CELEX: 62002CJ0386
Free movement of persons
Compensation for ex-prisoners of war
Requirement to hold the nationality of the Member State concerned at the time of submission of the request for compensation

The reference for a preliminary ruling concerns the interpretation of Article 39(2) EC.
That reference was made as part of an appeal brought by Mr Baldinger, the applicant in the main proceedings, against the refusal
of the Pensionsversicherungsanstalt der Arbeiter, the defendant in the main proceedings, to grant him a monthly allowance
for former prisoners of war provided for by Austrian legislation.
Legal background
Community law
As provided by Article 4(4) thereof, Council Regulation (EEC) No 1408/71 of 14 June 1971 on the application of social security
schemes to employed persons and their families moving within the Community, as amended and updated by Council Regulation (EC)
No 118/97 of 2 December 1996 (OJ 1997 L 28, p. 1; hereinafter ‘Regulation No 1408/71’), does not apply to ‘benefit schemes
for victims of war or its consequences’.
Article 7(1) and (2) of Council Regulation (EEC) No 1612/68 of 15 October 1968 on freedom of movement for workers within the
Community  (OJ, English Special Edition 1968 (II), p. 475) provides:
‘1. A worker who is a national of a Member State may not, in the territory of another Member State, be treated differently
from national workers by reason of his nationality in respect of any conditions of employment and work, in particular as regards
remuneration, dismissal, and should he become unemployed, reinstatement or re-employment;
2. He shall enjoy the same social and tax advantages as national workers.’
Austrian legislation
Under Paragraph 1 of the Kriegsgefangenenentschädigungsgesetz (Law on Compensation for Prisoners of War, in the version published
in the BGBl. I, No 40/2002, hereinafter the ‘KGEG’):
‘Austrian nationals who
1. became prisoners of war in the course of the First or Second World War; or
2. were taken into custody and detained by a foreign power for political or military reasons in the course of the Second World
War or during the period when Austria was occupied by the allied forces; or
3. were outside the territory of the Republic of Austria as a result of political persecution or the threat of political persecution
within the meaning of the Opferfürsorgegesetz (Law on Victim Welfare) BGBl. No 183/1947, and for the reasons referred to in
subparagraph 2 above were taken into custody by a foreign power and detained after the start of the Second World War,
shall be entitled to a payment in accordance with the provisions of this federal law.’
Paragraph 4 of the KGEG provides:
‘(1) Any person entitled under this federal law shall receive a monthly payment twelve times per year in the amount of:
14.53 Euros, if he was a prisoner of war within the meaning of Paragraph 1 for at least three months;
21.8 Euros, if he was a prisoner of war within the meaning of Paragraph 1 for at least two years;
29.07 Euros, if he was a prisoner of war within the meaning of Paragraph 1 for at least four years; and
36.34 Euros, if he was a prisoner of war within the meaning of Paragraph 1 for at least six years.
(2) Payments made under subparagraph 1 shall not be regarded as income when assessing compensatory allowances (Ausgleichszulagen)
under statutory social security provisions ...’
Paragraph 11(1) of the KGEG states:
‘The following bodies shall be responsible for determining the position in cases covered by this federal law:
1. for persons in receipt of a retirement allowance or pension ... , the social security insurance body responsible for paying
the retirement allowance or pension, with the exception of the General Accident Insurance Authority;
2. for persons in receipt of a federal civil servant’s pension (Ruhegenuss), a survivor’s pension (Versorgungsgenuss), a transitional
benefit (Übergangsbeitrag), welfare benefits (Versorgungsgeld), maintenance benefits (Unterhaltungsbeitrag) or a benefit paid
on honourable discharge (Emeritierungsbezug), the Federal Pension Authority (Bundespensionsamt);
…
7. for persons in receipt of pensions, benefits or compensation under the Kriegsopferversorgungsgesetz (Law on the Welfare
of War Victims), the Heeresversorgungsgesetz (Law on the Welfare of Army Personnel) and persons in receipt of financial assistance
under the Verbrechensopfergesetz (Law on Victims of Crime), the Federal Authority for Social Affairs and Matters relating
to Disabled Persons;
8. in all other cases, the Federal Authority for Social Affairs and Matters relating to Disabled Persons ... .’
The main proceedings and the question referred
It is apparent from the order for referral that Mr Baldinger was born in Austria on 19 April 1927 and that he had acquired
nationality of that State.  From January 1945 to May 1945 he served in the Second World War as a soldier in the Deutsche Wehrmacht
(German armed forces). From 8 May 1945 to 27 December 1947 he was held as a prisoner of war in the Union of Soviet Socialist
Republics.
Mr Baldinger subsequently worked in Austria, then, in 1954, left that country to seek employment in Sweden where he worked
until 1964, before again working in Austria from 1964 to 1965.  In April 1965 he emigrated on a long-term basis to Sweden,
worked there and, in 1967, took Swedish nationality, at the same time renouncing his Austrian nationality.
Since 1 May 1986, Mr Baldinger has been receiving an invalidity and old-age pension from the defendant in the main proceedings.
The application made by Mr Baldinger to the defendant for the allowance under the KGEG was rejected by a decision of 1 March
2002, against which an appeal seeking annulment was lodged before the national court.
