61978C0180
OPINION OF MR ADVOCATE GENERAL CAPOTORTI
DELIVERED ON 16 MAY 1979 (
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Mr President,
Member of the Court,
1.
The origin of the present proceedings is a reference for a preliminary ruling on a question of interpretation submitted by a Netherlands court, namely the Centrale Raad van Beroep, in the context of a dispute over the application of Netherlands rules against the overlapping of benefits in the field of pensions. The appellant in the main action, Mrs Brouwer-Kaune, worked as an employed person in two Member States: in Germany from 1928 to 1950 and in the Netherlands from 1951 to 1972. From 1950 to 1957 she continued voluntarily to pay contributions in Germany in respect of invalidity and old-age insurance so as to reach the total period of contributions necessary to obtain a pension. In 1970, following a medical examination which the person concerned underwent at the competent German social security institution, she was' declared partially incapacitated for work and as a result obtained, as from 1 August of that year, an occupational invalidity pension under the Federal legislation, for which purpose the German insurance periods were not aggregated with those completed in the Netherlands. Subsequently, by a decision of 16 August 1974, that pension was converted, retroactively with effect from 1 August 1973, into an old-age pension.
In the meantime, the Netherlands social security institution, having in turn recognized Mrs Brouwer-Kaune as being incapacitated for work, granted her, by a decision of 25 October 1973, an occupational invalidity pension with effect from 2 October 1973. In this regard, it should be pointed out that the legislation of the Netherlands, unlike that in force in the Federal Republic, is of the type whereby the amount of the invalidity benefit is independent of the duration of periods of insurance: that is to say, of the type covered by Article 37 (1) of Regulation No 1408/71. But by a decision of 13 January 1976 the aforesaid Netherlands institution, taking account of the recipient's enjoyment of the German old-age pension, applied the rule against the overlapping of benefits contained in Article 1 of the Netherlands Koninklijk Besluit [Royal Decree] of 22 December 1972, under which, if an invalidity pension is payable concurrently with other invalidity or old-age pensions, only that part of it which exceeds the amount of those other pensions is paid. Consequently, the entire amount of the German pension was deducted from the payments due by virtue of the Netherlands pension (and with retroactive effect).
The person concerned challenged the decision against overlapping before the Raad van Beroep, but without success. She therefore lodged an appeal before the Centrale Raad van Beroep and, whilst that court found the reduction of the invalidity pension well-founded under the national legislation considered in isolation, it raised the question whether such reduction was compatible with Community law. That led it to submit to the Court of Justice, by an order of 16 May 1978, the following question:
‘Must Article 40 (1) of Regulation No 1408/71 considered in the light of Article 43 be interpreted to mean that Chapter 3 (especially Article 46) is also applicable by analogy when there is a right to invalidity benefit under the legislation of a Member State of the type referred to in Article 37 (1) of the regulation and the interested party satisfies the conditions laid down in one of the legislations, not listed in Annex III, of another Member State for the right to benefit if the first-mentioned benefit must be awarded to a person who already has a claim to an old-age pension under the legislation of the last-mentioned Member State?’
2.
For a better understanding of the problem under consideration a brief summary is required of the content of the Community rules on which the solution must be based. The said Article 40 (1) of Regulation No 1408/71 belongs to Chapter 2 of Title III, which chapter concerns invalidity benefits; however, Article 40 (1) refers to the rules contained in Chapter 3 (old-age and death), declaring them applicable by analogy in relation to invalidity benefits enjoyed by a worker who has been successively or alternately subject to the legislations of two or more Member States, of which at least one is not of the type referred to in Article 37 (1) (that is to say of the type whereby the amount of invalidity benefit is independent of the duration of periods of insurance). Article 40 (1) further provides that the application by analogy of Chapter 3 shall take into account the provisions of paragraph (3), but that paragraph is not relevant to the case under consideration.
As regards Chapter 3, the rule which appears to be of the greatest significance for the purpose of this case is Article 46, entitled ‘Award of benefits’. That provision lays down the methods for determining the amount of (invalidity) benefit payable by the competent institution of each of the Member States to whose legislation the worker has been subject, either where the requirements for the acquisition of the right to benefit are satisfied without its being necessary to apply Article 45 (that is to say, to take account of insurance periods completed under the several laws to which the worker has been subject) or where that is not so. The importance of Article 46, in the context of this case, resides above all in the fact that it imposes limits on the operation of internal rules against the overlapping of benefits, since, adopting the criterion of apportionment, it prevents one of a number of possible concurrent benefits from being reduced below the amount which is due pro rata.
