Before the Court of Justice of the European Communities (2nd Chamber) ECJ (2nd Chamber)

Transcription

1 A. J. M. Van Roosmalen v. Bestuur Van de Bedrijfsvereniging voor de Gezondheit, Geestelijke en Maatschappelijke Belangen (Board of the Trade Council for Health, Spiritual and Social Work) (Case 300/84) Before the Court of Justice of the European Communities (2nd Chamber) ECJ (2nd Chamber) (Presiding, Bahlmann P.C.; Schockweiler and Due JJ.) M. Marco Darmon, Advocate General. 23 October 1986 Reference from the Netherlands by the Raad Van Beroep (Social Security Court), Utrecht, under Article 177 EEC. Social security. Self-employed. In the context of a social insurance scheme covering self-employed persons and covered by Article 1 of Regulation 1408/71 as amended, the question whether or not a person is self-employed is determined by the type of his activity. Such activity must be an occupation but he does not have to receive remuneration as a direct reward for it. It is sufficient if he receives in respect of it income which permits him to meet all or some of his needs, even if that income is supplied by third parties benefiting from his services, as in the case of a missionary priest. [22] Social security. Place of work. National social security legislation covered by Regulation 1408/71 within the meaning of Article 2 includes rules applicable to qualified persons whether or not their occupational activities have been carried out wholly or partly outside the Community (in casu, missionary work in a developing country). [31] Social security. Self-employed. Residence requirement.

2 Under Article 2 of Regulation 1390/81 a person who resides or has stayed in another member-state is to be treated as residing or as having stayed in the member-state of claim, but only as from 1 July 1982 when that provision came into force. [37] & [40] The Court interpreted Articles 1(a)(iv) and 2 of Regulation 1408/71 and Article 2(4) of Regulation 1390/81 in the context of a Dutch missionary priest who lived intermittently on leave in the *472 Netherlands but worked as a missionary in Zaire and on retirement for health reasons lived for a few months in the Netherlands and then permanently in a monastery in Belgium, to the effect that he came within the category of self-employed even though he was supported by his parishioners and not by his religious Order, that the regulations applied to the Dutch social security rules even in so far as the latter governed his work outside the territory of the Community in Zaire, and that he could enjoy the benefit of the Dutch rules even though he was resident in Belgium, but only as from the date when Article 2(4) of Regulation 1390/81 came into force. Representation E. F. Jacobs, Acting Secretary General of the Ministry of Foreign Affairs, for the Dutch Government as amicus curiae. Joseph Griesmar, Legal Adviser to the E.C. Commission, assisted by Francis Herbert, of the Brussels Bar, with them in the oral proceedings, R. Cornelissen, in the capacity of an expert, for the Commission as amicus curiae. The following cases were referred to in the judgment: 1. Bozzone v. Office de Securite Sociale d'outre-mer (87/76), 31 March 1977: [1977] E.C.R. 687, [1977] 2 C.M.L.R Gaz:87/76 2. Bestuur der Sociale Verzekeringsbank v. Smeija (51/73), 7 November 1973: [1973] E.C.R. 1213, [1974] 1 C.M.L.R Gaz:51/73 3. Caracciolo (Camera) v. Institut National d'assurance Maladie-Invalidite (INAMI) (92/81), 10 June 1982: [1982] E.C.R Gaz:92/81 The following further cases were referred to by the Advocate General: 4. Brack v. Insurance Officer (17/76), 29 September 1976: [1976] E.C.R. 1429, [1976] 2 C.M.L.R Gaz:17/76 5. Unger (Hoekstra) v. Bestuur der Bedrijfsvereniging voor Detailhandel en Ambachten (75/63), 19 March 1964: [1974] E.C.R. 177, [1964] C.M.L.R Gaz:75/63 6. De Cicco v. Landesversicherungsanstalt Schwaben (19/68), 19 December 1968: [1968] E.C.R. 473, [1969] C.M.L.R. 67. Gaz:19/68 7. Re Benefits for Ex-Colonial Workers: E.C. Commission v. Belgium (150/79), 11 July 1980: [1980] E.C.R. 2621, [1981] 1 C.M.L.R Gaz:150/79 8. Spruyt v. Bestuur Van der Soziale Verzerkeringsbank (284/84), 25 February 1986: [1986] E.C.R Gaz:284/84

