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Document 62003CC0286

Opinion of Advocate General Kokott delivered on 20 October 2005.
Silvia Hosse v Land Salzburg.
Reference for a preliminary ruling: Oberster Gerichtshof - Austria.
Social security for migrant workers - Regulation (EEC) No 1408/71 - Article 4(2b) - Special non-contributory benefits - Austrian benefit intended to cover the risk of reliance on care - Classification of the benefit and lawfulness of the residence condition from the point of view of Regulation No 1408/71 - Dependant of the insured person.
Case C-286/03.

European Court Reports 2006 I-01771

ECLI identifier: ECLI:EU:C:2005:621

OPINION OF ADVOCATE GENERAL

KOKOTT

delivered on 20 October 2005 (1)

Case C-286/03

Silvia Hosse

v

Land Salzburg

(Reference for a preliminary ruling from the Oberster Gerichtshof, Austria)

(Social security for migrant workers – Benefits in respect of reliance on care – Care allowance under the Salzburg Pflegegeldgesetz – Lawfulness of a residence requirement under Regulation (EEC) No 1408/71 – Social advantage within the meaning of Regulation (EEC) No 1612/68 – Citizenship of the Union)





I –  Introduction

1.        This reference for a preliminary ruling seeks to establish whether payment of care allowance under the Pflegegeldgesetz (Law on care allowance) of the Province of Salzburg (Austria) may be made subject to the condition that the recipient is resident in Austria. Specifically, it concerns possible entitlements on the part of the severely disabled daughter of a frontier worker who lives with his family in Germany and works in Austria.

2.        Provincial care allowance is granted to persons reliant on care who are not entitled to care allowance under the Bundespflegegeldgesetz (Federal Law on care allowance). In Jauch (2) the Court has already ruled that federal care allowance is a social security sickness benefit, the grant of which may not be made subject to a residence requirement, under Regulation No 1408/71. (3) Because of certain differences in the way the benefit is financed and in the class of beneficiaries, provincial care allowance – unlike federal care allowance – could possibly be classifiable as a special non-contributory benefit which, because of its proximity to social assistance, need be paid only to persons resident in Austria.

3.        The reference also raises the question whether care allowance constitutes a social advantage within the meaning of Regulation No 1612/68 (4) to which a relative of a migrant worker is entitled even if she does not live in the migrant worker’s place of employment.

4.        Lastly, the referring court also asks whether the principles of citizenship of the Union preclude the imposition of a residence requirement as a condition for receipt of the benefit.

II –  Facts and procedure

5.        German national Sven Hosse works as a teacher in the Province of Salzburg. He is required to pay tax and social insurance in Austria, where he also enjoys sickness insurance cover. He lives with his wife and his severely physically disabled daughter, Silvia Hosse, who was born in 1997, in Germany close to the Austrian border. The members of his family are also German nationals.

6.        Silvia Hosse’s mother previously worked in Germany and, as a result, was in the German care insurance system up to September 2000, when her period of parental leave ended. Her daughter received German care allowance as a relative. Payment of that cash benefit ceased, however, after the end of the period of parental leave, because her mother did not start working again.

7.        Thereupon, on 7 December 2000, an application for care allowance was made to the Province of Salzburg for Silvia Hosse. This was intended to supplement the benefits in kind which she received, as a dependent of her father, from the competent Austrian sickness insurance institution. However, the province rejected that application on the ground that in order to be granted care allowance the person reliant on care had to reside principally in the Province of Salzburg.

8.        The action brought against that decision was unsuccessful at first instance. However, the appellate court allowed Silvia Hosse’s appeal with reference to the judgment in Jauch. By an order of 27 May 2003, the Oberster Gerichtshof (Supreme Court), which is hearing an appeal on a point of law against that decision, referred the following questions to the Court of Justice pursuant to Article 234 EC for a preliminary ruling:

1.      Is Article 4(2b) 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 amended by Regulation (EEC) No 1247/92, in conjunction with Annex II, Section III, to be interpreted as meaning that care allowance under the Salzburger Pflegegeldgesetz (Law on Care Allowance of the Province of Salzburg) awarded to a member of the family of a person employed in the Province of Salzburg who lives with his family in the Federal Republic of Germany is excluded from the scope of Regulation (EEC) No 1408/71 as a special non-contributory benefit?

2.      If the answer to Question 1 is in the negative:

May the member of the family of a person employed in the Province of Salzburg who lives with his family in the Federal Republic of Germany claim payment of care allowance under the Salzburger Pflegegeldgesetz as a sickness benefit in cash in accordance with Article 19 and the corresponding provisions of the other sections of Chapter 1 of Title III of Regulation (EEC) No 1408/71, irrespective of the fact that his main residence is in the Federal Republic of Germany, if he satisfies the other conditions for receipt of the benefit?

3.      If the answer to Question 1 is in the affirmative:

Can a benefit such as care allowance under the Salzburger Pflegegeldgesetz, as a social advantage within the meaning of Article 7(2) of Regulation (EEC) No 1612/68 of the Council of 15 October 1968 on freedom of movement for workers within the Community, be made subject to the condition that the recipient has his main residence in the Province of Salzburg?

4.      If the answer to Question 3 is in the affirmative:

Is the fact that citizens of the Union who work as frontier workers in the Province of Salzburg but have their main residence in another Member State are not entitled to claim a social advantage within the meaning of Article 7(2) of Regulation (EEC) No 1612/68, such as care allowance under the Salzburger Pflegegeldgesetz, compatible with Community law, in particular with the principles of citizenship of the Union and non‑discrimination under Articles 12 EC and 17 EC?

If not: Does citizenship of the Union make it possible also for dependent family members of such a frontier worker who likewise have their main residence in another Member State to receive care allowance under the Salzburger Pflegegeldgesetz in the Province of Salzburg?

9.        In the proceedings before the Court of Justice observations have been submitted by the Province of Salzburg, the Netherlands, Austrian, Portuguese, Finnish and United Kingdom Governments, and the Commission of the European Communities.

III –  Legal framework

A –    Community law

10.      Article 7(1) and (2) of Regulation No 1612/68 state:

‘1.      A worker who is a national of a Member State may not, in the territory of another Member State, be treated differently from national workers by reason of his nationality in respect of any conditions of employment and work, in particular as regards remuneration, dismissal, and should he become unemployed, reinstatement or re-employment.

2.      He shall enjoy the same social and tax advantages as national workers.’

11.      Article 1 of Regulation No 1408/71 provides:

‘For the purpose of this Regulation:

(b)      frontier worker means any employed or self-employed person who pursues his occupation in the territory of a Member State and resides in the territory of another Member State to which he returns as a rule daily or at least once a week; …’

12.      Article 2 of Regulation No 1408/71, (5) which defines the persons covered, provides, in paragraph 1:

‘This Regulation shall apply to employed or self-employed persons and to students who are or have been subject to the legislation of one or more Member States and who are nationals of one of the Member States … as well as to the members of their families and their survivors.’

13.      Article 3(1) of Regulation No 1408/71, ‘Equality of treatment’, states:

‘Subject to the special provisions of this Regulation, persons resident in the territory of one of the Member States to whom this Regulation applies shall be subject to the same obligations and enjoy the same benefits under the legislation of any Member State as the nationals of the State.’

14.      Article 4 of Regulation No 1408/71, ‘Matters covered’, provides:

‘1.      This Regulation shall apply to all legislation concerning the following branches of social security:

(a)      sickness and maternity benefits;

(b)      invalidity benefits, including those intended for the maintenance or improvement of earning capacity;

2.      This Regulation shall apply to all general and special social security schemes, whether contributory or non-contributory, and to schemes concerning the liability of an employer or shipowner in respect of the benefits referred to in paragraph 1.

