CELEX: 51988PC0027
Language: en
Date: 1988-02-02
Title: Proposal for a COUNCIL REGULATION (EEC) amending 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 (submitted by the Commission)

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COM (88) 27
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 ---pagebreak---  COMMISSION OF THE EUROPEAN COMMUNITIES
                                                        COM(88) 27 final
                                                        Brussels , 2 February 1988
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                                   Proposal for a
                              COUNCIL REGULATION ( EEC )
amending 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
                          ( submitted by the Commission )
 ---pagebreak---                                                                           W
                                  13 -
                           EXPLANATORY MEMORANDUM
concerning the proposal for a Council Regulation amending 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 .
                                                                                  7
                                                                                 ■L
 ---pagebreak---                                   14 -
INTRODUCTION
The payment of family benefits to family members residing in a Member State
other than the country of employment is governed by Articles 73 and 74 of
Régulation ( EEC ) No 1408 / 71 . These Articles do not provide for a uniform
System :
       Under Articles 73(1 ) and 74(1 ), where the country of employment or the
       country under the legislation of which unemployment benefits are
       provided is a "Member State other than France ", the family benefits
       payable in respect of the members of the family residing outside that
       country are those provided for by the legislation of the country where
       the person concerned is employed or unemployed ;
       Under Articles 73(2 ) and 74(2 ), where the country of employment or the
       country under the legislation of which unemployment benefits are
       provided is France and where the members of the family reside in another
       Member State family benefits are provided on the basis of the legis­
       lation of the country of residence .
This dual system is the result of a compromise without which the unanimity
required by Article 51 of the Treaty could not have been achieved for the
purposes of the adoption of Regulation ( EEC ) No 1408 / 71 .
It should be noted that the family benefits referred to in the aforementioned
Articles 73(1 ) and 74(1 ) do not comprise the special childbirth allowances ,
which are excluded from the scope of the Regulation by virtue of Article
l(u)(i ) and listed in Annex II- II-*- , housing allowances ^ and the family bene¬
fits which would be introduced in Luxembourg -^ after 1 October 1972 for demo¬
graphic reasons , pursuant to Article 90 .
Furthermore , family allowances for the children of pension holders and special
or supplementary family allowances for orphans are covered , in Chapter 8 of
the Regulation , by a special scheme , which also applies to increases in the
pensions of such holders and to orphans' pensions .
The dual system created by Articles 73 and 74 was intended to be only a
temporary one . Indeed , Article 99 of the Regulation provides that the Council
shall , on a proposal from the Commission , before 1 January 1973 , re-examine
the entire matter of the payment of family benefits to members of families who
are not residing in the country of employment , " in order to reach a uniform
solution for all Member States ."
This is the childbirth allowance in Belgium and Luxembourg ,           the  former
antenatal allowances and maternity allowances in France .
This allowance is paid only in France under legislation on family benefits .
These are antenatal allowances .
                                                                                   )
 ---pagebreak---                                    15
  In April 1975 a proposal from the Commission advocating that the "country of
 employment system" should be made general came before the Council ^, which ,
 after debating it on several occasions ^, never succeeded in achieving un¬
 animity on a uniform system of any kind , as the "country of residence system"
 received the support of several delegations .
 By a Judgment delivered on 15 January 1986 in Case 41 / 84 ( Pinna ) the Court of
 Justice rendered null and void Article 73(2 ) of Regulation ( EEC ) No 1408/ 71 .
 Broadly speaking , the Court of Justice deemed that the criterion of residence
 of members of the family was discriminatory and that its use was Incompatible
 with Articles 48 to 51 of the EEC Treaty :
 "More specifically with regard to the assessment of the validity of Article
  73(2 ) itself , it must be stated that the principle of equal treatment
 prohibits not only overt discrimination based on nationality but all covert
 forms of discrimination which , by applying other distinguishing criteria , in
 fact achieve the same result .
 That is precisely the case when the criterion set out in Article 73(2 ) is used
 in order to determine the legislation applicable to the family benefits of a
 migrant worker . Although as a general rule the French legislation employs the
 same criterion to determine the entitlement to family benefits of a French
 worker employed on French territory , that criterion is by no means equally
 important for that category of worker , since the problem of members of the
 family residing outside France arises essentially for migrant workers .
