Report for the Hearing in Case C-215/90

I — Facts and procedure

1. Legal background

Article 19(1) of Council Regulation (EEC) No 1408/71 of 14 June 1971 on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community, as codified by Council Regulation (EEC) No 2001/83 of 2 June 1983 (Official Journal 1983 L 230, p. 6) provides:

Article 25(1) of the same regulation provides:

Section 82(5) of the Social Security Act 1975 as it applies to the facts in the main proceedings provides:

2. The dispute in the main proceedings

Mrs Anne Maria Twomey, a United Kingdom national, was employed as a home help in London from May 1986 to 3 July 1987. Since then, she has never been in employment or self-employment.

On 19 July 1987, following separation from her husband, she moved to live in Ireland.

On 22 January 1988 her doctor in Ireland certified her as being unfit for work due to low back pain. On the same day, she applied to the Department of Social Welfare in Ireland for disability benefit. Her claim was referred to the United Kingdom Department of Social Security, to which Mrs Twomey formally applied for sickness benefit on 23 February 1988.

On 15 December 1988, the Social Security Appeal Tribunal, Newcastle upon Tyne, to which the claim had been referred by the Adjudication Officer, ruled that the provisions of Section 82(5) of the Social Security Act 1975, as amended, precluded entitlement to such benefits because Mrs Twomey was absent from Great Britain and, moreover, that those provisions were not in conflict with the provisions of Regulation (EEC) No 1408/71.

The Adjudication Officer subsequently appealed against that decision to a Social Security Commissioner who, by decision of 21 June 1990, stayed the proceedings and sought a preliminary ruling from the Court on the question:

Whether, upon the proper interpretation of Article 51 of the Treaty establishing the EEC and Article 19 of Regulation 1408/71 EEC, a national of a Member State resident in one Member State (Member State A) who becomes unfit for work by reason of sickness while resident in that Member State (Member State A), who prior to becoming so unfit was unemployed and who was last employed (or self-employed) in another Member State (Member State B), where that person also then resided is entitled to sickness benefit payable by the competent institution of Member State B (assuming that all conditions, other than those relating to residence, of the legislation of Member State B are satisfied for the purposes of entitlement to such benefit), or whether such a person's entitlement is governed solely by Article 25 of Regulation 1408/71

3. Procedure before the Court

The order for reference was received at the Court Registry on 23 July 1990.

In accordance with Article 20 of the Protocol on the Statute of the Court of Justice of the EEC, written observations were submitted by the Chief Adjudication Officer, represented by Michael Kent, Barrister, instructed by P. K. J. Thompson, Solicitor, and by the Commission of the European Communities, represented by Karen Banks, a member of its Legal Service, 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.

By decision of 15 May 1991, pursuant to Article 95(1) and (2) of the Rules of Procedure, the Court assigned the case to the Fifth Chamber.

II — Written observations submitted to the Court

The Chief Adjudication Officer, the appellant, considers that Article 25 of Regulation No 1408/71 (hereinafter referred to as the regulation) does not cover Mrs Twome/s situation. She did not go to Ireland in order to seek work, and is thus not within Article 69(1) of the regulation. Nor was she resident in Ireland when last employed, so she is thus not within Article 71(l)(b)(ii) as interpreted by the Court (see the judgment of 11 October 1984 in Case 128/83 Caisse Primaire d'Assurance Maladie de Rouen v Guyot [1984] ECR 3507).

In the appellant's view, it is none the less arguable that Mrs Twome/s case is covered by Article 19(1) because she is residing in the territory of a Member State (Ireland) other than the competent State (the United Kingdom) and she is covered by the phrase an employed or self-employed person as defined by Article 1(a) of the regulation.

