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Mr Thiele Meneses, by R. Braun, Rechtsanwalt,

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the German Government, by T. Henze and J. Möller, acting as Agents,

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the Danish Government, by C. Thorning, acting as Agent,

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the Greek Government, by G. Papagianni, acting as Agent,

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the European Commission, by V. Kreuschitz and D. Roussanov, acting as Agents,

1

This request for a preliminary ruling concerns the interpretation of Articles 20 EC and 21 TFEU.

2

The request has been made in proceedings between Mr Thiele Meneses, a German national residing in Istanbul (Turkey), and the education and training grants unit of Region Hannover (Region of Hannover), regarding the refusal of an education grant for studies pursued in the Netherlands.

3

Under the heading ‘Education and training in Germany’, Paragraph 4 of the Federal Law on assistance for education and training (Bundesgesetz über individuelle Förderung der Ausbildung (Bundesausbildungsförderungsgesetz)) in the version published on 7 December 2010 (BGB1. I, p. 1952, the ‘BAföG’), provides:

‘Subject to Paragraphs 5 and 6, an education or training grant shall be awarded for education or training in Germany.’

4

Paragraph 5 of the BAföG, headed ‘Education and training abroad’, is worded as follows:

‘1.   The permanent residence within the meaning of the law is established at the location which is, not merely on a temporary basis, the centre of that person’s interests, but does not require an intention to settle there permanently; a person who resides at a location solely for the purposes of education or training has not established his permanent residence there.

2.   Students who have their permanent residence in Germany shall be awarded an education or training grant for attending an education or training establishment abroad if:

...

...’

5

Paragraph 6 of the BAföG, entitled ‘Education or training grants for German nationals abroad’ provides:

‘An education or training grant may be awarded to German nationals within the meaning of the Grundgesetz (Basic Law) who have their permanent residence in a foreign State, in which they attend an education or training establishment or from which they attend an education or training establishment in a neighbouring State, if the specific circumstances of the individual case justify such award. The nature and duration of the payments and the calculation of income and assets shall be based on the specific circumstances of the country of residence.’

6

Paragraph 16 of the BAföG, entitled ‘Duration of the grant for education or training abroad’ is worded as follows:

‘1.   For education or training abroad within the meaning of Paragraph 5(2)(1) or (5), the education or training grant shall be paid for a maximum period of one year.

...

3.   In the cases referred to in Paragraph 5(2)(2) and (2)(3), receipt of the education or training grant is not subject to the time limit laid down in Paragraph 5(1) and (2). However, as regards the cases referred to in Paragraph 5(2)(3), the grant shall be paid for more than one year only if, where the student commenced his residence abroad after 31 December 2007, he had been a permanent resident of Germany for a minimum of 3 years.’

7

Paragraph 6 of the BAföG is supplemented by administrative provisions relating to the BAföG (Allgemeine Verwaltungsvorschrift zum Bundesausbildungsförderungsgesetz) (the ‘BAföGVwV’), which provide that:

...

8

It is apparent from the order for reference that Mr Thiele Meneses, a German national born in Brazil in 1989, has his permanent residence in Istanbul, where his parents live.

9

The applicant in the main proceedings attended German schools in Istanbul from 2001 to 2004, in Barcelona from 2004 to 2007, and again in Istanbul from 2007 to 2009. In June 2009 he obtained the school leaving exam (‘Abitur’). He resided in South America from June 2009 to April 2010 where, inter alia, he completed a three month internship in Santiago (Chile). During the summer 2010 semester, he began studying law at the University of Würzburg (Germany).

10

During the winter semester 2010/11, Mr Thiele Meneses changed university and began studying law at the University of Maastricht (Netherlands), where he established another residence.

11

On 11 August 2010, the applicant in the main proceedings applied to Region Hannover for an education grant for his studies at the University of Maastricht.

12

By decision of 12 October 2010, Region Hannover dismissed that application on the ground that, for German nationals residing abroad, education and training grants may be awarded, in accordance with Paragraph 6 of the BAföG, only in specific circumstances. Those circumstances, according to Region Hannover, were not present in the case of the applicant in the main proceedings.

13

On 15 November 2010, Mr Thiele Meneses brought an action against that decision before the Verwaltungsgericht Hannover, in which he submitted that the refusal to award him an education grant infringed the right of freedom of movement conferred upon him by Articles 20 TFEU and 21 TFEU, since, as his place of residence was located in Turkey, and as the provisions of the BAföG provided for him to be awarded an education grant only if he pursued his studies in Germany, those provisions prevented him from making use of the fundamental freedoms provided for by the FEU Treaty.