Next, Article 43, requires particular attention. That provision concerns the ‘conversion of invalidity benefits into old age benefits’: that is to say, it deals with the situation which occurred in the present case with regard to the German invalidity pension. And it must be emphasized that paragraph (2) permits the overlapping of insurance benefits, in particular invalidity benefits for which one Member State is responsible and old-age benefits for which another Member State is responsible, providing that ‘Any institution of a Member State which is responsible for providing invalidity benefits shall, where a person receiving invalidity benefits can, by virtue of Article 49, establish a claim to old-age benefits under the legislation of other Member States, continue to provide such person with the invalidity benefits to which he is entitled under the legislation which it administers until the provisions of paragraph (1) become applicable as regards that institution’ (that is to say, until the invalidity benefits granted are also converted into old-age benefits). But the Netherlands court did not accept that that article applies to the situation with which we are concerned, considering the provisions of the said paragraph (2) to be limited to the situation where a worker enjoyed two invalidity pensions concurrently before the conversion of one of them into an old-age pension (that conclusion follows from the expression ‘Any institution … shall … continue to provide’). In this case, as we have seen, the Netherlands invalidity pension was granted, as from 2 October 1973, while the conversion of the German invalidity pension into an old-age pension took effect (retroactively) as from 1 August 1973. In those circumstances the person concerned began to enjoy the invalidity pension in the Netherlands after the date on which the conversion of the German pension into an old-age pension took effect.
It is for that reason that the Netherlands court considered Article 43 inapplicable to the case with which we are concerned. Notwithstanding that, in framing the question referred for a preliminary ruling it suggested that Article 40 (1) should be interpreted ‘in the light of Article 32’. In that way, no doubt, it wished to underline the expediency of interpreting Article 40 (1) taking account of Article 43 and in a manner consonant with that provision, in view of the considerable similarity between the situation which has arisen in this case (invalidity benefits granted to a person who is already entitled, in another Member State, to old-age benefits resulting from the conversion of a former invalidity pension) and the situation in which Article 43 would certainly be applicable (invalidity benefits which continue to be paid to a person who had been entitled at the same time, in another Member State, to similar benefits which were subsequently convened into old-age benefits).
In this context it is wonh pointing out an unusual feature of this case: although it is indeed true that the Netherlands invalidity pension became payable later than the German old-age pension, none the less the Netherlands benefit was granted on a date (25 October 1973) prior to the date (16 August 1974) of the German decision to convert the invalidity benefit into an old-age pension, so that in the period between the first and the second date the person concerned enjoyed two invalidity pensions concurrently. Ought the Netherlands court to have taken account of that fact before deciding that Article 43 was not applicable? It is possible to avoid answering that question, pointing out that, under Article 177 of the EEC Treaty, it is not for the Community Court to rule on the application of one rule or another to a particular factual situation, and that the national court clearly confined itself to requesting an interpretation of Article 40 (1). But it seems to me that the most appropriate line for the Court of Justice to adopt is the following: to adhere to the basic premises of the national court (that is to say, once again, that a worker is entitled to the invalidity benefit in one Member State after having benefited, in another Member State, from the conversion of an invalidity pension into an old-age pension), and to seek to establish how those premises must be appraised in the light of Community law, and, more particularly, in the light of Regulation No 1408/71, without restricting the examination to one or other of its provisions.
3.
