Summary
Parties
Grounds
Decision on costs
Operative part
Keywords
1 Preliminary rulings - Admissibility of references - Need to provide the Court with sufficient details of the factual and legal context
(EC Treaty, Art. 177 (now Art. 234 EC))
2 Competition - Community rules - Scope ratione materiae - Collective agreements in pursuit of social policy objectives - Collective agreement setting up a sectoral pension fund - Decision by the public authorities making membership compulsory - Not covered
(EC Treaty, Art. 3(g) and (i) (now, after amendment, Art. 3(1)(g) and (j) EC), Arts 5 and 85(1) (now Arts 10 EC and 81(1) EC) and Arts 118 and 118b (Arts 117 to 120 of the EC Treaty have been replaced by Arts 136 EC to 143 EC))
3 Competition - Community rules - Undertaking - Concept - Pension fund entrusted with the management of a supplementary pension scheme - Scheme operated in accordance with the principle of capitalisation - Covered
(EC Treaty, Art. 85 et seq. (now Art. 81 EC et seq.))
4 Competition - Public undertakings and undertakings to which Member States grant special or exclusive rights - Undertakings entrusted with the management of services of general economic interest - Pension fund entrusted with the management of a supplementary pension scheme
(EC Treaty, Arts 86 and 90 (now Arts 82 EC and 86 EC))
Summary
1 The need to provide an interpretation of Community law which will be of use to the national court makes it necessary that the national court define the factual and legal context of the questions it is asking or, at the very least, explain the factual circumstances on which those questions are based. Those requirements are of particular importance in certain areas, such as that of competition, where the factual and legal situations are often complex.
The information provided in orders for reference must not only be such as to enable the Court to reply usefully but must also give the governments of the Member States and other interested parties the opportunity to submit observations pursuant to Article 20 of the Statute of the Court of Justice. It is the Court's duty to ensure that the opportunity to submit observations is safeguarded, bearing in mind that, by virtue of the abovementioned provision, only the orders for reference are notified to the interested parties.
2 If Article 3(g) and (i) of the Treaty (now, after amendment, Article 3(1)(g) and (j) EC), Article 85(1) thereof (now Article 81(1) EC), Articles 118 and 118b thereof (Articles 117 to 120 of the Treaty have been replaced by Articles 136 EC to 143 EC) are construed as an effective and consistent body of provisions, it follows that agreements concluded in the context of collective negotiations between management and labour, in pursuit of social policy objectives such as the improvement of conditions of work and employment, must, by virtue of their nature and purpose, be regarded as falling outside the scope of Article 85(1) of the Treaty.
An understanding in the form of a collective agreement which sets up in a particular sector a supplementary pension scheme to be managed by a pension fund to which affiliation may be made compulsory by the public authorities does not, by virtue of its nature and purpose, fall within the scope of Article 85(1) of the Treaty. Such a scheme seeks generally to guarantee a certain level of pension for all workers in that sector and therefore contributes directly to improving one of their working conditions, namely their remuneration.
A decision by the public authorities, at the request of the parties to the agreement, to make affiliation to such a fund compulsory cannot therefore be regarded as requiring or favouring the adoption of agreements, decisions or concerted practices contrary to Article 85 of the Treaty or as reinforcing their effects. Accordingly, it does not fall within the categories of legislative measures which undermine the effectiveness of Articles 3(g) of the Treaty, Article 5 thereof (now Article 10 EC) or Article 85 thereof.
It follows that Articles 3(g), 5 and 85 of the Treaty do not preclude a decision by the public authorities to make affiliation to a sectoral pension fund compulsory at the request of organisations representing employers and workers in a given sector.
3 The concept of an undertaking for the purposes of Article 85 et seq. of the Treaty (now Article 81 et seq. EC) encompasses every entity engaged in an economic activity, regardless of the legal status of the entity and the way in which it is financed.
