JUDGMENT OF THE COURT

21 September 1999 (1)

(Compulsory affiliation to a sectoral pension scheme —

Compatibility with competition rules — Classification

of a sectoral pension fund as an undertaking)

In Case C-219/97,

REFERENCE to the Court under Article 177 of the EC Treaty (now Article 234EC) by the Hoge Raad der Nederlanden, Netherlands, for a preliminary ruling inthe proceedings pending before that court between

Maatschappij Drijvende Bokken BV

and

Stichting Pensioenfonds voor de Vervoer- en Havenbedrijven

on the interpretation of Articles 85, 86 and 90 of the EC Treaty (now Articles 81EC, 82 EC and 86 EC),

THE COURT,

composed of: G.C. Rodríguez Iglesias, President, J.-P. Puissochet, G. Hirsch andP. Jann (Presidents of Chambers), J.C. Moitinho de Almeida (Rapporteur),

C. Gulmann, J.L. Murray, D.A.O. Edward, H. Ragnemalm, L. Sevón andM. Wathelet, Judges,

Advocate General: F.G. Jacobs,

Registrar: D. Louterman-Hubeau, Principal Administrator,

after considering the written observations submitted on behalf of:

—    Maatschappij Drijvende Bokken BV, by T.R. Ottervanger, of the RotterdamBar,

—    Stichting Pensioenfonds voor de Vervoer- en Havenbedrijven, by E. Lutjens,of the Amsterdam Bar, and O. Meulenbelt, of the Utrecht Bar,

—    the Netherlands Government, by A. Bos, Legal Adviser in the Ministry ofForeign Affairs, acting as Agent,

—    the German Government, by E. Röder, Ministerialrat at the FederalMinistry of the Economy, and C.-D. Quassowski, Regierungsdirektor at thesame Ministry, acting as Agents,

—    the French Government, by K. Rispal-Bellanger, Head of the Subdirectoratefor International Economic Law and Community Law in the Legal AffairsDirectorate of the Ministry of Foreign Affairs, and C. Chavance, ForeignAffairs Secretary in that Directorate, acting as Agents,

—    the Swedish Government, by L. Nordling, Rättschef in the Foreign TradeDepartment of the Ministry of Foreign Affairs, acting as Agent,

—    the Commission of the European Communities, by B.J. Drijber and W. Wils,of its Legal Service, acting as Agents,

having regard to the Report for the Hearing,

after hearing the oral observations of Maatschappij Drijvende Bokken BV,represented by T.R. Ottervanger; Stichting Pensioenfonds voor de Vervoer- enHavenbedrijven, represented by E. Lutjens and O. Meulenbelt; the NetherlandsGovernment, represented by M.A. Fierstra, Head of the European LawDepartment in the Ministry of Foreign Affairs, acting as Agent; the FrenchGovernment, represented by C. Chavance; the Swedish Government, representedby A. Kruse, Departementsråd in the Legal Secretariat (EU) of the Ministry ofForeign Affairs, acting as Agent, and the Commission, represented by W. Wils, atthe hearing on 17 November 1998,

after hearing the Opinion of the Advocate General at the sitting on 28 January1999,

gives the following

Judgment

1.

    By judgment of 6 June 1997, received at the Court on 12 June 1997, the HogeRaad der Nederlanden (Supreme Court of the Netherlands) referred to the Courtof Justice for a preliminary ruling under Article 177 of the EC Treaty (now Article234 EC) six questions on the interpretation of Articles 85, 86 and 90 of the ECTreaty (now Articles 81 EC, 82 EC and 86 EC).

2.

    Those questions were raised in proceedings brought by Maatschappij DrijvendeBokken BV (hereinafter 'Drijvende Bokken‘) against Stichting Pensioenfonds voorde Vervoer- en Havenbedrijven (Transport and Dock Industry Pension Fund,hereinafter 'the Fund‘) concerning Drijvende Bokken's refusal to pay into theFund the contributions for the years 1991 to 1993 on the ground that compulsorymembership of the Fund by virtue of which such contributions are claimed from itis contrary to Articles 85, 86 and 90 of the Treaty.

The national legislation

3.

    The pension system in the Netherlands is based on three pillars.

4.

    The first is a statutory basic pension, granted by the State under the AlgemeneOuderdomswet (General law on old age pensions, 'the AOW‘) and the AlgemeneNabestaandenwet (General law on survivors' benefits). That compulsory legalscheme entitles the whole population to receive a pension of a limited amount,regardless of the wage which they actually received previously, calculated byreference to of the statutory minimum wage.

5.

    The second pillar comprises supplementary pensions provided in the context ofemployment or self-employed activity, which are in most cases additional to thebasic pension. Such supplementary pensions are normally managed within theframework of collective schemes covering a sector of the economy, a profession orthe employees of an undertaking by funds to which affiliation has been madecompulsory, as in the main proceedings, by the Wet van 17 maart 1949 houdendevaststelling van en regeling betreffende verplichte deelneming in eenbedrijfspensioenfonds (Law of 17 March 1949 laying down rules for compulsoryaffiliation to a sectoral pension fund, hereinafter the 'BPW‘).

6.

    The third pillar comprises individual pension insurance or life assurance policieswhich can be concluded on a voluntary basis.

7.

    The Wet op de Loonbelasting (Wages Tax Law) provides that premiums used tobuild up a pension are deductible only if the pension does not exceed a'reasonable‘ level. Premiums are not deductible in the case of a pensionexceeding that level. That level is, for a 40-year career, 70% of an individual's finalsalary. The effect of this tax regime is that the current standard in the Netherlandsfor establishing a pension, including the State pension under the AOW, is a pensioncorresponding to 70% of an employee's final salary.

8.

    Article 1(1) of the BPW, as amended by the Law of 11 February 1988, provides:

'The following terms shall, for the purposes of this Law and of provisions basedon it, have the following meanings:

...

(b)    sectoral pension fund: a fund operating in a sector of activity for thepurposes of which funds are collected either solely for the benefit ofemployees in the sector concerned or also for the benefit of personsengaged in an activity in another capacity in the said sector.

...

(f)    our Minister: the Minister for Social Affairs and Employment.‘

9.

    Article 3 of the BPW, as amended, provides:

'1. Our Minister may, at the request of a sectoral trade organisation which heregards as sufficiently representative of the business structure of a sector of activity,after consulting the head of the appropriate general administrative departmentwhose area of responsibility includes the activities of the sector concerned, theSociaal-Economische Raad (Social and Economic Council) and theVerzekeringskamer (Insurance Board), make affiliation to the sectoral pension fundcompulsory for all workers or for certain categories of worker in the sector ofactivity concerned.

