JUDGMENT OF 6. 10. 1983 — JOINED CASES 118 TO 123/82 CELANT v COMMISSION

In Joined Cases 118 to 123/82

THE COURT (Second Chamber) composed of: P. Pescatore, President of Chamber, O. Due and K. Bahlmann, Judges, Advocate General: G. Reischl Registrar: P. Heim

gives the following

JUDGMENT

Facts and Issues

The facts of the case, the course of the procedure and the conclusions, submissions and arguments of the parties may be summarized as follows:

I — Facts

The six applicants were employed as established staff at the Joint Research Centre at Ispra until the entry into force on 1 November 1976 of Council Regulation No 2615/76 of 21 October 1976 amending Regulation No 259/68 as regards the Conditions of Employment of Other Servants of the European Communities (Official Journal L 299, p. 1).

In Regulation No 2615/76 the Council expressed the view that “without prejudice to the principles of the Staff Regulations, certain amendments should be made to the Conditions of Employment of Other Servants of the European Communities so that they can more aptly be applied to staff paid from the research and investment appropriations” and abolished the status of establishment staff at the Joint Nuclear Research Centre, substituting for it by way of an addition to Article 2 of Regulation No 259/68 a fourth category of temporary staff, namely:

Staff engaged to fill temporarily a permanent post paid from research and investment appropriations and included in the list of posts appended to the budget relating to the institution concerned.

To facilitate the transition from the system of establishment staff to that of temporary staff Article 2 of Regulation No 2615/76 included a certain number of transitional provisions.

Thus Article 2 (1) provided that a member of the establishment staff paid from the research and investment appropriations who was in service on the date on which the regulation came into force was to be offered a contract by the competent authority on the terms applicable to temporary staff under the Conditions of Employment of Other Servants of the European Communitites, and the contract was to take effect on that date.

In relation to social security Article 1 (8) of Regulation No 2615/76 amended the first sentence of Article 39 (2) of the Conditions of Employment of Other Servants so as to enable a member of the former establishment staff, now a member of the temporary staff, to a retirement pension on the terms provided for in Title V, Chapter 3, of the Staff Regulations (Articles 77 to 84) and Annex VIII to the Staff Regulations.

Among the transitional provisions the first paragraph of Article 2 (4) of Regulation No 2615/76 provided that in the case of establishment staff in service on the date on which the regulation came into force, calculation of the length of service referred to in the first paragraph of Article 77 of the Staff Regulations, under which an official who, has completed at least 10 years' service is entitled to a retirement pension, must take account of the number of years of service completed by him as a member of the establishment staff.

However, under the second paragraph of Article 2 (4), only the years of service completed by staff in their new capacity, as temporary staff are to be taken into account for the purpose of calculating the years of pensionable service within the meaning of Article 2 of Annex VIII to the Staff Regulations, which provides :

“A retirement pension shall be payable on the basis of the total number of years of pensionable service acquired by the official. Each year of service reckoned as provided for in Article 3 shall entitle him to one year of pensionable service and each complete month to one twelfth of a year of pensionable service.”

Nevertheless, the Commission decided to apply in the present case by analogy Article 11 (2) of Annex VIII to the Staff Regulations, which gives an official who enters the service of the Communities after leaving the service of a government administration or of a national or international organization or of an undertaking the right, on becoming established with the Community, to pay to it either:

the actuarial equivalent of retirement pension rights acquired by him in the government administration, national or international organization or undertaking; or

the sums repaid to him from the pension fund of the government administration, organization or undertaking at the date of his leaving its service.

In such a case the institution in which the official serves must determine, taking into account his grade on establishment, the number of years of pensionable service with which he is to be credited under its own pension scheme in respect of the former period of employment, on the basis of the amount of the actuarial equivalent or sums repaid.

After appointment as temporary staff former establishment staff were offered the opportunity of requesting the transfer, in accordance with the general provisions for implementing Article 11 (2) of Annex VIII to the Staff Regulations (published in the Staff Courier of 19 October 1977), of the actuarial equivalent of, or sums repaid for, the pension rights acquired by them under the national social security schemes to which they had previously belonged as establishment staff depending on their place of employment.

