1 By an order of 28 January 1999, received at the Court on 8 February 1999, the Arrondissementsrechtbank te Amsterdam (District Court, Amsterdam) referred to the Court for a preliminary ruling under Article 177 of the EC Treaty (now Article 234 EC) four questions concerning the interpretation of Article 41 of the Cooperation Agreement between the European Economic Community and the Kingdom of Morocco, signed at Rabat on 27 April 1976 and approved on behalf of the Community by Council Regulation (EEC) No 2211/78 of 26 September 1978 (OJ 1978 L 264, p. 1, hereinafter the Cooperation Agreement or the Agreement), Article 3 of Regulation (EEC) No 1408/71 of the Council 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, as amended and updated by Council Regulation (EEC) No 2001/83 (OJ 1983 L 230, p. 6), as amended by Council Regulation (EEC) No 1247/92 of 30 April 1992 (OJ 1992 L 136, p. 1) (hereinafter Regulation No 1408/71), Article 7 of Regulation (EEC) No 1612/68 of the Council of 15 October 1968 on freedom of movement for workers within the Community (OJ English Special Edition 1968 (II), p. 475), and Articles 48 and 52 of the EC Treaty (now, after amendment, Articles 39 EC and 43 EC).
2 The first two questions, which concern the interpretation of Article 41 of the Cooperation Agreement, were raised in proceedings between Mr Fahmi, who is of Moroccan nationality, and the Bestuur van de Sociale Verzekeringsbank (Board of the Social Insurance Bank) (hereinafter the SVB) concerning the latter's refusal to grant him a dependent child's allowance for the fourth quarter of 1996.
3 The third and fourth questions, which concern the interpretation of Article 3 of Regulation No 1408/71, Article 7(1) of Regulation No 1612/68 and Articles 48 and 52 of the Treaty, were raised in proceedings between Mrs Esmoris Cerdeiro-Pinedo Amado, who is of Spanish nationality, and the SVB concerning the latter's refusal to grant her a dependent child's allowance for the fourth quarter of 1996 and the first quarter of 1997. Legal framework Community law
4 Article 41 of the Cooperation Agreement provides: 1. Subject to the provisions of the following paragraphs, workers of Moroccan nationality and any members of their families living with them shall enjoy, in the field of social security, treatment free from any discrimination based on nationality in relation to nationals of the Member States in which they are employed. ... 3. The workers in question shall receive family allowances for members of their families who are resident in the Community. 4. The workers in question shall be able to transfer freely to Morocco, at the rates applied by virtue of the law of the debtor Member State or States, any pensions or annuities in respect of old age, death, industrial accident or occupational disease, or of invalidity resulting from industrial accident or occupational disease. ...
5 Article 1 of Regulation No 1408/71 provides: For the purposes of the application of this Regulation: ... (u) (i) "family benefits" means all benefits in kind or in cash intended to meet family expenses under the legislation provided for in Article 4(1)(h), excluding the special childbirth allowances mentioned in Annex II; (ii) "family allowances" means periodical cash benefits granted exclusively by reference to the number and, where appropriate, the age of members of the family.
6 Article 3(1) of Regulation No 1408/71 provides: Subject to the special provisions of this Regulation, persons resident in the territory of one of the Member States to whom this Regulation applies shall be subject to the same obligations and enjoy the same benefits under the legislation of any Member State as the nationals of that State.
7 Article 77 of Regulation No 1408/71, entitled Dependent children of pensioners, provides: 1. The term "benefits", for the purposes of this Article, shall mean family allowances for persons receiving pensions for old age, invalidity or an accident at work or occupational disease, and increases or supplements to such pensions in respect of the children of such pensioners, with the exception of supplements granted under insurance schemes for accidents at work and occupational diseases. 2. Benefits shall be granted in accordance with the following rules, irrespective of the Member State in whose territory the pensioner or the children are residing: (a) to a pensioner who draws a pension under the legislation of one Member State only, in accordance with the legislation of the Member State responsible for the pension; ....
