Collins v Secretary of State for Work & Pensions

At issue on this appeal is the proper interpretation to be placed on a judgment of the European Court of Justice (“the ECJ”) in response to a reference made by the Social Security Commissioner (Mr J. Mesher) on a claim by the appellant, Mr Brian Collins, for job seeker’s allowance (“JSA”).

Mr Collins was born in 1957 in the US and was brought up there. He has dual US and Irish nationality. By virtue of his Irish nationality he is a citizen of the European Union.

He went to university in the US, graduating in 1980. In 1978, as part of his university studies, he spent one semester in the UK. After graduating, he spent some ten months in London doing casual and part-time work. He returned to the US in 1981 and stayed there until 1985. During that time he was in employment. From 1985 until 1987 he worked in Africa as an aid worker. In 1988, after spending some six months in the US, he moved to South Africa, where he studied history and worked as a teacher. In 1997 he returned to the US to live with his mother, having been refused a right of permanent residence in South Africa. For some six months he worked in the US in sales and as a history teacher. He then decided to settle in the UK. Before coming to the UK he took the necessary steps to acquire a new Irish passport, which was issued on 9 February 1998. He arrived in the UK on 31 May 1998, with the intention of finding work in the social services sector. On 8 June 1998 he claimed JSA.

On 1 July 1998 the adjudicating officer held that Mr Collins was a “person from abroad” as defined in the relevant regulations, and that the amount of JSA to which he was entitled was accordingly nil. On 18 February 1999 an appeal tribunal dismissed Mr Collins’ appeal. He appealed to the Commissioner. By his decision dated 29 April 2002, the Commissioner held that the tribunal had failed adequately to deal with certain aspects of European law, and that its decision should be set aside. However, before substituting his own findings the Commissioner referred three questions to the ECJ for a preliminary ruling. I shall refer hereafter to the Commissioner’s decision dated 29 April 2002 as “the Order for Reference”.

By its judgment dated 23 March 2004 (Case C-138/02, [2004] All ER (EC) 1005) the ECJ gave its answers to the three questions referred to it by the Commissioner. The effect of those answers was to leave two remaining issues for decision by the Commissioner. A further oral hearing took place before the Commissioner on 19 November 2004 at which he heard argument on those two issues.

By his decision dated 4 March 2005 (“the Decision”) the Commissioner determined both issues in favour of the Secretary of State, and dismissed Mr Collins’ appeal. Mr Collins now appeals to this court against the Commissioner’s determination of one of those issues. He does so with permission granted by the Commissioner on 10 June 2005.

It is common ground that the resolution of that issue turns upon the proper interpretation to be placed upon the ECJ’s answer to the third of the questions referred to it by the Commissioner.

In paragraphs 6 to 8 of the Order for Reference the Commissioner explained the nature of JSA, and the conditions for its availability, as follows:

“6.

[JSA] is a social security benefit provided under the Jobseekers Act 1995, operative from 7 October 1996. It is a replacement for unemployment benefit (a contributory benefit) and income support (a means-tested benefit) for the unemployed. There are two routes to entitlement, through contribution-based conditions and through income-based conditions. In the present case, the income-based conditions are those which are relevant, as the claimant had made no contributions that would qualify him for contribution-based JSA. As well as satisfying the conditions of being available for and actively seeking employment, of having entered into a jobseeker’s agreement, not being engaged in remunerative work etc, a claimant’s income must not exceed the applicable amount and his capital must not exceed a specified amount. These conditions are very similar to those in the income support scheme. The benefit payable is to be the applicable amount, if the claimant has no income, or otherwise the amount by which the applicable amount exceeds the claimant’s income (section 4(3)). The only condition related to residence in the Jobseekers Act 1995 is that the claimant “is in Great Britain” (section 1(2)(i)).

7.

However, the Act requires regulations to prescribe how applicable amounts are to be determined (section 4(5)). Regulation 85(1) of the Jobseeker’s Allowance Regulations 1996 (“the JSA Regulations”) provides that in circumstances specified in column (1) of Schedule 5 to the JSA Regulations the applicable amount is to be the amount prescribed in column (2). Paragraph 14(a) of Schedule 5 prescribes an applicable amount of nil for a person from abroad who is a single claimant. In regulation 85(4) an additional definition of “person from abroad” is, as in force at the relevant time:

‘a claimant who is not habitually resident in the United Kingdom, the Channel Islands, the Isle of Man or the Republic of Ireland, but for this purpose, no claimant shall be treated as not habitually resident in the United Kingdom who is –

(a)

a worker for the purposes of Council Regulation (EEC) No. 1612/68 or (EEC) No. 1251/70 or a person with a right to reside in the United Kingdom pursuant to Council Directive No. 68/360/EEC or No. 73/148/EEC; or

(b)

a refugee within the definition in Article 1 of the Convention relating to the Status of Refugees done at Geneva on 28^th July 1951, as extended by Article 1(2) of the Protocol relating to the Status of Refugees done at New York on 31^st January 1967; or

(c)

a person who has been granted exceptional leave to enter the United Kingdom by an immigration officer within the meaning of the Immigration Act 1971, or to remain in the United Kingdom by the Secretary of State.’

8.

The effect is thus that a claimant who is not habitually resident in the UK or in one of the other prescribed territories cannot qualify for the payment of any income-based JSA. The rule is the same as that prescribed in the case of income support and considered by the [ECJ] in [Robin Swaddling v. Adjudication Officer [1999] ECRI-1075]”

The tribunal held that Mr Collins was not a ‘worker’ for the purposes of Council Regulation (EEC) 1612/68, and that he did not have a right to reside in the UK pursuant to Council Directive 68/360 EEC: hence he did not fall within paragraph (a) of regulation 85(4). Since it was common ground that paragraphs (b) and (c) of regulation 85(4) did not apply to him, it followed that the ‘applicable amount’ in his case was nil unless, as at 1 July 1998, he was ‘habitually resident’ in the UK. Applying the domestic test of habitual residence, the tribunal found that he was not habitually resident in the UK on 1 July 1998. It accordingly dismissed his appeal.

On Mr Collins’ appeal to the Commissioner, the Commissioner held (in paragraph 4 of the Order for Reference) that the Tribunal had failed to deal adequately with certain aspects of European law, in that: (a) it had failed to explain properly why it had rejected Mr Collins’ case that he was a ‘worker’ for the purpose of Council Regulation (EEC) 1612/68; and (b) it had failed to deal with his case that he had a right to reside in the UK pursuant to Council Directive 68/360 EEC. The Commissioner also held that the Tribunal had erred in not applying the correct approach to the concept of residence in relation to cases arising under article 10a of Council Regulation (EEC) 1408/71. He accordingly held (in paragraph 5 of the Order for Reference) that Mr Collins’ appeal must be decided afresh. However, he continued:

“To decide the appeal it is necessary to resolve a question or questions of Community law to which in my judgment the answer is not clearly provided by the Court’s jurisprudence. Accordingly, I have referred to the Court the questions set out at the end of this Order.”

In paragraph 11 of the Order for Reference, the Commissioner accepted that Mr Collins’ intention in returning to the UK was to work in the social services sector as a care worker and that he intended to live and work in the UK for some significant length of time. The Commissioner also accepted that by 8 June 1998 Mr Collins had started looking for work by registering with employment agencies, looking in local newspapers and visiting the Jobcentre: that is to say, he accepted that Mr Collins’ search for work was genuine.

In paragraph 13 of the Order for Reference the Commissioner found that, applying the test of ‘habitual residence’ approved by the House of Lords in Nessa v. Chief Adjudication Officer [1999] 1 WLR 1937, “on no one day within the period from 8 June 1998 to 1 July 1998 was [Mr Collins] habitually resident in the UK or in another prescribed territory”.