At the Joint Research Centre at Ispra a notice already published in Staff Courier No 391 of 14 June 1978 was circulated on 13 July 1978 informing temporary staff previously affiliated to the Italian social security scheme, the Istituto Nazionale della Previdenza Sociale, that the transfer of their pension rights to the Community scheme was now possible as the result of an agreement made in Rome on 2 March 1978 between the Istituto Nazionale della Previdenza Sociale and the Community.

Those concerned were asked to make an application for a transfer before 13 December 1978 and to complete a questionnaire for that purpose.

A circular dated 10 April 1979 informed the temporary staff concerned that they could postpone their ultimate decision until they were given precise information as to the number of years of pensionable service which would be taken into account in determining their Community pension, on the basis of the actuarial equivalent to be transferred.

The temporary staff concerned, including the six applicants, were notified in June and July 1981 of the exact calculation of the years of pensionable service attributed to them on the basis of the years of service prior to their employment as temporary staff pursuant to Article 11 (2) of Annex VIII to the Staff Regulations; at the same time they were asked to make a decision within 30 days in relation to the transfer of any pension rights acquired under the various national social security schemes.

Within a short time the applicants confirmed that they opted for the transfer of their pension rights to the Community scheme, but they expressed reservations as to the method of calculating the years of pensionable service attributed to them.

In September 1981, or in one case October 1981, the applicants submitted complaints to the Commission pursuant to Article 90 (2) of the Staff Regulations concerning the fact that in determining their Community pension rights the Commission had not taken into account all the years of pensionable service completed by them as establishment staff.

II — Written procedure

When their complaints brought no response within four months of being lodged the applicants brought actions, the first two on 5 April 1982 (Cases 118/82 and 119/82) and the remaining four on 6 April 1982 (Cases 120/82, 121/82, 122/82 and 123/82), challenging the Commission's implied rejection of their complaints.

Express decisions rejecting the complaints were made in March 1982.

By order dated 29 April 1982 the Court (Second Chamber) decided with the agreement of the parties to join the six cases for the purposes of the proceedings and judgment.

The written procedure followed the normal course.

Upon hearing the report of the Judge-Rapporteur and the views of the Advocate General the Court (Second Chamber) decided to open the oral procedure without any preparatory inquiry.

For the purposes of the hearing the Court (Second Chamber) requested the parties to confine their oral argument to the first submission made by the applicants and not to discuss admissibility or the second and third submissions, on which the Court considered it had obtained sufficient information from the written procedure; it also requested the applicants not to go more fully into the “additional considerations” set out in the reply.

In addition, the Commission was asked to produce an expert capable of explaining to the Court in non-technical language the system of transfer contemplated by Article 11 (2) of Annex VIII to the Staff Regulations and the method of calculation used in determining the rights of the applicants.

III — Conclusions of the parties

The applicants each claim that the Court should:

Annul the measure whereby the Commission took into account only partially in calculating the Community retirement pension the length of service completed by the applicant prior to his or her appointment as a member of the temporary staff;

Declare that the Commission is under an obligation to recognize for the purpose of calculating the pension the entire period of service completed by the applicant as its employee;

Order the defendant to pay the costs.

The Commission contends that the Court should:

Declare the applications inadmissible and unfounded on the merits and as such dismiss them;

Order the applicants to pay the costs.

IV — Submissions and main arguments of the parties in the written procedure

A — Admissibility

The Commission considers the applications to be inadmissible because they have been brought after the expiry of the periods prescribed by the Staff Regulations.

For the purpose of admissibility the relevant measure is not the notification to the applicants of the definitive calculation of their years of service prior to their engagement as temporary staff but the decision adopted previously to apply to former establishment staff Article 11 (2) of Annex VIII to the Staff Regulations. The notification of the definitive calculation was merely the logical consequence and contemporaiy application of a decision adopted long before.

The decision to apply Article 11 (2) of Annex VIII to the Staff Regulations was brought to the attention of the staff concerned in June and July 1978; it is that which constitutes the measure capable of adversely affecting the applicants within the meaning of Articles 90 and 91 of the Staff Regulations. The alteration of the applicants' position under the Staff Regulations is a direct result of that decision which permitted them to ascertain precisely and in detail the effects and limits of their personal situation as regards the determination of pension rights acquired as establishment staff.

