Opinion of the Advocate-General
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My Lords,
1 . The issue in this case is whether Belgian rules against the overlapping of benefits prevent the grant of Belgian early retirement pensions to two Italian former migrant workers who are already in receipt of Italian invalidity pensions .
2 . Mr Pian was born on 9 June 1922 . He worked in Belgium from 1947 to 1951 as a miner and from 1951 to 1971 in other salaried posts . After returning to Italy and further employment there, he became eligible for an Italian invalidity pension on 1 March 1974 . With effect from 1 March 1978 he was granted a Belgian retirement pension on the basis of his periods of employment as a miner, having reached the special miners' retirement age of 55 years . However, his application of 4 June 1982 for an early retirement pension on the basis of his further periods of insurance completed in Belgium was refused by the Office national des pensions ( the "Office national ").
3 . Mr Bianchin was born on 20 February 1920 . From 1955 to 1961 he worked in Belgium and then returned to Italy where, after a further period of employment, he became eligible for an invalidity pension on 1 January 1975 . On 25 March 1983 he applied to the Office national for an early retirement pension on the basis of insurance periods completed in Belgium . The application was refused by decision of 23 March 1984 .
4 . In refusing the applications for early retirement pensions, the Office national relied on Article 25 of Royal Decree No 50 of 24 October 1967 on old-age and survivors' pensions for salaried workers in conjunction with Article 64(a)(1 ) of the Royal Decree of 21 December 1967 laying down general rules for retirement and survivors' pensions for salaried workers, which implements Article 25 of Royal Decree No 50 . The Office national took the view that the effect of those provisions was that the existence of an Italian invalidity pension precluded the grant of an early retirement pension .
5 . Mr Pian' s appeal against the decision of the Office national was rejected by judgment of the tribunal du travail, Liège, of 9 May 1985 . The same court upheld Mr Bianchin' s appeal on 11 June 1986 . The cour du travail of Liège, on appeals against the judgments at first instance, referred the following questions to the Court :
"( 1 ) Where a migrant worker has become entitled to a personal invalidity pension in one Member State, without application of the Community regulations, and asserts in another Member State rights to a benefit on the basis of his employment, without application of the Community regulations, is it compatible with Articles 48 and 51 of the Treaty of Rome for the institution in the second State which grants the retirement pension to take into account the invalidity pension granted by the first State in order to apply the rules laid down in its own legislation for the prevention of overlapping benefits, just as it takes into account invalidity benefits granted under its own legislation?
( 2 ) If so, where the legislation of a Member State treats in a different manner the overlapping of a retirement pension granted under such legislation with an invalidity benefit or an old-age benefit, how must an invalidity pension granted by another Member State which is not convertible into an old-age pension be treated : must it be treated as an invalidity benefit or as an old-age benefit?
Should a distinction possibly be made according to whether or not the recipient of the invalidity pension has reached retirement age or is receiving an old-age benefit?
Must a distinction be drawn according to whether the retirement pension is claimed at the normal age or is applied for early ( with a reduction of the amount )?
( 3 ) With reference to Questions 1 and 2, must the retirement age be
( a ) that prescribed by the legislation containing the provision on overlapping benefits, or
( b ) that laid down by the legislation providing for the non-convertible benefit to which the rules on overlapping benefits are applied?"
6 . In its first question, the national court in effect asks whether, in a case where entitlement to an old-age pension arises under the legislation of one Member State alone, Community law permits the application of the legislation of that Member State relating to the overlapping of benefits . The second and third questions essentially ask whether, if Community law permits the application of anti-overlapping legislation, it also permits, for the purposes of that legislation, the application of national rules concerning the classification of benefits arising under the law of another Member State and concerning the age at which entitlement to a retirement pension arises .
7 . Although the questions are framed in terms of Articles 48 and 51 of the EEC Treaty, it is clear that they must be answered by reference to the legislation adopted pursuant to Article 51, in particular Council Regulation No 1408/71 ( Official Journal, English Special Edition 1971 ( II ), p . 416; consolidated version, Official Journal 1983, L 230, p . 8 ).
8 . According to well-established case-law, where a worker receives a pension by virtue of national legislation alone, the provisions of Regulation No 1408/71 do not prevent that legislation from being applied to him in its entirety, including any national rules against the overlapping of benefits ( see judgments of 2 July 1981 in Joined Cases 116 and 117, and 119 to 121/80 RWP v Celestre (( 1981 )) ECR 1737, paragraph 9, of 6 October 1987 in Case 197/85 ONPTS v Stefanutti (( 1987 )) ECR 3855, paragraph 10, and of 18 April 1989 in Case 128/88 Di Felice v Inasti (( 1989 )) ECR 923, paragraph 9 ).
9 . However, the Court has always qualified the above ruling with an important proviso, which is that if the application of the national legislation alone proves to be less favourable to the worker than the application of the rules laid down in Article 46 of Regulation No 1408/71, the provisions of that article must be applied ( see Celestre, cited above, paragraph 9; Stefanutti, cited above, paragraph 11; Di Felice, cited above, paragraph 9 ). The national court must therefore determine whether the application of national legislation alone, or the application of the provisions of Article 46, will produce a result which is more favourable to Mr Pian and Mr Bianchin .
