Communication from the Commission to the European Parliament pursuant to the second subparagraph of Article 251(2) of the EC Treaty concerning the common position of the Council on the adoption of a Regulation of the European Parliament and of the Council on the coordination of social security systems
Date: 2004-01-27
Institutions: European Commission
Subjects: EU Member State, social security, social-security harmonisation

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 27.1.2004
COM(2004) 44 final

1998/0360 (COD)

COMMUNICATION FROM THE COMMISSION
TO THE EUROPEAN PARLIAMENT

pursuant to the second subparagraph of Article 251(2) of the EC Treaty

concerning the

common position of the Council on the adoption of a Regulation of the European
Parliament and of the Council on the coordination of social security systems

EN

  EN

1998/0360 (COD)

COMMUNICATION FROM THE COMMISSION
TO THE EUROPEAN PARLIAMENT

pursuant to the second subparagraph of Article 251(2) of the EC Treaty

concerning the

common position of the Council on the adoption of a Regulation of the European
Parliament and of the Council on the coordination of social security systems

1.

BACKGROUND

On  21  December  1998,  the  Commission  presented  to  the  European  Parliament  and
the  Council  its  proposal  for  a  Regulation  COM(1998) 779  final.  The  European
Economic  and  Social  Committee  delivered  its  opinion  on  27  January  2000.  The
European Parliament presented its opinion on first reading on 3 September 2003.  It
adopted  47 amendments.  The  Commission  accepted  40  in  full,  three  in  part,  and
rejected four.

Following  the  opinion  of  the  European  Parliament  and  in  accordance  with
Article 250(2)  of  the  EC  Treaty,  the  Commission  adopted  an  amended  proposal
(COM(2003) 596  final),  which  was  forwarded  to  the  European  Parliament  and  the
Council on 10 October 2003.

The  Council  reached  a  partial  political  agreement  on  a  common  position  on
1 December  2003  and  adopted  its  common  position  unanimously  on  26  January
2004.

2.

AIM OF THE COMMISSION PROPOSAL

Regulation (EEC) No 1408/711 ensures the coordination of the social security schemes
of Member States in order to protect the rights of persons moving within the European
Union.

Since  its  adoption  in  1971,  the  Regulation  has  undergone  a  considerable  number  of
amendments  in  order  to  take  account  of  changes  to  national  legislation,  improve
certain provisions, remedy deficiencies or cover the situation of particular categories
of  persons.  Furthermore,  certain  provisions  require  clarification  in  order  to  avoid
interpretation  problems,  as  evidenced  by  the  large  number  of  judgments  on
coordination  issues  delivered  by  the  Court  of  Justice.  The  goal  pursued  by
coordination  must  also  be  adapted  to  changes  in  the  European  Union  as  a  whole.

1

Council Regulation (EEC) No 1408/71 of 14 June 1971 on the application of social security schemes to
employed  persons,  to  self-employed  persons  and  to  members  of  their  families  moving  within  the
Community,  OJ  L  149,  5.7.1971,  p.  2  Updated  by  Council  Regulation  (EC)  No  118/97  (OJ  L  28,
30.1.1997, p.1) and last amended by Regulation (EC) No 1386/2001 of the European Parliament and of
the Council (OJ L 187, 10.7.2001, p.1).

2

 
                                                
Coordination  rules  are  not  just  intended  to  ensure  free  movement  for  employed
persons;  they  are  also  increasingly  about  protecting  the  social  security  rights  of  all
persons  moving  within  the  European  Union.  Coordination  must  therefore  be  seen
from the perspective of European citizenship and the building of a social Europe.

In order to meet these needs, the Commission proposal therefore has the dual aim of
on the one hand simplifying the coordination of social security systems and, on the
other, of modernising it.

3.

COMMENTS ON THE COMMON POSITION

3.1.

General comments

The unanimous political agreement reached by the Council on 1 December 2003 was
taken over in the common position adopted on 26 January 2004.

The common position  of  the  Council  essentially  preserves  the  Commission's  initial
proposal as amended by the amended proposal.

The  common  position  therefore  consists  in  particular  of  the  following  essential
elements:

– 

– 

– 

– 

– 

the  personal  scope  of  the  Regulation  is  extended  to  cover  all  nationals  of
Member States who are covered by the social security legislation of a Member
State.  This  means  that  not  only  employed  workers,  self-employed  workers,
civil  servants,  students  and  pensioners  but  also  non-active  persons  are
protected  by  the  coordination  rules.  This  simplifies  and  clarifies  the  rules
determining the legislation applicable in cross-border situations;

the  material  scope  of  the  Regulation  is  extended  to  cover  statutory  pre-
retirement  schemes,  which  means  that  the  beneficiaries  of  such  schemes  will
have a guarantee that benefits will be paid, will be covered for health care and
will receive family benefits even if they reside in another Member State;

the principles of equal treatment and the assimilation of facts are strengthened;

insured  persons  staying  temporarily  in  another  Member  State  will  be  able  to
benefit from health care judged to be medically necessary during that stay;

there is provision for a greater obligation for cooperation and mutual assistance
between the institutions of the Member States for the benefit of citizens.

