Waldemar Hudzinski v Agentur für Arbeit Wesel — Familienkasse and Jaroslaw Wawrzyniak v Agentur für Arbeit Mönchengladbach — Familienkasse.
Date: 2012-06-12
41. That being so, it should be recalled that, according to settled case-law, the objective of the provisions of Title II of Regulation No 1408/71, which determine the legislation applicable to workers moving within the European Union, is to ensure, in particular, that the persons concerned are, in principle, subject to the social security scheme of only one Member State in order to prevent more than one system of national legislation from being applicable and to avoid the complications which may result from that situation. That principle is expressed, in particular, in Article 13(1) of Regulation No 1408/71 (see, inter alia, Case C-16/09 Schwemmer  [2010] ECR I-9717, paragraph 40 and the case-law cited.
42. Furthermore, since Article 48 TFEU provides for the coordination, and not the harmonisation, of the legislation of the Member States, substantive and procedural differences between the social security schemes of individual Member States, and hence in the rights of persons who are insured persons there, are unaffected by that provision, as each Member State retains the power to determine in its legislation, in compliance with EU law, the conditions pursuant to which benefits may be granted under a social security scheme (see, inter alia, Case C-388/09 da Silva Martins  [2011] ECR I-5737, paragraph 71 and the case-law cited).
43. In that context, the primary law of the European Union cannot guarantee to an insured person that moving to another Member State will be neutral in terms of social security. Thus, the application, possibly under the provisions of Regulation No 1408/71, following a change of Member State of residence, of national legislation that is less favourable as regards social security benefits may in principle be compatible with the requirements of primary EU law on freedom of movement for persons (see, inter alia, by analogy, da Silva Martins , paragraph 72).
45. Although the German authorities are thus not required under EU law to grant the child benefit at issue in the main proceedings, the question arises, however, as to whether that law precludes the potential grant of such benefits, especially because, as is clear from the file submitted to the Court, it appears that under German law the appellants in the main proceedings may receive that benefit solely because they are subject to unlimited income tax liability or treated as such, this being a matter for the referring court to ascertain.
46. In that regard, as the Court stated in paragraph 29 of Bosmann , the provisions of Regulation No 1408/71 must be interpreted in the light of Article 48 TFEU, which aims to facilitate freedom of movement for workers and entails, in particular, that migrant workers must not lose their right to social security benefits or have the amount of those benefits reduced because they have exercised the right to freedom of movement conferred on them by the Treaty.
47. Likewise, in paragraph 30 of that judgment, the Court held that the first recital in the preamble to Regulation No 1408/71 states that the provisions which that regulation contains for coordination of national social security legislations fall within the framework of freedom of movement for workers who are nationals of Member States and should contribute towards the improvement of their standard of living and conditions of employment.
48. It is in the light of those factors that the Court held, in paragraph 31 of Bosmann , that, in circumstances such as those of the case which gave rise to that judgment, the Member State of residence cannot be deprived of the right to grant child benefit to those who reside within its territory. While, under Article 13(2)(a) of Regulation No 1408/71, a person employed in the territory of one Member State is to be subject to the legislation of that State, even if he resides in the territory of another Member State, the fact remains that the purpose of that regulation is not to prevent the Member State of residence from granting child benefit to that person under its legislation.
49. The Court added, in paragraph 32 of that judgment, that the principle of the exclusive applicability of the legislation designated under the provisions of Title II of Regulation No 1408/71, set out in paragraph 41 of the present judgment, cannot serve as a basis for precluding a Member State, which is not the competent State but which does not subject the right to child benefit to conditions of employment or insurance, from being able to grant such a benefit to one of its residents since the possibility of such a grant arises, in actual fact, from its legislation.
52. Although the Court, in paragraph 29 of Bosmann , stated that migrant workers must not lose their right to social security benefits or have the amount of those benefits reduced because they have exercised the right to freedom of movement conferred on them by the Treaty, that statement is expressly formulated as an example of the possible implications of Article 48 TFEU and of the purpose of that provision for the interpretation of Regulation No 1408/71.
