A – The first question
25. By its first question, the referring court asks the Court whether the judicial solution adopted in Miethe must still be applied under Regulation No 883/2004. Before an answer can be given, it is necessary to examine the judgment in that case more closely.
1. Miethe and its ratio decidendi
26. In Miethe, the referring court requested the interpretation of Article 71 of Regulation No 1408/71. That article, which specified which Member State was competent for payment of unemployment benefit, essentially made provision for two situations.
27. First of all, a wholly unemployed frontier worker was to receive benefit only from his State of residence ‘as though he had been subject to that legislation while last employed’.(12) Second, a wholly unemployed worker other than a frontier worker had to make himself available to the employment services of his State of residence which was required, in principle, to pay him unemployment benefit ‘as if he had last been employed there’, but that worker could also be accorded an entitlement to benefit in the Member State in which he was last employed.(13) In that case, the payment of benefit by the Member State of residence was suspended.
28. In Miethe, the question referred to the Court was whether a wholly unemployed frontier worker who has maintained particularly close personal and business links with the Member State in which he was last employed was to be regarded as coming within the scope of the first case (he was entitled to benefit only from the Member State of residence) or the second (he was entitled to benefit from the Member State of residence and the Member State of last employment).
29. To answer that question, the Court first pointed out that Article 71 of Regulation No 1408/71 was ‘intended to ensure that migrant workers receive unemployment benefit in the conditions most favourable to the search for new employment’, that benefit being ‘not merely pecuniary but includ[ing] the assistance in finding new employment which the employment services provide for workers who have made themselves available to them’.(14) The Court inferred that, in laying down the rule that a frontier worker was to be entitled to benefit from the State of residence, the Union legislature had thus assumed that ’such a worker would find in that State the conditions most favourable to the search for new employment’.(15)
30. However, at the same time, the Court acknowledged that the objective pursued could not be achieved where a wholly unemployed frontier worker ‘has in exceptional circumstances maintained in the Member State in which he was last employed personal and business links of such a nature as to give him a better chance of finding new employment there’(16) and that, in such a case, that worker therefore had to be regarded as a worker ‘other than a frontier worker’ falling within the scope of Article 71(1)(b)(ii) of Regulation No 1408/71. The Court concluded that it was for the referring court ‘to determine whether a worker who reside[d] in a Member State other than that in which he was last employed none the less continue[d] to enjoy a better chance of finding new employment in that State and … therefore [had to] come within the scope of Article 71(1)(b) of Regulation No 1408/71’.(17)
31. It is thus very clear from Miethe that the rationale for the solution adopted by the Court, almost running counter to the very wording of Article 71 of Regulation No 1408/71, was based solely on the wish to provide the worker concerned with the most favourable conditions for a return to employment. It should also be noted that the possibility, in that case, to turn to the Member State of last employment to claim payment of unemployment benefit there was available only to the category of ‘atypical frontier workers’ because of the particularly close personal and business links which they had maintained with the Member State in which they were last employed. The Court was probably permitted to depart from the letter of the regulation because it was actually based on a presumption – that the most favourable conditions for finding new employment are met in the Member State of residence – which should be regarded as rebuttable, at least in the exceptional cases referred to above. I would add, lastly, that the fact that, in Regulation No 1408/71, the State in which benefits are paid was necessarily the State in which the worker had to register in order to receive assistance from the employment services led the Court to take the view that, in the case of those atypical frontier workers, the objective of finding new employment would be achieved more easily if those workers could register with the employment services of the State in which they were last employed, which then made it necessary to establish that State’s competence for the payment of benefit.
2. The clear intention of the Union legislature to put an end to the Miethe exception
32. The question raised by the present case is therefore whether the ratio decidendi which I have just explained can justify maintaining the exception pursuant to Regulation No 883/2004.
