CELEX: 61991CJ0090
Old-age and survivors' pensions
Calculation of benefits
National and Community rules against overlapping

Grounds
1 By two judgments of 22 February 1991, registered at the Court on 12 March 1991, the Cour du Travail (Higher Labour Court), Liège (Belgium), referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty a number of questions on the interpretation of Articles 12(2) and 46 of Regulation (EEC) No 1408/71 of the Council of 14 June 1971 on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community, codified by Council Regulation (EEC) No 2001/83 of 2 June 1983 (OJ 1983 L 230, p. 6).
2 Those questions were raised in the course of proceedings between the Office National des Pensions (National Pension Office, hereinafter "the ONP") and, first, Mr Emidio Di Crescenzo and, secondly, Mrs Angela Casagrande concerning the ONP' s calculation of the retirement pension payable to Mr Di Crescenzo and the survivor' s pension payable to Mrs Casagrande.
3 It may be seen from the papers forwarded to the Court by the national court that Mr Di Crescenzo, who is of Italian nationality, worked in Belgium as a mineworker for 27 years. He had previously pursued an activity as an employed person or an activity treated as such in Italy for 256 weeks.
4 On 1 April 1975 the Office National des Pensions pour Travailleurs Salariés (the National Pension Office for Employed Persons, hereinafter "the ONPTS"), the competent Belgian institution, acknowledged that Mr Di Crescenzo was entitled to a full Belgian mineworker' s retirement pension. That right was based on the 27 years of actual work which he had completed in Belgium, increased by three notional years granted him pursuant to the Belgian provisions governing mineworkers' pensions.
5 As from 1 July 1980 Mr Di Crescenzo was also entitled to an Italian retirement pension. On the basis of the Belgian provisions against the overlapping of benefits, and taking account of the years in respect of which Mr Di Crescenzo received an Italian pension, the ONPTS, by a corrective decision of which he was notified on 17 May 1985, reduced the number of notional years granted to him and, accordingly, the amount of his pension with effect from 1 July 1980.
6 Mrs Casagrande is the widow of Mr Barel, who died on 16 January 1983. In accordance with Belgian legislation, the ONPTS calculated her survivor' s pension on the basis of the retirement pension to which her husband would have been entitled. Mr Barel, an Italian national, worked in Belgium as a mineworker for 21 years. He had previously pursued an activity as an employed person or an activity treated as such in Italy for 14 years.
7 On 30 September 1983 Mrs Casagrande was provisionally acknowledged to be entitled to a full employed person' s survivor' s pension. That right was based on the 21 years of actual work completed by her husband in Belgium as a mineworker, increased by 14 presumed years of occupation as an employed person, which were granted to him pursuant to the Belgian provisions on employed persons' pensions.
8 On the basis of the Belgian provisions against the overlapping of benefits, and taking account of the years in respect of which Mrs Casagrande was entitled to an Italian survivor' s pension, the ONPTS, by a final decision of 12 October 1984, reduced the number of years of presumed occupation initially granted to Mr Barel and, accordingly, the amount of the pension granted to Mrs Casagrande.
9 Mr Di Crescenzo and Mrs Casagrande challenged the decisions of 17 May 1985 and 12 October 1984 before the Tribunal du Travail (Labour Court), Liège, claiming that Article 12(2) of Regulation No 1408/71 precluded the application to Community nationals of the national provisions against the overlapping of benefits. The Tribunal du Travail upheld their applications and acknowledged their right to a full pension.
10 The ONP, which succeeded to the rights and obligations of the ONPTS, agreed that Mr Di Crescenzo was to be granted a full pension until 31 December 1980, in view of the fact that Belgian legislation included no provision against the overlapping of benefits at that time. However, the ONP appealed before the Cour du Travail, Liège, against the judgment of the Tribunal du Travail with regard to the calculation of Mr Di Crescenzo' s pension as from 1 January 1981 and against the judgment acknowledging Mrs Casagrande' s entitlement to a full survivor' s pension.