The applicants consider that their applications are perfectly admissible: the first measure whereby the Commission committed itself expressly and definitively in the matter was its decision fixing the number of years of pensionable service to be taken into account in determining the retirement pension.

The Commission's decision to apply by analogy Article 11 (2) of Annex VIII to the Staff Regulations cannot in any event, and apart from the question whether and when those concerned liad knowledge of it, be regarded as a measure “adversely affecting” them, capable of being the subject of an administrative complaint and thus of legal proceedings.

The injury to the applicants' individual interests was revealed only at a later stage when two essential conditions had been fulfilled: the exercise by the person concerned of the option to repurchase the years of previous pensionable service for the determination of the Community pension, and the calculation of those years of pensionable service as years counting towards a Community pension.

That understanding was shared by the administration itself, which invited those concerned to specify their employment prior to their appointment as temporary staff without prejudice to the ultimate decision which they would be called upon to take when they knew the assessment of the actuarial equivalent of the pension rights they had acquired previously.

In those circumstances a complaint challenging normative decisions of a general scope not personally notified to those concerned or published in the official information media, and adopted several years before those concerned were called upon to opt for a Community pension and informed of the extent to which their previous service would be taken into account, would have been much more open to objection as inadmissible in the absence of any immediate injury to the interests of the staff in question.

B — Substance

The applicants base their applications on alleged infringement of the Treaty and of the rules of law relating to its implementation inasmuch as the application by analogy of Article 11 (2) of Annex VIII to the Staff Regulations is inappropriate in their case, infringement of the principle of non-discrimination and misuse of powers; in their reply they put forward “additional considerations” based on the Commission's application of a weighting factor.

The Commission considers all the submissions to be unfounded.

Application by analogy of Article 11 (2) of Annex VIII to the Staff Regulations

The applicants maintain that the application to their case by analogy of Article 11 (2) of Annex VIII to the Staff Regulations is unlawful.

a) That provision governs a situation which is different from theirs in substance. Its wording and spirit show that it was obviously intended to take into account as far as possible periods of work completed otherwise than in the service of the Communities. The applicants, on the other hand, were employed by the Communities themselves. The application of Article 11 (2) is without justification either in law or, in a wider sense, in equity.

b) If the Commission found that there was a lacuna and felt the need to have recourse to analogy the latter should have been drawn not with previous employment outside the Community, in which the Commission has no responsibility, but with employment as an official in the Community. The position of former local and establishment staff is almost identical to that of auxiliary staff since in both cases the employment is with the Commission; the principles expounded by the Court in its judgment of 1 February 1979 in Case 17/78 (Deshormes v Commission [1979] ECR 189) are thus applicable. Moreover, the Commission takes into account for the purposes of the pension the whole period spent as an auxiliary in all cases where the official has performed during the period for which he was an auxiliary the same duties as those entrusted to him in the department in which he has subsequently been established. As regards former local and establishment staff there is no doubt that they continue to perform in their new capacity the same duties as they carried out in the past.

c) Objections concerning the financing of the providence scheme in relation to previous employment cannot be accepted. The Commission is responsible for the share of the financing for which the employer is liable. It is, moreover, required to take part in financing the pension schemes for its own officials; finally contributions charged on the salary of former local and establishment staff appear to be in no way less — quite the contrary — than the portion of the salary of established offficials paid into the Community pension scheme. Neither the relative shares nor the amount of the contributions can therefore justify the measures adopted by the Commission. It is also necessary to emphasize that recognition of all the previous years of pensionable service of the applicants would in no way have conferrred on them an unfair financial advantage over those who had been affiliated to the Community pension scheme from the beginning. The contributions paid by the applicants to the Istituto Nazionale were higher than those paid under the Community scheme, the proportion paid by the institution to the Istitutio Nazionale was not less than that paid for its own established officials, and transfer of the actuarial equivalent to the Commission would put it in the same position as it would have been if it had assumed responsibility for local and establishment staff as regards social security from the beginning. The reciprocity between the respective obligations and rights of the parties is practically the same as in the relationship between the Commission and established officials.