The Chief Adjudication Officer's primary submission is that Article 19 is concerned only with the case of someone who was, when in work, residing in one Member State and, at the same time, working in another Member State. That article, which encompasses frontier workers, cannot have any application to the case of someone who resides and works in a single Member State, and who then seeks sickness benefit when in the territory of another Member State where he is staying or residing. Such a person's entitlement to sickness benefit is catered for, if at all, by Articles 22 and 25 of the regulation.

That interpretation of Article 19, which, in the Chief Adjudication Officer's opinion, provides in relation to sickness and maternity benefit a rule similar to that provided by Article 71 in relation to unemployment benefit, is consistent with the scheme of the regulation as a whole.

Thus a person (not being a frontier worker as defined in Article 1(b) of the regulation) who, while residing in Member State A and working in Member State B, falls ill, receives benefits in kind from State A and cash benefits from State B under Article 19(1). If he becomes unemployed he receives unemployment benefit from the competent institution of State A (if he makes himself available to the employment services of that State) under the first sentence of Article 71(l)(b)(ii). If he falls ill having already earlier become wholly unemployed, he is entitled to sickness benefit from the competent institution of State A under Article 25(2).

The appellant points out that in each of the examples given in the preceding paragraph, the regulation imposes no restriction on the period for which such entitlement endures. However, in the case of a person whose last employment was in a Member State where he then also resided, entitlement to unemployment benefit under the regulation arises only where such person is seeking work in another Member State, and is governed not by Article 71 but by Article 69 of the regulation (see the judgment in Guyot, cited above). In the Chief Adjudication Officer's submission, such a person's entitlement to sickness benefit should be governed by Article 25(1) and not by Article 19.

If, on the other hand, Article 19 were held to apply to Mrs Twome/s circumstances, the regulation would provide a more extensive right in the case of sickness and maternity benefit than in the case of unemployment benefit, which would be both anomalous and surprising.

The appellant submits therefore that the Court should place the same interpretation upon Article 19 as was placed upon Article 71 in Guyot, especially since, if the objectives of Article 51 of the Treaty are achieved in relation to unemployment benefit by the provisions of Chapter 6 of Title III of the regulation, it cannot be said that such objectives require any wider provisions in relation to sickness and maternity benefit.

The interpretation to the effect that Article 19 is concerned only with the case of a person who is at present or was formerly in active employment or self-employment in one Member State while at the same time residing in another Member State is supported, in the Chief Adjudication Officer's view, by Council Regulation (EEC) No 574/72 of 21 March 1972 laying down the procedure for implementing Regulation (EEC) No 1408/71 (codified version of 2 June 1983, Official Journal 1983 L 230, p. 6), Articles 17 and 18 of which contain the provisions for the implementation of Article 19 of Regulation No 1408/71.

Article 17(1) of Regulation No 574/72 provides :

and Article 17(8) provides:

In the appellant's submission, those provisions of Regulation No 574/72 are consistent only with the case of someone who, while in active employment or self-employment in one Member State is at the same time residing in another Member State.

The Chief Adjudication Officer relies finally in support of his argument on the Commission's Commentary on Regulation No 1408/71 (Compendium of Community Provisions on Social Security, third edition, 1988), in particular paragraph 4350 thereof:

That categorization of persons intended to be covered by Article 19 would, in the appellant's submission, be both unnecessary and too restrictive if Article 19 were to cover cases such as Mrs Twomey's.

In the alternative, the Chief Adjudication Officer submits that Article 19 has no application in a case such as Mrs Twome/s, on the ground that it is concerned only with those who are in active employment or self-employment or have been so up to the moment when the sickness giving rise to the claim supervenes. Consequently, someone like Mrs Twomey, who for reasons unconnected with sickness or maternity is already unemployed, is not covered by Article 19.

In the Chief Adjudication Officer's submission, at first sight, if the definition in Article 1(a) of the regulation is ignored, the provisions of Section 2 of Chapter 1 of Title III of the regulation (which is headed Employed persons or self-employed persons and members of their families and includes Article 19) apply only to those who are in employment or self-employment at or up to the time when they claim sickness or maternity benefit, in contradistinction to the provisions of Section 3 of the same chapter (headed Unemployed persons and members of their families and including Article 25), which applies to those who, before the date when sickness or maternity benefit is claimed, were already unemployed.