11 Taking the view that the disputes raised problems of the interpretation of Community law, the Cour du Travail, Liège, stayed the proceedings and referred the following questions, identical in both cases, to the Court for a preliminary ruling:
"1. When a pension (in this case, a full pension) is granted by virtue of Belgian legislation alone, should the whole of Article 46 of Regulation No 1408/71 ° that is to say, including paragraph (3) ° be applied for the purpose of allowing or disallowing the overlapping of a benefit with a pension granted by another Member State (in this case, Italy)? Does the case-law arising from the Petroni judgment and subsequent judgments to the same effect continue to serve any real purpose?
2. Is the principle the same when the benefit in question is not a retirement pension calculated on the basis of the years of insurance completed, or treated as such, but an invalidity pension paid by the Fonds National de Retraite des Ouvriers Mineurs (National Pension Fund for Miners) which is the same for all, subject only to variations relating to family circumstances?
3. Where the second sentence of Article 12(2) of Regulation No 1408/71 suspends a national provision against overlapping which reduces the benefit entitlement determined solely on the basis of periods of insurance in the Member State under consideration by reference to the entitlement to benefits of the same kind acquired in another Member State, can that suspension lead to the reduction of the national benefit pursuant to Article 46(3) of Regulation No 1408/71 when it has not been necessary to aggregate the periods of insurance in order to create an entitlement to benefits in that State and when the only effect of the second sentence of Article 12(2) of the regulation has been to preserve an entitlement acquired under national legislation alone?"
12 Reference is made to the Report for the Hearing for a fuller account of the facts of the main proceedings, the course of the procedure and the written observations submitted to the Court, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court.
The first and third questions
13 It is apparent from the statement of the reasons on which the judgments for reference were based that by these questions, which it is appropriate to examine together, the national court is essentially seeking to ascertain whether the competent institution of a Member State is required to apply Article 46 of Regulation No 1408/71 in its entirety, including paragraph 3, when a migrant worker is entitled to a full retirement pension under national legislation alone and whether, in such circumstances, Article 12(2) of the same regulation suspends a national provision against overlapping which reduces the benefit entitlement because the migrant worker also receives a pension in another Member State.
14 As a preliminary observation, it should be pointed out that the Court ruled in Case 24/75 Petroni v ONPTS [1975] ECR 1149 that the aim of Articles 48 to 51 of the EEC Treaty would not be attained if, as a consequence of the exercise of their right to freedom of movement, workers were to lose advantages in the field of social security guaranteed to them in any event by the laws of a single Member State. It follows that the application of the Community rules cannot bring about a reduction in the benefits awarded by virtue of the legislation of one Member State (see Case 807/79 Gravina v Landesversicherungsanstalt Schwaben [1980] ECR 2205).
15 However, it should be pointed out that, as the Court has consistently held (see, most recently, Case C-5/91 Di Prinzio v Office National des Pensions [1992] ECR I-897), where a migrant worker receives a pension by virtue of the legislation of a single Member State' s national legislation alone, the provisions of Regulation No 1408/71 do not preclude that national legislation from being applied to him in its entirety, including any rules in that legislation against the overlapping of benefits.
16 It follows from the same case-law that if the application of the legislation of the Member State in question alone proves less favourable to the worker than that of the Community scheme set out in Article 46 of Regulation No 1408/71 the provisions of that article must be applied in their entirety.
17 Consequently, it is for the competent institution to compare the benefits which would be due under national law alone, including its provisions against the overlapping of benefits, with those which would be due under Community law, including the provision against overlapping set out in Article 46(3) of Regulation No 1408/71, and to ensure that the migrant worker receives whichever benefit is the higher.
18 Pursuant to Article 12(2) of Regulation No 1408/71, the provisions for reduction of benefits laid down in the legislation of a Member State where a benefit overlaps with other social security benefits acquired under the legislation of another Member State are not applicable where the person concerned receives old-age benefits of the same kind paid in accordance with Article 46 of that regulation.
