JUDGMENT OF THE COURT (Fifth Chamber)

5 March 1998 (1)

(Regulation (EEC) No 1408/71 — Worker who has not exercised the right tofreedom of movement — Retired civil servant — Article 73 — Family benefits —German institution competent — Article 77 — National legislation)

In Case C-194/96,

REFERENCE to the Court under Article 177 of the EC Treaty by theBundessozialgericht (Germany) for a preliminary ruling in the proceedings pendingbefore that court between

Hilmar Kulzer

and

Freistaat Bayern

on the interpretation of Articles 2(3), 73 and 77 of Council Regulation (EEC)No 1408/71 of 14 June 1971 on the application of social security schemes toemployed persons, to self-employed persons and to members of their familiesmoving within the Community, as amended and updated by Council Regulation(EEC) No 2001/83 of 2 June 1983 (OJ 1983 L 230, p. 6), as amended by CouncilRegulation (EEC) No 3427/89 of 30 October 1989 (OJ 1989 L 331, p. 1), then byCouncil Regulation (EEC) No 1247/92 of 30 April 1992 (OJ 1992 L 136, p. 1),

THE COURT (Fifth Chamber),

composed of: C. Gulmann, President of the Chamber, J.C. Moitinho de Almeida,D.A.O. Edward (Rapporteur), J.-P. Puissochet and P. Jann, Judges,

Advocate General: N. Fennelly,

Registrar: H.A. Rühl, Principal Administrator,

after considering the written observations submitted on behalf of:

—    Mr Kulzer, by Michael Kaplitz, Rechtsanwalt, Schwandorf,

—    the Commission of the European Communities, by Peter Hillenkamp, LegalAdviser, acting as Agent,

having regard to the Report for the Hearing,

after hearing the oral observations of the Commission at the hearing on16 September 1997,

after hearing the Opinion of the Advocate General at the sitting on23 October 1997,

gives the following

Judgment

1.

    By order of 30 April 1996, received at the Court on 10 June 1996, theBundessozialgericht (Federal Social Court) referred to the Court for a preliminaryruling under Article 177 of the EC Treaty two questions on the interpretation ofArticles 2(3), 73 and 77 of Council Regulation (EEC) No 1408/71 of 14 June 1971on the application of social security schemes to employed persons, to self-employedpersons and to members of their families moving within the Community, asamended and updated by Council Regulation (EEC) No 2001/83 of 2 June 1983(OJ 1983 L 230, p. 6), as amended by Council Regulation (EEC) No 3427/89 of30 October 1989 (OJ 1989 L 331, p. 1), then by Council Regulation (EEC)No 1247/92 of 30 April 1992 (OJ 1992 L 136, p. 1) (hereinafter 'the Regulation‘).

2.

    Those questions were raised in proceedings between Mr Kulzer and FreistaatBayern (Free State of Bavaria) concerning the grant of an allowance in respect ofhis dependent child.

Community law

3.

    The fourth and fifth recitals in the preamble to Regulation No 1408/71 in itsoriginal form (OJ, English Special Edition, 1971 (II), p. 416) are worded as follows:

'... the considerable differences existing between national legislations as regards thepersons to whom they apply make it preferable to establish the principle that theRegulation applies to all nationals of Member States insured under social securityschemes for employed persons;

... the provisions for co-ordination of national social security legislations fall withinthe framework of freedom of movement for workers who are nationals of MemberStates and should, to this end, contribute towards the improvement of theirstandard of living and conditions of employment, by guaranteeing within theCommunity firstly equality of treatment for all nationals of Member States underthe various national legislations and secondly social security benefits for workersand their dependents regardless of their place of employment or of residence‘.

4.