However, if the definition of employed person in Article 1(a) of the regulation is applied, Mrs Twomey appears to be covered by Article 19(1) because she falls within the category set out in a l(a)(ii) as interpreted by the Court (see the judgment of 29 September 1976 in Case 17/76 Brack v Insurance Officer [1976] ECR 1429, and the judgment of 22 May 1980 in Case 143/79 Walsh v National Insurance Officer [1980] ECR 1639).

The appellant adds that the Court, in its judgment of 31 May 1979 in Case 182/78 (Algemeen Ziekenfonds Drenthe-Platteland v Pierik [1979] ECR 1977), held that at least one of the provisions contained in Title III, Chapter 1, Section 2 (namely Article 22) was applicable to an inactive worker (namely a pensioner) who was not restricted to the provisions of Section 5 of that chapter (headed Pensioners and members of their families). By parity of reasoning, an unemployed person would be within at least some of the provisions of Title III, Chapter 1, Section 2, despite the apparent division of purpose indicated by the headings of the various sections.

The Chief Adjudication Officer nevertheless considers that the phrase employed and self-employed person, which appears in a number of the provisions of the regulation does not invariably correspond to the definition in Article 1(a) but only if the context does not otherwise require.

He submits that, in order to avoid the restrictive conditions laid down in Article 25 for the receipt of sickness benefit in the case of unemployed persons and their families being circumvented by resort to Article 19, it is necessary to interpret the phrase an employed or self-employed person in Article 19(1) as a concept limited to those who are in active employment or self-employment at or up to the time when the sickness giving rise to the claim occurs.

The appellant also claims that on an examination of the purposes of Articles 19 and 25, it may be said that they provide for different circumstances.

That is true, in his view, in respect of the first limb of Article 25(1) which, unlike Article 19(1), covers the case of someone who, following Article 69(1), goes for the purpose of seeking employment to another Member State which may be a Member State with which he has no previous connection, so that he could not be said to be resident there (within the definition of residence in Article 1(h], but only staying there (within the definition of stay in Article 1(i) of the regulation).

But even if the first limb of Article 25(1) may cater for someone who does not necessarily also come within Article 19(1), someone who satisfies the second limb of Article 25(1) (which is based on the second sentence of Article 71(1)(b)(ii) of the regulation) or Article 25(2) would appear at the same time, in the appellant's submission, to satisfy Article 19(1) if that article is held to cover the unemployed. Thus, if Article 19 applies to the unemployed, Article 25(1) would appear to cater for the same category of person at least in part.

The appellant considers that if the primary argument is not upheld, the interpretation proposed above would preserve consistency of approach as between sickness and maternity benefit on the one hand and unemployment benefit on the other.

The Chief Adjudication Officer further observes that it may be argued, in favour of Mrs Twomey, that a wider interpretation of Article 19 is necessary to give effect to the objects and purposes of Article 51 of the Treaty. Without such a wider interpretation, persons in Mrs Twomey's position might be discouraged from moving their places of residence and work to another Member State for fear that, in the event of sickness, their entitlement to benefits on returning to their original place of residence might be limited, even though they had contributed to the insurance scheme of their place of last employment. He points out in that connection that the Court tends towards a wide and liberal interpretation of Community legislation where it has been necessary to avoid penalizing migrant workers within the Community (see, inter alia, the judgment of 8 April 1976 in Case 48/75 Royer [1976] ECR 497; the judgment of 23 March 1982 in Case 53/81 Levin v Staatssecretaris van Justitie [1982] ECR 1035; and the judgment of 24 September 1987 in Case 43/86 Sociale Verzekeringsbank v de Rijke [1987] ECR 3611).

