61991CC0165(01)_EN
Opinion of the Advocate-General
Opinion of the Advocate-General
++++
Mr President,
Members of the Court,
1. The reopening of the oral procedure in this reference for a preliminary ruling has given rise to discussion which leads me to supplement my Opinion of 14 January 1993 with the following observations.
2. I shall not go back in any detail over the factual and legal background to this case, and refer instead to my first Opinion.
3. As the Court is aware, the national court wishes to know whether or not the Belgian legislation which it has to apply is compatible with the Community principles of freedom of movement for workers and equal treatment for men and women.
4. There are, to my mind, no new developments as regards the latter principle. On this point, I shall merely refer to my earlier Opinion. (1)
5. I shall confine myself therefore to the other aspect of the problem, with which both the questions asked by the Court with a view to reopening the oral procedure and also the hearing of 12 April 1994 were concerned, namely the following question: Do Articles 48 and 51 of the EEC Treaty preclude national legislation "from attaching different consequences to the award of pension benefits related to the situation of the non-working spouse according to whether the benefit is granted in the form of an increase in the pension of the active spouse or in the form of a separate pension granted to the non-working spouse ..."? (2)
6. With reference to the situation before the national court, does the fact that the pension payable to Mrs van Munster in the Netherlands (hereafter "Member State B"), by virtue of her years of residence in that State, no longer takes the form of an increase in her husband' s pension but that of a personal pension, while the total income of the couple in the Netherlands remains unchanged, permit the pension payable to her husband in Belgium ("Member State A") to be reduced by causing it to be paid at the single rate instead of the household rate, without infringing Articles 48 and 51 of the Treaty?
7. I have pointed out that the aim of Article 51 is the coordination, not the harmonization, of legislation. On this matter the Court has consistently held: "... Article 51 leaves in being differences between the Member States' social security systems and, consequently, in the rights of persons working in the Member States. It follows that substantive and procedural differences between the social security systems of individual Member States are unaffected by Article 51 of the Treaty". (3)
8. Coordination ° the present stage in the approximation of social security systems ° can neither mitigate the lack of any common social security system nor, consequently, plaster over the unavoidable differences that exist between the national systems. (4) The level of social protection varies from Member State to Member State and migrant workers cannot, for example, expect to receive the same level of social protection in the host State as in their State of origin. (5)
9. The Member States determine the conditions for affiliation to social security schemes, the detailed rules for awarding pensions ° number of years' insurance required, designation of recipients, retirement age ° and also the amount of the pensions and the methods for preventing overlapping of benefits. Each Member State is free to set the amount of the pensions it pays or of the contributions it receives and to establish the mechanisms making it possible to take into account the situation of the non-working spouse.
10. To acknowledge that rules may vary from Member State to Member State is also to accept that they may change. The Community legal system does not confer established rights to a particular pension, either in principle or in a given amount.
11. That system contains the seeds of unavoidable inequalities of treatment. The Commission gave a clear demonstration of this at the second hearing: If Mrs van Munster had been a month older than her husband, he would never have received a pension at the household rate because, on the day on which his retirement pension was calculated, his wife would have been entitled to a pension, whereas if she had been a month younger, he could have received it until she was granted a pension in her own right. Other examples reveal divergent treatment in very similar situations. (6) Those examples are plentiful.
12. That freedom of the Member States is not, however, boundless.
13. The result of the lack of harmonization of social systems cannot be to impede, in this area, the application of the great principles of Community law.
14. The same is true as regards the principle of equal treatment for men and women, on which I set out my views sufficiently in my first Opinion.
15. As I have already said, it is another principle, that of freedom of movement for workers, which is at the heart of the argument: what falls to be determined is whether, and if so, how far, that principle restricts the Member States' decision-making power in social matters.
16. Let me briefly recapitulate the Court' s decisions regarding the application of Articles 48 and 51 to the relevant social security legislation.
17. First, the Court has held, in a first series of judgments, that Article 48 precludes social security legislation containing discrimination on the grounds of nationality:
"... It is for the legislature of each Member State to lay down the conditions creating the right or the obligation to become affiliated to a social security scheme or to a particular branch under such a scheme, provided always that in this connection there is no discrimination between nationals of the host State and nationals of other Member States". (7)
18. Secondly, the Court has held, in a second series of decisions, that national rules, even where applied without distinction, are contrary to Article 48 if they deprive migrant workers of advantages enjoyed by non-migrant workers:
"... the aim of Articles 48 to 51 of the Treaty would not be attained if, as a consequence of the exercise of their right to freedom of movement, migrant workers were to lose the advantages in the field of social security guaranteed to them by the laws of a single Member State. Such a consequence could deter Community workers from exercising their right to freedom of movement and would therefore constitute an obstacle to that freedom ...
