G. J. J. De Jong v Bestuur van de Sociale Verzekeringsbank (254/84)

Contents

Judgment of the Court (Fifth Chamber)25 February 1986^noteIn Case 254/84REFERENCE to the Court under Article 177 of the EEC Treaty by the Raad van Beroep [Social Security Court], Amsterdam, for a preliminary ruling in the action pending before that court betweenG. J. J. De JongandBestuur van de Sociale Verzekeringsbank [Board of Management of the Social Insurance Bank], Amsterdam,THE COURT (Fifth Chamber)composed of: U. Everling, President of Chamber, R. Joliét, O. Due, Y. Galmot and C. Kakouris, Judges,Advocate General: G. F. ManciniRegistrar: D. Louterman, Administratorafter considering the observations submitted on behalf of— the Sociale Verzekeringsbank by Mr ter Kuile in the written procedure and by Mr ter Kuile and Mr Pijnacker at the hearing,— the Netherlands Government by Mr Verkade in the written procedure,— the Commission of the European Communities by Mr Griesmar and Mr Herbert in the written procedure and by Mr Herbert at the hearing,after hearing the Opinion of the Advocate General delivered at the sitting on 21 January 1986,gives the following

Judgment

(The account of the facts and issues which is contained in the complete text of the judgment is not reproduced)

Decision

1By an order of 19 October 1984 which was received at the Court on 29 October 1984, the Raad van Beroep, Amsterdam, referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty a question concerning the interpretation of Article 51 of the EEC Treaty and Annex VI, Part I, Point 2 of Council Regulation No 1408/71 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 (Official Journal 1983, L 230, p. 8). The purpose of the question is to enable the Raad van Beroep to determine the periods to be taken into account in respect of a married woman for the purposes of the calculation of the old-age pension payable under the Netherlands Algemene Ouderdomswet [General Law on Old-Age, hereinafter referred to as ‘the Old-Age Law’].

2The question was raised in an action between G. J. J. De Jong, an employed person of Netherlands nationality, and the Bestuur van de Social Verzekeringsbank [hereinafter referred to as ‘the Verzekeringsbank’], Amsterdam. The action relates to the calculation of the old-age pension payable to a married man under the Old-Age Law, to which Mr De Jong is entitled.

3The Old-Age Law provides that any person who resides in the Netherlands and any person who is liable to income tax in respect of paid employment pursued in the Netherlands is insured under the general old-age insurance scheme. In addition, a Royal Decree of 19 October 1976 provides that any person in receipt of benefits under the Wet op de Arbeidsongeschiktheidsverzekering [Law on Insurance against Incapacity for Work, hereinafter referred to as ‘the Law on Incapacity for Work’], is insured under the Old-Age Law. The amount of the old-age pension under the Old-Age Law is determined on the basis of the number of years of insurance completed by a pensioner between his 15th and 65th birthdays. According to the Old-Age Law, as it applied at the material time, a married woman is not entitled to an old-age pension. Her husband is entitled to a married man's old-age pension, which is calculated on the basis of the insurance periods completed by himself and his wife. In determining the amount of the pension, the full married man's pension is reduced by 1 % for each year for which he or his wife was uninsured. In the case of a single person's pension, there is a reduction of 2% for each uninsured year.

4The Old-Age Law contains transitional provisions which, in certain circumstances, enable periods between the recipient's 15th birthday and 1 January 1957, the date on which the Law entered into force, to be treated as insurance periods for the purposes of the Old-Age Law. One of the conditions for the periods to be so treated is, by virtue of Article 43 of the Old-Age Law, that the person concerned must have resided in the Netherlands for an uninterrupted period of six years or for periods totalling six years since his 59th birthday. A married woman who is younger than her husband satisfies that condition if she has resided in the Netherlands for six years since her husband's 59th birthday; however, the condition was rendered less stringent by a Royal Decree of 20 December 1956, which was adopted pursuant to Article 45 of the Old-Age Law, Article 1 of which provides that periods during which a married woman was not resident in the Netherlands but was insured under the Old-Age Law are to be treated as insurance periods. In addition, under Article 44 of the Old-Age Law, a person may benefit from the transitional provisions only as long as he resides in the Netherlands; however, Article 5 of the aforesaid Royal Decree provides that, in the case of Netherlands nationals who are insured without interruption from 1 January 1957 until their 65th birthday, residence outside the Netherlands is treated as residence within that State.

