OPINION OF ADVOCATE GENERAL
MENGOZZI
delivered on 10 January 2013 (1)
Case C‑443/11
F.P. Jeltes
M.A. Peeters
J.G.J. Arnold
v
Raad van bestuur van het Uitvoeringsinstituut werknemersverzekeringen
(Request for a preliminary ruling from the Rechtbank Amsterdam (Netherlands))
(Social security for migrant workers – Article 45 TFEU – Regulation (EEC) No 1408/71 – Article 71 – Wholly unemployed atypical frontier worker – Entitlement to benefit in the Member State of residence – Refusal to pay by the State of last employment – Regulation (EC) No 883/2004 – Article 65 – Relevance of the judgment in Miethe – Transitional provisions – Article 87(8) – Concept of ‘unchanged situation’)
1. Pursuant to Council Regulation (EEC) No 1408/71 of 14 June 1971 on the application of social security schemes to employed persons and their families moving within the Community, (2) the Court had ruled that wholly unemployed atypical frontier workers were entitled to receive unemployment benefit either in their State of residence or in the State in which they were last employed. (3) The Court is now being asked whether this judicial solution must still be applied under Regulation (EC) No 883/2004 of the European Parliament and of the Council of 29 April 2004 on the coordination of social security systems. (4) It has also been asked to decide on the compatibility of a residence condition imposed by the State of last employment. Lastly, it will have to rule on the question of the transitional arrangements for unemployment benefit applicable to the relationship between Regulation No 1408/71 and Regulation No 883/2004.
I – Legal framework
A – European Union law
1. Regulation No 1408/71
2. Article 71 of Regulation No 1408/71 is the only article in Section 3 concerning unemployed persons who, during their last employment, were residing in a Member State other than the competent State. It reads as follows:
‘1. An unemployed person who was formerly employed and who, during his last employment, was residing in the territory of a Member State other than the competent State shall receive benefit in accordance with the following provisions:
(a) ...
(ii) A frontier worker who is wholly unemployed shall receive benefits in accordance with the provisions of the legislation of the Member State in whose territory he resides as though he had been subject to that legislation while last employed; these benefits shall be provided by the institution of the place of residence at its own expense;
(b)
(i) An employed person, other than a frontier worker, who is partially, intermittently or wholly unemployed and who remains available to his employer or to the employment services in the territory of the competent State shall receive benefits in accordance with the provisions of the legislation of that State as though he were residing in its territory; these benefits shall be provided by the competent institution;
(ii) An employed person, other than a frontier worker, who is wholly unemployed and who makes himself available for work to the employment services in the territory of the Member State in which he resides, or who returns to that territory, shall receive benefits in accordance with the legislation of that State as if he had last been employed there; the institution of the place of residence shall provide such benefits at its own expense. However, if such an employed person has become entitled to benefits at the expense of the competent institution of the Member State to whose legislation he was last subject, he shall receive benefits under the provisions of Article 69. Receipt of benefits under the legislation of the State in which he resides shall be suspended for any period during which the unemployed person may, under the provisions of Article 69, make a claim for benefits under the legislation to which he was last subject.
2. An unemployed person may not claim benefits under the legislation of the Member State in whose territory he resides while he is entitled to benefits under the provisions of paragraph 1(a)(i) or (b)(i).’
2. Regulation No 883/2004
3. Regulation No 883/2004 modernised and simplified the rules contained in Regulation No 1408/71. (5)
4. Recital 32 in the preamble to Regulation No 883/2004 states that ‘[i]n order to foster mobility of workers, it is particularly appropriate to facilitate the search for employment in the various Member States; it is therefore necessary to ensure closer and more effective coordination between the unemployment insurance schemes and the employment services of all the Member States’.
5. Article 1 of Regulation No 883/2004 defines frontier worker as ‘any person pursuing an activity as an employed or self-employed person in a Member State and who resides in another Member State to which he returns as a rule daily or at least once a week’.
6. Article 7 of Regulation No 883/2004 provides that ‘[u]nless otherwise provided for by this Regulation, cash benefits payable under the legislation of one or more Member States or under this Regulation shall not be subject to any reduction, amendment, suspension, withdrawal or confiscation on account of the fact that the beneficiary or the members of his/her family reside in a Member State other than that in which the institution responsible for providing benefits is situated’.
7. Article 63 of Regulation No 883/2004 provides that ‘[f]or the purposes of this Chapter, Article 7 shall apply only in the cases provided for by Articles 64 and 65 and within the limits prescribed therein’.
8. Paragraphs 1 to 6 of Article 65 of Regulation No 883/2004, which concerns the situation of unemployed persons who resided in a Member State other than the competent State, read as follows:
‘1. A person who is partially or intermittently unemployed and who, during his/her last activity as an employed or self-employed person, resided in a Member State other than the competent Member State shall make himself/herself available to his/her employer or to the employment services in the competent Member State. He/she shall receive benefit in accordance with the legislation of the competent Member State as if he/she were residing in that Member State. These benefits shall be provided by the institution of the competent Member State.