3 9. Ten Holder v. Nieuwe Algemene Bedrijfsvereniging (302/84), 12 June 1986: [1986] E.C.R. 1821, [1987] 2 C.M.L.R Gaz:302/84 TABULAR OR GRAPHIC MATERIAL SET FORTH AT THIS POINT IS NOT DISPLAYABLE *473 Opinion of the Advocate General (M. Marco Darmon) 1 Father van Roosmalen is a Dutch priest attached to a monastery at Postel in Belgium who was sent to Zaire as a missionary in In 1977, he took out voluntary insurance, provided for under section 77 of the Arbeidsongeschiktheidswet (Incapacity for Work Act), [FN1] for persons pursuing activities in a developing country. FN1 [1975] Staatsblad 674. In 1981, he became incapacitated in Zaire as a result of illness and in October of the same year applied for the benefits provided for in such a case by the Incapacity for Work Act. He was initially granted those benefits with effect from 12 January 1982 but they were definitively withdrawn, with effect from 1 December 1982, by a decision of 8 December taken by the competent social security institution, which is the defendant in the main proceedings. That decision was based on the provisions of section 10 of the Royal Decree of 19 November 1976 implementing section 77 of the Incapacity for Work Act, [FN2] which provides, inter alia, that: A person who is regarded as insured shall become entitled to invalidity benefits provided that he has been incapacitated for work in the Netherlands for a continuous period of 52 weeks and if the incapacity for work continues at the end of that period. FN2 [1976] Staatsblad 622. However, as may be seen from the order of the Raad van Beroep, Utrecht, referring the case to the Court, the defendant institution considered that Father van Roosmalen did not fulfil that condition since he had taken up permanent residence at Postel on 2 July 1982, having made regular visits there since March The Dutch court is unsure whether the abovementioned residence requirement is in conformity with Community law. Its first question is therefore whether such a requirement constitutes an obstacle to the free movement of persons, as laid down both by Articles 52 and 53 of the Treaty and by other provisions of Community law, inasmuch as, after the risk has

4 materalised, it requires the person covered by voluntary insurance and returning from a developing country to take up residence in *474 the Netherlands and to remain there continuously for 52 weeks without being able to stay in or move to another member-state. In its second, third and fourth questions, the Dutch court also seeks guidance as to the meaning of the expression 'self-employed person' in order to determine whether the plaintiff in the main proceedings may, having regard to the nature of his activities and the scope ratione personae of the Incapacity for Work Act, rely on the provisions of Article 1(a)(ii) or (iv) of Council Regulation 1408/71 on the application of social security schemes to employed persons and their families moving within the Community, as amended by Council Regulation 1390/81 extending to self-employed persons and members of their families Regulation 1408/71. In its fifth question, the Dutch court, noting that section 77 of the Incapacity for Work Act, which applies to the plaintiff, takes into account for the purpose of the grant of invalidity benefits activities pursued outside the territory of the Community, asks the Court whether the Incapacity for Work Act may for that reason be regarded as 'legislation' within the meaning of Article 2 of Regulation 1408/71 and, if so, whether an employed or self-employed person who has been exclusively subject to that legislation in respect of activities pursued outside the territory of the European Economic Community may claim the protection afforded by [that] regulation... The last question is essentially whether the requirement that the claimant must have resided in the Netherlands for a one-year period preceding the decision to award benefits is covered by the provisions of Article 2(4) of Regulation 1390/81 which deals in particular with the waiving of residence requirements during the transitional period following the entry into force of the regulation on 1 July 1982 (Article 4). 3 Those six questions raise the following point: May a Community citizen defeat a residence requirement which must be fulfilled in order to qualify for the invalidity benefits provided for under the legislation of a member-state concerning incapacity for work by relying on the provisions of Regulation 1408/71, as extended since 1 July 1982 by Regulation 1390/81 to self-employed persons? Summed up in that way, the questions referred to the Court require an explanation and make a particular approach necessary. Like the Commission, I believe that the reply to the first question necessarily follows from the reply to the last question. Regulation 1408/71, as amended by Regulation 1390/81, was adopted in order to implement the provisions of Articles 51 et seq. EEC so that the question whether the residence requirement may *475 be relied upon as against the plaintiff must be assessed in the light of all of those provisions. However, given the special circumstances of the case, consideration should first be given to the question whether Father van Roosmalen is entitled to rely on the abovementioned regulation. Although the Dutch legislation comes within the

5 scope ratione materiae of Regulation 1408/71 as a branch of social security concerning invalidity benefits (Article 4(1)(b) and Annex VI, Part I. Netherlands, section 4), it is clear from the grounds of the order for reference that the national court is not sure whether Father van Roosmalen is a person covered by the regulation, as defined in Article 2(1), which states that: This Regulation shall apply to employed or self-employed persons 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... More precisely, the national court, having regard to the plaintiff's particular occupation, is unsure whether he is a 'self-employed person' within the meaning of Article 1(a) of Regulation 1408/71 (Questions 2, 3 and 4). It is also unsure whether he may be regarded as subject to the legislation of a member-state, within the meaning of the aforementioned provision and Article 1(j) of the regulation when the Incapacity for Work Act takes account of activities pursued outside the geographical territory of the Community. Thus it is only after those points have been resolved that it might still be necessary to consider whether the contested residence requirement is compatible with secondary Community law. The expression 'self-employed person' 4 As the Commission has observed, the Incapacity for Work Act makes the right to benefits conditional upon the claimant's having pursued during the year preceding the occurrence of the event insured against 'an activity or profession' in respect of which he received 'income'. In Dutch revenue law, ' income' is not strictly limited to earnings from employment, a business or the exercise of an independent profession, but covers more generally--to cite the national court's words in the third question--income from work performed in economic life which is intended to provide, or, according to the rules prevailing in society, can reasonably be expected to provide, some pecuniary advantage. The effect of that definition is to extend the benefit of the Incapacity for Work Act from employed and 'genuinely' self-employed persons to a residual category of 'quasi-self-employed' persons. The national court is unsure whether the latter category *476 of persons may be regarded as 'self-employed persons' within the meaning of Regulation 1408/71. That is the context in which Questions 2 to 4, concerning the expression ' selfemployed person', must be read. Before analysing, as the Commission has done, the meaning and structure of the relevant provisions of Regulation 1408/71, it is necessary to recall that the regulation must be interpreted in the light of the spirit in which it was drafted and of the objectives of the Treaty which it was intended to attain (Case 17/76, Brack v. Insurance Officer [FN3]). FN3 [1976] E.C.R. 1429, [1976] 2 C.M.L.R. 592 at para. [19]. In this regard the Court has consistently taken the view that the Community rules on social security