2. In the circumstances mentioned in the foregoing paragraph, all persons withinthe categories concerned by virtue of the provisions of that paragraph, and also, inthe case of employees, their employers, shall be required to comply with thestatutes and regulations of the sectoral pension fund and any provisions applicableto them by virtue thereof. Compliance therewith may be enforced by legalproceedings, in particular with regard to the payment of contributions.‘

10.

    Article 5(2) of the BPW, as amended, lays down certain conditions to be fulfilledbefore the Minister for Social Affairs and Employment can approve a request forcompulsory affiliation as provided for in Article 3(1). Thus, under Article 5(2)(III)and (IV) of the BPW, as amended, the statutes and regulations of the sectoral

pension fund must adequately safeguard the interests of the members, and therepresentatives of the associations of employers and workers in the sectorconcerned must sit in equal numbers on the management board of the fund.

11.

    Article 5(2)(II)(1) of the BPW, as amended, also provides that the statutes andregulations of the sectoral pension fund must provide for cases in which, and theconditions under which, workers in the sector concerned are not required to beaffiliated to the fund or may be exempted from certain obligations relating to thefund.

12.

    Article 5(3) of the BPW, as amended, states:

'Our Minister for Social Affairs and Employment, after hearing the views of theInsurance Board and the Social and Economic Council, shall adopt guidelinesconcerning the matters referred to in Article 5(2)(II)(1). Those guidelines shouldobserve the principle that workers who were already affiliated to a pension fundof an undertaking or were insured with a life assurance company six months beforethe request referred to in Article 3(1) was lodged, shall not be required to beaffiliated to that sectoral pension fund or shall be exempted, entirely or to areasonable extent, from the obligation to contribute to it, provided that they candemonstrate that, in the course of the period for which they are under noobligation to be affiliated or are exempted from the obligation to pay contributions,in their entirety or as regards a reasonable proportion thereof, they will acquirepension rights which are at least equivalent to those which they would acquire ifaffiliated to the sectoral pension fund and for so long as they can so demonstrate. Our Minister may also adopt guidelines relating to other parts of paragraph 2.‘

13.

    By the Beschikking van 29 december 1952 betreffende de vaststelling van derichtlijnen voor de vrijstelling van deelneming in een bedrijfspensioenfonds wegenseen bijzondere pensioenvoorziening (Order of 29 December 1952 relating to theadoption of guidelines for the exemption from participation in a sectoral pensionfund in case of special pension arrangements, as amended by the decision of 15August 1988, hereinafter 'the Guidelines for exemption from affiliation‘) theMinister for Social Affairs and Employment adopted the guidelines referred to inArticle 5(3) of the BPW, as amended.

14.

    Article 1 of the Guidelines for exemption from affiliation, as amended, provides:

'An exemption from the obligation to be affiliated to a sectoral pension fund orfrom the obligation to pay contributions thereto may be granted by that fund at therequest of any interested party, provided that the worker in the sector concernedis covered by special pension arrangements meeting the following conditions:

(a) the arrangements must be applied under the auspices of a company pensionfund, another sectoral fund or an insurer holding a certificate of the kind provided

for by Article 10 of the Wet toezicht verzekeringsbedrijf (Law on supervision of theinsurance industry, Staatsblad 1986, p. 638) or be based on the Algemeneburgerlijke pensioenwet (General law on civil service pensions, Staatsblad 1986, p.540), the Spoorwegenpensioenwet (Law on pensions for employees of theNetherlands Railways and their relatives, Staatsblad 1986, p. 541) or the Algemenemilitaire pensioenwet (General law on military pensions, Staatsblad 1979, p. 305);

(b) such rights as may arise under those arrangements must, in the aggregate, beat least equivalent to those accruing under the sectoral pension fund;

(c) the rights of the worker concerned and compliance with his obligations must beadequately safeguarded;

(d) if the exemption entails withdrawal from the fund, compensation consideredreasonable by the Insurance Board must be offered for any loss suffered by thefund, from the actuarial point of view, as a result of the withdrawal.‘

15.

    Article 5 of the Guidelines, as amended, provides:

'1. The exemption must be granted where the conditions mentioned in Article 1(a),(b) and (c) are fulfilled, the special pension arrangements applied six monthsbefore submission of the request on the basis of which affiliation to the sectoralpension fund was made compulsory and it has been shown that, in the course ofthe period for which the worker concerned is under no obligation to be affiliatedor is exempted from the obligation to pay contributions in their entirety or asregards a reasonable proportion thereof, he will acquire pension rights which areat least equivalent to those which he would acquire if affiliated to the sectoralpension fund.

2. If, at the time referred to in paragraph 1, the special pension arrangements didnot meet the condition laid down in Article 1(b), a sufficient period must beallowed to elapse to enable that condition to be met before any decision is takenon the request.

3. An exemption under this article shall enter into force when affiliation to thesectoral pension fund is made compulsory.‘

16.

    Article 9 of the Guidelines, as amended, states:

'1. The decisions referred to in Article 8 may be the subject of complaints to theInsurance Board lodged within 30 days of receipt of the decision by the personconcerned. The sectoral pension fund must, in writing, bring the foregoingsentence to the notice of the person concerned at the same time as the decision.

2. The Insurance Board shall notify its decision on the complaints to the sectoralpension fund and to the persons who lodged them.‘

17.

    The appraisal made by the Insurance Board constitutes a proposal for conciliation. It is not a decision with binding force in the context of a dispute. The appraisal bythe Insurance Board cannot be the subject of any complaint or appeal.

18.

    Sectoral pension funds to which affiliation has been made compulsory are subjectnot only to the BPW but also to the Wet van 15 mei 1962 houdende regelenbetreffende pensioen- en spaarvoorzieningen (Law of 15 May 1962 on pension andsavings funds, amended subsequently a number of times — hereinafter 'the PSW‘).

19.

    The PSW is intended to ensure as far as possible that pension commitments givento workers are actually fulfilled.

20.

    To that end, Article 2(1) of the PSW obliges employers to choose one of three setsof arrangements aimed at separating the funds collected for pension purposes fromthe remainder of the company's assets. The employer may either join a sectoralpension fund, set up a company pension fund, or arrange group or individual lifeassurance policies with an insurance company.

21.

    Article 1(6) of the PSW makes clear that it also applies to sectoral pension fundsto which affiliation has been made compulsory under the BPW.

22.