2. A wholly unemployed person who, during his/her last activity as an employed or self-employed person, resided in a Member State other than the competent Member State and who continues to reside in that Member State or returns to that Member State shall make himself/herself available to the employment services in the Member State of residence. Without prejudice to Article 64, a wholly unemployed person may, as a supplementary step, make himself/herself available to the employment services of the Member State in which he/she pursued his/her last activity as an employed or self-employed person.
An unemployed person, other than a frontier worker, who does not return to his/her Member State of residence, shall make himself/herself available to the employment services in the Member State to whose legislation he/she was last subject.
3. The unemployed person referred to in the first sentence of paragraph 2 shall register as a person seeking work with the competent employment services of the Member State in which he/she resides, shall be subject to the control procedure organised there and shall adhere to the conditions laid down under the legislation of that Member State. If he/she chooses also to register as a person seeking work in the Member State in which he/she pursued his/her last activity as an employed or self-employed person, he/she shall comply with the obligations applicable in that State.
...
5. (a) The unemployed person referred to in the first and second sentences of paragraph 2 shall receive benefits in accordance with the legislation of the Member State of residence as if he/she had been subject to that legislation during his/her last activity as an employed or self-employed person. Those benefits shall be provided by the institution of the place of residence.
(b) However, a worker other than a frontier worker who has been provided benefits at the expense of the competent institution of the Member State to whose legislation he/she was last subject shall firstly receive, on his/her return to the Member State of residence, benefits in accordance with Article 64, receipt of the benefits in accordance with (a) being suspended for the period during which he/she receives benefits under the legislation to which he/she was last subject.
6. The benefits provided by the institution of the place of residence under paragraph 5 shall continue to be at its own expense. However, subject to paragraph 7, the competent institution of the Member State to whose legislation he/she was last subject shall reimburse to the institution of the place of residence the full amount of the benefits provided by the latter institution during the first three months ...’.
9. Title VI of Regulation No 883/2004, containing Articles 87 to 91, lays down transitional and final provisions.
10. Article 87(8) of Regulation No 883/2004 as amended by Article 1(19) of Regulation (EC) No 988/2009 of the European Parliament and of the Council of 16 September 2009 (6) provides that, ‘[i]f, as a result of this Regulation, a person is subject to the legislation of a Member State other than that determined in accordance with Title II of Regulation (EEC) No 1408/71, that legislation shall continue to apply while the relevant situation remains unchanged and in any case for no longer than 10 years from the date of application of this Regulation unless the person concerned requests that he/she be subject to the legislation applicable under this Regulation. The request shall be submitted within 3 months after the date of application of this Regulation to the competent institution of the Member State whose legislation is applicable under this Regulation if the person concerned is to be subject to the legislation of that Member State as of the date of application of this Regulation. ...’.
11. Article 89 of Regulation No 883/2004, read in conjunction with Articles 90 and 91 of that regulation, provides that Regulation No 883/2004 begins to apply from the date of entry into force of the implementing regulation and that, from that date, Regulation No 1408/71 is repealed.
3. Regulation (EC) No 987/2009
12. Article 56(2) of Regulation (EC) No 987/2009 of the European Parliament and of the Council of 16 September 2009 laying down the procedure for implementing Regulation No 883/2004 (7) reads as follows:
‘Where the legislation applicable in the Member States concerned requires the fulfilment of certain obligations and/or job-seeking activities by the unemployed person, the obligations and/or job-seeking activities by the unemployed person in the Member State of residence shall have priority.
The non-fulfilment by the unemployed person of all the obligations and/or job‑seeking activities in the Member State in which he pursued his last activity shall not affect the benefit awarded in the Member State of residence.’
13. Article 97 of Regulation No 987/2009 provides that the regulation will enter into force on l May 2010.
4. Regulation (EEC) No 1612/68
14. Article 7(1) and (2) of Regulation (EEC) No 1612/68 of the Council of 15 October 1968 on freedom of movement for workers within the Community (8) reads as follows:
‘1. A worker who is a national of a Member State may not, in the territory of another Member State, be treated differently from national workers by reason of his nationality in respect of any conditions of employment and work, in particular as regards remuneration, dismissal, and, should he become unemployed, reinstatement or re-employment.
2. He shall enjoy the same social and tax advantages as national workers.’
B – Netherlands law
15. Under the Law of 6 November 1986 on the insurance of workers against the financial consequences of unemployment (Wet tot verzekering van werknemers tegen geldelijke gevolgen van werkloosheid; ‘the Law on unemployment’), workers who are neither residing nor staying, other than for holiday purposes, in the Netherlands are excluded from entitlement to benefit. (9) Entitlement to benefit ends as soon as the worker ceases to be unemployed or no longer satisfies the residence condition. (10) The Law on unemployment also provides that if entitlement to benefit ends and, subsequently, the circumstance which is the reason for the end of the entitlement ceases to exist, that entitlement to benefit is restored and is reactivated if a new entitlement to benefit has not arisen pursuant to the provisions of the Law on unemployment. (11)
II – The main proceedings and the questions referred for a preliminary ruling
16. Mr Jeltes, Mr Arnold and Ms Peeters, the applicants in the main proceedings, are all Netherlands nationals.
17. Mr Jeltes resides in Belgium. He was employed in the Netherlands until 30 July 2010, before experiencing a period of unemployment during which he submitted a claim, dated 2 August 2010, to the competent Netherlands body, the Raad van Bestuur van het Uitvoeringsinstituut werknemersverzekeringen (‘the UWV’), for payment of unemployment benefit on the basis of the Law on unemployment. The UWV refused to grant him that benefit on the ground that his claim had to be made in his State of residence, in accordance with Article 65 of Regulation No 883/2004.