It therefore embraces a pension fund which has been entrusted with the management of a supplementary pension scheme, which has been set up by a collective agreement between organisations representing management and labour in a particular sector, membership of which has been made compulsory for all workers in that sector by the public authorities, which operates in accordance with the principle of capitalisation and which engages in an economic activity in competition with insurance companies. Neither the fact that the fund is non-profit-making nor the fact that it pursues a social objective is sufficient to deprive it of its status as an undertaking within the meaning of the competition rules of the Treaty.
4 Articles 86 and 90 of the Treaty (now Articles 82 EC and 86 EC) do not preclude the public authorities from conferring on a pension fund the exclusive right to manage a supplementary pension scheme in a given sector.
The exclusive right of a sectoral pension fund to manage supplementary pensions in a given sector and the resultant restriction of competition may be justified under Article 90(2) of the Treaty as a measure necessary for the performance of a particular social task of general interest with which that fund has been entrusted.
Parties
In Case C-67/96,
REFERENCE to the Court under Article 177 of the EC Treaty (now Article 234 EC) by the Kantongerecht, Arnhem, Netherlands, for a preliminary ruling in the proceedings pending before that court between
Albany International BV
and
Stichting Bedrijfspensioenfonds Textielindustrie
on the interpretation of Articles 85, 86 and 90 of the EC Treaty (now Articles 81 EC, 82 EC and 86 EC),
THE COURT,
composed of: G.C. Rodríguez Iglesias, President, J.-P. Puissochet, G. Hirsch and P. Jann (Presidents of Chambers), J.C. Moitinho de Almeida (Rapporteur), C. Gulmann, J.L. Murray, D.A.O. Edward, H. Ragnemalm, L. Sevón and M. Wathelet, Judges,
Advocate General: F.G. Jacobs,
Registrar: D. Louterman-Hubeau, Principal Administrator,
after considering the written observations submitted on behalf of:
- Albany International BV, by T.R. Ottervanger, of the Rotterdam Bar, and H. van Coeverden, of the Hague Bar,
- Stichting Bedrijfspensioenfonds Textielindustrie, by E. Lutjens, of the Amsterdam Bar, and O. Meulenbelt, of the Utrecht Bar,
- the Netherlands Government, by A. Bos, Legal Adviser in the Ministry of Foreign Affairs, acting as Agent,
- the German Government, by E. Röder, Ministerialrat at the Federal Ministry of the Economy, and C.-D. Quassowski, Regierungsdirektor at the same Ministry, acting as Agents,
- the French Government, by K. Rispal-Bellanger, Head of the Subdirectorate for International Economic Law and Community Law in the Legal Affairs Directorate of the Ministry of Foreign Affairs, and C. Chavance, Foreign Affairs Secretary in that Directorate, acting as Agents,
- the Commission of the European Communities, by W. Wils, of its Legal Service, acting as Agent,
having regard to the Report for the Hearing,
after hearing the oral observations of Albany International BV, represented by T.R. Ottervanger; Stichting Bedrijfspensioenfonds Textielindustrie, represented by E. Lutjens and O. Meulenbelt; the Netherlands Government, represented by M. A. Fierstra, Head of the European Law Department in the Ministry of Foreign Affairs, acting as Agent; the French Government, represented by C. Chavance; the Swedish Government, represented by A. Kruse, Departementsråd in the Legal Secretariat (EU) of the Ministry of Foreign Affairs, acting as Agent, and the Commission, represented by W. Wils, at the hearing on 17 November 1998,
after hearing the Opinion of the Advocate General at the sitting on 28 January 1999,
gives the following
Judgment
Grounds
1 By judgment of 4 March 1996, received at the Court on 11 March 1996, the Kantongerecht (Cantonal Court), Arnhem, referred to the Court of Justice for a preliminary ruling under Article 177 of the EC Treaty (now Article 234 EC) three questions on the interpretation of Articles 85, 86 and 90 of the EC Treaty (now Articles 81 EC, 82 EC and 86 EC).