The three questions referred by the Commissioner to the ECJ for preliminary ruling were in the following terms:

(1)

Is a person in the circumstances of the claimant in the present case a worker for the purposes of Regulation No 1612/68?

(2)

If the answer to question (1) is not in the affirmative, does a person in the circumstances of the claimant in the present case have a right to reside in the United Kingdom pursuant to Directive No 68/360?

(3)

If the answers to both questions (1) and (2) are not in the affirmative, do any provisions or principles of European Community law require the payment of a social security benefit with conditions of entitlement like those for income-based [JSA] to a person in the circumstances of the claimant in the present case?

Setting those questions in the context of the JSA regulations, it can be seen that whereas questions (1) and (2) are directed at determining whether Mr Collins fell within paragraph (a) of regulation 85(4) (and hence whether, since he was not habitually resident in the UK, his ‘applicable amount’ was nil), question (3) is of an entirely different character. In essence, question (3) asks whether there is some principle of Community law which enables Mr Collins to claim JSA despite the fact (as found by the Commissioner) that at the material time he was not habitually resident in the UK: in other words, whether Community law effectively strikes down the ‘habitually resident’ test altogether. At issue in this appeal is the proper interpretation to be placed on the ECJ’s answer to that question.

In the course of argument before the ECJ, reliance was placed on the following provisions of Community law:

The EC Treaty

Article 12(1) of the EC Treaty is in the following terms:

“Within the scope of application of this Treaty, and without prejudice to any special provisions contained therein, any discrimination on grounds of nationality shall be prohibited.”

Article 17 of the EC Treaty is in the following terms (so far as material):

“1.

Citizenship of the Union is hereby established. Every person holding the nationality of a Member State shall be a citizen of the Union …

2.

Citizens of the Union shall enjoy the rights conferred by this Treaty and shall be subject to the duties imposed thereby.”

Article 18(1) of the EC Treaty is in the following terms (so far as material):

“1.

Every citizen of the Union shall have the right to move and reside freely within the territory of Member States, subject to the limitations and conditions laid down in this Treaty and by the measures adopted to give it effect.”

Article 39(2) of the EC Treaty provides that freedom of movement for workers entails the abolition of any discrimination based on nationality between workers of the member states as regards employment, remuneration and other conditions of work and employment.

Directive 68/360

Article 1 of Directive 68/360 provides as follows:

“Member States shall, acting as provided in this Directive, abolish restrictions on the movement and residence of nationals of the said States and of members of their familes to whom Regulation (EEC) No 1612/68 applies.”

Article 4 of Directive 68/360 provides that member states are to grant the right of residence in their territory to the persons referred to in ibid. article 1 who are able to produce certain specified documents including ‘the document with which he entered their territory’ and ‘confirmation of engagement from the employer or a certificate of employment’.

Article 8(1) of Directive 68/360 requires member states to recognise, without issuing a residence permit, the right of residence in their territory of (a) workers pursuing an activity as an employed person where the activity is not expected to last for more than three months, (b) frontier workers and (c) seasonal workers.

Regulation 1612/68

Article 2 of Regulation 1612/68 provides as follows:

“Any national of a Member State and any employer pursuing an activity in the territory of a Member State may exchange their applications for and offers of employment, and may conclude and perform contracts of employment in accordance with the provisions in force laid down by law, regulation and administrative action, without any discrimination resulting therefrom.”

Article 5 of Regulation 1612/68 provides as follows:

“A national of a Member State who seeks employment in the territory of another Member State shall receive the same assistance there as that afforded by the employment offices in that State to their own nationals seeking employment.”

Article 7 of Regulation 1612/68 provides as follows:

“1.

A worker who is a national of a Member State may not, in the territory of another Member State, be treated differently from national workers by reason of his nationality in respect of any conditions of employment and work, in particular as regards remuneration, dismissal, and should be become unemployed, reinstatement or re-employment;

2.

He shall enjoy the same social and tax advantages as national workers.”

Regulation 1408/71

Article 10a of Regulation 1408/71 provides as follows (so far as material):

“1.

Notwithstanding the provisions of Article 10 and Title III, persons to whom this Regulation applies shall be granted the special non-contributory cash benefits referred to in Article 4(2a) exclusively in the territory of the Member State in which they reside, in accordance with the legislation of that State, provided that such benefits are listed in Annex IIa. Such benefits shall be granted by and at the expense of the institution of the place of residence.”

Written and oral observations were made to the ECJ on behalf of Mr Collins, the UK Government and the European Commission. Written observations were also made on behalf of the German Government.

After summarising the facts and the arguments, the Advocate-General turned to the three questions which had been referred. In paragraph 77 he set out his answers to those questions, as follows:

“(1)

A national of a member state who enters the territory of another member state with the intention of seeking paid employment, despite being covered by arts 1 to 6 of Regulation 1612/68, is not a worker for the purposes of arts 7 et seq thereof.

(2)

A national of a member state who moves to a member state with the intention of seeking employment has the right to reside within its territory, pursuant to art 39 EC, but Council Directive (EEC) 68/360 (on the abolition of restrictions on movement and residence for workers of member states and their families) does not provide for such a possibility.

(3)

Community law as it now stands does not require that an income-based social security benefit, intended for jobseekers, be provided to a citizen of the Union who enters the territory of a member state with the purpose of seeking employment while lacking any connection with the state or link with the domestic employment market.”

To set the ECJ’s judgment in context, it is material to bear in mind that (as noted in paragraph 11 above) in the Order for Reference the Commissioner accepted that Mr Collins was actively looking for work in the UK. The ECJ accordingly proceeded on that basis, recording as a fact that Mr Collins returned to the UK “in order to find work there” (see paragraph 19 of its judgment).

Addressing question (1), the ECJ observed (in paragraph 28 of its judgment) that even if Mr Collins’ activities in the UK during his ten-month stay here in 1981 were such as to confer on him the status of ‘worker’, no link could be established between those activities and his search for another job in the UK some 17 years later. The ECJ continued as follows (in paragraphs 29 to 33 of its judgment):

“29.

In the absence of a sufficiently close connection with the United Kingdom employment market, Mr Collins’ position in 1998 must therefore be compared with that of any national of a member state looking for his first job in another member state.

30.

In this connection, it is to be remembered that the court’s case-law draws a distinction between member state nationals who have not yet entered into an employment relationship in the host member state where they are looking for work and those who are already working in that state or who, having worked there but no longer being in an employment relationship, are nevertheless considered to be workers (see Lair v Universität Hannover Case 39/86 [1988] ECR 3161, paras 32, 33).

31.

While member state nationals who move in search for work benefit from the principle of equal treatment only as regards access to employment, those who have already entered the employment market may, on the basis of art 7(2) of Regulation 1612/68, claim the same social and tax advantages as national workers (see in particular, [Centre Public d’Aide Sociale de Courcelles v. Lebon Case 316/85 [1987] ECR 2811] (para 26) and European Commission v Belgium Case C-278/94 [1996] ECR I-4307 (paras 39, 40)).

32.

The concept of ‘worker’ is thus not used in Regulation 1612/68 in a uniform manner. While in Title II of Part I of the regulation this term covers only persons who have already entered the employment market, in other parts of the same regulation the concept of ‘worker’ must be understood in a broader sense.

33.

Accordingly, the answer to the first question must be that a person in the circumstances of the appellant in the main proceedings is not a worker for the purposes of Title II of Part I of Regulation 1612/68. It is, however, for the national court or tribunal to establish whether the term ‘worker’ as referred to by the national legislation at issue is to be understood in that sense.” (My italics)

In answer to question (2) the ECJ, in agreement with the Advocate-General, concluded that a person in Mr Collins’ position does not have a right to reside in the UK “solely on the basis of Directive 68/360”.

Turning to question (3), the ECJ summarised the arguments as follows (in paragraphs 45 to 50 of its judgment):

“45.