14

The referring court is unsure whether national provisions such as Paragraphs 5 and 6 of the BAföG are compatible with Articles 20 TFEU and 21 TFEU. According to that court, by restricting the award of grants for education and training abroad to only those German nationals who reside in Germany, those provisions place at a disadvantage a specific group of citizens of the European Union who, before starting their studies, are permanently resident in a Member State of the European Union other than the Federal Republic of Germany. Point 3 of the first sentence of Paragraph 5(2) of the BAföG is liable to deter a German national who has a permanent residence outside of Germany, but not necessarily in the European Union, from going to live in a Member State other than the Federal Republic of Germany to start or continue his studies.

15

According to the referring court, that disadvantage is only partly compensated by the supplementary rule contained in Paragraph 6 of the BAföG because that provision does not cover all courses of study in all Member States of the European Union, but is on the contrary restricted to the applicant’s State of residence and his neighbouring States. In addition, Paragraph 6 of the BAföG does not give rise to any rights to a grant since the grant is awarded only in specific circumstances and in accordance with Region Hannover’s assessment. Paragraph 6 of the BAföG is therefore also liable to deter a citizen of the European Union who has his permanent residence abroad from going to live in the Member State of his choice in order to start or continue his studies.

16

In the light of those considerations, the Verwaltungsgericht Hannover decided to stay proceedings and to refer the following question to the Court for a preliminary ruling:

‘Does the right to freedom of movement and freedom of residence conferred on a Union citizen by Articles 20 and 21 TFEU preclude a regulatory system in national law under which German nationals with a permanent residence outside the Federal Republic of Germany may be awarded an education grant to attend an education establishment situated in a Member State of the European Union only if the education establishment is either in the country of permanent residence or in a neighbouring state of that country and, moreover, special circumstances of the individual case justify the grant?’

17

By its question, the referring court asks, in essence, whether Articles 20 TFEU and 21 TFEU must be interpreted as precluding national legislation, such as that at issue in the case in the main proceedings, which, as a rule, makes the award of an education or training grant for studies pursued in another Member State subject to the sole condition of having established a permanent residence, within the meaning of that legislation, on national territory and which, in the case where the applicant is a national of that State with no permanent residence within that State, provides for a grant for education or training abroad only in the applicant’s State of residence or in a neighbouring State thereof and only where specific circumstances justify such a grant.

18

First of all, it must be recalled that, as a German national, Mr Thiele Meneses enjoys the status of a citizen of the Union under Article 20(1) TFEU and may therefore rely on the rights conferred on those having that status, including against his Member State of origin (see, Case C-192/05 Tas-Hagen and Tas [2006] ECR I-10451, paragraph 19; Joined Cases C-11/06 and C-12/06 Morgan and Bucher [2007] ECR I-9161, paragraph 22; and Joined Cases C-523/11 and C-585/11 Prinz and Seeberger [2013] ECR, paragraph 23 and the case-law cited).

19

As the Court has held on numerous occasions, the status of citizen of the Union is destined to be the fundamental status of nationals of the Member States, enabling those among such nationals who find themselves in the same situation to enjoy as regards the material scope of the FEU Treaty the same treatment in law irrespective of their nationality, subject to such exceptions as are expressly provided for in that regard (Case C-224/98 D’Hoop [2002] ECR I-6191, paragraph 28; Case C‑46/12 N. [2013] ECR, paragraph 27; and Prinz and Seeberger, paragraph 24 and the case-law cited).

20

The situations falling within the scope of EU law include those involving the exercise of the fundamental freedoms guaranteed by the Treaty, in particular those involving the freedom to move and reside within the territory of the Member States, as conferred by Article 21 TFEU (Morgan and Bucher, paragraph 23, and Prinz and Seeberger, paragraph 25 and the case-law cited).

21

In that respect, although the Member States are competent, under Article 165(1) TFEU, as regards the content of teaching and the organisation of their respective education systems, they must exercise that competence in compliance with EU law and, in particular, in compliance with the Treaty provisions on the freedom to move and reside within the territory of the Member States, as conferred by Article 21(1) TFEU on all citizens of the European Union (see, Morgan and Bucher, paragraph 24, and Prinz and Seeberger, paragraph 26 and the case-law cited).

22

Next, it should be recalled that national legislation which places at a disadvantage certain of the nationals of the Member State concerned simply because they have exercised their freedom to move and to reside in another Member State constitutes a restriction on the freedoms conferred by Article 21(1) TFEU on every citizen of the Union (Case C-406/04 De Cuyper [2006] ECR I-6947, paragraph 39, Morgan and Bucher, paragraph 25, and Prinz and Seeberger, paragraph 27).

