Social security coordination-merely residence might determine prior subjection

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.

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Oct 26, 2018
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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.

Summary of the case in the main proceedings

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.

Summary of the legal context

Article 14 of Regulation No 987/2009 provides in paragraph 1:

For the purposes of the application of Article 12(1) of [Regulation No 883/2004], a “person who pursues an activity as an employed person in a Member State on behalf of an employer which normally carries out its activities there and who is posted by that employer to another Member State” shall include a person who is recruited with a view to being posted to another Member State, provided that, immediately before the start of his employment, the person concerned is already subject to the legislation of the Member State in which his employer is established.’

Brief of the questions referred to the European Court of Justice

The questions referred to the ECJ can be summarised to whether Article 14(1) of Regulation  987/2009, read together with Article 12(1) of 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) of Regulation No 883/2004, was in that Member State.

Summary of the ECJ’s ruling

The ECJ underlines first, the fact that subject to compliance with the conditions laid down by Article 12(1) Regulation 883/2004 , a person who is recruited with a view to being posted to another Member State, can be regarded as “ a person who pursues an activity as an employed person in a Member State on behalf of an employer which normally carries out its activities there and who is posted by that employer to another Member State”, and as a consequence, such a person shall remain subject to the legislation of the Member State in which his employer normally carries out its activities.

In any circumstances, the person must have already been subject to the legislation of the Member State in which the employer is established. Such a subjection must be examined within the meaning of Article 14(1) Regulation 987/2009.

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.

The nationality, it is not itself among the criteria laid down by the conflict rules in Title II of Regulation 883/2004.

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.

The Court concludes that : Article 14(1) of Regulation (EC) No 987/2009 of the European Parliament and of the Council of 16 September 2009 laying down the procedure for implementing Regulation (EC) No 883/2004 on the coordination of social security systems, read together with Article 12(1) of Regulation (EC) No 883/2004 of the European Parliament and of the Council of 29 April 2004 on the coordination of social security systems, as amended by Regulation (EU) No 465/2012 of the European Parliament and of the Council of 22 May 2012, must be interpreted as meaning that an employee recruited with a view to being posted to another Member State must be regarded as having been ‘just before the start of his employment … already subject to the legislation of the Member State in which his employer is established’, within the meaning of Article 14(1) of Regulation No 987/2009, even if that employee was not an insured person under the legislation of that Member State immediately before the start of his employment, if, at that time, that employee had his residence in that Member State, which is for the referring court to ascertain.

Go to the profile of Tanel Feldman

Tanel Feldman

Managing Partner, Immigration Law Associates

Corporate Immigration Law/Employment Law/Social Security Law/European Law

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