10 . In applying the provisions of national legislation, the national court is plainly entitled to apply that legislation in its entirety, including not only, as already mentioned, any provisions against the overlapping of benefits, but also provisions concerning the classification of benefits obtained under foreign legislation or conditions concerning the age at which entitlement to a retirement pension arises . Since at this stage these issues are governed by national law, no question of Community law arises .
11 . Next it is necessary to consider the application of Article 46 . Where, as here, a person' s entitlement to benefit arises without its being necessary to have recourse to insurance periods completed in other Member States, there are two main stages in the application of Article 46 . First, the national court must, in accordance with its own legislation, "determine the amount of benefit corresponding to the total length of the periods of insurance or residence to be taken into account in pursuance of such legislation" ( Article 46(1 ), first subparagraph ). Secondly, it must also calculate the benefit that would be due under the system of aggregation and apportionment laid down in Article 46(2)(a ) and ( b ). Only the higher of the two amounts calculated in this way is to be taken into consideration ( Article 46(1 ), second subparagraph ).
12 . In applying Belgian legislation for the purposes of the first subparagraph of Article 46(1 ), the national court is of course entitled to consider whether the conditions for the grant of a retirement pension or of an early retirement pension are fulfilled .
13 . However, the Court has consistently held that, where the provisions of Article 46 are applied, it follows from the final sentence of Article 12(2 ) of the regulation that national rules against overlapping of benefits must be left out of account when the person concerned receives benefits of the same kind in respect of invalidity, old age or death ( see Celestre, paragraph 12; Stefanutti, paragraph 12 ). Where benefits are of the same kind, national rules against overlapping are excluded even where the first subparagraph of Article 46(1 ) is applied . In Di Felice, which was decided after the present cases had been referred, the Court ruled at paragraph 16 that an early retirement pension to which entitlement arises under the legislation of one Member State, and an invalidity pension to which entitlement arises under the legislation of another Member State, are to be regarded as benefits of the same kind within the meaning of Article 12(2 ) of Regulation No 1408/71 .
14 . It follows that in calculating the amount of benefit to which Mr Pian and Mr Bianchin would be entitled under Article 46(1 ), first subparagraph, the national court must leave out of consideration the rules against overlapping contained in Article 25 of Royal Decree No 50 of 24 October 1967 and Article 64(1 ) of the Royal Decree of 21 December 1967 . The amount to be taken into consideration under that provision is therefore the amount to which they would be entitled under Belgian legislation if they were not in receipt of an Italian invalidity pension ( judgment of 13 March 1986 in Case 296/84 Sinatra v FNROM (( 1986 )) ECR 1047; Celestre, paragraph 12 ). Since only Belgian legislation is taken into consideration, and since the national rules against overlapping are excluded, the further questions raised by the national court, namely the applicable pension age and the classification of foreign benefits, do not at this stage arise .
15 . As already mentioned, the national court must then proceed to apply Article 46(2)(a ) and ( b ) and to apply the higher of the two amounts resulting from the application of those provisions and the application of Article 46(1 ), first subparagraph, respectively . If appropriate, the resulting amount must be reduced in accordance with Article 46(3 ), which places a ceiling on the amount of benefit which a worker can acquire pursuant to Article 46, a ceiling which corresponds to the highest theoretical amount of benefits calculated according to Article 46(2)(a ). Article 46(3 ) applies to the exclusion of national rules against overlapping ( see judgment of 5 May 1983 in Case 238/81 Raad van Arbeid v Van der Bunt-Craig (( 1983 )) ECR 1385, paragraph 15; Di Felice, paragraph 9 ).
16 . Finally, the national court must compare the benefit which would be payable under Belgian legislation in its entirety, including its rules against overlapping, with that which would be payable under the provisions of Article 46 . If the latter is more favourable to Mr Pian and Mr Bianchin, that is the benefit to which they are entitled . Since the application of Belgian legislation in its entirety, including the rules against overlapping, would result in their not being entitled to a Belgian early retirement pension, it is to be expected that the application of Article 46, which excludes the operation of those rules, will prove more favourable to them .
17 . Accordingly, I would give the following answers to the questions referred by the national court :
"( 1 ) Where a person is entitled to a pension by virtue of national legislation alone, the provisions of Regulation No 1408/71 do not prevent that legislation from being applied to him in its entirety, including any national rules against overlapping benefits and any national rules concerning the classification of benefits which he receives under the legislation of another Member State or concerning the age at which entitlement to the pension arises . If, however, the application of that national legislation proves to be less favourable to him than application of the provisions laid down in Article 46 of Regulation No 1408/71, the provisions of that article must be applied . In the latter circumstances, Article 46(3 ) is applicable to the exclusion of the rules against overlapping of benefits contained in the national legislation .
( 2 ) An early retirement pension to which a person is entitled under the legislation of one Member State, and an invalidity pension to which he is entitled under the legislation of another Member State, are to be regarded as benefits of the same kind within the meaning of Article 12(2 ) of Regulation No 1408/71 . Consequently, for the purpose of determining the amount referred to in the first subparagraph of Article 46(1 ) of Regulation No 1408/71, the application of national rules against overlapping is precluded ."
(*) Original language : English .
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