19 The calculation of the amount of the benefits in accordance with Article 46 of Regulation No 1408/71 must be carried out in three stages. First, the competent institution calculates the "independent" benefit in accordance with the first subparagraph of Article 46(1) of the regulation. Secondly, pursuant to the second subparagraph of Article 46(1), it calculates the amount of the "pro rata" benefit in accordance with Article 46(2). Thirdly, in accordance with the second sentence of the second subparagraph of Article 46(1), the competent institution compares the independent benefit and the pro rata benefit and takes into consideration the higher of those two amounts. Fourthly, it applies the Community rule against overlapping set out in Article 46(3).
20 At the first stage, that is when calculating the independent benefit, the competent institution is to determine, according to its own legislation, the amount of the benefit corresponding to the total length of periods of insurance or residence to be taken into account under that legislation alone. In accordance with Article 12(2) of Regulation No 1408/71, the national provisions for reduction of benefit are not applicable.
21 In that respect, it should be noted that a national provision which reduces the additional years of notional employment from which the worker may benefit by the number of years in respect of which he may claim a pension in another Member State constitutes a provision for reduction of benefit within the meaning of Article 12(2) of Regulation No 1408/71 (see the Di Prinzio judgment).
22 Thus where the legislation of a Member State, by adding a number of notional or presumed years to the period of actual employment or period treated as such and disregarding any national provision for reduction of benefit, grants entitlement to a full pension, the independent benefit due under the first subparagraph of Article 46(1) is equal to the full pension.
23 The second stage, that is the calculation of the pro rata pension, takes place in two steps. In the first step, the competent institution determines, pursuant to Article 46(2)(a) of Regulation No 1408/71, the theoretical amount of the benefit. In the second step it calculates, in accordance with Article 46(2)(b), the actual amount of the benefit.
24 Article 46(2)(a) provides that the theoretical amount of the benefit is to be that which the person concerned could claim if all the insurance period completed in different Member States had been completed in the State in question and under the legislation administered by the institution on the date the benefit is awarded.
25 In that context, it should be pointed out, first of all, that Article 46(2)(c) provides that the total length of insurance periods may not be longer than the maximum period required by the legislation of the Member State to which the institution making the calculation belongs for receipt of full benefit. It follows that, where the person concerned is entitled to a full pension under the legislation of a single Member State, without having recourse to the aggregation of periods completed under the legislation of the other Member States, it is not necessary to take those periods into account to supplement the periods completed under the legislation of the first Member State for the purposes of acquiring the right to the benefits. In such circumstances the theoretical amount of the benefit is to be determined by the competent institution without taking account of the insurance periods completed by the person concerned in another Member State.
26 It should then be pointed out that it follows from the wording of Article 46(2)(a) of Regulation No 1408/71 that the competent institution is to apply the national legislation in its entirety. Consequently, if the national legislation provides that the benefit must be calculated according not only to actual periods of employment or periods treated as such but also to a number of notional or presumed years, those years must also be taken into consideration in calculating the theoretical amount of the benefit.
27 It should finally be pointed out that, pursuant to Article 12(2) of Regulation No 1408/71, the competent institution, when determining the theoretical amount, must disregard any national provision for reduction of benefit. It follows that in cases such as those before the court of reference the theoretical amount of the pension is to be equal to the amount of the full pension due in the Member State in question.
28 The actual amount of the benefit is calculated, in accordance with Article 46(2)(b) of Regulation No 1408/71, on the basis of the theoretical amount previously calculated and in the ratio which the length of the insurance periods completed before the risk materializes under the legislation administered by the institution bears to the total length of the insurance periods completed under the legislations of all the Member States concerned before the risk materialized.
29 It follows from the Di Prinzio judgment that in cases such as those referred to in the main proceedings where the national legislation recognizes notional or presumed periods completed before the risk materialized, those notional or presumed periods must be taken into consideration for the purposes of calculating the pro rata amount.