2 Those questions were raised in an action brought by Albany International BV (hereinafter `Albany') against Stichting Bedrijfspensioenfonds Textielindustrie (the Textile Industry Trade Fund, hereinafter `the Fund') concerning Albany's refusal to pay to the Fund contributions for 1989 on the ground that compulsory affiliation to the Fund by virtue of which such contributions are claimed from it is contrary to Article 3(g) of the EC Treaty (now, after amendment, Article 3(1)(g) EC) and Articles 85, 86 and 90 of the Treaty.
The national legislation
3 The pension system in the Netherlands is based on three pillars.
4 The first is a statutory basic pension, granted by the State under the Algemene Ouderdomswet (General law on old-age pensions, `the AOW') and the Algemene Nabestaandenwet (General law on survivors' benefits). That compulsory statutory scheme entitles the whole population to receive a pension of a limited amount, regardless of the wage which they actually received previously, calculated by reference to the statutory minimum wage.
5 The second pillar comprises supplementary pensions provided in the context of employment or self-employed activity, which serve in most cases to top up the basic pension. Such supplementary pensions are normally managed by collective schemes covering a sector of the economy, a profession or the employees of an undertaking by funds affiliation to which has been made compulsory, as in the case in the main proceedings, by the Wet van 17 maart 1949 houdende vaststelling van en regeling betreffende verplichte deelneming in een bedrijfspensioenfonds (Law of 17 March 1949 on compulsory affiliation to a sectoral pension fund, hereinafter the `BPW').
6 The third pillar comprises individual pension or life assurance policies which may be concluded on a voluntary basis.
7 The Wet op de Loonbelasting (Wages Tax Law) provides that pension contributions are deductible only if the pension does not exceed a `reasonable' level. They are not deductible in the case of a pension exceeding that level, which is set at 70% of the final salary after a 40-year career. The effect of this tax regime is that the current standard in the Netherlands for establishing a pension, including the State pension under the AOW, is a pension corresponding to 70% of the final salary.
8 Article 1(1) of the BPW, as amended by the Law of 11 February 1988, provides:
`The following terms shall, for the purposes of this Law and of provisions based on it, have the following meanings:
...
(b) sectoral pension fund: a fund operating in a sector of activity for the purposes of which funds are collected either solely for the benefit of employees in the sector concerned or also for the benefit of persons engaged in an activity in another capacity in the said sector.
...
(f) our Minister: the Minister for Social Affairs and Employment.'
9 Article 3 of the BPW, as amended, provides:
`1. Our Minister may, at the request of a sectoral trade organisation which he regards as sufficiently representative of the business structure of a sector of activity, after consulting the head of the appropriate general administrative department whose area of responsibility includes the activities of the sector concerned, the Sociaal-Economische Raad (Social and Economic Council) and the Verzekeringskamer (Insurance Board), make affiliation to the sectoral pension fund compulsory for all workers or for certain categories of worker in the sector of activity concerned.
2. In the circumstances mentioned in the foregoing paragraph, all persons within the categories concerned by virtue of the provisions of that paragraph, and also, in the case of employees, their employers, shall be required to comply with the statutes and regulations of the sectoral pension fund and any provisions applicable to them by virtue thereof. Compliance therewith may be enforced by legal proceedings, in particular with regard to the payment of contributions.'
10 Article 5(2) of the BPW, as amended, lays down certain conditions to be fulfilled before the Minister for Social Affairs and Employment can approve a request for compulsory affiliation as provided for in Article 3(1). Thus, under Article 5(2)(III) and (IV) of the BPW, as amended, the statutes and regulations of the sectoral pension fund must adequately safeguard the interests of the members, and the representatives of the associations of employers and workers in the sector concerned must sit in equal numbers on the management board of the fund.
11 Article 5(2)(II)(1) of the BPW, as amended, also provides that the statutes and regulations of the sectoral pension fund must provide for cases in which, and the conditions under which, workers in the sector concerned are not required to be affiliated to the fund or may be exempted from certain obligations relating to the fund.
