Court of Justice of the European Communities (including Court of First Instance Decisions)

1 . OFFICIALS - REMUNERATION - EXPATRIATION ALLOWANCE - FOREIGN RESIDENCE ALLOWANCE - CONDITIONS GOVERNING GRANT
( STAFF REGULATIONS , ANNEX VII , ART . 4 )
2 . OFFICIALS - REMUNERATION - EXPATRIATION ALLOWANCE - CONDITIONS GOVERNING GRANT - BASED ON OBJECTIVE FACTORS - DIFFERENT TREATEMENT OF COMPARABLE SITUATIONS - BREACH OF PRINCIPLE OF EQUALITY - NONE
( STAFF REGULATIONS , ANNEX VII , ART . 4 ( 1 ))

1 . CONSIDERED AS A WHOLE , THE PROVISIONS OF ARTICLE 4 OF ANNEX VII TO THE STAFF REGULATIONS INDICATE THAT , WHILST THE COMMUNITY LEGISLATURE MADE THE FACT OF FOREIGN ORIGIN THE SOLE BASIS FOR THE GRANT OF THE FOREIGN RESIDENCE ALLOWANCE , FOR THE PURPOSES OF THE GRANT OF THE EXPATRIATION ALLOW- ANCE IT ADOPTED ACTUAL CHANGE OF RESIDENCE AS THE PRIMARY CRITERION AND REGARDED NATIONALITY AS MERELY OF SECONDARY IMPORTANCE ; THAT IS CONFIRMED BY ARTICLE 4 ( 1 ) ( B ), WHEREBY THE EXPATRIATION ALLOWANCE IS EVEN GRANTED TO OFFICIALS WHO ARE NATIONALS OF THE COUNTRY IN WHICH THEY ARE EMPLOYED , PROVIDED THAT THEY RESIDED IN ANOTHER STATE DURING THE TEN YEARS PRECEDING THEIR RECRUIT- MENT .

2 . THE FACT THAT OFFICIALS FIND THAT PAYMENT OF THE EXPATRIATION ALLOWANCE IS DENIED TO THEM WHEN THEIR CIRCUMSTANCES ARE CLOSE TO THOSE DEFINED BY ARTICLE 4 ( 1 ) OF ANNEX VII TO THE STAFF REGULATIONS DOES NOT JUSTIFY THE CONCLUSION THAT THOSE PROVISIONS CONTAIN ARBITRARY DIFFERENTIATION , WHEN , BASED ON OBJECTIVE FACTORS , THEY APPLY IN THE SAME MANNER TO ALL OFFICIALS WHO ARE PLACED IN THE SITUATION CONTEMPLATED BY THE STAFF REGULATIONS . IT FOLLOWS THAT THE SAID PROVISION DOES NOT CONTAIN ANY FACTOR OF SUCH A KIND AS TO GIVE RISE , IN BREACH OF THE PRINCIPLE OF EQUAL TREATMENT AND NON-DISCRIMINATION , TO A DIFFERENCE IN TREATMENT BETWEEN OFFICIALS WHO ARE IN FACT PLACED IN COMPARABLE SITUATIONS .

IN CASE 1322/79
GAETANO VUTERA , AN OFFICIAL OF THE COMMISSION OF THE EUROPEAN COMMUNITIES , RESIDING AT 187 RUE DU PROGRES , 1030 BRUSSELS , ASSISTED AND REPRESENTED BY LEON GOFFIN , MICHEL MAHIEU AND ROLAND DUPONT OF THE BRUSSELS BAR , WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE CHAMBERS OF ERNEST ARENDT , RUE PHILIPPE II , BOITE POSTALE 39 ,
APPLICANT ,
V
COMMISSION OF THE EUROPEAN COMMUNITIES , REPRESENTED BY DENISE SORASIO , ACTING AS AGENT , ASSISTED BY DANIEL JACOB OF THE BRUSSELS BAR , WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE OFFICE OF MARIO CERVINO , JEAN MONNET BUILDING , KIRCHBERG ,
DEFENDANT ,