That court notes that the disputed allowance, introduced in Austrian legislation in 2000, is not linked to the beneficiary’s
status as a worker or to the acquisition, on that basis, of acquired rights, in particular the right to a pension.  Regulation
No 1408/71, cited above, does not apply to benefit schemes instituted in favour of victims of war or its consequences.  In
such schemes, benefit is granted in order to compensate victims on the basis of the particular interest of the paying State.
Mr Baldinger fulfils the conditions for the grant of the disputed allowance.  However, it was refused him on the sole ground
that, after having been a prisoner of war, he accepted work in another Member State of the European Union and that finally
he acquired the nationality of that State.  The national court asks whether that legal consequence, which, by its effects,
could be considered indirect discrimination on the basis of nationality and use of the right of free movement of workers,
is compatible with Community law, particularly as it arises from a law adopted after the accession of the Republic of Austria
and the Kingdom of Sweden to the European Union.
In those circumstances, the Arbeits- und Sozialgericht Wien decided to stay the proceedings and to refer the following question
to the Court for a preliminary ruling:
‘Is Article 48(2) of the EC Treaty [now, after amendment, Article 39(2) EC], on the free movement of workers, to be interpreted
as precluding a national rule which provides that entitlement to financial compensation first legislated for in the year 2000
for persons who
1. became prisoners of war in the course of the First or Second World War; or
2. were taken into custody and detained by a foreign power for political or military reasons in the course of the Second World
War or during the period when Austria was occupied by the allied forces; or
3. were outside the territory of the Republic of Austria as a result of political persecution or the threat of political persecution
and were taken into custody for political or military reasons by a foreign power and detained after the start of the Second
World War,
is to be conditional on such persons holding Austrian nationality at the time of application?’
The question referred
It is to be remembered in this regard that it is not for the Court of Justice to rule on the interpretation of provisions
of national law but that it must take account, under the division of jurisdiction between the Community Courts and the national
courts, of the factual and legislative context, as described in the order for reference, in which the question put to it is
set (see, inter alia, Case C-224/02
Pusa
[2004] ECR I-0000, paragraph 37).
According to the national court, Paragraph 1 of the KGEG, in so far as it concerns ‘Austrian nationals’, is to be interpreted
as meaning that the benefit of the allowance granted thereunder in favour of former prisoners of war is subject to the condition
that that citizen should possess Austrian nationality at the time when the application for that allowance is made.  The national
court questions whether such a condition is compatible with the Community provisions on the free movement of workers.
Article 4 of Regulation No 1408/71, which defines the material scope of that regulation, provides in paragraph (4) that the
regulation does not apply to ‘benefit schemes for victims of war or its consequences’.
An allowance such as that at issue in the main proceedings, apart from not being linked to the status of worker, is provided
to former prisoners of war, who prove that they underwent a long period of captivity, in testimony of national gratitude for
the hardships they endured and is thus paid as a quid pro quo for the service they rendered to their country.
Having regard to that aim and those conditions for its grant, such an allowance is covered by Article 4(4) of Regulation No
1408/71, such that it is excluded from the material scope of that regulation (see, in that regard, Case 9/78
Gillard and Caisse régionale d’assurance maladie du Nord-Est
[1978] ECR 1661, paragraph 13, and Case 207/78
Even and ONPTS
[1979] ECR 2019, paragraphs 12 to 14).
Furthermore, for the same reasons, such an allowance does not fall within the category of advantages granted to national workers
principally because of their status as workers or national residents and, as a result, does not fulfil the essential characteristics
of the ‘social advantages’ referred to in Article 7(2) of Regulation (EEC) No 1612/68 (
Even and ONPTS
, cited above, paragraphs 20 to 24).
The same conclusion must be reached in the light of Article 39(2) EC which covers conditions of employment, remuneration and
other working conditions, which cannot cover compensatory allowances which are linked to service rendered in wartime by citizens
to their own country and whose essential aim is to provide those citizens with a benefit because of the hardships they endured
for that country.
In those circumstances, the answer to the question referred must be that Article 39(2) EC, Article 4(4) of Regulation No 1408/71
and Article 7(2) of Regulation No 1612/68 must be interpreted as not precluding national legislation which, in circumstances
such as those in the main proceedings, refuses to grant an allowance in favour of former prisoners of war on the ground that
the applicant did not hold the nationality of the Member State involved when the application was made, but that of another
Member State.
Costs
Since these proceedings are, for the parties to the main proceedings, a step in the proceedings pending before the national
court, the decision on costs is a matter for that court.  Costs incurred in submitting observations to the Court, other than
the costs of those parties, are not recoverable.
On those grounds, the Court (Second Chamber) rules as follows:
1.
Article 39(2) EC, Article 4(4) of Council Regulation (EEC) No 1408/71 of 14 June 1971 on the application of social security
schemes to employed persons and their families moving within the Community, as amended and updated by Council Regulation (EC)
No 118/97 of 2 December 1996, and Article 7(2) of Council Regulation (EEC) No 1612/68 of 15 October 1968 on freedom of movement
for workers within the Community, must be interpreted as not precluding national legislation which, in circumstances such
as those in the main proceedings, refuses to grant an allowance in favour of former prisoners of war on the ground that the
applicant did not hold the nationality of the Member State involved when the application was made, but that of another Member
State.
Signatures.
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Language of the case: German.