8 Article 7(1) and (2) of Regulation No 1612/68 provides: 1. A worker who is a national of a Member State may not, in the territory of another Member State, be treated differently from national workers by reason of his nationality in respect of any conditions of employment and work, in particular as regards remuneration, dismissal, and, should he become unemployed, reinstatement or re-employment; 2. He shall enjoy the same social and tax advantages as national workers. National legislation
9 Before 1 October 1986, a person insured under the Algemene Kinderbijslagwet (General Law on Dependent Children's Allowances, hereinafter the AKW) of 19 December 1962 was entitled to a dependent child's allowance as provided for in Article 7(1) of the AKW, which was worded as follows: In accordance with the provisions of this Law, an insured is entitled to a dependent child's allowance for children, whether born of his marriage, born of a previous marriage or adopted, who are dependent on or maintained by the insured, provided that such children: ... (c) are aged 16 years or over but have not yet reached the age of 27 years and devote the main part of the time which they might devote to work to studies or related activities or to occupational training or related activities and that the insured is largely responsible for maintaining them.
10 From 1 October 1986, Article 7(1) of the AKW was amended by the Wet op de studiefinanciering (Law on Study Finance, hereinafter the WSF) of 24 April 1986. The age limit of 27 years for entitlement to the dependent child's allowance was replaced by an age limit of 18 years. Under the WSF, students between the ages of 18 and 27 years would themselves be entitled to study finance. This new funding arrangement was designed, in particular, to enable students to be financially independent of their parents, to ensure equal treatment for students at various levels of education and to enhance the status of students.
11 The new Article 7(1) of the AKW provided that an insured was entitled to a dependent child's allowance: ... For a child born of his own marriage, a child born of a previous marriage or an adopted child, who (a) has not yet reached the age of 16 years and is part of his household, or (b) has not yet reached the age of 18 years and is dependent on the insured to a significant degree.
12 However, the new arrangements introduced by the AKW did not become fully applicable with immediate effect. For children born before 1 October 1986, the WSF initially, and then Chapter 4 of the AKW, had established a transitional arrangement under which entitlement to the dependent child's allowance was maintained for children aged between 18 and 27 years who were pursuing studies.
13 That transitional arrangement was amended with effect from 1 January 1996 by the Law of 21 December 1995. Since that date, under a new transitional arrangement, the entitlement to the dependent child's allowance provided for in the AKW has been maintained only for student children aged 18 years and over who were already entitled to the allowance, provided that they continued to follow the same type of education as they were following on 1 October 1995.
14 Under Article 7 of the WSF, that Law applies to, and the finance available thereunder benefits: (a) students who possess Netherlands nationality; (b) students who do not possess Netherlands nationality but are resident in the Netherlands and are treated as Netherlands nationals in respect of the financing of studies under agreements with other States or a decision of an organisation of public international law which is binding on the Netherlands; ....
15 The finance provided for in the WSF consists of a basic grant, the level of which is independent of the parents' income and the same for all students receiving a particular type of education, and a supplementary grant, the level of which varies according to parental income.
16 As a general rule, with the exception of certain foreign institutions which are treated as Netherlands institutions for the purpose of applying the WSF, only studies pursued in a Netherlands institution give rise to an entitlement to study finance. The main proceedings
17 After working in the Netherlands, Mr Fahmi and Mrs Esmoris Cerdeiro-Pinedo Amado both became unfit for work. They then returned to Morocco and Spain respectively and continued to receive an allowance for incapacity for work. By virtue of that allowance, each was entitled to allowances under the AKW for his or her dependent child.
18 However, the SVB refused to pay those allowances to Mr Fahmi and to Mrs Esmoris Cerdeiro-Pinedo Amado, in Mr Fahmi's case for the fourth quarter of 1996 and in Mrs Esmoris Cerdeiro-Pinedo Amado's case for the same quarter and also for the first quarter of 1997. It did so on the ground that at the material time their children had already reached the age of 18 years and no longer satisfied the conditions of the transitional arrangement which had been in force since 1 January 1996. Having completed their secondary education in 1995/96, in Morocco and Spain respectively, Mr Fahmi's son and Mrs Esmoris Cerdeiro-Pinedo Amado's daughter had both commenced a course of higher education in 1996/97.
19 Mr Fahmi and Mrs Esmoris Cerdeiro-Pinedo Amado lodged complaints against the SVB's decision refusing to pay the allowance. The SVB made a determination in respect of those complaints on 26 March and 7 May 1997 respectively and declared them unfounded. Mr Fahmi and Mrs Esmoris Cerdeiro-Pinedo Amado appealed against those decisions before the Arrondissementsrechtbank te Amsterdam.