In Mr Collins’ submission, there is no doubt that he is a national of another member state who was lawfully in the United Kingdom and that jobseeker’s allowance is within the scope of the Treaty. The result, as the Court held in Grzelczykv Centre Public d’Aide Sociale d’Ottignies-Louvain-la-Neuve Case C-184/99 [2003] All ER (EC) 385, [2001] ECR I-6193, is that the payment of a non-contributory means-tested benefit to a national of a member state other than the host member state cannot be made conditional on the satisfaction of a condition when such a condition is not applied to nationals of the host member state. Mr Collins acknowledges that the habitual residence test is applied to United Kingdom nationals as well. However, it is well established that a provision of national law is to be regarded as discriminatory for the purposes of Community law if it is inherently more likely to be satisfied by nationals of the member state concerned.

46.

The United Kingdom government and the German government argue that there is no provision or principle of Community law which requires that a benefit such as the jobseeker's allowance be paid to a person in the circumstances of Mr Collins.

47.

With regard to the possible existence of indirect discrimination, the United Kingdom government submits that there are relevant objective justifications for not making income-based jobseeker’s allowance available to persons in the situation of Mr Collins. Unlike the position in D’Hoop v Office National de l’Emploi Case C-224/98 [2003] All ER (EC) 527, [2002] ECR I-6191, the eligibility criteria adopted for the allowance at issue here do not go beyond what is necessary to attain the objective pursued. They represent a proportionate and hence permissible method of ensuring that there is a real link between the claimant and the geographic employment market. In the absence of such criteria, persons who have little or no link with the United Kingdom employment market, as in the case of Mr Collins, would then be able to claim that allowance.

48.

According to the Commission, it is not disputed that Mr Collins was genuinely seeking work in the United Kingdom during the two months following his arrival in that member state and that he was lawfully resident there in his capacity as a person seeking work. As a citizen of the Union lawfully residing in the United Kingdom, he was clearly entitled to the protection conferred by Article 6 of the Treaty against discrimination on grounds of nationality in any situation falling within the material scope of Community law. That is precisely the case with regard to jobseeker’s allowance, which should be considered to be a social advantage within the meaning of art 7(2) of Regulation 1612/68.

49.

The Commission also observes that it is clear that the right to stay in another member state to seek work there can be limited to a reasonable period and that Mr Collins’ right to rely on arts 6 and 8 of the Treaty in order to claim the allowance, on the same basis as United Kingdom nationals, is therefore similarly restricted to that period of lawful residence.

50.

Nonetheless, the Commission submits that a requirement of habitual residence may be indirectly discriminatory because it can be more easily met by nationals of the host member state than by those of other member states. Whilst such a requirement may be justified on objective grounds necessarily intended to avoid ‘benefit tourism’ and thus the possibility of abuse by work-seekers who are not genuine, the Commission notes that in the case of Mr Collins the genuine nature of the search for work is not in dispute. Indeed, it appears that he has remained continuously employed in the United Kingdom ever since first finding work there shortly after his arrival.”

Addressing question (3), the ECJ began by observing (in paragraph 53 of its judgment) that under the JSA regulations nationals of other member states seeking employment in the UK who are not ‘workers’ for the purposes of Regulation 1612/68 and who do not derive a right of residence from Directive 68/360 can claim JSA only if they are habitually resident in the UK. That being so, it became necessary to determine “whether the principle of equal treatment precludes national legislation which makes entitlement to [JSA] conditional on a residence requirement” (paragraph 54). In context, that reference to a “residence requirement” must in my judgment mean a requirement of habitual residence. There would, after all, have been little purpose in the ECJ considering some other kind of residence requirement not present in the instant case.

The ECJ noted that the JSA regulations must be considered in the light of articles 12(1) and 39(2) (formerly articles 6 and 48(2)) of the EC Treaty, but observed that in Lebon and in European Commission v. Belgium the court had held that member state nationals who move in search of employment qualify for equal treatment only as regards access to employment in accordance with article 39(2) (formerly article 48(2)) of the EC Treaty and articles 2 and 5 of Regulation 1612/68, but not with regard to social and tax advantages within article 7(2) of that regulation.

In paragraphs 61 and 62 of its judgment, the ECJ cited its decision in Grzelczyk as authority for the proposition that “[c]itizenship of the Union is destined to be the fundamental status of nationals of the member states, enabling those who find themselves in the same situation to enjoy the same treatment in law irrespective of their nationality, subject only to such exceptions as are expressly provided for”; and that articles 12(1) and 17 (formerly articles 6 and 8) of the EC Treaty preclude eligibility for a non-contributory social benefit being subject to conditions which are liable to constitute discrimination on grounds of nationality.

Paragraphs 63 to72 of the ECJ’s judgment are central to this appeal. In those paragraphs, the ECJ said this:

“63.

In view of the establishment of citizenship of the Union and the interpretation in the case law of the right to equal treatment enjoyed by citizens of the Union, it is no longer possible to exclude from the scope of art 48(2) of the Treaty - which expresses the fundamental principle of equal treatment, guaranteed by art 6 of the Treaty - a benefit of a financial nature intended to facilitate access to employment in the labour market of a member state.

64.

The interpretation of the scope of the principle of equal treatment in relation to access to employment must reflect this development, as compared with the interpretation followed in Lebon’s case and in EuropeanCommission v Belgium Case C-278/94.

65.

The 1996 regulations introduce a difference in treatment according to whether the person involved is habitually resident in the United Kingdom. Since that requirement is capable of being met more easily by the state's own nationals, the 1996 Regulations place at a disadvantage member state nationals who have exercised their right of movement in order to seek employment in the territory of another member state (see, to this effect, O’Flynnv Adjudication Officer Case C-237/94 [1996] All ER (EC) 541, [1996] ECR I-2617 (para 18) and European Commission v Italy Case C-388/01 [2003] ECR I-721 (paras 13, 14)).

66.

A residence requirement of that kind can be justified only if it is based on objective considerations that are independent of the nationality of the persons concerned and proportionate to the legitimate aim of the national provisions (see Criminal Proceedings against Bickel Case C-274/96 [1998] ECR I-7637 (para 27)).

67.

The Court has already held that it is legitimate for the national legislature to wish to ensure that there is a genuine link between an applicant for an allowance in the nature of a social advantage within the meaning of art 7(2) of Regulation 1612/68 and the geographic employment market in question (see, in the context of the grant of tideover allowances to young persons seeking their first job, D’Hoop (para 38)).

68.

The jobseeker’s allowance introduced by the 1995 Act is a social security benefit which replaced unemployment benefit and income support, and requires in particular the claimant to be available for and actively seeking employment and not to have income exceeding the applicable amount or capital exceeding a specified amount.

69.

It may be regarded as legitimate for a member state to grant such an allowance only after it has been possible to establish that a genuine link exists between the person seeking work and the employment market of that state.

70.

The existence of such a link may be determined, in particular, by establishing that the person concerned has, for a reasonable period, in fact genuinely sought work in the member state in question.

71.

The United Kingdom is thus able to require a connection between persons who claim entitlement to such an allowance and its employment market.

72.

However, while a residence requirement is, in principle, appropriate for the purpose of ensuring such a connection, if it is to be proportionate it cannot go beyond what is necessary in order to attain that objective. More specifically, its application by the national authorities must rest on clear criteria known in advance and provision must be made for the possibility of a means of redress of a judicial nature. In any event, if compliance with the requirement demands a period of residence, the period must not exceed what is necessary in order for the national authorities to be able to satisfy themselves that the person concerned is genuinely seeking work in the employment market of the host member state.”

As will appear, the arguments addressed to the Commissioner at the further hearing which led to the Decision, and addressed to us on this appeal, have been directed in particular to the meaning of the final sentence of paragraph 72 of the ECJ’s judgment.