18. Ms Peeters also resides in Belgium and also worked in the Netherlands. After becoming unemployed, she was awarded unemployment benefit as of 1 May 2009. On 26 April 2010, Ms Peeters returned to employment. The UWV then terminated her unemployment benefit, while informing Ms Peeters that if she were once again to become unemployed before 25 October 2010, she could make a claim for the payment of her unemployment benefit to be continued. Having been dismissed at the end of her probation period, on 18 May 2010 Ms Peeters submitted a claim to that effect. The UWV rejected that claim since, in its view, her unemployment situation had to be reexamined and, as the claim made by Ms Peeters postdated 1 May 2010, Article 65 of Regulation No 883/2004 had to be applied.
19. Mr Arnold resides in Germany and worked in the Netherlands before becoming unemployed and being awarded unemployment benefit paid by the UWV from 2 February 2009. In March 2009, Mr Arnold became self-employed. On 6 April 2009, the UWV terminated payment of the benefit, while informing Mr Arnold that if his self-employment ceased completely before 30 August 2011, he could make a claim for the payment of his unemployment benefit to be continued. On 1 June 2010, when he became unemployed again after ceasing his activity, Mr Arnold made a claim to that effect to the UWV, which rejected it on the ground that, in so far as the claim resulted from the cessation of activity after 1 May 2010, it now had to be made to the authorities of his State of residence and that the transitional provisions laid down in Regulation No 883/2004 were not applicable to Mr Arnold.
20. The three decisions by the UWV to refuse unemployment benefit are based on Article 65 of Regulation No 883/2004, which designates the State of residence as the competent State for the grant of the benefit to wholly unemployed frontier workers. The applicants in the main proceedings have challenged those decisions before the referring court.
21. Their action is essentially based on the reasoning that, since they are all atypical frontier workers, the UWV should have applied the solution adopted by the Court in Miethe and that there should still be a right to choose between the Member State of residence (Belgium or Germany) and the Member State of last employment (the Netherlands) in order to determine the Member State responsible for the grant of unemployment benefit pursuant to Regulation No 883/2004.
22. Thus, faced with a difficulty in interpreting European Union law, the Rechtbank Amsterdam (District Court, Amsterdam) decided to stay the proceedings and, by an order for reference which was received by the Registry of the Court of Justice on 29 August 2011, to refer the following questions to the Court for a preliminary ruling pursuant to Article 267 TFEU:
‘1. Is the supplementary scope of the judgment in Case 1/85 Miethe, which was delivered while Regulation No 1408/71 was in force, still valid under Regulation No 883/2004, that is to say, a right for an atypical frontier worker to choose the Member State in which he makes himself available to the employment recruitment services, and from which he receives unemployment benefit, on the ground that his prospects of reintegration into working life are greatest [in the Member State of his choice]? Or does Article 65 of Regulation No 883/2004, considered as a whole, provide sufficient guarantees that a wholly unemployed worker will receive a benefit under conditions which are most favourable for him in his search for work, and has the Miethe judgment lost its added value?
2. Does European Union law, in this case Article 45 TFEU or Article 7(2) of Regulation No 1612/68, preclude the refusal by a Member State to award unemployment benefit under its national legislation in the case of a migrant worker (frontier worker) who has become wholly unemployed, who was last employed in that Member State and who, given the existence of social and family ties, may be assumed to have the best prospects of reintegration into working life in that Member State, solely on the ground that he resides in another Member State?
3. Having regard to Article 87(8) of Regulation No 883/2004, Article 17 of the Charter of Fundamental Rights [of the European Union] and the principle of legal certainty, what would be the answer to the foregoing question if, before the date of the entry into force of Regulation No 883/2004, such a worker had been awarded an unemployment benefit under the legislation of the previous State of employment, where the maximum duration of the benefit and of the resumption had not yet lapsed at the time of that entry into force (and where that benefit was terminated on the ground that the unemployed person had again found work)?
4. Would the answer to the second question be different if undertakings had been given to the unemployed frontier workers concerned that they would be able to apply for the resumption of their entitlement to benefit if, after finding new work, they were once again to become unemployed, and the information supplied in that regard does not appear to have been correct or unambiguous as a result of lack of clarity in implementing practice?’
III – The procedure before the Court
23. Ms Peeters, the UWV, the Netherlands, Czech, Danish and German Governments and the European Commission submitted written observations to the Court.
