By Maria Haag (European University Institute)
On the 26th of February 2016, the Court of Justice of the European Union (CJEU) gave another judgment on the limits to the right to social assistance granted to economically inactive Union citizens in a host Member State. This decision follows after two recent CJEU cases. In Dano (see my previous DELI post) the Court had held that Member States are allowed to deny certain social assistance benefits to Union citizens who are unemployed and are also not looking for employment in the host Member State. In Alimanovic (see my previous DELI post), it further held that a Member State does not have to provide social assistance to an EU migrant worker who has previously worked in the host Member State for less than a year and has been a jobseeker for more than six months. In García-Nieto and Others, the issue before the Court was whether an economically inactive Union citizen can automatically be excluded from the access to social assistance in the first three months of residence in the host Member State.
García-Nieto and Others concerns a Spanish couple with two children. Ms García-Nieto and her daughter moved to Germany in April 2012 and shortly after the mother began working as a kitchen assistant. In June of the same year, her partner, Mr Peña Cuevas, and his son joined the other two in Germany. In July, the family applied for subsistence benefits, which they were refused for Mr Peña Cuevas and his son, due to the fact that at the time of the application Mr Peña Cuevas had resided in Germany for less than three months and did not have the status of worker or self-employed person. When the Spanish family challenged this decision, the German court referred the following question to the CJEU:
‘May the principle of equal treatment laid down in Article 4 of Regulation No. 883/2004 be limited by provisions of national legislation implementing Article 24(2) of Directive 2004/38 that do not in any circumstances allow access to those benefits for the first three months of their residence to Union citizens who are neither workers or self-employed persons in the Federal Republic of Germany nor entitled to exercise freedom of movement under Paragraph 2(3) of the Law on Freedom of Movement and, if so, that what extent may that principle be so limited?’
In other words, does it infringe EU law to automatically exclude economically inactive Union citizens from the access to social assistance benefits (exactly the same benefit that was also at issue in Dano and Alimanovic) in the first three months of residing in a host Member State?
The Court first looked at Mr Peña Cuevas’ right of residence in Germany, as it held that it follows from Article 24(1) of Directive 2004/38 that a Union citizen can only claim equal treatment with nationals of the host Member State if his or her residence complies with the conditions laid down in the Directive (para 38). The Court found that Mr Peña Cuevas has a right of residence under Article 6(1), which stipulates that Union citizens have the right of residence in another Member State for three months without any conditions. Furthermore, Article 14(1) provides that “Union citizens and their family members shall have the right of residence provided for in Article 6, as long as they do not become an unreasonable burden on the social assistance system of the host Member State.” Mr Peña Cuevas was therefore held to have a right of residence in Germany under the Directive 2004/38.
The Court then pointed out, however, that Article 24(2) states that Member States can refuse the grant of social assistance to citizens during the first three months of residence.
In the most interesting part of the decision, the Court states in paragraph 46 that “although Directive 2004/38 requires the host Member State to take account of the individual situation of the person concerned before it … finds that the residence of that person is placing an unreasonable burden on its social assistance system…, no such individual assessment is necessary in circumstances such as those at issue in the main proceedings.” Here, the Court relies on its previous decision in Alimanovic where it had argued that Directive 2004/38 already establishes a gradual system which takes into consideration various factors characterising the individual situation of each applicant for social assistance and, in particular, the duration of the exercise of any economic activity (Alimanovic, para 60).
The Court then reiterates the same arguments it already made in Alimanovic, stating that this clear-cut rule guarantees legal certainty and transparency (para 49). Furthermore, it re-stated that whilst a singular applicant will most likely not be an unreasonable burden for the national social assistance system “the accumulation of all the individual claims which might be submitted to it would be bound to do so” (para 50).
The CJEU concludes therefore that the German law does not infringe EU law by automatically denying EU migrants the access to social assistance in the first three months of their residence in Germany.
