European social security legislation

Regulation (EU) 883/2004

New Delhi, 19 February 2010

Clear solutions by sharp minds

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One system :

• Determination of one single applicable social security legislation in

case of international employment in Europe

– Binding consequences

• Harmonisation of key principles concerning contributions and

benefits

• answer to two questions:

– “In which system must I contribute?”

– “Which state will have to pay benefits?”

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Context

• Regulation 1408/71 and implementing Regulation 574/72– EEA nationals

• Regulation 859/2003: extension to nationals of third countries, e.g.India

☟• Regulation 883/2004

– Dated 29 April 2004

– Replaces Regulation 1408/71

– Only applies as of the date of the implementing regulation

&

• Regulation 987/2009 – In force since 1 May 2010

– Purpose: • Simplification

• Update

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Scope

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Personal scope of application (1)R° 1408/71 R° 883/2004

• Employees (+ civil servants),

self-employed and students

• Subject (or has been subject)

to the legislation of one or

more EU Member States

• Nationality of EU-Member

State, EEA or Switzerland

– Stateless persons and

refugees

– Family members

• Subject (or has been subject)

to the legislation of one or

more EU Member States

• Nationals of a Member State,

stateless persons and

refugees who reside in a

Member State &

– Family members

– Relatives

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Personal scope of application (2)

R° 1408/71 R° 883/2004

• Agreements with Switzerland

only concluded with original 15

Member States

• Since 1 June 2003: extension of

the rules to nationals of third

countries (e.g. India)

(Not for: Denmark, Liechtenstein,

Iceland, Norway & Switzerland)

• R° 883/04 not applicable to

Switzerland, Norway, Iceland

and Liechtenstein

R° 1408/71 applies

• Third country residents not

regulated

R° 1408/71 continues to

apply

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Material scope of applicationR° 1408/71 R° 883/2004

• All branches of social security:

– Sickness and maternity

– Invalidity

– Old age benefits

– Survivors’ benefits

– Industrial accidents and

occupational diseases

– Death grants

– Unemployment benefits

– Family benefits

• Exception: annual vacation,

extra-legal pensions, social assistance

• All branches of social security:

– Sickness and maternity +

– Fatherhood allowance

– Invalidity

– Old age benefits

– Allowances forrelatives

– Industrial accidents and

occupational diseases

– Death grants

– Unemployment benefits

– Family allowances

– Early exit benefits

• Same exceptions

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Rules of determination of one legislation

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General principle: State of employment

Living in

Working in

SS =

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Basic rules

Article 13 R° 1408/71 Article 11 R° 883/2004

• 1 legislation

• State of work principle (De

Jaeck)

– For employees and self-

employed persons

• Coordination ≠ harmonisation

• Appointment of legislation ≠

right to benefits

• 1 legislation

• State of work principle

– For employees and self-

employed persons

– Persons enjoying benefits

• Coordination ≠ harmonisation

• Appointment of legislation ≠

right to benefits

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Exception to the rule: Posting (1)

Article 14, 14bis & 14 ter

R° 1408/71

Article 12 R° 883/2004

• Different rules

– Employees

– Self-employed persons

– Sailors

• 12 months x 2

• No immediate posting

• Rules

– Employees

– Self-employed persons

• 24 months

• Immediate posting

subject for 1 month

2 months for non-

employed persons

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Exception to the rule: Posting (2)

Article, 14bis & 14 ter

R° 1408/71

Article 12 R° 883/2004

Article § 1 and 2 R°987/2009

• Conditions for Employees:

– For the account of Employer

– Must not replace another

person whose detachment is

terminated

– Company to which one is

normally linked

• Conditions for Employees:

– For the account of Employer

– Must not replace another

person

– Substantial activities (≠

purely internal management)

• Conditions for self-employed:

– Work activities prior to posting

& necessary conditions must

continue to be fulfilled

– Duties of the same kind

(factual kind)

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Simultaneous employment of salaried personnel

Article, R° 1408/71 Article R° 883/2004

Article 14 paragraph 5 and 8

R° 987/2009

• State of residence if:

– part of their duties

or

– ≠ employers with registered

office in ≠ Member States

•State of headquarters if:

– no services in state of

residence for employer

• State of residence if:

– “substantial duties”

• 25% of the time or remuneration

– works for ≠ enterprises with

headquarters in ≠ Member States

– works in ≠ Member States for

employer from outside the EU +

no substantial duties in state of

residence

• State of headquarters if :

– only 1 employer !