2a.      This Regulation shall also apply to special non-contributory benefits which are provided under a legislation or schemes other than those referred to in paragraph 1 or excluded by virtue of paragraph 4, where such benefits are intended:

(a)      either to provide supplementary, substitute or ancillary cover against the risks covered by the branches of social security referred to in paragraph 1(a) to (h);

or

(b)      solely as specific protection for the disabled.

2b.      This Regulation shall not apply to the provisions in the legislation of a Member State concerning special non-contributory benefits, referred to in Annex II, Section III, the validity of which is confined to part of its territory.

4.      This Regulation shall not apply to social and medical assistance. ....’

15.      With regard to special non-contributory benefits under Article 4(2a), Article 10a(1) of Regulation No 1408/71 provides as follows:

‘Notwithstanding the provisions of Article 10 and Title III, persons to whom this Regulation applies shall be granted the special non-contributory cash benefits referred to in Article 4(2a) exclusively in the territory of the Member State in which they reside, in accordance with the legislation of that State, provided that such benefits are listed in Annex IIa. Such benefits shall be granted by and at the expense of the institution of the place of residence.’

16.      Article 19 of Regulation No 1408/71 provides with respect to sickness and maternity benefits:

‘1.      An employed or self-employed person residing in the territory of a Member State other than the competent State, who satisfies the conditions of the legislation of the competent State for entitlement to benefits … shall receive in the State in which he is resident:

(a)      benefits in kind provided on behalf of the competent institution by the institution of the place of residence in accordance with the provisions of the legislation administered by that institution as though he were insured with it;

(b)      cash benefits provided by the competent institution in accordance with the legislation which it administers. However, by agreement between the competent institution and the institution of the place of residence, such benefits may be provided by the latter institution on behalf of the former, in accordance with the legislation of the competent State.

2.      The provisions of paragraph 1 shall apply by analogy to members of the family who reside in the territory of a Member State other than the competent State in so far as they are not entitled to such benefits under the legislation of the State in whose territory they reside.

…’

17.      Annex II, Section III, letter K (6) lists for Austria the benefits granted under Bundesländer legislation for disabled persons and persons in need of care as special non-contributory benefits within the meaning of Article 4(2b) which do not fall within the scope of the regulation.

18.      With effect from 5 May 2005 (7) Article 4(2a) of Regulation No 1408/71 was amended as follows:

‘This Article shall apply to special non-contributory cash benefits which are provided under legislation which, because of its personal scope, objectives and/or conditions for entitlement, has characteristics both of the social security legislation referred to in paragraph 1 and of social assistance.

‘Special non-contributory cash benefits’ means those:

(a)      which are intended to provide either:

(i)      supplementary, substitute or ancillary cover against the risks covered by the branches of social security referred to in paragraph 1, and which guarantee the persons concerned a minimum subsistence income having regard to the economic and social situation in the Member State concerned,

or

(ii)      solely specific protection for the disabled, closely linked to the said person’s social environment in the Member State concerned,

and

(b)      where the financing exclusively derives from compulsory taxation intended to cover general public expenditure and the conditions for providing and for calculating the benefits are not dependent on any contribution in respect of the beneficiary. However, benefits provided to supplement a contributory benefit shall not be considered to be contributory benefits for this reason alone;

and

(c)      which are listed in Annex IIa.’

B –    National law

19.      Comprehensive new rules on care provision which were more or less uniform throughout Austria came into force in 1993. The basis for the reform is the Agreement between the Federation and the Provinces on joint measures for persons reliant on care. (8) Article 1 (Care provision throughout Austria) states:

‘(1) The Contracting Parties agree, on the basis of Austria’s federal structure, to regulate provision for persons reliant on care throughout Austria in accordance with identical aims and principles.

(2) The Contracting Parties undertake to create, within the areas of competence allocated to them by constitutional law, a comprehensive care benefit system consisting of cash benefits and benefits in kind.

(4) Under identical conditions identical benefits shall be guaranteed as a minimum standard.’

20.      Under that Agreement, the federation and the provinces have each adopted laws on care allowance for the classes of persons falling within their competence, under which a uniformly structured care allowance graded according to need is granted.

21.      The Bundespflegegeldgesetz (BPGG) (9) applies to persons who have a right under federal law to a pension, annuity or similar benefits. The provincial laws on care allowance apply to persons who are not in receipt of pensions or annuities under federal law, in particular relatives of insured persons, recipients of social assistance, disabled workers, and recipients of provincial and municipal pensions.

22.      Under Paragraph 1 of the Salzburg Pflegegeldgesetz (SPGG), (10) just as under Paragraph 1 of the BPGG, care allowance is designed to compensate in lump-sum form for the additional expenditure on care, so as to ensure as far as possible that persons reliant on care receive the necessary care and assistance and to improve their opportunity of leading an independent life in accordance with their needs. There is a legal right to the grant of provincial and federal care allowance.

23.      Under Paragraph 3(1) of the SPGG, persons reliant on care are entitled to care allowance provided that they

1.      possess Austrian nationality;

2.      have their main residence in the Province of Salzburg and

3.      are not in receipt of and are not entitled to any of the benefits mentioned in Paragraph 3 of the Bundespflegegeldgesetz (BPGG).

Nationals of European Community Member States are to be treated the same as Austrian nationals under Paragraph 3(4)(a) of the SPGG. Under Paragraph 3(6)(1) of the SPGG, legitimate minors are considered to share the main residence of their parents.

24.      In its capacity as the institution responsible for social assistance the province is, pursuant to Paragraph 17(1) of the SPGG, the entity responsible for carrying out the functions under the SPGG. The costs for care allowance are shared by the province and the municipalities under the Sozialhilfegesetz (Law on Social Assistance).

25.      The amount of care allowance is determined according to the need for care, primarily according to the time needed for care in hours per month; it can range from EUR 145.40 to EUR 1 531.50 per month. Detailed rules applying to the assessment of the need for care are laid down in a grading regulation. Any other income received by the person reliant on care has no bearing on the amount of care allowance received.

IV –  Legal assessment

A –    The first question – Classification of the benefit as a special non-contributory benefit within the meaning of Regulation No 1408/71

26.      By this question the referring court is seeking an interpretation of Article 4(2b) of Regulation No 1408/71 in order to ascertain whether under that provision the Salzburg care allowance is excluded from the material scope of the regulation. If Regulation No 1408/71 were not applicable, Silvia Hosse would not be able to rely on Article 19(1)(b) in conjunction with Article 19(2). Under that provision, the competent institution, in this case the Province of Salzburg, would have to provide cash benefits for the members of the family of an employed person at their place of residence.

1.      Legal effects of inclusion in Annex II, Section III of Regulation No 1408/71

27.      Under Article 4(2b), Regulation No 1408/71 does not apply to the provisions in the legislation of a Member State which concern the special non-contributory benefits referred to in Annex II, Section III, the validity of which is confined to part of its territory. Annex II, Section III, letter K mentions for Austria the benefits granted under provincial legislation for disabled persons and persons in need of care. Those benefits include care allowance under the provincial laws on care allowance.