The Commission accepts the common position which, while less ambitious than its
initial  proposal,  amended  following  Parliament’s  opinion,  represents  a  point  of
balance given the constraints and characteristics of the Member States’ various social
security systems. It constitutes an important advance in terms of the free movement
of citizens while safeguarding their social security rights.

3

 
3.2.

The European Parliament's amendments on first reading

The European Parliament adopted 47 amendments on first reading.

Amendments 3, 4, 5, 6, 8, 9, 10, 12, 13, 14, 15, 16, 17, 18, 19, 21, 22, 23, 24, 25, 26,
28,  29,  30,  31,  32,  34,  35,  37,  39  and  55  were  accepted  in  full  both  in  the
Commission’s amended proposal and in the Council’s common position.

Amendments 7 and 52 were accepted in the amended proposal and were subject, in
the common position, to rewording which may be approved by the Commission (cf.
Articles 1 l) and 76 (6) of the common position).

Amendments 11, 44 and 51 were accepted in part in the amended proposal and in
the common position.

The first paragraph of amendment 11 was accepted in full in the common position,
but  paragraph  2  was  made  more  flexible  in  order  to  restrict  itself  to  annual
declarations, which appears to be more in line with the aim of the provision.

Combined amendments 51 and 44, accepted in part by the amended proposal, are
also reflected in substance in the  common position, Article 72 c)  of  which calls on
the Administrative Commission "to foster and develop cooperation between Member
States  and  their  institutions  in  social  security  matters,  particularly  with  a  view  to
responding to particular questions from certain categories of persons; to facilitate, in
the field of coordination of social security, transnational cooperation measures".

The Commission had accepted amendment 48 in its amended proposal, underlining
the need for greater convergence between the coordination of social security schemes
and certain provisions contained in the double taxation agreements. This amendment
is not included in the Council’s common position.

Amendment  56  is  integrated  in  the  amended  proposal  but  is  not  included  in  the
common  position.  The  Council  did  not  consider  it  necessary  in  view  of  the
amendments  to  the  provisions  relating  to  unemployment  benefits  for  unemployed
people who, during their last employment, resided in a Member State other than the
competent State (cf. point 3.3.9.).

Amendments 46, 47, 50, 53 and 54 were accepted in full in the amended proposal,
and their substance is taken over in the common position.

Amendment 46, relating to the link between social security legislations and certain
contractual provisions, is taken into account in recital 6 of the common position. The
Council is planning to proceed in stages with, initially, an  evaluation of experience
by the Member States which have given notification of such contractual provisions.
The Commission supports this position, which will permit analysis of whether there
is  a  need  to  introduce  legislation  aimed  at  coordinating  certain  provisions  of
agreements.

Amendment 47 is reflected in recital 8 of the common position. It has been extended
to cover all workers not resident in the State in which they work. The Commission is
in favour of this expanded wording, as the principle of equal treatment is important
for all workers, not only for cross-border workers as defined by the Regulation.

4

 
Amendment  50,  relating  to  entitlement  to  benefits  in  kind  in  the  State  of
employment for members of the family of cross-border workers, is largely reflected
in recital 23 and in Article 18 (2) of the common position. The Council decided that
members of the family of cross-border workers may receive benefits in kind during a
stay  in  the  competent  State,  unless  that  State  refuses  this  by  virtue  of  an  entry  in
Annex III to the Regulation. In this case, it is stated that family members may  still
receive  such  benefits  in  kind  as  may  be  necessary  during  a  stay  in  the  competent
State.  Although  seven  Member  States  are  listed  in  Annex  III,  the  Commission
accepts this solution, which is a significant improvement over the current situation as
regards entitlement for family members.

Amendment  53  is  reflected  in  part  in  recital  21  and  Article  20  of  the  common
position.  The  Council  has  maintained  the  principle  of  prior  authorisation  for  non-
hospital care. Although the Commission regrets that this advance could not be made
within the framework of the Regulation, it nevertheless points out that the bearing by
the  competent  institution  of  the  costs  of  such  care  obtained  abroad  without  prior
authorisation  is  possible  in  principle  on  the  basis  of  Article  49  of  the  Treaty,  in
accordance  with  the  case  law  of  the  Court  of  Justice2.  In  these  conditions;  and
bearing in mind the specific characteristics of the Regulation and the aim thereof, as
examined most recently by the Court in the Inizan case3, the Commission can accept
the position.

Amendment  54  is  reflected  in  part  in  Article  28  (2).  This  provision  states  that  a
retired  former  cross-border  worker  may  continue  to  receive  benefits  in  kind  in  the
former State of employment, on condition that the latter State and the State bearing
the cost of benefits have opted for this solution and are listed in Annex V. Given the
fact that seven Member States are already listed in this annex, the Commission can
accept  this  solution  as  a  compromise  which  improves  the  situation  for  pensioners
who are former cross-border workers.

