Opinion of Mr Advocate General Ruiz-Jarabo Colomer delivered on 16 November 1999. - Commission of the European Communities v Italian Republic. - Failure of a Member State to fulfil its obligations - Right of residence - Directives 90/364/EEC, 90/365/EEC and 93/96/EEC - Conditions as to resources. - Case C-424/98.



European Court reports 2000 Page I-04001



Opinion of the Advocate-General

1 The Commission has brought an action before the Court of Justice for a declaration that the Italian Republic has failed to fulfil its obligations. To be specific, the Commission alleges that the Member State exceeded its authority when it came to transpose into its national law Directive 90/364/EEC on the right of residence (1) (hereinafter `Directive 90/364'), Directive 90/365/EEC (2) on the right of residence for workers who have ceased their occupational activity (hereinafter `Directive 90/365') and Directive 93/96/EEC on the right of residence for students (3) (hereinafter `Directive 93/96').

2 Directive 90/364 and Directive 90/365, and also Directive 90/366/EEC on the right of residence for students (4) (hereinafter `Directive 90/366'), were adopted by the Council in order to extend to all Community nationals the right to reside in a Member State other than their own, provided that they did not become a burden on the public finances of the host State. The period prescribed for the Member States to transpose these rules into their national law expired on 30 June 1992.

3 Directive 90/366 was annulled by the Court of Justice because it had been adopted by the Council on an improper legal basis. (5) However, in its judgment the Court decided that it was appropriate to maintain for the time being all the effects of the annulled directive until such time as the Council replaced it with a new directive adopted on the proper legal basis. The new directive was adopted on 29 October 1993 and the period prescribed for the Member States to adjust their national law expired on 31 December that year.

4 The three 1990 Directives were transposed into Italian law by Legislative Decree No 470 of 26 November 1992 concerning the implementation of Directives 90/364, 90/365 and 90/366 on the right of residence for Community nationals, for employees and self-employed persons who have ceased their occupational activity, and for students. (6)

In its application the Commission points out that the Decree was adopted before Directive 93/96 was published. However, as the provisions of this directive are almost identical to those of Directive 90/366, it takes for granted that the Italian Government believes that its national legislation is also consistent with Directive 93/96. Nevertheless, the Commission is of the opinion that the Italian Government has transposed those directives into its national law incorrectly in several respects.

I - The pre-litigation procedure

5 In accordance with the provisions of Article 169 of the EC Treaty (now Article 226 EC) the Commission put its point of view to the Italian authorities in a letter it sent to them on 13 June 1995 inviting them to submit their observations within two months.

6 The Italian Government replied through its Permanent Representation, on 6 December 1995, with two notes from the Ministry of Labour and Social Security, prepared by the Department of Social Security and Welfare and by the Department of Employment. After examining the notes, the Commission considered that the reply was inadequate and, on 11 November 1996, sent a reasoned opinion to the Italian Republic.

7 Italy's Permanent Representation informed the Commission, in a letter dated 13 December 1996, that Article 1(6) of the draft law entitled `Provisions for fulfilling Italy's obligations as a member of the European Communities - Community Law 1995-1996' which had been approved by the Council of Ministers at a meeting held on 8 November 1996, gave the Government responsibility for adopting the additional provisions needed to ensure that Legislative Decree No 470 complied with Directives 90/364, 90/365 and 93/96.

II - Proceedings before the Court of Justice

8 As the Commission received no subsequent information about the stage reached in the adoption of those rules, nor any text making the appropriate amendments to the national law, it concluded that the Italian Republic had not adopted the necessary provisions for correctly transposing the three directives into national law and that, if it had done so, it had not communicated the text to the Commission, as it was under a duty to do. It therefore brought an action before the Court of Justice on 25 November 1998 for a declaration that that Member State had failed to fulfil its obligations.

9 The Italian Republic filed its defence to the application on 25 March 1999. The Commission waived its right to supplement its application by a reply. In accordance with the provisions of Article 44a of its Rules of Procedure, the Court, with the express consent of the parties, decided that the proceedings could continue without the need for a hearing.