12 Article 5(3) of the BPW, as amended, states:
`Our Minister for Social Affairs and Employment, after hearing the views of the Insurance Board and the Social and Economic Council, shall adopt guidelines concerning the matters referred to in Article 5(2)(II)(1). Those guidelines should observe the principle that workers who were already affiliated to a pension fund of an undertaking or were insured with a life assurance company six months before the request referred to in Article 3(1) was lodged, shall not be required to be affiliated to that sectoral pension fund or shall be exempted, entirely or to a reasonable extent, from the obligation to contribute to it, provided that they can demonstrate that, in the course of the period for which they are under no obligation to be affiliated or are exempted from the obligation to pay contributions, in their entirety or as regards a reasonable proportion thereof, they will acquire pension rights which are at least equivalent to those which they would acquire if affiliated to the sectoral pension fund and for so long as they can so demonstrate. Our Minister may also adopt guidelines relating to other parts of paragraph 2.'
13 By the Beschikking van 29 december 1952 betreffende de vaststelling van de richtlijnen voor de vrijstelling van deelneming in een bedrijfspensioenfonds wegens een bijzondere pensioenvoorziening (Order of 29 December 1952 relating to the adoption of guidelines for the exemption from participation in a sectoral pension fund in case of special pension arrangements, as amended by the decision of 15 August 1988, hereinafter `the Guidelines for exemption from affiliation') the Minister for Social Affairs and Employment adopted the guidelines referred to in Article 5(3) of the BPW, as amended.
14 Article 1 of the Guidelines for exemption from affiliation, as amended, provides:
`An exemption from the obligation to be affiliated to a sectoral pension fund or from the obligation to pay contributions thereto may be granted by that fund at the request of any interested party, provided that the worker in the sector concerned is covered by special pension arrangements meeting the following conditions:
(a) the arrangements must be applied under the auspices of a company pension fund, another sectoral fund or an insurer holding a certificate of the kind provided for by Article 10 of the Wet toezicht verzekeringsbedrijf (Law on supervision of the insurance industry, Staatsblad 1986, p. 638) or be based on the Algemene burgerlijke pensioenwet (General law on civil service pensions, Staatsblad 1986, p. 540), the Spoorwegenpensioenwet (Law on pensions for employees of the Netherlands Railways and their relatives, Staatsblad 1986, p. 541) or the Algemene militaire pensioenwet (General law on military pensions, Staatsblad 1979, p. 305);
(b) such rights as may arise under those arrangements must, in the aggregate, be at least equivalent to those accruing under the sectoral pension fund;
(c) the rights of the worker concerned and compliance with his obligations must be adequately safeguarded;
(d) if the exemption entails withdrawal from the fund, compensation considered reasonable by the Insurance Board must be offered for any loss suffered by the fund, from the actuarial point of view, as a result of the withdrawal.'
15 Article 5 of the Guidelines, as amended, provides:
`1. The exemption must be granted where the conditions mentioned in Article 1(a), (b) and (c) are fulfilled, the special pension arrangements applied six months before submission of the request on the basis of which affiliation to the sectoral pension fund was made compulsory and it has been shown that, in the course of the period for which the worker concerned is under no obligation to be affiliated or is exempted from the obligation to pay contributions in their entirety or as regards a reasonable proportion thereof, he will acquire pension rights which are at least equivalent to those which he would acquire if affiliated to the sectoral pension fund.
2. If, at the time referred to in paragraph 1, the special pension arrangements did not meet the condition laid down in Article 1(b), a sufficient period must be allowed to elapse to enable that condition to be met before any decision is taken on the request.
3. An exemption under this article shall enter into force when affiliation to the sectoral pension fund is made compulsory.'
