Assessing intra-EU mobility cases, the concept of residence, cannot be given an interpretation which permits its autonomous and uniform application.
The fact that (e.g.) the right to reside under Directive 2004/38, the residence for social security purposes, and the tax residence are different concepts, is only the tip of the iceberg.
The rather complex interoperability between the EU law and national legislations, adds a level of complexity.
In Neculai Tarola v Minister for Social Protection (C-483/17), Mr Tarola, argued that pursuant to Article 7(3)(c) of Directive 2004/38, he had the right to reside in Ireland as a worker, for a period of six months, after completing two weeks employment.
The High Court of Ireland held that Mr Tarola, could not be regarded as a ‘worker’ and thus as habitually resident in Ireland. Consequently, he could not claim social assistance in that capacity. The period of work completed by Mr Tarola could not be regarded as a fixed-term contract of employment, and thus the applicant would be entitled to jobseeker’s allowance only if he would had been in continuous employment for one year prior to applying for social security assistance.
In the light of settled ECJ’ case law (see inter alia Vatsouras and Koupatantze C‑22/08 and C‑23/08), the Court of Appeal (Ireland) ruled out the doubt in regard to the status of worker and has referred to the ECJ the question whether or not the applicant retains such a status.
Advocate General Szpunar takes the view that pursuant to Article 7(1)(a) and (3)(c) Directive 2004/38, a national of a Member State, who has been employed in another Member State for a period of two weeks, otherwise than as a fixed-term worker, and who thereafter becomes involuntarily unemployed, retains the status of worker within the meaning of those provisions and, therefore, the corresponding right of residence for no less than six months.
It must be observed that Mr Tarola’ s right to reside in Ireland, will not necessary determine an habitual residence in the latter country. Pursuant to the national legislation, when determining whether a person is habitually resident in the State, a deciding officer, will take into consideration all the circumstances of the case including, in particular the length and continuity of residence in the State or in any other particular country, the length and purpose of any absence from the State, the nature and pattern of the person’s employment ,the person’s main centre of interest, and the future intentions of the person concerned as they appear from all the circumstances. Provided that the habitual residence cannot be established, Mr Tarola will be eligible only to the supplementary welfare allowance (and not to jobseeker’s allowance).
in Eugen Bogatu v Minister for Social Protection (C‑322/17), Advocate General Mengozzi, analyses the scope of the concept of ‘activity as an employed person’, in the sense of Articles 67 and 68 Regulation 883/2004 on the coordination of social security systems (i.e. entitlement to family benefits where members of the family are residing in another Member State, and priority rules in the event of overlapping benefits).
The case in the main proceedings concerns a Romanian national who after having been employed in Ireland and subsequently having lost his job, has received only non-contributory benefits (jobseeker’s allowance). whilst remaining insured under the social security scheme of the latter Member State. He was refused family benefits for his children residing in Romania, for the period during which he received the jobseeker’s allowance, on the ground that he could not be regarded as pursuing an activity as an employed person, for the purposes of Article 67 Regulation 883/2004.
Advocate General Mengozzi, suggests that in accordance to the adage ‘lex specialis derogat legi generali’, where a situation is governed by one of the special rules governing connecting factors which are provided for in Title III Regulation 883/2004, the general conflict rules which are set out in Title II the said regulation, do not apply.
Having regard to the above consideration, referring to the different arguments brought by the parties, Advocate General Mengozzi, takes the view that Article 11(2) cannot be used to interpret the concept of ‘activity as an employed person’, for the purposes of Article 68 Regulation 883/2004 (pursuant to Article 11(2), ‘persons receiving cash benefits because or as a consequence of their activity as an employed … person shall be considered to be pursuing the said activity’).
Advocate General Mengozzi takes the view that in order to preserve the practical effect of the order of priority provided for in Article 68 Regulation No 883/2004, to interpret the concept of ‘activity as an employed person’ for the purposes of the said article, reference must be made to the definition laid down in Article 1 Regulation 883/2004 (“activity as an employed person” means any activity or equivalent situation treated as such for the purposes of the social security legislation of the Member State in which such activity or equivalent situation exists’).
Having regard to the above considerations, only if the pursuit of such an activity, or the existence of an equivalent situation can be established under the social security legislation of the Member State of employment, the latter Member State would be deemed to have primary responsibility for the payment of family benefits.
It must be noted that the eligibility to the payment of family benefits in Ireland would not be conditioned by the ‘habitual residence condition’.