28.      As the Court held in Jauch, however, it is not sufficient for classification as a special non-contributory benefit for the benefit in question to be listed in Annex IIa, which applied at that time. The substantive conditions for the existence of a special non-contributory benefit under Article 4(2a) of Regulation No 1408/71 must also be satisfied. (11)

29.      The Court bases this finding on the obligation to interpret Regulation No 1408/71 in the light of the provisions of the Treaty on freedom of movement for workers. (12) In particular, Article 42 EC, which forms the legal basis for Regulation No 1408/71, aims to establish the greatest possible freedom of movement for migrant workers. The aims of Article 39 EC et seq. would not be attained if, as a consequence of the exercise of their right to freedom of movement, workers were to lose their entitlement to social security benefits. On this basis, the Court concludes that provisions which lay down exceptions from the exportability of social security benefits – at that time Article 4(2a) in conjunction with Article 10a of Regulation No 1408/71 – must be interpreted strictly. (13)

30.      This principle of interpretation must apply all the more where the effect of a derogating provision, such as Article 4(2b) of Regulation No 1408/71 in the present case, is actually that the regulation as a whole is inapplicable. (14) Consequently, in addition to the mention of a benefit in Annex II, Section III of the regulation, the following substantive requirements must be cumulatively satisfied in order for a benefit to be excluded from the scope of the regulation under Article 4(2b):

–        the benefit stems from legislation the validity of which is confined to part of the territory of a Member State,

–        the benefit is granted on a non-contributory basis and

–        has the character of a special benefit.

2.      A benefit on the basis of regionally applicable legislation

31.      The rules governing the care allowance at issue are laid down in the SPGG, a law that applies only in the Province of Salzburg. However, the SPGG forms part of the overall system of care benefits, the introduction of which was agreed by the federation and the provinces in the Agreement on joint measures for persons reliant on care. (15) It is therefore doubtful whether it is possible to adopt the formal position that the SPGG applies only in the Province of Salzburg with respect to the application of the derogation in Article 4(2b) of Regulation No 1408/71.

32.      In the recitals in the preamble to Regulation No 1247/92, by which Article 4(2a) and (2b) of Regulation No 1408/71 were introduced, there are explanations why special rules are needed for the category of special non-contributory benefits. (16) However, no particular reasons are given for excluding special non-contributory benefits which are based on regionally applicable rules from the scope of the regulation.

33.      Nevertheless, Article 4(2b) can be explained by the fact that the legislature wished only to coordinate the general social security schemes (including special non-contributory benefits) which guarantee uniform basic protection throughout the Member State. From the outset the regulation was not intended to cover ancillary special non-contributory benefits which apply only regionally and supplement the general benefits.

34.      Substantively, however, provincial care allowance does not constitute a supplementary benefit that applies only regionally. The benefit forms part of the system to cover the risk of reliance on care which has been set up under uniform rules throughout the Member State of Austria. This system is based on the agreement between the federation and the provinces and a network of coordinated federal and provincial laws.

35.      The division of powers for the adoption of the laws on care allowance stems from Austria’s federal structure. Such internal divisions of powers cannot mean, however, that benefits under Article 4(2b) of Regulation No 1408/71 drop out of the scope of the regulation, even though they are granted identically to all residents of the Member State, albeit on the basis of rules whose application is limited geographically or personally. Otherwise the Member States would be able in this way to withdraw certain benefits from the scope of the regulation.

36.      Furthermore, it should be borne in mind that Article 4(2b) of Regulation No 1408/71 must be interpreted strictly. (17) Consequently, the assessment cannot be based solely on the formal criterion that a benefit is granted on the basis of the legislation of a province, region or municipality. Rather, there must also be, on a substantive level, a benefit existing in this form only in part of the Member State which was introduced on the basis of an autonomous decision by the relevant regional or local authority or authorities, which could also abolish it again.

37.      This is not the case with care allowance under the SPGG, since the Province of Salzburg is bound by the requirements laid down in the Agreement between the Federation and the Provinces. For this reason alone it does not fall within the scope of Article 4(2b) of Regulation No 1408/71. Consequently, it was wrongly included in Annex II, Section III of the regulation, like the relevant provisions of the other provinces.

3.      Special non-contributory benefit

38.      In the light of this finding, the issue of the classification of the Salzburg care allowance as a special non-contributory benefit, around which the discussion before the Court revolved, is actually no longer relevant.

39.      This issue will nevertheless be considered below. First of all, this examination would be important in the event that – contrary to my analysis – the Court were to regard provisional care allowance as a regionally applicable benefit within the meaning of Article 4(2b) of Regulation No 1408/71. Secondly, it would also be conceivable for provincial care allowance to be classified as a special non-contributory benefit within the meaning of Article 4(2a) of Regulation No 1408/71.

40.      In that case Regulation No 1408/71 would be applicable in principle. Nevertheless, in derogation from Article 10 and the special provisions laid down in Title III – Article 19 in particular for the purposes of the present case – entitlement to care allowance under Article 10a(1) could be made subject to a residence requirement. However, Article 10a(1) applies only to special non-contributory benefits ‘provided that such benefits are listed in Annex IIa’. That is not the case with the Salzburg provincial care allowance.

41.      Since, however, the Court gives the substantive assessment of a benefit precedence over the formal criterion of inclusion in one of the annexes, non-inclusion in the correct annex might not have any effect. Furthermore, it could be argued that inclusion in Annex IIa is in a sense, as a lesser provision, contained in inclusion in Annex II, Section III, because inclusion in Annex IIa has less far-reaching consequences than registration in Annex II, Section III.

42.      In Jauch the Court concluded that federal care allowance is not a special non-contributory benefit within the meaning of Article 4(2a) of Regulation No 1408/71, but a social security benefit within the meaning of Article 4(1)(a) (sickness benefits).

43.      The concept of special non-contributory benefit in Article 4(2b) has the same meaning as in Article 4(2a). The definition includes the characteristics set out in Article 4(2a)(a) and (b). Article 4(2b) therefore also relates to benefits which are neither classic social security benefits under Article 4(1) nor pure social assistance under Article 4(4) and which are granted as supplementary, substitute or ancillary cover against conventional risks or on their own as special protection for the disabled.

44.      This understanding takes account of the drafting history of the provisions, which was, as it were, an answer by the Community legislature to the Court’s case-law on ‘mixed benefits’. (18) The decisions that were the catalyst for the introduction of the provisions on special non-contributory benefits had related specifically to supplementary benefits (19) and benefits for the disabled. (20)

45.      It must therefore only be examined whether care allowance under the SPGG has characteristics that justify a different classification to federal care allowance.

46.      In the opinion of the Commission and the Netherlands Government, there is no reason to support this view. On the other hand, the defendant Province of Salzburg and the Austrian, Portuguese, Finnish and United Kingdom Governments consider provincial care allowance – unlike federal care allowance – to be a special non-contributory benefit. The individual arguments put forward by them are to be considered separately as part of the examination of the two elements of the definition, non-contributory nature and character as a special benefit.

a)      Non-contributory nature

47.      As the Province of Salzburg and the Governments that are supporting its claims rightly emphasise, care allowance under the SPGG is financed neither directly nor indirectly from social security contributions. (21) Under Paragraph 17(2) of the SPGG in conjunction with Paragraph 40(1) and (5) of the Salzburg Sozialhilfegesetz, the Province of Salzburg and the municipalities must each pay half of the costs. The funds for care allowance expenditure thus come entirely from the public purse.

