CASE OF TARKOEV AND OTHERS v. ESTONIA
No violation of Art. 14+P1-1;Remainder inadmissible
Ganna Yudkivska;Isabelle Berro-Lefèvre;Mirjana Lazarova Trajkovska;Peer Lorenzen;Rait Maruste;Renate Jaeger;Zdravka Kalaydjieva
7. The applicants, forty-five Russian military pensioners whose names along with other relevant information are listed below (Annex), live in Estonia. 8. On 26 July 1994, at the same time as the conclusion of a treaty on the withdrawal of Russian troops from Estonian territory, Estonia and the Russian Federation signed an agreement concerning the provision of social security guarantees to the retired military personnel of the armed forces of the Russian Federation on the territory of Estonia (“the Agreement”). The Agreement provided that retired military personnel, that is − persons discharged from army service and receiving pensions, could apply for residence permits in Estonia. The Russian Federation undertook the securing of the payment of pensions to the persons concerned according to Russian legislation. Furthermore, it was stipulated that the retired military personnel could also apply for an Estonian pension, in which case the payment of their Russian pension would be suspended while they were receiving an Estonian pension, and vice versa. 9. Until 1998 the Russian military pension was, in most cases, considerably higher than the Estonian old-age pension. Then, after the change in the economic situation and amendment of the pension law, the Russian military retirees faced the situation where they could choose to receive either a Russian military pension (smaller than the average old-age pension in Estonia) or an Estonian old-age pension for fewer years of service. In the latter case, only the years of pensionable employment in the civil sphere – and not the years of service in the Russian (Soviet) armed forces – were taken into account. According to the applicants, in both cases the sums were rather small and not enough for survival in Estonia. 10. From January 2006 many military retirees, including the applicants, who had worked in Estonia in the civil sphere and fulfilled the requirements (in particular, at least fifteen years of pensionable employment in Estonia) for receiving an Estonian old-age pension, applied for and were granted, such a pension for life. However, a few months later, after a regular exchange of information between the Estonian social insurance authorities and the Russian Embassy, the Estonian authorities realised that the Russian Embassy was continuing to pay the persons concerned Russian military pensions. The Estonian authorities then suspended the payment of the Estonian pension to the persons concerned and requested that they provide confirmation of the suspension of payment of the Russian military pension if they wished that the payment of the Estonian pension be resumed. 11. According to the Government, who referred to information published in the Russian-speaking press, the average military pension paid by the Russian Federation in 2008 was, depending on the person's military rank, 7,400, 5,800 or 5,000 kroons (EEK) a month (corresponding to approximately 473, 371 or 320 euros (EUR), respectively). At the same time, the average old-age pension in Estonia was EEK 4,356 (EUR 278). Although the pensions paid by Estonia had increased since 1994, the Russian military pension was higher than the average Estonian old-age pension and definitely higher than the minimum pension established in Estonia (EEK 2,008.80 (EUR 128) in 2009) which they had been guaranteed under Article 3 of the Agreement. According to the applicants, who relied on the information from the Russian Embassy in Tallinn, the average pension of a Russian military pensioner in Estonia in 2008 was EEK 3,817 (EUR 244) − which was much less than the average Estonian pension at the same time. 12. The applicants challenged the decisions of the Estonian social security authorities to suspend the payment of the Estonian old-age pension (in the case of Mr V. Gladõšev – invalidity pension). Arguing that they had been discriminated against and that their property rights had been violated, they lodged complaints with the competent administrative courts against the individual decisions of the Estonian social security authorities. They requested that the courts order the social security authorities to resume payment of the pension. Their complaints were dismissed in separate administrative court proceedings by the administrative courts and courts of appeal. In the case of all of the applicants, with the exception of Mr V. Gladõšev, the Supreme Court dismissed the appeals as manifestly illfounded. Mr V. Gladõšev's appeal was refused by the Supreme Court because of his failure to pay the court fee of EEK 400 (EUR 26). The Supreme Court examined his request for exemption and rejected it by a reasoned decision. 13. The reasoning underlying the individual decisions of the social security authorities as well as the complaints and judgments in respect of each of the applicants were similar and can be summarised as follows. 14. The courts found that the clear and unequivocal wording of Article 5 of the Agreement provided that only one of the States (not both States simultaneously), should pay a pension to the military retirees. Simultaneous payment of the Russian military pension and the Estonian old-age pension was excluded because the State Pension Insurance Act (Riikliku pensionikindlustuse seadus) provided that if an international agreement entered into by the Republic of Estonia contained provisions which differed from the provisions of this Act for the grant or payment of pensions, the international agreement applied (section 4(3)). By way of comparison, the courts noted that the State Pension Insurance Act generally provided that persons who had the right to receive several state pensions were granted one state pension of their choice. The same applied to members of the Estonian Defence Forces even if they qualified for an old-age pension and defence forces pension simultaneously (section 196(5) of the Defence Forces Service Act (Kaitseväeteenistuse seadus)). 