33. It must first be stated that the European Union legislature did not opt to enshrine expressly the solution adopted by the Court in its judgment in Miethe, even though recital 21 in the preamble to Regulation No 883/2004 makes reference to the Court of Justice’s case-law, thus showing that the legislature was fully aware of the Court’s positions in this regard. Article 65 of Regulation No 883/2004 provides that a wholly unemployed frontier work receives benefit in the Member State of residence. With regard to payment of benefit, the legislature neither provided an option for the frontier worker nor laid down specific provisions governing the category of atypical frontier workers in accordance with Miethe.
34. Moreover, that provision has the completely opposite rationale to the one contained in the Commission’s initial proposal for a regulation. Under Article 51 of that proposal, a worker residing in a State other than the competent State who made himself available to the employment services of the State in which he resided was to receive the benefit provided by the competent State.(18) The legislature therefore very deliberately maintained the principle that the State of residence must provide unemployment benefit to frontier workers.
35. In fact, the innovation lies elsewhere. Article 65 decoupled the Member State which pays benefit from the Member State in which the worker may register with the employment services. More precisely, Article 65(2) of Regulation No 883/2004 provides that the frontier worker must ‘make himself available to the employment services in the Member State of residence’ and ‘may, as a supplementary step, make himself available to the employment services of the Member State in which he pursued his last activity as an employed or self-employed person’.
36. Even though it could be claimed that the legislature, while not explicitly enshrine the solution adopted in Miethe, did not expressly reject it either, when drafting Article 65 of Regulation No 883/2004, that regulation must, in any event, be interpreted in the light of Regulation (EC) No 987/2009 of the European Parliament and of the Council, which constitutes its implementing regulation. According to recital 13 in the preamble to that implementing regulation, whereas ‘[f]rontier workers who have become wholly unemployed may make themselves available to the employment services in both their country of residence and the Member State where they were last employed … they should be entitled to benefit only from their Member State of residence’.(19)
37. It is particularly striking that this recital was introduced during the legislative procedure at the request of the European Parliament, which considered that after that clarification ‘there can no longer be any misunderstanding about whether the Miethe judgment is still to be applied or not’.(20) It is thus perfectly clear that the European Union legislature did not intend the solution adopted in Miethe to continue to be applicable under the aegis of Regulation No 883/2004.
38. That being the case, the Court could overcome that manifest absence of an intention on the part of the legislature if it could be convinced that the provisions of Regulation No 883/2004 are not capable of meeting the intended objective of guaranteeing the most favourable conditions for the frontier worker to find new employment.
39. Adhering strictly to the regulatory framework established by the basic regulation (Regulation No 883/2004) and clarified by the implementing regulation (Regulation No 987/2009), the situation is as follows: a frontier worker is entitled to benefit in the Member State of residence, he is required to register with the employment services in that State and may also, if he wishes, register with the employment services in the State in which he was last employed, it being understood that priority would nevertheless be given to compliance with the worker’s obligations in the State in which benefit is paid, i.e. in his State of residence.
40. Does such an arrangement guarantee frontier workers in general, and atypical frontier workers in particular – that is, those who have maintained close personal and business links with the Member State in which they were last employed – the most favourable conditions for a return to employment?
41. When questioned on that point at the hearing, the Commission’s representative was not able to show how the fact that an atypical frontier worker receives unemployment benefit paid by the State in which he was last employed was likely to guarantee the worker more favourable conditions for finding new employment when it is clear that the same worker may now register with the employment services in the State in which he was last employed.
42. I would add that, in her written observations, Ms Peeters claimed that the employment services in the State in which she was last employed would be less efficient, since they are less concerned with her finding new employment in so far as, specifically, the payment of benefit does not affect the budget of that State. That is merely a claim which, if proven, would in any case constitute discriminatory conduct contrary to EU law. However, the maintenance of the Miethe case-law cannot be justified solely because of that kind of fear.
43. Furthermore, the fact that, in the event of a conflict between obligations, priority must be given to the obligations to which the person seeking work is subject in the State of residence, necessarily stems from the fact that the State of residence is required to pay unemployment benefit. Nevertheless, I cannot share the view that it constitutes an obstacle to finding new employment in the State of last employment. I still believe that the possibility offered to the worker to register with the employment services of two Member States provides him with simultaneous access, in particular to job and training opportunities, on the labour market of two Member States, thereby increasing his prospects of returning to employment quickly.