24. At the hearing on 24 October 2012, oral argument was presented by the UWV, the Netherlands, Czech, Danish and German Governments and the Commission.
IV – Legal analysis
A – The first question
25. By its first question, the referring court asks the Court whether the judicial solution adopted in Miethe must still be applied under Regulation No 883/2004. Before an answer can be given, it is necessary to examine the judgment in that case more closely.
1. Miethe and its ratio decidendi
26. In Miethe, the referring court requested the interpretation of Article 71 of Regulation No 1408/71. That article, which specified which Member State was competent for payment of unemployment benefit, essentially made provision for two situations.
27. First of all, a wholly unemployed frontier worker was to receive benefit only from his State of residence ‘as though he had been subject to that legislation while last employed’. (12) Second, a wholly unemployed worker other than a frontier worker had to make himself available to the employment services of his State of residence which was required, in principle, to pay him unemployment benefit ‘as if he had last been employed there’, but that worker could also be accorded an entitlement to benefit in the Member State in which he was last employed. (13) In that case, the payment of benefit by the Member State of residence was suspended.
28. In Miethe, the question referred to the Court was whether a wholly unemployed frontier worker who has maintained particularly close personal and business links with the Member State in which he was last employed was to be regarded as coming within the scope of the first case (he was entitled to benefit only from the Member State of residence) or the second (he was entitled to benefit from the Member State of residence and the Member State of last employment).
29. To answer that question, the Court first pointed out that Article 71 of Regulation No 1408/71 was ‘intended to ensure that migrant workers receive unemployment benefit in the conditions most favourable to the search for new employment’, that benefit being ‘not merely pecuniary but includ[ing] the assistance in finding new employment which the employment services provide for workers who have made themselves available to them’. (14) The Court inferred that, in laying down the rule that a frontier worker was to be entitled to benefit from the State of residence, the Union legislature had thus assumed that ‘such a worker would find in that State the conditions most favourable to the search for new employment’. (15)
30. However, at the same time, the Court acknowledged that the objective pursued could not be achieved where a wholly unemployed frontier worker ‘has in exceptional circumstances maintained in the Member State in which he was last employed personal and business links of such a nature as to give him a better chance of finding new employment there’ (16) and that, in such a case, that worker therefore had to be regarded as a worker ‘other than a frontier worker’ falling within the scope of Article 71(1)(b)(ii) of Regulation No 1408/71. The Court concluded that it was for the referring court ‘to determine whether a worker who reside[d] in a Member State other than that in which he was last employed none the less continue[d] to enjoy a better chance of finding new employment in that State and … therefore [had to] come within the scope of Article 71(1)(b) of Regulation No 1408/71’. (17)
31. It is thus very clear from Miethe that the rationale for the solution adopted by the Court, almost running counter to the very wording of Article 71 of Regulation No 1408/71, was based solely on the wish to provide the worker concerned with the most favourable conditions for a return to employment. It should also be noted that the possibility, in that case, to turn to the Member State of last employment to claim payment of unemployment benefit there was available only to the category of ‘atypical frontier workers’ because of the particularly close personal and business links which they had maintained with the Member State in which they were last employed. The Court was probably permitted to depart from the letter of the regulation because it was actually based on a presumption – that the most favourable conditions for finding new employment are met in the Member State of residence – which should be regarded as rebuttable, at least in the exceptional cases referred to above. I would add, lastly, that the fact that, in Regulation No 1408/71, the State in which benefits are paid was necessarily the State in which the worker had to register in order to receive assistance from the employment services led the Court to take the view that, in the case of those atypical frontier workers, the objective of finding new employment would be achieved more easily if those workers could register with the employment services of the State in which they were last employed, which then made it necessary to establish that State’s competence for the payment of benefit.
2. The clear intention of the Union legislature to put an end to the Miethe exception
32. The question raised by the present case is therefore whether the ratio decidendi which I have just explained can justify maintaining the exception pursuant to Regulation No 883/2004.
33. It must first be stated that the European Union legislature did not opt to enshrine expressly the solution adopted by the Court in its judgment in Miethe, even though recital 21 in the preamble to Regulation No 883/2004 makes reference to the Court of Justice’s case-law, thus showing that the legislature was fully aware of the Court’s positions in this regard. Article 65 of Regulation No 883/2004 provides that a wholly unemployed frontier work receives benefit in the Member State of residence. With regard to payment of benefit, the legislature neither provided an option for the frontier worker nor laid down specific provisions governing the category of atypical frontier workers in accordance with Miethe.
34. Moreover, that provision has the completely opposite rationale to the one contained in the Commission’s initial proposal for a regulation. Under Article 51 of that proposal, a worker residing in a State other than the competent State who made himself available to the employment services of the State in which he resided was to receive the benefit provided by the competent State. (18) The legislature therefore very deliberately maintained the principle that the State of residence must provide unemployment benefit to frontier workers.
35. In fact, the innovation lies elsewhere. Article 65 decoupled the Member State which pays benefit from the Member State in which the worker may register with the employment services. More precisely, Article 65(2) of Regulation No 883/2004 provides that the frontier worker must ‘make himself available to the employment services in the Member State of residence’ and ‘may, as a supplementary step, make himself available to the employment services of the Member State in which he pursued his last activity as an employed or self‑employed person’.