15. The courts did not exclude the possibility that there were people living in Estonia who were receiving military pensions from a foreign country and, at the same time, a state pension from Estonia. Nevertheless, they found that the Russian military retirees had not been discriminated against, as their situation was not comparable to that of persons who had served in the armies of States which were members of the same international organisations as Estonia, such as NATO or the European Union. The courts pointed out that the relationship of Estonia with those countries had been established on a different basis. 16. The courts dismissed the argument concerning an alleged violation of the applicants' legitimate expectation, noting that they could have no legitimate expectation of receiving two pensions simultaneously, as the Agreement provided that a person could not receive two pensions at the same time. 17. The courts also rejected the applicants' allegation that their property rights had been violated, finding that, as they were continuing to receive their Russian military pension, the applicants did not meet the conditions required for receiving the Estonian pension and that therefore they had no property rights within the meaning of Article 32 of the Estonian Constitution or Article 1 of Protocol No. 1 to the Convention. The courts emphasised in this context that the applicants had the right to opt for an Estonian pension instead of the Russian one at any moment they wished. 18. The courts found that the essence of the applicants' pension rights had not been undermined, as they had been guaranteed an income sufficient for subsistence. They noted that, according to Article 3 of the Agreement, the applicants received a pension at least equal in value to the amount of the minimum pension in Estonia. 19. Finally, the courts noted that the States which were parties to the Agreement could amend the Agreement so that each of them undertook to pay pensions according to the pensionable years of work in the respective country. However, this was a matter of political will; the actual Agreement did not foresee such a possibility and there were no grounds for not applying the Agreement. 20. The State Pension Insurance Act (Riikliku pensionikindlustuse seadus), as in force at the material time, provided: “(1) Under the conditions provided for in this Act, state pensions shall be granted and paid to: 1) permanent residents of Estonia; 2) aliens residing in Estonia on the basis of temporary residence permits or a temporary right of residence. ... (2) A state pension shall be granted pursuant to this Act unless a person receives a state pension pursuant to other Estonian Acts. (3) If an international agreement entered into by the Republic of Estonia contains provisions which differ from the provisions of this Act for the grant or payment of pensions, the international agreement applies.” “Persons who have the right to receive several state pensions shall be granted one state pension of their choice ...” “(1) The following persons have the right to receive an old-age pension: 1) persons who have reached sixty-three years of age and 2) whose pension-qualifying period as provided for in section 27 of this Act and spent in Estonia is fifteen years. ...” “(1) An old-age pension consists of three components: 1) the basic amount (baasosa); 2) a component calculated on the basis of years of pensionable service (staažiosak), the amount of which equals the number of years of pensionable service (pensioniõiguslik staaž) (section 28) multiplied by the financial value of a year of pensionable service; 3) an insurance component (kindlustusosak), the amount of which equals the sum of the annual factors of an insured person (section 12) multiplied by the financial value of a year of pensionable service. ...” “(1) A pension-qualifying period (pensionistaaž) is a period during which an insured person is engaged in an activity which merits the right to receive a state pension. (2) A pension qualifying period shall be divided as follows: 1) the years of pensionable service (pensioniõiguslik staaž), which is calculated up to 31 December 1998; 2) the accumulation period (pensionikindlustusstaaž), which is calculated from 1 January 1999. ...” “(1) Time during which the employer of a person is required to pay social tax for the person shall be included in the years of pensionable service (pensioniõiguslik staaž) of the person. ...” 21. The relevant provisions of the Agreement concerning social guarantees to retired military personnel of the armed forces of the Russian Federation on the territory of Estonia, agreed between Estonia and the Russian Federation on 26 July 1994, provide as follows: “The Russian Federation shall secure pensions for military retirees on the territory of the Republic of Estonia regardless of their nationality, on the conditions and according to the norms established by the legislation of the Russian Federation. The pension shall be paid at least in the amount of the minimum pension in the Republic of Estonia, including compensation. ...” “The authorities of the Republic of Estonia may establish and pay at the cost of the Republic of Estonia pensions to military retirees who have a right to a pension under the laws of the Republic of Estonia, subject to the wishes of those military retirees. In this case the payment of the pension that had earlier been established by the Russian Federation shall be suspended for the period of payment of pensions by the authorities of the Republic of Estonia, and vice versa.” 22. A cooperation agreement on exchange of information on the enforcement of Article 5 of the Agreement was signed by the Estonian Social Insurance Board (Sotsiaalkindlustusamet) and the Social Department of the Embassy of the Russian Federation in Estonia on 7 July 2004. A new agreement concerning the same matter was signed on 20 February 2007. 23. In the meantime, on 25 June 1993, Estonia and the Russian Federation signed a general pension agreement which was amended by a protocol signed on 5 November 2002. That agreement and its protocol entered into force on 16 October 2007. These instruments provide that, as a rule, a person receives pension from his or her country of residence on the basis of that country's legislation. Military pensioners, subject to the Agreement, do not fall under the general pension agreement. 24. The Government informed the Court that Estonia and the Russian Federation were holding negotiations to sign a new general pension agreement instead of the current one which was due to expire in 2011. According to its draft, each country would pay pension for the years of pensionable employment accumulated on its territory. That principle would also apply to the military pensioners instead of Article 5 of the Agreement. 