20 The Arrondissementsrechtbank te Amsterdam considers that the amendment of the AKW upon the entry into force of the WSF and the nationality and residence criteria applied to students on the basis of the WSF introduced a distinction based on nationality. It considers that that distinction also affects those insured under the AKW themselves, since, first, the overwhelming majority of the non-Netherlands children of those insured are children of non-Netherlands parents and, second, children of persons insured under the AKW who study abroad are for the main part children whose parents themselves live outside the Netherlands. According to the national court, the aims of the study finance provided for in the WSF are such that a distinction of this nature cannot be justified.
21 The Arrondissementsrechtbank te Amsterdam considered that the disputes before it required an interpretation of Community law. It therefore decided to stay proceedings and to refer the following questions to the Court for a preliminary ruling: in Mr Fahmi's case: 1. (a) Must Article 41(1) of the Cooperation Agreement be interpreted as meaning that a Moroccan worker may rely on the prohibition of discrimination laid down in that provision if he no longer resides on the territory of a Member State of the European Community? (b) If so, does Article 41(3) of the Cooperation Agreement preclude reliance on Article 41(1) thereof by a Moroccan worker whose children reside outside the Community? 2. If a worker such as the plaintiff may rely on the prohibition of discrimination laid down in Article 41(1) of the Cooperation Agreement, does that prohibition have the effect of rendering the abolition of the entitlement to receive child allowance impermissible if the effect of that abolition is such that that right is replaced by (a different) entitlement to receive a contribution to (inter alia) the cost of maintaining student children aged 18 or over which far more frequently benefits Netherlands nationals or persons insured under the AKW who reside in the Netherlands than workers such as the plaintiff? in Mrs Esmoris Cerdeiro-Pinedo Amado's case: 1. (a) Does Article 3 of Regulation No 1408/71, or any other provision of that regulation, preclude the abolition of the right to child allowance for student children over the age of 18 if eligibility for the entitlement which replaces that right is in principle enjoyed only by students who are Netherlands nationals and who are pursuing their studies in the Netherlands? (b) Must Article 7(1) of Regulation No 1612/68 be interpreted as precluding the abolition of the right to child allowance for student children over the age of 18 if eligibility for the entitlement which replaces that right is in principle enjoyed only by students who are Netherlands nationals and who are pursuing their studies in the Netherlands? 2. Must Article 48 or Article 52 of the EEC Treaty be interpreted as meaning that the restriction of entitlement to receive from the national authorities a contribution to the cost of maintaining student children aged 18 or over results, for nationals of Member States other than the Netherlands who move to the Netherlands or for the children of such nationals, in an obstacle to freedom of movement for workers, or to freedom of establishment, which is such as to render that restriction incompatible with those articles? Purpose and admissibility of the questions
22 By those questions the national court is essentially seeking to ascertain whether the various provisions of Community law to which it refers are to be interpreted as meaning that they do not permit a right to a dependent child's allowance, such as that guaranteed by the AKW, to be abolished in respect of students aged between 18 and 27 years and replaced by a right to study finance, which is granted directly to those children and generally available only to those having the nationality of the Member State concerned or residing in that State and attending an institution there, where the effect of such an amendment is to deprive persons in the plaintiffs' situation of the allowance guaranteed under the original legislation without conferring on their children the right to the finance provided for in the new legislation.
23 The national court thus seems to suggest that, rather than examine separately the compatibility of the AKW and the WSF with Community law, the Court should in reality compare the entire two-stage legislative process comprising the partial repeal of existing rules and the adoption of new rules in their stead with the requirements of Community law.
24 It must be pointed out, however, that the mere fact that the two legislative amendments in question form part of a comprehensive reform of the national arrangements for study finance cannot itself, in the absence of special circumstances, suffice to justify combining the two sets of rules for the purpose of examining their compatibility with Community law.
25 The Member States are free to organise their social security systems, in particular by determining the conditions for entitlement to benefits, provided that they do not infringe Community law when exercising that power (see, in particular, Case 1/78 Kenny [1978] ECR 1489, paragraph 16; Case 110/79 Coonan [1980] ECR 1445, paragraph 12; and Case C-120/95 Decker [1998] ECR I-1831, paragraphs 21 to 23).
