Facts and background

In the recent years, the Austrian Ombudsman had been dealing with numerous cases in Austria where the payment of family benefits was considerably delayed because of the lack of cooperation by the Member State where one family member resides or works. Typically, in Austria, the beneficiaries of these benefits are single mothers whose (former) partners work in another Member State.

The Austrian Ombudsman wrote to the European Ombudsman seeking her assistance to obtain clarifications from the European Commission as to the correct interpretation of Regulation 987/2009[1] (hereinafter referred to as ‘the Regulation’) concerning family benefits in cross-border situations.

According to Article 6(2) of the Regulation, “[w]here there is a difference of views between the institutions or authorities of two or more Member States about which institution should provide the benefits in cash or in kind, the person concerned who could claim benefits if there was no dispute shall be entitled, on a provisional basis, to the benefits provided for by the legislation applied by the institution of his place of residence or, if that person does not reside on the territory of one of the Member States concerned, to the benefits provided for by the legislation applied by the institution to which the request was first submitted”. However, the Austrian Ombudsman pointed out that this principle was often not followed. Until there is agreement between the two Member States as to which one should provide the benefits, the parent entitled to the benefit might not receive any benefit at all, which puts these persons into a financially delicate situation.

Furthermore, the second subparagraph of Article 60(2) of the Regulation provides that “[i]f the institution to which the application was forwarded does not take a position within two months of the receipt of the application, the provisional decision referred to above shall apply and the institution shall pay the benefits provided for under its legislation and inform the institution to which the application was made of the amount of benefits paid”. However, according to the experience of the Austrian Ombudsman, also this had at times remained a dead letter.

The Austrian Ombudsman pointed out that he wrote to the European Commission twice (in 2011 and 2016) about the above problems. He received the confirmation that the state of residence must pay the benefits on a provisional basis even when there is a difference of views and the institution of the state of the primary payer does not provide a reply within the two-month-deadline.

However, also the Czech Ombudsman had recently written to the Commission about similar problems in the Czech Republic, but she received a different reply indicating that no such obligation could be deduced from EU law.

According to the Austrian Ombudsman, SOLVIT had not managed to resolve the problems either. For instance, there is currently a case in Austria where a single mother has received no family benefits at all for her child who was born already in January 2017.

Query

On 30 April 2018, the European Ombudsman decided to open a query procedure in order to seek the Commission’s views as regards the following:

1. It appears that the Austrian and Czech Ombudsmen have received diverging replies as to the provisional obligation to pay the benefits under Article 6(2) and the second subparagraph of Article 60(2) of Regulation 987/2009. How should these provisions be interpreted in situations described by the Austrian Ombudsman?

2. It appears that the SOLVIT network has not managed to resolve all the individual cases in a satisfactory manner. Is the Commission of the view that there could be a systemic problem in the application of the Regulation in cross-border situations?

3. Are there any other solutions the Commission could consider in order to facilitate the situation?

Commission's reply

In its reply of 21 June 2018, the Commission explained that Article 60[2] of Regulation 987/2009 contains provisions necessary for the interpretation of Articles 67 and 68 of Regulation 883/2004[3]. It stated that paragraphs 3 and 4 of Article 60 refer to two different situations. Paragraph 3 refers to the situation in which ”the institution of the Member State to which the provisional decision was sent, does not reply within the deadline of two months”. In this situation, silence should be interpreted as a positive reply and subsequently the institution should inform the applicant and pay the benefits according to its legislation. It also said that “the secondarily competent institutions pays the differential supplement as soon as the provisional decision becomes definitive and it has the necessary information to calculate the differential supplement”.

Regarding paragraph 4 of Article 60, the Commission stated that it “concerns the situation where the institution, to which the provisional decision has been sent, takes the view that it is not primarily competent. In this situation, the procedure of Article 6(2) to (5) shall apply. The institution, to which the claim was made, shall, at the request of the applicant, provisionally pay the amount of the family benefits awarded under its legislation”.

The Commission also said that the letters that it had sent to the Czech and Austrian Ombudsmen concerned replies in the concrete cases, which did not address situations where Member States had diverging views on a specific case.

The Commission stressed that it is aware of delays in the application of Article 60(3) of the Regulation only in cross-border situations between Austria and Czech Republic. Thus, it did not consider the delays as systemic.

For what concerns potential solutions to the problem, it stated that, in accordance with Article 6 of the Regulation, the Administrative Commission has a role in the dialogue and conciliation procedures, where there is a dispute between Member States concerning their competence.

The Commission also referred to the upcoming Electronic Exchange of Social Security Information (EESSI), which is scheduled to be implemented by the Member States by July 2019. In the Commission’s opinion, the EESSI will ensure a fast delivery of information, which improves the administrative cooperation between the national authorities of Member States.

Finally, the Commission added that it would address labour mobility and social security challenges by the potential creation of a multi-purpose European Social Security Number (ESSN) that will simplify and modernise citizens’ interaction with the public authorities in a range of areas.

Feedback

On 29 August 2018, the Austrian Ombudsman provided the European Ombudsman with his comments on the Commission’s reply.

He stressed the difficulties in the communication between the authorities of different Member States. Despite the two-month deadline, the national authorities of one Member State may need to wait many months for a reply from another Member State and sometimes the replies they get are incomplete. The very existence of vulnerable families or single parents can be threatened by this behaviour and the involvement of SOLVIT has not accelerated the procedure.

