Court of Justice of the European Union highlights importance of EU Charter of Fundamental Rights for pre-settled EU nationals.
CG v. Department for Communities in Northern Ireland (Case C-709/20)
On 15 July 2021, the Court of Justice of the European Union (CJEU) gave judgment in CG v. Department for Communities in Northern Ireland (Case C-709/20). Law Centre NI represented CG.
CG is an EU citizen who moved to Northern Ireland several years ago with her, now estranged, partner. She is a mother of two small children, who were born in Northern Ireland. (See Law Centre NI’s press statement for more information on CG’s circumstances.)
Also in June 2020, CG made a claim for Universal Credit (UC) to the Department for Communities (‘the Department’). The Department refused her claim on the basis that she does not meet the basic qualifying criteria for UC under Regulation 9 of the Universal Credit (Northern Ireland) Regulations 2016 (‘UC Regulations’). Regulation 9(3)(d)(i) UC Regulations excludes from eligibility anyone whose right to reside in the UK is based solely on a grant of pre-settled status.
At the time the Department made its decision on CG’s claim for UC, EU law continued to apply in the UK.
Article 18 of the Treaty on the Functioning of the European Union (TFEU) provides that discrimination by EU member states against EU citizens on the grounds of nationality is unlawful. Articles 20 and 21 TFEU provide that EU citizens have the right to move and reside freely in other member states. However, this right is qualified. One qualification is found in Article 24 of Directive 2004/38/EC (‘the Citizens’ Rights Directive’), which provides that member states do not have to provide social assistance (i.e. welfare benefits such as UC) to EU citizens before they obtain a permanent right to reside.
When the Department refused CG’s claim for UC, she appealed to the appeal tribunal. At her appeal hearing on 21 December 2020, CG argued that as a recipient of pre-settled status, her temporary right of residence meant that she should be regarded as in Northern Ireland for the purpose of Article 9 UC regulations and therefore entitled to receive UC. She argued that the Department’s refusal of her claim constituted discrimination on the ground of nationality contrary to Article 18 TFEU.
The Department argued that under national law, pre-settled status does not in itself confer any rights to social benefits, which are subject to their own eligibility conditions.
Recognising that CG’s case raised a point of EU law, the appeal tribunal decided to refer her case to the CJEU. This process is known as a ‘preliminary reference’.
In its preliminary reference to the CJEU, the Appeals Service of Northern Ireland (‘the Appeals Service’) asked whether the UC Regulations, in excluding CG from eligibility for UC, are unlawfully discriminatory on the grounds of nationality, either directly or indirectly, under Article 18 TFEU, and if they are indirectly discriminatory, can they be justified.
The CJEU acknowledged that as CG is an EU citizen who exercised her right to move and reside in the UK, her case is within the scope of EU law. She may, therefore, in principle, rely on the prohibition on discrimination in Article 18.
The CJEU stated, however, that Article 18 only applies in its own right to situations where the TFEU does not lay down specific rules on non-discrimination. The CJEU noted that the Citizens’ Rights Directive contains a specific expression of the principle of non-discrimination.
The Court stated:
‘…It follows that a person in CG’s position falls within the scope of that directive, with the result that it is in the light of Article 24 of [the Citizens’ Rights Directive], and not the first paragraph of Article 18 TFEU, that it is necessary to assess whether that person faces discrimination on the grounds of nationality.’
On that basis, the Court reformulated the Appeals Service’s question as:
‘[W]hether Article 24 of [the Citizens’ Rights Directive] must be interpreted as precluding legislation of a host Member State which excludes from social assistance economically inactive Union citizens who do not have sufficient resources and to whom that State has granted, on the basis of national law, a temporary right of residence, where those benefits are guaranteed to nationals of the Member State concerned who are in the same situation.’
The Citizens’ Rights Directive – Directive 2004/38
Having reframed the Appeals Service’s question, the Court considered if the Citizens’ Rights Directive prevents Member States from applying rules that treat people in CG’s situation differently to nationals of the Member State.
The Court acknowledged that Article 24(1) of the Citizens’ Rights Directive requires that EU citizens residing in another Member State on the basis of the Directive enjoy equal treatment with nationals of the Member State. However, in respect of access to social assistance, an EU citizen can only claim equal treatment if their residence complies with the conditions of the Directive. In support of this, the Court referred to its previous decision in Dano, C-333/13.
The Court reasoned that for periods of residence longer than three months but less than five years, the right of residence is subject to Article 7(1) of the Citizens’ Rights Directive. Article 7(1)(b) provides that economically inactive citizens are obliged to have sufficient resources for themselves and their family.
At paragraph 78, the Court stated:
‘It follows that a Member State has the possibility, pursuant to Article 7 of [the Citizens’ Rights Directive], of refusing to grant social benefits to economically inactive Union citizens who exercise their right to freedom of movement and who do not have sufficient resources to claim a right of residence under that directive (see, to that effect, judgment of 11 November 2014, Dano, C-333/13, EU:C:2014:2358, paragraph 78).’
In the Court’s view, the financial situation of each claimant should be examined without taking account of the social benefits they have claimed. On the basis of this examination, it can be determined whether the claimant meets the condition in Article 7(1)(b) (i.e. sufficient resources) and whether they can rely on the principle of non-discrimination in Article 24(1) of the Citizens’ Rights Directive.