44. In those circumstances and for the above reasons, I suggest that the Court answer the first question asked by the referring court to the effect that, under Article 65(5)(a) of Regulation No 883/2004, the only competent State for payment of unemployment benefit to frontier workers, including atypical frontier workers, who are wholly unemployed, is the State of residence.
B – The second question
45. The referring court asks the Court whether Article 7(2) of Regulation No 1612/68 and Article 45 TFEU preclude a refusal to pay unemployment benefit, such as that applied by the Netherlands authorities to the applicants in the main proceedings, solely on the ground that the applicants do not satisfy the condition of residence in the Netherlands laid down by national law in order to be able to claim payment of unemployment benefit.
46. According to settled case-law, ‘the fact that a national measure may be consistent with a provision of secondary legislation ... does not have the effect of removing that measure from the scope of the provisions of the Treaty’.(21) In addition, the Court has ruled that ‘Article 7(2) of Regulation No 1612/68 is the particular expression, in the specific area of the grant of social advantages, of the principle of equal treatment enshrined in Article 39(2) EC, and must be accorded the same interpretation as Article 39(2) EC’.(22)
47. Furthermore, the Court has already had to deal with situations similar to the one in the main proceedings. It is probably Petersen(23) which, although the judgment was delivered before the entry into force of Regulation No 883/2004, is closest to the present case. The Court was asked about the compatibility with Article 39 EC of an Austrian provision which made entitlement to a benefit regarded by the Court as an ‘unemployment benefit’ subject to the condition that the recipients be resident in the national territory of the State concerned, prohibiting the exportability of such a benefit to another Member State. In that case, the applicant in the main proceedings was a German national who, after working as an employed person in Austria, where he was domiciled, became unemployed again. He had then applied to the Austrian authorities for an advance on his unemployment benefit, which was refused because the applicant had, in the meantime, moved back to Germany.
48. However, a fundamental difference with the present case lies in the fact that, in Petersen, it was common ground that the Member State which had refused to pay the benefit in question was actually the competent Member State for payment of unemployment benefit under the coordination rules laid down in Regulation No 1408/71. The legal problem therefore raised was whether the State designated under Regulation No 1408/71 to pay unemployment benefit could, in accordance with primary law, make the payment of such benefit conditional on the applicant having his residence in its territory.
49. The analogy with Petersen thus stops there, as the applicants in the main proceedings in the present case clearly fall within the scope of Article 65 of Regulation No 883/2004, which replaced Article 71 of Regulation No 1408/71. Specifically under the rules laid down in Article 65, the State required to pay benefit to workers such as those in the main proceedings is the State of residence.
50. The question – which is quite different from that faced by the Court in Petersen – is thus whether the failure by the State of last employment to pay that benefit under the coordination rules laid down by the European Union legislature is contrary to the freedom of movement of those workers, it being understood that the applicants in the main proceedings are actually covered by the notion of ‘worker’ within the meaning of Article 45 TFEU.(24) According to the applicants in the main proceedings, who are ultimately calling into question the very essence of the coordination system laid down for frontier workers by Regulation No 883/2004 without ever going so far as to challenge its validity in the light of primary law, Dutch workers would be deterred from exercising their freedom of movement and establishing themselves in the territory of another Member State because, once status as a frontier worker has been acquired, the State in which unemployment benefit is paid becomes the State in which those workers are resident. Moreover, such a situation constitutes discrimination compared with Dutch workers working and residing in the Netherlands.
