SARL Prodest v Caisse Primaire d'Assurance Maladie de Paris (237/83)

II —Written observations submitted to the Court

According to the defendant, a national of a Member State of the European Economic Community may rely upon the provisions of Community regulations only with respect to work to which he is assigned within another Member State of the Community. In the present case, whilst on the hand the worker in question is indeed a national of one of the Member States, he was, on the other hand, assigned to work not in a Member State but in a nonmember country.The defendant therefore considers that it was entitled to refuse to maintain Mr van Robaeys's insurance under the French general social security scheme for the duration of his posting to Nigeria.In its written observations, the Commission states that the question seeks essentially to define the field of application of the principle of freedom of movement for workers. In fact, the point at issue is whether the second paragraph of Article 39 of the Law of 3 January 1972 relates also to the employment of Community nationals for activities performed outside the territory of the Community.Although, in general terms, that paragraph appears to embody discrimination based on nationality, which is contrary to Community law in so far as it is unfavourable to nationals of other Member States assigned to work for a period outside French territory but within the Community, it should be noted, according to the Commission, that Article L 341-1 of the same Labour Code provides that:“The provisions of the present title shall, where appropriate, apply without prejudice to treaties, conventions or agreements duly ratified or approved and published and in particular the treaties establishing the European Communities and the measures adopted by the Community authorities in implementation thereof.”The question remaining to be considered, which is precisely the question with which the present case is concerned, is therefore whether, in so far as it refers to activities performed outside the Community, Article L 341-3 falls within the field of application of Community law, in which case it is not applicable to the present case.According to the Commission, prima facie three approaches would appear possible:(i) Community law applies to employment relationships which are entered into within the Community and/or which give rise to tasks or services within the Community;(ii) Community law applies to all such employment relationships, regardless of the place where the tasks or services are performed (inside or outside the Community);(iii) Community law applies to all activities carried out within the Community regardless of where the employment contract is concluded.The Commission then reviews the Community legislation which it considers may be applicable. It concludes that the provisions of Articles 3 (c), 48 (1), (2) and (3), 49 (b) and (c), 52 and 59 of the Treaty appear to favour free access to work rather than the freedom to perform work, which is equivalent, in the case of employed persons, to free access to the labour market, regardless of the place where the activity is carried out. The Commission also examines the regulations and directives relating to freedom of movement for workers, but observes, in that connection, that as a result of divergences of terminology it is not possible to formulate a decisive conclusion regarding determination of the connecting factor for defining the precise field of application ratione materiae of the principle of the free movement of persons. It seems to the Commission that the authors of the provisions in question intended to cover in any event, among the possible kinds of discrimination, only those kinds which constitute the most immediate and substantial obstacle.The Commission examines the decisions of the Court concerning the free movement of persons, and in particular the judgment of 24 October 1974 (Case 36/74 Walrave ECR 1974, 1405) and states that the Court has had recourse to a connecting factor which extends the field of application of Community law beyond the area covered by the two criteria in question, namely access to employment and the carrying out of activities. According to the approach adopted in the Walrave judgment, the principle of equality of treatment also governs employment relationships entered into outside the Community, under which the work is also performed outside the Community, provided that in some way those relationships have repercussions for the employment situation within the Community.As regards the specific area of social security, the Commission refers in particular to the judgments of 8 April 1976 (Case 112/75 Hirardin [1976] ECR 553), of 31 March 1977 (Case 87/76 Bozzone [1977] ECR 687) and of 11 July 1980 (Case 150/79 Commission v Belgium [1980] ECR 2621). Those decisions confirm, in its opinion, the tenor of the Walrave judgment cited above, in particular the fact that the applicability of Community law is not in any case dependent upon the place where the activity is performed.From those decisions of the Court, the Commission infers that legal relationships originating within the territory of the Community fall within the field of application of Community law. That conclusion necessarily follows from considerations relating both to the objectives of the Treaty and to practical grounds.In the Commission's view, the fundamental character of the principle of equality of treatment embodied in the Community legal order, implies, as is apparent from the very terms of Article 48 (2) of the Treaty which refers to discrimination “as regards employment, remuneration and other conditions of work and employment”, that an employment relationship originating in the Community should be considered in its entirety.True equality of treatment can in fact only be guaranteed if it covers all aspects of an activity. Moreover, in its judgments on the interpretation of Article 7 (2) of Regulation No 1612/68, the Court has confirmed that the principle of equality of treatment must facilitate the maximum possible integration, of a migrant worker and his family in the host Member State (see judgment of 30. 