III - Analysis of the Commission's pleas in law

10 The Commission states, to begin with, that the Italian Republic has a duty, under Article 5 of Directive 90/364 and Article 5 of Directive 90/365, to adjust its national law to their provisions, and that Directive 93/96 must also be correctly transposed into Italian law. These obligations arise under Article 189(3) of the EC Treaty (now Article 249(3) EC) which provides that a directive is binding, as to the result to be achieved, upon each Member State to which it is addressed, and under Article 5(1) of the EC Treaty (now Article 10(1) EC) which provides that the Member States are to take all appropriate measures, whether general or particular, to ensure fulfilment of the obligations arising out of this Treaty or resulting from action taken by the institutions of the Community.

11 The Commission puts forward three pleas in support of its action for failure to fulfil obligations, because it considers that there are three areas in which Italian law is not compatible with the provisions of the Directives which recognise the right of residence for Community nationals in the territory of the Member States. These three pleas, which I shall analyse separately, relate to the resources of the members of the family of the beneficiaries of Directive 90/364, to the documents which have to be submitted by the beneficiaries of Directives 90/364 and 90/365, and to the resources of students and the members of their family, and the proof of it.

A. The first plea: the condition relating to the financial means of the members of family of the beneficiaries of Directive 90/364

12 The Commission points out that Legislative Decree No 470, which amended Presidential Decree No 1656 of 1965, added Article 5a on the right of residence for nationals of a Member State who have carried on an occupational activity (Directive 90/365) and Article 5c on the right of residence for nationals of Member States who do not enjoy this right under other provisions of Community law (Directive 90/364). To enjoy the right, the beneficiaries of both directives must have an income which is not lower than the minimum salary laid down by the Italian compulsory general social security insurance scheme.

Family members who are dependent on a beneficiary of Directive 90/365 are granted the right of residence if the beneficiary can prove that he has, for each of them, an income of not less than that minimum salary. On the other hand, the right of residence for family members of a beneficiary of Directive 90/364 is conditional on his having, for each of them, an income equivalent to that minimum salary plus one third of the amount again. (7) The result is that, as far the right of residence for family members is concerned, the beneficiaries of Directive 90/364 are required to have resources one third higher than those which the beneficiaries of Directive 90/365 must have.

13 With regard to this plea, the Italian Republic states in its defence that there is a draft law whose provisions are intended to amend the rules criticised by the Commission. It claims that this draft law has reached an advanced stage in the process of interministerial consultation.

14 Article 1(1) of Directive 90/364 on the right of residence for nationals of Member States who do not enjoy this right under other provisions of Community law, and Article 1(1) of Directive 90/365 on the right of residence for workers who have ceased their occupational activity, regulate the conditions which beneficiaries must satisfy in order to obtain a residence permit in any of the Member States.

On the one hand, they must all have, for themselves and for the members of their family, health insurance to cover all risks in the host Member State. However, the beneficiaries of Directive 90/364 must have some income, whereas the beneficiaries of Directive 90/365 must be in receipt of an invalidity or early retirement pension, or old age benefit or a pension in respect of an industrial accident or disease. Both the income, in the first situation, and the pension or benefit in the second, must be of an amount sufficient to prevent them becoming a burden on the social security system of the host State during their period of residence.

15 The two directives agree that the resources shall be considered sufficient where they are higher than the level of resources below which the host Member State may grant social assistance to its nationals, taking into account the personal circumstances of the applicant and, if appropriate, those of the members of his family. In any event, the resources of the applicant shall be considered sufficient if they are higher than the level of the minimum social security pension paid by the host Member State.

As the Commission quite rightly points out in its application, the condition relating to financial means is formulated in identical terms in the two directives and beneficiaries are only required to have sufficient income to prevent them becoming a burden on the social assistance scheme. The minimum level of income, as well as being common to both directives, is clearly specified and neither provides for any exception to be applied to the family members of its beneficiaries.