    The PSW also lays down a number of conditions which must be met by the statutesand regulations of a sectoral pension fund. Thus, Article 4 of the PSW providesthat the setting up of any such fund must be notified to the Minister for SocialAffairs and Employment and to the Insurance Board. Article 6(1) of the PSWconfirms that representatives of the employers' organisations and representativesof the workers' organisations of the sector concerned are to sit in equal numberson the management board of a sectoral pension fund.

23.

    In addition, Articles 9 and 10 of the PSW lay down detailed arrangements formanagement of the funds collected. The general rule is set out in Article 9 whichobliges pension funds to transfer the risk linked to their pension commitments orto reinsure it. By way of exception to that rule Article 10 allows pension funds toadminister and invest the capital collected themselves at their own risk. Before itcan be authorised to do so, a pension fund must submit to the competentauthorities a management plan explaining in detail the way it proposes to handlethe actuarial and financial risks. The plan must be approved by the InsuranceBoard. Furthermore the pension fund is subject to continuous supervision. Thescheme's actuarial profit and loss accounts must be submitted regularly to theInsurance Board for approval.

24.

    Finally, Articles 13 to 16 of the PSW lay down rules for investment of the sumscollected. By virtue of Article 13, the assets of the scheme together with expectedincome must be sufficient to cover pension liabilities. Under Article 14 investmentsmust be made prudentially.

The main proceedings

25.

    The Fund was established under the BPW. By an order of 9 September 1959(hereinafter 'the order making affiliation compulsory‘), the Minister for SocialAffairs and Employment made affiliation to the Fund compulsory for maleemployees of 18 years of age or more habitually employed in dock undertakings inand around the Rotterdam port area. By an order of 17 December 1991, the scopeof the order making affiliation compulsory was extended to workers habituallyemployed in any dock undertaking or business treated as such.

26.

    The pension scheme offered by the Fund is based on the present norm in theNetherlands, namely that every worker who has paid contributions for themaximum period of affiliation to that scheme receives a pension, including theState pension under the AOW, equal to 70% of his final salary.

27.

    Drijvende Bokken hires out floating derricks, which are operated by its ownemployees. The derricks, which are often hired out with tugs, are used in particularin the offshore industry and the chemical industry for construction and buildingactivities.

28.

    Taking the view that it was not covered by the order making affiliation compulsory,Drijvende Bokken concluded arrangements with another pension fund. Followingthe extension of compulsory affiliation in 1991, on 20 October 1993 the Fundserved on Drijvende Bokken a demand for payment of the capital sum of NLG132 000 in respect of contributions for the years 1991 to 1993. Drijvende Bokkenappealed against that demand to the Kantongerecht (Cantonal Court), Rotterdam.

29.

    By judgment of 2 May 1994, the Kantongerecht upheld the appeal on the groundthat Drijvende Bokken's employees were not employed in a dock business withinthe meaning of the order making affiliation compulsory. The Fund appealedagainst that judgment to the Arrondissementsrechtbank (District Court),Rotterdam.

30.

    By judgment of 25 January 1996 that court amended the Kantongerecht's judgmenton the basis that Drijvende Bokken's employees were employed principally in adock business or a business treated as such and were therefore covered by theorder making affiliation compulsory. The Arrondissementsrechtbank also rejectedDrijvende Bokken's alternative contention that compulsory affiliation to the Fundwas incompatible with Article 3(g) of the EC Treaty (now, after amendment,Article 3(1)(g) EC), Article 5 of the EC Treaty (now Article 10 EC), and Articles85, 86 and 90 of the Treaty, taking the view that the Fund could not be regardedas an undertaking within the meaning of Articles 85 and 86 of the Treaty and wasmore in the nature of a social security organisation.

31.

    Drijvende Bokken appealed in cassation to the Hoge Raad (Supreme Court),contending that the Arrondissementsrechtbank had erred in considering compulsorymembership of the Fund to be compatible with Community law.

32.

    The Hoge Raad found that that argument necessarily raised certain questionsconcerning the interpretation of Articles 85, 86 and 90 of the Treaty. It referredin particular to Case 267/86 Van Eycke [1988] ECR 4769, paragraph 16. On theother hand, the Hoge Raad considered that in the present case there was norestriction of the freedom to provide services or of the right of establishment.

33.

    In its order for reference, the Hoge Raad set out a number of undisputed facts. The Fund was non-profit-making and non-commercial. It operated a pension fundfor all employees in the sector concerned, involving a considerable degree ofsolidarity. In determining the contributions payable, the Fund took no account ofthe risks associated with individual employees. The contributions were establishedfor all employees on the same basis, an average being calculated whereappropriate. The Fund was under an obligation to accept employees and the latterwere not required to undergo any prior medical examination. Finally, exemptionwas granted from the payment of contributions in the event of incapacity for work,so that pension rights accrued even during periods of incapacity for work.

34.

    In those circumstances, the Hoge Raad der Nederlanden stayed proceedingspending a preliminary ruling from the Court of Justice on the following questions:

'1.    Is a sectoral pension fund such as [the Fund], to which all or one or morespecified groups of employees in the relevant sector are obliged to beaffiliated by virtue of and in accordance with [the BPW], to be regarded asan undertaking within the meaning of Articles 85, 86 or 90 of the ECTreaty?

2.    Where a number of organisations which the Minister subsequently regardsas being sufficiently representative of the employers' associations and tradeunions in a particular sector, within the meaning of the first paragraph ofArticle 3 of [the BPW], apply to the Minister pursuant to that provision foraffiliation to a particular pension fund within the meaning of that Law to bemade compulsory, is that joint action on the part of those organisations tobe regarded as an agreement between undertakings, a decision byassociations of undertakings or a concerted practice within the meaning ofArticle 85(1) of the EC Treaty which, within the meaning of that Treatyprovision, (i) may affect trade between Member States and (ii) has as itsobject or effect the prevention, restriction or distortion of competitionwithin the common market?

3.    Is compulsory affiliation as described above to be regarded as a measurewhich may render ineffective the competition rules applicable to

undertakings, or, at least, as a measure by which a Member State requiresor favours the adoption of agreements contrary to Article 85 or reinforcestheir effects, or is that the case only in certain circumstances and, if so, inwhat circumstances?

4.    If Question 3 is to be answered in the negative, are there othercircumstances which may render such compulsory affiliation incompatiblewith the provisions of Article 90 of the EC Treaty and, if so, whatcircumstances?