    Article 1(a) of the Regulation states that, for the purposes of the Regulation:

'(a)    ”employed person” and ”self-employed person” mean respectively:

    (i)    any person who is insured, compulsorily or on an optional continuedbasis, for one or more of the contingencies covered by the branchesof a social security scheme for employed or self-employed persons;

    (ii)    any person who is compulsorily insured for one or more of thecontingencies covered by the branches of social security dealt with inthis Regulation, under a social security scheme for all residents or forthe whole working population, if such person:

        —    can be identified as an employed or self-employed person byvirtue of the manner in which such scheme is administered orfinanced, or,

        —    failing such criteria, is insured for some other contingencyspecified in Annex I under a scheme for employed or self-employed persons, or under a scheme referred to in (iii), eithercompulsorily or on an optional continued basis, or, where nosuch scheme exists in the Member State concerned, complieswith the definition given in Annex I;

    (iii)    any person who is compulsorily insured for several of thecontingencies covered by the branches dealt with in this Regulation,

under a standard social security scheme for the whole rural populationin accordance with the criteria laid down in Annex I;

    (iv)    any person who is voluntarily insured for one or more of thecontingencies covered by the branches dealt with in this Regulation,under a social security scheme of a Member State for employed orself-employed persons or for all residents or for certain categories ofresidents:

        —    if such person carries out an activity as an employed or self-employed person, or

        —    if such person has previously been compulsorily insured for thesame contingency under a scheme for employed or self-employed persons of the same Member State‘.

5.

    The first subparagraph of Article 1(j) provides that '”legislation” means in respectof each Member State statutes, regulations and other provisions and all otherimplementing measures, present or future, relating to the branches and schemesof social security covered by Article 4(1) and (2) or those special non-contributorybenefits covered by Article 4(2a)‘.

6.

    Article 2(1) and (3) states:

'1.    This Regulation shall apply to employed or self-employed persons who areor have been subject to the legislation of one or more Member States and who arenationals of one of the Member States or who are stateless persons or refugeesresiding within the territory of one of the Member States, as well as to themembers of their families and their survivors.

...

3.    This Regulation shall apply to civil servants and to persons who, inaccordance with the legislation applicable, are treated as such, where they are orhave been subject to the legislation of a Member State to which this Regulationapplies.‘

7.

    Article 4(4) provides:

'This Regulation shall not apply to social and medical assistance, to benefitschemes for victims of war or its consequences, or to special schemes for civilservants and persons treated as such.‘

8.

    Article 73 provides that an employed or self-employed person subject to thelegislation of a Member State is, in principle, to be entitled, in respect of themembers of his family who are residing in another Member State, to the family

benefits provided for in the legislation of the former State, as if they were residingin that State.

9.

    Article 77(2)(a) provides:

'2.    Benefits shall be granted in accordance with the following rules, irrespectiveof the Member State in whose territory the pensioner or the children are residing:

(a)    to a pensioner who draws a pension under the legislation of one MemberState only, in accordance with the legislation of the Member Stateresponsible for the pension‘.

10.

    Point I.C (Germany) of Annex I is worded as follows:

'If the competent institution for granting family benefits in accordance withChapter 7 of Title III of the Regulation is a German institution, then within themeaning of Article 1(a)(ii) of the Regulation:

(a)    ”employed person” means any person compulsorily insured againstunemployment or any person who, as a result of such insurance, obtainscash benefits under sickness insurance or comparable benefits;

(b)    ”self-employed person” means any person pursuing self-employment whois bound:

    —    to join, or pay contributions in respect of, an old-age insurance withina scheme for self-employed persons, or

    —    to join a scheme within the framework of compulsory pensioninsurance.‘

German legislation

11.

    Paragraph 1(1)(1) of the Bundeskindergeldgesetz of 14 April 1964, as amended on21 January 1986 (Federal Law on Child Allowance, Bundesgesetzblatt I, p. 222;hereinafter 'the BKGG‘), provides that persons domiciled or ordinarily residentin Germany are to be entitled to allowances in respect of their dependent childrenand of persons treated as such by virtue of Paragraph 2(1).

12.

    Paragraph 2(5) of the BKGG states that children who are neither domiciled norordinarily resident in Germany are not to be taken into account for the purposesof calculating child allowance.

The main proceedings

13.

