Opinion of the Advocate-General
++++
Mr President,
Members of the Court,
1 . The Arbeidsrechtbank, Antwerp, seeks a ruling from this Court on the interpretation of certain provisions of Council Regulation ( EEC ) No 1408/71 on the application of social security schemes to employed persons and their families moving within the Community ( 1 ) ( hereinafter referred to as "Regulation No 1408/71 ") in connection with a problem concerning the overlapping of family benefits claimed, in respect of a child residing with its parents in the Netherlands, by the father under the legislation of the Kingdom of Belgium, where he is employed, and by the mother under the legislation of the Federal Republic of Germany, where she is employed .
2 . Article 13(2)(a ) of Regulation No 1408/71 provides that "a person employed in the territory of one Member State shall be subject to the legislation of that State even if he resides in the territory of another Member State ". Article 73(1 ) of that regulation provides that : "An employed person subject to the legislation of a Member State ... shall be entitled to the family benefits provided for by the legislation of the first Member State for members of his family residing in the territory of another Member State, as though they were residing in the territory of the first State ". On the strength of those provisions, Mr and Mrs Dammer, who are both Netherlands nationals, consider themselves each entitled to the family benefits for their child provided for by the legislation of their respective States of employment, and therefore claim that they should receive those benefits .
3 . It appears at first sight that the provisions of Regulation No 1408/71 and of its implementing regulation, Council Regulation No 574/72 of 21 March 1972 ( 2 ) ( hereinafter referred to as "Regulation No 574/72 "), have not provided explicitly for cases of overlapping such as the one described above . As far as the provisions relating specifically to family benefits are concerned, it may be observed that Article 76 of Regulation No 1408/71 provides : "Entitlement to family benefits or family allowances under the provisions of Articles 73 and 74 shall be suspended if, by reason of the pursuit of a professional or trade activity, family benefits or family allowances are also payable under the legislation of the Member State in whose territory the members of the family are residing ". The case referred to there is, in fact, that in which one of the parents works in the Member State in which the child actually resides - as may be seen, moreover, from the implementing provision contained in Article 10(1)(b)(i ) of Regulation No 574/72, which provides that in cases where there is overlapping of the entitlement of one parent who works in one Member State and that of the other parent who is employed in the Member State in whose territory the child resides, only the family benefits or allowances of the latter State are to be paid . It is thus clear that the situation in which there is overlapping of the benefits to which a father and a mother, each working in a different Member State other than that in which the child resides, are entitled has not been taken into account in those provisions .
4 . Since it is not possible to refer to the rules of priority contained in Article 76 of Regulation No 1408/71 and Article 10(1)(b)(i ) of Regulation No 574/72, the Arbeidsrechtbank asks whether Article 73(1 ) of Regulation No 1408/71 may be interpreted as meaning that it is possible for parents in the position of Mr and Mrs Dammer to choose the Member State in which the child is to be deemed to reside, and thus the legislation under which the family benefits are to be calculated and paid . In practice, as the national court explicitly points out in its first question, that solution would mean allowing such parents to choose the Member State whose legislation provided the highest benefit .
5 . The provision in question cannot, in my view, be interpreted in that manner . Although, when read in conjunction with Article 12(1 ) of Regulation No 1408/71, it prevents the overlapping of benefits for parents in the position of Mr and Mrs Dammer, it does not, I think, set up a rule of priority at the parents' discretion, whereby they have a free choice . In the following observations I should like to begin by expanding on that point of view .
6 . First of all, it would appear to be out of the question for Article 73(1 ) of Regulation No 1408/71 to be used to justify a case of overlapping benefits . It is true that the provision establishes one fiction, inasmuch as it provides that a child is to be considered as if he resided in one Member State where he does not in fact reside, but where one of his parents works . It therefore gives rise to two fictions when the two parents work in different Member States, neither of which is the State of residence . But it must also be borne in mind that the first sentence of Article 12(1 ) of Regulation No 1408/71 provides : "This regulation can neither confer nor maintain the right to several benefits of the same kind for one and the same period of compulsory insurance ". So Article 73(1 ) of that regulation cannot be interpreted as conferring a right to receive, for the same child and in respect of the same period, both of the overlapping family allowances provided for under the legislation of the two Member States in which the two parents are respectively employed, while residing with the child in a third Member State .