This judgment should not come as a surprise, especially given that it was rendered so shortly after the Court’s decision in Dano (decided in November 2014) and Alimanovic (decided in September 2015). Moreover, Directive 2004/38 expressly states that host Member States do not have to grant social benefits to economically inactive Union citizens in the first three months of residence (see Article 24(2) – “the host Member State shall not be obliged to confer entitlement to social assistance during the first three months of residence”).
The most noteworthy part of the decision (as mentioned above) is paragraph 46 which states that:
In that context, it must also be stated that, although Directive 2004/38 requires the host Member State to take account of the individual situation of the person concerned before it adopts an expulsion measure or finds that the residence of that person is placing an unreasonable burden on its social assistance system (judgment in Brey, C‑140/12, EU:C:2013:565, paragraphs 64, 69 and 78), no such individual assessment is necessary in circumstances such as those at issue in the main proceedings.
The Court here refers to its previous decision in Brey, where it held that the Directive 2004/38 precluded an automatic exclusion of an economically inactive Union citizen without considering the personal situation of the Union citizen involved. This was based in part on Recital 16 in the preamble of Directive 2004/38 which states the following:
As long as the beneficiaries of the right of residence do not become an unreasonable burden on the social assistance system of the host Member State they should not be expelled. Therefore, an expulsion measure should not be the automatic consequence of recourse to the social assistance system. The host Member State should examine whether it is a case of temporary difficulties and take into account the duration of residence, the personal circumstances and the amount of aid granted in order to consider whether the beneficiary has become an unreasonable burden on its social assistance system and to proceed to his expulsion…
The recital essentially wants to ensure that a Union citizen cannot automatically be expelled if he or she does not have sufficient resources and comprehensive health insurance. Instead, the Member State should examine the personal circumstances of the Union citizen before it decides that he or she has become an unreasonable burden and thus no longer has a right of residence in the host Member State.
It is clear in García-Nieto and Others that Mr Peña Cuevas has a right of residence in Germany. Furthermore, one can deduce from the facts given in this case that Mr Peña Cuevas was only denied a subsistence allowance in August and September 2012, and was actually granted social assistance from October 2012 onwards, after he had surpassed the initial period of three months of residence (see para 30). Unlike in Brey, Dano and Alimanovic it is therefore clear in this case that Mr Peña Cuevas was able to continue to reside in Germany, and that there was no threat of expulsion.
Whilst paragraph 46 in García-Nieto and Others and paragraph 59 in Alimanovic are almost identical, they have different meanings and outcomes in the two cases. Alimanovic remains the more radical case. In García-Nieto and Others, the applicant is not deprived of his right of residence in Germany, and is only denied social benefits for two months. This is therefore not a case of direct expulsion nor do the facts in García-Nieto and Others suggest that the applicant would de facto have to leave the Member State. In Alimanovic, however, this is less straightforward. Job-seekers under Article 14(4)(b) of Directive 2004/38 retain a right of residence as long as they demonstrate that they are continuing to look for employment and have a genuine chance of being employed. However, without being able to sustain themselves in Germany, it is arguable that the applicants in Alimanovic are being effectively forced to leave the country.
It should be noted that the Court does not make this differentiation between García-Nieto on the one hand, and Brey and Alimanovic on the other. Furthermore, the formulation of paragraph 46 is somewhat problematic, as the Court states “although Directive 2004/38 requires…”. This reasoning is, firstly, not strictly necessary, as the Court had already clarified that the applicant’s right of residence is not questioned, and, secondly, without any further explanation, this formulation could suggest that the Court is outright discounting the Directive.
Finally, the Court in this decision re-emphasises the importance of the interest of the host Member State and thus the community of its citizens over the interest of the individual Union citizen from another Member State. This becomes very apparent when the Court rejects the requirement of an assessment of the personal circumstances of the Union citizen. The Court here, both in Alimanovic and García-Nieto and Others, calls attention to the accumulation of benefit claims made by Union citizens and the resulting burden on national authorities and budgets. It is therefore easy to suggest that the Court is taking into account the current political and financial circumstances in the Member States.