APPLICATION FOR THE ANNULMENT OF THE DECISION NOTIFIED TO THE APPLICANT ON 25 SEPTEMBER 1979 , WHEREBY THE COMMISSION REJECTED THE COMPLAINT LODGED BY THE APPLICANT ON 19 JUNE 1979 WITH THE OBJECT OF OBTAINING PAYMENT OF THE EXPATRIATION ALLOWANCE PROVIDED FOR BY ARTICLE 4 OF ANNEX VII TO THE STAFF REGULATIONS ,

1 BY AN APPLICATION LODGED AT THE COURT REGISTRY ON 21 DECEMBER 1979 , GAETANO VUTERA , AN OFFICIAL OF THE COMMISSION OF THE EUROPEAN COMMUNITIES IN BRUSSELS , BROUGHT AN ACTION FOR THE ANNULMENT OF THE DECISION NOTIFIED TO HIM ON 25 SEPTEMBER 1979 WHEREBY THE COMMISSION REJECTED THE COMPLAINT WHICH HE LODGED ON 19 JUNE 1979 WITH THE OBJECT OF OBTAINING PAYMENT OF THE EXPATRIATION ALLOWANCE PROVIDED FOR BY ARTICLE 4 OF ANNEX VII TO THE STAFF REGULATIONS .

2 THE APPLICANT , WHO WAS BORN IN ITALY IN 1944 , EMIGRATED TO BELGIUM IN 1947 ; HE LIVED IN THAT COUNTRY WITHOUT BREAK , WAS EDUCATED THERE AND HELD VARIOUS POSTS THERE UNTIL HIS RECRUITMENT BY THE COMMISSION ON 17 MARCH 1975 AS A MEMBER OF THE LOCAL STAFF . HE HAS RETAINED HIS ITALIAN NATIONALITY , HIS WIFE IS ALSO ITALIAN , HIS CHILDREN ATTEND THE ITALIAN SCHOOL IN BRUSSELS AND HE IS ENROLLED ON THE ITALIAN REGISTER OF ELECTOR . AS AN ITALIAN NATIONAL , HE IS IN RECEIPT OF THE FOREIGN RESIDENCE ALLOWANCE PURSUANT TO ARTICLE 4 ( 2 ) OF ANNEX VII TO THE STAFF REGULATIONS ; HOWEVER , HE CONSIDERS THAT HE IS ENTITLED TO THE EXPATRIATION ALLOWANCE PROVIDED FOR BY PARAGRAPH ( 1 ) OF THE SAID ARTICLE .

3 THAT PROVISION STATES AS FOLLOWS :
' ' AN EXPATRIATION ALLOWANCE SHALL BE PAID , EQUAL TO 16% OF THE TOTAL AMOUNT OF THE BASIC SALARY PLUS HOUSEHOLD ALLOWANCE AND THE DEPENDENT CHILD ALLOWANCE PAID TO THE OFFICIAL ,
( A ) TO OFFICIALS :
WHO ARE NOT AND HAVE NEVER BEEN NATIONALS OF THE STATE IN WHOSE TERRITORY THE PLACE WHERE THEY ARE EMPLOYED IS SITUATED ; AND
WHO DURING THE FIVE YEARS ENDING SIX MONTHS BEFORE THEY ENTERED THE SERVICE DID NOT HABITUALLY RESIDE OR CARRY ON THEIR MAIN OCCUPATION WITHIN THE EUROPEAN TERRITORY OF THAT STATE . FOR THE PURPOSES OF THIS PROVISION , CIRCUMSTANCES ARISING FROM WORK DONE FOR ANOTHER STATE OR FOR AN INTERNATIONAL ORGANIZATION SHALL NOT BE TAKEN INTO ACCOUNT ;