48.      There is also no indirect financing link, which the Court took to exist in respect of federal care allowance in Jauch, in the case of care allowance under the SPGG. (22) Lastly, receipt of provincial care allowance is not dependent on the recipient also being entitled to another social security benefit financed through contributions, for example – as in the case of federal care allowance – a pension or an annuity. (23)

49.      It is true that Mr Hosse might contribute directly or indirectly to the financing of the budget of the Province of Salzburg through the income tax he pays in Austria. Nevertheless, benefits provided from general tax revenue are precisely not benefits financed through contributions within the meaning of Regulation No 1408/71. (24)

50.      However, it is not decisive on its own whether a benefit is non-contributory, since, under Article 4(2), Regulation No 1408/71 applies to all general and special social security schemes, whether contributory or non-contributory.(25) Therefore, the deciding factor is whether provincial care allowance should also be regarded as a special benefit.

b)      Special benefit

i)      Classification of provincial care allowance on the basis of the criteria laid down in Jauch

51.      The notion of special benefit presupposes that the benefit in question is not part of one of the branches of social security listed in Article 4(1) of Regulation No 1408/71. According to the Court’s settled case-law, a benefit falls within the scope of Article 4(1) of Regulation No 1408/71 in so far as, first of all, it is granted, without any individual and discretionary assessment of personal needs, to recipients on the basis of a legally defined position and, secondly, it relates to one of the risks listed in Article 4(1) of Regulation No 1408/71. (26)

52.      In Jauch the Court found, with reference to its decision in Molenaar, (27) that federal care allowance is a sickness benefit within the meaning of Article 4(1)(a) of Regulation No 1408/71. (28) Care allowance is conferred on persons to whom the BPGG applies. (29) The benefit remains of the same kind as the German care insurance benefits at issue in Molenaar. (30) These were essentially intended to supplement sickness insurance benefits in order to improve the state of health and quality of life of persons reliant on care. (31)

53.      Since the Court has now once again confirmed the classification of care benefits in Gaumain-Cerri (32) and expressly considered that there was no reason to revise that assessment, there is no longer any doubt that in Community law benefits to cover the risk of reliance on care are covered by Article 4(1)(a) of Regulation 1408/71. This assessment is not precluded by earlier judgments (33) referred to inter alia by the Province of Salzburg, since in those earlier cases the Court did not verify the existence of a special non-contributory benefit on the basis of substantive criteria. (34)

54.      Care allowance under the SPGG does not essentially differ from federal care allowance. In accordance with the identical wording of Paragraph 1 of the SPGG and Paragraph 1 of the BPGG both provisions are designed ‘to compensate in lump-sum form for the additional expenditure on care, so as to ensure as far as possible that persons reliant on care receive the necessary care and assistance and to improve their opportunity of leading an independent life in accordance with their needs’. Under Paragraph 3(1) of the SPGG there is a legal right to the benefit if the statutory requirements are satisfied. The amount of care allowance is determined in the individual case on the basis of objective criteria, first and foremost the amount of time needed for care. It is paid periodically in the form of a lump sum without the need for proof of actual expenditure.

ii)    Objections to classification of provincial care allowance as a social security benefit

55.      The Province of Salzburg and the Governments which are involved in the proceedings (with the exception of the Netherlands Government) take the view, however, that care allowance under the SPGG is much closer to social assistance than federal care allowance is, and therefore has the character of a special benefit.

–        No link with a scheme financed through contributions

56.      First, they point out that provincial care allowance, unlike federal care allowance, has no connection with a scheme financed through contributions. Any person who is not entitled to care allowance under the BPGG is entitled to claim. Provincial care allowance is also granted to persons who have never been employed, such as members of the family of workers or recipients of social assistance. Furthermore, there is absolutely no link at the organisational level with a scheme financed through contributions. Instead, care allowance is paid by the Province of Salzburg as the institution responsible for social assistance.

57.      In this respect, it should be reiterated that classification of a benefit under the case-law depends first and foremost on its nature. The nature of care allowance as a sickness benefit within the meaning of Article 4(1)(a) of Regulation No 1408/71 is not affected by national classification as a social assistance benefit and assignment at organisational level to the institution responsible for social assistance. (35) In other words, the legally defined purpose as a social security benefit, laid down in Paragraph 3 of the SPGG, is not called into question because national law provides for financing from social assistance funds.

58.      It is also irrelevant that there is no link with a scheme financed through contributions. First, the way in which the care allowance is financed does not change its character. (36) Second, in Jauch the Court considered it ‘of no importance … that the care allowance is intended to provide a financial supplement, having regard to a person’s reliance on care, to a pension paid on a basis other than sickness’. (37)

59.      Furthermore, under Article 4(2), Regulation No 1408/71 also applies precisely to non-contributory social security schemes. Therefore, it cannot be concluded from the fact that care allowance under the SPGG has absolutely no link with a contributory scheme that it is a special benefit or even social assistance within the meaning of Article 4(4). Rather, the rules on provincial and federal care allowance form a distinct non-contributory social security scheme within the meaning of Article 4(1)(a).

60.      However, with schemes of this kind it is more difficult to define the class of persons covered than in the case of schemes financed through contributions, where payment of contributions can be regarded as a bond establishing membership. Regulation No 1408/71 does not, however, permit entitlement to benefits in non-contributory schemes instead to be made subject to residence in the Member State. Consideration must also be given to other factors which give grounds for proximity to a Member State’s non-contributory scheme.

61.      Above all it is important that the person in question is employed in that State and that his earned income is taxed there. Since non-contributory schemes are financed through tax revenue, an employed person contributes in this way to the financing of the scheme. He should therefore also be entitled to benefits from the scheme.

62.      It follows in principle from Article 19(2) of Regulation No 1408/71 in respect of sickness benefits that the non-working, dependent members of the employed person’s family are also entitled under the scheme responsible for the employed person himself. (38) However, entitlement under the SPGG takes the form of an original entitlement of the person reliant on care and not an entitlement, derived from an employed person, of the members of his family. The extent to which this fact precludes the grant of the benefit in the case at issue is to be clarified in the answer to the second question, which seeks an interpretation of Article 19 of Regulation No 1408/71.

–        Subsidiarity of provincial care allowance

63.      Second, those parties stress that provincial care allowance is a subsidiary benefit in relation to federal care allowance. Like social assistance, it is granted only where no other cover exists.

64.      While it is true that an entitlement to care allowance under the SPGG exists only where there is no entitlement to federal care allowance, this is not an expression of subsidiarity, as is characteristic of social assistance benefits. Rather, the SPGG and the BPGG contain coordinated rules on competence which establish the federation’s competence, as the institution responsible for pension insurance, for a certain class of persons reliant on care, above all those in receipt of pensions and annuities. Others who are reliant on care fall within the competence of the provinces.

65.      Social assistance, on the other hand, is described as subsidiary since it guarantees the subsistence minimum if and in so far as no other financial resources are available. Unlike social assistance, but like federal care allowance, the Salzburg care allowance is paid irrespective of the financial need of the recipient, that is to say even where he is able to cover the subsistence minimum from his own funds.

–        Dependence of the benefit on need

66.      In this connection, however, the United Kingdom Government takes the view that, for the purposes of the grant of social assistance, need means not only poverty (financial need), but also special needs as a result of a disability. Accordingly, the cash benefit at issue has elements of social assistance simply because it is granted to persons who are reliant on care.

67.      In its definition of social security benefit, the criteria adopted by the Court have included that the benefit in question is granted without any individual and discretionary assessment of personal needs.(39) If social security benefits and social assistance are understood as opposing concepts, it may be concluded conversely from the Court’s finding that social assistance is granted on the basis of a discretionary decision with reference to personal needs.

68.      However, first, according to the statements made by the referring court, there is practically no margin of discretion in assessing the need for care because the authorities must adhere to the detailed stipulations laid down in the grading regulation.