51. It is true that the Court has ruled that ‘[u]nless it is objectively justified and proportionate to the aim pursued, 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 if there is a consequent risk that it will place the former at a particular disadvantage’.(25) It added that ‘[t]hat is true of a residence condition such as the one to which the grant of the benefit at issue in the main proceedings is subject, which can be more easily met by national workers than by those from other Member States, since the latter workers above all, particularly in the case of unemployment ... , tend to leave the country in which they were formerly employed to return to their countries of origin’.(26)
52. However, in the case in the main proceedings the workers concerned have already exercised their freedom of movement, have already left national territory and do not intend to return there.
53. In order to ascertain whether there is an obstacle or a deterrent to the exercise of freedom of movement, it is first necessary to determine an effect on the situation of frontier workers such as those in the main proceedings. However, I admit to having some difficulty in imagining this.
54. First of all, it is settled case-law that a worker may not claim that his move will be neutral as regards social security. That is an inevitable consequence of the fact that Article 48 TFEU(27) confers on the European Union a power only to coordinate, and not to harmonise, the laws of the Member States in the field of social security. Thus, ‘substantive and procedural differences between the social security systems of individual Member States and hence in the rights of persons who are insured persons there, are unaffected’(28) by Article 48 TFEU.
55. Second, the applicants in the main proceedings have not actually proved that they suffered from being paid unemployment benefit by their Member State of residence. I would point out in that regard that it is very difficult to determine which national system would be more advantageous.
56. First, although it is apparent from the documents before the Court, for example, that the amount of the benefit would be higher in the Netherlands, the term of payment would be longer in Belgium.
57. Second, EU law has not established a coordination principle to guarantee on a systematic basis that the highest amounts of benefit are received. At best it must be ensured that social security contributions are not paid without return.(29) It is true that the Court has ruled that the objective of freedom of movement of workers would not be attained ‘if, as a consequence of the exercise of their right to freedom of movement, workers were to lose the social security advantages guaranteed them by the legislation of one Member State, especially where those advantages represent the counterpart of contributions which they have paid’.(30) It must nevertheless be stated that the applicants in the main proceedings have not lost ‘a social security advantage’. Quite simply, the entitlement to benefit arising by virtue of periods worked in the Netherlands is transferred to the State of residence and can be resumed at any time in the State of last employment if those applicants should re-establish themselves there. It should also be borne in mind that the applicants in the main proceedings may, if they wish, utilise the employment services of the State in which they were last employed. Furthermore, in view of the specific nature of those contributions and of social security systems in general, a strictly accounting logic cannot be applied.(31) I also wish to point out that the non-correspondence between the Member State which collected the contributions and the State in which benefit is paid is a consequence accepted by the Member States by virtue of the choice they have made in favour of frontier workers, which is based on a certain degree of solidarity.(32)
58. Third, as the German Government rightly pointed out in its written observations, the amount of unemployment benefit is generally set by the Member States, clearly on an individual basis, with reference to the cost of living in each State. Consequently, the fact that the amount of the Dutch unemployment benefit is highest can be explained by a higher cost of living in that Member State, to which the applicants in the main proceedings are not exposed as they live and reside either in Belgium or in Germany. That fundamental factor distinguishes them from those who work and reside in the Netherlands. Consequently, there are different situations which may be treated differently.(33)
59. The treatment of frontier workers is aligned with that of residents of the country in which they are established. That is clearly the result of a choice made by the European Union legislature which, in doing so, implemented the principle of non-discrimination. Equal treatment of frontier workers is thus guaranteed in the State of residence, Article 65 of Regulation No 883/2004 providing that the State of residence must pay unemployment benefit ‘as though’ the workers had been subject to their own legislation while last employed.
60. Lastly, it is crucial to the present case to consider that, as I have already said, the refusal by the Netherlands authorities does not deprive the workers of unemployment benefit, but, on the contrary, directs them to their State of residence for the payment of such benefit. Such direction follows from the application of a coordination rule adopted by the European Union legislature which seeks to promote freedom of movement for workers and is based on the idea that it would be in the interest of those workers to receive that benefit in and from their State of residence.