In Walltopia’ AD (C‑451/17), the European Court of Justice, brings an expected interpretation of Article 14(1) Regulation 987/2009, and emphasize the overriding value of the concept of residence under Regulation 883/2004, in relation to the one of prior subjection pursuant to national legislations.
A Bulgarian national, was hired by Walltopia with a view to being posted to the United Kingdom. Subsequently, the competent authority in Bulgaria, refused to issue a PDA1, on the ground that the person concerned had not been subject to the social security in the latter country, for at least one month before his posting.
The questions referred to the ECJ can be summarised to whether Article 14(1) Regulation 987/2009, read together with Article 12(1) Regulation 883/2004, must be interpreted as meaning that an employee recruited with a view to being posted to another Member State, and not having the status of insured person under the legislation of the sending Member State, must be regarded as having been ‘immediately before the start of his employment … already subject to the legislation of the Member State in which his employer is established’, if just before the start of his employment, he was a national of that Member State and his residence, within the meaning of Article 1(j) Regulation 883/2004, was in that Member State.
The ECJ underlines that on the one hand, Title II Regulation 883/2004, aims to grant the exercise of freedom to provide services, and on the other hand, to ensure that persons covered by that regulation are not left without social security cover. In context, the legislation of a single Member State shall apply.
The ECJ observes that unless the case fails within the situations mentioned in Article 11(3) (a) to (d) Regulation 883/2004, pursuant to Article 11(3)(e),the legislation applicable to the posted worker before the start of his employment, is deemed to be the legislation of the sending Member State, merely if the worker’s residence, in the meaning of Article 1(j) Regulation 883/2004, was In that Member State.
Lastly, the ECJ recalls that where on the one hand, Title II Regulation 883/2004 is solely intended to coordinate the social security systems and not to lay down conditions determining subjection right in different Member States, on the other hand, the conditions provided for by national legislations, cannot be in breach of the EU law. National laws may not alter/replace the coordination rules laid down by Regulation 883/2004 and determine the legislation applicable for social security purposes.
Determining the right to affiliate, the national legislation, cannot have the effect of excluding from its scope, persons to whom, pursuant to Regulation 883/2004, that legislation is applicable.
It must be observed that pursuant to Article 1(j) Regulation 883/2004, ‘residence’ means the place where a person habitually resides’, and the elements for determining residence are provided for by Article 11 Regulation 887/2009.
Lawful residence only, would not determine the same right (unless prior subjection to the social security in Bulgaria, for at least one month prior to the posting can be established).
In his Opinion delivered on Balandin and Others’ (C-477/17), Advocate General Wahl proposes a first interpretation of the concept of “lawful residence” in the sense of Regulation 1231/2010.
The case concerns third-country nationals, who pursue gainful employment in the Netherlands, covered by short-stay Schengen visa (and by virtue of national legislation, exempt from the obligation to hold a work permit). On behalf of their employer, they perform work activities in other Member States, covered by the same short-stay Schengen visa, eventually complemented by national short-stay visas.
The question referred to the European Court of Justice, is whether the competent authority of the Member State of employment, must issue the Portable Document A1, to third-country nationals who work in various Member States on a temporary basis, and reside outside of the European Union (lawful stay in the European Union covered by short-stay visa).
The Advocate General observes first that pursuant to settled ECJ’ case law, third-country nationals holding a residence permit in a Member State, fulfil the criterion of lawful residence in the sense of Regulation 1231/2010.
Regulation 1231/2010 neither provides for a definition of the concept of lawful residence, and nor contains any reference to national legislations. Considering the need for an uniform application of EU law and the principle of equality, it follows that the concept must be ‘given an autonomous and uniform interpretation throughout the European Union’.
The concept of lawful residence determined by the conditions of entry, stay and residence under national legislations, is not relevant as the case at issue, however, such conditions are not fully harmonised under the EU law.
Having regard to the above considerations, under the social security coordination legislation, third-country nationals may not invoke any right to enter, stay, reside and work in a Member State. Such legislation produces its effects only if the person concerned is already legally resident in the territory of a Member State.
Referring to the observations submitted by the parties, the Advocate General takes the view that the concept of residence provided for by Article 1(j) Regulation 883/2004 and interpreted by Article 11 Regulation 987/2009, represents a factual concept, and as a consequence, irrelevant for the interpretation of the term “legally resident” in the sense of Regulation 1231/2010.