– “where he is mainly employed”

only in the Dutch text

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Residence

• Article 1 h R° 1408/71: Residence = normal place of residence

• Article 1 paragraph 1 R° 883/04: Residence = “place where a

person habitually resides”

• Article 11 R° 987/09 = if no consensus the centre of interest is

established through information & facts:

– Duration and continuity of presence on territory

– Personal situation

• Nature of work

• Family situation

• Non remunerated activities

• For students: source of income

• Accommodation situation (permanent character)

• Where deemed to live for tax purposes

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Simultaneous work as self-employed

Article 14bis § 2, R° 1408/71 Article 13 R° 883/2004

Article 14 paragraph 5 and 8

R°987/2009

• State of residence:

– works part time there

• Place of main activity if:

– no part of the activities is carried

out in the state of residence

• State of residence:

– “substantial work activities”

• 25% turnover, time, number of

services

• Centre of interests of work

activities if there is no substance

in state of residence

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Centre of interests

• “For the purposes of the application of Article 13(2)(b) of the

basic Regulation, the „centre of interest‟ of the activities of a self-

employed person shall be determined by taking account of all

the aspects of that person‟s occupational activities, notably the

place where the person‟s fixed and permanent place of business

is located, the habitual nature or the duration of the activities

pursued, the number of services rendered, and the intention of

the person concerned as revealed by all the circumstances.”

(Article 14, 9 R°987/2009)

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Simultaneous work activities as employees + self-

employed

Article 14quater, R° 1408/71 Article 13 § 3 R° 883/2004

• (a) Member State where

activity is carried out in a

salaried capacity

• (b) If Annex VII :

Split submission

• Member State where activity is

carried out in a salaried capacity

• Annex VII deleted

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Simultaneous employment: comment

• Single legislation is applicable as if the activities

concerned are entirely carried out in one Member

State requalification

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Exception article

Article 17 R° 574/72/71 Article 16 §1 R° 883/2004

• Common agreement

• Exception to Article 13-16 R°

in the interest of the person

concerned

• Common agreement

• Exception to Article 11-15 R° in

the interest of the person

concerned

• Request must, if possible, be

priorly filed with the competent

authorities of the institution of

the Member State whose

legislation the employee or the

person concerned wishes to

apply.

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E 101

• E101 replaced by electronic exchange

SED101

• Binding until withdrawal or annulment by the Member

State which has delivered it

• Paper only upon request

• Institution of the detachment state delivers it

• In case of simultaneous employment:

Article 12bis R° 574/72/71 Article 15, 16 & 19§1 R° 987/2009

• Institution of known place of

residence

• Institution delivers proof of

submission

• Institution of the known place of

residence

• Article 19: Upon request of the

person or employer concerned the

institution delivers a declaration

stating the applicable legislation

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Simultaneous existence of two Regulations

• Old R°1408/71:

– Applicable in Switserland, Norway, Iceland and Liechtenstein

– Applicable to third country nationals

• New R°883/2004

– In force as of 1 May 2010

• Transition period: application of R°1408/71 continues:

– If on the basis of R°883/2004 subject to social security of another

state

– As long as “the situation concerned persists” (?)

– Maximum 10 years

– Unless the party concerned asks for the application of R°883/2004

within 3 months

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Thank you for your attention !

Filip SAELENSfilip.saelens@loyensloeff.com

0032 2 773.23.29

Diane ECTORS Johan KERREMANSdiane.ectors@loyensloeff.com johan.kerremans@loyensloeff.com

0032 2 743.43.45 0032 2 743.43.76