69.      Second, a benefit may be classified as social assistance only where its grant depends on financial need. Special needs as a result of other personal circumstances are typically compensated precisely by social security benefits which are granted irrespective of income. For example, sickness benefits serve to cover the costs of treatment. Family benefits are awarded to anyone who has to bear particular burdens in connection with raising children. Sick people and parents therefore have greater needs, without the benefits granted to them on account of those needs becoming social assistance. This would be the case only where just those people who could not cover the greater needs (treatment costs, child-raising expenditure) from their own funds could claim benefits. However, this condition does not generally exist in the case of these benefits, nor does it with provincial care allowance.

–        Link between the benefit and the social environment in the State of residence

70.      Lastly, reference is made to the Court’s case-law under which the Member States may make benefits which are linked closely with the social environment subject to a condition of residence in the State of the competent institution. (40)

71.      An argument in favour of such a link in the present case could be the fact that care allowance rates are determined with reference to the expenditure required for the care of disabled people in Austria. However, the Court has made clear that a condition of residence in the State of the competent institution may be required for the receipt of benefits closely linked with the social environment only where the benefit in question is a special non-contributory benefit and not a social security benefit within the meaning of Article 4(1) of Regulation No 1408/71. (41) The mere receipt of a benefit under the conditions at the place of residence does not therefore give grounds to conclude that it is in the nature of a special benefit.

iii) Classification of provincial care allowance in the light of the purpose of Regulation No 1408/71

72.      Lastly, the following consideration relating to the purpose of Regulation No 1408/71 militates against classification of provincial care allowance as a non-exportable special benefit. The regulation is intended to coordinate the Member States’ social security schemes. Coordination means that two or more different social security schemes are brought into line with one another in such a way that a migrant worker receives benefits in respect of a risk exactly once. Multiple entitlement is intended to be avoided, as is complete exclusion from entitlement.

73.      In the case at issue, both the State of residence, Germany, and the State of employment, Austria, provide for benefits in respect of reliance on care. However, Germany has opted for a contributory model. Under that model, benefits are granted above all to employed persons who pay contributions from their earned income into the care insurance scheme, and to their relatives who are also covered. Austria, on the other hand, has introduced a non-contributory scheme which depends on residence for anyone who does not receive a pension or annuity under the BPGG.

74.      If both schemes were applied to the letter, members of the families of migrant workers who are in the same situation as the Hosses would not be entitled under either scheme, even though both Member States have recognised the need for care benefits. In Germany there is no employment liable to compulsory social insurance contributions on the part of the person responsible for supporting the family. In Austria the claim fails because of the family’s place of residence.

75.      For the regulation to attain its aims in this situation, it must be interpreted in such a way that care allowance may be claimed under it in one State. There is a closer link with Austria than with Germany in so far as Mr Hosse pays tax on his earned income in the State of employment and thus contributes to the financing of the benefit there. In Germany, on the other hand, there is no such financing link, either through payment of social insurance contributions or through taxes paid on earned income.

76.      It is not important that Mr Hosse does not contribute to the financing of the national budget in Austria in exactly the same way as Austrian nationals, an argument to which the Province of Salzburg has referred. He is subject to taxation in Austria only on his earned income as a teacher, while tax must be paid on other earnings at the place of residence; however, in the case of an employed person like Mr Hosse, earnings from employment generally account for most of the taxable income. The State in which a frontier worker makes a greater contribution to revenue from value added tax and excise duties depends on the facts of the specific case (e.g. local shopping facilities, the level of tax rates and, therefore, prices) which cannot be taken into account in the context of an abstract assessment.

77.      The provisions of the regulation also ensure that Silvia Hosse is not able to claim care allowance more than once. As soon as she is also entitled to care allowance at her place of residence, for example because her mother resumes employment and Silvia is covered as a member of her family by the German care insurance scheme, the proviso contained in Article 19(2)(1) of Regulation No 1408/71 takes effect. Under that provision, members of the family of a migrant worker who do not live in the State of employment may not claim any sickness benefits in cash under the rules of that State (i.e. export of benefits) where they are entitled to such benefits under the legislation of their State of residence.

c)      Other requirements under Article 4(2a) of Regulation No 1408/71

78.      Aside from the fact that provincial care allowance does not therefore have the character of a special benefit, the other requirements of Article 4(2a) of Regulation No 1408/71 are not satisfied either. It is not a benefit which provides supplementary, substitute or ancillary cover in respect of a ‘classic’ social security benefit within the meaning of Article 4(2a)(a). Instead, the parties stress that provincial care allowance is autonomous of other benefits.

79.      Furthermore, it is not a benefit that is granted solely as specific protection for the disabled either, but it is a general benefit in respect of reliance on care which may also be awarded to disabled persons. Although the category of disabled persons may often overlap with the class of persons reliant on care, it is nevertheless far from certain that the class of recipients is always identical. For example, not all disabled persons are dependant on care benefits. In addition, people who are reliant on care for reasons of age do not all automatically have to be regarded as disabled persons.

4.      The legal situation since 5 May 2005

80.      The referring court asks for an interpretation of Regulation No 1408/71 as amended by Regulation No 1247/92. However, Regulation No 1408/71 has been amended several times since 1992. (42) It is for the referring court to determine the period to which its decision relates and the version of the regulation which is therefore relevant.

81.      Should the Oberster Gerichtshof also be required to decide whether Silvia Hosse is entitled to care allowance in the future, the applicable version – subject to further amendments – would be the version of Regulation No 1408/71 that has applied since 5 May 2005. (43) Article 4(2a) in particular was revised as a result of this most recent amendment.

82.      However, consideration of the current legal situation does not affect the above classification of provincial care allowance, since the revised version of Regulation No 1408/71 essentially makes clarifications and takes account of developments in the case-law of the Court of Justice. (44)

5.      Interim conclusion

83.      A benefit such as the provincial care allowance at issue in the main proceedings is not a benefit which stems from legislation ‘the validity of which is confined to part of the territory of a Member State’ within the meaning of Article 4(2b) of Regulation No 1408/71. Furthermore, it does not fall within the scope of either Article 4(2a) or Article 4(2b) of Regulation No 1408/71 because it does not have the character of a special benefit.

84.      The answer to the first question must therefore be that a benefit such as care allowance under the Salzburger Pflegegeldgesetz does not constitute a special non-contributory benefit within the meaning of Article 4(2b) of Regulation No 1408/71, the validity of which is confined to part of the territory of a Member State, but a sickness benefit under Article 4(1)(a) of the regulation.

B –    The second question – Entitlement of the members of the family of an employed person who do not live in the State of employment (Article 19 of Regulation No 1408/71)

85.      In the event that care allowance is classified as a social security sickness benefit, the referring court seeks, by its second question, to ascertain whether it is contrary to Article 19 of Regulation No 1408/71 for a member of the family of a person employed in Austria to be refused the grant of the benefit because the family lives in another Member State.

86.      In Jauch the Court has already ruled that the Austrian federal care allowance is a sickness benefit in cash which must be provided under Article 19(1)(b) of Regulation No 1408/71 irrespective of the Member State in which a person reliant on care, who satisfies the other conditions for receipt of the benefit, is resident. (45) This also holds for the Salzburg provincial care allowance, which is paid on the basis of the same principles. (46)

87.      However, the judgment in Jauch concerned a case where a pensioner living in Germany, who had been employed in Austria prior to his retirement, made a claim for care allowance under the BPGG to the competent Austrian institution. That claim was based on his own former status as an employed person. The present case, on the other hand, relates to an entitlement which Silvia Hosse might enjoy only as a member of the family of a migrant worker.