5.    Can such compulsory affiliation be regarded as the grant to a sectoralpension fund of an exclusive right within the meaning of Article 90(1) of theEC Treaty, and is such pension fund placed as a result in a dominantposition which it abuses merely by exercising that exclusive right, inparticular on the ground that such compulsory affiliation may affect tradebetween Member States and the provision of services is limited, contrary tosubparagraph (b) of the second paragraph of Article 86, to the detrimentof compulsorily affiliated undertakings and/or employees?

    Or, can such compulsory affiliation create a situation in which a pensionfund is induced to commit such an abuse or is at least placed in a positionwhich it itself could not take up without infringing Article 86, whilst, in anyevent, a system of undistorted competition is not guaranteed?

6.    If such compulsory affiliation is contrary to Community law, does that meanthat it is not legally valid?‘

The second question

35.

    By its second question, which it is appropriate to consider first, the national courtseeks essentially to ascertain whether a decision taken by the organisationsrepresenting employers and workers in a given sector, in the context of a collectiveagreement, to set up in that sector a single pension fund responsible for managinga supplementary pension scheme and to request the public authorities to makeaffiliation to that fund compulsory for all workers in that sector is contrary toArticle 85 of the Treaty.

36.

    Drijvende Bokken contends that the request by management and labour to makeaffiliation to a sectoral pension fund compulsory constitutes an agreement betweenthe undertakings operating in the sector concerned, contrary to Article 85(1) of theTreaty.

37.

    Such an agreement, in its view, restricts competition in two ways. First, byentrusting the operation of a compulsory scheme to a single manager, it deprivesthe undertakings operating in the sector concerned of the possibility of affiliation

to another pension scheme managed by other insurers. Second, that agreementexcludes the latter insurers from a substantial part of the pension insurance market.

38.

    The repercussions of such an agreement for competition are 'appreciable‘ in thatit affects the entire Netherlands dock sector. Those repercussions are aggravatedby the cumulative effect of making affiliation to pension schemes compulsory innumerous sectors of the economy and for all undertakings in those sectors.

39.

    Finally, such an agreement affects trade between Member States in that it concernsundertakings which engage in cross-frontier business and it deprives insurersestablished in other Member States of the opportunity to offer a full pensionscheme in the Netherlands either by virtue of cross-frontier services or throughbranches or subsidiaries.

40.

    It must be noted, first, that Article 85(1) of the Treaty prohibits all agreementsbetween undertakings, decisions by associations of undertakings and concertedpractices which may affect trade between Member States and which have as theirobject or effect the prevention, restriction or distortion of competition within thecommon market. The importance of that rule prompted the authors of the Treatyto provide expressly in Article 85(2) of the Treaty that any agreements or decisionsprohibited pursuant to that article are to be automatically void.

41.

    Next, it is important to bear in mind that, under Article 3(g) and (i) of the ECTreaty (now, after amendment, Article 3(1)(g) and (j) EC), the activities of theCommunity are to include not only a 'system ensuring that competition in theinternal market is not distorted‘ but also 'a policy in the social sphere‘. Article2 of the EC Treaty (now, after amendment, Article 2 EC) provides that a particulartask of the Community is 'to promote throughout the Community a harmoniousand balanced development of economic activities‘ and 'a high level of employmentand of social protection‘.

42.

    In that connection, Article 118 of the EC Treaty (Articles 117 to 120 of the ECTreaty have been replaced by Articles 136 EC to 143 EC) provides that theCommission is to promote close cooperation between Member States in the socialfield, particularly in matters relating to the right of association and collectivebargaining between employers and workers.

43.

    Article 118b of the EC Treaty (Articles 117 to 120 of the EC Treaty having beenreplaced by Articles 136 EC to 143 EC) adds that the Commission is to endeavourto develop the dialogue between management and labour at European level whichcould, if the two sides consider it desirable, lead to relations based on agreement.

44.

    Moreover, Article 1 of the Agreement on social policy (OJ 1992 C 191, p. 91)states that the objectives to be pursued by the Community and the Member Statesinclude improved living and working conditions, proper social protection, dialogue

between management and labour, the development of human resources with a viewto lasting high employment and the combatting of exclusion.

45.

    Under Article 4(1) and (2) of the agreement on social policy, the dialogue betweenmanagement and labour at Community level may lead, if they so desire, tocontractual relations, including agreements, which will be implemented either inaccordance with the procedures and practices specific to management and labourand the Member States, or, at the joint request of the signatory parties, by aCouncil decision on a proposal from the Commission.

46.

    It is beyond question that certain restrictions of competition are inherent incollective agreements between organisations representing employers and workers. However, the social policy objectives pursued by such agreements would beseriously undermined if management and labour were subject to Article 85(1) ofthe Treaty in seeking jointly to adopt measures to improve conditions of work andemployment.

47.

    It therefore follows from an interpretation of the provisions of the Treaty as awhole which is both effective and consistent that agreements concluded in thecontext of collective negotiations between management and labour in pursuit ofsuch objectives must, by virtue of their nature and purpose, be regarded as notfalling within the scope of Article 85(1) of the Treaty.

48.

    The next question is therefore whether the nature and purpose of the agreementat issue in the main proceedings justify its exclusion from the scope of Article 85(1)of the Treaty.

49.

    First, like the category of agreements referred to above which derive from socialdialogue, the agreement at issue in the main proceedings was concluded in theform of a collective agreement and constitutes the result of collective negotiationsbetween organisations representing employers and workers.

50.

    Second, as far as its purpose is concerned, that agreement establishes, in a givensector, a supplementary pension scheme managed by a pension fund to whichaffiliation may be made compulsory. Such a scheme seeks, as a whole, toguarantee a certain level of pension for all workers in that sector and thereforecontributes directly to improving one of their working conditions, namely theirremuneration.

51.

    Consequently, the agreement at issue in the main proceedings does not, by reasonof its nature and purpose, fall within the scope of Article 85(1) of the Treaty.

52.

    The answer to be given to the second question must therefore be that a decisiontaken by organisations representing employers and workers in a given sector, in thecontext of a collective agreement, to set up in that sector a single pension fundresponsible for managing a supplementary pension scheme and to request the

public authorities to make affiliation to that fund compulsory for all workers in thatsector does not fall within the scope of Article 85 of the Treaty.

The third question

53.

    By its third question, which it is appropriate to consider secondly, the national courtseeks essentially to ascertain whether Articles 3(g), 5 and 85 of the Treaty prohibita decision by the public authorities to make affiliation to a sectoral pension fundcompulsory at the request of organisations representing employers and workers ina given sector.

54.

    Drijvende Bokken considers that, by creating a legal framework for and accedingto a request from the two sides of industry to make affiliation to the sectoralpension fund compulsory, the public authorities favoured or furthered theimplementation and operation of agreements between undertakings operating inthe sectors concerned which are contrary to Article 85(1) of the Treaty, therebyinfringing Articles 3(g), 5 and 85 of the Treaty.

