JUDGMENT OF THE COURT OF FIRST INSTANCE (Fifth Chamber)

18 March 2004

Case T-204/01

Maria-Luise Lindorfer

v

Council of the European Union

(Officials – Transfer of the flat-rate redemption value of retirement pension rights acquired in the course of professional activities prior to entry into the service of the Communities – Calculation of the years of pensionable service – Article 11(2) of Annex VIII to the Staff Regulations – General implementing provisions – Principle of equal treatment – Freedom of movement for workers)

Full text in French II - 0000

Application:         for annulment of the Council decision of 3 November 2000 calculating the applicant’s years of pensionable service following transfer to the Community scheme of the flat-rate redemption value of the retirement pension rights which she had acquired under the Austrian scheme.

Held:         The application is dismissed. The parties are ordered to bear their own costs.

Summary

1.     Officials – Pensions – Pension rights acquired before entering the service of the Communities – Transfer to the Community scheme – Rules

(Staff Regulations, Annex VIII, Art. 11(2))

2.     Officials – Pensions – Pension rights acquired before entering the service of the Communities – Transfer to the Community scheme – Crediting of years of pensionable service – Method of calculation – Official recruited in the higher grade of his category – Taking into account of basic salary on the date of establishment as an official – Discrimination compared with officials recruited at the basic grade – None

(Staff Regulations, Annex VIII, Art. 11(2); Council’s general implementing provisions, Art. 10(3))

3.     Officials – Pensions – Pension rights acquired before entering the service of the Communities – Transfer to the Community scheme – Crediting of years of pensionable service – Method of calculation – Use of factors which vary according to gender and age – Whether permissible

(Staff Regulations, Annex VIII, Art. 11(2))

4.     Officials – Pensions – Pension rights acquired before entering the service of the Communities – Transfer to the Community scheme – Actuarial assessment of the pension scheme – Determination of the number of years of pensionable service on the basis of an actuarial assessment – Entirely separate operations

(Staff Regulations, Art. 83(4); Annex VIII, Art. 11(2))

1.     The system for transferring the actuarial equivalent or the flat-rate redemption value of retirement pension rights acquired by an official in the course of professional activities before he entered the service of the Communities involves two separate main phases.

The first consists of the establishment of the actuarial equivalent or the flat-rate redemption value by the national or international authority administering the pension scheme to which the official concerned belonged before he entered the service of the Communities. The purpose of calculating the actuarial equivalent is to capitalise the value of a future contingent periodic benefit and is therefore based on a calculation of the capital corresponding to the pension to which the person concerned will be entitled under the national or international pension scheme in question, by the application of a discount rate by reason of the anticipated nature of the payment as compared with the due date, together with a reduction coefficient proportionate to the risk of the death of the recipient before the due date, determined as a function of the age of the insured and of the death rate, both factors being calculated on the basis of the time due to elapse between the date of the award of the actuarial equivalent and that of the grant of the pension. The calculation of the flat-rate redemption value may be effected in contributory insurance schemes by adding up the contributions paid by the insured person, together, where appropriate, with those paid by his employer; interest may be added to these contributions.

The second phase consists of the conversion by the Community institution concerned of the capital corresponding to the actuarial equivalent or the flat-rate redemption value into years of pensionable service to be included in the Community pension scheme in addition to those to which the official will be entitled in respect of his work for the Communities.

The two decisions – one concerning the calculation of the actuarial equivalent or flat-rate redemption value and the other concerning the conversion of those assets into years of pensionable service – fall within different legal systems, and each must be dealt with by the courts having the relevant jurisdiction. Thus the rules for calculating the amount of the actuarial equivalent or the flat-rate redemption value are the responsibility solely of the national or international authority administering the previous pension scheme of the person concerned. That amount is then reassessed by the Community institution concerned on the basis of the rules applicable under the Community’s pension scheme. Since both of those operations are based on different particulars and considerations regarding the history of those concerned, their future prospects, the amount of contributions and the nature and amount of benefits, it is entirely possible that the determination of the years of pensionable service to be taken into account for the Community pension leads to a different figure from the years of pensionable service taken into account by the national or international authority.

(see paras 28-31)

See: 212/81 Bodson [1982] ECR 1019, paras 7 and 8; 118/82 to 123/82 Celant and Others v Commission [1983] ECR 2995, para. 28; 75/88, 146/88 and 147/88 Bonazzi-Bertottilli and Others v Commission [1989] ECR 3599, para. 19; T-233/97 Bang-Hansen v Commission [1998] ECR-SC I-A-625 and II-1889, para. 39; T-103/98, T-104/98, T-107/98, T-113/98 and T-118/98 Kristensen and Others v Council [1999] ECR-SC I-A-215 and II-1111, para. 34

2.     The Staff Regulations, including Annex VIII thereto, contain no provisions specifically governing, as regards the transfer of the actuarial equivalent or the flat-rate redemption value of pension rights acquired before entry into the service of the Communities, the situation of a new official recruited at the higher grade of his category. In the absence of such specific provisions, the transfer of the actuarial equivalent or the flat-rate redemption value of the pension rights of that official is, as for any other official, governed by the provisions of Article 11(2) of Annex VIII to the Staff Regulations and by Article 10(3) of the general implementing provisions, pursuant to which the number of years of pensionable service to be credited is to be calculated by reference to the official’s grade on establishment.

In the case of an official recruited at the higher grade, that will admittedly mean that the number of years pensionable service credited will be smaller than that credited to an official recruited at the basic grade, but that does not result in discrimination, because there can be no discrimination unless different rules are applied to comparable situations or the same rule is applied to different situations.

(see paras 61, 64)

See: 8/82 Wagner [1983] ECR 371, para. 18; 283/83 Racke [1984] ECR 3791, para. 7; C-311/97 Royal Bank of Scotland [1999] ECR I-2651, para. 26; T-106/01 Youssouroum v Council [2002] ECR-SC I-A-93 and II-435, para. 41

3.     The use of factors which vary according to gender and age for calculating the number of years of pensionable service to be credited is objectively justified by the need to ensure the sound financial management of the Community pension scheme. Where, under Article 11(2) of Annex VIII to the Staff Regulations, an official arranges for capital representing the pension rights he acquired before entering the service of the Communities to be transferred to the Community budget in the form of an actuarial equivalent or flat-rate redemption value, he obtains in return an entitlement to future benefits under the Community pension scheme which is represented by years of pensionable service credited and whose scale is a function of the number of years he is granted. In order to determine the current value of that entitlement, the Community institution concerned must take account of a series of factors including the probable period during which the capital brought by the person concerned will remain in the Community budget, the anticipated progress of his career, the probability that the benefits will be paid to him and the probable period for which those payments will be made. Clearly, those factors depend in particular on the gender of the person concerned and his or her age when joining the Community pension scheme.

(see para. 83)

4.     The actuarial assessment of the pension scheme provided for in Article 83(4) of the Staff Regulations concerns the Community pension scheme as a whole and its aim is to verify whether the amount contributed by officials is sufficient to finance one third of the benefits payable under the pension scheme. The determination of the number of years’ pensionable service credited when transferring pension rights acquired before entry into the service of the Communities pursuant to Article 11(2) of Annex VIII to the Staff Regulations is designed to establish, on the basis of an actuarial assessment, the value, in terms of entitlement to future benefits, of the capital transferred to the Community budget in the case of each individual official concerned. They are therefore two entirely separate operations carried out for different purposes.

(see para. 84)