Amendments 38, 40, 45 and 49 were not accepted either in the amended proposal or
in  the  common  position.  The  Commission  considers  that  provisions  such  as  those
referred  to  in  amendments  38  and  40  are  more  suited  to  the  implementing
Regulation. With regard to  amendments 45 and 49,  these  exceed  the  scope  of  the
coordination of social security schemes as laid down by the EC Treaty.

3.3.

New provisions introduced by the Council, and the Commission's position

3.3.1.

Recitals

A  number  of  recitals  have  been  amended  or  added  for  greater  coherence  with  the
amendments in the Commission proposal (recitals 1a, 2, 5, 8, 9, 10, 11, 18, 20, 22,
23, 29, 30, 31, 32, 33, 35, 36, 41, 42, 43 and 44).

2

3

Judgments  given  on  28.4.1998,  Kohll  (case  C-158/96)  and  Decker  (C-120/95);  judgment  given  on
12.7.2001,  Smits  and  Peerbooms  (C-157/99),  judgment  given  on  13.5.2003,  Müller-Fauré/Van  Riet
(C-385/99).
Judgment given on 23.10.2003, Case C-56/01.

5

 
                                                
3.3.2.

Provisions relating to Title I –General provisions

Apart from the amendments by Parliament integrated into the common position, only
Article 4 has undergone certain amendments:

– 

– 

the  Council,  for  reasons  of  legal  safety,  has  opted  for  an  exhaustive  list  of
branches  of  social  security  instead  of  the  indicative  list  in  the  Commission
proposal, adding the branch "pre-retirement " to the current list;

as  part  of  the  definitions,  reference  is  made  to  "regulatory  provisions
concerning  branches  of  social  security"  that  include  various  "benefits";  it  is
specified  that  the  Regulation  applies  to  special  non-contributory  benefits,  but
not to benefit schemes for victims of war or of the consequences of war.

The Commission accepts these amendments, which reflect the acquis and represent a
modest but positive advance over the current situation.

3.3.3.

Provisions  relating  to  Title  II  –  Determining  the  legislation  to  which  a  person  is
subject

The common position amends Articles 11 and 13.

Details of the legislation applicable are given in these Articles, either in the context
of an unemployment situation or in the event of carrying out activities in the territory
of two or more Member States. These details are fully acceptable to the Commission
and are such as to contribute to the improved application of coordination.

3.3.4.

Provisions relating to Title III – Chapter 1: Sickness, maternity and paternity

The structure of the chapter has been amended in the common position.

Sections have been inserted in order to distinguish provisions relating to pensioners
and  members  of  their  families  from  those  applicable  to  other  categories  of  insured
persons. A distinction is also made between benefits in kind and cash benefits. These
amendments  to  the  structure  permit  greater  clarity  in  the  provisions  without
involving an intrinsic loss of entitlement for insured persons.

Death  benefits,  which  in  the  Commission  proposal  were  considered  as  sickness
benefits  in  kind,  no  longer  figure  in  this  chapter  but  in  a  specific  chapter  (cf.
point 3.3.6).

With  regard  more  specifically  to  pensioners, 
the  common  position  makes
amendments  which  essentially  have  implications  for  the  sharing  of  the  burden  of
benefits between institutions. In this regard the Council, for both benefits in kind and
cash  benefits,  preferred  to  maintain  the  status  quo.  Since  financial  arrangements
between  the  institutions  of  the  Member  States  are  dealt  with  here,  and  in  principle
insured persons’  entitlement to  sickness  protection  is  not  affected,  the  Commission
accepts the Council’s position.

6

 
Following the amendments concerning the bearing of the financial burden of care for
pensioners,  the  Council  did  not  adopt  the  solution  in  the  Commission  proposal
concerning  the  designation  of  the  State  responsible  for  collecting  contributions  for
the funding of sickness insurance. It provides for these contributions  to  continue to
be collected in principle by the Member State bearing the financial burden of benefits
for the pensioner on the basis of its legislation.

A  provision  is  also  inserted  to  resolve  the  question  of  the  aggregation  of  cash
benefits for unlimited care (care allowances) which are regarded as sickness benefits.
The Commission accepts this amendment, which  draws  the  conclusions of  the  case
law of the Court4 in practice.

3.3.5.

Provisions  relating  to  Title  III  –  Chapter  2:  Industrial  accidents  and  occupational
diseases

The common position does not significantly amend the Commission proposal on this
chapter.  Basically,  the  amendments  consist  of  deleting  provisions  which  have
become superfluous (particularly in Article 42 of the Commission proposal), owing
to the addition in Article 5 of the general principle of assimilation of facts.  Certain
rules  inserted  in  Article  46  of  the  Commission  proposal  to  take  account  of  the
particular nature of certain legislations have been deleted as a result of changes in the
legislation in question.

