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Protocol to the Convention on Social Security between Canada and Luxembourg [1994] CATSer 4 (1 January 1994)

E102205 - CTS 1994 No. 8

PROTOCOL TO THE CONVENTION ON SOCIAL SECURITY BETWEEN CANADA AND LUXEMBOURG

Canada and the Grand Duchy of Luxembourg,

Desiring to adapt the Convention to changes introduced in the national legislation of both countries,

Have decided to amend the Convention and Protocol on Social Security signed at Ottawa on May 22, 1986, and

Have designated, to that effect, as their plenipotentiaries:

for Canada,

the Minister of National Health and Welfare,

and

for the Grand Duchy of Luxembourg,

the Ambassador Extraordinary and Plenipotentiary of the Grand Duchy of Luxembourg to Canada,

Who, after exchanging their full powers, found in good and due form,

Have agreed as follows:

ARTICLE 1

The Convention on Social Security between Canada and Luxembourg signed at Ottawa on May 22, 1986 shall be amended as follows:

(A) The following paragraph shall replace paragraph 1 (b) of Article II:

"(b) with respect to Luxembourg:

to the legislation concerning pension insurance in the case of old age, disability or survivors."

(B) The following article shall replace Article III:

"ARTICLE III

Unless otherwise provided in this Convention, it shall apply to persons who are or who have been subject to the legislation of one or both Parties as well as those who derive their rights from these persons."

(C) Paragraph 7 of Article VI is deleted.

(D) The following text shall replace Part III:

"PART III

PROVISIONS CONCERNING BENEFITS

CHAPTER 1

TOTALIZING OF PERIODS

ARTICLE VIII

1. If a person is not entitled to the payment of a benefit because he or she has not accumulated sufficient periods of insurance under the legislation of a Party, entitlement to the payment of that benefit shall be determined by totalizing these periods and those specified in paragraphs 2 and 3 of this Article, provided that these periods do not overlap.

2. (a) For purposes of determining entitlement to a benefit under the Old Age Security Act of Canada, a period of insurance under the legislation of Luxembourg or a period of residence in Luxembourg, after the age at which periods of residence in Canada are creditable for purposes of that Act, shall be considered as a period of residence in Canada.

(b) For purposes of determining entitlement to a benefit under the Canada Pension Plan, a calendar year including at least 67.5 days or three months of insurance under the legislation of Luxembourg shall be considered as a year for which contributions have been made under the Canada Pension Plan.

3. (a) For purposes of determining entitlement to an old age pension under the legislation of Luxembourg, periods creditable under the Old Age Security Act of Canada, expressed in months, which were completed before January 1, 1966 and periods creditable under the Canada Pension Plan, expressed in years, as well as periods creditable under the Old Age Security Act of Canada, expressed in months, which are not part of periods creditable under the Canada Pension Plan and which have been completed after December 31, 1965 shall be considered as periods validly covered by contributions under the legislation of Luxembourg.

(b) For purposes of determining entitlement to an anticipatory old age pension between the age of 57 and 60 years or a disability or survivor’s pension under the legislation of Luxembourg, creditable periods under the Old Age Security Act of Canada, expressed in months, which were completed before January 1, 1966, and creditable periods under the Canada Pension Plan, expressed in years and completed after December 31, 1965 shall be considered as periods validly covered by contributions under the legislation of Luxembourg.

For the computation of periods of insurance under the aforementioned legislation of Canada, one year shall correspond to 12 months under the legislation of Luxembourg.

4. The periods which, under the legislation of Luxembourg, result in the extension of the reference period during which the period required for entitlement to disability and survivor’s pensions must be completed, shall also be taken into account if these periods are completed in the territory of Canada.

5. Paragraph 3(b) shall apply by analogy for the purpose of crediting, in accordance with the legislation of Luxembourg, the period of insurance following the birth of a child on behalf of the insured person responsible for the child’s education. The application of the preceding provision is conditional upon the insured person having last completed periods of insurance under the legislation of Luxembourg.

ARTICLE IX

If, after totalizing insurance periods as provided in Article VIII of this Convention, a person is not entitled to a benefit because he or she has not accumulated sufficient periods of insurance under the legislation of both Parties, entitlement to that benefit shall be determined by totalizing these periods and the periods of insurance under the legislation of a third State with which both Parties are bound by an international social security instrument which provides for totalizing of periods of insurance.

ARTICLE IX bis

1. If the total length of the periods of insurance completed under the legislation of a Party is less than one year, the competent institution of that Party shall not be obliged to award a benefit in respect of those periods, unless, on the basis solely of these periods, the person is entitled to a benefit under the legislation being applied by that institution.

2. If, under the legislation of Luxembourg, a person is not entitled to a pension, the contributions credited to the insured person shall be reimbursed to him or her at the end of his or her sixty-fifth year in conformity with this legislation.