7 . Let me say here and now that the Commission' s view that Article 12 of Regulation No 1408/71 covers the overlapping of benefits for the same recipient and does not apply to cases such as that of Mr and Mrs Dammer, where each parent is claiming family benefits, does not appear very convincing to me . Article 12(1 ) precludes any "right to several benefits of the same kind for one and the same period of compulsory insurance ". A case in which each of the two parents claims family benefits for the same child in respect of the same period is not, in my view, clearly excluded from the scope of the provision by that wording . I do not think that the Court' s judgment of 20 April 1988 in Bakker, ( 3 ) to which the Commission refers, is inconsistent with that interpretation . Paragraphs 11 and 12 of that judgment clearly show that it was Article 12(2 ) of Regulation No 1408/71 which was interpreted as concerning only cases where the same person was in receipt of more than one benefit . I would also add that the interpretation of that provision which the Court adopted - and which I myself suggested in my Opinion - with regard to cases where retirement or survivors' pensions were paid to two different recipients, does not, in my view, prejudge that to be adopted with regard to cases where each parent qualifies for family benefits for the same child in respect of the same periods . I am not certain that it would be consistent with the general objectives of Regulation No 1408/71, and thus with those of the Treaty, to adhere strictly to the view that there must be a single entitled person . I shall return to this point but, as I have said, we are concerned for the moment with Article 12(1 ) of that regulation .
8 . Furthermore, it appears of interest to note that certain provisions of Regulation No 574/72, which are explicitly stated therein to implement Article 12 of Regulation No 1408/71, undeniably relate to situations where overlapping benefits are paid to different recipients . The aim of Article 10(1)(b)(i ) of Regulation No 574/72, which forms part of a subdivision of that regulation entitled "Implementation of Article 12 of the Regulation", is to lay down rules of priority applicable in the case of overlapping rights to family benefits derived by one parent under the legislation of the Member State in which he or she works and by the other parent under that of the Member State in which he or she resides with the child or children . If the implementation of Article 12 of Regulation No 1408/71, as envisaged by a provision of Regulation No 574/72, concerns cases in which family benefits overlap because each of the parents of a single child is entitled to benefits, does that not suggest that Article 12 can be interpreted as concerning certain cases in which the benefits to which two recipients are entitled overlap? I think it does . Since one of the provisions of Regulation No 574/72 itself shows that Article 12 may be applied, in the field of family benefits, to specified cases where such benefits concern each of a child' s two parents, for the same period, I do not believe that the "single recipient" requirement can be enough to justify the non-application of that article in other cases where family benefits concern each of a child' s two parents for the same period .
9 . I therefore consider that a case such as that of Mr and Mrs Dammer is covered by Article 12(1 ) of Regulation No 1408/71 and that Article 73(1 ) of that regulation may be interpreted, when read in conjunction with Article 12(1 ), as precluding the overlapping of family benefits for the same child and in respect of the same periods, provided under the legislation of each of the two Member States in which the parents work but do not reside .
10 . However, although Article 73(1 ), read in conjunction with Article 12(1 ), prohibits overlapping in cases such as that of Mr and Mrs Dammer, it still does not contain any rule to determine the manner in which the parents concerned are actually to be paid the family benefits . That is because Article 12(1 ) lays down a general Community rule against overlapping and it is for the implementing provisions to specify the manner in which, in the various possible situations, benefits are actually to be paid . With regard to family benefits, Article 10(1)(b)(i ) of Regulation No 574/72 lays down rules of priority as between benefits provided under the legislation of several Member States . For instance, where, pursuant to Article 73(1 ) of Regulation No 1408/71, one parent can claim the family benefits provided under the legislation of the Member State in which he or she works and, at the same time, the other parent pursues a professional or trade activity in the Member State of residence, where the child lives, and can claim family benefits there, only the latter benefits will be paid and the right to the former is suspended . But no "rule of priority" has been laid down, in either Regulation No 1408/71 or 574/72, for cases where two parents claim family benefits in their respective Member States of employment, but reside with the child in a third Member State .
11 . In my view, that lacuna in the Community rules could not be filled by interpreting them as meaning that the parents can choose the legislation under which they are actually to receive the benefits . There is nothing in the Community legislation on social security which begins to suggest a basis for such an interpretation, which would consistently make the relevant institutions of the Member State whose legislation provided the highest benefits responsible for the actual payment of benefits . Such "reverse social welfare dumping" seems to me, moreover, to be entirely foreign to the objectives of the Treaty and of the regulations adopted to implement it . I accordingly consider that the national court' s first question should be answered in the negative .