30 The third stage consists in comparing the independent benefit with the pro rata benefit in order to determine which of the two amounts is higher. In that respect, it is sufficient to state that in cases such as those before the court of reference, where the theoretical amount of the benefit is equal to that of the independent benefit, the amount of the pro rata benefit is necessarily less than that of the independent benefit. It follows that the application of Article 46(2) of Regulation No 1408/71 cannot produce a more favourable result for the worker.
31 The fourth stage is the application of the Community rule against the overlapping of benefits. The competent institution is thus required to ascertain whether the total of all the benefits, independent and pro rata, which the worker may claim does not exceed the ceiling provided for in Article 46(3), namely the highest theoretical amount. That rule continues to apply in cases such as those in the main proceedings in which the theoretical amount is equal to the full benefit payable under the legislation of one Member State alone (see Case C-199/88 Cabras v Institut National d' Assurance Maladie-Invalidité [1990] ECR I-1023).
32 If that ceiling is exceeded, the competent institution must reduce the benefit as provided for in the second subparagraph of Article 46(3) of Regulation No 1408/71, which applies to the exclusion of any national provision for reduction of benefit (see the Di Prinzio judgment).
33 Where there is only one institution providing an independent benefit, it must adjust that benefit by reducing it, pursuant to the second subparagraph of Article 46(3), by the full amount by which the total sum of the independent benefit and the pro rata benefits exceeds the highest theoretical amount (see Case 323/86 Collini v ONPTS [1987] ECR 5489).
34 After making the calculation provided for in Article 46 of Regulation No 1408/71, the competent institution must, as indicated in paragraph 16 of this judgment, compare the amount of the benefit which would be due under national legislation alone, including its provisions against overlapping, and the amount of the benefit which would be due under Community law, including its provisions against overlapping, applied in its entirety. In accordance with case-law, Article 46 of Regulation No 1408/71 cannot be applied unless it enables the migrant worker to be awarded a benefit at least as high as that due under the applicable national legislation alone (see the Cabras judgment).
35 It follows that the answer to the first and third questions referred to the Court by the court of reference must be that Articles 46 and 12(2) of Regulation (EEC) No 1408/71 of the Council of 14 June 1971 on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community, codified by Council Regulation (EEC) No 2001/83 of 2 June 1983, must be interpreted as meaning that, for the purposes of determining a benefit due solely under its national legislation, the competent institution must apply solely the national provisions against overlapping benefits. On the other hand, for the purposes of determining the benefit payable under Community law, the competent institution must not take account of the national rules against overlapping pursuant to Article 12(2) of the regulation, but, if necessary, adjust the amount of the benefit payable, pursuant to Article 46(3). The worker is entitled to the highest amount of the benefits resulting from those calculations.
The second question
36 It is apparent from the documents in the case and from the observations submitted by the representatives of the parties to the main proceedings at the hearing that the second question, which deals with the system applied for the granting of an invalidity pension by the Fonds National de Retraite des Ouvriers Mineurs, is irrelevant to the disputes underlying the reference for a preliminary ruling. In the absence of any other information from the national court, there is thus no need to answer that question.
Decision on costs
Costs
37 The costs incurred by the Commission of the European Communities, which has submitted observations to the Court, are not recoverable. Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court.
Operative part
On those grounds,
THE COURT (Fifth Chamber),
in answer to the questions referred to it by the Cour du Travail de Liège by two judgments of 22 February 1991, hereby rules:
Articles 46 and 12(2) of Regulation (EEC) No 1408/71 of the Council of 14 June 1971 on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community, codified by Council Regulation (EEC) No 2001/83 of 2 June 1983, must be interpreted as meaning that, for the purposes of determining a benefit due solely under its national legislation, the competent institution must apply solely the national provisions against overlapping benefits. On the other hand, for the purposes of determining the benefit due under Community law, the competent institution must not take account of the national rules against overlapping pursuant to Article 12(2) of the regulation, but, if necessary, adjust the amount of the benefit payable, pursuant to Article 46(3). The worker is entitled to the highest amount of the benefits resulting from those calculations.