26 The rules on freedom of movement for workers within the Community referred to by the national court and the Cooperation Agreement must therefore be interpreted separately, in the light of each of the two national laws.
27 As regards the AKW, as the Advocate General observes at point 27 of his Opinion, the gradual abolition of the dependent child allowance by that law in respect of students aged between 18 and 27 years, without regard to their nationality, does not as such disclose any infringement of the rules on freedom of movement for workers within the Community to which the national court refers, or of the Cooperation Agreement.
28 As regards, moreover, the fact that the national court may not have jurisdiction to make a determination concerning the WSF, or the fact that the action pending before it was brought on the basis of the AKW alone, and the doubts expressed in relation to those facts by the Commission and the Netherlands Government respectively, it should be borne in mind that, in accordance with settled case-law, it is solely for the national court before which the dispute has been brought, and which must assume responsibility for the subsequent judicial decision, to determine in the light of the particular circumstances of the case both the need for a preliminary ruling in order to enable it to deliver judgment and the relevance of the questions which it submits to the Court (see, inter alia, Case C-302/98 Sehrer [2000] ECR I-4585, paragraph 20).
29 In the cases before the national court, it is by no means obvious that, in so far as it concerns the WSF rather than the AKW, the interpretation of Community law sought by that court bears no relation to the purpose or facts of the main action or is likely to have no effect on the outcome of the proceedings, so that there is no need to reject the requests made by the national court (see, in that regard, inter alia, Case C-355/97 Beck and Bergdorf [1999] ECR I-4977, paragraph 22, and Case C-448/98 Guimont [2000] ECR I-10663, paragraph 22).
30 In the light of the foregoing, the answer for the national court must be that neither the Cooperation Agreement nor Article 48 of the Treaty, nor Regulations No 1408/71 and No 1612/68, may be interpreted as meaning that they prevent a Member State from gradually abolishing an allowance for dependent children aged between 18 and 27 years pursuing studies provided that, as in the case of the legislation at issue in the main proceedings, its abolition does not involve discrimination based on nationality.
31 As regards the arrangement for study finance introduced by the WSF, the questions referred to the Court must be examined separately according to whether they relate to a situation such as Mrs Esmoris Cerdeiro-Pinedo Amado's or Mr Fahmi's. The questions in Mrs Esmoris Cerdeiro-Pinedo Amado's case Question 1(a)
32 By Question 1(a), the national court is asking essentially whether Article 3 of Regulation No 1408/71 or any other provision of that regulation must be interpreted as meaning that that regulation prevents the application of national legislation which limits study finance solely to national students or to those treated as national students by virtue of their residence on the territory of the Member State which has introduced that finance, both categories, moreover, being required in principle to be studying in an institution on that territory, where it follows from those conditions that the children of a person in a situation such as the plaintiff's are not eligible for that finance.
33 In order to answer the question as thus reformulated, it should be noted, first, that the Court has previously held that Article 77 of Regulation No 1408/71 gives a person entitled to a pension or a benefit payable under the legislation of a single Member State, residing in the territory of another Member State, entitlement only to family allowances, to the exclusion of other family benefits (Case 313/86 Lenoir [1988] ECR 5391, paragraphs 10 and 11).
34 Second, it should be emphasised that the specific purpose of Article 77 is to define the conditions in which a person in receipt of a pension may claim a dependent child's allowance from a Member State under whose legislation he receives a pension and that that provision expressly restricts its scope to family allowances. In those circumstances, neither the rule prohibiting discrimination on the basis of nationality laid down in Article 3(1) of Regulation No 1408/71 nor any other provision of that regulation can be interpreted as meaning that it enables the recipient of a pension who resides outside the territory of the paying Member State to obtain from that Member State dependent child allowances other than family allowances.
35 It follows that, without its being necessary to determine whether the study finance introduced by the WSF may be classified as a family benefit within the meaning of Article 1(u)(i) of Regulation No 1408/71, it is sufficient in the present case to observe that that finance cannot be regarded as a family allowance within the meaning of Regulation No 1408/71, since such a classification is, in the very words of Article 1(u)(ii) of that regulation, reserved to benefits granted exclusively by reference to the number and, where appropriate, the age of members of the family.
