauerrn [2000] ECR I-3625, [1988] ECR 355, paragraph 14. paragraph 41 and the case-law cited. 42 — See paragraph 24 of this Opinion.

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VI — Conclusion

86. In light of the preceding considerations, I propose that the Court should give the following answers to the questions referred for a preliminary ruling by the Juzgado de lo Social (Social Court), Orense:

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