Opinion of Mr Advocate General Mancini

Mr President,

Members of the Court,

1. In this reference for a preliminary ruling the Court is asked to interpret two provisions (Articles 73 and 76) of Regulation 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 (Official Journal, English Special Edition, 1971 (II), p. 416). The Court is also asked to consider Article 10 of Regulation No 574/72 of the Council of 21 March 1972 fixing the procedure for implementing the earlier regulation (Official Journal, English Special Edition, 1972 (I), p. 159). A question of validity is also submitted regarding the latter provision, calling in question its compatibility with Article 51 of the EEC Treaty.

2. As will be seen, the problem giving rise to those questions is concerned with the payment of family allowances under United Kingdom law where the beneficiaries are the children of divorced parents residing in different Member States.

3. In order to answer those questions it is necessary in the first place to examine the question of entitlement to family allowances and then to clarify how that entitlement is affected by the Community provisions regarded as applicable in this case (which is concerned with the children of divorced parents) which this Court has been asked to consider by the Social Security Commissioner.

4. It seems to me that, in order to give the Social Security Commissioner a useful answer, it is appropriate to change the order of the questions submitted and to consider Question No 3 (a) first. By that question the Social Security Commissioner asks whether family benefits provided for by the law of a Member State [are] to be regarded (for the purposes of Article 10 of Regulation No 574/72) as due under Article 73 (1) of Regulation No 1408/71 for children normally residing outside the territory of a Member State if the law of that Member State qualifies a person for such family benefits only for children normally residing with him and he is normally residing in that Member State. In other words, the Commissioner, having been called upon to apply the rule contained in Article 10, wishes to know whether recourse to that provision renders necessary, under Community law, an assessment of the conditions upon which the application of Article 73 (1) of Regulation No 1408/71 is dependent. Both consideration of the United Kingdom and Irish national legislation relating to family allowances and the question of the interpretation of the expression member of the family used in Regulation No 1408/71 are matters raised by this problem.

5. It has thus been seen that, by virtue of the first sentence of the first paragraph of Article 10 of Regulation No 574/72, where, in the country in which the child resides, entitlement to the allowances is not subject to conditions of insurance or employment and the spouse of the worker does not work in that country, that entitlement is suspended. In other words, the lex loci laboris prevails, by virtue of the principle to which I referred earlier, whereby the costs of the social security scheme falls upon the State in which the worker is employed and to whose scheme he contributes.

6. A matter which is more debatable is the impact on the payment of the allowances and on the respective legal positions which the Insurance Officer attributes to divorce, once again in connection with the application of Article 10 of Regulation No 574/72.

7. Finally, I shall consider the other questions submitted by the Social Security Commissioner. I do so merely for the sake of completeness since in view of what I have said earlier they do not affect the present case.

8. Finally, some consideration should be given to the alleged invalidity of Article 10 of Regulation No 574/82 in so far as it operates to deprive a worker of family benefits to which he would be entitled under national law alone. The question is of course raised by the Social Security Commissioner on the assumption that the claimant is not to be awarded entitlement to family allowances for the children residing with her. I have rejected that view by explaining the detailed rules for implementing the rule against overlapping benefits. Like the other provisions preventing overlapping entitlement to benefits, that provision is not contrary to Article 51 of the EEC Treaty. The ratio of Article 51 and the very logic of the Community rules on social security in fact lead to the view that no harmful consequences for the worker are acceptable unless they are offset by advantages and in any case only if they are not of such a nature as to compromise the objectives of the Treaty.

9. In the light of all the considerations which I have put forward, I suggest that the following answers should be given to the questions submitted to the Court by the Social Security Commissioner by order of 5 May 1982:

1 Translated from the Italian.