 Consequently , the criterion is not of such a nature as to secure the equal
 treatment laid down by Article 48 of the Treaty and therefore may not be
 employed within the context of the coordination of national legislation which
  is laid down in Article 51 of the Treaty with a view to promoting the free
 movement of workers within the Community in accordance with Article 48 .
  It follows that Article 73(2 ) of Regulation ( EEC ) No 1408/ 71 is invalid
  insofar as it precludes the award to employed persons subject to French
  legislation of French family benefits for members of their family residing in
  the territory of another Member State ."  ( Paragraphs 23 to 25 ).
10J No C96 , p. 4 .
  This solution received the support of the European Parliament ( Opinion of 14
  October 1975 , OJ No C257 , 10 November 1975 ) and of the Economic and Social
  Committee ( Opinion of 24 September 1975 , OJ No C286 , 15 December 1975 ).    An
  amendment to the proposal was passed to the Council in order to take account
  of the suggestions made by the latter institutions ( COM(75) 648 final ).
O
  At the meetings of 18 December 1975 , 4 December 1976 and 27 November 1980
  following a further communication dated 10 November 1980 from the Commission
  to the Council ( COM(80)703 final ) and after the European Parliament had
  recalled in a resolution voted unanimously on 17 June 1980 its choice of the
  country of employment formula , as well as during informal meetings of the
  Ministers of Social Security of 29 and 30 September 1983 and 7 November 1983 .
                                                                                    V-
 ---pagebreak---                                    Ib -
Article 74(2 ) of the Regulation , which lays down a rule identical to the one
laid down in Article 73(2 ) for unemployed persons subject to French legis ¬
lation must suffer the same fate ;        the same applies to their implementing
provisions contained in Article 75(2 ) of the basic Regulation and in Articles
87 and 89 of the implementing Regulation .
Moreover , the dual system itself created by Article 73 of the Regulation has
been criticized by the Court of Justice . The Court deemed that , although it
is true that Article 51 of the Treaty provides for coordination and not
harmonization of the legislation of the Member States , thereby leaving in
being differences between the Member States'        social security systems and ,
consequently , in the rights of workers employed in the Member States ( para¬
graph 20 ), "Nevertheless , the achievement of the objective of securing free
movement for workers within the Community , as provided for by Articles 48 to
51 of the Treaty , is facilitated if conditions of employment , including social
security rules , are as similar as possible in the various Member States . That
objective will , however , be imperilled and made more difficult to realise if
unnecessary differences in the social security rules are introduced by
Community law .     It follows that the Community rules on social security
introduced pursuant to Article 51 of the Treaty must refrain from adding to
the disparities which already stem from the absence of harmonization of
national legislation ."   ( Paragraph 21 ).
The alternatives of the " criterion of the country of employment " and the
"criterion of the country of residence ", which until recently divided the
national delegations within the Council no longer arises now in the same
terms . It is now established , in view of the Judgment , that the criterion of
the country of residence should be eliminated and that only a uniform system
would make it possible to attain the objectives set out in Articles 48 to 51
of the EEC Treaty .
It rests with the Council , whence the provision criticized by the Court
originates , to take appropriate measures to set to rights the declared in ¬
compatibility by means of an analogous application of Article 176 of the EEC
Treaty .
                                                            »
The criterion of the country of employment would not be open to the same
criticisms by the Court of Justice . Moreover , in the Commission 's opinion , in
accordance with the principle of practical interpretation , by laying down the
intratemporal limits at point 2 of the operative part of the Judgment , the
Court intended that Article 73(1 ) of the Regulation should be applied to
workers employed in France as from 15 January 1986 including appeals or
complaints lodged prior to that date , it being understood that the phrase
" other than France " appearing therein , and of necessity linked to the intro ¬
duction of the specific scheme organised by Article 73(2 ), which had been
declared null and void , no longer applies .
Admittedly , the Court of Justice in no way considered that only the country of
employment formula would make it possible to attain the objectives of the
Treaty . In February 1986 work began along these lines on standardising the
system of payment of family benefits in the Administrative Commission on
Social Security for Migrant Workers at the request of the Council Working
Party on Social Questions , without disregarding , of course , the 1975 proposal
for a regulation still pending before the Council . Several proposals , based
notably on the free choice of the person concerned of the legislation applic ¬
able and accompanied by a procedure for lump-sum reimbursement between
national institutions have been submitted , although , on account principally of
their complexity , they have failed to receive the unanimous approval of the
national delegations .
