Opinion of Mr Advocate General Jacobs delivered on 9 June 1994. - Piera Scaramuzza v Commission of the European Communities. - Appeal - Official - Service in a non-member country - Remuneration - Payment in the currency of the country of employment. - Case C-76/93 P.



European Court reports 1994 Page I-05173



Opinion of the Advocate-General

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My Lords,

1. Mrs Piera Scaramuzza is an official of the Commission in grade B3. For some years now she has served the Commission in non-member States. On 4 January 1988 she was posted to the Commission' s Delegation in Oslo and was subsequently transferred to the Commission' s office in New York as from 17 June 1991.

2. The salary regime applicable to Mrs Scaramuzza, as an official serving in a non-member State, is to be found in Annex X to the Staff Regulations of Officials of the European Communities. Annex X was added to the Staff Regulations by Council Regulation (Euratom, ECSC, EEC) No 3019/87 of 5 October 1987. (1) Annex X is entitled "Special and exceptional provisions applicable to officials serving in a third country". Article 11 of Annex X provides:

"Remuneration, as also the allowances referred to in Article 10, shall be paid in Belgian francs in Belgium. They shall be subject to the weighting applicable to the remuneration of officials employed in Belgium."

Article 12 of Annex X provides:

"At the request of the official, the appointing authority may decide to pay all or part of his remuneration in the currency of the country of employment. In that event, it shall be subject to the weighting for the place of employment and shall be converted on the basis of the corresponding exchange rate.

In duly substantiated exceptional cases, the appointing authority may make all or part of this payment in a currency other than that of the country of employment in such a way as to maintain purchasing power."

The Commission adopted Internal Directives implementing Article 12 of Annex X. Article 1 of the Internal Directives provides:

"In pursuance of Article 12 of Annex X to the Staff Regulations and at the request of the official, the appointing authority shall pay in the currency of the place of employment a part of his remuneration up to 80% of his net remuneration. In duly reasoned cases the appointing authority may agree to pay in the currency of the country of employment a part of the remuneration exceeding 80%."

3. On 1 October 1990 Mrs Scaramuzza asked for the whole of her salary to be paid in the currency of the place of employment with application of the corresponding weighting, with retroactive effect from the date when she was posted to Oslo. That request was rejected by the Director-General of Personnel and Administration in a letter of 12 February 1991.

4. She lodged a complaint against that decision which was explicitly rejected by the Commission in a decision adopted on 26 July 1991. Mrs Scaramuzza challenged that decision before the Court of First Instance. Her application was dismissed in a judgment dated 15 December 1992. (2) She has now appealed against that judgment to the Court of Justice.

5. Before the Court of First Instance Mrs Scaramuzza put forward two submissions. The first was that Article 1 of the Internal Directives was contrary to Article 12 of Annex X, which did not limit the proportion of an official' s salary that could be paid in the local currency and did not confer any discretion on the appointing authority. That submission was rejected by the Court of First Instance, which held that Article 12 of Annex X, and in particular the words "may decide", combined with the expression "at the request of the official", conferred a margin of discretion on the appointing authority. By adopting internal directives imposing a limit of 80% on the portion of the salary to be automatically payable in the currency of the country of employment the Commission did not exceed the limits of its discretionary power. In fact it was still possible for an official to receive 100% of his salary in the currency of the country of employment if his request was properly substantiated.

6. Mrs Scaramuzza' s second submission was based on the alleged breach of the principle, laid down in Articles 64 and 65 of the Staff Regulations, according to which the purchasing power of an official' s salary should not vary depending on his place of employment. She also argued that the Commission' s practice was effectively depriving her of part of her salary. Furthermore, if she were required, in accordance with Article 1 of the Internal Directives, to furnish proof as to the way in which she spent her salary, that would constitute an intrusion into her private life which would be contrary to Article 12 of the Universal Declaration of Human Rights.

7. The Court of First Instance dismissed those arguments for reasons that are summarized below (in paragraphs 17 and 18).

Admissibility

8. In her appeal Mrs Scaramuzza relies on a "single submission" based (a) on the infringement of the general principle of law ° enshrined in Article 62 of the Staff Regulations ° to the effect that a worker is entitled to dispose of his salary as he pleases and (b) on the infringement of the general principle of law to the effect that the individual' s privacy must be respected, a principle enshrined in Article 8 of the European Convention on Human Rights and in Article 12 of the Universal Declaration of Human Rights.

9. The Commission contends that the appellant' s single submission amounts in substance to two distinct submissions: one based on her right freely to dispose of her salary and the other based on the alleged breach of the fundamental right to privacy. According to the Commission, neither of those submissions was raised in the proceedings before the Court of First Instance and they are therefore both inadmissible under Article 113(2) of the Rules of Procedure, which states that "The subject-matter of the proceedings before the Court of First Instance may not be changed in the appeal".