9. 1975 in Case 32/75 Cristini [1975] ECR 1085).The Commission also observes that statutory or contractual provisions under which a State's own nationals are treated differently from other Community nationals with regard to the pursuit of an activity in a country outside the Community indisputably have repercussions on the employment market within the Community. They are likely, for example, to exclude Community nationals from certain jobs, thus affecting their career development by comparison with that of the nationals of the State in question. A provision like the one at issue here also affects undertakings established in the Member State in question which would be prevented from obtaining the services of the best qualified staff. There would be other substantial disadvantages of a practical nature for economic activities, by reason of the essentially mobile nature of those activities. For numerous kinds of employment involving activities performed outside the Community, non-applicability of the rule of equality of treatment would make it possible systematically to recruit other Community nationals on less favourable conditions of employment or remuneration than those enjoyed by the State's own nationals, and that discrimination against other Community nationals might even have adverse effects on the employment of nationals of the State concerned.Finally, the Commission points to the legal uncertainty to which Community nationals would be exposed if Community provisions were applied differently depending on the place where an activity was performed, at a time when occupational mobility is so important.The Commission concludes that the principle of equality of treatment applies in relation to the free movement of persons where a Community national residing in a Member State is bound by a contract of employment concluded with an employer who is a national of the host Member State, his situation being governed, as the defendant shows by referring to the prohibition clause in Article L 341, by the legislation of the latter State, regardless of the place where his activity as an employed person is carried on (inside or outside the Community). It follows, in the Commission's opinion, that the refusal to maintain insurance in this case can in no circumstances be based on the third paragraph of Article L 341-3 of the Labour Code.The Commission then goes on to ask whether a Community national residing and employed in France is entitled to maintain his insurance under the French social security scheme during his posting to a nonmember country. That question falls within the field of application of Regulation No 1408/71 of the Council of 14 June 1971 on the application of social security schemes to employed persons and their families moving within the Community (Official Journal, English Special Edition 1971 (II), p. 416).The Commission points out that by virtue of Article 2 thereof, that regulation applies to workers who have been subject to the legislation of one or more Member States and are nationals of one of the Member States or who are stateless persons or refugees residing within the territory of one of the Member States, and also to the members of their families and their survivors. Article 13 er seq., which govern determination of the applicable legislation and therefore of the scheme by which the person concerned is to be covered, do not deal with the matter of cover, if any, where work is performed outside the Community.In the Commission's view, the answer to the question submitted for a preliminary ruling must be based on the national legislation and on the principle of equality of treatment, as formulated, with respect to the field of application of Regulation No 1408/71 aforesaid, in Article 3 thereof.The Commission refers to the relevant French legislation, namely Article L 768 and L 769 of the Code de la Sécurité Sociale [French Social Security Code], which provides as follows:Article L 768“Workers who are sent by their employer to work abroad temporarily as employees or in a capacity assimilated thereto, and who remain subject to French social security legislation by virtue of international conventions or arrangements, shall be deemed, for the purposes of the application of that legislation, to have their residence and place of work in France.”Article L 769“If they are not, or are no longer, covered by Article L 768, workers who are sent by their employer to work abroad temporarily as employees or in a capacity assimilated thereto, and whose remuneration is paid by that employer, shall be subject to French social security legislation, provided that the employer undertakes to pay all the contributions due.The maximum period for which the workers referred to in the foregoing paragraph may be subject to French social security legislation shall be fixed by means of regulations. For the purposes of the application of that legislation, they shall be deemed to have their residence and place of work in France.”It must in fact be concluded that Mr van Robaeys unquestionably falls within the field of application of Article L 769 and must accordingly be subject to French legislation, in accordance with the conditions laid down in that article, in the same way as a French national.On the basis of the foregoing, the Commission proposes that an answer be given in the following terms :“Regulation No 1612/68 of the Council of 15 October 1968 on freedom of movement for workers within the Community must be interpreted as meaning that the prohibition of discrimination laid down in particular in Article 1 and Article 3 (1) thereof applies to the assessment of national provisions regarding work performed outside the Community by a Community national, bound by a contract of employment entered into with an undertaking established in the Community.”