The ECJ stated its answer to question (3) in paragraph 73 of its judgment, as follows:

“The answer to the third question must therefore be that the right to equal treatment laid down in art [39(2)] of the Treaty, read in conjunction with arts [12] and [17] of the Treaty, does not preclude national legislation which makes entitlement to [JSA] conditional on a residence requirement, in so far as that requirement may be justified on the basis of objective considerations that are independent of the nationality of the persons concerned and proportionate to the legitimate aim of the national provisions.”

The two issues which remained for the Commissioner to determine, in the light of the ECJ’s judgment, were:

On the first of those issues, the Commissioner determined (in paragraph 17 of the Decision) that, given the ECJ’s ruling (in paragraph 29 of its judgment, quoted in paragraph 30 above) that Mr Collins’ position in 1998 was to be “compared with that of any national of a member state looking for his first job in another member state”, Mr Collins did not fall within the meaning of the term ‘worker’ in paragraph (a) of regulation 85(4). There is no appeal against that determination by the Commissioner.

On the second issue (“the justification issue”), in paragraph 20 of the Decision the Commissioner identified the essential difference between the parties as being as to the meaning of paragraph 72 of the ECJ’s judgment, and in particular the last sentence of that paragraph. The Commissioner posed the question thus: “Does it [i.e. the last sentence of the paragraph] mean that there can be no justification for the imposition of an additional condition of habitual residence for weeks in which it is accepted that the claimant was seeking suitable work and in which the other conditions of entitlement to income-based JSA are met?”.

In paragraphs 21 and 22 of the Decision the Commissioner summarised the arguments of Mr Richard Drabble QC (appearing for Mr Collins, as he does in this court) and of Miss Eleanor Sharpston QC (as she then was, appearing for the Secretary of State) as follows:

“21.

The basis of Mr Drabble’s submission was that the effect of paragraph 72 was that the sole legitimate question to which a habitual residence test could be relevant, and the sole legitimate aim of the national provisions by reference to which justification could be considered, was whether the national authorities were satisfied that the claimant was genuinely seeking work. At the oral hearing he refined his consequential submissions into three alternative propositions:

(1)

the answer to that sole legitimate question was in fact provided by the satisfaction of the other conditions of entitlement to JSA, so that there was no justifiable role left for a habitual residence test;

(2)

if (1) was not accepted, the habitual residence test did not satisfy the conditions set out in paragraph 72, in particular the condition that the application of a residence test must rest on clear criteria known in advance, so that it could not be justified; and

(3)

if the application of a habitual residence test was not precluded by (1) or (2), it could only be applied in a way that acknowledged the overall context of paragraph 72, by disregarding factors that did not help to answer the sole legitimate question, ie was the claimant's search for work genuine.

22.

Miss Sharpston argued against Mr Drabble’s propositions (1) and (2). On proposition (1), she submitted that the ECJ had known of the conditions of entitlement to income-based JSA in terms of actively seeking work and availability for work (see paragraph 68 of the judgment). It could not possibly have talked in paragraph 72 in terms of a residence requirement being in principle appropriate and have sent the issue of justification back to the national tribunal if the true principle to be derived from its judgment was that there was no justifiable role for the habitual residence test within income-based JSA in cases subject to the EC principle of non-discrimination on grounds of nationality. On proposition (2), she submitted that there were clear criteria (derived from case-law and administrative guidance identifying relevant factors) and the possibility of a means of redress of a judicial nature in the right of appeal to an appeal tribunal and beyond. On proposition (3), she accepted that in circumstances where the habitual residence test fell foul of the non-discrimination principle identified in paragraph 65 of the ECJ’s judgment and had to be justified, it had to be applied in a way that allowed it be used as a means of satisfying the relevant authority that the claimant was genuinely seeking work and that the relevance of various factors would be coloured by that context. However, Miss Sharpston had also taken issue with the basis of Mr Drabble’s submissions. She submitted that the words of paragraph 72 of the ECJ’s judgment had to be looked at in the context of the preceding paragraphs, from which it was clear that a test could be justified although it involved a requirement that residence continue for a period during which the claimant was genuinely seeking work.”

In paragraph 23 of the Decision the Commissioner rejected Mr Drabble’s initial submission, concluding that it took a wrong and too narrow view of the legitimate aims of the national provisions. He accepted the substance of Miss Sharpston’s submission that paragraph 72 of the ECJ’s judgment had to be read in the context of the earlier paragraphs, from which it was clear that a residence test could be justified notwithstanding that it might involve a requirement that residence continue for a period during which the claimant was genuinely seeking work.

The Commissioner then undertook an analysis of the structure of paragraphs 66 to 73 of the ECJ’s judgment. In relation to paragraph 72 of the ECJ’s judgment, the Commissioner said this (in paragraphs 31 to 34 of the Decision):

“31.

Then comes the significant leap in paragraph 72. The first and most important statement of principle is that a residence requirement is in principle appropriate for the purpose of ensuring such a connection, ie a connection of up to but not beyond the degree allowable in accordance with paragraphs 67 and 69. That is significant in endorsing the potential efficacy of a residence requirement in a context like that of Collins. But it also necessarily entails that a residence test can be allowed, within limits, to act as a proxy for the test of whether or not there is a genuine or real link to the geographical employment market. It allows a different test than simply asking “is there a genuine link”. As Advocate General Geelhoed put it in paragraph 61 of his Opinion in[R (on the application of Dany Bidar) v. London Borough of Ealing and Secretary of State for Education and Skills [2005] ECR1-2119; [2005] QB 812]:

“Obviously a Member State must for reasons of legal certainty and transparency lay down formal criteria for determining eligibility for maintenance assistance [the social benefit in issue there] and to ensure that such assistance is provided to persons proving to have a genuine connection with the national educational system and national society. ... It may be inferred from [the conditions laid down in Collins] that the Court recognises that a residence requirement may be imposed as a starting point of the assessment of the situation of an individual applicant. The fact that it states that the period must not exceed what is necessary for the purpose of enabling the national authorities to satisfy themselves that a person is genuinely seeking work in the domestic employment market indicates, however, that other factors must be able to be taken into account in that assessment. This is further borne out by its consideration in D’Hoop that the single condition applied by the national authorities in that case was too general and exclusive and that no account could be taken of other representative factors. Ultimately, it would appear to me that if the result of the application of a residence requirement is to exclude a person, who can demonstrate a genuine link with the national education system or society, from the enjoyment of maintenance assistance, the result would be contrary to the principle of proportionality.”

32.

I leave aside for the moment what was said in paragraph 72 of the ECJ’s judgment about proportionality, clear criteria and means of redress. The crucial sentence is then this:

“In any event, if compliance with the [residence] requirement demands a period of residence, the period must not exceed what is necessary in order for the national authorities to be able to satisfy themselves that the person concerned is genuinely seeking work in the employment market of the host Member State.”

33.

First, I have no doubt that that sentence does not have the effect that the sole legitimate question to be asked is whether the claimant was genuinely seeking work on any particular day, in the sense merely of taking active and appropriate steps to seek suitable work. The relevant legitimate aim in making the JSA legislation, as identified by the ECJ, is the wish to ensure that there is a genuine link (or in other words a real link) between the claimant and the UK employment market. That is the aim in relation to which proportionality must be tested.

34.