                                                                                  >
 ---pagebreak---                                     17
The country of employment formula which the Commission proposes for general
application at any rate guarantees equality of treatment among workers
occupied in the same country . It is imperative for reasons of simplicity
( avoiding the difficulties inherent in refund mechanisms and delays in the
settlement of accounts ), for reasons of fairness ( avoiding the considerable
losses for children staying behind in their country of origin whose legis ¬
lation often provides for lower benefits , in spite of the participation of
workers in the economy of the country of employment , by the payment of social
security contributions and taxes ) and , finally , for reasons connected with the
coherence of the system under Regulation No 1408 / 71 (which assigns precedence
to the lex loci laboris while only in cases where the nature of a worker 's
activity makes it impossible to identify a single law of the place of work he
is subject to the legal system with which he has the closest links , which in
general is the legislation of the country of residence ).
This solution could , however , not have the effect of depriving Member States
whose legislation makes the right to benefits solely conditional on the
residence of the members of the family within their territory and not to the
occupational activity of the parents , of the possibility of paying a supple ¬
ment equal to the difference between the amount of the benefits due under the
legislation of the Member State of employment .
Moreover , account being taken of the very specific nature of the housing
allowances provided for by French legislation and the considerable technical
difficulties involved in paying these allowances in other Member States , it
would be necessary with regard to these benefits to make an exception from the
principle of the exportability of family benefits .
The 1975 proposal for a regulation could not be maintained .     Technical adapt ¬
ations are essentially necessary because of the extension in 1982 of the scope
of the Regulations to self-employed persons .
It should be recalled that when the Regulations were extended to self-employed
persons and to the members of their families , through Regulation No 1390 / 81
( OJ L143 , 29 May 1981 , p. 1 ) no provisions were envisaged to extend Chapter 7
on family benefits to self-employed persons ^.      This means in effect that at
present a self-employed person occupied in a Member State whose children
reside in another Member State cannot derive from the Regulation any right to
receive family benefits under the legislation of the State of employment .
With the exception of Article 72 of the Regulation concerning aggregation of
periods of insurance , employment or self-employment to the completion of which
the acquisition of the right to benefits would under the legislation of the
competent State be subject .
 ---pagebreak---                                   Proposal for a
                            COUNCIL REGULATION ( EEC )
     amending 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
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the European Economic Community , and in
particular Articles 51 and 235 thereof ;
Having regard to the proposal from the Commission , prepared following consultation
with the Administrative Commission on Social Security for Migrant Workers ,
Having regard to the Opinion of the European Parliament ,
Having regard to the Opinion of the Economic and Social Committee ,
                                                                     1
Whereas under Article 99 of Council Regulation ( EEC ) No 1408/71 , as last amended
by Regulation ( EEC ) No 3811 /862, the entire matter of the payment of family benefits
to members of the family who do not reside in the competent State must be
re-examined in order to reach a uniform solution for all Member States ;
Whereas by its Judgment of 15 January 1986 in Case 41 / 84 ( Pinna ), the Court of
Justice declared null and void Article 73(2 ) of Regulation ( EEC ) No 1408 /71 on the
ground that the criterion of residence of the members of the family of the migrant
worker , which it employs in order to determine the legislation applicable to the
family benefits payable to the worker , " is not of such a nature as to secure the
equal treatment laid down by Article 48 of the Treaty and therefore may not be
employed within the context of the coordination of national legislation which is
laid down in Article 51 of the Treaty with a view to promoting the free movement
of workers within the Community in accordance with Article 48";
Whereas , consequently , it is appropriate to disregard the criterion of residence of
the members of the worker 's family for the purposes of granting family benefits ;
Whereas , on the other hand , the criterion of employment adopted in Articles 73(1 )
and 74(1 ) of Regulation ( EEC ) No 1408 / 71 ensures equal treatment as between all
workers subject to the same legislation; whereas the choice of this factor of
attachment is necessary for reasons of simplicity, fairness and for reasons allied
to the coherence of the system of Regulation ( EEC ) No 1408/71 , which , generally
speaking , accords priority to the lex loci laboris ( law of the place of work ) for
the purpose of determining the legislation applicable ;
1 0J No L 149,  5.7.1971 , p. 2 .
20J No L 355,   16.12.1986, p. 5 .