88.      Under Article 19(2)(1) of Regulation No 1408/71, Article 19(1) applies by analogy to members of the family who are residing in the territory of a Member State other than the competent State, where they are not entitled to such benefits under the legislation of the State in whose territory they reside. (47)

89.      In Kermaschek (48) and in subsequent cases (49) the Court admittedly ruled that under Article 2 of Regulation No 1408/71 the members of the family of employed persons can only claim derived rights, that is to say, those which they have acquired through their status as a member of the family of an employed person and not those which are granted to them in their own right whether or not they are related to an employed person. Consequently, Silvia Hosse could not rely on Regulation No 1408/71 for an entitlement to benefits under the SPGG, because care allowance takes the form of a benefit acquired as a right of her own.

90.      In Cabanis-Issarte, (50) however, the Court qualified this case-law significantly. It maintained that Regulation No 1408/71 does differentiate in principle between employed persons and members of their families as far as the class of persons entitled is concerned, but it abandoned the distinction drawn between own rights and derived rights. (51) That distinction jeopardises the uniform application of Community rules ‘by making their applicability to individuals depend on whether the national law relating to the benefits in question treats the rights concerned as rights in person or as derived rights, in the light of specific features of the domestic social security scheme’. (52) Furthermore, the distinction drawn between own rights and derived rights results in a restriction of the fundamental rule of equal treatment laid down in Article 3 of Regulation No 1408/71. (53)

91.      Family members are excluded from the scope of the regulation only in so far as specific provisions of the regulation show that they apply only to the employed persons themselves. (54) For example, the provisions laid down in Title III, Chapter 6 of Regulation No 1408/71 on unemployment benefits do not apply to family members. (55) Family benefits, on the other hand, are not restricted to the employed persons themselves, whether they are based on own rights or derived rights. (56)

92.      However, it is clear from Article 19(2) of Regulation No 1408/71 that sickness benefits in cash, which, as has been established, include the Salzburg provincial care allowance, may also be claimed by the members of the family of a migrant worker who do not live in the State of employment. The only restriction is that they must not enjoy similar entitlements of their own at their place of residence. It is irrelevant, on the other hand, that the entitlement to care allowance stems from an own right and not a derived right.

93.      The answer to the second question must therefore be that a member of the family of a person employed in one Member State who lives with his family in another Member State may under Article 19 of Regulation No 1408/71 claim from the competent institution of the place of employment of the employed person payment of a benefit such as the one at issue in the present case as a sickness benefit in cash, in so far as the member of the family is not entitled to a similar benefit under the legislation of the State in whose territory she resides.

C –    The third question – Provincial care allowance as a social advantage within the meaning of Article 7 of Regulation No 1612/68

94.      The third question is intended to clarify whether the principle of non-discrimination enshrined in Article 7(2) of Regulation No 1612/68 precludes a condition making entitlement to care allowance subject to residence in Austria. The referring court asks this question only in the event that the benefit constitutes a special non-contributory benefit and its export is thus not required under Regulation No 1408/71. In view of my opinion on the first and second questions, there would therefore be no need to answer the third question. In order to give the Court a complete picture, however, I will examine this question.

95.      Under Article 7(2) of Regulation No 1612/68, a worker who is a national of one Member State and works in another Member State enjoys the same social advantages there as national workers.

96.      It is settled case-law that ‘social advantages’ should be interpreted as meaning all advantages which, whether or not linked to a contract of employment, are generally granted to national workers because of their objective status as workers or by virtue of the mere fact of their residence on the national territory, and whose extension to workers who are nationals of other Member States therefore seems likely to facilitate the mobility of such workers within the Community. (57) The Salzburg provincial care allowance is rightly regarded by all the parties in principle as a social advantage in this sense.

97.      The right to the same treatment as a national also extends to benefits for dependent children of a migrant worker, (58) since those benefits too ultimately benefit the employed person by relieving him partially of the burden of maintenance expenditure.

98.      However, the Province of Salzburg and the Governments which have submitted observations point out that Austrian nationals are entitled to care allowance only if they live in the Province of Salzburg. It is therefore not discriminatory for entitlement to the benefit also to be made subject to a condition of residence in the area covered by the SPGG for nationals of other Member States. In the judgments on the financing of studies in the Netherlands (59) the Court only regarded it as discrimination that an additional residence requirement, which did not apply to nationals, was imposed on children of migrant workers.

99.      It cannot of course be concluded from those decisions that only such rules that discriminate overtly by reason of nationality infringe Article 7(2) of Regulation No 1612/68. Rather, the principle of equal treatment laid down both in Article 39 EC and in Article 7 of Regulation No 1612/68 forbids not only overt discrimination by reason of nationality but also all covert forms of discrimination which, by the application of other criteria of differentiation, lead in fact to the same result. (60)

100. A provision of national law must be regarded as indirectly discriminatory if it is intrinsically liable to affect migrant workers more than national workers and there is a consequent risk that it will place the former at a particular disadvantage, and if it is not justified by objective considerations independent of the nationality of the workers concerned, and proportionate to the legitimate aim pursued by that law. (61)

101. It is clear that the requirement to be resident in the area covered by the law on the benefit, even though formally it applies equally to nationals, affects first and foremost nationals of other Member States. This condition operates to the detriment of, in particular, frontier workers who, by definition, are resident in a Member State where, as a general rule, the members of their family are also resident. (62) The residence requirement therefore runs counter to the aim of Regulation No 1612/68, to guarantee the right of free movement for frontier workers in the same way as other workers who are nationals of a Member State. (63)

102. However, the Province of Salzburg and the Governments which have submitted observations (with the exception of the Portuguese Government) attempt to limit the scope of Article 7(2) of Regulation No 1612/68.

103. The Province of Salzburg takes the view, first of all, that the principle of non-discrimination laid down in Article 7(2) of Regulation No 1612/68 does not preclude a residence requirement where the export of the benefit in question is not required under Regulation No 1408/71 either, because it is a special non-contributory benefit.

104. Aside from the fact that there is no special non-contributory benefit in the present case, the assumption that Regulation No 1408/71 has such an effect is not consistent with the case-law. For example, the Court has held that the exclusion of a benefit from the scope of Regulation No 1408/71 does not have the effect of dispensing Member States from the obligation to ensure that no other rule of Community law, in particular Regulation No 1612/68, precludes the imposition of a residence condition. (64) The notion of social advantage in Article 7(2) of Regulation No 1612/68 is broader than the notion of social security benefit under Regulation No 1408/71. Consequently, the fact that a benefit does not fall or does not completely fall within the scope of Regulation No 1408/71 and that regulation does not thus require the export of the benefit says nothing about the requirements laid down in Regulation No 1612/68 for the grant of the benefit.

105. The Province of Salzburg and the governments which have submitted observations (with the exception of the Portuguese Government) also take the view that reliance on Regulation No 1612/68 is not possible where – as in the present case – there is no link at all between the grant of the benefit and the claimant’s objective status as a worker. In support of these arguments, they rely in particular on the judgments in Meints (65) and Fahmi, (66) in which the Court particularly stressed the link to status as a worker.

106. However, those decisions related to a particular set of factual circumstances. Former migrant workers had returned to their home country after the end of their employment and were now claiming social advantages for themselves or their children from the State in which they had previously lived and worked. The status as a worker which could have given grounds for entitlements to benefits no longer subsisted in this instance, with the result that, as the Court ruled, the persons concerned could no longer rely on Article 7(2) of Regulation No 1612/68.