53. Furthermore, that statement, which must be understood in the light of the particular nature of the case in the main proceedings which gave rise to the Bosmann judgment, is of secondary importance in comparison with the principle, which is set out in the first place in that paragraph of the judgment and is settled case-law, according to which the provisions of Regulation No 1408/71 must be interpreted in the light of the purpose of Article 48 TFEU, which is to contribute to the establishment of the greatest possible freedom of movement for migrant workers (see, inter alia, da Silva Martins , paragraph 70 and the case-law cited).
56. The EU legislation on the coordination of national social security legislation, taking account in particular of its underlying objectives, cannot, except in the case of an express exception in conformity with those objectives, be applied in such a way as to deprive a migrant worker or those claiming under him of benefits granted solely by virtue of the legislation of a single Member State (see, inter alia, da Silva Martins , paragraph 75).
65. Finally, it is true that, in a situation such as that in Bosmann , the residence of the migrant worker and that of the child within the territory of the Member State which lacks competence were specific and particularly close connecting factors, particularly when account is taken of the nature of the benefit at issue.
66. In the present cases in the main proceedings, the connection of the situations at issue with the territory of the Member State which lacks competence and from which family benefits are claimed is the fact of subjection to unlimited income tax liability in respect of the income earned from the temporary work in that Member State. Such a connection is based on a precise criterion and may be regarded as being sufficiently close, when account is also taken of the fact that the family benefit claimed is financed by tax revenue.
67. In those circumstances, it does not appear that, in the situations in the main proceedings, the grant of that benefit, which is not subject to conditions of employment or insurance, is liable to affect disproportionately the predictability and effectiveness of the application of the coordination rules of Regulation No 1408/71, requirements relating to legal certainty which also protect the interests of migrant workers and to which the principle, set out in paragraph 41 of the present judgment, consisting in the exclusive applicability in principle of the legislation of the Member State designated under those rules as the competent State also contributes.
71. However, if, in a situation such as that at issue in the main proceedings, the legislation of a Member State which lacks competence provides for entitlement to a family benefit which confers additional social protection on the migrant worker by virtue of the fact that he was subject to unlimited income tax liability in that State or has been treated as such for the period in which he worked there, any rules against overlapping laid down by that legislation, such as those resulting from Paragraph 65 of the EStG, cannot be applied if the application thereof is found to be contrary to EU law.
73. It must, however, be held that the situation at issue in the main proceedings is not covered by that rule against overlapping or, moreover, by that laid down by Article 76 of Regulation No 1408/71 since it does not concern a hypothetical overlapping of entitlements laid down by the legislation of the Member State of residence of the child concerned and of those resulting from the legislation of the Member State of employment designated as the competent State under that regulation (see, to that effect, Bosmann , paragraph 24, and Schwemmer , paragraphs 43 and 51)
80. It is also clear from the case-law of the Court that Articles 45 TFEU to 48 TFEU, and Regulation No 1408/71, adopted to implement them, are intended in particular to prevent the situation in which a worker who has exercised his right of free movement is treated, without objective justification, less favourably than one who has completed his entire career in only one Member State (see, to that effect, da Silva Martins , paragraph 76 and the case-law cited).
81. Therefore, even if it can be explained by the disparities in the social security legislation of the Member States which subsist despite the existence of the coordinating rules laid down by EU law, the disadvantage mentioned in paragraph 76 of the present judgment is contrary to the requirements of the primary law of the European Union on the free movement of workers (see, inter alia, by analogy, da Silva Martins , paragraphs 72 and 73 and the case-law cited).
82. That finding cannot be called into question by the objective of Article 14(1)(a) of Regulation No 1408/71, which, according to the case-law of the Court, and as the referring court has stated, consists in encouraging the freedom to provide services by preventing an undertaking established in one Member State from being obliged to register its workers, who are normally subject to the social security legislation of that State, with the social security system of another Member State to which they are sent to perform work of short duration, which would complicate exercise by such an undertaking of that fundamental freedom (see, to that effect, inter alia, Case C-202/97 FTS  [2000] ECR I-883, paragraphs 28 and 29).