With regard to transport costs for the victim of an industrial accident or occupational
disease,  the  common  position  provides  for  the  principle  of  bearing  the  costs  on
condition  that  the  institution  has  agreed  in  advance  to  such  transport,  taking  due
account  of  the  elements  used  to  justify  it.  The  Commission  considers  that  this
problem deserved a bolder solution. It points out that this question may be examined
at a later stage within the framework of the implementing Regulation.

3.3.6.

Provisions relating to Title III – Chapter 3: Death grants

In the common position, the Council has included a specific chapter for death grants,
as set out in the current Regulation (EEC) No 1408/71, although they were dealt with
in the Commission proposal as sickness benefits in kind.

The Commission can accept this position in so far as implementation of the current
provisions does not appear to have given rise to any particular difficulties.

3.3.7.

Provisions relating to Title III – Chapter 4: invalidity benefits

For  reasons  of  simplification,  the  Commission  had  proposed  replacing  the  current
"dual"  system  of  coordination  with  a  single  coordination  system,  so  that  invalidity
benefits  are  always  calculated  in  accordance  with  the  provisions  of  the  chapter  on
"pensions".

4

Judgment given on 5.3.1998, Case C-160/96.

7

 
                                                
The  current  system  lays  down  that,  if  a  person  has  been  insured  exclusively  under
legislations  where  the  amount  of  invalidity  benefit  is  independent  of  the  length  of
insurance periods (“A” systems), that person is entitled to a single benefit, granted by
the  Member State where the person was insured at  the  time  the invalidity  occurred
(“single pension” system).

If  the  person  was  insured  either  exclusively  under  legislations  where  the  amount
depends on the length of the insurance period ("B" systems) or under both types of
insurance,  he  is  entitled  to  benefits  calculated  in  accordance  with  the  chapter  on
"pensions" ("pro rata" system).

The  common position makes provision  for  maintaining  the "dual" system,  but  only
for those Member States which have an "A" system and have opted for this approach
by means of an entry in an annex.

For the Commission, this is an acceptable compromise. While regretting the fact that
this simplification could not take place, the Commission notes that the current system
does not appear to cause any major difficulties.

3.3.8.

Provisions relating to Title III – Chapter 5: Old-age and survivor’s pensions

The  Commission  proposal  did  not  fundamentally  change  the  provisions  of  this
chapter,  as  the  simplification  exercise  consisted  mainly  of  making  the  applicable
rules more comprehensible by improving  the  terminology used  and the structure of
the chapter. The Council’s common position does not overturn the provisions of this
chapter.

One amendment concerns Article 55 on the aggregation of pensions with benefits of
a  different  nature,  dealing  with  situations  of  unjustified  aggregation.  This  is
acceptable to the Commission.

The common position also maintains the provision in the current Regulation (EEC)
No 1408/71 whereby a Member State is not obliged to grant a pension if the length
of periods completed under its legislation amounts to less than one year and if, taking
only these periods into account, no entitlement to benefits has been established under
the provisions of that legislation. In this case, the periods in question are taken into
account by the  other  Member  States  concerned. Since the provision  lays down that
there shall be no loss of rights for the insured person, the Commission can accept this
position.

The common position also maintains the provisions particular to special schemes for
civil  servants,  which  is  acceptable  to  the  Commission,  given  the  particular
characteristics of these schemes.

3.3.9.

Provisions relating to Title III – Chapter 6: Unemployment

The Commission proposal introduced two basic amendments to the chapter:

– 

extending  from  three  months  to  six  the  period  during  which  the  unemployed
person may seek work in another Member State without losing entitlement to
unemployment benefits;

8

 
– 

ending  the  current  system  whereby  the  unemployed  cross-border  worker
receives  unemployment  benefits  from  the  State  of  residence  rather  than  the
competent State (the State where he was last employed).

The Council was unable to reach agreement on these two points. In order to reach a
compromise,  two  aspects  have  been  singled  out:  the  treatment  of  unemployed
persons on the one hand and, on the other, the distribution of the financial burden of
unemployment  allowances  between  the  State  of  last  employment  and  the  State  of
residence.

With regard to the situation for the persons concerned, the common position provides
for:

– 

– 

– 

maintaining  the  current  three-month  period  during  which  the  unemployed
person may seek work in another Member State without losing entitlement to
unemployment  allowances,  while  permitting  the  competent  institution  to
extend this period to six months;

maintaining the current  system  whereby  the  unemployed  cross-border  worker
receives  unemployment  benefits  from  the  State  of  residence  (with  the
obligation to be available to the employment services of that State);

the system is supplemented, however, by the unemployed cross-border worker
also  having  the  right  to  be  available  to  the  employment  services  of  the
competent State.

With regard to the sharing of the financial burden between the Member States:

– 

– 

– 

the current principle in Regulation (EEC) No 1408/71 of the State of residence
having competence has been maintained;

however, the competent State (State of last employment) should, for a period of
three  months,  reimburse  to  the  State  of  residence  the  costs  of  unemployment
benefits paid by the latter State;

this period of reimbursement is extended to five months where the worker has
carried  out  an  activity  during  12  of  the  preceding  24  months  in  the  Member
State to whose legislation he was last subject.

