Opinion of the Advocate General — ECLI:EU:C:2024:191
Date: 2024-02-29
Language of the case: German
Procedure: Reference for a preliminary ruling
Origin: Germany

summary, to determine whether mutual institutions like the applicants are market producers or non-market producers, an overall assessment must be carried out taking account of the general criteria laid down in paragraphs 3.16 to 3.26 and 1.37 of the ESA 2010, and paragraphs 2.55 to 2.62, 20.32 to 20.34 and 20.38 of the ESA 2010 relating to the activity of financial intermediation. V. Conclusion 118. In the light of the foregoing considerations, I propose that the Court of Justice reply to the Bundesverwaltungsgericht (Federal Administrative Court, Germany) as follows. Article 1(1) of Regulation (EU) 2018/231 of the European Central Bank of 26 January 2018 on statistical reporting requirements for pension funds, and, as a whole, the paragraphs included in Annex A to Regulation (EU) No 549/2013 of the European Parliament and of the Council of 21 May 2013 on the European system of national and regional accounts in the European Union, are to be interpreted as meaning that occupational mutual social insurance institutions created by organisations governed by public law, having a system of compulsory membership for the members of certain professions, constitute pension funds that are subject to statistical reporting requirements and not social security funds, where those institutions carry out financial intermediation in order to pay the pension, death and disability claims of their members, pay their operating costs using their members’ contributions, which are set by the institutions themselves, manage themselves, are responsible for their own financial management, and do not have State support to pay benefits to their members. 1 Original language: Spanish. 2 Regulation of the European Central Bank of 26 January 2018 on statistical reporting requirements for pension funds (ECB/2018/2) (OJ 2018 L 45, p. 3). 3 These are organisations that provide their (professional) members with benefits in the event of incapacity for work, retirement and death. 4 Which I shall refer to from now on as ‘the applicant mutual institutions’. 5 Regulation of the European Parliament and of the Council of 21 May 2013 on the European system of national and regional accounts in the European Union (OJ 2013 L 174, p. 1). 6 See, for example, judgments of 11 September 2019, FIG and FISE (C‑612/17 and C‑613/17, EU:C:2019:705; ‘the judgment in FIG and FISE’), and of 13 July 2023, Ferrovienord (C‑363/21 and C‑364/21, EU:C:2023:563; ‘the judgment in Ferrovienord’). 7 Law on the Public Insurance System of the Free State of Bavaria (‘VersoG’), in the version published on 16 June 2008 (BayGVBl. p. 371), last amended by Paragraph 32a(18) of the Law of 10 May 2022 (BayGVBl. p. 182) 8 Paragraph 30(1), in conjunction with Paragraph 33 et seq., of the VersoG. 9 Set out in Paragraph 30(2) of the VersoG. Those cases include temporary employment or employment involving a minimum number of hours’ work, or membership of another insurance institution. 10 Paragraph 30(3) of the VersoG, 11 Paragraph 10(2) and (3) of the VersoG. 12 Paragraph 31(4) of the VersoG. It is common ground that each institution pays out more than 50% of its benefits as compulsory benefits to compulsory members. 13 Law on Associations of Healthcare Professionals in the Free State of Saxony of 24 May 1994 (SächsGVBl., p. 935), last amended by Paragraph 18 of the Law of 21 May 2021 (SächsGVBl., p. 578); ‘the SächsHKaG’. 14 Statutes of the Pension fund for medical practitioners in the Free State of Saxony, in the version of 28 June 2008 (ÄBS 10/2008, p. 515), last amended by the 6th amendment of the statutes of 19 June 2021 (ÄBS 09/2021, p. 18); ‘the Statutes’. 15 See Paragraph 6(1), in conjunction with Paragraph 1, of the SächsHKaG, and Paragraph 1 of the Statutes. 16 See Paragraph 6(1), in conjunction with Paragraphs 1 and 2, of the SächsHKaG, in conjunction with Paragraphs 1 and 9 et seq. of the Statutes. 17 ECB, Assets and liabilities of pension funds, available at https://data.ecb.europa.eu/publications/financial-corporations/3030657. 18 PFs are one of the biggest investors in international capital markets. Their investments are diversified in terms of financial instruments, sectors and geographical location. Their role in the financing of general government and non-financial corporations in the euro zone, through investments in debt securities and shares and holdings, is also substantial. 19 Council Regulation of 23 November 1998 concerning the collection of statistical information by the European Central Bank (OJ 1998 L 318, p. 8). 20 In statistical terminology, this means persons or institutions required to provide certain information. 21 Recommendation for a Council Regulation amending Regulation (EC) No 2533/98 concerning the collection of statistical information by the European Central Bank (ECB/2008/9) (OJ 2008 C 251, p. 1). 