25. In a judgment of 28 April 2008 (case no. 3-3-1-1-08) the Administrative Law Chamber of the Supreme Court dealt with a case similar to that of the applicants. The Supreme Court quashed the lower court's judgment on procedural grounds and therefore did not rule on the merits of the case. Nevertheless, it pronounced its opinion on some aspects of the matter. The Supreme Court considered that the so-called military pension paid under the Agreement was not a state pension and that therefore section 6 of the State Pension Insurance Act was not applicable. It pointed out that pursuant to section 4(3) of the Act, if an international agreement signed by Estonia contained provisions which differed from the provisions of that Act, the international agreement took precedence. The Supreme Court found that pursuant to Article 5 of the Agreement it was not possible to simultaneously pay a pension for service in the Soviet armed forces and for a subsequent period of employment in Estonia. According to the Estonian Ministry of Foreign Affairs which was invited to participate in the proceedings, this had been the understanding of the parties to the Agreement since its signing. However, the parties were aware of the problem and since 2002 the Russian party had taken the initiative to resolve it. The Estonian Ministry of Foreign Affairs admitted that both the general approach and the factual circumstances had changed since the signing of the Agreement. In drawing up recent pension agreements the principle of adding up different (not overlapping) periods was also applied; this approach was used in the European Union as well. It was also noted that the Estonian and Russian parties were preparing a new pension agreement presumably also to address the issue of the military pensioners. The Supreme Court referred the case to the Tallinn Court of Appeal which, in a judgment of 4 September 2008 (case no. 3-06-2305), dismissed the appeal. It held: “18. ... In the Court of Appeal's opinion, Article 5 § 2 of the Agreement is justified, on the one hand, by the State's obligation and need to economically use of the state budget. On the other hand, in assessing Article 5 § 2 of the Agreement, the context of the conclusion of the Agreement has to be taken into account, in particular [its] relation to the [treaty on the withdrawal of Russian troops from the Estonian territory] that was concluded at the same time. The purpose of these “July agreements” was the withdrawal from Estonia of the armed forces of the country that had occupied Estonia. As a compromise between the countries, military pensioners who did not pose a threat to Estonian national security were granted the right to stay in Estonia. In return, the Russian Federation assumed an obligation to secure for the military pensioners staying in Estonia under the Agreement, a pension from the Russian Federation that would ensure their subsistence. When entering into the Agreement, Estonia had the right to avoid taking excessive risks with its state budget in connection with the remaining of the military pensioners in Estonia. As the complainant is and was an Estonian national, his right to stay in Estonia was guaranteed regardless of the Agreement; however, [his] nationality alone does not provide him with any wider social guarantees as compared to other military pensioners of the [Soviet Union]. The Russian Federation undertook to provide a pension to the complainant as well, regardless of his nationality (Article 3 of the Agreement). 19. The complainant as a subject falling under the Agreement signed with the Russian Federation is not in the same position as the military pensioners who have served in the armies of those countries which belong to the same international organisations as Estonia such as NATO or the European Union. ... 22. On the basis of the above, the Court of Appeal considers that Article 5 § 2 of the Agreement was in conformity with the Constitution at the time of its signing and ratification. 23. Article 5 § 2 of the Agreement, in order to be applicable in the present case, also had to conform with the Constitution at the time when the disputed administrative decision was taken. A provision of an international agreement can become unconstitutional after its ratification when the provision depriving a person of a right has in the meantime become unreasonable because of changed circumstances, and a reasonable time for amending the agreement or resolution of the matter at the domestic level has elapsed. 24. The Ministry of Foreign Affairs has acknowledged that the conceptual bases of the international pension agreements had changed in the meantime. In the opinion of the Court of Appeal this gives no ground to argue that Article 5 § 2 of the Agreement has already by now become unconstitutional. The conceptual bases of international pension agreements do not amount to constitutional principles. The development of international social insurance law is a long-term process wherein Estonia also needs to be given considerable time to find the best legal and political solutions. The material referred to in the Supreme Court's judgment in the present case confirms that the parties to the Agreement are engaged with the question concerning the pensions of the military pensioners of the former [Soviet Union]. 25. Nor can the Court of Appeal see that Article 5 § 2 of the Agreement has violated or currently violates any international obligations.” On 5 November 2008 the Supreme Court declined to hear an appeal against the Court of Appeal's judgment. 26. In a judgment of 13 June 2008 (case no. 3-3-1-31-08) the Administrative Law Chamber of the Supreme Court dealt with a case where the main issue was whether the complainant in that case was covered by the provisions of the Agreement. It was also required to interpret Article 5 of the Agreement. Referring to its judgment of 28 April 2008 (see paragraph 25 above), the Supreme Court reaffirmed that, based on the grammatical interpretation of Article 5 and, above all, the common will and understanding of the parties to the Agreement in respect of the interpretation and application of this provision, its current wording and the will of the parties only provided for the possibility of receiving a pension granted by one of the countries at a time.