16 Article 9 of the Guidelines, as amended, states:
`1. The decisions referred to in Article 8 may be the subject of complaints to the Insurance Board lodged within 30 days of receipt of the decision by the person concerned. The sectoral pension fund must, in writing, bring the foregoing sentence to the notice of the person concerned at the same time as the decision.
2. The Insurance Board shall notify its decision on the complaints to the sectoral pension fund and to the persons who lodged them.'
17 The appraisal made by the Insurance Board constitutes a proposal for conciliation. It is not a decision with binding force in the context of a dispute. The appraisal by the Insurance Board cannot be the subject of any complaint or appeal.
18 Sectoral pension funds to which affiliation has been made compulsory are subject not only to the BPW but also to the Wet van 15 mei 1962 houdende regelen betreffende pensioen- en spaarvoorzieningen (Law of 15 May 1962 on pension and savings funds, amended subsequently a number of times - hereinafter `the PSW').
19 The PSW is intended to ensure as far as possible that pension commitments given to workers are actually fulfilled.
20 To that end, Article 2(1) of the PSW obliges employers to choose one of three sets of arrangements aimed at separating the funds collected for pension purposes from the remainder of the company's assets. The employer may either join a sectoral pension fund, set up a company pension fund, or arrange group or individual life assurance policies with an insurance company.
21 Article 1(6) of the PSW makes clear that it also applies to sectoral pension funds to which affiliation has been made compulsory under the BPW.
22 The PSW also lays down a number of conditions which must be met by the statutes and regulations of a sectoral pension fund. Thus, Article 4 of the PSW provides that the setting up of any such fund must be notified to the Minister for Social Affairs and Employment and to the Insurance Board. Article 6(1) of the PSW confirms that representatives of the employers' organisations and representatives of the workers' organisations of the sector concerned are to sit in equal numbers on the management board of a sectoral pension fund.
23 In addition, Articles 9 and 10 of the PSW lay down detailed arrangements for management of the funds collected. The general rule is set out in Article 9 which obliges pension funds to transfer the risk linked to their pension commitments or to reinsure it. By way of exception to that rule Article 10 allows pension funds to administer and invest the capital collected themselves at their own risk. Before it can be authorised to do so, a pension fund must submit to the competent authorities a management plan explaining in detail the way it proposes to handle the actuarial and financial risks. The plan must be approved by the Insurance Board. Furthermore the pension fund is subject to continuous supervision. The scheme's actuarial profit and loss accounts must be submitted regularly to the Insurance Board for approval.
24 Finally, Articles 13 to 16 of the PSW lay down rules for investment of the sums collected. By virtue of Article 13, the assets of the scheme together with expected income must be sufficient to cover pension liabilities. Under Article 14 investments must be made prudentially.
The main proceedings
25 The Fund was established under the BPW. Affiliation to the Fund was made compulsory by an order of the Minister for Social Affairs and Employment of 4 December 1975 (hereinafter `the order making affiliation compulsory').
26 Albany operates a textile business which has been affiliated to the Fund since 1975.
27 Until 1989 the Fund's pension scheme paid a flat-rate benefit. The pension awarded to workers was not proportional to their wage but was a fixed amount for each worker. Albany decided that the scheme was insufficiently generous and in 1981 concluded arrangements with an insurance company for a supplementary pension for its workers so that the total pension to which they would be entitled after 40 years' employment amounts to 70% of their last salary.
28 With effect from 1 January 1989 the Fund changed its pension scheme. Since then its scheme awards workers an amount which likewise represents 70% of their final salary.
29 Following the change to the Fund's pension scheme, Albany asked on 22 July 1989 to be exempted from affiliation. Its request was rejected by the Fund on 28 December 1990. The Fund took the view that under the Guidelines for exemption from affiliation such exemption could only be granted when the conditions laid down in the Guidelines were satisfied and where the special provisions concerning pensions had already been in force for six months before lodgment of the request by both sides of the industry in response to which the sectoral pension fund had been declared compulsory.