CHAPTER 2

BENEFITS UNDER THE LEGISLATION OF CANADA

ARTICLE X

1. If a person is entitled to the payment of a pension or a spouse’s allowance under the Old Age Security Act, solely through the application of the totalizing provisions described in Chapter 1 of this Part, the competent institution of Canada shall determine the amount of the pension or spouse’s allowance payable in conformity with the provisions of that Act governing the payment of a partial pension or spouse’s allowance, exclusively on the basis of the periods of residence in Canada creditable under that Act.

2. The provisions of the first paragraph shall also apply to a person who is entitled to the payment of a pension in Canada but who has not resided in Canada for the minimum period of residence required by the Old Age Security Act for payment of a pension outside Canada.

3. Notwithstanding any other provision of this Convention,

(a) the competent institution of Canada shall not be liable to pay an Old Age Security pension outside Canada unless the periods of residence, when totalized in conformity with the provisions of Chapter 1 of this Part, are at least equal to the minimum period of residence in Canada required by the Old Age Security Act for entitlement to the payment of a pension outside Canada, and

(b) the spouse’s allowance and the guaranteed income supplement shall be paid outside Canada only to the extent permitted by the Old Age Security Act.

ARTICLE XI

If a person is entitled to the payment of a benefit under the Canada Pension Plan, solely through the application of the totalizing provisions of Chapter 1 of this Part, the competent institution of Canada shall determine the amount of the benefit in the following manner:

(a) the earnings-related portion of the benefit shall be calculated in conformity with the provisions of the Canada Pension Plan, exclusively on the basis of the pensionable earnings credited under that Plan; and

(b) the amount of the flat-rate portion of the benefit shall be determined by multiplying:

(i) the amount of the fiat-rate portion of the benefit determined in conformity with the provisions of the Canada Pension Plan

by

(ii) the fraction which represents the ratio of the periods of contributions to the Canada Pension Plan in relation to the minimum qualifying period required under that Plan to establish entitlement to that benefit, but in no case shall that fraction exceed the value of one.

CHAPTER 3

BENEFITS UNDER THE LEGISLATION OF LUXEMBOURG

ARTICLE XII

1. If a person is entitled to a pension under the legislation of Luxembourg without recourse to Article VIII, the institution of Luxembourg shall calculate, in accordance with the provisions of that legislation, the pension corresponding to the total length of the periods of insurance to be taken into account under that legislation.

The institution shall also calculate the pension which would be payable by applying the provisions of paragraph 2 below.

Only the highest amount shall be taken into consideration.

2. If a person is entitled to a pension under the legislation of Luxembourg, but solely through totalizing the periods as provided in Article VIII, the following rules shall apply:

(a) the institution of Luxembourg shall calculate the theoretical amount of the pension to which the applicant would be entitled if all the periods completed in accordance with the legislation of both Parties, when totalized in conformity with paragraph 3 of Article VIII, had been completed exclusively under its own legislation;

(b) on the basis of this theoretical amount, the institution of Luxembourg shall then determine the actual amount of the pension prorated according to the length of the periods of insurance completed under the legislation being applied in relation to the length of the periods completed under the legislation of both Parties, when totalized in conformity with paragraph 3 of Article VIII;

(c) to determine the theoretical amount referred to in paragraph (a) above, the institution of Luxembourg shall credit for the periods completed under the legislation of the other Party:

(i) with respect to calculating proportional increases and special proportional increases, the average of the contributory salaries, wages and earnings recorded for the periods of insurance completed under the legislation being applied and,

(ii) with respect to calculating fixed increases and special fixed increases, a fixed amount equal to that which would be payable if these periods had been completed under the legislation being applied by the institution.

3. If a person is entitled to a pension under the legislation of Luxembourg solely through the provisions of Article IX, the periods of insurance completed under the legislation of a third State shall be taken into account when applying paragraph 2 above."

(E) The following text shall be added to Article XXI:

"4. The periods of insurance completed under the legislation of Luxembourg before January 1, 1988 by persons who did not during those same periods reside in Luxembourg, shall be considered as periods of residence for entitlement to transitional fixed increases."

(F) The following text shall replace paragraph II of the 1986 Protocol:

"Paragraph II

1. The provisions of the legislation of Luxembourg which provide for the reduction, suspension or cancellation of a pension when it coincides with other social security benefits or with professional income or the exercise of a professional activity shall be applied to a beneficiary even if the benefit is acquired under the legislation of Canada or the professional income is earned or the professional activity is performed in the territory of Canada.

2. For the purposes of applying the preceding paragraph, benefits provided for under the legislation of Canada that are subject to an income test shall not be taken into account."

(G) Paragraph III of the 1986 Protocol is deleted.

Article 2

(A) Each of the Parties shall notify the other when the internal procedures required for the entry into force of this Protocol have been completed.

(B) The Protocol shall enter into force on the first day of the third month following the completion of the notification procedure described in paragraph (A).

IN WITNESS WHEREOF, the undersigned, duly authorized thereto by their respective Governments, have signed this Protocol.

DONE in duplicate at Ottawa, this 6th day of February 1992, in the English and French languages, each version being equally authentic.

FOR THE GOVERNMENT OF CANADA

Benoit Bouchard

FOR THE GOVERNMENT OF THE GRAND DUCHY OF LUXEMBOURG

Alphonse Berns