107. In the present case it is undisputed that Mr Hosse is a person employed in Austria. There is no question of his status of a migrant worker having ended. His daughter Silvia Hosse, on the other hand, is not herself an employed person. However, this is completely irrelevant. If it were required that the person benefiting directly from the social advantage is himself employed in the host country, Article 7(2) of Regulation No 1612/68 would be rendered redundant in principle in the case of advantages for non-employed members of the family. This would run flagrantly counter to settled case-law. (67)

108. Lastly, the Netherlands Government puts forward four grounds to justify possible de facto unequal treatment.

109. First, the Netherlands Government states that the amount of the benefit is correlated to costs of living and of care in the State in which the competent institution is based. This correlation is no longer guaranteed if the recipient lives in another State. In order to counter this objection, the State paying the benefit could possibly be given the right to adjust the benefit where the cost level in the State in which the recipient is resident is significantly different, in so far as this is not precluded by Regulation No 1408/71. However, under no circumstances can the consequence of this argument be that the person in question is denied the benefit entirely.

110. Second, the Netherlands Government argues that it must be ensured that the person in question does not receive similar benefits twice, once from the institution of his place of residence and once from the institution of the place of employment. It does indeed seem appropriate in this respect to interpret the principle of equal treatment laid down in Article 7(2) of the regulation to the effect that the basic position is not comparable and does not therefore have to be treated equally where the recipient family member is entitled to an equivalent benefit at his place of residence. Practically, overlapping entitlement to benefits can be prevented by a requirement to make appropriate declarations when submitting an application. Abuse must be countered where necessary by means of cooperation between the relevant authorities. Moreover, similar mechanisms are also needed for the application of Article 19(2) of Regulation No 1408/71.

111. Third, the Netherlands Government argues that the grant of benefits to guarantee the subsistence minimum requires ongoing checks of the recipient’s family circumstances, which are very difficult to carry out in a cross-border situation. In this respect, it need only be pointed out that the provincial care allowance at issue in the present case is granted irrespective of financial need. It is not therefore necessary to conduct investigations into the claimant’s situation – apart from establishing the degree of reliance on care – for the grant of care, allowance under the SPGG. As regards assessing reliance on care, certificates from doctors at the claimant’s place of residence could be used, for example.

112. Fourth, the Netherlands Government points to the connection between the entitlement to a benefit and the financing of costs from public funds, which are an expression of solidarity between the people resident in a Member State. In view of the fact that through the taxes on his earned income Mr Hosse contributes to the financing of the public purse in Austria, the idea of solidarity almost demands that his daughter be granted the care allowance financed from that purse.

113. The answer to the third question must therefore be that a benefit such as care allowance under the Salzburger Pflegegeldgesetz, as a social advantage within the meaning of Article 7(2) of Regulation (EEC) No 1612/68 of the Council of 15 October 1968 on freedom of movement for workers within the Community, may not be made subject to the condition that the recipient of the benefit must have his main residence in the area covered by the law on the benefit.

D –    The fourth question – Rights stemming from citizenship of the Union

114. The fourth question concerning the rights stemming from citizenship of the Union in conjunction with the general principle of non-discrimination (Articles 12 EC and 17 EC) is likewise asked only in the event that freedom of movement for workers, as given expression in Article 7(2) of Regulation No 1612/68, does not preclude the residence requirement (third question).

115. Since Mr Hosse is able to rely on his rights stemming from freedom of movement for workers, it is no longer necessary to interpret Article 12 EC in conjunction with Article 17 EC. That provision can apply independently only to situations governed by Community law in respect of which the Treaty lays down no specific prohibition of discrimination. (68)

V –  Conclusion

116. I therefore propose the following answers to the questions referred by the Oberster Gerichtshof:

(1)      A benefit such as care allowance under the Salzburger Pflegegeldgesetz does not constitute a special non-contributory benefit within the meaning of Article 4(2b) 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, the validity of which is confined to part of the territory of a Member State, but a sickness benefit under Article 4(1)(a) of the regulation.

(2)      A member of the family of a person employed in one Member State who lives with his family in another Member State may under Article 19 of Regulation No 1408/71 claim from the competent institution of the place of employment of the employed person payment of a benefit such as the one at issue in the present case as a sickness benefit in cash, in so far as the member of the family is not entitled to a similar benefit under the legislation of the State in whose territory she resides.

(3)      A benefit such as care allowance under the Salzburger Pflegegeldgesetz, as a social advantage within the meaning of Article 7(2) of Regulation (EEC) No 1612/68 of the Council of 15 October 1968 on freedom of movement for workers within the Community, may not be made subject to the condition that the recipient of the benefit must have his main residence in the area covered by the law on the benefit.


1 – Original language: German.


2 – Case C-215/99 Jauch [2001] ECR I-1901.


3 – 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 (OJ, English Special Edition 1971 (II), p. 416), as amended and updated by Council Regulation (EC) No 118/97 of 2 December 1996 (OJ 1997 L 28, p. 1). Where subsequent amendments are of importance, they are cited when the relevant provision is quoted.


4 – Regulation (EEC) No 1612/68 of the Council of 15 October 1968 on freedom of movement for workers within the Community (OJ, English Special Edition 1968 (II), p. 475), as amended by Council Regulation (EEC) No 2434/92 of 27 July 1992 (OJ 1992 L 245, p. 1).


5 – As amended by Council Regulation (EC) No 307/1999 of 8 February 1999 (OJ 1999 L 38, p. 1).


6 – Since 1 May 2004 Annex II, Section III, letter R ( Act concerning the conditions of accession of the Czech Republic, the Republic of Estonia, the Republic of Cyprus, the Republic of Latvia, the Republic of Lithuania, the Republic of Hungary, the Republic of Malta, the Republic of Poland, the Republic of Slovenia and the Slovak Republic and the adjustments to the Treaties on which the European Union is founded – Annex II: List referred to in Article 20 of the Act of Accession – 2. Freedom of movement for persons – A. Social security (OJ 2003 L 236, p. 179 et seq).


7 – Regulation (EC) No 647/2005 of the European Parliament and of the Council of 13 April 2005 amending Council Regulations (EEC) No 1408/71 on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community and (EEC) No 574/72 laying down the procedure for implementing Regulation (EEC) No 1408/71 (OJ 2005 L 117, p.1).


8 – BGBl. No 866/1993.


9 – BGBl. No 110/1993.


10 – LGBl. No 99/1993. The text of the law is also available on the Internet at: www.salzburg.gv.at/themen/gs/soziales_einstieg2/soziales_recht/recht_pflegegeldgesetz.htm (last visited on 26 July 2005).


11 – Jauch, cited in footnote 2, paragraph 21. With regard to these legal effects of inclusion of a benefit in an annex to Regulation No 1408/71, see also the detailed examination by Advocate General Alber in his Opinion in Jauch, point 61 et seq.


12 – Jauch, cited in footnote 2, paragraph 20.


13 – Jauch, cited in footnote 2, paragraph 21. See also Case C-160/02 Skalka [2004] ECR I-5613, paragraph 19.


14 – On the other hand, Article 10a of Regulation 1408/71, which was the subject of the judgment in Jauch, provides only for a derogation from the waiving of the residence clauses, but in other respects does not affect the coordinating effect of the regulation in respect of the benefits covered.


15 – Cited in footnote 8.


16 – See in particular the third to eighth recitals in the preamble to Council Regulation (EEC) No 1247/92 of 30 April 1992 amending Regulation (EEC) No 1408/71 on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community (OJ 1992 L 136, p. 1).


17 – See point 30 above.


18 – See the third and fourth recitals of Regulation No 1247/92 (cited in footnote 16).


19 – See, for example, Case 139/82 Piscitello [1983] ECR 1427, Joined Cases 379/85 to 381/85 and 93/86 Gilett [1987] ECR 955, Case 147/87 Zaoui [1987] ECR 5511, Case C-307/89 Commission v France [1991] ECR I-2903, and Case C-65/92 Levatino [1993] ECR I-2005.