22 Council Regulation of 9 October 2009 amending Regulation (EC) No 2533/98 concerning the collection of statistical information by the European Central Bank (OJ 2009 L 269, p. 1). 23 The same requirements had been imposed earlier on insurance undertakings by Regulation (EU) No 1374/2014 of the European Central Bank of 28 November 2014 on statistical reporting requirements for insurance corporations (ECB/2014/50) (OJ 2014 L 366, p. 36). 24 For example, life insurance and private pension insurance; the pension scheme for civil servants, established by the State; and pension schemes administered by employers. 25 Including doctors, pharmacists, architects, notaries, lawyers, tax advisers, veterinarians, accountants, dentists and engineers. 26 Annual Report of the Bayerische Versorgungskammer 2022, p. 12, available at BVK_2022_JB_EN_www_240523.pdf and the website of the Sächsische Ärzteversorgung https://www.saev.de/en/index.html. In its observations, the ECB states that the budget of all the PFs in the euro zone is EUR 3,123 billion. 27 Paragraph 1.01 of Annex A to Regulation No 549/2013. 28 Judgment in Ferrovienord, paragraph 64. 29 Judgment in Ferrovienord, paragraph 65. 30 Paragraph 1.25 of Annex A to Regulation No 549/2013. 31 Judgment in FIG and FISE, paragraphs 58 and 97. 32 Judgment in FIG and FISE, paragraph 37, and judgment of 28 April 2022, SeGec and Others (C‑277/21, EU:C:2022:318, paragraph 28). 33 Defined, essentially, in paragraphs 1.57 and 2.12 of Annex A to Regulation No 549/2013. According to the second sentence of paragraph 2.01 of Annex A, institutional units are economic entities that are capable of owning assets, incurring liabilities and engaging in economic activities and in transactions with other entities. An institutional unit is characterised by decision-making autonomy in the exercise of its principal function and by keeping a complete set of accounts, or being able to compile a complete set of accounts (paragraph 2.12 of Annex A). 34 In addition to those sectors, which form the whole of a national economy, there is a sixth institutional sector, the rest of the world sector, which reflects the relationship of non-resident units to the five national sectors. 35 From now on, individual references to the headings of the ESA 2010 are to be taken to refer to Annex A (which I shall omit, to avoid redundancy). 36 There was a discussion at the hearing concerning whether the applicant mutual institutions could be classified as non-profit institutions serving households (NPISH) (S.15); the applicants themselves (and the ECB) ruled out that classification. In so far as they carry out financial intermediation on capital markets to obtain profits which they then use to pay benefits to insured persons and to cover their administration costs, they do not come within the NPISH sector. That sector includes trade unions, professional or learned societies, consumers’ associations, political parties, churches or religious societies, and social, cultural, recreational and sports clubs, and charities, relief and aid organisations financed by voluntary transfers in cash or in kind from other institutional units. 37 Judgement in FIG and FISE, paragraph 34. 38 ‘A financial corporation or quasi-corporation that is principally engaged in financial intermediation as the consequence of the pooling of social risks and needs of the insured persons (social insurance). A pension fund as a social insurance scheme provides income in retirement and may provide benefits for death and disability.’ 39 First sentence of paragraph 2.107 of the ESA 2010. 40 Second sentence of paragraph 2.107 of the ESA 2010. 41 Paragraph 2.108 of the ESA 2010. 42 Paragraph 2.109 of the ESA 2010. 43 The fact that occupational mutual institutions are legal persons governed by public law does not preclude them from being regarded as PFs: paragraph 2.109 of the ESA 2010 provides for this. There is no need for the PF to be a private entity. A PF may be public but it is necessary for it to have organisational and management autonomy in order to act as a financial intermediary. 44 The final sentence of paragraph 2.117 of the ESA 2010 adds that there is usually no direct link between the amount of the contribution paid by members and the risk to which they are exposed. 45 The majority of the professional members of each of the applicant mutual institutions are subject to a statutory requirement of membership on the ground that they practise their profession in the Länder of Bavaria or Saxony. 