Working on that basis, let us examine the question first of all in the light of Article 40 (1). There is no doubt that in cases such as the one described the two conditions laid down in the said provision are satisfied: the worker concerned has been successively subject to the legislations (in the field of invalidity) of two Member States, and one of those legislations is not of the type referred to in Article 37 (1); moreover, the very wording of the question presupposes that both the conditions are satisfied, since it refers to the situation where the right to an invalidity pension exists under the law of one Member State, of the type referred to in Article 37 (1), and where the person concerned satisfies the requirements on the basis of which he may be accorded a similar right under the legislation of another Member State, of a type different from that referred to in Article 37 (1). So where is the origin of the doubts, evinced by the Netherlands court, concerning the applicability by analogy of Chapter 3? To ask whether the provisions of that Chapter are applicable amounts to asking whether Article 40 itself is applicable, since that article, in fact, merely deals, by means of a reference to Chapter 3, with invalidity benefits in favour of workers who are in the situation described there. In the hypothesis adopted by the national court, for the purpose of determining the amount of invalidity benefits, where the worker is in the situation envisaged in Article 40 (1) there is no doubt that that article — and, consequently, Chapter 3 — are applicable.
It seems to me, therefore, that the question submitted by the Netherlands court means something different. We know the problem which it wishes to resolve: namely, whether or not it is possible to infer from Regulation No 1408/71 a limit to the applicability of national provisions against overlapping in a case such as that which gave rise to the present action. We have seen why the court was persuaded that Article 43 is inapplicable: the worker entitled to the invalidity pension has already obtained an old-age pension under the law of another Member State. The only provision of Regulation No 1408/71 which could, according to the Netherlands court, limit to a certain extent the applicability of national rules against overlapping is Article 46. Thus, in my opinion, what the question means is this: does Article 46 apply only where benefits of the same type are awarded concurrently (two invalidity benefits granted in two Member States) or does it apply also to a case of the concurrent award of benefits of different types (invalidity on the one hand and old-age on the other)? Those are the two alternative hypotheses which in fact correspond to the problem raised by the national court.
4.
In support of the first of these hypotheses one could argue that Article 46 must be interpreted in accordance with Article 12 (2) of the Regulation. That provision lays down that ‘The legislative provisions of a Member State for reduction, suspension, or withdrawal of benefit in cases of overlapping with other social security benefits or other income may be invoked even though the right to such benefits was acquired under the legislation of another Member State …’; and it goes on to state that ‘this provision shall not apply when the person concerned receives benefits of the same kind in respect of invalidity, old-age, death (pensions) or occupational disease which are awarded by the institutions of two or more Member States in accordance with Articles 46, 50, 51 or Article 60 (1) (b)’.
It should further be borne in mind that on the subject of restrictions on the applicability of national rules against overlapping this Court has laid down case-law, some of it recent, which is clearly favourable to the interests of the worker. But until now, the need to limit the effects of national provisions against overlapping has been recognized in relation to situations in which two invalidity pensions or two pensions for a surviving spouse were awarded concurrently. It is worth citing in particular the judgment of 13 October 1977 in Case 22/77 Mura [1977] ECR 1699; there the Court, after declaring that ‘so long as a worker is receiving a pension by virtue of national legislation alone, the provisions of Regulation No 1408/71 do not prevent the national legislation, including the national rules against the overlapping of benefits, from being applied to him in its entirety’, laid down that ‘if the application of national provisions on entitlement and calculation alone is less advantageous for the worker than the application of the rules for aggregation and apportionment, the latter must be applied’. That principle was inferred from the said Article 46 (1), interpreted as a rule restricting the applicability of internal rules against the overlapping of benefits. The same line was followed by the judgments of 13 October 1977 in Case 37/77 Greco [1977] 2 ECR 1711, of 14 March 1978 in Case 98/77 Schaap [1978] ECR 707 and also of 14 March 1978 in Case 105/77 Boerboom-Kersjes [1978] ECR 717.
In support of the second hypothesis one may point first of all to the fact that Article 46, in so far as it is referred to by Article 40 (1), is situated in the context of the rules concerning invalidity benefits, and thus in the same context as the said Article 43. I have already had occasion to observe that Article 43 permits overlapping between invalidity pensions and old-age pensions; and certainly it prevails over any contrary national provision; thus it precludes the provisions of Article 12 (2). With regard to Article 43 (3) the Commission rightly observed that it envisages only the possibility of a reduction, even in the case of a worker who receives an invalidity pension in one Member State and an old-age pension in another: so the benefits are allowed to overlap, albeit only to a certain extent, and the national rules against overlapping are applicable only when they lead to a more favourable result than that produced by way of apportionment. A correct, systematic interpretation of Article 46 should therefore lead to the conclusion, at least as regards the award of concurrent invalidity and old-age pensions, that the different nature of the benefits does not preclude the application of criteria designed to restrict the effect of national rules against the overlapping of benefits.