6 follow a general tendency of the social law of member-states to extend the benefits of social security in favour of new categories of persons by reason of identical risks. [FN4] FN4 Ibid. at para. [20]. Accordingly, as Mayras A.G. stated in his Opinion in Brack, [FN5] the social-cumoccupational criteria on the basis of which the distinction is made between employed and self-employed persons must not, having regard to the objective which Article 51 EEC seeks to achieve, namely 'the establishment of as complete a freedom of movement for workers as possible' (Case 75/63, Hoekstra v. Bedrijfsvereniging voor Detailhandel en Ambachten [FN6]), be understood only in 'a narrow sense'. Gand A.G. likewise stated with regard to Regulation 3, which applied before the adoption of Regulation 1408/71, that the sphere of application of the regulation is determined by a criterion of social security and not of labour legislation... [FN7] FN5 At p (E.C.R.), p. 606 (C.M.L.R.). FN6 [1964] E.C.R. 177 at 184, [1964] C.M.L.R. 319 at 330. FN7 Case 19/68, De Cicco v. Landesversicherungsanstalt Schwaben: [1968] E.C.R. 473 at 484, [1969] C.M.L.R. 67 at 70. That is why, in conformity with the Community meaning required by the Treaty itself, the concept of 'employed or self-employed person' must cover, according to the definition given in Hoekstra, the leading case, all those who, as such and under whatever description, are covered by the different national systems of social security. [FN8] FN8 [1964] E.C.R. at p. 185, [1964] C.M.L.R. 319 at 330. It is therefore by being covered by the social security system of a member-state and not because of how the occupation in question is classified under national law that a Community citizen becomes 'moored' to Regulation 1408/71. However, it is common ground in this case that the claimant was insured under the Incapacity for Work Art which, as I have pointed out, falls within the scope ratione materiae of Regulation 1408/71. *477 5 Consequently the interpretation of the expression 'self-employed person' is not decisive for the application of the Community protection. None the less, if that expression, which the national court asks this Court to interpret, is to be of some value to it in resolving the dispute before it, the following observations should be made. In my view, the expression should be given a wide meaning. This follows from

7 both the Court's previous decisions, referred to above, and the actual provisions of Regulation 1408/71. In the present case, where a person who is voluntarily insured for one or more of the contingencies covered by the branches dealt with in this Regulation, under a social security scheme of a member-state for employed or self-employed persons or for all residents or for certain categories of residents Article 1(a)(iv) of the regulation provides that: 'employed person' and 'self-employed person' mean respectively: (...) [any] person [who] carries out an activity as an employed or self-employed person... As far as self-employed persons are concerned, that definition, which the Commission described as 'tautological' refers generally, as it has shown, to persons carrying on an independent activity. Like the national court, the Netherlands and the Commission, one is therefore prompted to seek more precise criteria in the other provisions of Article 1(a) of Regulation 1408/71. The need for a uniform interpretation justifies such a step. In actual fact, only Article 1(a)(ii), concerning compulsory insurance, provides more serviceable criteria. It refers to the manner in which the applicable social security scheme is administered or financed in so far as it makes it possible to identify the claimant as an employed or self-employed person and, 'failing such criteria', to the definition given in Annex I, in which the Community legislature, according to the final recital in the preamble to Regulation 1390/81, considered it 'necessary to stipulate... what the terms "employed person" and "self-employed person", introduced in Regulation 1408/71, mean when the person concerned is insured under a social security scheme which applies to all residents or to certain categories of resident or to the entire working population of a member-state...." As far as concerns the Netherlands, it is stated in Part I of that Annex that: Any person pursuing an activity or occupation without a contract of employment shall be considered a self-employed person within the meaning of Article 1(a)(ii) of the Regulation. *478 In that regard, the comparative analysis carried out by the Commission of the various language versions of that provision leads to a broad interpretation. That definition therefore covers not only occupational activities (the literal meaning of the Dutch language version) but, more generally, any activity pursued without a contract of employment, provided that it is remunerated. Employed and self-employed persons have in common the fact that they receive an income in return for the work performed. Consequently, there is no reason why persons who, without any contract of employment, have pursued an activity in return for which they have received income within the meaning of Dutch revenue law, other than income from the exercise of an independent profession or from running a private business, should not be regarded as 'self-employed persons'. The term 'legislation'