It is clear that a provision such as that in issue before the national court is liable, even though it applies without regard to the nationality of the workers concerned, to place migrant workers in a worse position as regards social security than those who have worked in only one Member State". (8)
19. The latter line of decisions, which applies at the social level the principle that restrictions on freedom of movement for workers, (9) even where not discriminatory, are incompatible with Article 48, encounters, in its turn, inevitable limits to its scope.
20. Thus, it cannot reasonably be maintained that domestic legislation of a Member State, which is not discriminatory, and which provides for higher contributions or lower pensions than does the legislation of another Member State, is incompatible with Article 48 on the ground that it deters workers from coming to the first State. (10) That article is not to be used as a basis for attempting to bring about by indirect means harmonization which is not provided for by Article 51.
21. In Hartmann Troiani, (11) the Commission had maintained that Article 48 required the abolition of even non-discriminatory obstacles to freedom of movement for workers.
22. In his Opinion in that case Advocate General Jacobs noted:
"It is undeniable ... that a broad interpretation must be given to Article 48. However, I am doubtful about the possibility of reliance on general Treaty provisions ° such as Article 48 ° in order to fill gaps in Community social security legislation". (12)
23. The fact remains that, according to the Court' s case-law, Article 48 precludes rules which either are discriminatory or deprive migrant workers of advantages enjoyed by non-migrant workers.
24. Does a situation such as that in the present case fall within either of those two hypotheses?
25. What is shocking in this situation is that the total income received by Mr and Mrs van Munster in Member State B has not changed at all; the amount of Mrs van Munster' s AOW pension is in fact equal to the reduction in her husband' s AOW pension brought about by withdrawing the increase which he had previously received on account of a dependent spouse. There is thus in fact nothing to offset the reduction of his pension in Member State A.
26. Does that outcome, however unfair it may be, make Member State A' s legislation incompatible with Community law? In other words, do the circumstances of the applicant in the main proceedings disclose discrimination or the loss of an advantage in the sense contemplated in the abovementioned case-law?
27. As I maintained in my previous Opinion, I consider that the Belgian legislation was originally not discriminatory or obstructive, but has become so. (13)
28. I intend, first, to show that Article 48 does not preclude legislation of the kind adopted by Member State A, considered as such. Secondly, I shall demonstrate the discriminatory nature of that legislation, having regard to the effects which it causes an amendment of legislation, such as that in Member State B, to produce.
I ° Article 48 does not preclude legislation of the kind adopted by Member State A, considered as such.
29. Two questions need to be considered here.
A ° Does such legislation, by itself, attach different consequences to the receipt of a pension in his or her own right by the spouse of the retired worker according to whether the pension is received in that State or in another Member State?
B ° More particularly, is there discrimination against the migrant worker where the spouse is not in work?
° A °
30. At first sight, legislation such as Royal Decree No 50 is in no way discriminatory. It applies to nationals and non-nationals without distinction. Does it apply differently to those who have never availed themselves of freedom of movement, on the one hand, and to migrant workers, on the other? Does it deprive the latter of an advantage enjoyed by the former? If a pension is paid in his or her own right to the spouse in Belgium or in another Member State, is the worker' s pension reduced to the single rate in the same circumstances? (14)
31. Let me consider the case of the spouse who receives a personal pension in Member State A.
32. In that State the pension may be waived, thus allowing the other spouse to keep the household rate pension. (15)
33. Thus, for example, the married couple receives either the household rate pension, (16) or the single rate pension with the addition of the personal pension. (17)
34. It follows that the social security income of the couple amounts at the least to the husband' s pension at the household rate and at the most to the husband' s pension at the single rate, increased by his wife' s own pension, benefits the total of which may be greater than the husband' s pension at the household rate. (18)
35. The case of the migrant worker whose spouse receives his or her individual pension in another Member State leads to the same result.
36. The individual pension received by the wife in Member State B may not be waived. It is deducted from the husband' s household rate pension in Member State A, (19) with the result that the couple' s total income is, in principle, equal at least to the husband' s pension at the household rate. (20)
37. The legislation of Member State A therefore produces legal consequences for the worker' s pension which are identical to the entitlements of the other spouse, whether those are acquired in that State or another Member State.
38. Let me dwell for a moment on the underlying objective of the national legislation which reduces the insured person' s pension from the household to the single rate, once the spouse of that person becomes entitled to an individual pension.