    Mr Kulzer is a German national residing in Germany who receives, as a retiredpolice officer, a pension from Freistaat Bayern. He is the father of Stefanie whowas born in 1974 and who from 1983 lived in France with her mother, a Frenchnational, from whom Mr Kulzer was divorced. After the death of her mother in1987, Stefanie continued to live in France with her French grandparents. She wentto school there and, during the school holidays, regularly visited her father, whocontinued to meet the costs of her education and subsistence. Mr Kulzer made adeclaration of second residence to the German authorities on behalf of hisdaughter. The French authorities never paid him any child allowance.

14.

    In October 1988 Mr Kulzer applied to Freistaat Bayern for child allowance inrespect of his daughter Stefanie under the BKGG. That application and hissubsequent objection were rejected on 27 July 1989 and 5 December 1989respectively.

15.

    After bringing an unsuccessful action against those decisions Mr Kulzer appealedto the Landessozialgericht (Higher Social Court), which upheld the judgment atfirst instance on the ground that his daughter was living in France. It held thatneither the declaration of second residence made by Mr Kulzer nor his daughter'sregular visits during the school holidays could be considered to satisfy the residencecondition laid down by the BKGG. Nor could Mr Kulzer rely on Article 73 of theRegulation because, being retired, he was neither an employed or self-employedperson within the meaning of Article 1 thereof nor a civil servant within themeaning of Article 2(3). Furthermore, Article 77(2) of the Regulation could notapply because payment of child allowance under the BKGG was not linked in anyway to receipt of a pension.

16.

    Mr Kulzer then appealed against that judgment to the Bundessozialgericht on apoint of law. Before that court he contends in particular that, as a retired civilservant, he is also entitled, by virtue of Article 73 of the Regulation, to childallowance paid under the BKGG.

17.

    In those circumstances the Bundessozialgericht decided to stay the proceedings andrefer the following two questions to the Court of Justice for a preliminary ruling:

'1.(a)    Does Regulation (EEC) No 1408/71, in particular Article 73 thereof, applyif the child in respect of whom family benefits are sought, but not theperson entitled to benefits himself or herself (in particular an employed orself-employed person), has exercised the right to freedom of movementwithin the European Community?

(b)    Is it relevant in that respect whether the other parent moved with the childto another Member State and pursued an activity there as an employed orself-employed person until his or her death?

2.    If Question 1 is answered in the affirmative, is a retired police officer a civilservant within the meaning of Article 2(3) of Regulation No 1408/71?‘

18.

    It is apparent from the order for reference that this case raises two questions, onerelating to Article 73 of the Regulation and the other to Article 77.

The question relating to Article 73 of the Regulation

19.

    First, the national court essentially asks whether Article 73 of the Regulation, readin conjunction with Point I.C of Annex I thereto, is to be interpreted, for thepurpose of the payment of child allowance under German legislation, as applyingto a national of that Member State who under its legislation receives an old-agebenefit as a retired civil servant, where that person has worked only in the MemberState of which he is a national and his dependent child has moved within theCommunity with his former spouse.

20.

    Subsidiarily, the national court asks the Court whether in such a case it is relevantthat the former spouse of the person concerned pursued, in the Member State towhich the former spouse moved, an activity as an employed or self-employedperson within the meaning of Article 1(a) of the Regulation.

21.

    In order to answer those questions it is necessary first to examine whether aperson, such as the plaintiff in the main proceedings, who is a retired civil servantand has worked only in the State of which he is a national, is covered by theRegulation where his dependent child has moved within the Community with hisformer spouse.

22.

    The persons covered by the Regulation are defined by Article 2, which forms partof Title I, entitled 'General provisions‘.

23.

    Under Article 2(1), the Regulation is to apply, inter alia, 'to employed or self-employed persons who are or have been subject to the legislation of one or moreMember States and who are nationals of one of the Member States‘.

24.