8 6 Section 77 of the Incapacity for Work Act extends the right to insure oneself to those who have pursued or are pursuing 'activities in a country which... may be regarded as a developing country'. Do persons so insured under legislation which takes account of activities pursued in States forming no part of the territory of the Community, as defined in Article 227 EEC, come within the scope ratione personae of Regulation 1408/71, as defined in Article 2(1) and Article 1(j) of that regulation, which states that: 'legislation' means in respect of each member-state statutes, regulations and other provisions and all other implementing measures, present or future, relating to the branches and schemes of social security covered by Article 4(1) and (2)? The reply to that question must be in the affirmative. I agree with Capotorti A.G. that: In order to define the scope of Regulation 1408/71 decisive weight should be conferred, not upon the criterion of the locality where the person was employed, but on the criterion of the relationship between the worker, wherever he was or is still employed, and the social security organisation of a member-state. The Advocate General also stated: [That view] does not mean that the benefit of the Community rules is extended to insurance periods completed under the social security system of a non-member country but merely that decisive weight is given to the fact that the insurance periods were completed within the framework of a social security scheme established by a member-state. [FN9] FN9 Case 87/76 Bozzone v. Office de Securite Sociale D'Outre-MER: [1977] E.C.R. 687 at 706, [1977] 2 C.M.L.R. 604 at 616. *479 In Bozzone, the Court followed the Opinion of its Advocate General whilst in Case 150/79, E.C. Commission v. Belgium, [FN10] the Court confirmed that judgment. It held, with regard to Belgian legislation placing under the control and guarantee of the Belgian State the institutions administering social security for workers from the Belgian Congo and Ruanda Urundi..., [FN11] FN10 [1980] E.C.R. 2621, [1981] 1 C.M.L.R FN11 Para. [2]. that such a scheme introduced by a Belgian law and administered under the control of the Belgian State by a public body subject to Belgian law the effects of which are produced, in general, not in the former Belgian colonies but principally in the Belgian metropolitan territory... is capable of affecting the movement of workers within the Community, the freedom of which is ensured by Articles 48 to 51 of the Treaty and by Community regulations.

9 The Court concluded that: in the circumstances, the mere fact that all the payments are based on periods of insurance completed prior to 1 July 1960 outside Community territory does not prevent the Community regulations on social security from applying. [FN12] FN12 Para. [7]. Consequently it is necessary to take the view that the Dutch legislation on incapacity for work, which in section 77 is stated to be applicable to persons having pursued an activity in a developing country, constitutes ' legislation' within the meaning of Articles 1(j) and 2(1); moreover, the social security scheme established thereunder is administered under the control of the State by a body subject to Dutch law. That institutional connecting factor constitutes the decisive criterion for the application of Regulation 1408/71 so that it is of little importance whether or not the insured person pursued his activities exclusively in a non-member country. From that point of view, the special links between that country and the member- State itself, characteristic of the relationship between Belgium and its former colonies in the two cases cited above, does not affect that conclusion. Although the Court referred to the existence of those links in its decision in Bozzone, neither in that decision nor, more especially, in the judgment in Case 150/79 declaring Belgium in breach of its obligations, was it the special nature of the links between the two States concerned which led to the Belgian Law being regarded as 'legislation' within the meaning of Regulation 1408/71. I therefore consider that the Dutch provision at issue must be regarded as ' legislation' within the meaning of Article 2(1) of Regulation 1408/71. *480 The residence requirement 7 It therefore remains to consider whether the contested residence requirement--a claimant must have been 'incapacitated for work in the Netherlands for an uninterrupted period of 52 weeks'--is compatible with Article 2(4) of Regulation 1390/81, which provides that: Any benefit which has not been awarded or which has been suspended by reason of the nationality or place of residence of the person concerned shall, on the application of the person concerned, be awarded or resumed with effect from the entry into force of this Regulation..., that is to say, from 1 July 1982 (Article 4). The purpose of that provision was to permit persons covered by the Community regulations at issue to obtain, from that date, social security benefits the award of which they had been refused or, after they were awarded, were suspended 'by reason of the nationality or place of residence of the person concerned'. In that regard, the Dutch court raises the question whether the aforementioned residence requirement, to which the very existence of the right to invalidity benefit is subject, is deprived of effect by Article 2(4) even though that provision