Then, paragraph 69 of the judgment spells out that in pursuance of that aim it is legitimate to award benefit only after it has been possible to establish that such a link exists. And it is plainly accepted in paragraphs 69 and 70 that it is legitimate only to accept that there is such a link at any particular date if there has previously been some sufficiently concrete expression of a connection with the UK employment market. It also seems to me that the notion of a genuine link or a real link carries with it a sense that the link has to have some concrete expression. In that context, I conclude that the pivotal part of the final sentence of paragraph 72 is the reference to what period of residence is necessary for the national authorities to be able to satisfy themselves that the claimant is genuinely seeking work. To be consistent with what has been said earlier, it must be legitimate for the national authorities to say that they are not able to satisfy themselves about the genuineness of a search for work until a proper search has continued for some period. A person may actually take steps to search for work on a particular day and actually have on that day an intention to continue to search diligently for suitable vacancies, but national authorities can legitimately say that they have not been satisfied that the search is genuine until they have seen that the search has been sustained, and in a sufficiently diligent and well-directed form, for some period. The condition of proportionality laid down by the final sentence of paragraph 72 is thus that a residence requirement, in principle appropriate, cannot be applied to deny entitlement to benefit beyond the date at which the relevant national authority has become satisfied of the genuineness of the claimant's search for work.”

The Commissioner then addressed Mr Drabble’s three propositions. In relation to his first proposition, the Commissioner said this (in paragraph 35 of the Decision):

“35.

Accordingly, Mr Drabble’s first proposition in paragraph 21 above cannot stand. It is not the case that any claimant for income-based JSA who satisfies the conditions of availability for and actively seeking work on a day must be accepted as having satisfied the national authorities about a genuine link with the UK employment market and must (if within the protection of the EC principle of non-discrimination on the ground of nationality) be awarded benefit. The UK authorities may not as at that day be satisfied the claimant has a genuine or real link with the UK employment and, if so, can legitimately deny benefit if it is considered that the claimant is not habitually resident in the UK. On that basis, there is no difficulty in seeing why the ECJ did not itself express the conclusion that the use of the habitual residence test in income-based JSA could not be objectively justified and left that issue to the national tribunal.”

The Commissioner also rejected Mr Drabble’s second proposition. In paragraph 42 of the Decision he observed that “if a residence requirement is to be acceptable as a proxy for a direct finding of a genuine or real link with the geographic employment market (as the ECJ accepted in Collins), it must allow sufficient flexibility not to fall foul of being too general and exclusive”. He was also impressed by the fact that a test of habitual residence is well-recognised in Community law (see, e.g., Swaddling). In paragraph 43 of the Decision he said this:

“It would be extraordinary if the ECJ in Collins had intended to indicate that a test involving criteria of a similar kind to those laid down in Swaddling would not meet the conditions of proportionality, for it not to have spelled out that conclusion in the clearest possible terms.”

The Commissioner then turned to Mr Drabble’s third proposition, saying this (in paragraphs 44 to 46 of the Decision):

“44.

I look at this first as a general proposition before considering the submissions about the application of the habitual residence test to the findings of fact already made in the present case. Here, there appeared to be a measure of agreement between Mr Drabble and Mrs Sharpston at the oral hearing, as noted in paragraph 22 above. However, the agreement was only on the surface. There was some agreement that factors relating particularly to links to the UK employment market had to be given primacy, but, in the light of my conclusions in paragraphs 32 to 34 above, that does not have the dramatic consequences argued for by Mr Drabble. He submitted that, as my findings of fact indicated that the claimant was genuinely seeking work at the date of claim, he had to be found to be habitually resident in the UK from that date. But that only follows from asking the wrong question. However, I prefer a slightly different approach.

45.

In my judgment, the condition in the final sentence of paragraph 72 of the ECJ’s judgment should not be given effect by taking certain factors out of the equation when operating either the domestic UK or the Community habitual residence test, on the ground that they are not relevant to the genuineness of a link to the UK employment market. First, I have some difficulty in working out exactly what factors would be excluded, when it is a link to a particular geographical employment market that is in issue. Second, and more important, it seems to me that there is a risk of making the test itself rather incoherent if too many versions of it are to be operated in different legal circumstances. I would prefer to operate the condition in a somewhat more literal way, in line with Advocate General Geelhoed’s approach in his Opinion in Bidar (see paragraph 31 above). When he talks there of taking other factors into account in an assessment, in addition to a residence requirement, he is talking of the assessment of the result ultimately reached on the entitlements of the person concerned. In the present context, the appropriate habitual residence test should be applied in the ordinary way. But, if the result on any day is against the claimant, there should then be a check against the answer to the question “has the point been reached on that day that the relevant national authority has become satisfied of the genuineness of the claimant's search for work (as explained in paragraph 34 above)?” If the answer to that question is yes, then the result of the ordinary application of the habitual residence test cannot be applied against a claimant within the scope of the Community principle of non-discrimination on the ground of nationality. Similarly, if for some other reason such a claimant has a genuine or real link to the UK employment market, that result cannot be applied (although it is hard to envisage how such a link could exist if the claimant is not currently genuinely seeking work). If the answer is no, then the result can be applied.

46.

I add as a small footnote that the Secretary of State rightly did not seek to argue that the habitual test does not require a “period of residence”, merely that a claimant’s residence has attained the particular quality of habitualness. There is no doubt that the principle adopted by the ECJ in the final sentence of paragraph 72 of its judgment is to be applied to any rule that can in substance take into account of length of residence, of whatever quality, as a factor.”

The Commissioner expressed his conclusion on the justification issue in paragraph 47 of the Decision, as follows:

“47.

The result of my rejection of Mr Drabble’s propositions (1) and (2) is that I hold that the application of the residence requirement embodied in the habitual residence test in the JSA legislation and in Article 10a of Regulation 1408/71 is, subject to the proviso mentioned below, justified by objective considerations independent of the nationality of the claimant and proportionate to the legitimate aim in the making of the JSA legislation. The requirement meets the conditions as to proportionality set out in paragraph 72 of the ECJ’s judgment in relation to the legitimate aim of establishing that a real or genuine link exists between a claimant and the UK employment market, such as by being satisfied of the genuineness of the claimant’s search for work in that employment market. The proviso is that for the application of the requirement for any day to be proportionate in any particular case, the question mentioned at the end of paragraph 45 above must be answered in the negative.”

The Commissioner then applied the law to the facts of the case. In paragraph 48 of the Decision he concluded that “one could not on 1 July 1998 be satisfied of the genuineness of the claimant’s search for work in the UK employment market or that he thereby had a real or genuine link with that employment market”. Thus the answer to the question posed by the Commissioner in paragraph 45 of the Decision, viz. “[H]as the point been reached on that day that the relevant national authority has become satisfied of the genuineness of the claimant’s search for work?”, was in the negative. It followed that the proviso set out in paragraphs 45 and 47 of the Decision did not apply, and hence that the fact that Mr Collins was not habitually resident in the UK at the material time meant that his ‘applicable amount’ was nil, and that his appeal should accordingly be dismissed and the decision that he was not entitled to JSA from and including 8 June 1998 confirmed.

At the risk of failing to do justice to the totality of Commissioner’s detailed analysis, I draw particular attention at this point to two of his conclusions as to the meaning of paragraph 72 of the ECJ’s judgment. First, in paragraph 31 of the Decision he concluded that paragraph 72 indicates “that a residence test can be allowed, within limits, to act as a proxy for the test of whether or not there is a genuine or real link to the geographical employment market”. It is implicit in that conclusion that he regarded the establishment of such a “genuine or real link” as involving something more than that the claimant should be actively (i.e. genuinely) seeking work in the relevant market on the day in question – a fact which, as noted earlier, was not in dispute in the instant case. Indeed, he expressly recognised this in paragraphs 33 and 34 of the Decision. Thus in paragraph 33 he said that he had “no doubt that [the last sentence of paragraph 72] does not have the effect that the sole legitimate question to be asked is whether the claimant was genuinely seeking work on [the relevant] day”; and in paragraph 34 he concluded that “it must be legitimate for the national authorities to say that they are not able to satisfy themselves about the genuineness of a search for work until a proper search has continued for some period” (my italics). He enlarged on this later in the same paragraph, saying that “national authorities can legitimately say that they have not been satisfied that the search is genuine until they have seen that the search has been sustained, and in a sufficiently diligent and well-directed form, for some period”.