36 The answer to Question 1(a) must therefore be that a person entitled to a pension payable under the legislation of a single Member State and residing on the territory of another Member State cannot rely on either Article 3(1) of Regulation No 1408/71 or any other provision of that regulation in order to obtain from the Member State under whose legislation he receives his pension study finance such as that introduced by the WSF. Question 1(b) and Question 2
37 By Question 1(b) and Question 2, which must be examined together, the national court is asking in substance whether Article 7(1) of Regulation No 1612/68 and Articles 48 and 52 of the Treaty must be interpreted as meaning that they preclude the application of national legislation which limits the grant of study finance solely to national students or to those treated as such by virtue of their residence on the territory of the Member State which has introduced such finance, both categories of students, moreover, being required in principle to be studying in an institution on that territory, where it follows from those conditions that the children of a person in a situation such as the plaintiff's are not eligible for that finance.
38 In order to answer the questions as thus reformulated, it is necessary, first, to observe that Article 52 of the Treaty cannot apply to a dispute such as that before the national court, since Mrs Esmoris Cerdeiro-Pinedo Amado has not exercised the right of free establishment guaranteed by that provision. Since that part of the question clearly has no bearing on the subject-matter of the proceedings before the national court and has no relevance to their outcome, there is no need to answer it.
39 As regards, second, Article 48 of the Treaty and Regulation No 1612/68, it is first of all necessary to ascertain whether the dispute before the national court falls within the scope of those provisions and, in particular, whether Mrs Esmoris Cerdeiro-Pinedo Amado has the status of migrant worker for the purpose of those provisions.
40 The plaintiff did indeed exercise the right to freedom of movement laid down in Article 48 of the Treaty and, on that basis, she did fall within the scope of that provision, and also within that of Regulation No 1612/68, during the period when she was employed in the Netherlands.
41 In the present case, however, the question is whether such provisions may be interpreted as meaning that they may be relied upon in order to defeat national legislation such as the WSF by a worker who has ceased to exercise her occupational activity in the host Member State and returned to her Member State of origin.
42 In that regard, the Court has held that, once the employment relationship has ended, the person concerned as a rule loses his status of worker within the meaning of Article 48 of the Treaty, although that status may produce certain effects after the relationship has ended (see Case C-85/96 Martínez Sala [1998] ECR I-2691, paragraph 32).
43 In the present case, it cannot be claimed that, in the case of a migrant worker who, like the plaintiff, has ceased work and returned to her Member State of origin, where her children also live, the conditions to which the WSF subjects the grant of study finance, set out in paragraph 37 above, are capable of impeding the right to freedom of movement which that worker enjoys under Article 48 of the Treaty.
44 As regards Regulation No 1612/68, it should first of all be observed that Article 7(1) relates to the conditions of employment and work, in particular as regards remuneration, dismissal and reinstatement or re-employment, so that it cannot as such apply in the context of the main proceedings.
45 On the other hand, it is common ground that Article 7(2) of Regulation No 1612/68, which prohibits any discrimination between national workers and migrant workers in the granting of social advantages, is prima facie applicable since the study finance introduced by the WSF does indeed constitute such a social advantage (see Case C-3/90 Bernini [1992] ECR I-1071, paragraph 23, and Case C-337/97 Meeusen [1999] ECR I-3289). To that extent, the question must be taken to refer to Article 7(2) and not to Article 7(1) of Regulation No 1612/68.
46 However, it must be noted that such a provision cannot be interpreted as being of such a kind as to guarantee the maintenance of a social advantage such as the finance introduced by the WSF for migrant workers who have ceased to exercise an activity in the host Member State and returned to their Member State of origin.
47 It should be remembered that it follows, in particular from the context to which that provision belongs and also its aims, that in so far as it guarantees access without discrimination to the social benefits granted by the host Member State, it cannot, as a general rule and except in special circumstances (see inter alia Case C-57/96 Meints [1997] ECR I-6689, concerning compensation the grant of which depended on an employment relationship which has recently come to an end and which was intrinsically linked with the recipients' objective status as workers), be extended to workers who, after ceasing to exercise their occupational activity in the host Member State, have decided to return to their Member State of origin.