Practically, the Opinion distinguishes between on the one hand, the concepts of “residence” and” temporary stay” for the purposes of Regulation 883/2004 and its implementing regulation, considered as a question of fact, which must be answered by reference to facts and evidence, and on the other hand, the concept of “legally resident” in a Member State, in the sense of Regulation 1231/2010, which must be strictly determined as a matter of EU law.
Pursuant to the ECJ’ settled case law, such a determination must consider the wording, the context and the objectives pursued by the rules of law.
Firstly, only a lawful residence in a Member State, would not satisfy the second criterion provided for by Article 1 Regulation 1231/2010. The third-country nationals concerned, must be beneficiaries of the right to move and reside in the European Union.
Advocate General Wahl observes that two categories of third-country nationals may enforce the right to move and reside in the European Union: those whose right is provided for by EU legal instruments (such as but not limited to the Blue Card Directive and the Intra Corporate Transfer Directive), and those whose right is derived from a legal status, on grounds of national law.
However, as the conditions of entry and residence of third-country nationals are not fully harmonised, and the criteria determining such rights vary among the Member States, in order to qualify for legal residence in the sense of Regulation 1231/2010, third-country nationals belong to the second category, must hold a residence permit.
The Advocate General concludes that beyond the categories above referred to, third-country nationals, cannot be deemed to be legally resident in the sense of Regulation 1231/2010, and as a consequence, may not invoke (Title II of) Regulation 883/2004 and Regulation 987/2009.
The Opinion is controversial.
The Opinion is based inter alia on the fact that the third-country nationals concerned, have stayed in the Schengen territory for a period beyond 90 days in any 180-day period, enforcing the right to obtain national visas. They could instead obtain residence permits, on grounds of the Single Permit Directive.
Provided that the duration of stay does not exceed 90 days in any 180-day period, on the one hand, pursuant to Article 3.1(a) Single Permit Directive, the said directive applies to “third-country nationals who apply to reside in a Member States for the purpose of work”, and on the other hand, pursuant to Article 3.4, the provisions of Chapter II (Single application procedure and single permit), ‘shall not apply to third-country nationals who are allowed to work on the basis of a visa’. The category of third-country nationals allowed to work on the basis of a visa, covers multiple situations, such as : short stay Schengen visa on grounds of work permit exemption, short stay Schengen visa accompanied by a work permit, long stay national visas issued to employees intend to stay and work for a duration exceeds three months and does not exceed one year (e.g. VLS-TS visas issued by France).
Considering that stays for the purpose of work, does not exceed 90 days in any 180-day period, are not considered as residence, third-country nationals intend to stay and work for such a duration, can be submitted to the obligation to hold a work permit, however, do not have the choice to be issued a residence permit.
Another question would be the determination of the employment status in the “host” Member State.
Advocate General Wahl, rules out the relevance of Article 56TFEU (freedom to provide services), and implicitly, the status of ‘posted worker’.
It must be observed that the social security coordination regulations and the Directive 96/71/EC (Posted Workers Directive) are hermetic legal instruments.
As the case at issue, the third-country nationals have an employment contract with the Dutch employer and have social security cover in the Netherlands.
The definition of posted worker provided for by Article 2 Directive 96/71/EC, does not contain any reference to the residence status.
Pursuant to Article 8 Regulation 593/2008 (Rome I), where the country from which the employee habitually carries out his work cannot be determined, the place of business through which the employee was engaged must be considered.
In C-18/17 (Danieli and Others), Advocate General Wahl takes the view that: ‘the directive applies to a wide array of situations in which workers are transferred from one Member State to another in the context of cross-border provision of services’ (i.e. the Posting of Workers Directive).
It must be finally observed that the proposal amendment of Regulation 883/2004 and Regulation 987/2009, introduces a new provision for the purposes of applying Article 13 of the basic Regulation in relation to a person who resides outside the territory of the Union, and pursues his/her activities as an employed or self-employed person, in two or more Member States. Such a person’s residence will be deemed to be in the Member State where the latter pursues the major part of his/her activities, in terms of working time within the territory of the Union.
Article 13, Regulation 883/2004, covers both categories, persons simultaneously employed in different Member States (coordinating contracts of employment usually referred to as global employment contracts), and persons employed by an undertaking established in one Member State, posted to perform successively or simultaneously work activity in two or more Member States. A person posted to perform work irregularly in two or more Member States, would be covered by Article 13, if that is he habitual pattern of work.
Lastly, we take the view that it must be distinguished between the abuse of right in the sense of Halifax and Others (C‑255/02), and ‘using a combination of exceptions found in EU law and national laws’ in the sense of the Opinion delivered by AG Wahl.