In order to answer the concerns of Luxembourg, a specific transitional provision has
been inserted in point 10 of Article 87 (this stipulates that the provisions referred to
in  Article  65  (2)  and  (3)  shall  apply  to  Luxembourg  not  later  than  two  years
following the date of implementation of the new Regulation).

The  Commission  can  accept  this  position  overall.  Firstly,  it  points  out  that  the
conditions  under  which  the  unemployed  person  may  seek  employment  in  another
Member State without losing unemployment allowances are improved with a view to
facilitating job-seeking. In addition, the cross-border worker is in a better position to
find employment since he can register to seek work both in the State of residence and
in  the  State  in  which  he  formerly  worked.  These  two  elements,  offering  an
unemployed  person  a  better  chance  of  finding  employment,  correspond  to  the
Commission’s aims and constitute an improvement over the current situation. On the
other  hand,  the  arrangements  relating  to  the  sharing  of  the  financial  burden  of

9

 
unemployment  benefits  between  the  Member  States  do  not  affect  the  unemployed
person’s entitlement to benefit.

3.3.10. Provisions relating to Title III – Chapter 7: Pre-retirement benefits

In  its  proposal,  the  Commission  laid  down  a  particular  provision  on  aggregation
owing to the nature of pre-retirement benefits and to the  fact  that  the  legislation of
the Member States does not make entitlement to this type of benefits subject to the
completion of periods of residence.

In its common position, the Council excludes the rule on the aggregation of periods
for  granting  benefits.  This  exclusion  is  explained  by  the  fact  that  statutory  pre-
retirement  schemes  (the  Regulation  based  on  Article  42  of  the  EC  Treaty  applies
only to statutory social security schemes) only exist in a limited number of Member
States (cf. recital 33 of the common position).

With  regard  to  the  characteristics  of  pre-retirement  schemes,  the  Commission  can
accept  this  position,  taking  into  account  the  fact  that  there  has  been  significant
progress, since by including "pre-retirement" in the scope of the Regulation although
it  was  previously  excluded,  the  principles  contained  in  Title  I  will  apply  to  pre-
retirement benefits, which means that, in particular, the principle of equal treatment,
the export of benefits and the granting of family and sickness benefits to the persons
concerned will be guaranteed.

3.3.11. Provisions relating to Title III – Chapter 8: Famiy benefits

The  Commission  proposal  aimed  to  restructure  this  chapter,  laying  down  a  single
rule for all family benefits where entitlements exist in a number of Member States:
the  State  laying  down  the  highest  amount  pays  the  benefits,  with  the  burden  then
being shared in proportion to the number of States concerned.

The  common  position  opts  for  a  less  ambitious  solution,  but  one  consisting  of  a
single chapter and identical provisions for all categories of persons, putting an end to
the  existing  distinction  between  pensioners  and  orphans  on  the  one  hand  and  other
categories of insured persons on the other.

In order to determine the legislation applicable where entitlements exist in a number
of  Member  States,  the  Council  has  adopted  a  coherent  set  of  priority  rules,  giving
priority  to  the  legislation  of  the  Member  State  of  employment.  The  system
established  also  guarantees  that  the  insured  person  is  paid  the  highest  amount  of
benefits,  in  the  form  of  a  differential  supplement  paid  by  another  Member  State
whose legislation also establishes an entitlement to benefits.

The common position also lays down favourable provisions for orphans in Article 69
and  greater  cooperation  between  the  Member  States  on  the  implementation  of  the
priority rules (Article 68 (3)).

The Commission accepts this position, which clarifies and facilitates implementation
of the provisions of this chapter and also maintains entitlement to the highest family
benefits for insured persons.

10

 
In contrast, the Council decided to exclude advances on maintenance payments from
the scope of the Regulation (cf. Article 1 (z) and  recital 36). It has also maintained
the  exclusion  for  special  birth  and  adoption  benefits  (cf.  Article  1  (z))  currently  in
Regulation  (EEC)  No  1408/71,  owing  to  their  close  link  with  the  socio-economic
environment of the State concerned.

With regard to advances on maintenance payments, the Commission can accept this
position,  having  regard  to  the  characteristics  of  the  benefits  in  question  and  to  the
specific problems which their coordination poses in practice. On the other hand, the
Commission regrets that no agreement could be reached on the inclusion of special
birth  and  adoption  benefits.  Nevertheless,  bearing  in  mind  the  balanced  overall
nature of this chapter, with regard to the extension of benefits to non-active persons,
the Commission can accept the Council’s position.

3.3.12. Provisions relating to Title III – Chapter 9: Special non-contributory benefits

In this chapter, the common position adopts Parliament’s amendment No 55, which
was accepted in full in the Commission’s amended proposal.

