1.

The cases on which I deliver my opinion today concern the conditions for the repayment of building loans made by the Commission to Community officials and, more particularly, the effects produced on the system of repayments by Council Regulations Nos 3085 and 3086/78 of 21 December 1978. It should be recalled that, by decision of 2 March 1970 concerning the use of the available sums entered in the budget of the ECSC under the head “Pension Funds”, the Council inter alia reserved 40% of those sums for making loans within the framework of a housing policy for the benefit of officials. On that basis the Commission adopted on 17 June 1971 implementing provisions which were published in Staff Courier No 170 A of 8 July 1971. The provision with which this case is principally concerned is Article 9 which deals with the currency aspects of the payment of the sums paid. In the original version of the provision it was stated that: “Loans covered by this provision shall be expressed in Belgian francs. The corresponding payments shall be made in the currency of the country where the property being financed is located, at the parity at the time of payment.” By a decision of 25 July 1975 the Commission amended the first part of that provision, providing that the loans should not only be expressed but should also be “paid in Belgian francs” and substituted for the second part a provision that: “The deductions and payments referred to in Article 7 (2) shall be made in Belgian francs, as shall any repayment made by the borrower to the Commission.” It must be borne in mind that Article 7 (2) provided inter alia that the loan agreements were required to confer upon the Commission power to deduct... from the salary or other emoluments of the official... the interest and repayments due. The same decision of the Commission of 25 July 1975 also provided in Article 2 (a) that a borrower who had received the amount of the loan in the currency of the country in which the building was situated at a rate other than the average rate of exchange for such currency on the Brussels market on the day of payment might claim a reduction in the capital sum owing in so far as he had suffered financial loss through the fact that repayment was effected in Belgian francs. Paragraph (b) of the same article defined the criteria in accordance with which the new (reduced) amount of the capital debt was to be determined and paragraph (c) stated that, in accordance with the new version of Article 9, all repayments to be made after the decision reducing the debt were to be effected in Belgian francs. The new arrangements regarding currency which were introduced through the amendment of Article 9 were not immediately put into force in their entirety. Initially the Commission merely made provision for cases of reduction for the loan capital without altering the amount of the deductions for the repayment. In 1977 the staff was informed (through a circular published in Administrative Notice No 134 of the Commission of 24 January 1977) that the calculation of deductions from salaries for the repayment of the debt would be “based on ‘updated’ exchange rates”; however, staff were still permitted to have the parities communicated to the International Monetary Fund applied “with reference to and within the scope of the provisions giving effect to Article 17 of Annex VII to the Staff Regulations”. In this way it remained possible to enjoy the original rates up to 1 April 1979, that is until the date on which the said Regulations Nos 3085 and 3086/78 came into force. With regard to the content of those regulations I have had occasion to deal with them fully in my opinion of 14 May 1981 in Case 153/79 Bowden and Others [1981] ECR 1512. Now I need only recall that Regulation No 3085/78 amended the provisions of the Staff Regulations of Officials with reference to the monetary parities to be used in the application of the Staff Regulations, terminating the application of the parities of the International Monetary Fund and introducing, as the basis for calculating remuneration paid in currencies other than Belgian francs, the exchange rates used for the implementation of the general budget of the Community on 1 July 1978. With regard to Regulation No 3086/78, it makes provision for the adjustment of the weightings applicable to the remuneration and pensions of Community officials in order to bring their level into line with the new monetary parities. In fact we know that the maintenance of the old parities of the International Monetary Fund was accompanied by an anomalous use of the weightings in order to counter the imbalance between those parities, which went back to 1965, and the actual relationships which developed between the currencies following a more rapid rate of depreciation in certain European countries than in others. Accordingly, once a system of realistic parities had been reintroduced the weightings applicable to those countries had to be reduced in order that they might resume their original purpose of compensating for the differing levels in the cost of living. Regulations Nos 3085 and 3086/78 have adversely affected officials with a place of employment in Member States with weak currency who receive payment in such currency and who have obtained building loans. I have already stated that until 1 April 1979 the repayments by instalments of such loans, which were effected by deductions from salary, were made on the basis of the 1965 rates of exchange. After 1 April 1979 the deductions in question were effected on the basis of the updated rates of exchange; the deductions have thus become much more burdensome. In order to provide a clear picture of the change the example may be taken of an official who, like the applicants, was employed in Italy and had obtained in 1972 a building loan of BFR 500000. At that time the equivalent sum in Italian lire was paid him at the International Monetary Fund rate of LIT 12.50 per Belgian franc (and he accordingly received LIT 6250000) and the monthly deductions for the repayment of the loan were initially calculated on the basis of the remuneration (expressed in Belgian francs) increased by the weighting for Italy which was more than 100 in order to compensate for the artificial rate of exchange; furthermore, each deduction removed from the salary in Italian lire a sum calculated at the rate of LIT 12.50. When Regulations Nos 3085 and 3086/78 came into force the deductions were made from remuneration in Belgian francs reduced through the application of the Italian weighting (which fell to a level below 100 after the reestablishment of genuine rates of exchange) and caused a considerable reduction in the level of remuneration expressed in Italian lire in view of the fact that the rate of exchange of the Belgian franc and the Italian lira is approximately double what it was.