d) In their reply the applicants claim that Regulation No 2615/76 is unlawful in so far as the contested measures were adopted in implementation of it and in so far as it provides that service completed as establishment or local staff is recognized only for the purpose of accumulating sufficient years of pensionable service to entitle the employee to a pension.

e) The judgment of the Court of 1 April 1971 in Case 54/70 (Landra v Com mission [1971] ECR 311), cited by the Commission, is irrelevant to the present case: at issue here is not the overlapping of two pension schemes, but an option for a single Community insurance scheme. Moreover, the applicants' affiliation to an insurance scheme other than the Community scheme is attributable to the institutions alone and the Commission cannot hold against the applicants a situation which it has itself created.

The Commission is of the opinion that in the present case it has merely applied the law and followed the case-law of the Court.

a) The provision in Regulation No 2615/76 to the effect that only the years of service completed by staff as temporary staff are to be taken into account for the purpose of calculating the years of pensionable service to be counted in computing the Community pension applies the basic principle governing the whole Community social security scheme defined in Article 83 of the Staff Regulations. The latter establishes a close correlation between the acquisition of the retirement pension and the financing by the person concerned of the fund created for the purpose of paying the pension.

b) According to the judgment in the Landra case contributions to a scheme outside the Communities cannot automatically give rise to the acquisition of Community pension rights and pension rights acquired in the case of staff subject to the Conditions of Employment of Other Servants before their establishment can be recognized only in respect of temporary staff, who unlike other staff have been affiliated to the Community social security scheme and have contributed to the Community pension fund since their engagement. The judgment in the Deshormes case was given in a context completely different from that of the present case.

c) The application in the present case of Article 11 (2) of Annex VIII to the Staff Regulations is consistent with the decision in the Landra case. The result of that application must be that the amount transferred is credited to the employee in years of pensionable service calculated according to the rules and subject to the restrictions normally applied by the Communities. Any additional charge on the Community budget in order to allow complete assimilation of the previous period of service if the actuarial equivalent proved inadequate would have no legal justification, would constitute a breach of the principle of mutuality on which the whole Community social security scheme is based and, in the final analysis, would give those concerned an unfair financial advantage. If the social security schemes are to be properly managed, there must of necessity be a correlation between the' contributions paid and the pension payable. In that respect it must be emphasized that although the contributions paid to the pension fund of the Istituto Nazionale both by the Community institutions and by their staff exceeded for a short time those provided for by the Community social security scheme, they did so only when expressed as a percentage of the gross salary and not in absolute terms; the decisive factor in calculating the years of pensionable service to be taken into account for the purpose of the Community pension, however, is the total amount of the actuarial equivalent credited with the Istituto Nazionale and transferred to the pension fund of the EEC. Moreover, the mechanism for converting the actuarial equivalent of pension rights previously acquired into years of pensionable service to be taken into account for the purpose of the Community pension certainly does not always have disadvantageous results for those concerned; the result depends in each case on the weight attached to the value of the various factors involved in making the conversion (the amount transferred, age, grade on establishment, and so on).

d) The objection that Regulation No 2615/76 is unlawful is a new issue raised during the proceedings in breach of Articles 38 and 42 of the Rules of Procedure and is therefore inadmissible. In any event no legal argument has been adduced in support of the objection and the regulation in question merely implements the fundamental principle of the Community social security scheme as defined in Article 83 of the Staff Regulations.

The principle of non-discrimination

The applicants maintain that the contested measures also disregard the principle that there must be no discrimination between staff who have performed in the service of the same institution duties substantially identical to those of persons who have been established from the beginning as officials.

a) The applicants' duties before and after 1 November 1976 have remained the same, their staff reports have been approved, they have not been required to serve any probationary period and their previous seniority has been fully taken into account for the purpose of the new classification and for calculating the years of pensionable service necessary for the attribution of a retirement pension. In those circumstances there is no justification for making a distinction when determining the pension in favour of those who have had the good fortune to be appointed as officials from the date of their entry into the Community institutions.

b) If the applicants' previous employment is only partially recognized it will also mean that even if they continue to work until they have reached the age-limit they will obtain only a modest pension.

c) It is true that the attribution to the applicants of their new status has improved their legal position and reduced the most blatant discrimination vis-à-vis their colleagues who are established officials; nevertheless their situation remains precarious, particularly as regards social security.