3.3.13. Provisions relating to Title IV – Administrative Commission and Advisory Committee

for the coordination of social security systems

The common position provides clarification on certain points (Article 72 b), c), d), f)
and  g))  of  the  terms  of  reference  of  the  Administrative  Commission  and  the
Technical Commission (Article 73 d)).

It  also  inserts  in  the  Regulation  a  provision  relating  to  the  Audit  Board  which  is
currently in the implementing Regulation.

The  Commission  proposal  contained  no  provision  relating  to  the  Advisory
Committee for the coordination of social security systems, owing to the existence of
a  Commission  proposal  to  merge  the  Advisory  Committee  on  social  security  for
migrant  workers  with  the  Advisory  Committee  for  migrant  workers5.  As  this
proposal  has  not  yet  been  implemented,  there  is  justification  for  a  provision  to  be
inserted to define the composition and tasks of this committee.

3.3.14. Provisions relating to Title V – Miscellaneous provisions

The common position makes substantial improvements to Article 76 with a view to
strengthening  the  duty  of  cooperation  between  institutions  but  also  between  the
institutions and insured persons. The Commission considers these aspects to be very
positive. On the one hand, these provisions can only facilitate the implementation of
the provisions of the Regulation, and on the other they will enable insured persons to
demand  to  have  their  situation  regulated  under  the  strengthened  obligation  for
cooperation between institutions.

5

COM(1998) 394.

11

 
                                                
3.3.15. Provisions relating to Title VI –Transitional and final provisions

The  common  position  amends  Article  87,  particularly  in  order  to  support  the
consequences  of  amendments  introduced  which  are  likely  to  affect  the  situation  of
certain insured persons (cf. points 8 and 9). As provisions of this type are traditional
and  essential  where  coordination  rules  are  evolving,  the  Commission  accepts  this
position, which takes account of the general interests of insured persons.

In  addition,  provision  is  made  for  a  transition  period  for  the  implementation  of
Article  65  (2)  and  (3)  for  Luxembourg  (cf.  point  3.3.9)  which  corresponds  to  the
global agreement of the Council on the unemployment chapter.

The Council has also added a provision to ensure that the Member States introduce
provisions  relating  to  supplying  the  appropriate  information  on  changes  brought
about  by  the  new  Regulation.  The  Commission  can  only  approve  this  initiative  for
the benefit of all persons affected by the Regulation.

Finally,  the  Council  has  established  methods  to  support  the  changeover  from  the
current  Regulation  (EEC)  No  1408/71  to  the  new  coordination  instrument.  In  this
regard,  a  particular  provision  is  inserted  in  Article  90  so  that  Regulation  (EEC)
No 1408/71 retains its force until certain Regulations and agreements referring to this
Regulation are repealed or amended. The Commission supports this position.

4.

CONCLUSIONS/GENERAL COMMENTS

The Commission approves the common position as a whole, as it broadly meets the
aims  of  the  Commission  proposal.  Moreover,  it  takes  into  account  most  of
Parliament’s  amendments.  At  the  end  of  long  negotiations,  although  greater
simplification  in  some  areas  would  have  been  preferable,  it  constitutes  a  balanced
and positive overall compromise for insured  persons  over  all chapters.  Under  these
conditions,  the  Commission  considers  this  instrument  to  be  essential  in  order  for
citizens  to  exercise  their  right  of  free  movement  while  safeguarding  their  social
security rights.

5.

COMMISSION STATEMENTS

See Annex.

12

 
ANNEX

DRAFT STATEMENT FOR THE COUNCIL MINUTES

Joint statement from the Council and the Commission:

"Recognising  that  this  Regulation  will  not  become  applicable  until  all  of  the  Annexes  have
been  completed  and  the  Implementing  Regulation  has  been  adopted,  the  Council  and  the
Commission agree that a number of entries or provisions should be inserted into the Annexes
and the Implementing Regulation, as follows:

1)

Annex XI (ad Articles 3 (2) and 70 (2)(c)):

Taking into account the specific situation under Austrian and German legislation concerning
special  non-contributory  cash  benefits,  the  territorial  scope  of  which  is  confined  to  part  of
their  territory  and  which  are  excluded  by  virtue  of  Article  4(2b)  of  Regulation  (EEC)  No
1408/71, the following entries should be inserted in Annex XI to the Regulation:

“AUSTRIA”

This  Regulation  does  not  apply  to  benefits  granted  under  Bundeslaender  legislation  for
disabled persons and persons in need of care.

“GERMANY”

This Regulation does not apply to benefits granted under Laender legislation for the disabled,
and in particular for the blind.

2)

the Implementing Regulation and Annex XI (ad Articles 5 and 6)

Specific provisions, to be established in the context of the Implementing Regulation, should
aim  both  at  preventing  any  possible  overlapping  impact  of  the  principle  of  assimilation  of
facts or events under the legislation of two or more Member States and, at complementing, by
analogy,  the  priority  rules  already  provided  for  under  the  existing  Article  15  of  Regulation
(EEC) No 574/72, which will be reintroduced in the new Implementing Regulation.