36. Even though it could be claimed that the legislature, while not explicitly enshrine the solution adopted in Miethe, did not expressly reject it either, when drafting Article 65 of Regulation No 883/2004, that regulation must, in any event, be interpreted in the light of Regulation (EC) No 987/2009 of the European Parliament and of the Council, which constitutes its implementing regulation. According to recital 13 in the preamble to that implementing regulation, whereas ‘[f]rontier workers who have become wholly unemployed may make themselves available to the employment services in both their country of residence and the Member State where they were last employed … they should be entitled to benefit only from their Member State of residence’. (19)
37. It is particularly striking that this recital was introduced during the legislative procedure at the request of the European Parliament, which considered that after that clarification ‘there can no longer be any misunderstanding about whether the Miethe judgment is still to be applied or not’. (20) It is thus perfectly clear that the European Union legislature did not intend the solution adopted in Miethe to continue to be applicable under the aegis of Regulation No 883/2004.
38. That being the case, the Court could overcome that manifest absence of an intention on the part of the legislature if it could be convinced that the provisions of Regulation No 883/2004 are not capable of meeting the intended objective of guaranteeing the most favourable conditions for the frontier worker to find new employment.
39. Adhering strictly to the regulatory framework established by the basic regulation (Regulation No 883/2004) and clarified by the implementing regulation (Regulation No 987/2009), the situation is as follows: a frontier worker is entitled to benefit in the Member State of residence, he is required to register with the employment services in that State and may also, if he wishes, register with the employment services in the State in which he was last employed, it being understood that priority would nevertheless be given to compliance with the worker’s obligations in the State in which benefit is paid, i.e. in his State of residence.
40. Does such an arrangement guarantee frontier workers in general, and atypical frontier workers in particular – that is, those who have maintained close personal and business links with the Member State in which they were last employed – the most favourable conditions for a return to employment?
41. When questioned on that point at the hearing, the Commission’s representative was not able to show how the fact that an atypical frontier worker receives unemployment benefit paid by the State in which he was last employed was likely to guarantee the worker more favourable conditions for finding new employment when it is clear that the same worker may now register with the employment services in the State in which he was last employed.
42. I would add that, in her written observations, Ms Peeters claimed that the employment services in the State in which she was last employed would be less efficient, since they are less concerned with her finding new employment in so far as, specifically, the payment of benefit does not affect the budget of that State. That is merely a claim which, if proven, would in any case constitute discriminatory conduct contrary to EU law. However, the maintenance of the Miethe case-law cannot be justified solely because of that kind of fear.
43. Furthermore, the fact that, in the event of a conflict between obligations, priority must be given to the obligations to which the person seeking work is subject in the State of residence, necessarily stems from the fact that the State of residence is required to pay unemployment benefit. Nevertheless, I cannot share the view that it constitutes an obstacle to finding new employment in the State of last employment. I still believe that the possibility offered to the worker to register with the employment services of two Member States provides him with simultaneous access, in particular to job and training opportunities, on the labour market of two Member States, thereby increasing his prospects of returning to employment quickly.
44. In those circumstances and for the above reasons, I suggest that the Court answer the first question asked by the referring court to the effect that, under Article 65(5)(a) of Regulation No 883/2004, the only competent State for payment of unemployment benefit to frontier workers, including atypical frontier workers, who are wholly unemployed, is the State of residence.
B – The second question
45. The referring court asks the Court whether Article 7(2) of Regulation No 1612/68 and Article 45 TFEU preclude a refusal to pay unemployment benefit, such as that applied by the Netherlands authorities to the applicants in the main proceedings, solely on the ground that the applicants do not satisfy the condition of residence in the Netherlands laid down by national law in order to be able to claim payment of unemployment benefit.
46. According to settled case-law, ‘the fact that a national measure may be consistent with a provision of secondary legislation ... does not have the effect of removing that measure from the scope of the provisions of the Treaty’. (21) In addition, the Court has ruled that ‘Article 7(2) of Regulation No 1612/68 is the particular expression, in the specific area of the grant of social advantages, of the principle of equal treatment enshrined in Article 39(2) EC, and must be accorded the same interpretation as Article 39(2) EC’. (22)
47. Furthermore, the Court has already had to deal with situations similar to the one in the main proceedings. It is probably Petersen (23) which, although the judgment was delivered before the entry into force of Regulation No 883/2004, is closest to the present case. The Court was asked about the compatibility with Article 39 EC of an Austrian provision which made entitlement to a benefit regarded by the Court as an ‘unemployment benefit’ subject to the condition that the recipients be resident in the national territory of the State concerned, prohibiting the exportability of such a benefit to another Member State. In that case, the applicant in the main proceedings was a German national who, after working as an employed person in Austria, where he was domiciled, became unemployed again. He had then applied to the Austrian authorities for an advance on his unemployment benefit, which was refused because the applicant had, in the meantime, moved back to Germany.
