Germany must not discriminate against EU citizens who have moved to Germany when it comes to granting child benefits in the first three months compared to nationals.

The blocking clause in German law, which excludes EU foreigners from receiving child benefit in the first three months if they have no domestic income, is not covered by EU law.

This was determined by the European Court of Justice (ECJ) in a judgment published on Monday in the case of a Bulgarian family.

Katja Gelinsky

Business correspondent in Berlin

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For Germans who return from another Member State and have no income, the three-month exclusion clause for child benefit does not apply.

As the ECJ explains, this different treatment does not conform to EU law.

The case is different if the Member States make differences in social assistance benefits.

But that doesn't include child support.

Under the previous black-red government, a package of laws against illegal employment and abuse of social benefits was passed in 2019.

In it, the receipt of child benefit for non-working EU foreigners was blocked for the first three months.

"Because it cannot be ruled out that the child benefit will have an unintended incentive effect for immigration from other member states," the statement said.

A temporary stay in Germany is not sufficient

The ECJ ruled on the case of a Bulgarian mother of three children.

The woman had applied for child benefit from the Lower Saxony-Bremen Family Benefits Office in 2019.

The application was rejected for the first three months because the mother did not receive any domestic income during this time.

The woman went before the Bremen Finance Court, which turned to the ECJ to clarify whether the refusal to pay child benefit constituted prohibited discrimination.

The ECJ first stated that EU citizens may stay in another member state for up to three months, although they only need to be in possession of a valid identity card or passport.

In addition, they should not make unreasonable demands on the social assistance benefits of the host Member State.

If these requirements were met, the EU foreigners should be treated like nationals.

However, EU law contains one exception: Member States are permitted to refuse social assistance benefits to economically inactive EU foreigners, particularly during the first three months of their stay.

However, according to the ECJ, Germany could not invoke this exception.

Child benefit is not a social benefit, but a family benefit.

The judgment states: "Child benefit is granted regardless of the personal needs of its recipient and is not intended to ensure their livelihood." Rather, it serves to balance family burdens.

The federal government had argued that child benefit should be equated with social assistance benefits because it has the same effect on people without an income from work.

Therefore, the exemption must also apply here.

There is nothing to suggest that Member States should be allowed "to derogate from the principle of equal treatment in relation to benefits other than social assistance benefits".

However, the judges also emphasize that only EU foreigners who have actually established their habitual residence in the host Member State can claim equal treatment.

"A temporary stay is not enough." The Bremen Finance Court must now decide the specific case.