5Point 2 of Part I of Annex VI to Regulation No 1408/71 (formerly Part H of Annex V thereto) contains, inter alia, the following provisions concerning the application of Netherlands legislation on general old-age insurance:(a) Periods of insurance before 1 January 1957 during which a recipient, not satisfying the conditions permitting him to have such periods treated as periods of insurance, resided in the territory of the Netherlands after the age of 15 or during which, whilst residing in the territory of another Member State, he pursued an activity as an employed person in the Netherlands for an employer established in that country, shall also be considered as periods of insurance completed in application of Netherlands legislation for general old-age insurance....(c) As regards a married woman whose husband is entitled to a pension under Netherlands legislation on general old-age insurance, periods of the marriage preceding the date when she reached the age of 65 years and during which she resided in the territory of one or more Member States shall also be taken into account as insurance periods, in so rar as those periods coincide with periods of insurance completed by he? u.sband under that legislation and with those to be taken into account in pursuance of subparagraph (a)....(f) The periods referred to in subparagraphs (a) and (c) shall only be taken into account for calculation of the old-age pension if the person concerned has resided for six years in the territory of one or more Member States after the age of 59 years and for as long as that person is residing in the territory of one of those Member States.’

6It appears from the order requesting a preliminary ruling that Mr De Jong, who was born on 27 July 1918, is married to a woman of Italian origin, who was born on 4 August 1920 and who obtained Netherlands nationality by virtue of their marriage on 30 October 1950. The married couple resided in the Netherlands from 16 February 1951 to 17 April 1982, when they moved to Italy. In 1957 Mr De Jong was recognized as unfit for work and he is in receipt of benefits under the Law on Incapacity for Work.

7When the Verzekeringsbank calculated the married man's old-age pension to which Mr De Jong has been entitled since 27 July 1983, it applied a reduction of 15%. It took the view that Mr De Jong qualified under the transitional provisions laid down in Articles 43 and 44 of the Old-Age Law and the Royal Decree of 20 December 1956, since he had been insured under the Old-Age Law without interruption from 1 January 1957, even after his departure for Italy, as a recipient of benefits under the Law on Incapacity for Work. In the case of his wife, however, the 15 years between her 15th birthday and the date on which the married couple settled in the Netherlands could not be treated as insurance periods.

8The Verzekeringsbank based its decision on the fact that Mr De Jong's wife was not insured under the Old-Age Law between the date on which she and her husband departed for Italy and the date on which Mr De Jong attained the age of 65 and consequently could not be regarded as a person residing in the Netherlands within the meaning of Articles 43 and 44 of the Old-Age Law. Although according to Point 2 (c) of Part I of Annex VI to Regulation No 1408/71 the period between the date on which they departed for Italy and Mr De Jong's 65th birthday and, moreover, the period between the date on which they settled in the Netherlands and the date on which the Old-Age Law entered into force ‘shall be taken into account as insurance periods’ in so far as those periods are periods of their marriage and coincide with periods of insurance completed by Mr De Jong, that fact did not, according to the Verzekeringsbank, render the transitional provisions contained in Article 43 of the Old-Age Law and the Royal Decree of 20 December 1956 applicable since such periods did not constitute genuine periods of insurance.

9Mr De Jong disputed the 15% reduction in his old-age pension in an action before the Raad van Beroep, Amsterdam, which considered that its decision depended on the Court's reply to the following question:‘Is it in accordance with Article 51 of the Treaty establishing the European Economic Community and with the provisions of Regulation No 1408/71 of the Council of the European Communities (in particular, the provisions of Point 2 of Part I of Annex VI to that regulation) to refuse, in determining in accordance with the Algemene Ouderdomswet [General Law on Old Age] the pension of a married man, to grant to his wife, who after 1 January 1957 completed periods in accordance with Point 2 (c) of Part I of the aforementioned Annex VI, the advantages which Netherlands law, and in particular, Articles la and 5 of the Royal Decree of 20 December 1956 (Staatsblad No 628), issued pursuant to Article 45 of the Algemene Ouderdomswet, attaches to periods of insurance?’

10The Verzekeringsbank and the Netherlands Government observe that the purpose of the provisions of Point 2 (a) of Part I of Annex VI to Regulation No 1408/71, and in particular subparagraph (c) thereof, is to confer on the person concerned entitlement to an old-age pension with regard to the period referred to therein. They are independent of the national transitional provisions. They therefore cannot be used as a means of rendering the national transitional provisions applicable with regard to periods which do not satisfy the requirements of either the national legislation or Community rules.

11In its written observations the Commission contends that, although, prima facie, there are some arguments in favour of giving Point 2 (c) a narrow interpretation, Article 51 of the EEC Treaty and the principle of freedom of movement of persons nevertheless require that that provision should be interpreted widely, so that periods covered by subparagraph (c) also constitute periods of insurance for the purposes of the national transitional provisions and in particular for the purposes of the Royal Decree of 20 December 1956. In its view, Article 51 and the principle of freedom of movement of persons require that the exercise of the right to freedom of movement should not entail the loss or reduction of the advantages to which the person concerned is entitled.

12However, at the hearing the Commission adopted the opinion of the Verzekeringsbank and the Netherlands Government and contended that the provisions of Point 2 (c) of Part I of Annex VI could not give rise to entitlement to insurance under national law. Moreover, voluntary insurance, entailing a contribution of the same amount as that which would have been payable had the person concerned continued to reside in the Netherlands, would enable him to avoid any loss of benefits.

