Report for the Hearing delivered in Case C-108/89

I — The facts

A — Legal background

1 The national legislation

Article 25 of Royal Decree No 50 of 24 October 1967 on retirement and survivors' pensions for employed persons provides that ‘save in such cases and under such circumstances as may be determined by the King, retirement pensions and survivors' pensions shall be payable only if the recipient is not engaged in any profession or occupation and does not receive an allowance in respect of sickness, invalidity or involuntary unemployment under Belgian or foreign social security legislation or an allowance in respect of the interruption of his career or a reduction of benefits’

The first paragraph of Article 64 bis of the Royal Decree of 21 December 1967 laying down general rules governing retirement and survivors' pensions, adopted under that article, provides that ‘an invalidity pension or any benefit in lieu thereof, granted under the scheme of a foreign country or a scheme applicable to the staff of an institution governed by public international law, shall be regarded as standing in the place of a retirement pension for the application of Articles 20(1) and 25 of Royal Decree No 50 where the recipient satisfies the requirements for commencement of the retirement pension laid down by Article 4(l)(a) or (2) or (3) or (4) of the same decree’

2 Community law

Articles 48 and 51 of the EEC Treaty provide, within the sphere of social security, for freedom of movement for workers

Article 12(2) of Regulation (EEC) No 1408/71 of the Council of 14 June 1971 on the application of social security schemes to employed persons and their families moving within the Community provides that there may be applied to a pensioner provisions for reduction, suspension or withdrawal of benefits contained in national legislation in the event of the overlapping of a benefit with other social security benefits, even those acquired under the legislation of another Member State, except as regards benefits of the same kind in respect of invalidity, old age, death or occupational disease

Article 46 of the same regulation concerns the award of benefits and contains provisions for the calculation thereof

B — Background to the dispute

Augusto Pian was born on 9 June 1922 in Italy He worked in Belgium from 1947 to 1951 as a miner and, from 1952 to 1971, as an employed person He then went to Italy where he worked until 1978

Since 1 March 1978, he has received a Belgian retirement pension based on an occupational insurance record of 5/45ths — giving an amount of BFR 21759 — as a miner He also receives an Italian invalidity pension

On 4 June 1982, Augusto Pian applied for the early retirement pension provided for in Article 5 of Royal Decree No 50 on the basis of service performed in Belgium from 1952 to 1971 as an employed person By an administrative decision notified on 5 August 1983, the Office national de pensions (National Pensions Office, hereinafter referred to as ‘the ONP’) rejected his application on the ground that he was in receipt of an Italian invalidity pension The refusal was based on Articles 25 of Royal Decree No 50 of 24 October 1967 and 64 bis of the Royal Decree of 21 December 1967

Mr Pian challenged that decision before the tribunal du travail (Labour Tribunal), Liège, which, by judgment of 9 May 1985, dismissed his application as unfounded

C — The questions referred to the Court for a preliminary ruling

By order of 24 March 1989, the cour du travail, Liège, before which an appeal had been brought by Mr Pian against the abovementioned judgment, stayed the proceedings and asked the Court of Justice to give a preliminary ruling under Article 177 of the EEC Treaty on the following three questions:

‘(1) Where a migrant worker has become entitled to a personal invalidity pension in one Member State, without application of the Community regulations, and asserts in another Member State rights to a benefit on the basis of his employment, without application of the Community regulations, is it compatible with Articles 48 and 51 of the Treaty of Rome for the institution in the second State, which grants the retirement pension, to take into account the invalidity pension granted by the first State in order to apply the rules laid down in its own national legislation for the prevention of overlapping benefits, just as it takes into account invalidity benefits granted under its own legislation? (2) If so, where the legislation of a Member State treats in a different manner the overlapping of a retirement pension granted under such legislation with an invalidity benefit or an old-age benefit, how must an invalidity pension granted by another Member State which is not convertible into an old-age pension be treated: must it be treated as an invalidity benefit or as an old-age benefit? Should a distinction possibly be made according to whether or not the recipient of the invalidity pension has reached retirement age or is receiving an old-age benefit? Must a distinction be drawn according to whether the retirement pension is claimed at the normal age or is applied for early (with a reduction of the amount)? (3) With reference to Questions 1 and 2, must the retirement age be (a) that prescribed by the legislation containing the provision on overlapping, or (b) that laid down by the legislation providing for the nonconvertible benefit to which the rules on overlapping are applied?’

The national court considers that an answer to those questions is required from the Court of Justice in view of the divergence in the Community case-law regarding the question whether, for the purposes of Article 12(2) of Regulation No 1408/71, the decision as to the nature of the benefits granted under the national legislation, on the one hand, and the benefits awarded by another Member State, on the other, is a matter of Community law or not (inter alia, judgment of 15 October 1980 in Case 4/80 D'Amico [1980] ECR 2951, on the one hand, and, on the other, judgment of 6 October 1987 in Case 197/85 Stefanutti [1987] ECR 3855)

II — Procedure

The order for reference was received at the Court Registry on 5 April 1989

Pursuant to Article 20 of the Protocol on the Statute of the Court of Justice of the European Communities, written observations were submitted by:

Augusto Pian, the plaintiff in the main proceedings, represented by Jules Raskin and Michèle Raskin, of the Liège Bar;

the ONP, the defendant in the main proceedings, represented by R Masyn, its Director-General ;

the Commission of the European Communities, represented by its Legal Adviser Jean-Claude Séché, acting as Agent