12 . I do not think, however, that the Court, having once dismissed an interpretation giving the parents "freedom of choice" as to the legislation under which the benefits are actually to be paid, can then find that there is no rule of Community law laying down the way in which benefit is to be paid in a case such as that of Mr and Mrs Dammer . This would give free rein to national rules against overlapping . For instance, in the case of Mr and Mrs Dammer, the Commission has pointed out that, in the absence of any Community rule like Article 10(1)(b)(i ) of Regulation No 574/72 providing a solution, in the form of a rule of priority, to the problem caused by the prohibition of overlapping under Article 12(1 ) of Regulation No 1408/71, the combined effect of the Belgian and German rules against overlapping could mean that the amount of the benefits actually paid would be very small .
13 . The situation confronting the Court is, in fact, very paradoxical . Article 12(1 ) of Regulation No 1408/71 establishes a general prohibition of overlapping which encompasses cases such as that of Mr and Mrs Dammer . But there is no Community implementing provision specifying who is actually to pay the benefits and how their amount is to be determined . The national rules against overlapping therefore operate but, according to the Commission, their adverse effects are not mitigated by the application of Article 7(1)(a ) of Regulation No 574/72 . That provision provides that, if the application of Article 12(2 ) of Regulation No 1408/71 entails the reduction or concurrent suspension of benefits, no benefit "may be reduced or suspended by an amount greater than the amount obtained by dividing the sum which is subject to reduction or suspension under the legislation by virtue of which the benefit is due by the number of benefits subject to reduction or suspension to which the person concerned is entitled ". The Commission considers that the national rules against overlapping applied in a case like Mr and Mrs Dammer' s do not fall under Article 12(2 ) of Regulation No 1408/71 and are therefore not governed by Article 7(1)(a ) of Regulation No 574/72 . In its view, Article 12(2 ) applies only to cases in which overlapping benefits accrue to one person, with the emphasis on the word "one ".
14 . In other words, if the Commission' s interpretation is accepted, Community law, by its apparent silence, gives free rein to national rules against overlapping without bothering about the effects which those rules may have . Such an unfair result must, I think, lead us to consider whether the Commission' s interpretation of Article 12(2 ) of Regulation No 1408/71 is not unduly restrictive . As I have already suggested, I do not think that either the wording of that provision or the grounds of the Court' s judgment in Bakker, cited above, preclude the view that the legislative provisions of a Member State reducing benefits in the event of family benefits paid to one parent overlapping with those paid, for the same child and in respect of the same period, to the other parent fall under Article 12(2 ).
15 . One of the aims of Regulation No 1408/71 is to ensure that the Community rules of coordination in the field of social security do not give rise to "unjustified overlapping ". ( 4 ) Those of its provisions which are devoted to the overlapping of benefits should, in principle, pursue that aim . Where benefits relate to old age or invalidity, it is perfectly understandable to consider that there must be only one entitled person . It is not immediately obvious how a situation in which such benefits are payable to different people could be unjustified . However, strict adherence to the concept of the single recipient in the field of family benefits has the effect that, for no clear reason, certain cases of overlapping are taken out of the scope of the provisions in question . This occurs in cases where each parent qualifies for family benefits for the same period and for the same child . An interpretation leading to such a result does not, in my view, coincide with the aim of avoiding "unjustified overlapping ". It would, moreover, appear to be contradicted to a certain extent by Article 10(1)(b)(i ) of Regulation No 574/72, which, as we have seen, contains an anti-overlapping provision concerning a situation in which each parent can claim family benefits in respect of the same child .
16 . I consider, therefore, that the interpretation of the concept of the single recipient to be adopted is rather one which meets the objective of avoiding unjustified overlapping for all the kinds of benefits covered by the Community rules . Certain of those benefits, such as family benefits, by their nature give rise to the "unjustified overlapping" - within the meaning of the preamble to Regulation No 1408/71 - of the entitlements of two recipients . Therefore, one must not adhere too strictly to the idea that there must be only one entitled person .
17 . I would add that strict adherence to that idea would not, as might be thought, have the result, by limiting the scope of the prohibition of overlapping, of enabling the parents to accumulate their respective benefits . On the contrary, it may have a perverse effect, as the case of Mr and Mrs Dammer shows . If such a case did not fall within the scope of Article 12(2 ) of Regulation No 1408/71, the result would not be to prevent the national rules against overlapping from taking effect, but rather to prevent the "mitigating rule" contained in Article 7(1)(a ) of Regulation No 574/72 from applying to them . As a consequence, far from receiving two full benefits, the parents might receive only very small amounts because of the "overlapping of national rules against overlapping ".