23

Indeed, the opportunities offered by the Treaty in relation to freedom of movement for citizens of the Union cannot be fully effective if a national of a Member State can be deterred from availing himself of them because of obstacles placed in the way of his stay in another Member State by legislation of his State of origin penalising the mere fact that he has used those opportunities (see, to that effect, D’Hoop, paragraph 31; Case C-224/02 Pusa [2004] ECR I-5763, paragraph 19; Morgan and Bucher, paragraph 26; and Prinz and Seeberger, paragraph 28).

24

That consideration is particularly important in the field of education in view of the aims pursued by Article 6(e) TFEU and the second indent of Article 165(2) TFEU, namely, inter alia, encouraging mobility of students and teachers (see D’Hoop, paragraph 32; Case C-147/03 Commission v Austria [2005] ECR I-5969, paragraph 44; Morgan and Bucher, paragraph 27; and Prinz and Seeberger, paragraph 29).

25

In that regard, it must be noted that EU law does not impose any obligation on the Member State to provide a system of education or training grants for studies in another Member State. However, where a Member State provides for a system of education or training grants which enables students to receive such grants, it must ensure that the detailed rules for the award of those grants do not create an unjustified restriction of the right to move and reside within the territory of the Member States (see Morgan and Bucher, paragraph 28, and Prinz and Seeberger, paragraph 30).

26

In the present case, it is not disputed that the applicant in the main proceedings, who always retained his permanent residence, within the meaning of the BAföG, in Turkey, started his law studies in Germany and, after one semester, changed university to pursue his studies in the Netherlands. It is also apparent from the file that the applicant wanted to study neither in Turkey, nor in a neighbouring State and that according to Region Hannover’s assessment, no personal circumstances justified the award of an education or training grant abroad.

27

It must be held that a condition of permanent residence, like that laid down in Article 5(2) of the BAföG, even though it applies without distinction to German nationals and other citizens of the European Union, constitutes a restriction on the right to freedom of movement and residence enjoyed by all citizens of the Union pursuant to Article 21 TFEU (see, to that effect, Prinz and Seeberger, paragraph 31). The existence of that restriction is not affected by the fact that the legislation at issue in the main proceedings, at Paragraph 6 of the BAföG, provides for the possibility for nationals to derogate from that condition in specific circumstances which are clearly delimited, thus failing to ensure that those nationals have full enjoyment of their right to freedom of movement and residence.

28

Such legislation is thus likely to dissuade European Union nationals from exercising their right to freedom of movement and residence in another Member State, given the impact that exercising that freedom is likely to have on the right to the education or training grant (Prinz and Seeberger, paragraph 32).

29

The restriction flowing from the legislation at issue in the main proceedings can be justified in the light of EU law only if it is based on objective considerations of public interest independent of the nationality of the persons concerned and if it is proportionate to the legitimate objective pursued by the provisions of national law (see De Cuyper, paragraph 40; Morgan and Bucher, paragraph 33; and Prinz and Seeberger, paragraph 33). It follows from the case-law of the Court that a measure is proportionate if, while appropriate for securing the attainment of the objective pursued, it does not go beyond what is necessary in order to attain that objective (De Cuyper, paragraph 42; Morgan and Bucher, paragraph 33; and Prinz and Seeberger, paragraph 33).

30

It is in the light of the requirements of the case-law recalled in the previous paragraph that the arguments submitted to the Court seeking to justify the restriction referred to in paragraph 27 of the present judgment should be examined.

31

According to the German Government, if they do impose a restriction on the freedom of movement and residence, the provisions of the BAföG are justified by objective considerations of public interest. In that regard, a German national, whether he lives in Germany or abroad, is directed first, in relation to education and training grants under the BAföG, to studies in Germany. Thus, according to that government, the national legislation makes it possible only exceptionally to finance studies outside of the Federal Republic of Germany in the case where it is not reasonable to contemplate pursuing studies in that Member State and only in the applicant’s State of residence or in a neighbouring State thereof. The exception provided for at Paragraph 6 of the BAföG therefore has limited effect; its purpose is not to create a general scheme to finance the studies of German nationals who have their permanent residence abroad. In addition, the German Government notes that a connection with the national territory remains a prerequisite to the award of a grant under the BAföG.

32

The German Government thus asserts that the national legislation may be explained by three objectives: an objective seeking to ensure a minimum level of integration of the applicant for the grant in the awarding State, an economic objective seeking to prevent an excessive burden and to maintain the national framework of exportable education and training grants and an objective seeking to promote student cross-border mobility.