 ---pagebreak---                                       - 2 -
 Whereas it is therefore appropriate to apply this solution also to workers
 subject to French legislation; whereas it is necessary to amend along these
 lines Regulations ( EEC ) No 1408/71 and No 574/72 1 , as last amended by
 Regulation ( EEC ) No 3811 /86; whereas the absence of a uniform solution as
 referred to in Article 99 of Regulation ( EEC ) No 1408/71 at the time of the
extension of the categories of persons covered by Regulations ( EEC ) No 1408/ 71
and No 574/72 to include self-employed workers and members of their families ,
prevented the same extension being made in the case of Articles 73 to 76 of
Regulation ( EEC ) No 1408 /71 ; whereas it is now appropriate to extend the
provisions to cover self-employed workers and to adapt accordingly the
provisions of Regulation ( EEC ) No 574 /72 ,
HAS ADOPTED THIS REGULATION :
Article 1
Regulation ( EEC ) No 1408 / 71 is hereby amended as follows :
1 . The heading of Chapter 7 of Title III is replaced by the following :
      " FAMILY BENEFITS "
2 . Articles 72 to 75 inclusive are replaced by the following :
    " Article 72
    Aggregation of periods of insurance , employment or self-employment
    Where the legislation of a Member State makes acquisition of the right to
    benefits conditional upon completion of periods of insurance , employment
    or self-employment , the competent institution of that State shall take into
    account for thus purpose , to the extent necessary , periods of insurance ,
    employment or self-employment completed in any other Member State , as if
    they were periods completed under the legislation which it administers .
    Article 73                                '
    Employed or self-employed persons the members of whose families reside in
    a Member State other than the competent State
    An employed or self-employed person subject to the legislation of a Member
    State shall be entitled , in respect of the members of his family who are
    residing in another Member State , to the family benefits provided for by
    the legislation of the former State , as if they were residing in that State ,
    subject to the provisions of Annex VI .
   Article 74
   Unemployed persons the members of whose families reside in a Member State other
   than the competent State
   An unemployed person who was formerly employed or self-employed and who draws
   unemployment benefits under the legislation of a Member State shall be entitled ,
   in respect of the members of his family residing in another Member State , to
   the family benefits provided for by the legislation of the former State , as if
   they were residing in that State , subject to the provisions of Annex VI .
 0J No L 74 , 27.3.1972 , p. 1 .
 ---pagebreak---                                     - 3 -
   Artide 75
   Provision of benefits
   1.   Family benefits shall be provided , in the cases referred to in Article 73,
   by the competent institution of the State to the legislation of which the
   employed or self-employed person is subject and , in the cases referred to in
   Article 74 , by the competent institution of the State under the legislation of
   which an unemployed person who was formerly employed or self-employed receives
   unemployment benefits . They shall be provided in accordance with the provisions
   administered by such institutions , whether or not the natural or legal person to
   whom such benefits are payable is residing or staying in the competent State or
   in another Member State .
   2 . However , if the family benefits are not used by the person to whom they
   should be provided for the maintenance of the members of his family , the
   competent institution shall discharge its legal obligations by providing the
   said benefits to the natural or legal person who is actually maintaining the
   members of the family , at the request of and through the agency of the
   institution of their place of residence or of the designated institution or
   body appointed for this purpose by the competent authority of their country of
   residence ;
   3 . Two or more Member States may agree , in accordance with the provisions of
   Article 8 , that the competent institution shall provide the family benefits
   payable under the legislation of those States or of one of those States to the
   natural or legal person who is actually maintaining the members of the family ,
   either directly or through the agency of the institution of their place of
   residence ."
3. Article 90 is deleted .
4. Article 94(9 ) is replaced by the following :
   "9 . The family allowances received by frontier workers employed in France in
   respect of the members of their families residing in another Member State on
   the day preceding the entry into force of Regulation ( EEC ) No . shall
   continue to be paid at the expense of the French competent institution at the
   rates , within the limits and according to the procedures applicable on that
   date as long as their amount exceeds that of the benefits that would be due
   after the entry into force of Regulation ( EEC ) No . and as long as the
   persons concerned are subject to French legislation . Account shall not be
   taken of interruptions lasting less than one month , nor of periods during which
   unemployment or sickness benefit is drawn .
   The procedure for implementing this paragraph shall be determined by mutual
   agreement between the Member States concerned or by their competent authorities ,
   after the Administrative Commission has delivered an opinion ."