55.

    As the Court has held, in particular in Van Eycke, cited above, paragraph 16,Article 85 of the Treaty is itself concerned only with the conduct of undertakingsand not with legislation adopted by Member States. However, according to settledcase-law of the Court of Justice, Article 85 of the Treaty, read in conjunction withArticle 5, requires the Member States not to introduce or maintain in forcemeasures, whether legislative or regulatory, which may render ineffective thecompetition rules applicable to undertakings. Such is the case, according to thesame case-law, where a Member State requires or favours the adoption ofagreements, decisions or concerted practices contrary to Article 85 of the Treatyor reinforces their effects or deprives its own legislation of its official character bydelegating to private traders responsibility for taking decisions affecting theeconomic sphere (see also Case C-2/91 Meng [1993] ECR I-5751, paragraph 14;Case C-185/91 Reiff [1993] ECR I-5801, paragraph 14; Case C-245/91 OhraSchadeverzekeringen [1993] ECR I-5851, paragraph 10; Case C-35/96 Commissionv Italy [1998] ECR I-3851, paragraphs 53 and 54; and Case C-266/96 Corsica FerriesFrance v Gruppo Antichi Ormeggiatori del Porto di Genova and Others [1998] ECRI-3949, paragraphs 35, 36 and 49).

56.

    In that connection, the request made to the public authorities by the organisationsrepresenting employers and workers to make affiliation to the sectoral pension fundset up by them compulsory is part of a regime established under a number ofnational laws, designed to exercise regulatory authority in the social sphere. Sincethe agreement at issue in the main proceedings does not fall within the scope ofArticle 85(1) of the Treaty, as is clear from the answer given to the secondquestion, the Member States are free to make it compulsory for persons who arenot bound as parties to the agreement.

57.

    Moreover, Article 4(2) of the Agreement on social policy expressly provides that,at Community level, management and labour may apply jointly to the Council forthe implementation of social agreements.

58.

    The decision of the public authorities to make affiliation to such a fund compulsorycannot therefore be regarded as requiring or favouring the adoption of agreements,decisions or concerted practices contrary to Article 85 of the Treaty or reinforcingtheir effects.

59.

    It follows from the foregoing considerations that the decision of the publicauthorities to make affiliation to a sectoral pension fund compulsory does not fallwithin the categories of legislative measures which, according to the case-law of theCourt, undermine the effectiveness of Articles 3(g), 5 and 85 of the Treaty.

60.

    The answer to the third question must therefore be that Articles 3(g), 5 and 85 ofthe Treaty do not prohibit a decision by the public authorities to make affiliationto a sectoral pension fund compulsory at the request of organisations representingemployers and workers in a given sector.

The first question

61.

    By its first question, which it is appropriate to consider thirdly, the national courtseeks essentially to ascertain whether a pension fund responsible for managing asupplementary pension scheme set up by a collective agreement concluded betweenorganisations representing employers and workers in a given sector and to whichaffiliation has been made compulsory by the public authorities for all workers inthat sector is an undertaking within the meaning of Article 85 et seq. of the Treaty.

62.

    According to the Fund and the governments which have intervened, such a funddoes not constitute an undertaking within the meaning of Article 85 et seq. of theTreaty. They describe the various characteristics of the sectoral pension fund andof the supplementary pension scheme which it manages.

63.

    First, compulsory affiliation of all workers in a given sector to a supplementarypension scheme pursues an essential social function within the pension systemapplicable in the Netherlands because of the extremely limited amount of thestatutory pension, calculated on the basis of the minimum statutory wage. Providedthat a supplementary pension scheme has been established by a collectiveagreement within a framework laid down by law and affiliation to that scheme hasbeen made compulsory by the public authorities, it constitutes an element of theNetherlands system of social protection and the sectoral pension fund responsiblefor management of it must be regarded as contributing to the management of thepublic social security service.

64.

    Second, the sectoral pension fund is non-profit-making. It is managed jointly byboth sides of the industry, who are equally represented on its managementcommittee. The sectoral pension fund collects an average contribution fixed by thatcommittee which strikes a balance, collectively, between the amount of thepremiums, the value of the benefits and the extent of the risks. Moreover, thecontributions may not fall below a certain level, so as to establish adequatereserves, and may not, in order to preserve its non-profit-making status, exceed anupper limit, observance of which is ensured by the social partners and theInsurance Board. Even though the contributions levied are invested on acapitalisation basis, the investments are made under the control of the InsuranceBoard and in accordance with the provisions of the PSW and the statutes of thesectoral pension fund.

65.

    Third, operation of the sectoral pension fund is based on the principle of solidarity. Such solidarity is reflected by the obligation to accept all workers without a priormedical examination, the continuing accrual of pension rights despite exemptionfrom contributions in the event of incapacity for work, the discharge by the fundof arrears of contributions due from an employer in the event of the latter'sinsolvency and by the indexing of the amount of pensions in order to maintain theirvalue. The principle of solidarity is also apparent from the absence of anyequivalence, for individuals, between the contribution paid, which is an averagecontribution not linked to risks, and pension rights, which are determined byreference to an average salary. Such solidarity makes compulsory affiliation to thesupplementary pension scheme essential. Otherwise, if 'good‘ risks left thescheme, an ensuing negative spiral effect would jeopardise its financial equilibrium.

66.

    In view of the foregoing, the Fund and the intervening governments consider thatthe sectoral pension fund constitutes an organisation charged with the managementof social security schemes of the kind referred to in the judgment in Joined CasesC-159/91 and C-160/91 Poucet and Pistre [1993] ECR I-637, and is unlike theorganisation at issue in Case C-244/94 Fédération Française des Sociétés d'Assuranceand Others v Ministère de l'Agriculture et de la Pêche [1995] ECR I-4013, which wasregarded as an undertaking within the meaning of Article 85 et seq. of the Treaty.

67.

    It should be borne in mind that, in the context of competition law, the Court hasheld that the concept of an undertaking encompasses every entity engaged in aneconomic activity, regardless of the legal status of the entity and the way in whichit is financed (see, in particular, Case C-41/90 Höfner and Elser [1991] ECR I-1979,paragraph 21; Poucet and Pistre, cited above, paragraph 17; and FédérationFrançaise des Sociétés d'Assurance, cited above, paragraph 14).

68.