61. It should nevertheless be stated that it is perfectly clear – even though it is not the subject-matter of the present reference for a preliminary ruling – that the residence clause contained in the Netherlands legislation cannot be applied in cases covered, in particular, by Article 65(1) of Regulation No 883/2004 (case of a worker who is partially unemployed and who resides in a State other than the State in which he was last employed) or by Article 65(5)(b) of that regulation (case of a non-frontier worker who, after starting to receive unemployment benefit in the State in which he was last employed, transfers his residence to another State).(34)
62. Since the applicants’ situation is covered by Article 65(5)(a) of Regulation No 883/2004, and for the reasons described above, inter alia in point 52 of this Opinion, in my opinion, in circumstances such as those in the main proceedings, the refusal by the State of last employment to pay unemployment benefit to frontier workers who have their residence in another Member State does not infringe the freedom of movement for workers, where the entitlement to benefit is transferred to the State of residence.
C – The third and fourth questions
63. By its third and fourth questions to the Court, the referring court asks whether Article 87(8) of Regulation No 883/2004, Article 17 of the Charter of Fundamental Rights of the European Union, the principle of legal certainty and/or the principle of the protection of legitimate expectations could require the Netherlands authorities to continue payment of unemployment benefit to the applicants in the main proceedings.
64. It should first be stated that these questions relate to only two of the applicants. The Netherlands authorities started to pay unemployment benefit to Ms Peeters and to Mr Arnold before the entry into force of Regulation No 883/2004, thus applying the Miethe case-law. When those two workers returned to employment, the authorities informed them that their entitlement to benefit could be continued in the Netherlands if they were once again to become unemployed before a date set by the authorities and after 1 May 2010, the date of entry into force of Regulation No 883/2004.
65. The Court is thus being asked, first and foremost, to ascertain whether specific transitional arrangements are capable of applying to frontier workers in a situation such as that I have just described. To do so, it is necessary to conduct an in-depth examination of the transitional arrangements for Regulation No 883/2004.
1. The applicability of Article 87(8) of Regulation No 883/2004 to unemployment benefit
66. It follows from Article 87(8) of Regulation No 883/2004 that, in principle, ‘if, as a result of this Regulation, a person is subject to the legislation of a Member State other than the one determined in accordance with Title II of Regulation [No 1408/71], that legislation shall continue to apply as long as the relevant situation remains unchanged’. The coordination rules for unemployment benefit were laid down, under the earlier regulation, by Title III on ‘special provisions relating to the various categories of benefit’.
67. The legislation applicable to Ms Peeters and to Mr Arnold remains unchanged as a result of the application of the rules of Regulation No 883/2004.(35) It is clear from the wording of Article 87(8) that it does not cover, a priori, situations such as those submitted to the Court for examination. The only transitional provision specifically dedicated to unemployment benefit is Article 87(10) of Regulation No 883/2004, which simply fixes the scope ratione temporis of Article 65(2) and (3) of that regulation in Luxembourg. It does not therefore cast any further light on the situation.
68. In my view, there is a reason for this lacuna. In the initial proposal for a regulation, the Commission proposed establishing the principle that wholly unemployed frontier workers would receive benefit in the State in which they were last employed. As that principle represented a change compared with Regulation No 1408/71, the Commission proposed the adoption of transitional measures.(36) As we know, the Council of the European Union did not follow the Commission’s proposal and the principle ultimately established is that the State of residence pays unemployment benefit. The legislature must have considered it unnecessary to include transitional provisions in that regard, since the principle remained unchanged. However, that was to forget the case of workers classified, under Regulation No 1408/71, as atypical frontier workers.
69. For those reasons, it would seem that an analogous application of Article 87(8) of Regulation No 883/2004 must be considered, in view of the fact that the legislature did not lay down other provisions for the transition, in compliance with acquired entitlements, between the old regulation and the new regulation, which puts an end to the special treatment accorded until then to atypical frontier workers with regard to unemployment benefit. Such a solution would have the advantage of giving a dynamic interpretation to that regulation without, however, running counter to the legislature’s intention to put an end to the Miethe exception.