( B)TO OFFICIALS WHO ARE OR HAVE BEEN NATIONALS OF THE STATE IN WHOSE TERRITORY THE PLACE WHERE THEY ARE EMPLOYED IS SITUATED BUT WHO DURING THE TEN YEARS ENDING AT THE DATE OF THEIR ENTERING THE SERVICE HABITUALLY RESIDED OUTSIDE THE EUROPEAN TERRITORY OF THAT STATE FOR REASONS OTHER THAN THE PERFORMANCE OF DUTIES IN THE SERVICE OF A STATE OR OF AN INTERNATIONAL ORGANIZATION . ' '
4 THE APPLICANT MAINTAINS THAT THAT PROVISION IS CONTRARY TO THE PRINCIPLE OF EQUALITY AND OF NON-DISCRIMINATION BECAUSE IT CREATES AN UNWARRANTED DIFFERENCE OF TREATMENT BETWEEN OFFICIALS WHO ARE IN FACT PLACED IN COMPARABLE SITUATIONS . INDEED , IN HIS OPINION , THERE IS NO OBJECTIVE DIFFERENCE AS FAR AS EXPATRIATION IS CONCERNED BETWEEN HIS SITUATION AS A FOREIGNER WHO AT THE TIME OF HIS RECRUITMENT HAD RESIDED FOR MORE THAN FIVE YEARS AND SIX MONTHS IN THE COUNTRY IN WHICH HE IS EMPLOYED , AND THAT OF AN OFFICIAL WHO HAD RESIDED THERE FOR A SHORTER TIME , OR WHO , ALTHOUGH HAVING ALSO RESIDED FOR MORE THAN FIVE YEARS AND SIX MONTHS IN THE COUNTRY IN WHICH HE IS EMPLOYED , PERFORMED DUTIES IN THE SERVICE OF ANOTHER STATE OR OF AN INTERNATIONAL ORGANIZATION . MOREOVER , HE SAYS , THE COUNCIL HAD ITSELF ACKNOWLEDGED THIS DISCRIMINATION VITIATING THE CONTESTED PROVISION BY GRANTING A FOREIGN RESIDENCE ALLOWANCE TO AN OFFICIAL WHO IS NOT AND NEVER HAS BEEN A NATIONAL OF THE STATE IN WHOSE TERRITORY THE PLACE WHERE HE IS EMPLOYED IS SITUATED AND WHO DOES NOT FULFIL THE CONDITIONS LAID DOWN BY ARTICLE 4 ( 1 ) OF ANNEX VII TO THE STAFF REGULATIONS ; BUT THAT ALLOWANCE MERELY REDUCED THE INEQUALITY WITHOUT REMOVING IT . IN ADDITION , THE APPLICANT IS OF THE OPINION THAT IT IS WRONG TO CONTEND THAT THE EXPATRIATION ALLOWANCE DEPENDS ESSENTIALLY ON THE CRITERION OF RESIDENCE SINCE IT IS ALSO PAYABLE EVEN WHEN AT THE TIME OF HIS RECRUITMENT THE OFFICIAL HAS ALREADY BEEN IN THE COUNTRY IN WHICH HE IS EMPLOYED EITHER FOR LESS THAN FIVE YEARS AND SIX MONTHS OR FOR A LONGER PERIOD , PROVIDED THAT HE PERFORMED DUTIES IN THE SERVICE OF ANOTHER STATE OR AN INTERNATIONAL ORGANIZATION . THIS BREACH OF A SUPERIOR RULE OF LAW MUST LEAD TO THE INAPPLICABILITY OF ARTICLE 4 ( 1 ) OF ANNEX VII TO THE STAFF REGULATIONS AND CONSEQUENTLY TO THE ANNULMENT OF THE COMMISSION ' S DECISION OF 26 SEPTEMBER 1979 .
5 IN ORDER TO DEAL WITH THAT SUBMISSION IT IS NECESSARY TO EXAMINE THE SYSTEM SET UP BY THE COMMUNITY LEGISLATURE .

6 THE PROVISIONS OF ARTICLE 4 CONSIDERED AS A WHOLE INDICATE THAT , WHILST THE COMMUNITY LEGISLATURE MADE THE FACT OF FOREIGN ORIGIN THE SOLE BASIS FOR THE GRANT OF THE FOREIGN RESIDENCE ALLOWANCE , FOR THE PURPOSES OF THE GRANT OF THE EXPATRIATION ALLOWANCE IT ADOPTED ACTUAL CHANGE OF RESIDENCE AS THE PRIMARY CRITERION AND REGARDED NATIONALITY AS MERELY OF SECONDARY IMPORTANCE .