The Commission challenges the applicants' argument on both legal and factual grounds.

a) The failure to take fully into account the pension rights acquired under national social security schemes is a result not only of the basic principle of correspondence between contributions and pension rights but also of the fact that there are several schemes to which staff of the Communities are subject. In the present case the schemes are governed by the Staff Regulations and are quite independent of one another, and the principle of non-discrimination cannot be applied to them. The principle may be applied within the same category of staff; it cannot, however, restrict the power of a public administration to employ side by side with officials engaged on the basis of a competition staff bound by a contractual relationship governed by specific provisions.

b) The classification of the applicants in the category of temporary staff does not in fact reduce the terms of their pension: their Community pension is certainly not less, and in all likelihood much higher, than that which they would have received under the national scheme.

c) More generally, it must be observed that the position of temporary staff is the result of a definite choice of legislative policy made deliberately by the Community institutions with the aim of reconciling a maximum number of guarantees for staff under the Staff Regulations with the flexibility indispensable to the organization of research; moreover, the position of such staff is not as unfavourable as the applicants maintain, especially as regards the retirement scheme.

The submission concerning misuse of powers

The applicants maintain that Article 11 (2) of Annex VIII to the Staff Regulations has in the present case been put to a purpose other than that intended by the legislature and has created, moreover, a manifestly unjust and unlawful situation: unlawful because it is intended to govern a technically and substantively different case; unjust because it assimilates employment within the Community with employment outside it.

The Commission observes that this submission merely repeats the arguments put forward in the other two submissions without adding any fresh element.

The “additional considerations”

In their reply the applicants challenged the lawfulness of applying, independently of any monetary conversion, a weighting of 157.8 to the basic salary expressed in Belgian francs; the result was a considerable reduction in their years of pensionable service. Moreover no opportunity was offered to the applicants of converting their entitlement vis-à-vis the national insurance institutions at the rate of exchange in force at the date of transfer.

The Commission points out that this is a completely new claim aimed at enlarging the object of the originating applications, made without any prior complaint under Article 90 of the Staff Regulations and thus wholly inadmissible.

In any event, in order to determine the basic salary of officials during 1976, when the periodic adjustment of salaries took place not by means of an adjustment of the salary scales but by applying a weighting, it was necessary to apply the weighting in force at the time to the figure taken from the scale.

V — Oral procedure

At the sitting on 5 May 1983 the applicants, represented by Giuseppe Marchesini, and the Commission, represented by Paolo de Caterini, presented oral argument particularly in relation to the application by analogy of Article 11 (2) of Annex VIII to the Staff Regulations. They also answered certain questions put by the Court; for that purpose Counsel for the Commission was assisted by R. Tanzilli, Head of Division in the Directorate General for Personnel and Administration, appearing as an expert witness.

The Advocate General delivered his opinion at the sitting on 7 July 1983.

Decision

1. By applications received at the Court Registiy on 5 and 6 April 1982 respectively Maria Grazia Celant and five other applicants, temporary staff of the Commission employed at the Joint Research Centre at Ispra, brought actions for the annulment of Commission decisions determining the length of service completed by the applicants for the purpose of calculating their retirement pension following their transfer from the Italian social security scheme to the pension scheme for officials and other servants of the Community.

2. It appears from the file that the applicants were originally employed as “establishment staff” at the Joint Research Centre at Ispra and that in that capacity they were affiliated to the Italian social security scheme operated by the Istituto Nazionale della Previdenza Sociale (hereinafter referred to as “the Istituto Nazionale”).

3. Council Regulation No 2615/76 of 21 October 1976 amending Regulation No 259/68 as regards the Conditions of Employment of Other Servants of the European Communities (Official Journal L 299, p. 1) abolished the status of establishment staff and made the applicants temporary staff under Article 2 of the Conditions of Employment of Other Servants, to which henceforth a new category was added, defined by the new subparagraph (d) to Article 2 thus:

“(d) Staff engaged to fill temporarily a permanent post paid from research and investment appropriations and included in the list of posts appended to the budget relating to the institution concerned.”