Turning to CG’s case, the Court decided that on the basis of information provided to it by the Appeal’s Service, CG does not have sufficient resources, is likely to become an unreasonable burden on the social assistance system of the UK and therefore cannot rely on the principle of non-discrimination in the Citizens’ Rights Directive.
That assessment, according to the Court, cannot be called into question by the fact that CG has a right of temporary residence under national law which was granted without condition as to resources. To permit such claimants to rely on the principle of non-discrimination when they do not satisfy the conditions under the Citizens’ Rights Directive, would, in the Court’s view, give them broader protection that they would have enjoyed under the Directive.
Article 37 of the Citizens’ Rights Directive permits Member States to establish more favourable rules than those laid down by the Directive. However, a right of residence granted under more favourable national rules cannot be regarded as granted ‘on the basis of’ or in implementation of the Citizens’ Rights Directive. In such circumstances, it is up to the Member State to specify the consequences of the right of residence.
The Court concluded:
‘Article 24 of [the Citizens’ Rights Directive] must be interpreted as not precluding the legislation of a host Member State which excludes from social assistance economically inactive Union citizens who do not have sufficient resources and to whom that State has granted a temporary right of residence, where those benefits are guaranteed to nationals of the Member State concerned who are in the same situation.’
Charter of Fundamental Rights of the European Union
Having ruled out application of the right to equal treatment under the Citizens’ Rights Directive, the CJEU acknowledged that as CG’s case is within the scope of EU law, the Charter of Fundamental Rights of the European Union applies. Where a Member State grants a right of residence in cases such as CG’s, the Member State is obliged to comply with the provisions of the Charter.
At paragraph 89 the Court stated:
‘In particular, it is for the host Member State, in accordance with Article 1 of the Charter, to ensure that a Union citizen who has made use of his or her freedom to move and to reside within the territory of the Member States, who has a right of residence on the basis of national law, and who is in a vulnerable situation, may nevertheless live in dignified conditions.’
The Court stated that Article 7 of the Charter recognises the right to respect for private and family life and must be read in conjunction with the obligation to take into consideration the best interests of the child.
The Court concluded:
‘…[P]rovided that a Union citizen resides legally, on the basis of national law, in the territory of a Member State other than that of which he or she is a national, the national authorities empowered to grant social assistance are required to check that a refusal to grant such benefits based on that legislation does not expose that citizen, and the children for which he or she is responsible, to an actual and current risk of violation of their fundamental rights, as enshrined in Articles 1, 7 and 24 of the Charter. Where that citizen does not have any resources to provide for his or her own needs and those of his or her children and is isolated, those authorities must ensure that, in the event of a refusal to grant social assistance, that citizen may nevertheless live with his or her children in dignified conditions. In the context of that examination, those authorities may take into account all means of assistance provided for by national law, from which the citizen concerned and her children are actually entitled to benefit.’
CG’s case will now return to the appeal tribunal for determination. The question for the appeal tribunal will be whether the Department’s refusal of UC exposed CG to a risk of violation of her fundamental rights enshrined in Article 1 (human dignity), Article 7 (respect for private and family life) and Article 24 (rights of the child) of the Charter, and whether it leaves her, and her children, in a situation where they are unable to live in dignified conditions.
 The EU Settlement Scheme invited all EU migrants and their family members who were living in the UK on 31 December 2020 to apply for permission to remain in the UK. Anyone who was living in the UK for at least 5 years up to 31 December, is eligible to be granted settled status. Those who had not been the UK for the required 5 years, are eligible for pre-settled status.
 Regulation 9(3)(d)(i) was added to the UC Regulations by the Social Security (Income-related Benefits) (Updating and Amendment) (EU Exit) Regulations (NI) 2019 in May 2019.
 The Withdrawal Agreement provided for the continued application of EU law for a transition period ending at 23.00 on 31 December 2020. This was given effect by s1A European Union (Withdrawal) Act 2018, inserted by the European Union (Withdrawal Agreement) Act 2020.
 Article 18 TFEU states: ‘Within the scope of application of the Treaties, and without prejudice to any special provisions contained therein, any discrimination on grounds of nationality shall be prohibited. The European Parliament and the Council, acting in accordance with the ordinary legislative procedure, may adopt rules designed to prohibit such discrimination.’
 Articles 20(1) TFEU and 21(1) TFEU.
 Article 267 TFEU. A preliminary reference is an opportunity for a court in a Member State to seek clarification from the CJEU as to the correct interpretation of EU Law in a given case.
 Discrimination is ‘direct’ if a person receives less favourable treatment than someone in similar circumstances to them because they hold a characteristic, in this case nationality, which the person in similar circumstances does not hold. Discrimination is ‘indirect’ if a policy applies the same way to everyone, but disadvantages a person because they have a particular characteristic and there is not a good reason for the difference in treatment.
 Article 1: Human dignity ‘Human dignity is inviolable. It must be respected and protected’.
 Article 7: Respect for private and family life ‘Everyone has the right to respect for his or her private and family life, home and communications’.
 Article 24: The rights of the child ‘(1) Children shall have the right to such protection and care as is necessary for their well-being. They may express their views freely. Such views shall be taken into consideration on matters which concern them in accordance with their age and maturity. (2) In all actions relating to children, whether taken by public authorities or private institutions, the child’s best interests must be a primary consideration. (3) Every child shall have the right to maintain on a regular basis a personal relationship and direct contact with both his or her parents, unless that is contrary to his or her interests.’