However (and this is the second of the Commissioner’s conclusions to which I draw particular attention at this point), in paragraphs 45 and 47 of the Decision he concluded that a habitual residence test is not the only method of establishing the requisite link between a claimant for JSA and the UK employment market; and that the application of a habitual residence test should be subject to the proviso that if the relevant authority was satisfied on other grounds that the requisite link existed, then there was no legitimate role for any additional test of habitual residence. So, whilst rejecting Mr Drabble’s submission that, in the context of JSA, the habitual residence test should be, in effect, watered down, and concluding that the test should apply “in the ordinary way”, the Commissioner held that the situations in which the test was applicable were limited in the terms of his proviso.

By his grounds of appeal, Mr Collins contends that the Commissioner erred in law in rejecting Mr Drabble’s submissions on question (3). He contends that the only legitimate policy objective of a residence requirement is the need to establish that the claimant is genuinely seeking work; and that it follows that, given the conditions of entitlement to JSA (which include the condition that the claimant is actively seeking employment), there is no legitimate role for an additional test of habitual residence. In the alternative, he contends that if the application of a residence test is not precluded by Community law, in applying such a test factors which do not assist in answering the question whether the search for work is genuine are to be disregarded. In the further alternative he contends that the habitual residence test, when applied in conjunction with the Commissioner’s proviso (see paragraphs 45 and 47 of the Decision), does not provide a prospective claimant with “clear criteria known in advance” (see paragraph 72 of the ECJ’s judgment).

By a Respondent’s Notice the Secretary of State invites us to uphold the Decision on the additional or alternative ground that (as the Commissioner found) Mr Collins did not at the material time meet the habitual residence test: a test which (the Secretary of State contends) is fully compatible with Community law without the need to apply the proviso referred to by the Commissioner in paragraphs 45 and 47 of the Decision.

In this court, Mr Drabble substantially repeats the propositions recorded by the Commissioner in paragraph 21 of his judgment (and later rejected by him), save that propositions (2) and (3) are advanced in reverse order. Fundamental to each of the three propositions, Mr Drabble submits, is the relationship between paragraph 72 of the ECJ’s judgment and a habitual residence test as recognised and applied in English law (see, e.g., Nessa) or in Community law (see, e.g., Swaddling).

Mr Drabble accepts that it is implicit in paragraph 72 of the ECJ’s judgment that to require a short, fixed residence period – albeit that such a requirement would be discriminatory – would be justified in pursuit of the legitimate aim of establishing the genuineness of the claimant’s search for work; but he submits that a habitual residence test is not an appropriate substitute for such a requirement.

Turning to the first of his three propositions (viz. that the sole legitimate question is whether at the material time the claimant was genuinely seeking work in the UK employment market, and that once that is established there is no justifiable role left for a habitual residence test), Mr Drabble submits that given that under UK legislation entitlement to JSA is conditional on (among other things) the claimant actively – i.e. genuinely – seeking employment in the UK employment market, there is no room for any additional test directed at establishing that fact.

As to the second of his propositions (proposition (3) before the Commissioner, viz. that if a habitual residence test is not precluded, it must be applied in a way which disregards factors which do not assist in determining whether the claimant’s search for work was genuine), Mr Drabble submits that the habitual residence test requires the decision-maker to consider a ‘bundle’ of factors and that once the decision-maker has reached the conclusion that the claimant’s search for work is genuine, that conclusion cannot legitimately be displaced by a consideration of other factors within the habitual residence ‘bundle’.

As to the third of his propositions (proposition (2) before the Commissioner, based upon the reference in paragraph 72 of the ECJ’s judgment to the requirement for “clear criteria known in advance”), Mr Drabble accepts that a habitual residence test, without more, does not fall foul of that requirement, but he submits that the application of the Commissioner’s proviso (see paragraphs 45 and 47 of the Decision) would import an unacceptable degree of unpredictability.

For the Secretary of State Mr Christopher Vajda QC submits that, properly interpreted, the ECJ’s judgment recognises that a member state may legitimately require the existence of a ‘genuine link’ between the claimant and its employment market in addition to a requirement that the claimant is genuinely seeking work in that market; and hence that the two requirements are not the same. In support of this submission he referred us to the subsequent judgment of the ECJ in Bidar (cited by the Commissioner in paragraph 26 of the Decision).

In Bidar a French national, who had for more than three years before commencing a university course in the UK lived with his grandmother and attended secondary school in the UK, applied for a loan for maintenance assistance during the course. His application was refused on the ground that at the material time he was not ‘settled’ in the UK within the meaning of the Immigration Act 1971 (a condition which required him, among other things, to have been ordinarily resident in the UK for three years before the beginning of the relevant course). He appealed to the High Court, contending that the relevant rules were discriminatory on the ground of nationality, contrary to articles 12(1), 17 and 18(1) of the EC Treaty. The High Court referred to the ECJ for a preliminary ruling questions directed at whether, notwithstanding the introduction into the EC Treaty of European Union citizenship and the rights attached to such citizenship, maintenance assistance for university students continued to fall outside the prohibition of discrimination on grounds of nationality; and if not, what principles were applicable in determining the question of discrimination. The ECJ ruled, applying Grzelczyk, that since the introduction of European Union citizenship the situation of a student who was a citizen of the Union and lawfully resident in another member state fell within the scope of the anti-discrimination provision in article 12 of the EC Treaty for the purposes of the provision of state assistance to cover maintenance costs.

The second question referred to the ECJ for a preliminary ruling asked what criteria a national court should apply in determining whether the conditions of granting assistance to cover students’ maintenance costs were based on objective considerations independent of nationality. Addressing that question, the ECJ considered first whether the national legislation in question distinguished between students on grounds of nationality. It concluded that the requirements of the regulations in question risked placing nationals of other member states at a disadvantage, in so far as the requirements in question were likely to be more easily satisfied by UK nationals. The ECJ continued as follows (in paragraphs 54 to 59 of its judgment):

“54.

Such a difference in treatment can be justified only if it is based on objective considerations independent of the nationality of the persons concerned and is proportionate to the legitimate aim of the national provisions (see Criminal proceedings against Bickel (Case C-274/96; [1998] ECR I-7637, 7658, para 27, [D’Hoop], para 36, and Garcia Avello v. Belgian State (Case C-148/02; [2003] ECR I-11613,11646, para 31).

55.

According to the United Kingdom Government, it is legitimate for a member state to ensure that the contribution made by parents or students through taxation is or will be sufficient to justify the provision of subsidised loans. It is also legitimate to require a genuine link between the student claiming assistance to cover his maintenance costs and the employment market of the host member state.

56.

On this point, it must be observed that, although the member states must, in the organisation and application of their social assistance systems, show a certain degree of financial solidarity with nationals of other member states (see [Grzelczyk], para 44), it is permissible for a member state to ensure that the grant of assistance to cover the maintenance costs of students from other member states does not become an unreasonable burden which could have consequences for the overall level of assistance which may be granted by that state.

57.

In the case of assistance covering the maintenance costs of students, it is thus legitimate for a member state to grant such assistance only to students who have demonstrated a certain degree of integration into the society of that state.

58.

In this context, a member state cannot, however, require the students concerned to establish a link with its employment market. Since the knowledge acquired by a student in the course of his higher education does not in general assign him to a particular geographical employment market, the situation of a student who applies for assistance to cover his maintenance costs is not comparable to that of an applicant for a tideover allowance granted to young persons seeking their first job or for a jobseeker’s allowance: see, in that regard, D’Hoop, paragraph 38, and Collins v. Secretary of State for Work and Pensions (Case C-138/02); [2005] 1 QB 145, 181, paragraph 67, respectively.

59.

On the other hand, the existence of a certain degree of integration may be regarded as established by a finding that the student in question has resided in the host member state for a certain length of time.”

Mr Vajda relies on the above passage (and particularly paragraphs 58 and 59) as supporting his interpretation of the ECJ’s judgment in this case.