    Moreover, in Poucet and Pistre, cited above, the Court held that that concept didnot encompass organisations charged with the management of certain compulsorysocial security schemes, based on the principle of solidarity. Under the sicknessand maternity scheme forming part of the system in question, the benefits were the

same for all beneficiaries, even though contributions were proportional to income;under the old-age insurance scheme, retirement pensions were funded by workersin employment; furthermore, the pension entitlements determined by law were notproportional to the contributions paid into the old-age insurance scheme; finally,schemes which were in surplus contributed to the financing of those with structuralfinancial difficulties. Such solidarity necessarily implied that the various schemesshould be managed by a single organisation and that affiliation to the schemesshould be compulsory.

69.

    In contrast, in Fédération Française des Sociétés d'Assurance, cited above, the Courtheld that a non-profit-making organisation which managed an old-age insurancescheme intended to supplement a basic compulsory scheme, established by law asan optional scheme and operating according to the principle of capitalisation, wasan undertaking within the meaning of Article 85 et seq. of the Treaty. Optionalaffiliation, application of the principle of capitalisation and the fact that benefitsdepended solely on the amount of the contributions paid by the beneficiaries andon the financial results of the investments made by the managing organisationimplied that that organisation carried on an economic activity in competition withlife assurance companies. Neither the pursuit of a social objective, nor the fact thatit was non-profit-making, nor the requirements of solidarity, nor the other rulesconcerning, in particular, the restrictions to which the managing organisation wassubject in making investments altered the fact that the managing organisation wascarrying on an economic activity.

70.

    The question whether the concept of an undertaking, within the meaning of Article85 et seq. of the Treaty, extends to a body such as the sectoral pension fund atissue in the main proceedings must be considered in the light of the foregoingconsiderations.

71.

    In that connection, it must be observed that the sectoral pension fund itselfdetermines the amount of the contributions and benefits and that the Fundoperates in accordance with the principle of capitalisation.

72.

    Accordingly, by contrast with the benefits provided by organisations charged withthe management of compulsory social security schemes of the kind referred to inPoucet and Pistre, cited above, the amount of the benefits provided by the Funddepends on the financial results of the investments made by it, in respect of whichit is subject, like an insurance company, to supervision by the Insurance Board.

73.

    In addition, as is apparent from Article 5 of the BPW and Articles 1 and 5 of theGuidelines for exemption from affiliation, a sectoral pension fund is required togrant an exemption to an undertaking where the latter has already made availableto its workers for at least six months before the request was lodged, on the basisof which affiliation to the fund was made compulsory, a pension scheme grantingthem rights at least equivalent to those which they would acquire if affiliated to thefund. Moreover, under Article 1 of the abovementioned Guidelines, that fund is

also entitled to grant an exemption to an undertaking which provides its workerswith a pension scheme granting them rights at least equivalent to those derivingfrom the fund, provided that, in the event of withdrawal from the fund,compensation considered reasonable by the Insurance Board is offered for anydamage suffered by the fund, from the actuarial point of view, as a result of thewithdrawal.

74.

    It follows that a sectoral pension fund of the kind at issue in the main proceedingsengages in an economic activity in competition with insurance companies.

75.

    In those circumstances, the fact that the fund is non-profit-making and themanifestations of solidarity referred to by the fund and the intervening governmentsare not sufficient to deprive the sectoral pension fund of its status as anundertaking within the meaning of the competition rules of the Treaty.

76.

    Undoubtedly, pursuit of a social objective, the abovementioned manifestations ofsolidarity and restrictions or controls on investments made by the sectoral pensionfund may render the service provided by the fund less competitive than comparableservices rendered by insurance companies. Although such constraints do notprevent the activity engaged in by the fund from being regarded as an economicactivity, they might justify the exclusive right of such a body to manage asupplementary pension scheme.

77.

    The answer to the first question must therefore be that a pension fund chargedwith the management of a supplementary pension scheme set up by a collectiveagreement concluded between organisations representing employers and workersin a given sector, to which affiliation has been made compulsory by the publicauthorities for all workers in that sector, is an undertaking within the meaning ofArticle 85 et seq. of the Treaty.

The fifth question

78.

    By its fifth question, which it is appropriate to consider fourthly, the national courtseeks essentially to ascertain whether Articles 86 and 90 of the Treaty preclude thepublic authorities from conferring on a pension fund an exclusive right to managea supplementary pension scheme in a given sector.

79.

    The Netherlands Government contends that the order making affiliationcompulsory has the sole effect of requiring workers in the sector concerned to beaffiliated to the Fund. That order does not in its view confer on the Fund anexclusive right in the area of supplementary pensions. Nor does the Fund hold adominant position within the meaning of Article 86 of the Treaty.

80.

    It must be observed at the outset that the decision of the public authorities, as inthis case, to make affiliation to a sectoral pension fund compulsory necessarilyimplies granting to that fund an exclusive right to collect and deal with thecontributions paid with a view to accruing pension rights. Such a fund musttherefore be regarded as an undertaking to which exclusive rights have beengranted by the public authorities, of the kind referred to in Article 90(1) of theTreaty.

81.

    Next, it should be noted that, according to settled case-law, an undertaking whichhas a legal monopoly in a substantial part of the common market may be regardedas occupying a dominant position within the meaning of Article 86 of the Treaty(see Case C-179/90 Merci Convenzionali Porto di Genova [1991] ECR I-5889,paragraph 14, and Case C-18/88 GB-Inno-BM [1991] ECR I-5941, paragraph 17).

82.

    A sectoral pension fund of the kind at issue in the main proceedings, which has anexclusive right to manage a supplementary pension scheme in an industrial sectorof a Member State and, therefore, in a substantial part of the common market,may therefore be regarded as occupying a dominant position within the meaningof Article 86 of the Treaty.

83.

    It must also be pointed out, however, that merely creating a dominant position bygranting exclusive rights within the meaning of Article 90(1) of the Treaty is not initself incompatible with Article 86 of the Treaty. A Member State is in breach ofthe prohibitions contained in those two provisions only if the undertaking inquestion, merely by exercising the exclusive rights granted to it, is led to abuse itsdominant position or when such rights are liable to create a situation in which thatundertaking is led to commit such abuses (Höfner and Elser, cited above, paragraph29; Case C-260/89 ERT [1991] ECR I-2925, paragraph 37; Merci ConvenzionaliPorto di Genova, cited above, paragraphs 16 and 17; Case C-323/93 Centred'Insémination de la Crespelle [1994] ECR I-5077, paragraph 18; and Case C-163/96Raso and Others [1998] ECR I-533, paragraph 27).

84.