39. The household rate is designed for cases where the insured person has a dependent spouse. That is not generally the case where the spouse receives an individual pension. It follows that Community nationals in the latter position will lose the full rate. Indeed, it would be perverse if they continued to receive it, when their spouses had their own resources. The effect would be reverse discrimination disadvantaging non-migrant workers of Member State A. Those workers, it will be noted, would at the same time have their pensions reduced from the household rate to the single rate once their spouses were in receipt of an individual pension.
40. The scheme adopted by Member State A is so devised that the income of the couple cannot exceed the working spouse' s pension at the household rate (if the other spouse waives his or her own pension) or the working spouse' s pension at the single rate, increased by the other spouse' s own pension. It does not permit aggregation of the working spouse' s pension at the increased rate and the other spouse' s own pension. That scheme is both logical and fair.
° B °
41. In principle, the legislation in Member State A is not discriminatory, nor does it cause migrant workers to lose an entitlement if their spouses are not in work. The difference in the schemes created for them by the two bodies of legislation in question is not, in itself, indicative of any discrimination.
42. What should be compared is the position of migrant workers whose spouses are not in work with that of non-migrant workers whose spouses are also not in work.
43. Ex hypothesi, in both cases the spouses have not worked and cannot receive a work-related pension.
44. In Member State A non-working spouses may not receive a pension based on years of residence, since that State does not recognize that form of pension. In that State the pension of workers who have never availed themselves of freedom of movement will only in exceptional circumstances be reduced to the single rate on account of non-working spouses: the latter may only in exceptional circumstances claim their own pensions in that State. (21)
45. By contrast, in the same State, the reduction of a pension to the single rate will hit migrant workers whose spouses, never having worked, have nevertheless been able to obtain their own pensions in another Member State when the latter ° as is the case in the Netherlands ° awards those who have not worked such a pension based on years of residence.
46. Spouses who have not worked but who are entitled to their own pension, thus reducing the other spouses' pension will, therefore, more often than not be the spouses of migrant workers.
47. For all that, this does not lead automatically to discrimination between (1) workers whose non-working spouses confer on them entitlement to an increased pension (household rate) and (2) those whose spouses receive their own pensions (based on residence), thus causing the pension to be reduced to the single rate in the first State.
48. As we have seen, (22) the final outcome may be the same in the two cases. In the first, where the non-working spouses have no pension of their own, workers receive their pensions at the household rate. In the second, they also receive their pensions at the household rate, but reduced by an amount equal to the individual pensions paid to the non-working spouses in the other Member State. The couples' total income is, on each occasion, at least equal to the working spouses' pensions at the household rate.
49. At first sight, therefore, Member State A attaches the same consequences to the receipt of a pension by non-working spouses, whether that benefit arises under its own law or that of another Member State. Up to that point, its legislation is not discriminatory since it does not deprive migrant workers of advantages enjoyed by non-migrant workers.
II ° Article 48 precludes certain effects produced by the legislation of Member State A when Member State B' s legislation is amended
50. Does the legislation of Member State A become discriminatory "on the border-line", as it were, on account of certain effects it attaches to the legislation of Member State B? That, you will be aware, is the central question in this case.
51. I have answered that question ° and shall continue to answer it ° in the affirmative.
52. To my mind, a discriminatory aspect arises from the extremely specific nature of the situation in which an insured person such as the applicant in the main proceedings finds himself. It is confined to the particular circumstances of such a situation. It is none the less evident, for all that.
53. The question may be put as follows: may that legislation, which allows the working spouses' pension to be maintained at the household rate where they also receive an increased pension (on account of a dependent spouse) in another Member State, (23) refuse to allow that rate to be maintained where, total income remaining unchanged, the increase in that second State is merely replaced by payment of an equal amount to the non-working spouses as an individual pension?
54. The Court will weigh the choices before it.
55. The Court may stress the fact that Member State B' s amendment of its legislation helps to ensure women' s independence, by granting them individual entitlement to pensions. It may then consider that the rights of spouses have been substantially altered and that two different situations are concerned even if, purely accidentally, the former increase and the pension replacing it are of the same amount. The Court might therefore conclude that, once non-working spouses are in receipt of an individual pension, they are not, properly speaking, dependent, and there is, consequently, no discrimination and no obstacle to freedom of movement for workers.
56. On the other hand, the Court may take the view ° and this is the approach that I prefer ° that it is the total income of a couple, one of whom is a migrant worker with a dependent non-working spouse, which should be taken into consideration.
57. It will then find that, in a situation such as that in the present case, the change in the couple' s situation arising from the legislative reform in Member State B is clearly one of form and not of substance: the husband alone has worked, the wife has not, and the couple' s total income in that State has not changed, since the fact that the wife receives now receives in her own right half of the pension previously paid to her husband does not bring about any betterment.