    The Court held in Case 182/78 Algemeen Ziekenfonds Drenthe-Plattenland v Pierik[1979] ECR 1977, at paragraph 4, that the term 'worker‘ was general in its scopeand covered any person, whether in gainful occupation or not, who qualified as aperson insured under the social security legislation of one or more Member States. It followed that, even if they were not in gainful occupation, pensioners entitled todraw pensions under the legislation of one or more Member States came within theprovisions of the Regulation concerning 'workers‘ by virtue of their insuranceunder a social security scheme, unless they were subject to special provisions.

25.

    Article 2(3) provides that the Regulation is also to apply to civil servants wherethey are or have been subject to the legislation of a Member State to which theRegulation applies. Under the scheme of the Treaty, civil servants are regardedas employed persons (see Case C-71/93 Van Poucke v Rijksinstituut voor de SocialeVerzekeringen der Zelfstandigen [1994] ECR I-1101, paragraph 17).

26.

    For the same reasons which led the Court to hold in Algemeen ZiekenfondsDrenthe-Plattenland v Pierik that the term 'worker‘ also covered retired workers,the term 'civil servant‘, which appears in a provision of general scope defining thepersons falling within the Regulation, must be construed as covering retired civilservants who no longer pursue a professional or trade activity where they are, orhave been, subject to the legislation of a Member State to which the Regulationapplies.

27.

    As regards the fact that the person to whom the national court's question refersnever himself moved within the Community, it should first be noted that the fourthrecital in the preamble to the Regulation in its original form states that 'theconsiderable differences existing between national legislations as regards thepersons to whom they apply make it preferable to establish the principle that theRegulation applies to all nationals of Member States insured under social securityschemes for employed persons‘.

28.

    Furthermore, according to Article 1(a) of the Regulation the terms 'employedperson‘ and 'self-employed person‘ refer to 'any person‘, without qualification,who is insured under one of the social security schemes referred to in that articlefor the contingencies and on the conditions mentioned in that provision (see, tothat effect, Case C-2/89 Bestuur van de Sociale Verzekeringsbank v Kits vanHeijningen [1990] ECR I-1755, paragraph 9). Likewise, under Article 2(1) and (3)the Regulation applies to employed or self-employed persons and to civil servantswho are or have been subject to the legislation of one Member State only.

29.

    Next, the Court held in Case 44/65 Hessische Knappschaft v Singer [1965] ECR 965,at pp. 970 and 971, that Article 52 of Regulation No 3 of the Council of 25September 1958 concerning social security for migrant workers (Journal Officiel1958, p. 561) applied to any person who was in receipt of benefit under thelegislation of a Member State and that the concept of 'worker‘ was thus notlimited solely to migrant workers stricto sensu or solely to workers required to movefor the purposes of their employment.

30.

    Finally, according to the fifth recital in the preamble to Regulation No 1408/71 inits original form, the provisions which the Regulation lays down for coordinationof national social security legislation also apply to circumstances where membersof the worker's family move within the Community.

31.

    It must accordingly be held that a person, such as the plaintiff in the mainproceedings, who is a retired civil servant and has worked only in the State of

which that person is a national, is covered by the Regulation where his dependentchild has moved within the Community with his former spouse, if that retiredperson is, or has been, subject to the legislation of a Member State to which theRegulation applies.

32.

    It is thus unnecessary to consider whether it is relevant that the former spouse ofthe plaintiff in the main proceedings pursued an activity as an employed or self-employed person after she moved within the Community.

33.

    The next question is therefore whether a person such as the plaintiff in the mainproceedings may rely on Article 73 of the Regulation in order to receive childallowance provided for by German law.

34.

    Although Article 73 does not expressly refer to civil servants, the situation of sucha person must in principle be treated in the same way as that of an employedperson to whom Article 1(a) of the Regulation applies since, as is apparent fromparagraph 25 of this judgment, civil servants are regarded, under the scheme of theTreaty, as employed persons.

35.

    The term 'employed person‘, which appears in Article 73 of the Regulation, isdefined in Article 1(a). However, that definition is displaced by the definition inPoint I.C of Annex I to the Regulation when the competent institution for grantingfamily benefits is, in accordance with Chapter 7 of Title III of the Regulation, aGerman institution.

36.