                                                                                    9
 ---pagebreak---                                                                                           I
                                          - 4 -
   5.   Article 99 is deleted .
   6.   Annex II , Part II is amended as follows :
        Ca ) the text appearing at E. FRANCE is replaced by the following text :
              "The allowance for young children provided without a means text ."
        ( b ) the text appearing at I. LUXEMBOURG is replaced by the following text :
                                                  • 4
              "( a )  Antenatal allowances
                (b)   Childbirth allowances ."
   7.   In Annex VI , E. FRANCE
        ( a ) paragraph 4 is replaced by the following :
              " 4 . A person who is subject to French legislation pursuant to the
              provisions of Article 14(1 ) or Article 14a(1 ) shall be entitled , in
              respect of the members of his family accompanying him on the territory
              of the Member State in which he is pursuing an occupation , to the
              following family benefits :
              (a)    The allowance for young children provided for by Article L 515
                     of the Social Security Code for the period during which this
                     allowance is paid subject to a means test ;
              (b)     the family allowances provided for in Articles L 524 and
                      L 531 of the Social Security Code ."
      (b)     The following paragraph 7 is added :
              " 7 . Notwithstanding the provisions of Articles 73 and 74 of the
                      Regulation , the housing allowance referred to in Article
                      510(5 ) of the Social Security Code , the housing allowances
                      financed by the National Housing Assistance Fund and the
                      removal grants introduced by Article 16(h ) of the Law of
                      22 August 1946 shall be granted only to persons concerned
                      residing on French territory ."
Article 2
Regulation ( EEC ) No 574 / 72 is hereby amended as follows :
1.    Article 10a is replaced by the following :
      " Article 10a
      Rules applicable where an employed or self-employed person is subject
      successively to the legislation of several Member States during the same
      period or part of a period
                                                                                     .1 6
 ---pagebreak---     Where an employed or self-employed person has been subject successively
    to the legislation of two Member States during the period separating two
    dates for the payment of family benefits as provided for by the legis ¬
    lation of one or both of the Member States concerned , the following
    rules shall apply :
    (a)    the family benefits which the person concerned may claim by virtue
           of being subject to the legislation of each one of these States
           shall correspond to the number of daily benefits due under the
           relevant legislation . Where such legislation does not provide for
           daily benefits , the family benefits shall be granted in proportion
           to the length of time during which the person concerned has been
           subject to the legislation of each one of the Member States in
           relation to the period fixed by the legislation concerned ;
    (b)    where the family benefits have been provided by an institution
           during a period when they should have been provided by another
           institution , there shall be an adjustment of accounts between the
           said institutions ;
    (c )   for the purposes of subparagraphs ( a ) and ( b ), where periods of
           employment or self-employment completed under the legislation of
           one Member State are expressed in units different from those which
           are used for the calculation of family benefits under the legis ¬
           lation of another Member State to which the person concerned has
           also been subject during the same period , the conversion shall be
           carried out in accordance with the provisions of Article 15(3 ) of
           the implementing Regulation ;
    (d )   notwithstanding the provisions of subparagraph ( a ), in respect of
           dealings between the Member States listed in Annex 8 to the
           implementing Regulation , the institution bearing the costs of the
           family benefits by reason of the first employment or self -
           employment during the period concerned shall bear such costs
           throughout the entire current period ."
2. The heading of Chapter 7 of Title IV is replaced by the following :
   " FAMILY BENEFITS "
3. In Article 86 :
   (a)    the title preceding Article 86 is replaced by the following :
          " Implementation of Article 73 and Article 75(1 ) and ( 2 ) of the
          Regulation"
   (b)    the title under Article 86 is deleted .
   (c )   paragraph 4 is replaced by the following :
          "4 .   The competent authorities of two or more Member States may
                 agree on special procedures for the payment of family
                 benefits , in particular with a view to facilitating the
                 implementation of Article 75(1 ) and ( 2 ) of the Regulation .
                 Such agreements shall be communicated to the Administrative
                 Commission ."
4.  Article 87   is deleted .
                                                                                Ή
 ---pagebreak---                                        - 6 -
5.    Article 88 is replaced by the following :
      " Implementation of Article 74 of the Regulation
      Article 88
      The provisions of Article 86 of the Implementing Regulation shall apply
      by analogy to unemployed persons who were formerly employed or self-
      employed and who are covered by Article 74 of the Regulation ."