10 appears to apply only to the case in which the insured person's pension is not awarded or payment of the benefits related thereto is refused after he has transferred his residence to a member State other than that in which the institution paying the benefit is located. As the Netherlands and the Commission observe, that question raises the question of the scope of the principle concerning the 'waiving of residence clauses'; that principle is set out in Article 10(1) of Regulation 1408/71 and Article 2(4) of Regulation 1390/81 merely applies it to a transitional period. More precisely, the question is whether that provision concerns a condition for the acquisition of the right or merely for its implementation or its maintenance. In this regard, Article 10(1) of Regulation 1408/71, which essentially contains the previous provisions of Regulation 3, provides as follows: Save as otherwise provided in this Regulation, invalidity... pensions... acquired under the legislation of one or more member-states shall not be subject to any reduction, modification, suspension, withdrawal or confiscation by reason of the fact that the recipient resides in the territory of a member-state other than that in which the institution responsible for payment is situated [my italics]. The Court has already ruled on the meaning of the word 'acquired' in that Article. In its judgment in Soziale Verzekeringsbank v. Smieja, [FN13] the Court stated that the purpose of that provision is *481 to promote the free movement of workers, by insulating those concerned from the harmful consequences which might result when they transfer their residence from one member-state to another. FN13 Case 51/73: [1973] E.C.R. 1213, [1974] 1 C.M.L.R. 620 at para. [20]. Consequently, the Court decided in its judgment in Caracciolo v. INAMI [FN14] that: It is clear from that principle not only that the person concerned retains the right to receive pensions and benefits acquired under the legislation of one or more member-states even after taking up residence in another member-state, but also that he may not be prevented from acquiring such a right merely because he does not reside in the territory of the State in which the institution responsible for payment is situated [my italics]. FN14 Case 92/81: [1982] E.C.R at para. [14]. That result is determined by the provisions of Article 51 EEC, the purpose of which, according to the Court's recent judgment in Spruyt v. Bestuur Van der Soziale Verzekeringsbank, [FN15] is to contribute to the establishment of the greatest possible freedom of movement for migrant workers, which is one of the foundations of the Community. FN15 Case 284/84; [1986] E.C.R. 685 at paras. [18] & [19]. The Court added that:

11 The aim of Article 48 to 51 would not be attained if, as a consequence of the exercise of their right to freedom of movement, workers were to lose the advantages in the field of social security guaranteed to them by the laws of a single member-state. Thus, the Court's decisions require in principle the waiving of all residence clauses on which depend not only the maintenance of benefits already acquired but also whether entitlement to those benefits arises at all. That is the context in which Article 2(4) of Regulation 1390/81 must be read: it makes it impossible to rely on the provisions of Article 2(1), according to which no right shall be acquired under this Regulation in respect of a period prior to the date of its entry into force, as against self-employed persons whose right to benefit arose before 1 July 1982 if they satisfied the residence requirement and permits them to take advantage, from that date, of the provisions of Article 10 of Regulation 1408/71, as interpreted by the Court. However, let me make two observations. So construed, that principle, as Article 10(1) itself expressly provides, may be modified in certain respects. For example, Annex VI to Regulation 1408/71 on 'special procedures for applying the legislation of certain member-states' provides, with regard to Germany (Section C 1), that: The provisions of Article 10 of the regulation shall not affect the provisions under which accidents (and occupational diseases) occurring outside the territory of the Federal Republic of Germany, and periods *482 completed outside that territory, do not give rise to payment of benefits, or only give rise to payment of benefits under certain conditions, when those entitled to them reside outside the territory of the Federal Republic of Germany. On the other hand, with regard to the 'Application of the Dutch legislation on insurance against incapacity for work', referred to in Annex VI, Part I, Netherlands, section 4, no exception of that type is provided for. In the absence of such an exception, the general principle laid down in Article 10(1) must be applied. [FN16] FN16 Case 87/76,Bozzone, paras. [18] and [19], Opinion of Capotorti A.G., p. 707 (E.L.R.), p. 617 (C.M.L.R.), Case 150/79, E.C. Commission v. Belgium, para. [9] and Opinion of Caportorti A.G., p (E.C.R.), p. 425 (C.M.L.R.). The solution which I propose does not appear to be at odds with that proposed by Slynn A.G. in his Opinion in Case 302/84, Ten Holder v. Nieuwe Algemene Bedrijfsvereniging, [FN17] concerning a residence requirement of the same type provided for in a transitional provision of the Incpacity for Work Act. In that case, the plaintiff was already compulsorily insured in the Federal Republic of Germany when she joined the voluntary insurance scheme provided for by the Incapacity for Work Act. In such a situation, the voluntary insurance is merely additional and is therefore excluded from the scope of Regulation 1408/71 by Article 13 thereof which provides that... persons to whom this Regulation applies shall be subject to the legislation of a

12 single member-state only... [my italics]. FN17 [1986] E.C.R. 1821, [1987] 2 C.M.L.R In the light of all the foregoing considerations, I propose that the Court reply as follows to the questions referred to it by the Raad van Beroep, Utrecht: 1. Regulation 1408/71 applies to nationals of member-states receiving invalidity benefits provided for under the Netherlands legislation on incapacity for work. In accordance with the provisions of Article 1(a)(ii) and (iv) and Annex I, Part I, Netherlands, of Regulation 1408/71 the expression 'self-employed person' must be interpreted as including any person who has pursued, without a contract of employment, an activity or occupation in respect of which he has received income, within the meaning of the Dutch legislation, other than income obtained from running a private business or from the exercise of an independent profession within the meaning of the same legislation. 2. Legislation of a member-state which, for the award of social security benefits to be paid by the competent national institution, also takes account of activities which insured persons covered by that legislation have pursued, either *483 wholly or in part, in a non-member country must be regarded as ' legislation' within the meaning of Regulation 1408/ Article 2(4) of Regulation 1390/81 applies to the refusal by the institution responsible for providing benefits to award an invalidity benefit on the ground that the claimant has not resided in the member-state concerned for a continuous period of 52 weeks. JUDGMENT [1] By order of 11 December 1984, which was received at the Court on 19 December 1984, the Raad van Beroep, Utrecht, referred to the Court for a preliminary ruling under Article 177 EEC six questions on the interpretation of Articles 52 and 53 of the Treaty, as well as certain provisions of Council Regulation 1408/71 on the application of social security schemes to employed persons and their families moving within the Community and of Council Regulation 1390/18 extending Regulation 1408/71 to self-employed persons and their families. [2] Those questions arose in proceedings between A. J. M. Van Roosmalen, plaintiff, and the Bestuur van de Bedrijfsvereniging voor de Gezondheid, Geestelijke en Maatschappelijke Belangen, Zeist (Netherlands), defendant, concerning the refusal of the latter to award the plaintiff an invalidity pension under the Algemene Arbeidsongeschiktheidswet (General Law on Incapacity for Work, hereinafter referred to as 'the Statute on Incapacity'). [FN18] FN18 [1975] Staatsblad 674. [3] As can be seen from the order for reference, the plaintiff, a Roman Catholic