The Chief Adjudication Officer points out, however, that in relation to unemployment benefit, the ninth recital in the preamble to the regulation (in the original version) states :

It appears significant, in the appellant's view, that a limited period is mentioned only in connection with unemployment benefit.

Finally, the appellant observes that where freedom of movement is for the purpose of seeking work the regulation gives complementary entitlement to sickness benefits and secure mobility of labour; by means of Article 22 of the regulation benefit is available in other circumstances, namely where a person is staying in a Member State other than the competent State or where a person is authorized to return to the Member State of residence or to go for treatment to another Member State.

In conclusion, the Chief Adjudication Officer proposes that the Court's answer to the request for a preliminary ruling should be that in the circumstances set out in the question posed by the Commissioner a person's entitlement to sickness benefit is governed by Article 25 of Regulation No 1408/71 and not by Article 19 thereof.

In the Commissions view, it is necessary first to determine the identity of the competent institution and the competent State, concepts to which both Article 19 and Article 25 refer.

Article l(q) of the regulation provides that competent State means the Member State in whose territory the competent institution is situated and according to Article l(o) competent institution means, inter alia, the institution from which the person concerned is entitled or would be entitled to benefits if he [...] were resident in the territory of the Member State in which the institution is situated.

The Social Security Commissioner is proceeding on the assumption that, but for her absence from Great Britain, Mrs Twomey would be entitled to receive sickness benefit from the United Kingdom Department of Social Security. In the Commission's opinion, it therefore seems that for present purposes the competent institution is the Department of Social Security and the competent State the United Kingdom.

The Commission then considers that it is necessary to examine the meaning of the terms employed person (in Article 19) and unemployed person or totally unemployed person (in Article 25), as the claimant's entitlement to a sickness benefit would appear to depend on whether she is to be viewed as employed or unemployed.

The Commission argues that if Mrs Twomey is regarded as an employed person within the meaning of Article 19, then clearly she can receive sickness benefit from the United Kingdom Department of Social Security. She satisfies the conditions laid down in the legislation of the competent State for receipt of that benefit (apart from the condition as to residence in Great Britain) and she is residing in a Member State other than the United Kingdom.

If, on the other hand, the claimant's case can only be dealt with on the basis of Article 25 because she is to be regarded as an unemployed person, then she will not be able to receive the benefit. The Commission considers that Mrs Twomey is not a person to whom Article 69(1) of the regulation applies, as she does not appear to have moved to Ireland to look for work. She did not apparently register with the United Kingdom authorities as a person seeking work before her departure and she did not remain available to the employment services of the United Kingdom for four weeks before leaving for Ireland. The Commission adds that it appears from information which it has obtained that Mrs Twomey did register as a person seeking work with the employment services in Ireland.

In those circumstances, the claimant does not, in the Commission's opinion, meet the requirements of Article 69(1).

Nor, the Commission maintains, does Mrs Twomey come within any of the provisions of Article 71 mentioned in Article 25, as all of Article 71 is limited to unemployed persons who were formerly employed and who, during their last employment, were residing in a Member State other than the competent State, whereas the claimant was residing in the competent State during that period. The Commission considers that the question to be decided, therefore, is whether an unemployed person who was formerly employed but who does not satisfy the requirements of Article 25 may nevertheless benefit from the provisions of Regulation No 1408/71 due to the applicability of Article 19.

In that regard, the Commission agrees that Article 19 refers to employed persons but states that it is also clear that, for the purposes of the regulation, a person can be employed and unemployed at the same time, for the following reasons: Article 1(a)(i) defines the term employed person simply by reference to the circumstance of being insured for one or more of the contingencies covered by the branches of a social security scheme for employed persons; Article 26 refers to an employed person when it means to indicate a pensioner; Article 71(1)(b)(ii) speaks of an employed person ... who is wholly unemployed; and the Court itself clearly stated in its judgment in Pierik, cited above, that the term worker (formerly used in the regulation, before the expressions employed person and self-employed person were introduced by Council Regulation (EEC) No 1390/81 of 12 May 1981, Official Journal 1981 L 143, p. 1) applied also to inactive workers.