6.    Article 89 is deleted .
 7.   Article 98 and the title preceding It are deleted .
8.    Article 101(1 ) is replaced by the following ;
      " 1 . Pursuant to Articles 36 , 63 and 70 of the Regulation , the Admin ¬
             istrative Commission shall draw up a statement of claims            In
             respect of each calendar year ."
9.    Article 102(2 ) is replaced by the following :
      "2 .   The reimbursements provided for In Articles 36 , 63 and 70 of the
             Regulation shall be made       for all the competent institutions of a
             Member State to the creditor institutions of another Member State
             through the agency of the bodies designated          by  the competent
             authorities    of  the    Member   States . The  bodies  through which
             reimbursements have been made shall advise the Administrative
             Commission of the amounts reimbursed within the time limits and
             according to the procedures laid down by the said Commission ."
10 .  Article 104(2 ) is replaced by the following :
      "2 .  Provisions which are similar to those referred to in paragraph 1
            and which , for the purposes of dealings between two or more Member
            States , will apply following the entry into force of the Regulation
            shall be entered in Annex 5 to the implementing Regulation .     The
            same shall apply to provisions agreed under Article 97(2 ) of the
            implementing Regulation ."
 11 . Article 120 is deleted .
12 .  In Annex 2 , E. FRANCE,
      ( a ) paragraph 3 is deleted ;
      ( b ) paragraph 4 becomes paragraph 3 .
13 .  Annex 10 is amended as follows :
      (a ) in A. BELGIUM, subparagraph 6(d ) is deleted ;
      (b ) in B. DENMARK, subparagraph 6(a ) is replaced by the following :
            "(a ) reimbursements pursuant to Article 36 and Article 63 of the
                   Regulation :   ( no change )";
      ( c ) in C. GERMANY , paragraph 8 is replaced by the following :
            "8 .   For the purposes of applying Articles 36 and 63 of the Regulation
                   and Article 102(2) of the implementing Regulation (no change )";
                                                                                     A
 ---pagebreak---       (d)  in E. FRANCE
               ( i ) Paragraph 8 is deleted ;
             ( ii ) Paragraphs 9 and 10 become paragraphs 8 and 9 respectively ;
           ( iii ) Paragraph 8 ( new ) is replaced by the following :
                     "8 .  For the purposes of applying jointly Articles 36 and
                           63 of the Regulation and Article 102(2 ) of the imple¬
                           menting Regulation : ( no change )";
      (e)  in G. IRELAND , subparagraph 3(b ) is replaced by the following :
           "( b ) For the purposes of applying Article 70 of the Regulation
                     and Article 102(2) of the implementing Regulation : ( no change )";
      (f)  in H. ITALY
               ( i ) Paragraph 5 is deleted ;
             ( ii ) Paragraphs 6 , 7 and 8 become paragraphs 5 , 6 and 7 respectively ;
           ( iii ) Subparagraph 6(c ) ( new ) is replaced by the following :
                     "c .  Reimbursements under Article 70 of the Regulation
                           ( no change )";
      (g)  in I. LUXEMBOURG , subparagraph 8(d ) is deleted;
      ( h) in J . NETHERLANDS , subparagraph 4(c ) is deleted .
Article 3
This Regulation shall enter into force on the day following its publication in
the Official Journal of the European Communities .
It shall apply with                  effect from 15 January 1986 .
This Regulation shall be binding in its entirety and directly applicable in all
Member States .
Done at                                                      For the Council
                                                              The President
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                   ANALYSIS OF THE PROPOSAL FOR A REGULATION
Article 1
Paragraph 1
The new title of Chapter 7 results from the standardization of the system for
paying family benefits .
Paragraph 2
The paragraph extends Articles 73 to 75 of the Regulation to self-employed
persons the members of whose families reside in a Member State other than the
competent State .
Articles 73 and 74 of Regulation No 1408 / 71 now lay down the right to the
family benefits of the country of employment for all workers and unemployed
persons whose families reside in another Member State . This right extends to
all family benefits with the exception of the housing allowance ( cf . para 7(b )
below ).                              k-
The provisions of Article 73(2 ) which provided for a different scheme for
workers and unemployed persons subject to French legislation have therefore
been deleted .