13 priest belonging to the Premonstratensian (Norbertine) Order, is of Dutch nationality and comes from the Dutch municipality of Oost-West-en-Middelbeers, in which he lived until December He then went to live in Postel (Belgium), situated immediately on the other side of the frontier between the Netherlands and Belgium, in order to pursue his studies in a monastery belonging to his Order and was therefore removed from the Register of Inhabitants of Oost-West-en- Middelbeers. Between 1955 and 1980, he was a missionary in the Belgian Congo, which in 1960 became Zaire. [4] Whilst on leave in the Netherlands in 1977 and 1980, the plaintiff again had his name entered in the Register of Inhabitants for Oost-West-en-Middelbeers. It should be pointed out that during his stay in Zaire, the plaintiff was not subject to income tax in the Netherlands but was subject to it during the periods spent on leave in the Netherlands in respect of benefits paid to him under the Algemene Bijstandswet (General Law on Assistance). [FN19] FN19 [1963] Staatsblad 284 *484. [5] In 1977, whilst on leave in Oost-West-en-Middelbeers, the plaintiff registered for the voluntary insurance introduced for persons pursuing an activity in a developing country by section 77 of the Statute on Incapacity, which came into force on 1 October Under that statute, all persons residing in the European territory of the Kingdom of the Netherlands are in principle insured. However, section 77 provides that persons formerly insured, and also persons who resided in the Netherlands before 1 October 1976 and after reaching the age of 15 years, are authorised to pay contributions in respect of periods in which they are uninsured, if they leave to pursue an activity in a developing country. Zaire is regarded as a developing country. According to section 13 of the Royal Decree of 19 November 1976, [FN20] implementing section 77 of the Statute on Incapacity, the right to pay voluntary insurance contributions under the State on Incapacity also applies to persons who were already pursuing an activity in a developing country on 1 October 1976 and who resided in the Netherlands after the age of 15 years. FN20 [1976] Staatsblad 622. [6] The plaintiff contracted an illness in Zaire which left him incapacitated for work and he returned in March 1981 to Oost-West-en-Middelbeers, whereupon he received from the defendant invalidity benefits under the Statute on Incapacity with effect from 12 January However, when the defendant became aware that the plaintiff had settled in Postel on a permanent basis on 2 July 1982, it suspended, by a decision of 8 December 1982, payment of those benefits with effect from 1 December 1982 on the ground that the plaintiff had not fulfilled the residence requirement laid down in section 10 of the abovementioned Royal Decree of 19 November [7] That provision reads as follows: 1. Notwithstanding section 6 of this Act, a person who is regarded as insured

14 shall become entitled to invalidity benefits only after he has been incapacitated for work in the Netherlands for a continuous period of 52 weeks and if the incapacity for work continues after the end of that period. 2. If it can be established to the satisfaction of the professional and trade association that the person regarded as insured became inacapacitated for work at a date prior to that on which he returned to the Netherlands, that person is entitled to invalidity benefits after he has been incapacitated for work for a continuous period of 52 weeks since that date, provided that the incapacity for work continues after the end of that period; however, such benefits shall in no circumstances be paid before the date on which that person returned to the Netherlands. [8] Since the Raad van Beroep, Utrecht, before which the plaintiff had brought an action for the annulment of the abovementioned decision, had serious doubts as to the compatibility *485 of that residence requirement with Community law, it referred, by order of 11 December 1984, the following questions to the Court of Justice for a preliminary ruling: 1. Must Article 52 or 53 of the Treaty establishing the European Economic Community or any other provision of Community law be interpreted in the sense that it is necessary to consider incompatible therewith the adoption by a member- State of legislation which inter alia offers nationals of that State the opportunity to insure themselves on a voluntary basis against the financial consequences of incapacity for work arising in the course of employment in a developing country outside the territory of the Community, if such legislation contains, for the purpose of verification, an additional condition as regards entitlement to benefits to the effect that the person concerned must, after the materialisation of the contingency insured against, have resided or stayed for a continuous period of 52 weeks within the territory of that member-state alone in order to be entitled to benefits, residence or stay within the territory of another member-state after the materialisation of the contingency insured against not being treated as equivalent to residence or stay in the first-named member-state? 2. May the criteria set out in Article 1(a)(ii) of Regulation 1408/71, including those set out in Annex I thereto, also be applied in order to determine whether a person within the meaning of Article 1(a)(iv) 'carries out an activity as an employed or self-employed person' under a social security scheme for residents, or does that phrase have another, independent meaning and, if so, what? 3. Does the expression 'self-employed person' as defined inter alia in Article 1(a)(ii) of Regulation 1408/71, also include a person who under a social security scheme for all residents can derive entitlement to benefits on the basis of income from work, other than income from employment or from a profession or trade engaged in on a self-employed basis within the meaning of the national legislation? 4. Does the expression 'self-employed person', as defined inter alia in Article 1(a)(ii) of Regulation 1408/71, or the phrase 'carries out an activity as a... selfemployed person' in Article 1(a)(iv) also include a person who can be voluntarily insured, whether continuously or otherwise, under a social security scheme for all residents who pursue an activity, even though that person cannot be regarded as