4. Regulation No 2615/76 also brought the former establishment staff into the Community pension scheme by amending Article 39 (2) of the Conditions of Employment to read as follows:

“On leaving the service, a servant within the meaning of Article 2 (c) or (d) shall be entitled to a retirement pension or severance grant as provided for in Title V, Chapter 3 of the Staff Regulations and Annex VIII to the Staff Regulations.”

5. The first paragraph of Article 2 (4) of Regulation No 2615/76 provides as a transitional measure for the benefit of establishment staff who have acquired the status of temporary staff that the years of service completed as establishment staff are to be taken into account when applying the first paragraph of Article 71 of the Staff Regulations of Officials, according to which entitlement to a retirement pension is conditional upon completion of at least 10 years' service.

6. The second paragraph of Article 2 (4) of Regulation No 2615/76 provides, however, that only the years of service completed by former establishment staff as temporary staff are to be taken into account for the purpose of calculating the years of pensionable service within the meaning of Article 2 of Annex VIII to the Staff Regulations.

7. For reasons of equity the Commission nevertheless decided to apply by analogy to former establishment staff who so requested the provisions of Article 11 (2) of Annex VIII to the Staff Regulations, which allows an official who enters the service of the Community institutions after being affiliated to a national social security scheme to have transferred to the Communities the actuarial equivalent of the retirement pension rights which he has acquired under the national scheme. In such a case the institution in which the official is employed determines, taken into account his grade on establishment, the number of years of pensionable service with which to credit him under its own pension scheme on the basis of the amount of that actuarial equivalent.

8. On 2 March 1978 an agreement was made between the Communities and the Istituto Nazionale for the purpose of transferring to the Community scheme the pension rights of staff previously affiliated to the Italian pension scheme.

9. Following that agreement the Commission published an announcement in Staff Courier No 391 of 14 June 1978. Shortly afterwards, on 13 July 1978, it circulated the same notice to the Joint Research Centre at Ispra to bring the agreement to the notice of those concerned and fixed 13 December 1978 as the final date for submitting requests for a transfer. A circular of 10 April 1979 informed the temporary staff concerned that they might postpone their final decision until they were given exact details of the years of pensionable service calculated for the purpose of determining their Community pension, on the basis of the actuarial equivalent to be transferred.

10. The applicants, who had given notice of their intention to take advantage of that opportunity, were notified in June and July 1981 of the precise number of years of pensionable service with which they were to be credited; at the same time they were asked to make a final decision on the matter within 30 days.

11. All the applicants confirmed their wish to exercise the option of transferring their pension rights to the Community scheme, but they expressed reservations as to the method of calculating the years of pensionable service with which they were to be credited.

12. Subsequently they brought complaints under Article 90 (2) of the Staff Regulations concerning the Commission's failure to take into account in determining their Community pension rights all the years of pensionable service completed by them as establishment staff. When those complaints received no answer within the period specified in the Staff Regulations the present applications were brought on 5 and 6 April 1982.

Admissibility

13. The Commission contends that the relevant measure in determining the time-limit for bringing an action is not the notification to the applicants of the definitive calculation of their rights in June and July 1981 but the decision to apply to former establishment staff Article 11 (2) of Annex VIII to the Staff Regulations, which was brought to the attention of those concerned in June and July 1978. It is that decision which is the measure which may adversely affect the applicants within the meaning of Articles 90 and 91 of the Staff Regulations. That is when the applicants were in a position to appreciate precisely the effects and limits of their personal situation and ought to have brought their actions. The notification of the definitive calculation in 1981 was only the logical consequence of a decision taken long before and which was not challenged in due time.

14. The objection raised by the Commission must be dismissed as contrary to the good faith which must govern relations between the Community administration and its officials and other staff, notwithstanding the existence of a dispute.