46 For an institutional unit to be included in subsector S.129 as a PF, it is not necessary for all the benefits that it provides to its members to be based on a contractual insurance obligation. In accordance with paragraph 2.117 of the ESA 2010, an institutional entity may be a PF, even if its members are members by operation of law and not pursuant to a contractual insurance obligation. It is also possible for there to be a compulsory part of the membership and another voluntary part of the membership. Compulsory members who have left the occupational mutual institution may remain as voluntary members under the terms of the organisation’s statutes, in order to retain their right to obtain future pensions based on payment of the same contributions as compulsory members. 47 In particular, they must operate on a not-for-profit basis and must use their funds and assets solely for the purposes of carrying out their role as insurance providers and they must cover their administration costs, including employees’ salaries and beneficiaries’ benefits, from their own funds. 48 Order for reference, paragraph 30. 49 Transcribed in point 10 of this Opinion. 50 See, by analogy, judgment in FIG and FISE, paragraphs 37 and 38. 51 Paragraph 2.117 is part of Chapter 2 of the ESA 2010, which describes the institutional units used in measuring the economy, and how these units are classified into sectors and other groups to allow analysis (paragraph 1.03 of the ESA 2010). 52 According to the referring court, the term could also include other government units, or even administrative bodies responsible for providing the statutory pension insurance that are independent of the primary unit, allow for their members to be exempted from the statutory pension insurance scheme and are intended to ensure, for certain occupational groups, a self-administered old-age pension that is aligned to their contribution and benefit levels, but which are not subject to government control. The demarcation rule set out in paragraph 20.39 of the ESA 2010, which assumes that the benefits might also be ‘managed’ by a ‘separate institutional unit’ could lend credence to this proposition. 53 It adds that ‘a social security fund is an institutional unit if it is organised separately from the other activities of government units, holds its assets and liabilities separately, and engages in financial transactions on its own account’. 54 Paragraph 2.55 of the ESA 2010 adds that ‘such institutional units comprise all corporations and quasi-corporations which are principally engaged in: (a) financial intermediation (financial intermediaries); and/or (b) auxiliary financial activities (financial auxiliaries). Also included are institutional units providing financial services, where most of either their assets or their liabilities are not transacted on open markets’. According to paragraph 2.56 of the ESA 2010, ‘financial intermediation is the activity in which an institutional unit acquires financial assets and incurs liabilities on its own account by engaging in financial transactions on the market’. 55 Order for reference, paragraphs 11 and 12. 56 Paragraph 33 of its written observations. 57 ‘Sellers act to maximise their profits in the long term, and do so by selling goods and services freely on the market to whoever is prepared to pay the asking price; buyers act to maximise their utility given their limited resources, by buying according to which products best meet their needs at the offered price; effective markets exist where sellers and buyers have access to, and information on, the market. An effective market can operate even if these conditions are not met perfectly.’ 58 Paragraph 3.18(a) of the ESA 2010. 59 ‘… To be a market producer, the unit shall cover at least 50% of its costs by its sales over a sustained multi-year period.’ 60 Order for reference in Case C‑758/22, paragraph 14. 61 Order for reference in Case C‑758/22, paragraph 16. 62 The first-instance court held that the fact that the applicant mutual institutions covered at least half of their costs through the collection of contributions was sufficient to prove the existence of economically significant prices (and therefore that the applicant mutual institutions were market producers), even though the conditions laid down in paragraph 3.19(a) and (b) of the ESA 2010 were not fulfilled. 63 Order for reference in Case C‑758/22, paragraphs 17, 18 and 19. 64 Order for reference in Case C‑758/22, paragraph 15. 65 Judgment in FIG and FISE, paragraphs 34, 65 and 70, and judgment of 28 April 2022, SeGEC and Others (C‑277/21, EU:C:2022:318, paragraph 26). 66 In accordance with paragraph 2.33 of the ESA 2010, ‘the institutional units are grouped into sectors on the basis of the type of producer they are and depending on their principal activity and function, which are considered to be indicative of their economic behaviour’. 67 If a public financial unit manages assets but does not place itself at risk by incurring liabilities on its own account, it is classified in the general government sector rather than in the financial corporations sector (paragraph 20.33 of the ESA 2010). 68 Order for reference, paragraph 19.