Upon hearing the Report of the Judge-Rapporteur and the views of the Advocate General, the Court decided to open the oral procedure without any preparatory inquiry

III — Summary of the written observations submitted to the Court

The plaintiff in the main proceedings relies on previous decisions of the Court (judgments of 18 April 1989 in Case 128/88 Di Felice [1989] ECR 923 and of 2 July 1981 in Joined Cases 116/80 and 117/80 and 119/80 to 121/80 Celestre [1981] ECR 1737) to show that the Italian invalidity pension and the Belgian early retirement pension are to be regarded as benefits of the same kind, within the meaning of Article 12(2) of Regulation No 1408/71 Accordingly, the Belgian early retirement pension should have been awarded to him, since the Italian benefit could not impede the grant of such a pension

According to the ONP, a distinction must be drawn between, on the one hand, a case where the early retirement pension payable by Belgium is awarded pursuant to Belgian law alone and, on the other, a case where the same pension is granted pursuant to the Community regulations

In the first case, Stefanutti applies The classification of the invalidity pension paid by Italy is not a matter of Community law, since the early retirement pension is acquired under Belgian legislation alone In the second case, the Community regulations apply, as interpreted by the decisions of the Court, in particular the judgment in D'Amico according to which the invalidity pension granted by Italy must be regarded as being of the same kind as an old-age benefit It is in such circumstances that Articles 46 and 12(2) of Regulation No 1408/71 come into play

The wording of the questions submitted to the Court relates only to the first hypothesis

Accordingly, the ONP considers that only the national legislature is empowered to determine whether the invalidity pension may be regarded as an invalidity benefit or an old-age benefit And indeed, the national legislature made it quite clear, in Article 64 bis of the Royal Decree of 21 December 1967, that a foreign invalidity benefit must be regarded as standing in the place of a retirement pension for the application of the national rules against overlapping benefits, where the normal conditions for the commencement of a retirement pension are satisfied

The retirement age must also be the age prescribed by the legislation containing the relevant provision against overlapping

The judgment of 18 April 1989 in Case 128/88 Di Felice v Inasti cited above, does not undermine the foregoing conclusions In fact, that case is distinguished from the present case in so far as the early retirement pension payable by Belgium is granted under the scheme for self-employed workers, for which no legislation similar to Article 64 bis cited above is at present in force

The Commission considers that—as held by the Court—‘so long as a worker is receiving a pension by virtue of national legislation alone, the provisions of Regulation (EEC) No 1408/71 do not prevent the national legislation alone, including the national rules against the overlapping of benefits, from being applied to him in its entirety, provided that if the application of such national legislation proves less favourable to the worker than the application of the rules laid down by Article 46 of Regulation (EEC) No 1408/71, the provisions of that article must be applied’ (judgments of 2 July 1981 in Joined Cases 116/80 and 117/80 and 119/80 to 121/80 Celestre cited above, and of 5 May 1983 in Case 238/81 Raad van Arbeid v Van der Bunt-Craig [1983] ECR 1385, and Di Felice, cited above)

Since the aggregation of the Italian insurance periods is not necessary to confer entitlement to the Belgian early retirement pension, the person concerned is entitled to the requisite pension under Belgian legislation alone In those circumstances, Community law does not prevent the application of the rule against overlapping in question (autonomous benefit)

For the calculation of the Community benefit, the competent institution must, in the first place, establish a theoretical amount, corresponding to the insurance record of the person concerned only in the country in question (Article 46(1) of Regulation No 1408/71) Pursuant to Article 12(2) of the same regulation, the rule against overlapping benefits in question is not applicable, since, according to a previous decision of the Court (Di Felice, cited above), the Italian invalidity pension and the early retirement pension are of the same kind

For the calculation of the pension, it is then necessary to calculate the apportioned amount pursuant to Article 46(2) and, finally, to make a comparison between the ‘autonomous’ benefit and the higher of the amounts resulting from the application of paragraphs 1 and 2 of Article 46 The higher of the two benefits thus compared will be granted

The Commission therefore proposes the following answers to the questions submitted by the cour du travail, Liège:

‘(1) So long as a worker, whether employed or self-employed, is receiving a pension by virtue of national legislation alone, neither Articles 48 and 51 of the EEC Treaty nor the provisions of Regulation No 1408/71 prevent the national legislation alone from being applied to him in its entirety, including the national rules against overlapping, provided that, if the application of that legislation proves less favourable to the worker than the application of the rules laid down by Article 46 of Regulation No 1408/71, that article must be applied (2) An early retirement pension acquired under the legislation of a Member State and an invalidity pension acquired under the legislation of another Member State are to be regarded as benefits of the same kind, within the meaning of Article 12(2) of Regulation No 1408/71 (3) Where a worker, whether self-employed or employed, is in receipt of benefits of the same kind in respect of invalidity and old-age which are awarded by the institutions of two or more Member States, in accordance with Article 46 of Regulation No 1408/71, the national legislative provisions for reduction, suspension or withdrawal do not apply by virtue of the last sentence of Article 12(2) of the regulation The amount referred to in Article 46(1) of the said regulation is the amount to which the worker would be entitled under national legislation if he were not in receipt of a pension from another Member State’

J C Moitinho de Almeida

Judge-Rapporteur

1 Language of the case: French