Turning to the first of Mr Drabble’s three propositions, Mr Vajda reiterates that (as the Commissioner concluded) on a correct interpretation of the ECJ’s judgment it is legitimate for a member state to require a ‘genuine link’ with its employment market, in addition to the condition that the claimant must be actively seeking work; and that a habitual residence test is a legitimate way of establishing that link. To illustrate the distinction between an active search for work and the existence of such a ‘genuine link’, Mr Vajda gives the example of a person coming to the UK for the period of the Wimbledon fortnight, intending to find casual work to fund his visit. Such a person’s search for work would be entirely genuine, but there would be no ‘genuine link’ between that person and the UK employment market. He accordingly submits that a habitual residence test is entirely compatible with Community law.

As to Mr Drabble’s second proposition, Mr Vajda submits (as foreshadowed by the Respondent’s Notice) that there is no necessity to subject the application of the habitual residence test to the proviso formulated by the Commissioner in paragraphs 45 and 47 of the Decision. He submits that the habitual residence test, when applied in the ordinary way, is a proportionate means of ensuring the existence of the requisite ‘genuine link’ in any particular case.

As to Mr Drabble’s third proposition, Mr Vajda submits that if (contrary to his earlier submission) it is necessary to apply the proviso formulated by the Commissioner in paragraphs 45 and 47 of his Decision, the resulting test does not offend against the need for “clear criteria known in advance”. He points out that there is a distinction between the clarity of a prescribed test, and the predictability of the outcome of the application of that test in any particular case.

I have no difficulty in agreeing with the Commissioner that the proper interpretation of the ECJ’s judgment, read as a whole, is that a requirement that there should be a “genuine link between an applicant for an allowance in the nature of a social advantage … and the geographic market in question” (see ibid. paragraph 67) is not synonymous with a requirement that the applicant should be actively (i.e. genuinely) seeking work in that market at the material time; and that in the context of an application for such an allowance a ‘genuine link’ requirement may (subject always to questions of justification and proportionality) be legitimately imposed by a member state in addition to an ‘actively seeking work’ requirement. Indeed, notwithstanding the last sentence of paragraph 72 (which I consider below), I find it impossible to read the judgment in any other way.

In the first place, a requirement (in whatever form) of residence in a particular member state as a condition of eligibility for an allowance in the nature of a social advantage which is available in that member state is, to my mind, conceptually at odds with the status of citizen of the European Union and the rights attaching to that status. It follows, as it seems to me, that any consideration of the extent to which such a requirement is compatible with Community law calls for an approach which tends towards restricting the scope of the requirement, rather than widening it. In the particular context of JSA, whilst I can see that there is a logical connection between a requirement of residence in the UK and the establishment of a ‘genuine link’ with the UK employment market, I can see no logical connection between such a requirement and a requirement that an applicant for JSA should be actively seeking work in the UK. In the age of the e-mail and the internet, coupled with the availability of the Channel Tunnel and of low cost air flights, I can see no logical reason why an EU citizen applying for JSA who fulfils a requirement of residence in the UK should be more likely to be actively seeking work in the UK than an EU citizen applying for JSA who does not fulfil that requirement. In every case, it must be a question of fact whether or not the applicant is actively seeking work in the UK – i.e. whether the application is genuine – and I cannot see how the fact that the applicant may have met a requirement of residence in the UK can assist in the resolution of that question. If that be right, the adoption of the approach which I have described above suggests that the concept of a ‘genuine link’ with the local employment market is a free-standing concept, and not merely a step on the way to establishing that an applicant for JSA is actively seeking work in that market.

The ECJ’s reference (in paragraph 67 of its judgment) to paragraph 38 of its judgment in D’Hoop supports such a conclusion. In D’Hoop the claimant was a Belgian national who had completed her secondary education in France. After studying at a Belgian university she applied to the appropriate Belgian authority for a ‘tideover allowance’ – a species of unemployment benefit available to young people seeking their first job. The relevant authority refused the application on the ground that the claimant had not fulfilled the condition that secondary education had to be completed at an educational establishment in Belgium. The claimant challenged that refusal in the Belgian courts, and the court asked the ECJ for a preliminary ruling as to whether Community law precluded a member state from refusing to grant the tideover allowance to one of its own nationals on the sole ground that she had completed her secondary education in another member state. The ECJ ruled that Community law precluded such a refusal, which was contrary to the principles underpinning the status of citizen of the European Union. At the same time, the ECJ acknowledged that it was in principle legitimate for the national legislature to wish to ensure that there was a “real link” between the applicant for that allowance and the geographic employment market in question. Thus, in paragraph 38 of its judgment it said this:

“The tideover allowance provided for by Belgian legislation … aims to facilitate for young people the transition from education to the employment market. In such a context it is legitimate for the national legislature to wish to ensure that there is a real link between the applicant for that allowance and the geographic employment market concerned.”

However, the ECJ went on to rule that the condition in question was too general and exclusive, saying this (in paragraph 39):

“However, a single condition concerning the place where the diploma of completion of secondary education was obtained is too general and exclusive in nature. It unduly favours an element which is not necessarily representative of the real and effective degree of connection between the applicant for the tideover allowance and the geographic employment market, to the exclusion of all other representative elements. It therefore goes beyond what is necessary to attain the objective pursued.”

In context, the reference to the “objective pursued” in the last sentence of the above passage can only be a reference to the objective of ensuring the existence of a “real link” with the employment market in question.

What is significant about D’Hoop for present purposes, as it seems to me, is that there was no issue in that case as to the genuineness of Ms D’Hoop’s application for tideover allowance; nor was it suggested that any of the other conditions of entitlement to tideover allowance had not been met. As I read its judgment, the ECJ treated the requirement for a ‘genuine link’ as a free-standing requirement.

Further support for my reading of the ECJ judgment in the instant case is provided by its judgment in the later case of Bidar, in the passage relied on by Mr Vajda: see in particular the ECJ’s references (in paragraphs 57 and 59) to “a certain degree of integration” of the student with the particular employment market. Of particular significance in this respect, to my mind, is the ECJ’s acknowledgment (in paragraph 59) that the requisite degree of integration:

“… may be regarded as established by a finding that the student in question has resided in the host member state for a certain length of time”.

To my mind, the concept of establishing the requisite degree of integration with the employment market of the host member state by residing in that state for a period of time is a mile away from the question whether the applicant was at the material time actively seeking work in that market. In my judgment, on a proper interpretation of the ECJ’s judgment in the instant case a genuine link with the relevant market is not established merely by making a genuine application.

Returning to the ECJ’s judgment in the instant case, I respectfully agree with the Commissioner that the structure of the crucial passage in the judgment (paragraphs 63 to 72) also strongly supports this conclusion. In the first place, as I pointed out earlier (see paragraph 33 above), the whole of that passage must be read in the context of the Commissioner’s acceptance that Mr Collins was at the material time actively seeking work in the UK: that is to say, that his application for JSA was a genuine application. This is reflected in the reference in paragraph 69 to “a person seeking work” (paragraph 69) and in the reference to a person who has “genuinely sought work” for a reasonable period in the host member state (paragraph 70). Thus, leaving aside paragraph 72 for the moment, in the passage in question the ECJ is assuming the existence of a genuine applicant, and discussing the nature of the link which may be required between such an applicant and the employment market in question.

I come, then, to paragraph 72, the last sentence of which forms the bedrock of Mr Drabble’s submissions.

Paragraph 72 is concerned with the legitimacy of a residence requirement as the means of ensuring a ‘genuine link’ (“for the purpose of ensuring such a connection”). Taking the last sentence of the paragraph in isolation, I accept that it supports Mr Drabble’s first proposition. However, in the context of the earlier paragraphs to which I have referred, I find it impossible to read the reference in that sentence to “genuinely seeking work in the employment market of the host member state” as referring merely to the genuineness of the claimant’s search for work as opposed to the need for a genuine link between the claimant and the employment market of the host member state. In my judgment, to read that sentence as Mr Drabble invites us to read it would make nonsense of the earlier paragraphs in the judgment.