10. As regards the first submission, the Commission contends that before the Court of First Instance Mrs Scaramuzza argued that the Commission had deprived her of part of her remuneration, whereas in her appeal she argues that the Commission, by means of the presumption established in Article 1 of the Internal Directives, is limiting her freedom to spend the whole of her remuneration at her place of employment. As regards the second submission, the Commission states that the alleged breach of the general principle of respect for privacy was invoked for the first time in Mrs Scaramuzza' s reply in the proceedings before the Court of First Instance and that Article 8 of the European Convention on Human Rights was not invoked at all before the Court of First Instance.

11. In my view, the Commission' s arguments on admissibility cannot be upheld. As regards the first point, the difference between the argument pursued by Mrs Scaramuzza on appeal and the argument pursued at first instance is not as great as it might appear. Her argument that she is being prevented from spending her salary as and where she chooses should not be taken literally. Presumably she is free to do as she pleases with the 20% of her remuneration that is paid in Belgian francs. She may, for example, have it transferred to Norway or to any other country (subject to the applicable rules on exchange control). She may, however, find that it is not worth her while to do so because the 20% will be subject to the weighting for Belgium, rather than the higher weighting for Norway, with the result that upon transfer to Norway its purchasing power will be diminished. Thus the gist of her argument is once again that she is being deprived of part of the remuneration that would be due to her if the relevant provisions were properly applied.

12. As regards the alleged breach of the fundamental right to privacy, it is sufficient to note that in paragraph 27 of the judgment appealed against the Court of First Instance referred to Mrs Scaramuzza' s argument to the effect that her privacy would be violated, contrary to Article 12 of the Universal Declaration of Human Rights, if she were required to furnish proof about the nature and structure of her expenditure. It is true that Mrs Scaramuzza did not expressly invoke Article 8 of the European Convention on Human Rights before the Court of First Instance. However, that provision and Article 12 of the Universal Declaration of Human Rights are broadly similar in content. Since one of the provisions was pleaded before the Court of First Instance and the fundamental right to privacy was raised, it is legitimate to regard the reference to the other provision in the appeal as simply a development of an issue that was raised at first instance.

Substance

13. Article 62 of the Staff Regulations provides that "an official who is duly appointed shall be entitled to the remuneration carried by his grade and step". The first paragraph of Article 63 provides that:

"Officials' remuneration shall be expressed in Belgian francs. It shall be paid in the currency of the country in which the official performs his duties."

The first paragraph of Article 64 provides that:

"An official' s remuneration expressed in Belgian francs shall, after the compulsory deductions set out in these Staff Regulations or in any implementing regulations that have been made, be weighted at a rate above, below or equal to 100%, depending on living conditions in the various places of employment."

Article 65 of the Staff Regulations requires the Council to carry out an annual review of the level of remuneration of officials and other servants.

14. The Court has consistently held that the purpose of Articles 64 and 65 is to ensure that all officials of the same grade and step have equivalent purchasing power, wherever their place of employment, in accordance with the principle of equality of treatment. (3)

15. The "special and exceptional provisions" of Annex X to the Staff Regulations derogate from Articles 63 and 64 as regards officials employed in non-member States. The effect of those provisions, in conjunction with the Commission' s Internal Directives, is that the appointing authority pays up to 80% of the official' s remuneration in the currency of the country of employment (applying the weighting for that country), if the official so requests, and that it may pay a greater portion of the official' s remuneration in the currency of the country of employment (with the appropriate weighting) only if the official states adequate reasons for receiving more than 80% of his remuneration in that currency. Any part of the official' s remuneration not paid in the currency of the country of employment is paid in Belgian francs and is subject to the weighting for Belgium.

16. Thus the difference in treatment suffered by Mrs Scaramuzza, in comparison with an official employed in a Member State, relates only to 20% of her remuneration. In order to obtain that part of her remuneration in the currency of the country of employment, with the weighting applicable for that country, she must state special reasons demonstrating, presumably, that she needs to spend more than 80% of her salary in the country of employment. Her argument that she is being deprived of part of her salary would only be valid if there were no objective justification for treating her differently from an official employed in a Member State as regards 20% of her remuneration.

17. The Court of First Instance held, after dealing exhaustively with the issue in paragraphs 32 to 56 of its judgment, that there was objective justification for the difference in treatment described above. The Court observed that the relevant rules were founded on presumptions that officials employed in a Member State were likely to spend their whole salary in the country of employment but that officials employed in non-member States were likely to spend no more than 80% of their salary in the country of employment. Those presumptions were justified, in particular because officials in the latter category were provided with free accommodation and were able to obtain the reimbursement of all their medical expenses, whereas officials employed in a Member State had to pay for their own accommodation and had to bear 20% of their medical expenses (see paragraph 46 of the judgment appealed against).