20 – Case C-356/89 Newton [1991] ECR I-3017.


21 – This is the sole relevant factor for classification as ‘non-contributory’ (see Jauch, cited in footnote 2, paragraphs 32 and 33, and Skalka, cited in footnote 13, paragraph 28).


22 – The sickness insurance contributions had been increased in order to compensate for transfers between sickness and pension insurance schemes resulting from the introduction of federal care allowance (see Jauch, cited in footnote 2, paragraph 33).


23 – In his Opinion in Jauch (cited in footnote 11, point 109 et seq.) Advocate General Alber took the view that federal care allowance is contributory for this reason alone. See the critical assessment in my Opinion in Skalka, point 34 et seq.


24 – Clarification is provided in the version of Article 4(2a) as amended by Regulation No 647/2005 (see point 18 above).


25 – Case C-78/91 Hughes [1992] ECR I-4839, paragraph 21; see also the Opinion in Jauch, cited in footnote 11, point 83, and the Opinion in Skalka, cited in footnote 23, point 32.


26Jauch, cited in footnote 2, paragraph 25; see also Case 249/83 Hoeckx [1985] ECR 973, paragraphs 12 to 14; Hughes, cited in footnote 25, paragraph 15; Joined Cases C-245/94 and C‑312/94 Hoever and Zachow [1996] ECR I-4895, paragraph 18; and Case C-160/96 Molenaar [1998] ECR I-843, paragraph 20.


27 – Cited in footnote 26.


28 – Jauch, cited in footnote 2, paragraph 28.


29 – Jauch, cited in footnote 2, paragraph 27.


30 – Jauch, cited in footnote 2, paragraph 26.


31 – Jauch, cited in footnote 2, paragraph 28, referring to Molenaar, cited in footnote 26, paragraph 24.


32 – Joined Cases C-502/01 and C-31/02 Gaumain-Cerri [2004] ECR I-6483, paragraph 20. In that judgment the Court even regarded old age insurance benefits for a third party assisting a person reliant on care as sickness benefits within the meaning of Article 4(1)(a) of Regulation No 1408/71 payable to the person reliant on care.


33 – See in particular Case C-20/96 Snares [1997] ECR I-6057 and Case C-297/96 Partridge [1998] ECR I-3467.


34 – Jauch, cited in footnote 2, paragraph 17.


35 – Jauch, cited in footnote 2, paragraph 26, and Case 9/78 Gillard [1978] ECR 1661, paragraphs 10 to 15.


36Jauch, cited in footnote 2, paragraph 28.


37Jauch, cited in footnote 2, paragraph 28.


38 – According to the explanations given by the Province of Salzburg and the Austrian Government, Mr Hosse would be entitled to federal care allowance as a pensioner. If, however, he became reliant on care before retirement, he would be entitled to care allowance under the SPGG, if the issue of residence is disregarded.


39 – See point 51 above and the references to case-law in footnote 26.


40 – Case 313/86 Lenoir [1988] ECR 5391, paragraph 16, and Case C-43/99 Leclere and Deaconescu [2001] ECR I-4265, paragraph 32. See also the version of Article 4(2a) as amended by Regulation No 647/2005 (see point 18 above).


41 – Leclere and Deaconescu, cited in footnote 40, paragraph 35 et seq.


42 – See the references to the relevant provisions, which are cited in the section on Legal framework (point 10 et seq.).


43 – See point 18 above.


44 – See the first recital in the preamble to Regulation No 647/2005. In the third recital particular reference is made to the judgments in Jauch (cited in footnote 2) and Leclere and Deaconescu (cited in footnote 40).


45Jauch, cited in footnote 2, paragraph 35 and Molenaar, cited in footnote 26, paragraph 36. See also Gaumain-Cerri, cited in footnote 32, paragraph 26.


46 – See point 54 above.


47Gaumain-Cerri, cited in footnote 32, paragraph 28. The facts underlying one of the main actions were similar to those in the present case: the son reliant on care of Ms Gaumain-Cerri, who was employed as a frontier worker and covered by care insurance in Germany, lived with her in France; nevertheless, her son received care allowance from the German insurance scheme (paragraph 9 of the judgment).


48 – Case 40/76 Kermaschek [1976] ECR 1669, paragraph 7 et seq.


49 – Case 157/84 Frascogna [1985] ECR 1739, Case 94/84 Deak [1985] ECR 1873, Zaoui, cited in footnote 19, Case C-243/91 Taghavi [1992] ECR I-4401, and Case C-310/91 Schmid [1993] ECR I-3011.


50 – Case C-308/93 Cabanis-Issarte [1996] ECR I-2097. With regard to the development of the case-law, see also the Opinion of Advocate General Alber in Case C-189/00 Ruhr [2001] ECR I-8225, point 47 et seq.


51 – See in particular paragraph 34 of the judgment in Cabanis-Issarte, cited in footnote 50.


52 – Cabanis-Issarte, cited in footnote 50, paragraph 31.


53 – Cabanis-Issarte, cited in footnote 50, paragraph 34.


54 – Cabanis-Issarte, paragraph 22.


55 – See Case C-189/00 Ruhr [2001] ECR I-8225, paragraphs 21 and 24, which expressly confirmed the judgment in Kermaschek (cited in footnote 48) in this regard.


56Hoever and Zachow, cited in footnote 26, paragraph 32 et seq., and Case C-255/99 Humer [2002] ECR I-1205, paragraph 50 et seq.


57 – Schmid, cited in footnote 49, paragraph 18 and Case C-57/96 Meints [1997] ECR I-6689, paragraph 39.


58 – Case 32/75 Cristini [1975] ECR 1085, paragraph 19, Case C-337/97 Meeusen [1999] ECR I-3298, paragraph 22, and Case C-258/04 Ioannidis [2005] ECR I-0000, paragraph 35.


59 – Case C-3/90 Bernini [1992] ECR I-1071 and Meeusen, cited in footnote 58.


60 – Case 152/73 Sotgiu [1974] ECR 153, paragraph 11; Case C-111/91 Commission v Luxembourg [1993] ECR I-817, paragraph 9; Case C-237/94 O’Flynn [1996] ECR I-2617, paragraph 17; Case C-57/96 Meints, cited in footnote 57, paragraph 44; and Case C-195/98 Österreichischer Gewerkschaftsbund [2000] ECR I-10497, paragraph 39.


61 – Thus summarised in Österreichischer Gewerkschaftsbund, cited in footnote 60, paragraph 40. See also Commission v Luxembourg, cited in footnote 60, paragraph 10, O’Flynn, cited in footnote 60, paragraphs 18 and 19, and Meints, cited in footnote 57, paragraph 45.


62 – Meeusen, cited in footnote 58, paragraph 24.


63 – As said in Meints (cited in footnote 57, paragraph 50) and Case C-337/97 Meeusen cited in footnote 58, paragraph 21) with reference to the fourth recital in the preamble to Regulation No 1612/68.


64 – See in particular Leclere and Deaconescu, cited in footnote 40, paragraph 31, and Commission v Luxembourg, cited in footnote 60, paragraph 20 et seq.


65 – Cited in footnote 57, paragraph 41.


66 – Case C-33/99 Fahmi and Esmoris Cerdeiro-Pinedo Amado [2001] ECR I-2415, paragraph 47.


67 – See the references in footnote 58.


68 – See Case C-131/96 Mora Romero [1997] ECR I-3659, paragraph 10, and Case C-100/01 Olazabal [2002] ECR I-10981, paragraph 25.

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