Because of the deletion of Article            73(2 ) the provision of paragraph       3
referring also to the application of           French legislation alone has       to be
transferred to Annex VI- E- France - 4 ( cf . Article 1(7 ) ( a ) of the proposal for a
regulation ) .
In Article 75(1 ) of Regulation No 1408 / 71 the references to Articles 73 and 74
have been adjusted to take account of the amendments made to these Articles .
Moreover , the deletion of Articles 73(2 ) and 74(2 ) has rendered inoperative
the provisions of Article 75(2 ) which fixed the rules relating to the
provision of family allowances to members of the families of workers and
unemployed persons subject to French legislation , and to the reimbursement
proc edure .
Paragraph 3
The provision of Article 90 has become superfluous because
(i)     housing allowances are regarded as family benefits under French legis ¬
        lation only and the relevant qualifying conditions are now contained in
        Annex VI- E-France ;
 ( ii ) the only family benefits serving demographic purposes introduced in
        Luxembourg since the entry into force of Regulation No 1408/ 71 are the
        prenatal allowances and it has been deemed preferable to mention them in
        Annex II - II - I.
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Paragraph 4
This transitional provision is intended to maintain the present level of
benefits received by certain frontier workers occupied in France whose
families reside in another Member State so long as the French benefits ( to be
provided in accordance with the general rule on the export of the benefits of
the country to whose legislation the worker is subject ) are below this level .
Paragraph 5
Article 99 ( formerly Article 98 ) of Regulation No 1408/ 71 has become in ¬
operative .
Paragraph 6
The allowance for young children introduced by Law No 85-17 of 4 January 1985
relating to measures for young and large families merges into one single
monthly benefit the various benefits previously provided in respect of
pregnancy and childbirth ( prenatal and postnatal allowances , family supplement
for a child under the age of three ). The new benefit is not means-tested
during pregnancy and until the third month following delivery 1 .       It should
therefore be entered in Annex II-II to the Regulation .
The prenatal allowances introduced in Luxembourg by the Law of 17 April 1974
form part of the special childbirth allowances excluded from the scope of
Regulation No 1408 / 71 under its Article       l(u)(i ) and should therefore be
specified in Annex II to that Regulation .
Paragraph 7(a )
Cf . Article 1(1 ) above .
Paragraph 7(b )
The new paragraph 7 to be added to Annex VI- E- France constitutes an exception
to the principle of the export of the family benefits of the competent
country .    This exception concerns the housing allowances provided for by
French legislation . On the one hand these are benefits serving a specific
purpose as they are used as an instrument of housing policy .        On the other
hand their qualifying conditions connected with the quality and cost of
dwellings are closely linked with housing conditions obtaining in France and
could therefore prove inappropriate to the housing situation in another Member
State . Their application in another Member State would , furthermore , entail
considerable difficulties from an administrative angle .
Article 2
Paragraph 1
The aim of this paragraph is formally to delete from Article 10a of Regulation
No 574 / 72 the words " family allowances " which have lost their relevance since
the standardization of the system of paying family benefits .
From the third month to the age of three years this benefit is subject to a
means test and is as such a family benefit covered by the Regulation .
                                                                                 / J
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Paragraphs 2 , 3 , 4 and 5
The procedure for implementing Articles 73(2 ) and 74(2 ) of Regulation No
1408 / 71 provided for by Articles 87 and 89 have become inoperative .
The other provisions or headings of Chapter 7 of Title IV have been adapted
accord ingly .
Paragraphs 6 , 7 , 8 and 9
Article 98 laying down the procedure for refunding family allowances provided
to the families of workers or unemployed persons subject to French legislation
pursuant to Articles 73(2 ) and 74(2 ) of Regulation No 1408/ 71 has become
inoperative .
The other provisions of Title V have been adapted accordingly .
Paragraph 10
The procedure for implementing Article 94(9 ) of Regulation No 1408/ 71 has
become inoperative because of the deletion of the said paragraph 9 .
Paragraph 11
In Annexes 2 and 10 to Regulation No 574/ 72 the references to the provisions
of Regulations Nos 1408 / 71 and 574/ 72 that have been deleted by this proposal
have likewise been deleted .
Article 3
In accordance with the Judgment delivered in Case 41 / 84 ( Pinna ) this Reg ¬
ulation is made applicable with retrospective effect as from the date of that
Judgment , i.e. 15 January 1986 .
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