18 . In my opinion, therefore, the idea of there being only one entitled person, which Article 12(2 ) of Regulation No 1408/71 appears to indicate, must not be adhered to too strictly so that cases in which each parent qualifies, in a Member State in which he or she works but does not reside, for family benefits for the same child and in respect of the same period are not excluded from the scope of that provision . In such situations the operation of national rules against overlapping benefits is governed by the "mitigating rule" in Article 7(1)(a ) of Regulation No 574/72 . I propose that an answer to that effect should be given to the national court' s second question .
19 . The Commission, which, for its part, suggested that the Court should rule that Article 7(1)(a ) applied by analogy to situations such as that of Mr and Mrs Dammer, added that, in accordance with the judgment in Kromhout, ( 5 ) such an application must be accompanied by the proviso that if the total amount of the two national benefits reduced by the application of the national overlapping rules is lower than that of the higher national benefit, a supplement equal to the difference between that amount and the total must be paid by the institution of the Member State whose legislation provides for the highest amount . That reference to the decision in Kromhout may seem surprising in view of the fact that, according to the explanations given by the Commission at the hearing, a straightforward application of Article 7(1)(a ) of Regulation No 574/72 would mean that the parents received a total amount equal to the highest benefit . It might, however, be not unhelpful to refer to the decision in Kromhout in the answers to the national court' s questions, since some doubt may remain as to the actual scope of Article 7(1)(a ).
20 . Finally, I would point out that if the national court' s second question is answered on the basis of Article 12(2 ) of Regulation No 1408/71, the date from which the non-overlapping applies need not, in my view, be specified . I derive that opinion from two series of considerations .
21 . First, it must be observed that, in the context of the provision in question, such a specification would concern the dates of application of the national overlapping rules . However, in all probability, those dates are determined by provisions of national law . As a result, if the Court were to rule on this point, it would be interpreting national law, and that is not its task .
22 . Furthermore, I think that the reasoning underlying the answers which I suggest the Court should give renders the national court' s question as to the date of application of the rule against overlapping superfluous . If Article 12(1 ) prohibits the overlapping of family benefits of the same kind for the same period in cases such as that of Mr and Mrs Dammer and if, in the absence of any elaboration of that prohibition by means of an implementing provision similar to Article 10(1)(b)(i ) of Regulation No 574/72, the national overlapping rules referred to in Article 12(2 ) apply, subject to the mitigating effect of Article 7(1)(a ) of Regulation No 574/72, only two situations can be envisaged . The first is where the legislation of two Member States grants entitlement to benefits for the same child and for the same period . Overlapping, which is in fact possible, is prohibited in law in the manner I have just described . The second is where there is no "double conferment" of entitlement to benefits for the same child and for the same period . In that event, there is no de facto possibility for overlapping to occur . In those circumstances, I can see no point in determining the date from which overlapping is to stop, for this would require the "non -overlapping" to be preceded by "lawful" overlapping . And in the system I have described, there is no place for such overlapping .
23 . I therefore propose that the Court should rule as follows :
"( 1)Article 73(1 ) of Regulation No 1408/71 does not enable parents working in two Member States other than the State in which they reside together with their child to exercise a choice whereby that child is regarded as residing in only one of the States of employment so that entitlement to the actual payment of family benefits arises under the legislation of that State alone .
( 2)The application of provisions for the reduction, suspension or withdrawal of benefits, for which the laws of the two States of employment provide in the event of the overlapping of the family benefits payable in each of those States to one of the parents pursuant to the aforesaid Article 73(1 ), falls within the scope of Article 12(2 ) of Regulation No 1408/71 and is consequently restricted in its effects by Article 7(1)(a ) of Regulation No 574/72, with the proviso that the total amount paid may not be lower than the amount of the highest benefit ."
(*) Original language : French .
( 1 ) OJ, English Special Edition 1971 ( II ), p . 416 .
( 2 ) OJ, English Special Edition 1972 ( I ), p . 159 .
( 3 ) Case 151/87 Bakker v Rijksdienst voor Werknemerspensioenen (( 1988 )) ECR 2009 .
( 4 ) Preamble to Regulation No 1408/71, seventh recital .
( 5 ) Judgment of 4 July 1985 in Case 104/84 Kromhout v Raad van Arbeid (( 1985 )) ECR 2205 .
Full & Egal Universal Law Academy