In  cases  where  it  is  ascertained  that,  due  to  the  specific  features  of  national  legislation,  the
unconditional implementation of the principle of assimilation of facts or events could lead to
objectively  unjustified  results,  the  Member  State  concerned  would  seek  for  the  appropriate
Annex  XI  entry,  guaranteeing  specific  coordination  in  the  light  of  the  principle  of
proportionality.

3)

the Implementing Regulation (ad Articles 24 to 26 and 35)

A balanced sharing between Member States of the cost of benefits in kind for pensioners and
members  of  their  family  must  be  established.  In  cases  where  the  reimbursement  between
States  of  the  cost  of  benefits  in  kind  to  pensioners  and  members  of  their  families  –  under
Articles 24 to 26 of the text – is carried out on the basis of a fixed amount, the fixed amount
will constitute 85% of the average annual cost of benefits in kind for pensioners and members
of their families in the State of residence. The remaining 15% is expected to concern the cost
of  benefits  in  kind  for  pensioners  and  members  of  their  families,  which  become  medically
necessary  during  their  stay  in  Member  States  other  than  the  State  of  residence.  To  avoid
Member  States  which  have  opted  for  the  possibility  under  Article  27(2),  and  are  listed  in

13

 
Annex IV, being overburdened by comparison with Member States which have not so opted,
the States listed in Annex IV will reimburse to the State of residence of the pensioner or the
members of his family only a reduced lump sum amounting to 80 % of the cost.

This condition shall be reflected in the provisions on the reimbursement of the cost of benefits
in  kind  for  pensioners  and  members  of  their  families  that  are  to  be  laid  down  in  the
Implementing Regulation.

Provision shall also be made in the Implementing Regulation to ensure that a Member State
that calculates average annual costs does not impose double payment on other Member States.

4)

the Implementing Regulation (ad Article 27(5))

Ireland, Germany and the Netherlands being concerned about the administrative and possible
financial  implications  of  Article  27(5),  a  satisfactory  solution  should  be  found  in  the
implementing Regulation in order to avoid problems connected to double payment and of cost
control.

5)

the Implementing Regulation (ad Article 30)

The application of Article 5, in relation to Article 30, will be dealt with in the Implementing
Regulation.

6)

Annex XI (ad Article 34)

The following paragraph shall be registered in Annex XI:

“(b) When  applying  Article  34,  the  Netherlands  will  provide  a  list  of  estimates  of  the
amounts which are as close as possible to the actual expenditure incurred.”

7)

Annex XI (ad Article 46)

The following entry concerning the United Kingdom should be inserted in Annex XI:

Where  Article  46  applies,  if  the  person  concerned  suffers  incapacity  for  work  leading  to
invalidity while subject to the legislation of another Member State, the United Kingdom shall,
for the purposes of Section 30A(5) of the Social Security Contributions and Benefits Act 1992,
take  account  of  any  periods  during  which  the  person  concerned  has  received,  in  respect  of
that incapacity for work:

(i)

cash sickness benefits or wages or salary in lieu thereof,

benefits  within the  meaning  of  Chapters  4  and  5  granted  in  respect  of  the  invalidity
(ii)
which followed that incapacity for work under the legislation of the other Member State, as
though  they  were  periods  of  short-term  incapacity  benefit  paid  in  accordance  with
Sections30A(1)-(4) of the Social Security Contributions and Benefits Act 1992.

14

 
The following entry concerning Ireland should be inserted in Annex XI:

Where  Article  46  applies,  if  the  person  concerned  suffers  incapacity  for  work  leading  to
invalidity  while  subject  to  the  legislation  of  another  Member  State,  Ireland  shall,  for  the
purposes of Section 95(1)(a) of the Social Welfare (Consolidation) Act, 1993 take account of
any periods during which, in respect of the invalidity that followed that incapacity for work,
he was regarded as being incapable of work under Irish legislation.

8)

Implementing Regulation (ad Article 50):

Given  the  general  interest  in  determining  a  common  procedure  for  implementing  uniformly
this  Article  with  regard  to  the  date  to  be  counted  for  the  date  of  submission  of  a  claim  in
respect  of  each  institution  concerned,  in  those  “extraordinary”  cases  where  the  person
concerned, when submitting the initial claim, provides no indication whatsoever of periods of
insurance or residence having being completed under the legislation of a particular  Member
State, providing full information of his/her entire insurance career only at a later date (second
claim  or  effective  submission  of  the  initial  claim,  sometimes  at  a  very  remote  date),  it  was
agreed that the issue of the administrative and economic consequences of such a retroactive –
“deferred”  –  involvement  of  the  institutions  concerned,  both  for  the  latter  and  the  ad  hoc
claimant,  shall  be  dealt  with  under  a  comprehensive  provision  of  a  general  character,  to  be
established  in  the  context  of  the  Implementing  Regulation,  which  should  expressly  and
comprehensively define the overall mutual rights and obligations both for the insured and the
institutions involved.