33

First of all, the government submits that the regulatory framework of the BAföG seeks to ensure a minimum level of integration of the applicant for the grant in the awarding State.

34

In that regard, it must be noted that both the integration of students and the wish to establish that there is a connection between the society of the Member State concerned and the recipient of a benefit such as that at issue in the main proceedings can constitute objective considerations of public interest which are capable of justifying the fact that the conditions for the grant of the benefit may affect the freedom of movement of the citizens of the Union (see, by analogy, D’Hoop, paragraph 38; Tas‑Hagen and Tas, paragraph 35; Case C-499/06 Nerkowska [2008] ECR I-3993, paragraph 37; and Case C-103/08 Gottwald [2009] ECR I-9117, paragraph 32).

35

The Court has recognised that it may be legitimate for a Member State, in order to ensure that the grant of assistance to cover the maintenance costs of students from other Member States does not become an unreasonable burden which could have consequences for the overall level of assistance which may be granted by that State, to grant such assistance only to students who have demonstrated a certain degree of integration into the society of that State, and if a risk exists of such an unreasonable burden, theoretically, similar considerations may apply as regards the award by a Member State of education or training grants to students wishing to study in other Member States (Case C-209/03 Bidar [2005] ECR I-2119, paragraphs 56 and 57; Morgan and Bucher, paragraphs 43 and 44; and Prinz and Seeberger, paragraph 36).

36

However, according to settled case-law, the proof required to demonstrate the genuine link must not be too exclusive in nature or unduly favour one element which is not necessarily representative of the real and effective degree of connection between the claimant and the Member State, to the exclusion of all other representative elements (see, to that effect, D’Hoop, paragraph 39; Case C-503/09 Stewart [2011] ECR I-6497, paragraph 95; Case C‑75/11 Commission v Austria [2012] ECR, paragraph 62; Case C‑20/12 Giersch and Others [2013] ECR, paragraph 76; and Prinz and Seeberger, paragraph 37).

37

In relation to the extent to which the recipient of a benefit is connected with the society of the Member State concerned, the Court has held that, with regard to benefits that are not governed by EU law, such as those at issue in the main proceedings, Member States enjoy a broad discretion in deciding which criteria are to be used when assessing the extent of that connection (see, to that effect, Tas-Hagen and Tas, paragraph 36, and Gottwald, paragraph 34).

38

In that regard, the Court has already held that a sole condition of permanent residence, such as that at issue in the case in the main proceedings, risks excluding from the funding in question students who, despite not having resided in Germany for an uninterrupted period of three years immediately prior to studying abroad, are nevertheless sufficiently connected to German society. That may be the case where the student is a national of the Member State concerned and was educated there for a significant period or on account of other factors such as, in particular, his family, employment, language skills or the existence of other social and economic factors (see, to that effect, Prinz and Seeberger, paragraph 38).

39

In the present case, Paragraph 6 of the BAföG makes it possible for German nationals who have their permanent residence abroad to derogate from the condition of uninterrupted residence of three years in Germany. None the less, the German Government stated, in its observations submitted to the Court and during the hearing, that the derogation provided for at Paragraph 6 of the BAföG is interpreted restrictively and is of an exceptional nature. In that regard, it states that Paragraph 6, which is completed by the BAföGVwV, applies only to situations where the applicants for an education or training grant are unable to carry out their studies in Germany. The BAföGVwV concern, inter alia, the applicant’s illness or disability or the illness or disability of the applicant’s parents or family members who require care, and other reasons connected with the equivalence of studies or to the financial situation of the applicant’s parents.

40

It thus appears that the application of those derogations does not depend at all on the existence of factors connecting the applicant for the grant and German society. They cannot therefore ensure that the objective of integration pleaded by the German Government is achieved. In those circumstances, the condition of permanent residence at issue in the main proceedings remains at the same time too exclusive and too arbitrary in that it unduly favours an element which is not necessarily representative of the degree of integration in the society of the Member State at the time of the application for the grant. Accordingly, the national legislation at issue in the main proceedings cannot be considered proportionate to the objective of integration.

41

It is therefore for the referring court, which has sole jurisdiction to assess the facts, to consider the possible factors connecting the applicant in the main proceedings and the Federal Republic of Germany, inasmuch as Mr Thiele Meneses, a German national born in Brazil, has never resided in Germany, although he received his schooling in German schools in Spain and in Turkey.

42

Secondly, the German Government submits that the objective of the BAföG provisions at issue is to prevent the awarding State from incurring an unreasonable burden, which ensures that the national scheme of exportable education and training grants is maintained. According to that government, preventing an unreasonable burden and maintaining the national framework of exportable education and training grants are objectives of public interest, capable of justifying a restriction of the fundamental freedoms conferred by Articles 20 TFEU and 21 TFEU.