18. The Court held that it was reasonable to fix at 20% the portion of remuneration which an official employed in a non-member State was unlikely to spend at his place of employment. The Court noted that before the entry into force of Annex X to the Staff Regulations officials employed in non-member States were required to pay 15 to 20% of their remuneration to their institution as a contribution to the cost of the accommodation provided for them by the institution. Moreover, the figure of 20% corresponded to the importance given to the cost of accommodation for the purpose of calculating the weightings for a particular place (paragraph 48).

19. I fully concur with the reasons given by the Court of First Instance for holding that there was objective justification for the different treatment of officials depending on whether or not they serve in a Member State.

20. Mrs Scaramuzza, in her appeal, does not point to any specific defect in the reasoning of the judgment of the Court of First Instance. She considers that, by upholding the Commission' s practice based on Article 1 of the Internal Directives, the Court of First Instance approved a flagrant breach of the general principle of law according to which the official is allowed to spend his salary as he pleases, a breach which the Commission is only willing to repair by means of a procedure which violates the fundamental right to privacy. She states that the fact that an official employed in a non-member State receives free accommodation and comprehensive health cover is totally irrelevant; the fact that she does not incur such expenditure at her place of employment cannot limit her right to spend the whole of her remuneration at that place.

21. As I have already observed, Mrs Scaramuzza is not prevented, by the rule in question, from spending her salary as and where she pleases or from transferring the 20% from Belgium to her place of employment. She may of course find that it is not in her interest to do so unless the weighting for her place of employment is applied to the 20%. If she wishes to have that weighting applied to the 20% or to a part of it, she must, under Article 1 of the Internal Directives, submit a request to the Commission stating reasons to justify payment of more than 80% of her remuneration in the currency of her place of employment.

22. Mrs Scaramuzza objects to that requirement on the ground that it would involve an invasion of her privacy, contrary to Article 8 of the European Convention on Human Rights and Article 12 of the Universal Declaration of Human Rights. Both those instruments proclaim the individual' s right to respect for his private and family life, home and correspondence.

23. Although Article 12 of the Universal Declaration of Human Rights was pleaded at first instance (as is clear from paragraph 27 of the judgment appealed against), the Court of First Instance did not, in an otherwise exhaustive analysis, rule specifically on the alleged breach of fundamental rights. I do not, however, think that the judgment should be annulled for that reason.

24. The Court of Justice has consistently held (4) that fundamental rights form an integral part of the general principles of law, the observance of which it ensures. For that purpose the Court draws inspiration from the constitutional traditions common to the Member States and from the guidelines supplied by international treaties for the protection of human rights on which the Member States have collaborated or of which they are signatories. The European Convention on Human Rights has special significance in that respect.

25. It is clear that the Community institutions must, when applying the Staff Regulations to their officials, respect fundamental rights, including the right to privacy enshrined in Article 8 of the European Convention on Human Rights. However, I do not think that a rule requiring an official to state reasons to justify payment of more than 80% of his remuneration in the currency of his place of employment can in itself entail a breach of the fundamental right to privacy.

26. That is not to say that the application of such a rule cannot ever lead to a breach of the right to privacy. Much will depend on the kind of information which the Commission requires before acceding to a request for more than 80% of an official' s remuneration to be paid in the currency of the place of employment. If the Commission is satisfied with a statement explaining that the official has no financial commitments in Belgium or in his Member State of origin, and giving basic details about exceptional expenditure that he has incurred in the country of employment (for example, the purchase of a house, a sailing boat or a motor caravan), then I do not think that the official' s right to privacy would be impaired by disclosure of such information. If, on the other hand, the Commission were to require details of all the official' s expenditure over a certain period or if it were to demand access to all his bank statements, that would obviously be a different matter.

27. Mrs Scaramuzza has not alleged that there has been such a request for information. She is simply challenging the rule itself. For the reasons given above, I do not think that such a challenge can succeed.

28. It follows that the appeal must be dismissed.

Costs

29. Under Article 70 of the Rules of Procedure, the normal rule in proceedings between Community institutions and their servants is that the institutions bear their own costs. However, under the second paragraph of Article 122 of the Rules of Procedure, that rule does not apply in the case of appeals except where the appeal is brought by the institution. Therefore, as regards the costs of the appeal, the general rule laid down in Article 69(2) of the Rules of Procedure applies, with the result that the appellant should be ordered to pay the costs of the appeal.

Conclusion

30. Accordingly, I am of the opinion that the Court should:

(1) dismiss the appeal;

(2) order the appellant to pay the costs of the appeal.

(*) Original language: English.

(1) - OJ 1987 L 286, p. 3.

(2) - Case T-75/91 Scaramuzza v Commission [1992] ECR II-2557.

(3) - See, for example, Case C-301/90 Commission v Council [1992] ECR I-221, paragraph 22 of the judgment.

(4) - See, for example, Case C-260/89 ERT [1991] ECR I-2925, paragraph 41 of the judgment.