15 an employed person or as a self-employed person within the meaning of the relevant national legislation but enjoys by virtue of such voluntary insurance the same degree of protectoin as a 'real' employed or self-employed person? 5. Is legislation which in scope applies to areas outside the territory of the Community to be regarded as 'legislation' within the meaning of Article 2 of Regulation 1408/71? If that question is answered in the affirmative, does this mean that an employed or self-employed person who has been exclusively subject to that legislation in respect of activities pursued outside the territory of the Community may claim the protection afforded by Regulation 1408/71? 6. If on the basis of a provision of national legislation the award of benefits to a person is refused on the ground that he was not incapacitated for work in the member-state in question for a continuous period of 52 weeks, does this mean that benefits have *486 not been awarded by reason of the place of residence, within the meaning of Article 2(4) of Regulation 1390/81? Would the answer to this question be different if the phrase ' incapacitated for work in the member-state in question' were interpreted as meaning that the person concerned must have had a place of residence in that member-state? [9] By a decision of 26 November 1985, the Court assigned the case to the Second Chamber. [10] The Dutch Government and the E.C. Commission have submitted written observations to the Court. [11] The national court has submitted a series of questions related to the principal issue of whether a residence requirement, constituting a condition for the award of an invalidity benefit, is, in the circumstances of this case, compatible with Community law. In order to reply to that point, which is raised in the first and sixth questions, it is first necessary to consider the preliminary points referred to in the remaining questions, concerning the definition of the terms 'self-employed person' and 'legislation' within the meaning of Regulation 1408/71, as amended by Regulation 1390/81. [12] Reference is made to the Report for the Hearing for the relevant Dutch provisions and for the facts and submissions and arguments of the parties, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court. Definition of the term 'self-employed person' (second to fourth questions) [13] The national court wishes to know whether persons who pursue, otherwise than under a contract of employment or by way of self-employment in a trade or profession, an activitiy of any kind in respect of which they receive income may be regarded as 'self-employed persons' within the meaning of Regulation 1408/71, as amended by Regulation 1390/81, in order to determine whether a priest who is not paid by his Order but is maintained by his parishioners comes within the scope of that term. [14] In that regard, the national court observes that in Dutch tax law the expression 'income from work' refers to work performed in economic life which is

16 intended to provide, or, according to the rules prevailing in society, can reasonably be expected to provide, some pecuniary advantage. [15] The Dutch Government observes that, under Section I of Annex I to Regulation 1408/71, the term 'self-employed person' must be interpreted in regard to the Netherlands as meaning 'any person pursuing an activity or occupation without a contract of employment'. It is not therefore necessary that the person's income should come from an employment relationship or from selfemployment in a trade or profession within the meaning of national *487 law. Consequently, the term even extends to persons who, in the context of a social security scheme applying to all residents, may be permitted to join the scheme on a voluntary basis, in respect of the exercise of any activity, even if they cannot be regarded as employed persons or self-employed persons within the meaning of national law. [16] However, the Dutch Government points out that, although its social security legislation does not distinguish between the different categories of insured person, a distinction is drawn in certain cases under the Statute on Incapacity between persons who are compulsorily insured and those who are insured on a voluntary basis, inasmuch as additional conditions for obtaining the right to benefits are laid down. [17] The Commission also considers that the expression 'self-employed person' cannot be limited to persons who engage in a trade or profession on a selfemployed basis within the meaning of national law, but in fact refers to any person who, in the context of a social security scheme applying to all residents, is entitled to benefits on the basis of income from work performed in economic life which is intended to provide, or, according to the rules prevailing in society, can reasonably be expected to provide, a pecuniary advantage. [18] With regard to the interpretation of the expression 'self-employed person', it must first be pointed out that initially the provisions of Regulation 1408/71, adopted for the implementation of Article 51 of the Treaty, applied only to those who were covered by the term 'employed person'. According to the established case law of the Court, 'employed person' is a term of Community law rather than national law and must be interpreted broadly, having regard to the objective of Article 51, which is to contribute towards the establishment of the greatest possible freedom of movement for migrant workers, an objective which is one of the foundations of the Community. [19] In the preamble to Regulation 1390/81 the Council stated that freedom of movement for persons was not confined to employed persons but also extended to self-employed persons in the framework of freedom of establishment and the freedom to provide services and that co-ordination of the social security schemes applicable to self-employed persons was necessary to achieve one of the objectives of the Community; consequently, in that regulation it extended the general scope of Regulation 1408/71 to self-employed persons and members of their family. [20] Since Regulation 1390/81 was adopted in order to achieve the same objectives as Regulation 1408/71, the concept of 'self-employed person' is intended to guarantee to such persons the same protection as is accorded to