30 Albany lodged an objection to the Fund's decision with the Insurance Board. By decision of 18 March 1992, the Board found that, even if the Fund was not required in the circumstances to grant the exemption, it should be asked to exercise its power to do so or, at the very least, grant a period of notice, since Albany had concluded arrangements for a supplementary pension scheme for its staff several years earlier and the latter arrangements had, since 1 January 1989, been similar to those introduced by the Fund.
31 The Fund did not follow the advice of the Insurance Board and on 11 November 1992 served Albany with a demand for payment of the sum of NLG 36 700.29, representing all statutory contributions payable since 1989 together with interest, collection charges, non-judicial expenses and legal aid costs.
32 Albany challenged that demand before the Kantongerecht, Arnhem. It contended in particular that the system of compulsory affiliation to the Fund was contrary to Article 3(g) of the Treaty, Articles 52 and 59 of the EC Treaty (now, after amendment, Articles 43 EC and 49 EC), and Articles 85, 86 and 90 of the Treaty.
33 According to Albany, the Fund's refusal to grant it an exemption is detrimental to it. Its insurance company would grant it less favourable conditions if it had to join the supplementary pension scheme set up by the Fund. Moreover, contrary to the Fund's contention, other sectoral pension funds, such as the Bedrijfspensioenfonds voor de Bouwnijverheid and the Bedrijfspensioenfonds voor de Schildersbedrijf, had granted an exemption to undertakings which had at an earlier stage concluded supplementary pension arrangements.
34 The Fund maintained that in this case there was no legal obligation to grant an exemption. Accordingly, the court could only exercise limited review in that respect. Under Article 5(3) of the BPW, an exemption had to be granted only where an undertaking had established an equivalent pension scheme at least six months before affiliation was made compulsory. The obligation to grant such an exemption arises only upon initial affiliation to the Fund and does not arise in the event of a change to the pension arrangements. The Fund also emphasised that it was important to maintain a proper pension scheme based on the principle of solidarity for all workers and undertakings in the textile industry and stressed in that connection that the grant of an exemption to Albany would entail the departure of 110 people from its membership of about 8 800.
35 The Kantongerecht accepted the Insurance Board's argument that since 1 January 1989 Albany's supplementary scheme had been similar to the pension scheme introduced by the Fund. It emphasised that relations between a sectoral pension fund and its members are governed by requirements of reasonableness and equity as well as by the general principles of sound administration. Accordingly, a sectoral pension fund should give considerable weight to the opinion of a statutorily appointed independent expert authority such as the Insurance Board when asked to grant an exemption.
36 The Kantongerecht observed that in its judgment in Joined Cases C-430/93 and C-431/93 Van Schijndel and Van Veen [1995] ECR I-4705 the Court had not examined the last three questions concerning the compatibility with the Community competition rules of the Netherlands system of compulsory affiliation to an occupational pension scheme.
37 In those circumstances the Kantongerecht, Arnhem, referring to its interlocutory judgments of 19 April 1993, 17 January 1994 and 9 January 1995, stayed proceedings pending a preliminary ruling from the Court of Justice on the following questions:
`1. Is a sectoral pension fund within the meaning of Article 1(1)(b) of the [BPW] an undertaking within the meaning of Articles 85, 86, or 90 of the EC Treaty?
2. If so, is the fact of making membership of the sectoral pension fund for industrial undertakings compulsory a measure adopted by a Member State which nullifies the effectiveness of the competition rules applicable to undertakings?
3. If Question 2 must be answered in the negative, can other circumstances render compulsory membership incompatible with Article 90 of the Treaty, and if so, which?'
Admissibility
38 The Netherlands and French Governments and the Commission query the admissibility of the questions submitted, taking the view that the national court has not, in its order for reference, sufficiently explained the factual and legal context of the main proceedings. In the absence of a detailed account from the national court of the legal provisions applicable to the main proceedings, the circumstances in which the Fund was set up and the ma