48. However, a fundamental difference with the present case lies in the fact that, in Petersen, it was common ground that the Member State which had refused to pay the benefit in question was actually the competent Member State for payment of unemployment benefit under the coordination rules laid down in Regulation No 1408/71. The legal problem therefore raised was whether the State designated under Regulation No 1408/71 to pay unemployment benefit could, in accordance with primary law, make the payment of such benefit conditional on the applicant having his residence in its territory.
49. The analogy with Petersen thus stops there, as the applicants in the main proceedings in the present case clearly fall within the scope of Article 65 of Regulation No 883/2004, which replaced Article 71 of Regulation No 1408/71. Specifically under the rules laid down in Article 65, the State required to pay benefit to workers such as those in the main proceedings is the State of residence.
50. The question – which is quite different from that faced by the Court in Petersen – is thus whether the failure by the State of last employment to pay that benefit under the coordination rules laid down by the European Union legislature is contrary to the freedom of movement of those workers, it being understood that the applicants in the main proceedings are actually covered by the notion of ‘worker’ within the meaning of Article 45 TFEU. (24) According to the applicants in the main proceedings, who are ultimately calling into question the very essence of the coordination system laid down for frontier workers by Regulation No 883/2004 without ever going so far as to challenge its validity in the light of primary law, Dutch workers would be deterred from exercising their freedom of movement and establishing themselves in the territory of another Member State because, once status as a frontier worker has been acquired, the State in which unemployment benefit is paid becomes the State in which those workers are resident. Moreover, such a situation constitutes discrimination compared with Dutch workers working and residing in the Netherlands.
51. It is true that the Court has ruled that ‘[u]nless it is objectively justified and proportionate to the aim pursued, a provision of national law must be regarded as indirectly discriminatory if it is intrinsically liable to affect migrant workers more than national workers and if there is a consequent risk that it will place the former at a particular disadvantage’. (25) It added that ‘[t]hat is true of a residence condition such as the one to which the grant of the benefit at issue in the main proceedings is subject, which can be more easily met by national workers than by those from other Member States, since the latter workers above all, particularly in the case of unemployment ... , tend to leave the country in which they were formerly employed to return to their countries of origin’. (26)
52. However, in the case in the main proceedings the workers concerned have already exercised their freedom of movement, have already left national territory and do not intend to return there.
53. In order to ascertain whether there is an obstacle or a deterrent to the exercise of freedom of movement, it is first necessary to determine an effect on the situation of frontier workers such as those in the main proceedings. However, I admit to having some difficulty in imagining this.
54. First of all, it is settled case-law that a worker may not claim that his move will be neutral as regards social security. That is an inevitable consequence of the fact that Article 48 TFEU (27) confers on the European Union a power only to coordinate, and not to harmonise, the laws of the Member States in the field of social security. Thus, ‘substantive and procedural differences between the social security systems of individual Member States and hence in the rights of persons who are insured persons there, are unaffected’ (28) by Article 48 TFEU.
55. Second, the applicants in the main proceedings have not actually proved that they suffered from being paid unemployment benefit by their Member State of residence. I would point out in that regard that it is very difficult to determine which national system would be more advantageous.
56. First, although it is apparent from the documents before the Court, for example, that the amount of the benefit would be higher in the Netherlands, the term of payment would be longer in Belgium.
57. Second, EU law has not established a coordination principle to guarantee on a systematic basis that the highest amounts of benefit are received. At best it must be ensured that social security contributions are not paid without return. (29) It is true that the Court has ruled that the objective of freedom of movement of workers would not be attained ‘if, as a consequence of the exercise of their right to freedom of movement, workers were to lose the social security advantages guaranteed them by the legislation of one Member State, especially where those advantages represent the counterpart of contributions which they have paid’. (30) It must nevertheless be stated that the applicants in the main proceedings have not lost ‘a social security advantage’. Quite simply, the entitlement to benefit arising by virtue of periods worked in the Netherlands is transferred to the State of residence and can be resumed at any time in the State of last employment if those applicants should re-establish themselves there. It should also be borne in mind that the applicants in the main proceedings may, if they wish, utilise the employment services of the State in which they were last employed. Furthermore, in view of the specific nature of those contributions and of social security systems in general, a strictly accounting logic cannot be applied. (31) I also wish to point out that the non-correspondence between the Member State which collected the contributions and the State in which benefit is paid is a consequence accepted by the Member States by virtue of the choice they have made in favour of frontier workers, which is based on a certain degree of solidarity. (32)
58. Third, as the German Government rightly pointed out in its written observations, the amount of unemployment benefit is generally set by the Member States, clearly on an individual basis, with reference to the cost of living in each State. Consequently, the fact that the amount of the Dutch unemployment benefit is highest can be explained by a higher cost of living in that Member State, to which the applicants in the main proceedings are not exposed as they live and reside either in Belgium or in Germany. That fundamental factor distinguishes them from those who work and reside in the Netherlands. Consequently, there are different situations which may be treated differently. (33)
59. The treatment of frontier workers is aligned with that of residents of the country in which they are established. That is clearly the result of a choice made by the European Union legislature which, in doing so, implemented the principle of non-discrimination. Equal treatment of frontier workers is thus guaranteed in the State of residence, Article 65 of Regulation No 883/2004 providing that the State of residence must pay unemployment benefit ‘as though’ the workers had been subject to their own legislation while last employed.