70. It is difficult to envisage that, for all frontier workers classified as atypical under Regulation No 1408/71 and in receipt of benefit paid by the State in which they were last employed, that payment ceased immediately on 1 May 2010, without advance notice.
71. The legislature has – in my view inadvertently – left a legal vacuum, both in the basic regulation and in the implementing regulation, which has in some cases been filled by the Member States themselves. At the hearing, the Netherlands Government, in particular, confirmed that it applied to unemployment benefit the transitional provision contained in Article 87(8) of Regulation No 883/2004, precisely so as not to confront the workers concerned with an immediate and sudden change for which they were unprepared.(37) Thus, such analogous application would not cause conflict with the Member States either.
2. The notion of ‘unchanged situation’
72. Once the possibility of applying Article 87(8) of Regulation No 883/2004 to unemployment benefit has been accepted, it must still be determined whether the situation of the two applicants concerned in the main proceedings satisfies the conditions laid down by the European Union legislature. That article must be interpreted as meaning that atypical frontier workers who, under Regulation No 1408/71, received unemployment benefit paid by the State in which they were last employed, may continue to receive it ‘while the relevant situation remains unchanged’.
73. What can be the reasons for a change?
74. It is clear that, a priori, new employment can constitute a change of situation for the purposes of Article 87(8) of Regulation No 883/2004, particularly in respect of unemployment benefit.(38) However, it is not necessarily synonymous with the extinction of entitlement to benefit.
75. Because the European Union does not have the necessary competence to harmonise the conditions in which entitlement to unemployment benefit arises, is maintained or ends, it is necessary to refer to national law. Nevertheless, the Member States must lay down those conditions in compliance with European Union law.
76. The referring court must therefore determine whether, under national law, the resumption of a temporary activity undertaken by Ms Peeters and Mr Arnold constitutes a sufficient ground to end payment of benefit or whether it constitutes only a short-lived interruption, it being possible for payment to resume where unemployment recurs after a short period.
77. The documents before the Court do not contain sufficient information on national law to enable it to formulate an opinion and it is in any event for the referring court to give the final assessment. Nevertheless, I wish to highlight the fact that the statements made by the Netherlands authorities unequivocally show that they viewed the applicants’ situation as one continuous unit of time, with the result that new employment is not a sufficient reason to interrupt permanently the payment of unemployment benefit, which is the realisation of the entitlements acquired by virtue of the period worked before the entry into force of Regulation No 883/2004. It is clear from the order for reference that the UWV informed the applicants that, if they were once again to become unemployed before the prescribed date – after the entry into force of Regulation No 883/2004 – they could claim the ‘continuation’ or the ‘resumption’ of payment of the benefit in question.
78. In order to assess whether there has been a change of situation, that is to say, whether an event has occurred which is liable to cause loss of entitlement to unemployment benefit acquired by virtue of periods worked prior to the entry into force of Regulation No 883/2004, the national court will also have to take into consideration the length of the period during which the workers concerned actually resumed employment. Particular attention will have to be paid in that regard to the situation of Ms Peeters. The UWV has claimed inter alia that her resumption of employment between 26 April 2010 and 18 May 2010 constituted a change in her situation justifying the referral of the applicant to the Belgian authorities. However, it is perfectly clear that that very short period worked – barely three weeks – did not create a new entitlement to benefit for Ms Peeters.
79. Thus, without it being necessary to reflect further on a possible infringement of the right to property and the principles of legal certainty and the protection of legitimate expectations, I suggest that the Court answer that Article 87(8) of Regulation No 883/2004 must be interpreted to the effect that it also applies, on a transitional basis, to cases in which, under Title III of Regulation No 1408/71, wholly unemployed atypical frontier workers received unemployment benefit in the State in which they were last employed, whereas Regulation No 883/2004 now designates solely the State of residence for payment of such benefit. The referring court must determine whether, in circumstances such as those in the main proceedings, the resumption of employment has the effect of ending the relevant entitlement acquired by virtue of periods worked prior to the entry into force of Regulation No 883/2004.