The Commission considers that the judgment in Pierik is an interesting precedent in relation to the present case, in that the Court there allowed a case concerning a pensioner to be dealt with under Article 22, which is part of Title III, Chapter 1, Section 2 of the regulation, concerning employed or self-employed persons. If the Court considered in Pierik that the person concerned, who was not covered by Article 31 in the section concerning pensioners, could have recourse to Article 22 concerning workers, then there is nothing to prevent the same approach being followed in relation to Mrs Twomey.

The Commission acknowledges, nevertheless, that it may seem strange that the framers of the regulation should have so carefully and restrictively constructed a specific article, namely Article 25, to cover certain categories of unemployed persons only to allow other unemployed persons who do not meet the conditions of Article 25 to benefit from Article 19. It may be asked why an unemployed person who satisfies the conditions laid down in Article 69(1), to which Article 25 refers, should be entitled to receive sickness benefit from the competent State, should he fall ill, for only three months after he left that State, whereas an unemployed person who goes to another Member State without satisfying those conditions may claim sickness benefit from the competent State without limit in point of time (save that the entitlement to the benefit will ultimately expire due to conditions imposed by national law).

In the Commission's view, the answer to that possible objection is twofold. In the first place, the concern of the authors of Article 25, as far as the references to Article 69(1) are concerned, was to establish a firm parallelism between the conditions under which an unemployed person who moves from one Member State to another in search of work can retain his entitlement to unemployment benefit from the competent State and the conditions under which such a person can receive sickness benefit should he fall ill before finding work. As is made clear by the last sentence of Article 25(1)(b), cash benefits in the nature of sickness benefit are seen as replacing unemployment benefit. In the Commission's view, it makes sense that an unemployed person who maintains his entitlement to unemployment benefit only if he returns to the competent State at the end of three months should be entitled to sickness benefit too, where appropriate, only for a period of three months.

Secondly, by no means all unemployed persons fall within the scope of Article 19. The Commission stresses that the unemployed persons covered by that article must reside in a Member State other than the competent State, the term residence being defined in Article 1(h) as habitual residence. Consequently, Article 19 is not an easy alternative to Article 25, since it excludes unemployed persons going temporarily to a Member State other than the competent State.

Thus, in the Commission's view, there is nothing to preclude an unemployed person who does not fall within one of the specific categories of unemployed persons referred to in Article 25 from being covered by Article 19 if he meets the requirements thereof.

The Commission further claims that if Article 19 were not considered to be applicable to a person in Mrs Twomey's circumstances, such a person would lose the benefit of the contributions he had made to the social security system in the competent State. Such a result, the Commission adds, would be contrary to the Court's case-law to the effect that acquired rights should be maintained.

In its judgment of 15 July 1964 in Case 100/63 Kalsbeek v Sociale Verzekeringsbank [1964] ECR 565, for example, the Court said:

Lastly, the Commission considers that Mrs Twomey cannot have lost her status as a worker only because she ceased to work for a time, and if she had not become ill it is quite possible that she would have begun to work in Ireland. In any event, in the Commission's view, there is no reason why she should lose a right she had acquired only because she moved from one Member State to another.

The Commission therefore proposes that the question of the Social Security Commissioner be answered as follows:

Article 19 of Council Regulation No 1408/71 of 14 June 1971, as amended, on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Communities must be interpreted as meaning that a national of a Member State who becomes unfit for work by reason of sickness while resident in one Member State, who prior to becoming so unfit was unemployed and who was last employed in another Member State where that person also then resided is entitled to sickness benefit payable by the competent institution of the latter Member State, assuming that all conditions, other than those relating to residence, of the legislation of the said Member State governing entitlement to such benefit are satisfied.

1 Language of the case: English.