60. Lastly, it is crucial to the present case to consider that, as I have already said, the refusal by the Netherlands authorities does not deprive the workers of unemployment benefit, but, on the contrary, directs them to their State of residence for the payment of such benefit. Such direction follows from the application of a coordination rule adopted by the European Union legislature which seeks to promote freedom of movement for workers and is based on the idea that it would be in the interest of those workers to receive that benefit in and from their State of residence.
61. It should nevertheless be stated that it is perfectly clear – even though it is not the subject-matter of the present reference for a preliminary ruling – that the residence clause contained in the Netherlands legislation cannot be applied in cases covered, in particular, by Article 65(1) of Regulation No 883/2004 (case of a worker who is partially unemployed and who resides in a State other than the State in which he was last employed) or by Article 65(5)(b) of that regulation (case of a non-frontier worker who, after starting to receive unemployment benefit in the State in which he was last employed, transfers his residence to another State). (34)
62. Since the applicants’ situation is covered by Article 65(5)(a) of Regulation No 883/2004, and for the reasons described above, inter alia in point 52 of this Opinion, in my opinion, in circumstances such as those in the main proceedings, the refusal by the State of last employment to pay unemployment benefit to frontier workers who have their residence in another Member State does not infringe the freedom of movement for workers, where the entitlement to benefit is transferred to the State of residence.
C – The third and fourth questions
63. By its third and fourth questions to the Court, the referring court asks whether Article 87(8) of Regulation No 883/2004, Article 17 of the Charter of Fundamental Rights of the European Union, the principle of legal certainty and/or the principle of the protection of legitimate expectations could require the Netherlands authorities to continue payment of unemployment benefit to the applicants in the main proceedings.
64. It should first be stated that these questions relate to only two of the applicants. The Netherlands authorities started to pay unemployment benefit to Ms Peeters and to Mr Arnold before the entry into force of Regulation No 883/2004, thus applying the Miethe case-law. When those two workers returned to employment, the authorities informed them that their entitlement to benefit could be continued in the Netherlands if they were once again to become unemployed before a date set by the authorities and after 1 May 2010, the date of entry into force of Regulation No 883/2004.
65. The Court is thus being asked, first and foremost, to ascertain whether specific transitional arrangements are capable of applying to frontier workers in a situation such as that I have just described. To do so, it is necessary to conduct an in-depth examination of the transitional arrangements for Regulation No 883/2004.
1. The applicability of Article 87(8) of Regulation No 883/2004 to unemployment benefit
66. It follows from Article 87(8) of Regulation No 883/2004 that, in principle, ‘if, as a result of this Regulation, a person is subject to the legislation of a Member State other than the one determined in accordance with Title II of Regulation [No 1408/71], that legislation shall continue to apply as long as the relevant situation remains unchanged’. The coordination rules for unemployment benefit were laid down, under the earlier regulation, by Title III on ‘special provisions relating to the various categories of benefit’.
67. The legislation applicable to Ms Peeters and to Mr Arnold remains unchanged as a result of the application of the rules of Regulation No 883/2004. (35) It is clear from the wording of Article 87(8) that it does not cover, a priori, situations such as those submitted to the Court for examination. The only transitional provision specifically dedicated to unemployment benefit is Article 87(10) of Regulation No 883/2004, which simply fixes the scope ratione temporis of Article 65(2) and (3) of that regulation in Luxembourg. It does not therefore cast any further light on the situation.
68. In my view, there is a reason for this lacuna. In the initial proposal for a regulation, the Commission proposed establishing the principle that wholly unemployed frontier workers would receive benefit in the State in which they were last employed. As that principle represented a change compared with Regulation No 1408/71, the Commission proposed the adoption of transitional measures. (36) As we know, the Council of the European Union did not follow the Commission’s proposal and the principle ultimately established is that the State of residence pays unemployment benefit. The legislature must have considered it unnecessary to include transitional provisions in that regard, since the principle remained unchanged. However, that was to forget the case of workers classified, under Regulation No 1408/71, as atypical frontier workers.
69. For those reasons, it would seem that an analogous application of Article 87(8) of Regulation No 883/2004 must be considered, in view of the fact that the legislature did not lay down other provisions for the transition, in compliance with acquired entitlements, between the old regulation and the new regulation, which puts an end to the special treatment accorded until then to atypical frontier workers with regard to unemployment benefit. Such a solution would have the advantage of giving a dynamic interpretation to that regulation without, however, running counter to the legislature’s intention to put an end to the Miethe exception.
70. It is difficult to envisage that, for all frontier workers classified as atypical under Regulation No 1408/71 and in receipt of benefit paid by the State in which they were last employed, that payment ceased immediately on 1 May 2010, without advance notice.