    It appears from the actual wording of that annex, to which Article 1(a)(ii) of theRegulation refers, that only workers compulsorily insured under one of the schemesmentioned therein are entitled to German family allowances in accordance withChapter 7 of Title III of the Regulation (Case C-266/95 Merino García vBundesanstalt für Arbeit [1997] ECR I-3279, paragraph 24).

37.

    Accordingly, to allow a retired civil servant, such as the plaintiff in the mainproceedings, to rely on Article 73 in order to receive German family allowances onthe ground that the situation of civil servants must generally be treated in the sameway as that of employed persons would involve disregarding the terms of Annex I.

38.

    In the light of the foregoing, the reply to the question relating to Article 73 of theRegulation must be that that provision, read in conjunction with Point I.C ofAnnex I to the Regulation, is to be interpreted, for the purpose of the payment ofchild allowance under German legislation, as not applying to a national of thatMember State who receives, under its legislation, an old-age benefit as a retiredcivil servant, where that person has worked only in the Member State of which heis a national and his dependent child has moved within the Community with hisformer spouse.

The question relating to Article 77 of the Regulation

39.

    In view of the circumstances in the main proceedings and in order to give thenational court as complete and useful an answer as possible, it is appropriate toconsider whether Article 77(2)(a) of the Regulation is to be interpreted as covering,as the Commission maintains, the situation of a person, such as the plaintiff in themain proceedings, who draws a pension under a special scheme for civil servantsand persons treated as such.

40.

    The Court held in Case 129/78 Sociale Verzekeringsbank Amsterdam v Lohmann[1979] ECR 853 that the term 'legislation‘ used in Article 77(2)(a) of theRegulation has the meaning stated in Article 1(j) thereof. That provision thereforedoes not cover the statutes, regulations or other provisions or measures relating tothe categories of benefits referred to in Article 4(4) of the Regulation whichinclude, in particular, special schemes for civil servants and persons treated as such.

41.

    That conclusion does not, however, preclude a person drawing a pension under aspecial scheme for civil servants and persons treated as such from relying onArticle 77(2)(a) of the Regulation if he also receives another old-age benefitcovered by that provision. However, the documents before the Court do notdisclose whether that is so in the case of the plaintiff in the main proceedings.

42.

    The answer to the question relating to Article 77(2)(a) of the Regulation musttherefore be that that provision is to be interpreted as not covering the situationof a person who draws a pension only under a special scheme for civil servants andpersons treated as such.

Costs

43.

    The costs incurred by the Commission of the European Communities, which hassubmitted observations to the Court, are not recoverable. Since these proceedingsare, for the parties to the main proceedings, a step in the action pending before thenational court, the decision on costs is a matter for that court.

On those grounds,

THE COURT (Fifth Chamber),

in answer to the questions referred to it by the Bundessozialgericht by order of30 April 1996, hereby rules:

1.    Article 73 of Council Regulation (EEC) No 1408/71 of 14 June 1971 on theapplication of social security schemes to employed persons, to self-employedpersons and to members of their families moving within the Community,

as amended and updated by Council Regulation (EEC) No 2001/83 of2 June 1983, as amended by Council Regulation (EEC) No 3427/89 of30 October 1989, then by Council Regulation (EEC) No 1247/92 of30 April 1992, read in conjunction with Point I.C of Annex I to the sameregulation, is to be interpreted, for the purpose of payment of childallowance under German legislation, as not applying to a national of thatMember State who receives, under its legislation, an old-age benefit as aretired civil servant, where that person has worked only in the MemberState of which he is a national and his dependent child has moved withinthe Community with his former spouse.

2.    Article 77(2)(a) of Regulation No 1408/71, as amended, is to be interpretedas not covering the situation of a person who draws a pension only undera special scheme for civil servants and persons treated as such.

GulmannMoitinho de Almeida Edward         Puissochet                            Jann

Delivered in open court in Luxembourg on 5 March 1998.

R. Grass

C. Gulmann

Registrar

President of the Fifth Chamber

1: Language of the case: German.