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When benefit tourism enters the Court-room – The consequences of the Dano-case

By Associate Professor, PhD. Catherine Jacqueson and PhD-scholar Katarina Hylten-Cavallius, Welma Center for Legal Studies in Welfare and Market, Law Faculty, Copenhagen University, Denmark.

The Dano-ruling was much awaited and its outcome stirred headlines across the EU Member States. The UK Prime Minister Cameron called the ruling ‘common sense’ as the European Court of Justice set limits to a Union citizen’s right to equal treatment when claiming social assistance from a host Member State, thereby tackling the issue of ‘benefit tourism’.

The questions referred concerned a request for a subsistence allowance. German authorities had refused to grant it to the Romanian national Mrs. Dano on the ground that Union citizens, who do not fulfil the conditions for lawful residence in the Directive, do not benefit from the right to equal treatment.

A noteworthy aspect of the ruling is the Court’s strict and exclusive emphasis on the lawfulness of the residence. Lawful residence could only stem from EU law and the conditions of the Citizenship Directive had to be fulfilled. The Court did not try to ‘save’ Mrs Dano by virtue of her EU citizenship. Indeed, it did not give any consideration to the fact that Mrs. Dano had been granted a residence permit of unlimited duration by the German authorities before claiming the benefits in question or the fact that her sister had previously provided for her needs. This is a deviation from previous case law such as C-85/96 Sala and C-456/02 Trojani where the Court found that lawful residence according to national law was enough for a Union citizen to rely on the right to equal treatment in Article 18 TFEU. In addition, the new approach in the Dano-case raises at least two concerns. First, Union citizens who are not entitled to any benefits do not seem to be expellable as they do not constitute an unreasonable burden on the public purse. A person in Mrs Dano’s situation might therefore lawfully remain in a host Member State but be denied equal access to some (or all) social rights that the host society’s nationals have. This legal limbo can potentially constitute a social bomb. Second, how will the Dano-ruling affect the legal protection of first-time jobseekers? The Court does indeed qualify the benefit sought as a social advantage and thereby implicitly removes it from the scope of EU-law for first-time jobseekers. Yet, this allowance could also be classified as one facilitating access to the labour market for those available for work pursuant to the Vatsouras-ruling. The Court’s ruling in the forthcoming case C-67/14 Alimanovic is therefore much awaited. The saga continues for better and for worse…