71. The legislature has – in my view inadvertently – left a legal vacuum, both in the basic regulation and in the implementing regulation, which has in some cases been filled by the Member States themselves. At the hearing, the Netherlands Government, in particular, confirmed that it applied to unemployment benefit the transitional provision contained in Article 87(8) of Regulation No 883/2004, precisely so as not to confront the workers concerned with an immediate and sudden change for which they were unprepared. (37) Thus, such analogous application would not cause conflict with the Member States either.
2. The notion of ‘unchanged situation’
72. Once the possibility of applying Article 87(8) of Regulation No 883/2004 to unemployment benefit has been accepted, it must still be determined whether the situation of the two applicants concerned in the main proceedings satisfies the conditions laid down by the European Union legislature. That article must be interpreted as meaning that atypical frontier workers who, under Regulation No 1408/71, received unemployment benefit paid by the State in which they were last employed, may continue to receive it ‘while the relevant situation remains unchanged’.
73. What can be the reasons for a change?
74. It is clear that, a priori, new employment can constitute a change of situation for the purposes of Article 87(8) of Regulation No 883/2004, particularly in respect of unemployment benefit. (38) However, it is not necessarily synonymous with the extinction of entitlement to benefit.
75. Because the European Union does not have the necessary competence to harmonise the conditions in which entitlement to unemployment benefit arises, is maintained or ends, it is necessary to refer to national law. Nevertheless, the Member States must lay down those conditions in compliance with European Union law.
76. The referring court must therefore determine whether, under national law, the resumption of a temporary activity undertaken by Ms Peeters and Mr Arnold constitutes a sufficient ground to end payment of benefit or whether it constitutes only a short-lived interruption, it being possible for payment to resume where unemployment recurs after a short period.
77. The documents before the Court do not contain sufficient information on national law to enable it to formulate an opinion and it is in any event for the referring court to give the final assessment. Nevertheless, I wish to highlight the fact that the statements made by the Netherlands authorities unequivocally show that they viewed the applicants’ situation as one continuous unit of time, with the result that new employment is not a sufficient reason to interrupt permanently the payment of unemployment benefit, which is the realisation of the entitlements acquired by virtue of the period worked before the entry into force of Regulation No 883/2004. It is clear from the order for reference that the UWV informed the applicants that, if they were once again to become unemployed before the prescribed date – after the entry into force of Regulation No 883/2004 – they could claim the ‘continuation’ or the ‘resumption’ of payment of the benefit in question.
78. In order to assess whether there has been a change of situation, that is to say, whether an event has occurred which is liable to cause loss of entitlement to unemployment benefit acquired by virtue of periods worked prior to the entry into force of Regulation No 883/2004, the national court will also have to take into consideration the length of the period during which the workers concerned actually resumed employment. Particular attention will have to be paid in that regard to the situation of Ms Peeters. The UWV has claimed inter alia that her resumption of employment between 26 April 2010 and 18 May 2010 constituted a change in her situation justifying the referral of the applicant to the Belgian authorities. However, it is perfectly clear that that very short period worked – barely three weeks – did not create a new entitlement to benefit for Ms Peeters.
79. Thus, without it being necessary to reflect further on a possible infringement of the right to property and the principles of legal certainty and the protection of legitimate expectations, I suggest that the Court answer that Article 87(8) of Regulation No 883/2004 must be interpreted to the effect that it also applies, on a transitional basis, to cases in which, under Title III of Regulation No 1408/71, wholly unemployed atypical frontier workers received unemployment benefit in the State in which they were last employed, whereas Regulation No 883/2004 now designates solely the State of residence for payment of such benefit. The referring court must determine whether, in circumstances such as those in the main proceedings, the resumption of employment has the effect of ending the relevant entitlement acquired by virtue of periods worked prior to the entry into force of Regulation No 883/2004.
V – Conclusion
80. In the light of the foregoing, I suggest that the Court answer the questions asked by the Rechtbank Amsterdam as follows:
(1) Under Article 65(5)(a) of Regulation (EC) No 883/2004 of the European Parliament and of the Council of 29 April 2004 on the coordination of social security systems, the only competent State for payment of unemployment benefit to frontier workers, including atypical frontier workers, who are wholly unemployed, is the State of residence.
(2) Since the situation of the applicants is covered by Article 65(5)(a) of Regulation No 883/2004, the refusal by the State of last employment to pay unemployment benefit to frontier workers who have their residence in another Member State does not, in circumstances such as those in the main proceedings, infringe the freedom of movement for workers, where the entitlement to the benefit is transferred to the State of residence.
(3) Article 87(8) of Regulation No 883/2004 must be interpreted to the effect that it also applies, on a transitional basis, to cases in which, under Title III of Regulation No 1408/71, wholly unemployed atypical frontier workers received unemployment benefit in the State in which they were last employed, whereas Regulation No 883/2004 now designates solely the State of residence for payment of such benefit. The referring court must determine whether, in circumstances such as those in the main proceedings, the resumption of employment has the effect of ending the relevant entitlement acquired by virtue of periods worked prior to the entry into force of Regulation No 883/2004.