In my judgment, therefore, Mr Drabble’s first proposition is unsustainable and I reject it.

I turn, then, to Mr Drabble’s second proposition, viz. that in applying the habitual residence test in regulation 85(4) factors within the test which are irrelevant to the issue as to whether the search for work is genuine should be ignored.

I confess that I am unable to distinguish his second proposition from his first proposition. If the only question is whether “the search for work is genuine” (in the sense, as I understand it, that the claimant for JSA is, on the relevant day, actively seeking work in the UK employment market) then it is axiomatic (a) that in determining that question irrelevant factors carry no weight and should be ignored; and (b) that to the extent that the habitual residence test imports such factors, it goes beyond what is necessary to determine that question. On that analysis, there is nothing left of the habitual residence test as a free-standing test: it is completely emasculated and emptied of all content.

However, I have already concluded (in respectful agreement with the Commissioner) that on a proper interpretation of the ECJ’s judgment the question whether the search for work is genuine is not the sole question; there is an additional and different question whether a ‘genuine link’ has been established with the UK employment market. Factors which are relevant to the latter may not be relevant to the former. Hence on the basis of the ECJ’s judgment there is, in principle, scope for a residence test which imports factors which may be irrelevant to the question whether the search for work is genuine.

The question then is whether a habitual residence test – as opposed to some other form of residence test (e.g. a requirement of residence for a short, fixed period, which Mr Drabble accepts would not contravene Community law) – is in principle an appropriate form of test for establishing whether or not the requisite ‘genuine link’ exists. On my reading of the ECJ’s judgment, however, it has already answered that question in the affirmative. Thus, after referring (in paragraph 65 of its judgment) to the habitual residence test prescribed by regulation 85(4), the ECJ goes on (in paragraph 66 of its judgment) to say that “a residence requirement of that kind” (my italics) – i.e. of the kind prescribed by regulation 85(4): viz. a habitual residence test – can only to be justifiedin certain circumstances (see also paragraph 54 of the ECJ’s judgment and my comments on that paragraph in paragraph 33 of this judgment).

Moreover, as the Commissioner pointed out (see paragraph 43 of the Decision) a habitual residence test is well-recognised in Community law. The ECJ’s decision in Swaddling (a decision which was cited in its judgment in the instant case) is an example of this. In Swaddling the Social Security Commissioner referred to the ECJ for a preliminary ruling a question which had arisen between Mr Swaddling, a British national, and the adjudication officer in relation to Mr Swaddling’s application for income support. The UK legislative regime governing entitlement to income support was similar to that which now governs entitlement to JSA, including the definition of the expression ‘person from abroad’ (which in turn included the habitual residence test). The adjudicating officer refused Mr Swaddling’s application on the ground that he did not meet the habitual residence test. The appeal tribunal allowed his appeal on the ground that as at the material date he had shown the necessary intention to establish habitual residence in the UK, but it granted the adjudication officer permission to appeal against that decision to the Social Security Commissioner. The Commissioner stayed the proceedings and referred to the ECJ the question whether it was compatible with article 48 of the EC Treaty for a member state to require that an applicant for an allowance in the nature of income support who was once habitually resident in that state, but who had subsequently moved to another member state and become habitually resident there, should, on returning to the first member state, be required to re-establish habitual residence in that member state (involving an appreciable period of residence in that member state). In holding that the answer to that question was in the negative, the ECJ did not at any point in its judgment suggest that a habitual residence test was in any respect incompatible with Community law. Had it been of that view, no doubt it would have said as much in the clearest terms. Instead, it considered the nature of a habitual residence test, concluding (in paragraph 33 of its judgment) that habitual residence in a member state presupposes not only an intention to reside there, but also completion of an appreciable period of residence there.

For completeness, I should also refer to Nessa,as an example of the application of a habitual residence test in national law. In Nessa the appeal tribunal found that the applicant for income support was habitually resident in the UK, in that her “centre of interest” was in the UK and she was present in the UK “for no other purpose than to be habitually resident here”. The Commissioner allowed the adjudication officer’s appeal on the basis that the appeal tribunal had erred in failing to consider whether the applicant had resided in the UK for an appreciable period, and he ordered a rehearing. The Court of Appeal dismissed the applicant’s appeal, holding (as the ECJ held in Swaddling) that in order to meet the requirement of habitual residence an applicant must have been in the UK for an appreciable period of time. The House of Lords upheld the Court of Appeal’s decision. The leading speech in the House of Lords was delivered by Lord Slynn of Hadley, with whom the rest of their Lordships agreed. In the course of his speech, Lord Slynn cited a passage from the speech of Lord Brandon of Oakbrook in Re J [1990] 2 AC 562 at 578-9 in the course of which Lord Brandon observed that “the question whether a person is or is not habitually resident in a specified country is a question of fact to be decided by reference to all the circumstances of any particular case”. Lord Slynn echoed this observation later in his speech (at pp.1942-1943), saying:

“It is a question of fact to be decided on the date [when] the determination has to be made on the circumstances of each case whether and when that habitual residence has been established. Bringing possessions, doing everything necessary to establish residence before coming, having a right of abode, seeking to bring family, ‘durable ties’ with the country of residence or intended residence, and many other factors have to be taken into account.

The requisite period is not a fixed period. It may be longer where there are doubts. It may be short … There may indeed be special cases where the person concerned is not coming here for the first time, but is resuming an habitual residence previously had ….”

Nessa serves to demonstrate the flexibility of the test of habitual residence in national law, a flexibility which (on my reading of its judgment) the ECJ recognised in Swaddling.

As noted earlier, Mr Drabble does not contend that, absent the Commissioner’s proviso, a habitual residence test fails to meet the requirement for “clear criteria known in advance”. Accordingly, subject only to considering the need for, and the appropriateness of, a proviso in the terms formulated by the Commissioner, I conclude that, in the context of JSA, the habitual residence test in regulation 85(4) is not incompatible with Community law.

The effect of the Commissioner’s proviso, as I understand it, is that although the habitual residence test is to be applied in the ordinary way, it cannot be justified as laying down the sole test for establishing the existence of the requisite ‘genuine link’ between an applicant for JSA and the UK market; so that if the decision-maker can be satisfied on other grounds that such a link has been established, then the habitual residence requirement must fall away.

With respect to the Commissioner, I cannot see any basis in Community law for the introduction of such a proviso. Certainly, as I read the ECJ’s judgments in this case and in Swaddling, there is nothing in those judgments which suggests the need for such a proviso. In my judgment the correct analysis is that under Community law it is a matter for the national legislature whether to require the existence of a ‘genuine link’ and (if so) to prescribe how that link may be established; and that the prescription of a habitual residence test for that purpose is both legitimate and justified. Had the ECJ taken a contrary view, I would have expected it to say so: the more so because, as I have already pointed out (see paragraph 81 above), the discussion which follows paragraph 66 of its judgment is clearly directed specifically at the habitual residence requirement prescribed by regulation 85(4), rather at the general concept of a residence requirement.

Accordingly I respectfully conclude that the Commissioner was in error in concluding that in order to render the habitual residence requirement compatible with Community law it was necessary to introduce the proviso in question; and that on the proper interpretation of the ECJ’s judgment in this case a habitual residence test simpliciter as a means of establishing the requisite ‘genuine link’ between an applicant for JSA and the UK employment market is fully compatible with Community law.

It follows from that conclusion that I need not consider the difficult question whether a habitual residence requirement coupled with such a proviso meets the need for “clear criteria known in advance”.

I would dismiss this appeal.

I agree.

I also agree.