43

In that regard, it should be borne in mind that while budgetary considerations may underlie a Member State’s choice of social policy and influence the nature or scope of the social protection measures which it wishes to adopt, they do not in themselves constitute an aim pursued by that policy (see, to that effect, Case C-187/00 Kutz-Bauer [2003] ECR I-2741, paragraph 59, and Case C-196/02 Nikoloudi [2005] ECR I-1789, paragraph 53). Reasons of a purely economic nature cannot constitute overriding reasons in the public interest justifying a restriction of a fundamental freedom guaranteed by the Treaty (see, by analogy, Case C-109/04 Kranemann [2005] ECR I-2421, paragraph 34 and the case-law cited, and Case C-384/08 Attanasio Group [2010] ECR I-2055, paragraph 55).

44

It follows that the purely financial objective put forward by the German Government cannot be regarded as an overriding reason in the public interest capable of objectively justifying the legislation at issue.

45

In addition, the German Government also submitted during the hearing that the financial objective is intended also to support the integration objective, and thus tends to ensure that only applicants for the grant who establish a sufficient link with the awarding State are awarded an education or training grant. That objective thus pursues another objective which is not financial and could justify a restriction on the fundamental freedoms.

46

The Court has already found at paragraph 40 of the present judgment that, in any event, the condition of permanent residence, despite the limited derogations thereto, is at the same time too general and too exclusive in nature. That restriction on the right to freedom of movement and of residence may therefore not be considered to be proportionate to the financial objective pursued as the German Government claims it is.

47

Thirdly, according to the German Government, the purpose of the national legislation is to promote mobility in the field of education and training. The legislation at issue in the case in the main proceedings thus encourages students inclined to study only in Germany to study abroad and the national labour market benefits from that mobility since, in view of the recipient’s permanent residence in Germany, a return to the awarding State is usual. On the other hand, an applicant for a grant residing abroad and who wants to study in another language in another Member State is not encouraged to join the German labour market. Therefore the measures envisaged by the BAföG enable that objective to be achieved and do not go beyond what is necessary to achieve it.

48

In that regard, the Court has already held that the objective of encouraging student mobility is in the public interest and that it is one of the actions which Article 165 TFEU assigns to the European Union in the context of educational policy, vocational training, youth and sport, and that mobility in education and training is an integral part of freedom of movement for persons and that it is one of the main objectives of the European Union’s action (see Case C‑542/09 Commission v Netherlands [2012] ECR, paragraph 71).

49

In that context, a justification relating to the promotion of student mobility could constitute an overriding reason in the public interest such as to justify a restriction of the sort at issue in the present case. None the less, as mentioned at paragraph 29 of the present judgment, legislation which is liable to restrict a fundamental freedom guaranteed by the Treaty, such as the right to freedom of movement and residence for citizens of the European Union, can be justified only if it is appropriate for securing the attainment of the legitimate objective pursued and if it does not go beyond what is necessary in order to attain it (see Commission v Netherlands, paragraph 73).

50

In any event, the Court has already held, at paragraph 40 of the present judgment, that legislation such as that at issue in the main proceedings is at the same time too general and too exclusive and cannot be considered proportionate since it prioritises an element which is not necessarily the only element representative of the actual degree of connection between the applicant for the grant and German society (see, to that effect, Commission v Netherlands, paragraph 86).

51

In view of the foregoing, the answer to the question referred is that Articles 20 TFEU and 21 TFEU must be interpreted as precluding legislation of a Member State, such as that at issue in the main proceedings, which, as a rule, makes the award of an education or training grant for studies pursued in another Member State subject to the sole condition of having established a permanent residence, within the meaning of that legislation, on national territory and which, in a case where the applicant is a national of that State with no permanent residence within that State, provides for a grant for education or training abroad only in the applicant’s State of residence or in a neighbouring State thereof and only where specific circumstances justify such a grant.

52

Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

On those grounds, the Court (Third Chamber) hereby rules:

Articles 20 TFEU and 21 TFEU must be interpreted as precluding legislation of a Member State, such as that at issue in the main proceedings, which, as a rule, makes the award of an education or training grant for studies pursued in another Member State subject to the sole condition of having established a permanent residence, within the meaning of that legislation, on national territory and which, in a case where the applicant is a national of that State with no permanent residence within that State, provides for a grant for education or training abroad only in the applicant’s State of residence or in a neighbouring State thereof and only where specific circumstances justify such a grant.