13In that respect it must be pointed out that, as the Court stated in its judgment of 24 April 1980 in Case 110/79 (Coonanv Insurance Officer [1980] ECR 1445), it is for the legislature of each Member State to lay down the conditions creating the right or the obligation to become affiliated to a social security scheme or to a particular branch under such a scheme, provided always that in this connection there is no discrimination between nationals of the host State and nationals of the other Member States.

14It is true that the provisions of Regulation No 1408/71 were adopted to implement Article 51 of the EEC Treaty and must be interpreted in the light of the objective of Article 51, which is to contribute to the establishment of the greatest possible freedom of movement for migrant workers, which is one of the foundations of the Community.

15Article 51 requires the Council to adopt such measures in the field of social security as are necessary to provide freedom of movement for workers by securing, inter alia, payment of benefits for persons resident in the territories of the Member States. The aim of Articles 48 to 51 would not be attained if, as a consequence of the exercise of their right to freedom of movement, workers were to lose the advantages in the field of social security guaranteed to them by the laws of a single Member State.

16In the light of those considerations it is apparent that the purpose of Point 2 (c) is to facilitate the free movement of workers from other Member States who move to the Netherlands whilst their wives remain in the country of origin, by enabling the periods during which the wives are resident in another Member State to be taken into account. Such periods may be taken into account provided that they are periods of the marriage and coincide with periods of insurance completed by the husband or periods which are to be taken into account in pursuance of Point 2 (a). The objective of that provision does not require that it should also be possible to take account, by virtue of the combined effect of Point 2 (c) and the national transitional provisions, of periods prior to the marriage. Such periods may only be taken into account if the requirements of Point 2 (a), as defined by the Court in its judgment of today's date in Case 284/84 (Spruytv Bestuur van de Sociale Verzekeringsbank), are satisfied, which is not the case in relation to periods during which a married woman has neither resided nor pursued an activity as an employed person in the territory of the Netherlands.

17Although, in this case, such periods were nevertheless taken into account in respect of Mr De Jong, this is because, as a recipient of Netherlands benefits in respect of his incapacity for work, he was insured under the Old-Age Law and, unlike his wife, he satisfied the conditions of the Royal Decree of 20 December 1956. That does not constitute a difference in treatment amounting to discrimination either under Community law or under the national transitional provisions.

18In a case such as this, the fact that periods prior to the marriage during which a married woman did not reside in the Netherlands are not taken into account when she moves to another Member State with her husband cannot therefore be regarded as an obstacle to their freedom of movement. Moreover, as the Verzekeringsbank, the Government of the Netherlands and the Commission have stated in reply to a question put by the Court, voluntary insurance under the Old-Age Law provides a means of avoiding that consequence. Since, in the event of voluntary insurance, the Netherlands benefits payable in respect of incapacity for work, which themselves give rise to liability to pay contributions under the Old-Age Law, are not taken into account in calculating the contribution to be paid by the husband, the resulting financial burden will be no greater than it would have been if his wife had continued to be subject to compulsory insurance in the Netherlands.

19The answer to the questions referred to the Court by the Raad van Beroep, Amsterdam, should therefore be that neither Article 51 of the EEC Treaty nor the provisions of Regulation No 1408/71, and in particular Point 2 (c) of Part I of Annex VI thereto, require that, when the pension of a married man is determined under the Algemene Ouderdomswet [General Law on Old-Age], his wife, who after 1 January 1957 completed periods in accordance with Point 2 (c), must be granted the advantages provided for by Netherlands legislation, and in particular by the Royal Decree of 20 December 1956, in respect of periods prior to their marriage and prior to 1 January 1957 during which she neither resided in the Netherlands nor pursued an activity as an employed person in that country.

Costs

20The costs incurred by the Netherlands Government and the Commission of the European Communities, which have submitted observations to the Court, are not recoverable. As these proceedings are, in so far as the parties to the main proceedings are concerned, a step in the proceedings brought before the national court, the decision on costs is a matter for that court.

Operative part

On those grounds,THE COURT (Fifth Chamber),in answer to the question referred to it by the Raad van Beroep, Amsterdam, by order of 19 October 1984, hereby rules: Neither Article 51 of the EEC Treaty nor the provisions of Regulation No 1408/71, and in particular Point 2 (c) of Part I of Annex VI thereto, require that, when the pension of a married man is determined under the Algemene Ouderdomswet [General Law on Old-Age], his wife, who after 1 January 1957 completed periods in accordance with Point 2 (c), must be granted the advantages provided for by Netherlands legislation, and in particular by the Royal Decree of 20 December 1956, in respect of periods prior to their marriage and prior to 1 January 1957 during which she neither resided in the Netherlands nor pursued an activity as an employed person in that country.

Delivered in open court in Luxembourg on 25 February 1986.