In the light of the principles of equivalence and effectiveness for the purposes of fulfilling the
objectives of Article 42 of the Treaty (from which Article 50 stems), to the extent that such a
delayed  –  a  posterior  effective  –  claim  may  be  assimilated  to  an  express  request  for
postponement of the award of benefits (intentional omission), specific provisions should first
expressly  state  that  such  an  assimilation  is  subject  to  the  legislation  in  question  containing
more favourable  provisions in respect of the  retroactive effects  of  a  claim  than  those  of  the
Implementing  Regulation  and,  secondly,  that,  although  the  person  concerned  has  submitted
the initial claim on a form, clearly asking for detailed information on the periods of insurance,
employment  or  residence  in  the  territory  of  another  State  and  has  been  informed  about  the
consequences  of  possible  omissions  from  his/her  part,  has  either  given  no  indication  or  has
merely given a negative reply in the corresponding sections of the document.

9)

Annex XI (ad Article 51):

The following entry concerning Denmark should be inserted in Annex XI:

1.
Notwithstanding  the  provisions  of Article 6 of  the Regulation,  persons who  have  not
been  gainfully  employed  in  one  or  more  Member  States  are  entitled  to  a  Danish  social
pension only if they have been, or have previously been, permanent residents of Denmark for
at  least  three  years,  subject  to  the  age-limits  prescribed  by  Danish  legislation.  Subject  to
Article 4, Article 7 does not apply to a Danish social pension to which entitlement has been
acquired by such persons.

2.
The above-mentioned provisions do not apply to Danish social pension entitlement for
the family members of persons who are or have been gainfully employed in Denmark, nor for
students or the members of their families.

15

 
10)

Annex XI (ad Article 52):

It  is  agreed  that  the  issue  raised  by  Sweden  in  the  context  of  article  52  should  be  first
examined by the Administrative Commission and, if an appropriate solution cannot be found
in that context, that it should be solved by an Annex XI – “SWEDEN” entry.

11)

Annex XI (ad Article 54):

The following entry concerning Finland should be inserted in Annex XI:

For  the  purposes  of  determining  entitlement  and  of  calculating  the  amount  of  the  Finnish
national pension under Articles 52 to 54, pensions acquired under the legislation of another
Member State are treated in the same way as pensions acquired under Finnish legislation.

12)

Implementing Regulation (ad Article 56):

For the calculation of benefits or parts of benefits which are financed exclusively by a funded
pension scheme, only the capital accrued in this sense in this scheme is taken into account. It
will depend on the ongoing further examination of this question whether an explicit provision
in this sense is necessary in the Implementing Regulation.

13)

Annex XI (ad Article 60)

The  existing  Annex  VI  entries  in  respect  of  special  schemes  for  civil  servants  shall  be
maintained by Spain in Annex XI.

14)

Annex XI (ad Article 62 (1))

Ireland underlined that the agreement on this paragraph should not anticipate the outcome of
the discussions on Annex XI.

15)

Implementing Regulation (ad Article 87 (8))

Provisions  concerning  the  notification  to  the  previously  competent  institution  by  the  person
concerned  or  by  the  newly  competent  institution  shall  be  included  in  the  Implementing
Regulation.

The Council and the Commission further acknowledge that

16)

International agreements (ad Articles 11(3)(c) and 65(6) and (7))

The  agreement  of  Portugal  on  Articles  11  (3)(c)  and  65(6)  and  (7)  is  without  prejudice  to
Portugal’s request for fair treatment in the sharing of costs between Portugal and other States
which  are  not  members  of  the  European  Union,  in  the  context  of  the  agreements  to  be
negotiated following the adoption of the this Regulation.

The Council and the Commission also agree that the following articles should be interpreted
as follows:

16

 
17.

ad Article 20(2)

Without  prejudice  to  the  provisions  outlined  in  Article  20  (2),  Ireland  seeks  to  clarify  that
national criteria in addition to the ‘medically justifiable time limit’ referred to in the text of
Article 20 (2) can be applied by the Irish competent institutions when considering the referral
of patients to another Member State under the Regulation. Ireland does, however, fully agree
that  the  application  of  such  additional  national  criteria  must  be  in  accordance  with  the
provisions of Community Law.

18.

ad Article 35(2)

It  is  up  to  each  individual  Member  State  as  a  creditor  to  determine  whether  its  legal  or
administrative  structure  is  such  that  a  reimbursement  on  the  basis  of  actual  expenditure  is
appropriate  or  not.  This  determination  applies  vis-à-vis  all  Member  States  unless  other
methods of reimbursement have been mutually agreed according to paragraph 3.

19.

ad Article 84(2)

Article 84 (2) shall not be interpreted as imposing obligations on a Member State to do more
than is required or permitted according to national legislation or procedures."

17