    Drijvende Bokken contends in that connection that the system of compulsoryaffiliation to the supplementary pension scheme managed by the Fund is contraryto the combined provisions of Articles 86 and 90 of the Treaty. The pensionbenefits available from the Fund do not, or no longer, match the needs of theundertakings. Those benefits are too low, are not linked to salaries and,consequently, are inherently inadequate. Employers should therefore adopt otherpension arrangements. The system of compulsory affiliation deprives thoseemployers of any opportunity of arranging for comprehensive pension cover froman insurance company. Pension arrangements with a number of insurers wouldincrease administrative expenses and reduce efficiency.

85.

    It should be remembered that, in Höfner and Elser, cited above, paragraph 34, theCourt held that a Member State which conferred on a public employment agencyan exclusive right of recruitment was in breach of Article 90(1) of the Treaty where

it created a situation in which that office could not avoid infringing Article 86 of theTreaty, in particular because it was manifestly incapable of satisfying the demandprevailing on the market for such activities.

86.

    In the present case, it is important to note that the supplementary pension schemeoffered by the Fund is based on the present norm in the Netherlands, namely thatevery worker who has paid contributions for the maximum period of affiliation tothat scheme receives a pension, including the pension under the AOW, equal to70% of his final salary.

87.

    Doubtless, some undertakings in the sector might wish to provide their workerswith a pension scheme superior to the one offered by the Fund. However, the factthat such undertakings are unable to entrust the management of such a pensionscheme to a single insurer and the resulting restriction of competition derivedirectly from the exclusive right conferred on the sectoral pension fund.

88.

    It is therefore necessary to consider whether, as contended by the Fund, theNetherlands Government and the Commission, the exclusive right of the sectoralpension fund to manage supplementary pensions in a given sector and the resultantrestriction of competition may be justified under Article 90(2) of the Treaty as ameasure necessary for the performance of a particular social task of generalinterest with which that fund has been charged.

89.

    Drijvende Bokken contends that compulsory affiliation to the sectoral pension fundis not necessary to ensure an adequate level of pension for workers. That aimcould be attained by minimum requirements for pensions, to be laid down eitherby the two sides of industry at the instigation of the public authorities or directlyby the public authorities. Collective employment agreements frequently include anobligation on employers to provide a minimal pension scheme, whilst at the sametime leaving them free to establish a pension fund specific to their undertaking, toaffiliate themselves to a sectoral pension fund or to make arrangements with aninsurance company.

90.

    According to Drijvende Bokken, the payment of an 'average premium‘ likewisedoes not justify compulsory affiliation. First, neither the BPW nor the ordermaking affiliation compulsory requires a system based on a premium of that kind. Second, a number of sectoral pension funds to which affiliation is not compulsoryoperate perfectly well on the basis of 'average contributions‘.

91.

    As regards acceptance of all workers in the same area of activity without a priormedical examination so that 'bad‘ risks cannot be refused, Drijvende Bokkenobserves that in practice the pension insurance contracts concluded with insurersrequire the employer to declare all his workers and an obligation on the insurer toaccept any worker declared without prior medical examination.

92.

    It is important to bear in mind first of all that, under Article 90(2) of the Treaty,undertakings entrusted with the operation of services of general economic interestare subject to the rules on competition in so far as the application of such rulesdoes not obstruct the performance, in law or in fact, of the particular tasks assignedto them.

93.

    In allowing, in certain circumstances, derogations from the general rules of theTreaty, Article 90(2) of the Treaty seeks to reconcile the Member States' interestin using certain undertakings, in particular in the public sector, as an instrument ofeconomic or fiscal policy with the Community's interest in ensuring compliance withthe rules on competition and preservation of the unity of the common market(Case C-202/88 France v Commission [1991] ECR I-1223, paragraph 12, and CaseC-157/94 Commission v Netherlands [1997] ECR I-5699, paragraph 39).

94.

    In view of the interest of the Member States thus defined they cannot beprecluded, when determining what services of general economic interest to entrustto certain undertakings, from taking account of objectives pertaining to theirnational policy or from endeavouring to attain them by means of obligations andconstraints which they impose on such undertakings (Commission v Netherlands,cited above, paragraph 40).

95.

    The supplementary pension scheme at issue in the main proceedings fulfils anessential social function within the Netherlands pensions system by reason of thelimited amount of the statutory pension, calculated on the basis of the minimumstatutory wage.

96.

    Moreover, the importance of the social function attributed to supplementarypensions has recently been recognised by the Community legislature's adoption ofCouncil Directive 98/49/EC of 29 June 1998 on safeguarding the supplementarypension rights of employed and self-employed persons moving within theCommunity (OJ 1998 L 209, p. 46).

97.

    It must next be borne in mind that it is not necessary, in order for the conditionsfor the application of Article 90(2) of the Treaty to be fulfilled, that the financialbalance or economic viability of the undertaking entrusted with the operation of aservice of general economic interest should be threatened. It is sufficient that, inthe absence of the rights at issue, it would not be possible for the undertaking toperform the particular tasks entrusted to it, defined by reference to the obligationsand constraints to which it is subject (Commission v Netherlands, cited above,paragraph 52) or that maintenance of those rights is necessary to enable the holderof them to perform tasks of general economic interest which have been assignedto it under economically acceptable conditions (Case C-320/91 Corbeau [1993] ECRI-2533, paragraphs 14 to 16, and Commission v Netherlands, cited above, paragraph53).

98.

    If the exclusive right of the fund to manage the supplementary pension scheme forall workers in a given sector were removed, undertakings with young employees ingood health engaged in non-dangerous activities would seek more advantageousinsurance terms from private insurers. The progressive departure of 'good‘ riskswould leave the sectoral pension fund with responsibility for an increasing share of'bad‘ risks, thereby increasing the cost of pensions for workers, particularly thosein small and medium-sized undertakings with older employees engaged indangerous activities, to which the fund could no longer offer pensions at anacceptable cost.

99.

    Such a situation would arise particularly in a case where, as in the mainproceedings, the supplementary pension scheme managed exclusively by the Fundis characterised by a high level of solidarity resulting, in particular, from the factthat contributions do not reflect the risk, from the obligation to accept all workerswithout a prior medical examination, the continuing accrual of pension rightsdespite exemption from the payment of contributions in the event of incapacity forwork, the discharge by the Fund of arrears of contributions due from an employerin the event of insolvency and the indexing of the amount of pensions in order tomaintain their value.

100.

    Such constraints, which render the service provided by the Fund less competitivethan a comparable service provided by insurance companies, go towards justifyingthe exclusive right of the Fund to manage the supplementary pension scheme.