Returning to the case-law of the Court, cited above, I would point out that it is based on the assumption that the first sentence of the said Article 12 (2) applies and that the second sentence must be disregarded (see in particular paragraphs 13 and 14 of the decision in Mura). Thus a feature of the cases decided was that provisions contained in national laws for the reduction, suspension or withdrawal of benefit were, in principle, applicable. Notwithstanding that, the Court inferred from Article 46 (1) that the rules regarding overlapping and apportionment must be applied whenever the national provisions concerning the existence of the right to benefit and the calculation thereof prove less favourable for the worker. And even though, as I have already observed, the situations which gave rise to the requests for a preliminary ruling were particular examples of the award in two Member States of concurrent benefits of the same type, none the less the decisions of the Court were not expressly affected by that circumstance. In fact the only condition inherent in those decisions is that the case must involve a worker who receives a pension by virtue of national legislation alone; as happened in this case. By that I do not mean to state that the line followed in the cases cited may purely and simply be confirmed in this case; that is precluded by the tenor of the question submitted by the national court and by the situation to which it refers, which, it cannot be doubted, display special features. But it may certainly be regarded as established that, apart from the provision laid down by the second sentence of Article 12 (2) and in partial correction of the rule contained in the first sentence, the Court has accepted that Article 46 (1) restricts the effectiveness of rules against the overlapping of benefits; and it does so without, I repeat, requiring that the concurrent benefits be of the same kind.
Finally, I do not think it out of place to refer to the general objectives of the regulation concerned. The seventh and eighth recitals of the preamble to Regulation No 1408/71 state that ‘the provisions for co-ordination adopted for the implementation of Article 51 of the Treaty must guarantee to workers who move within the Community their accrued rights and advantages whilst not giving rise to unjustified overlapping of benefits’; and that ‘to this end, persons entitled to benefits for invalidity, old age and death (pensions) must be able to enjoy all the benefits which have accrued to them in the various Member States; whereas, however, in order to avoid unjustified overlapping of benefits, which could result in particular from the duplication of insurance periods and other periods treated as such, it is necessary to limit the benefits to the greatest amount which would have been due to a worker from one of these States if he had spent all his working life there’. Let us attempt to relate those general criteria to the present case. If the worker concerned has been employed only in Germany, for a period equal to the total of the periods of employment completed in Germany and the Netherlands (that is to say, from 1928 to 1972), there is no reason to think that she would have received in Germany an old-age pension considerably higher than the one which she currently enjoys on the basis of the period of employment from 1928 to 1957. So it would seem contrary to the general criteria referred to above to apply a national measure against the overlapping of benefits which, taking into account the old-age pension due to a worker in respect of the contribution periods completed under the legislation of another Member State, deducts the entire amount thereof from the invalidity benefit to which the same worker is entitled in his State of residence, even though the right to that benefit matured independently of those contribution periods. In general terms, that shows that the effects of the national provisions against the overlapping of benefits must be restricted even in the case of the award, in different States, of concurrent invalidity and old-age pensions to which the worker is entitled as a result of insurance periods completed mainly at different times in the two States concerned. If the case concerns national rules against the overlapping of benefits which take into consideration the old-age pension drawn by the insured person in another State, for the purpose of reducing his invalidity pension, the different nature of the two concurrent pensions must not be used to render inapplicable those Community principles or rules which guarantee the worker's entitlement to benefits, acquired in the State in which the aforesaid rules against overlapping are in force, at least within the limits of the apportionment provided for in Article 46.
5.
For those reasons I conclude by proposing that in answer to the request for a preliminary ruling submitted by the Centrale Raad van Beroep by an order of 16 May 1978, the Court should declare that, by virtue of Article 40 (1) of Regulation No 1408/71 of the Council, Article 46 of that regulation is also applicable to the award of invalidity benefits in one Member State, in which a worker's right to such benefits has been recognized under legislation of the type referred to in Article 37 (1), where, before acquiring that right, the person concerned has already become entitled to an old-age pension as a result of the conversion of a former invalidity pension by virtue of the legislation of another Member State not being of the type referred to in the said Article 37 (1).
(
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