16 I think that the Commission is right to state that Italy should have imposed the same conditions regarding income in respect of the family members of the beneficiaries of the two directives. Accordingly, by keeping in force a law which requires family members of beneficiaries of Directive 90/364 to have resources one third greater than family members of beneficiaries of Directive 90/365, Italy has failed to fulfil its obligations under Directive 90/364.

17 For the reasons I have given, I think that the Commission's first plea is well founded.

B. The second plea: the condition relating to the documents which must be submitted by the beneficiaries of Directive 90/364 and 90/365

18 Article 5d, which was added to Presidential Decree No 1656 by Legislative Decree No 470, regulates the documents which must be submitted by the beneficiaries of Directives 90/364 and 90/365. To be issued with a residence card an applicant must submit, amongst other documents, a consular certificate confirming that he is registered with the public health service of a Member State, a sickness insurance policy covering medical treatment and hospitalisation in Italy, or a certified copy of his Italian public health service certificate. A beneficiary of Directive 90/365 is required to submit a consular certificate confirming that he is in receipt of a pension or benefit or other income, and indicating the amount, whereas a beneficiary of Directive 90/364 and members of his family who are dependent on him are required to submit a copy, certified by the Consulate, of the documents issued in the State of origin or provenance which show that the required income exists and, if such income is obtained in Italy, the supporting documents issued by the competent authorities.

Furthermore, and in general, for those family members who are dependent on him, the person who has the right of residence must submit an official document issued by the competent authority of the Member State of origin or provenance confirming that they are members of his family and dependent on him.

19 The Commission believes that, in some cases, in order to avoid the use of false documents, the refusal to accept documents which have not been issued by a public authority may be justified. However, the obligation which Italian law imposes on the beneficiaries of Directives 90/364 and 90/365 to submit, in every case, documents issued by the public authorities of one Member State or the other, is clearly out of proportion. It adds that, in certain circumstances, it can be very difficult for the beneficiaries of the Directives to obtain those precise documents and that the Italian authorities could ascertain, by other, equally valid means, that the applicants satisfy the conditions necessary to be granted the right of residence.

20 The Italian Republic states, in its defence, that, if the person applying for the residence permit is a worker who has ceased his occupational activity, he will be in receipt of a pension or benefit or other equivalent income. The bilateral double taxation agreements concluded between Italy and the other States in the Union provide that pensions received by persons formally employed in the private sector are subject to tax in the State in which the taxpayer resides and the State which pays them must not, in principle, deduct tax. Therefore, the organisation which pays the pension or benefit in the State of origin or provenance will, without great difficulty, be able to issue a certificate confirming the amount of the income received by the person in question.

Furthermore, Member States which do not levy income tax on pensions may supply the tax authorities of the State of residence with details of the income obtained by way of pension or benefit in their territory, by an automatic exchange of information regulated by Directive 77/799/CEE (8) (hereinafter `Directive 77/799'). The Italian Republic adds that it has signed administrative agreements intended to facilitate the spontaneous exchange of information with seven of the States in the Union. It concludes that it does not share the doubt expressed by the Commission as to whether or not there is, in the other Member States, a public authority which can certify, in such circumstances, the amount of taxable income received by the person applying for a residence permit.

It ends its defense to the application by pointing out, in relation to the documents accepted to prove relationship or dependency, that Decree No 403 of the President of the Republic was published on 24 November 1998 in the Official Journal of the Italian Republic (GURI No 275); Article 5 of the Decree simplifies the rules governing administrative documents and confers the same treatment on Union nationals as on Italian nationals.

21 I note that both Directive 90/364 and Directive 90/365 provide that, for the purpose of issuing the residence permit, the Member State may only require that the applicant present a valid identity card or passport and provide proof that he meets the necessary conditions, that is, that he has an income which is considered sufficient within the meaning of the Directives and that he has, for himself and for the members of his family, health insurance covering all risks in the host Member State.

22 It is clear that neither of the directives deals with the way in which persons applying for a residence permit must prove that they satisfy the conditions; therefore the Member States have a degree of discretion in asking for evidence that the conditions are met.