15. It must be observed in that respect that the notices circulated in June and July 1978 were not decisions but offers to the staff concerned, the results of which depended on their acceptance; In addition, in view of the complexity of the calculations used to determine as regards each of the applicants individually the actuarial equivalent to the rights acquired under the national scheme to which they had previously been affiliated and the conversion thereof into years of pensionable service according to the rules of the Community scheme, it is obvious that the applicants were not in a position usefully to make any complaint or to bring an action before the date of the decisions notified in June and July 1981.

Substance

16. The applicants' complaints are attributable to the fact that the actuarial equivalent established by the Italian institution has been reassessed by the Community according to its own actuarial rules with the result that the number of years of pensionable service credited to the applicants is appreciably less than the period of their employment at the Joint Research Centre of the Community. The applicants do not deny that the existing actuarial rules have been correctly applied on both sides; their claim relates to the issue whether by applying its own actuarial rules the Community may reduce the years of pensionable service taken into account in determining their Community pension to a period shorter than the time for which they had actually been employed.

17. They complain that the Commission adopted a false analogy, to their de triment, in assimilating the position of former establishment staff to that of officials who enter the service of the Community after employment in the administration of a Member State or with private employers. In their opinion the appropriate analogy is not with the position contemplated by Article 11 (2) of Annex VI II to the Staff Regulations but with the position of established officials, since the applicants, as distinct from the persons contemplated by Article 11 (2) of Annex VIII, have worked from the beginning with the Community. In their reply the applicants challenged the validity of Regulation No 2615/76 on the ground that Article 2 (4) thereof recognized service completed as establishment staff only as regards completion of the minimum length of service required to give entitlement to a pension but excluded consideration thereof for the purpose of determining the number of years of pensionable service.

18. In the second place, the applicants consider that the difference in treatment between themselves and officials amounts to discrimination against them. Finally they claim that the Commission's conduct amounts to a misuse of powers.

19. In their reply the applicants raised a fresh issue based on the Commission's application of a weighting which appears in the documents in which the applicants' salary is determined in Belgian francs at the date on which they become temporary staff. They consider that the application of the weighting resulted in a considerable reduction of their number of years of pensionable service.

20. That issue must be disregarded as being out of time. It was introduced only in the reply and did not enable the Commission to submit a proper defence, especially as its scope is not adequately explained in the documents submitted by the applicants.

21. As for the submissions based on breach of the principle of non-discrimination and alleged misuse of powers, they overlap in fact with the first submission concerning the alleged false analogy between the position of the applicants and that of persons contemplated by Article 11 (2) of Annex VIII. Those submissions may therefore be considered together.

22. As regards the arguments put forward by the applicants it must be observed in the first place that it is not possible to question the differences in status between the various categories of persons employed by the Communities, whether as officials properly so called or in the various categories of staff covered by the Conditions of Employment of Other Servants. As the Commission rightly stated, each of those categories is defined in accordance with the legitimate requirements of the Community administration and the nature of the permanent or temporary tasks which it has to perform. The fact that some categories of persons employed by the Communities may enjoy guarantees under the Staff Regulations and social security benefits which are not given to other categories cannot, therefore, be regarded as discrimination. In particular it must be pointed out that a general feature of the position of staff covered by the Conditions of Employment is the contractual nature of the employment relationship and the affiliation of a considerable proportion of such staff to the national social security institutions of either their country of origin or their place of residence.

23. In the second place the applicants freely accepted by contract their status as establishment staff which entailed affiliation to the social security scheme of their country of residence. Similarly, it must be emphasized that the transfer from the Italian social security scheme to the Community pension scheme was an option which the applicants had and freely exercised when they had precise knowledge of the consequences. They had the opportunity then to assess the advantages and disadvantages of their choice and to make a decision in accordance with their interests.

24. Quite apart from those considerations, the issues raised by the applicants concerning the validity of the transitional provisions in Regulation No 2615/76 and the measure adopted by the Commission are not well founded.