48 Article 7(2) of Regulation No 1612/68 comes under Title II, on Employment and equality of treatment.
49 Furthermore, it must be remembered that Regulation (EEC) No 1251/70 of the Commission of 29 June 1970 on the right of workers to remain in the territory of a Member State after having been employed in that State (OJ, English Special Edition 1971(II), p. 402) expressly provides in Article 7 that the right to equality of treatment established by Regulation No 1612/68 is to apply also to migrant workers who have ceased to exercise their occupational activity where they have decided to remain in the host Member State.
50 As regards the purpose of the provision in question, the fifth recital of the preamble to Regulation No 1612/68 states that the right of freedom of movement, in order that it may be exercised, by objective standards, in freedom and dignity, requires ... that obstacles to the mobility of workers shall be eliminated, in particular as regards the worker's right to be joined by his family and the conditions for the integration of that family into the host country.
51 In the light of the foregoing considerations, and in the absence of special circumstances justifying a departure from the fundamental principle set out above, the answer to the court making the reference must be that a national of a Member State who has exercised the right to freedom of movement guaranteed by Article 48 of the Treaty and has ceased to exercise his occupational activity in the host Member State and returned to his Member State of origin, in which his children also reside, cannot rely on Article 48 or on Article 7(2) of Regulation No 1612/68 in order to obtain from the Member State in which he was employed a right to have his children's studies financed in the same conditions as those applied by that State to its own nationals. The questions in Mr Fahmi's case Question 1
52 By Question 1, the national court is asking essentially whether Article 41 of the Cooperation Agreement is to be interpreted as meaning that a Moroccan worker who has ceased to exercise his occupational activity in the host Member State and has returned to his country of origin, or his dependent children who themselves live outside the Community, may rely, in regard to study finance such as that introduced by the WSF, on the principle laid down in that provision that any discrimination based on nationality in the field of social security is prohibited.
53 The Commission and the Netherlands, Austrian and United Kingdom Governments consider, unlike Mr Fahmi, that a Moroccan worker who has ceased to exercise his occupation in a Member State and returned to his country of origin, where he lives, is no longer entitled to rely on Article 41(1) of the Cooperation Agreement, which prohibits any discrimination based on nationality between Moroccan workers and nationals of the Member State concerned in the field of social security.
54 The Commission and the United Kingdom Government further consider that the study finance introduced by the WSF does not come within the field of social security, so that Article 41 of the Cooperation Agreement does not apply to the main proceedings.
55 The Netherlands, Austrian, French and United Kingdom Governments and the Commission also assert that it follows from both Article 41(3) of the Cooperation Agreement, inasmuch as it limits the right to family allowances in the case of Moroccan workers to their children who are resident in the Community, and from Article 41(4), which provides that certain allowances are available outside the Community only in the case of the pensions and annuities listed therein, that the Agreement does not entitle Moroccan nationals resident outside the Community to obtain family allowances for members of their families who are themselves resident outside the Community.
56 It should be noted, first of all, that it is clear from the case-law of the Court that the purpose of the Cooperation Agreement is to consolidate the position of Moroccan workers and members of their families living with them in the host Member State as regards social security (Case C-179/98 Mesbah [1999] ECR I-7955, paragraph 36) and that, with specific regard to family allowances, the prohibition of discrimination laid down in Article 41(1) of the Agreement is guaranteed only within the limits of the conditions laid down in Article 41(3) (Case C-18/90 Kziber [1991] ECR I-199, paragraph 18).
57 Without its being necessary to adjudicate on the precise legal classification, from the standpoint of the Cooperation Agreement, of benefits such as those paid under the WSF, it is sufficient in the present case to state that it follows both from the wording of Article 41(1) and (3) of the Agreement and also from the spirit of that provision that, unless the children of a Moroccan worker reside in the Community, neither that worker nor his children can rely, in regard to benefits of the kind at issue in the main proceedings, on the principle of the prohibition of discrimination laid down in that provision.
58 The answer to Question 1 must therefore be that Article 41 of the Cooperation Agreement must be interpreted as meaning that where the dependent children of a Moroccan worker do not reside in the Community, neither the Moroccan worker concerned nor his children can rely, in regard to study finance such as that introduced by the WSF, on the principle of the prohibition of discrimination on the basis of nationality laid down in that provision in relation to social security. Question 2
59 In the light of the answer to Question 1, there is no need to answer Question 2.