However, when regulating this matter, they must take into account the wide variety of legal systems which coexist in the Union and the great many different situations which may arise in practice and, above all, make use of the advantages offered by other provisions of Community law available to them, such as - as well as the communication channels established by Directive 77/799, to which Italy has referred - the opportunities presented by Regulations (EEC) No 1408/71 and 574/72, (9) when it comes to providing evidence, by means of certificates issued by the national social security institutions at the request of the applicants, of the welfare cover provided by a specific social security scheme and the amounts of the pensions and benefits they pay out.

I should like to add that the laws of the Member States must have enough flexibility not to frustrate the main and ultimate objective of Directives 90/364 and 90/365, which is the abolition, as between Member States, of obstacles to freedom of movement for persons, so that the exercise of the right of residence for Union nationals and the members of their family in any of the Member States becomes a real possibility.

23 In the light of that objective I share the opinion of the Commission that the Italian Republic has exceeded its authority in the exercise of its discretion by requiring that all the documents to be submitted by persons applying for residence permits in Italy and to whom Directive 90/364 and Directive 90/365 apply, are issued by public authorities and certified by consular authorities, without agreeing to the submission of evidence which the applicant could obtain with less difficulty Italy's assertion that, since the end of 1998, for the purposes of proving relationship or dependency, it has applied the same treatment to Union nationals as to Italian nationals, cannot be accepted, because it has adduced no evidence of this and because there is no record that the Commission has been informed of that amendment.

24 For the reasons given, I think that the second plea of the Commission's application is also well-founded.

C. The third plea: the condition relating to the income of students and members of their family and the proof of it (Directive 93/96)

25 Article 5b, which was added to Presidential Decree No 1656 by Legislative Decree No 470, recognises the right of residence in Italian territory for students who are nationals of a Member State and have an income of not less than the minimum amount under the Italian compulsory social security scheme. The members of his family are acknowledged to enjoy the same right provided that the student has an overall income, for each of them, of that minimum amount.

In order to be granted a residence permit, the student is required to make an ad hoc declaration, stating the amount of his income, before the competent public authority, or to submit copies of evidential documents issued by the authorities of another Member State and certified by the consular authorities. For family members who are his dependents, he must present copies of documents, issued in the State of origin or provenance and certified by the consular authorities, confirming the existence of the income or, in the case of income obtained in Italy, copies of documents issued by the relevant institutions.

26 However, Article 1 of Directive 93/96 provides as follows: `[I]n order to lay down conditions to facilitate the exercise of the right of residence and with a view to guaranteeing access to vocational training in a non-discriminatory manner for a national of a Member State who has been accepted to attend a vocational training course in another Member State, the Member States shall recognise the right of residence for any student who is a national of a Member State and who does not enjoy that right under other provisions of Community law, and for the student's spouse and their dependent children, where the student assures the relevant national authority, by means of a declaration or by such alternative means as the student may choose that are at least equivalent, that he has sufficient resources to avoid becoming a burden on the social assistance system of the host Member State during their period of residence, provided that the student is enrolled in a recognised educational establishment for the principal purpose of following a vocational training course there and that he is covered by sickness insurance in respect of all risks in the host Member State.'

27 I notice that in this text, in order to obtain a residence permit, the beneficiaries of Directive 93/96 , unlike the beneficiaries of Directives 90/364 and 90/365, are not required to have sufficient resources, nor to be in receipt of a minimum income, nor to provide documentary evidence of their means.

28 There are several reasons for the differences between Directive 93/96 and the other two. Firstly, in the great majority of cases a student's period of residence is limited to the duration of his studies and there is, therefore, less danger that he will become dependent on the social assistance system of the host State. Secondly, Member States may limit the validity of a residence permit to one year, renewable annually, so that they have greater capacity to intervene in the event that the applicant becomes dependent on the social assistance system. Thirdly, if a student is short of money, he is better placed than the beneficiaries of the other Directives to supplement his income by doing small temporary or part-time jobs, even though it may be impossible to prove, in advance, that he will find himself in that position.