7 THIS PRIMACY OF THE CRITERION OF RESIDENCE OVER THAT OF NATIONALITY IS CONFIRMED BY ARTICLE 4 ( 1 ) ( B ), WHEREBY THE EXPATRIATION ALLOWANCE IS EVEN GRANTED TO OFFICIALS WHO ARE NATIONALS OF THE COUNTRY IN WHICH THEY ARE EMPLOYED , PROVIDED THAT THEY RESIDED IN ANOTHER STATE DURING THE TEN YEARS PRECEDING THEIR RECRUITMENT .

8 FOR THE PURPOSE OF APPLYING THAT CRITERION THE REGULATIONS ESTABLISHED SPECIFIC CATEGORIES WITH FIGURES , RESULTING NECESSARILY IN THE NEED TO FIX APPROPRIATE LIMITS . IN FACT , THE CONDITION OF NON-RESIDENCE TAKES INTO ACCOUNT A PERIOD OF FIVE YEARS ENDING SIX MONTHS BEFORE ENTRY INTO THE SERVICE ; IN THIS REGARD AN EXCEPTION IS PROVIDED FOR IN FAVOUR OF OFFICIALS WHO DURING THAT PERIOD RESIDED IN THE COUNTRY IN WHICH THEY ARE EMPLOYED , WHERE THEY WERE IN THE SERVICE OF ANOTHER STATE OR OF AN INTERNATIONAL ORGANIZATION , ACCOUNT HAVING BEEN TAKEN OF THE FACT THAT UNDER THOSE CIRCUMSTANCES THEY CANNOT BE DEEMED TO HAVE ESTABLISHED A LASTING TIE WITH THE COUNTRY IN WHICH THEY ARE EMPLOYED .

9 THE APPLICATION OF THOSE CATEGORIES MAY DOUBTLESS GIVE RISE TO MARGINAL CASES IN WHICH OFFICIALS FIND THAT PAYMENT OF THE EXPATRIATION ALLOWANCE IS DENIED TO THEM WHEN THEIR CIRCUMSTANCES ARE CLOSE TO THOSE DEFINED BY ARTICLE 4 OF ANNEX VII ; NEVERTHELESS , IT CANNOT BE INFERRED FROM THAT CIRCUMSTANCE THAT THOSE PROVISIONS CONTAIN ARBITRARY DIFFERENTIATION , WHEN , BASED ON OBJECTIVE FACTORS , THEY APPLY IN THE SAME MANNER TO ALL OFFICIALS WHO ARE PLACED IN THE SITUATION CONTEMPLATED BY THE STAFF REGULATIONS .

10 FROM ALL OF THOSE CONSIDERATIONS IT FOLLOWS THAT ARTICLE 4 ( 1 ) OF ANNEX VII TO THE STAFF REGULATIONS DOES NOT CONTAIN ANY FACTOR OF SUCH A KIND AS TO GIVE RISE TO A DIFFERENCE IN TREATMENT BETWEEN OFFICIALS WHO ARE IN FACT PLACED IN COMPARABLE SITUATIONS ; THEREFORE THE APPLICANT WAS WRONG IN HIS SUBMISSION THAT THERE WAS A BREACH OF THE PRINCIPLE OF EQUAL TREATMENT AND OF NON-DISCRIMINATION .

11 CONSEQUENTLY , THE VALIDITY OF THOSE PROVISIONS CANNOT BE CALLED IN QUESTION , AND SINCE THE APPLICANT DOES NOT COME WITHIN THE TERMS OF ARTICLE 4 ( 1 ) OF ANNEX VII TO THE STAFF REGULATIONS , THERE ARE THEREFORE NO GROUNDS TO ANNUL THE COMMISSION ' S DECISION REJECTING THE APPLICANT ' S COMPLAINT .

12 UNDER ARTICLE 70 OF THE RULES OF PROCEDURE , IN PROCEEDINGS BROUGHT BY OFFICIALS AND OTHER SERVANTS OF THE COMMUNITIES THE INSTITUTIONS ARE TO BEAR THEIR OWN COSTS .

ON THOSE GROUNDS ,
THE COURT ( SECOND CHAMBER )
HEREBY :
1 . DISMISSES THE APPLICATION ;

2 . ORDERS THE PARTIES TO BEAR THEIR OWN COSTS .