101.

    It follows that the removal of the exclusive right conferred on the Fund might makeit impossible for it to perform the tasks of general economic interest entrusted toit under economically acceptable conditions and endanger its financial equilibrium.

102.

    Referring to GB-Inno-BM, cited above, Drijvende Bokken considers, however, thatthe fact that the Fund fulfils a dual role, as manager of the pension scheme and asthe authority vested with the power to grant exemptions, might give rise to unfairexercise of the power of exemption.

103.

    In paragraph 28 of GB-Inno-BM, cited above, the Court held that Articles 3(g), 86and 90 of the Treaty preclude a Member State from granting to the undertakingwhich operates the public telecommunications network the power to lay downstandards for telephone equipment and to check that economic operators meetthose standards when it is itself competing with those operators on the market forthat equipment.

104.

    In paragraph 25 of the last-mentioned judgment, the Court considered that thevesting in such a company of powers both to authorise or refuse the connection oftelephones to the network and to lay down the technical standards to be met bysuch equipment and verify whether devices not manufactured by it conformed withthe specifications adopted by it was tantamount to conferring upon it the power to

determine at will which terminal equipment might be connected to the publicnetwork, thereby placing it at an obvious advantage over its competitors.

105.

    However, the situation in the main proceedings differs from that in GB-Inno-BM.

106.

    It should be noted, first, that under Article 5(1) of the Guidelines for exemptionfrom affiliation, a sectoral pension fund is required to grant an exemption to anundertaking where the latter has already made available to its workers for at leastsix months before the request was lodged, on the basis of which affiliation to thefund was made compulsory, a pension scheme granting them rights at leastequivalent to those which they would acquire if affiliated to the fund.

107.

    Provided that the abovementioned provision is binding on the sectoral pension fundregarding the exercise of its power of exemption, it cannot be regarded as likely tolead the fund to abuse that power. In such circumstances, the fund merely checksthat the conditions laid down by the competent minister are complied with (see, tothat effect, Joined Cases C-46/90 and C-93/91 Lagauche and Others [1993] ECRI-5267, paragraph 49).

108.

    It must then be remembered that, under Article 1 of the Guidelines for exemptionfrom affiliation, a sectoral pension fund is entitled to grant an exemption to anundertaking which provides its workers with a pension scheme granting them rightsat least equivalent to those deriving from the fund, provided that, in the event ofwithdrawal from the fund, compensation considered reasonable by the InsuranceBoard is offered for any damage suffered by the fund, from the actuarial point ofview, as a result of the withdrawal.

109.

    The abovementioned provision thus enables a sectoral pension fund to exemptfrom the obligation of affiliation an undertaking which provides its workers with apension scheme equivalent to the one managed by it if such an exemption does notendanger its financial equilibrium. Exercise of that power of exemption involvesan evaluation of complex data relating to the pension schemes involved and thefinancial equilibrium of the fund, which necessarily implies a wide margin ofappreciation.

110.

    In view of the complexity of such an evaluation and of the risks which exemptionsinvolve for the financial equilibrium of a sectoral pension fund and, therefore, forperformance of the social task entrusted to it, a Member State may consider thatthe power of exemption should not be attributed to a separate entity.

111.

    It should, however, be noted that national courts adjudicating, as in this case, onan objection to a requirement to pay contributions must subject to review thedecision of the fund refusing an exemption from affiliation, which enables them atleast to verify that the fund has not used its power to grant an exemption in anarbitrary manner and that the principle of non-discrimination and the otherconditions for the legality of that decision have been complied with.

112.

    Finally, as regards Drijvende Bokken's argument that an adequate level of pensionfor workers could be assured by laying down minimal requirements to be met bypensions offered by insurance companies, it must be emphasised that, in view of thesocial function of supplementary pension schemes and the margin of appreciationenjoyed, according to settled case-law, by the Member States in organising theirsocial security systems (Case 238/82 Duphar and Others [1984] ECR 523, paragraph16; Poucet and Pistre, cited above, paragraph 6; and Case C-70/95 Sodemare andOthers [1997] ECR I-3395, paragraph 27), it is incumbent on each Member Stateto consider whether, in view of the particular features of its national pensionsystem, the laying down of minimum requirements would still enable it to ensurethe level of pension which it seeks to guarantee in a sector by compulsory affiliationto a pension fund.

113.

    The answer to the fifth question must therefore be that Articles 86 and 90 of theTreaty do not preclude the public authorities from conferring on a pension fund theexclusive right to manage a supplementary pension scheme in a given sector.

The fourth and sixth questions

114.

    In view of the answer given to the fifth question, it is unnecessary to answer thefourth and sixth questions.

Costs

115.

    The costs incurred by the Netherlands, German, French and Swedish Governmentsand by the Commission, which have submitted observations to the Court, are notrecoverable. Since these proceedings are, for the parties to the main proceedings,a step in the proceedings pending before the national court, the decision on costsis a matter for that court.

On those grounds,

THE COURT,

in answer to the questions referred to it by the Hoge Raad der Nederlanden byjudgment of 6 June 1997, hereby rules:

1.    A decision taken by organisations representing employers and workers ina given sector, in the context of a collective agreement, to set up in thatsector a single pension fund responsible for managing a supplementarypension scheme and to request the public authorities to make affiliation to

that fund compulsory for all workers in that sector does not fall within thescope of Article 85 of the EC Treaty (now Article 81 EC).

2.    Article 3(g) of the EC Treaty (now, after amendment, Article 3(1)(g) EC),Article 5 of the EC Treaty (now Article 10 EC) and Article 85 of the Treatydo not prohibit a decision by the public authorities to make affiliation toa sectoral pension fund compulsory at the request of organisationsrepresenting employers and workers in a given sector.

3.    A pension fund charged with the management of a supplementary pensionscheme set up by a collective agreement concluded between organisationsrepresenting employers and workers in a given sector, to which affiliationhas been made compulsory by the public authorities for all workers in thatsector, is an undertaking within the meaning of Article 85 et seq. of theTreaty.

4.    Articles 86 and 90 of the EC Treaty (now Articles 82 EC and 86 EC) do notpreclude the public authorities from conferring on a pension fund theexclusive right to manage a supplementary pension scheme in a givensector.

Rodríguez IglesiasPuissochet Hirsch Jann Moitinho de Almeida Gulmann Murray Edward Ragnemalm Sevón Wathelet

Delivered in open court in Luxembourg on 21 September 1999.

R. Grass

G.C. Rodríguez Iglesias

Registrar

President

1: Language of the case: Dutch.