I also note that Directive 93/96 substantially reduces the number of family members to whom the right of residence may extend. In fact, whereas the family members entitled to settle with a beneficiary of Directives 90/364 and 90/365 in the territory of the Member State include the spouse and dependent children and any dependent ascendant relatives of the person entitled to right of residence and of his spouse, only a spouse and dependent children may settle with a student.

Furthermore, Directive 93/96 does not lay down any requirement regarding the amount of income which the student must have in respect of his spouse and dependent children or consider the possibility that a student may have to present any documents as evidence of the availability of funds, leaving it up to him to choose whether to guarantee that availability by means of a declaration or by any alternative means that are at least equivalent.

29 For the reasons I have explained, I agree with the Commission that, by requiring students who are nationals of other Member States to guarantee to the Italian authorities that they have financial resources of a certain level for themselves, their spouse and dependent children, by not establishing clearly that it is enough for the student to declare that he has financial resources and that he does not have to submit documentary proof, and by not allowing the student to guarantee, by making a declaration, that he has sufficient resources to avoid his spouse and dependent children becoming a burden on the social assistance system, the Italian Republic has failed to fulfil its obligations under Directive 93/96.

30 The third plea of the application, to which the Italian Republic has offered no defence, is, therefore, also well founded.

IV - Costs

31 As the pleas put forward by the Commission have been upheld, the Italian Republic should be ordered to pay the costs of the proceedings, in accordance with the first subparagraph of Article 69(2) of the Rules of Procedure.

V - Conclusion

32 In view of the foregoing considerations, I propose that the Court of Justice should:

(1) declare that the Italian Republic has failed to fulfil its obligations under the EC Treaty and Council Directive 90/364/EEC of 28 June 1990 on the right of residence, Council Directive 90/365/EEC of 28 June 1990 on the right of residence for employees and self-employed persons who have ceased their occupational activity and Council Directive 93/96/EEC of 29 October 1993 on the right of residence for students:

- by imposing on the beneficiaries of Directive 90/364 the obligation to have, for the members of their family, resources one third higher in amount than the resources which the beneficiaries of Directive 90/365 are required to have for the members of their family;

- by limiting the methods of proof which may be submitted with the application for the residence permit and providing that documents must be issued or certified by the authorities of another Member State, and

- by requiring students who are nationals of other Member States to guarantee to the Italian authorities that they have resources of a certain level for themselves, their spouse and dependent children, by not establishing clearly that it is enough for the student to declare that he has financial resources and that he does not have to submit documentary proof, and by not allowing the student to guarantee, by making a declaration, that he has sufficient resources to avoid his spouse and dependent children becoming a burden on the social assistance system.

(2) order the Italian Republic to pay the costs.

(1) - Council Directive 90/364/EEC of 28 June 1990 (OJ 1990 L 180, p. 26).

(2) - Council Directive 90/365/EEC of 28 June 1990 on the right of residence for employees and self-employed persons who have ceased their occupational activity (OJ 1990 L 180, p. 28).

(3) - Council Directive 93/96/EEC of 29 October 1993 (OJ 1993 L 317, p. 59).

(4) - Council Directive 90/366/EEC of 28 June 1990 (OJ 1993 L 180, p. 30).

(5) - Judgment in Case C-295/90 Parliament v Council [1992] ECR I-4193.

(6) - GURI No 286, 4 December 1992.

(7) - I infer from paragraphs 10 and 12 of the application that this is what the Commission means to say in paragraph 11, where it says exactly the opposite.

(8) - Council Directive 77/799 of 19 December 1977 concerning mutual assistance by the competent authorities of the Member States in the field of direct taxation (OJ 1977 L 336, p. 15).

(9) - See how these are worded in Council Regulation (EC) No 118/97 of 2 December 1996 amending and updating Regulation (EEC) No 1408/71 on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community, and Regulation (EEC) No 574/72 laying down the procedure for implementing Regulation (EEC) No 1408/71 (OJ 1997 L 28, pp. 1 and 102 respectively).