The previous replies that the Austrian Ombudsman had received (in 2011 and 2016) from the Commission stated that the state of residence had to provide the family benefit provisionally two months after the application had been received, if it was supposedly primarily competent. The Commission’s views at the time suggested that the concept of ‘dispute’ referred to in Articles 6(2) and 60(2) of the Regulation, constituting the condition for this additional duty, had to be interpreted broadly, including also situations in which an institution did not reply or was late in doing so. However, despite his efforts, the Austrian authorities did not follow such an interpretation.

He further referred to the Commission’s reply to the European Ombudsman about Article 60(3) of Regulation 987/2009. In his view, the Commission’s interpretation led to the result that families still need to wait, as the authority whose reply to the authority of another Member State is delayed, is causing delays also to the provision of the family benefit. This was clearly confirmed by the earlier experience of the Austrian Ombudsman.

Furthermore, the purpose of the applicable provisions of EU law is to avoid that mobile EU citizens remain without any benefit at all for a long period of time (he referred to Recital 10[4] of Regulation 987/2009). He stressed that this has not been achieved and that, in his view, there is a pressing need for a solution to the issue.

Finally, regarding the possibly systemic nature of the issue, the Austrian Ombudsman disagreed with the Commission saying that the fact that only the Austrian and Czech Ombudsmen had brought the issue to the Commission’s attention does not exclude that the problem could exist also in other Member States.

Network consultation

In order to clarify the possibly systemic nature of the problem, the European Ombudsman launched a consultation with the members of the European Network of Ombudsmen (ENO) asking whether they had experienced situations similar to the ones described in the Austrian Ombudsman’s query.

Thirteen of the ENO members replied, of which six members (the Belgian, Croatian, Finnish, Greek, Portuguese and Slovak) confirmed to have experienced similar situations.

Closing procedure

The European Ombudsman shared the Austrian Ombudsman’s comments on the Commission’s reply and the replies of the six Ombudsmen with the Commission. She also forwarded a summary of the replies to the Members of the ENO who participated in the consultation.

The European Ombudsman’s Office thanked the Commission and the Members of ENO for their excellent co-operation in this query procedure and for their efforts to send replies within a short period of time.

 

[1] Regulation (EC) No 987/2009 of the European Parliament and of the Council of 16 September 2009 laying down the procedure for implementing Regulation (EC) No 883/2004 on the coordination of social security systems, OJ 2009 L 284, p. 1.

[2] Article 60 of Regulation 987/2009: “Procedure for applying Articles 67 and 68 of the basic Regulation:

1. The application for family benefits shall be addressed to the competent institution. For the purposes of applying Articles 67 and 68 of the basic Regulation, the situation of the whole family shall be taken into account as if all the persons involved were subject to the legislation of the Member State concerned and residing there, in particular as regards a person’s entitlement to claim such benefits. Where a person entitled to claim the benefits does not exercise his right, an application for family benefits submitted by the other parent, a person treated as a parent, or a person or institution acting as guardian of the child or children, shall be taken into account by the competent institution of the Member State whose legislation is applicable.

2. The institution to which an application is made in accordance with paragraph 1 shall examine the application on the basis of the detailed information supplied by the applicant, taking into account the overall factual and legal situation of the applicant’s family.

If that institution concludes that its legislation is applicable by priority right in accordance with Article 68(1) and (2) of the basic Regulation, it shall provide the family benefits according to the legislation it applies.

If it appears to that institution that there may be an entitlement to a differential supplement by virtue of the legislation of another Member State in accordance with Article 68(2) of the basic Regulation, that institution shall forward the application, without delay, to the competent institution of the other Member State and inform the person concerned; moreover, it shall inform the institution of the other Member State of its decision on the application and the amount of family benefits paid.

3. Where the institution to which the application is made concludes that its legislation is applicable, but not by priority right in accordance with Article 68(1) and (2) of the basic Regulation, it shall take a provisional decision, without delay, on the priority rules to be applied and shall forward the application, in accordance with Article 68(3) of the basic Regulation, to the institution of the other Member State, and shall also inform the applicant thereof. That institution shall take a position on the provisional decision within two months.

If the institution to which the application was forwarded does not take a position within two months of the receipt of the application, the provisional decision referred to above shall apply and the institution shall pay the benefits provided for under its legislation and inform the institution to which the application was made of the amount of benefits paid.

4. Where there is a difference of views between the institutions concerned about which legislation is applicable by priority right, Article 6(2) to (5) of the implementing Regulation shall apply. For this purpose, the institution of the place of residence referred to in Article 6(2) of the implementing Regulation shall be the institution of the child’s or childrens’ place of residence.

5. If the institution which has supplied benefits on a provisional basis has paid more than the amount for which it is ultimately responsible, it may claim reimbursement of the excess from the institution with primary responsibility in accordance with the procedure laid down in Article 73 of the implementing Regulation.”

[3] Regulation (EC) No 883/2004 of the European Parliament and of the Council of 29 April 2004 on the coordination of social security systems, OJ 2004 L 166, p. 1.

[4] Recital 10 of Regulation 987/2009 reads as follows: “To determine the competent institution, namely the one whose legislation applies or which is liable for the payment of certain benefits, the circumstances of the insured person and those of the family members must be examined by the institutions of more than one Member State. To ensure that the person concerned is protected for the duration of the necessary communication between institutions, provision should be made for provisional membership of a social security system”.