25. When it decided to abolish the status of establishment staff and to transfer such staff to the category of temporary staff the Council gave former establishment staff, by means of an addition to Article 39 of the Conditions of Employment, the right to a Community pension in accordance with the Staff Regulations and Annex VIII thereto with effect from the time they became temporary staff. By means of the transitional provision in the first paragraph of Article 2 (4) of Regulation No 2615/76 the Council enabled, in the applicants' interests, the length of their service as establishment staff to be recognized for the purpose of the condition referred to in the first paragraph of Article 77 of the Staff Regulations, which makes entitlement to a pension conditional upon having completed at least ten years' service. The second paragraph of Article 2 (4) of Regulation No 2615/76, the validity of which the applicants challenge, states that the same period of service is not to be taken into account in calculating the years of pensionable service which determine the amount of pension within the meaning of Article 2 of Annex VIII to the Staff Regulations. The provision does not remove any of the applicants' rights since it is intended only to specify what is already a consequence of Article 39 (2) of the Conditions of Employment and which is, moreover, in accordance with the general principles governing the temporal effect of laws. The Council was under no obligation to make transitional provisions in favour of the applicants more advantageous than those arising from Regulation No 2615/76.

26. Similarly, the Commission was under no obligation to give the applicants additional benefits in relation to a pension in excess of those which result from the application of Regulation No 2615/76. It cannot therefore be reproached for having provided, in the interest of those concerned, an option regarding the application of Article 11 (2) of Annex VIII to the Staff Regulations. Contrary to what the applicants maintain, the solution offered by the Commission is not based on a false analogy. The position of the applicants has in common with that of those referred to by the provision cited the fact that before their admission to the Community pension scheme they were affiliated to another social security scheme. The fact that such affiliation was based on an employment relationship with a Community institution does not alter the position of the applicants since the arrangement, which those concerned freely accepted when they entered employment, was part and parcel of their particular status.

27. The applicants cannot therefore claim full enjoyment of the Community pension scheme retroactively and without any consideration on their part. The only machinery compatible with sound financial management of the Community pension scheme in the event of retroactive recognition of periods of insurance is the application of Article 11 of Annex VIII to the Staff Regulations which allows the transfer of the actuarial equivalent in order to cover the liabilities assumed by the Community scheme for periods in respect of which it previously had no responsibility.

28. Since the establishment of the actuarial equivalent by the original social security institution and its reassessment on the basis of the rules applicable under the Community's pension scheme are based on different particulars and considerations regarding the history of those concerned, their future prospects, the amount of contributions and the nature and amount of benefits, it does not seem abnormal that the determination of the years of pensionable service to be taken into account for the Community pension leads to a different figure from the years of pensionable service taken into account by the national institution. Since such years of pensionable service have relevance only in relation to benefits to which they give entitlement under the various national and Community schemes, they are not comparable inter se save to bring into account in actuarial terms an assessment both of the personal position of each person concerned and the general characteristics of the social security schemes in question. The applicants, who have confined themselves to making a comparison between themselves and Community officials, have produced no factor capable of raising doubt as to whether the actuarial formulae used by the Community properly translate the relationship between the actuarial equivalent reached by the Italian institution and the reassessment thereof according to the criteria of the Community scheme.

29. It follows from all the foregoing that in proposing to the applicants a transfer to the Community pension scheme on terms which are compatible with the Staff Regulations the Commission has not acted unlawfully in their respect, that it has not discriminated against them and that it has not misused its powers.

30. The applications must therefore be dismissed.

Costs

31. Under Article 69 (2) of the Rules of Procedure the unsuccessful party is to be ordered to pay the costs.

32. However, under Article 70 of the Rules of Procedure costs incurred by the institutions in proceedings by servants of the Communities are to be borne by the institutions.

33. The Court may nevertheless, under the second paragraph of Article 69 (3) of the Rules of Procedure, order a successful party to pay costs which the Court considers that party to have unreasonably or vexatiously caused the opposite party to incur. It is right to apply that provision against the Commission which has unnecessarily complicated the proceedings by raising a patently ill-founded objection as to admissibility. The Commission must therefore be ordered to pay part, assessed as one third, of the costs of the applicants.

On those grounds, THE COURT (Second Chamber) hereby:

1 Dismisses the applications.

2 Orders the Commission to bear its own costs and one third of the applicant's costs, the remainder of their costs to be borne by the applicants.