17 employed persons and must therefore be interpreted broadly. *488 [21] In regard, more particularly, to the definition of the expression 'selfemployed person', it must be observed that according to Article 1(a)(iv) of Regulation 1408/71, as amended by Regulation 1390/81, that expression means, in the case of persons who, like the plaintiff, are voluntarily insured, any person who 'carries out an activity as [a] self-employed person'. With respect to persons who are compulsorily insured, Article 1(a)(ii) refers in that regard either to the manner in which the applicable social security scheme is administered or financed or, in the alternative, to the definition given in Annex I to the regulation. According to Section I of that annex, which is exclusively concerned with the Netherlands, a self-employed person within the meaning of the abovementioned Article means 'any person pursuing an activity or occupation without a contract of employment'. [22] Consequently, in the context of a voluntary social insurance scheme set up for employed persons, self-employed persons or all residents, the question whether or not a person is 'self-employed' is determined by the type of activity which he pursues or has pursued, and the activity cannot be an activity of any kind but must be an occupation. However, having regard to the broad interpretation which must be given to that term, it is not necessary that the selfemployed person should receive remuneration as a direct reward for his activity. It is sufficient if he receives, in respect of that activity, income which permits him to meet all or some of his needs even if that income is supplied, as in this case, by third parties benefiting from the services of a missionary priest. [23] Consequently, the reply to the national court must be that the expression 'self-employed person' within the meaning of Article 1(a)(iv) of Regulation 1408/71, as amended by Regulation 1390/81, applies to persons who are pursuing or have pursued, otherwise than under a contract of employment or by way of self-employment in a trade or profession, an occupation in respect of which they receive income permitting them to meet all or some of their needs, even if that income is supplied by third parties benefiting from the services of a missionary priest. The term 'legislation' (fifth question) [24] In this question, the national court wishes to know whether national social security rules, such as those contained in the Statute on Incapacity, which apply to persons who are pursuing or have pursued activities partly or wholly outside the Community may be regarded as 'legislation' within the meaning of Article 2 of Regulation 1408/71. [25] The Dutch Government considers that Regulation 1408/71 places no territorial limitation on the scope of national legislation and therefore makes it possible to bring within the scope of such legislation territories situated outside the Community. Even an *489 employed person who has been subject to that legislation solely on the basis of activities pursued outside the Community will therefore, in principle, come within the scope of the regulation. However, if it is expressly provided that applicability of that legislation depends on residence in a

18 territory forming part of the Community, such a person cannot rely on it. [26] The Commission contends that the fact that national social security legislation makes it possible to be insured on the basis of an activity pursued in a non-member country and confers the right to the corresponding social benefits is sufficient to bring the persons insured within the scope of Regulation 1408/71. Consequently, Regulation 1408/71 also applies to persons receiving benefits provided for in the legislation of a member-state in respect of activities pursued by a national of a member-state exclusively outside the territory of the Community. [27] Attention must first be drawn to the fact that according to the definition contained in the first subparagraph of Article 1(j) of Regulation 1408/71, 'legislation' means in respect of each member-state statutes, regulations and other provisions and all other implementing measures, present or future, relating to the branches and schemes of social security covered by Article 4(1) and (2). [28] As the Court has already stated in Case 87/76, Bozzone v. Office de Securite Sociale d'outre-mer [FN21] that definition is remarkable for its breadth since it includes all provisions laid down by law, regulation and administrative action by the member-states and must be taken to cover all the national measures applicable in the matter. FN21 [1977] E.C.R. 687, [1977] 2 C.M.L.R [29] In the light of that consideration, the essential criterion for determining the scope of the term is not the place in which the occupation was pursued but the link which exists between the worker, regardless of the place in which he pursued or is pursuing his occupation, and the social security scheme in a member-state under which he has completed periods of insurance. [30] Since the decisive criterion for the applicability of Regulation 1408/71 is the fact that the insured person is affiliated to a social security scheme in a member- State, it is of no importance whether or not he pursued his activities exclusively outside the territory of the member-states of the Community. [31] The reply to this question must therefore be that national social security rules which apply to persons who pursue or who have pursued activities either wholly or partly outside the Community must be regarded as 'legislation' within the meaning of Article 2 of Regulation 1408/71. *490 The residence requirement (first and last questions) [32] In these questions, the national court is asking whether the provisions of the Treaty and of Article 2(4) of Regulation 1390/81 apply to a refusal by a social security institution to award an invalidity benefit on the ground that the insured person had not previously resided or stayed in the member- State concerned for a continuous specified period. [33] The Dutch Government considers that Regulation 1390/81 merely extends the scope of Regulation 1408/71 to self-employed persons without conferring upon them further rights in addition to those granted to employed persons; in