58. The Court will then conclude that Community law precludes the reduction in question.
59. Any other solution would disadvantage migrant workers in relation to non-migrant workers in Member State A who also have dependent spouses but who are not threatened with a reduction in pension. Such solution would constitute discrimination and, therefore, an obstacle to freedom of movement for workers.
60. If there is one area in which substance must prevail over form and reality over appearances, it is freedom of movement for workers, having regard in particular to the rights that have accrued to them at the end of their working life.
61. With respect to the second question, I refer to my previous Opinion. (24)
62. For those reasons I firmly adhere to the position I adopted in my first Opinion and propose that the Court rule as follows:
1. Article 4(1) of Council Directive 79/7/EEC of 19 December 1978 on the progressive implementation of the principle of equal treatment for men and women in matters of social security, read in conjunction with Article 7(1)(c) of that directive, must be interpreted as meaning that it does not preclude national legislation attaching different consequences to the award of pension benefits related to the situation of the non-working spouse according to whether the benefit is granted in the form of an increase in the pension of the active spouse or in the form of a separate pension granted to the non-working spouse.
2. Articles 3(c) and 48 of the EEC Treaty preclude national legislation, where it is not justified on grounds of public policy, public safety or public health, from having the effect of depriving migrant workers whose non-working spouses remain dependent on them of their household rate pension in one Member State because a pension is paid directly to those spouses in another Member State, when, without any increase arising in the couple' s total income, the spouses' pension merely replaces the increase in pension formerly awarded in the second State to workers in respect of non-working dependent spouses.
(*) Original language: French.
(1) ° Paragraphs 17 and 18, and paragraph 1 of the conclusion.
(2) ° See the first question referred by the national court.
(3) ° Judgment in Case C-227/89 Roenfeldt v Bundesversicherungsanstsalt fuer Angestellte [1991] ECR I-323, paragraph 12.
(4) ° See the judgment in Case 22/77 FNROM v Mura [1977] ECR 1699, paragraph 10.
(5) ° See Willms, B.: Artikel 51, paragraph 35, in Kommentar zum EWG-Vertrag, Groben, Thiesing, Ehlermann, 4th edition, p. 870.
(6) ° See the Commission' s written replies to the questions put by the Court, dated 11 March 1994.
(7) ° See, in particular, the judgment in Case 368/87 Hartmann Troiani v Landesversicherungsanstalt [1989] ECR 1333, paragraph 21.
(8) ° Paragraphs 18 and 19 of the judgment in Case C-10/90 Masgio [1991] ECR I-1119, emphasis added. See the decisions cited in that judgment.
(9) ° On this point, see the very general formulation in the judgment in Case C-19/92 Kraus [1993] ECR I-1663: Articles 48 and 52 preclude any national measure concerning the conditions of use of a further university diploma acquired in another Member State, which, even though applicable without discrimination on grounds of nationality, is liable to hinder or make less attractive the exercise by Communtiy nationals, including those of the Member State adopting the measure, of the fundamental freedoms guaranteed by the Treaty (paragraph 32, emphasis added).
(10) ° See, to that effect, paragraph 4.5 in the replies of the United Kingdom to the Court' s questions.
(11) ° Cited above, note 7.
(12) ° Paragraph 23, emphasis added.
(13) ° Paragraphs 47 and 48.
(14) ° On that point, see Paragraph 6.6 of the answers to the Court' s questions submitted by the United Kingdom and p. 21 of the French translation of the observations submitted by the defendant in the main proceedings.
(15) ° Article 10(4) of Royal Decree No 50.
(16) ° Ibid.
(17) ° Article 10(1)(b) of Royal Decree No 50.
(18) ° See, to this effect, the defendant' s observations, p. 8 and 9, and the answers to the Court' s questions submitted by the United Kingdom, paragraph 2.7. See also the observations of the Commission, at paragraph 1.3.
(19) ° The last subparagraph of Article 10(4) of Royal Decree No 50.
(20) ° See the observations of the Commission, I.4, the defendant, II.A and C, and the latter' s answers to the Court' s questions, p. 2. See also the answers to the Court' s questions submitted by the United Kingdom.
(21) ° In Belgium non-working spouses may receive neither an individual pension on the basis of years of employment (precisely because they have not worked) nor an individual pension on the basis of years of residence. They may however receive an individual pension or equivalent benefit on other grounds. See Article 10(1)(a) of Royal Decree No 50.
(22) ° See above, paragraphs 33 and 34.
(23) ° Such was the case under the domestic Netherlands legislation before it was amended on 1 April 1985.
(24) ° Paragraphs 54 and 55.