Determining the applicable national social security scheme An overview of the main rules in Regulations n° 883/2004 & 987/2009,

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 2 Co-ordination of social security schemes “Determination of the legislation applicable” Is one of the basic principles of coordination Provides an answer to: 1. «Where do I have to pay contributions?» 2. «According to which scheme will I get social security benefits?»

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 3 Determining the applicable scheme Overarching principle Unicity of legislation avoids both positive and negative conflicts of law Strong & exclusive effects

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 4 

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 5 The EU social security provisions Since 1972: Regulation n° 1408/71 & its Implementing Regulation n° 574/72  European Economical Area (EEA) Agreements with Switzerland (2002) Regulation n° 859/2003: extension to third country nationals (2003):  In an intra-EU cross-border situation  Legally resident in the territory of an EU Member State  [Not accepted by Denmark]

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 6 A reform Starting from 1 May 2010: Regulation (EC) n° 883/2004 its implementing Regulation n° 987/2009 But:  … a transitional period of 10 years for the Chapter on applicable legislation in case of an unchanged prior existing situation  … no extension to third-country nationals yet (2012?)  … not applicable to Switzerland yet (2011?)  … not applicable to Iceland, Norway and Liechtenstein yet (2011?)

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 7 Special rules * State of habitual residence * State where the employer is situated Activities in the territory of several States (employee / self-employed) Special rules State of work (Lex loci laboris) Exception: Posting Activities in the territory of one State (employee / self-employed) Determining the applicable scheme

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 8 “Lex loci laboris”

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 9 Changing place of work

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 10 Coverage in the State where activities are carried out for a short period of time = ADMINISTRATIVE COMPLICATIONS Changing place of work

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 11 Posting A definition An employee / self-employed person is sent abroad by his employer / goes abroad to perform a well-defined task for a limited time  whilst remaining under the authority of his employer  whilst continuing to maintain, in the State of origin, the necessary means to carry on the self-employed activity so as to be in a position to pursue it on his return.

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 12 Consequences 1. The employee / self-employed person continue to be covered by their habitual social security scheme (the sending State) 2. The employer / self-employed person are exempted from the payment of social security contributions in the receiving State Posting

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 13 Administrative Commission:  Decision A2 Substantive conditions  Posting guide Substantive conditions Posting Substantive conditions – interpretations & guidelines

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 14 Posting Substantive conditions Social security coverage prior to the posting  How long? Decision A2  Employees 1 month – Self-employed workers: 2 months The employer must  “Habitually” carry on “significant activities” in the sending State Caselaw ECJ - Fitzwilliam & Plum Old Posting guide: 25% turnover – 4 months of activities └► in Regulation 987/2009 art. 14 §2 with a series of criteria (i.e. not purely management activities)

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 15 Posting  Expected maximum duration: 24 months

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 16 Posting  For self-employed persons: Similar activity ( → actual nature of the activity)

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 17 Formalities in case of posting Portable Document A1 Model Administrative Commission A1

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 18 Special rules Civil servants Continue to be insured in the State in whose Administration they are employed Staff members of diplomatic missions Principle: the State of work, but possibility to opt for the scheme of the sending State (when being a national of that Member State) Auxiliary staff of the EU Choice: the State of work, the State they were last subject to, or the State of their nationality → Contract staff

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 19 Simultaneous activities "normally employed in the territory of two or more Member States"

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 20 Simultaneous activities Special rules * State of habitual residence * State where the employer is situated Activities in the territory of several States (employee / self-employed) Special rules State of work (Lex loci laboris) Exception: Posting Activities in the territory of one State (employee / self-employed)

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 21 Substantially working in the State of residence (25%)? Not substantially working in the State of residence? BUT: if ≠ employers established in ≠ States Simultaneous activities Employee

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 22 Simultaneous activities Employee (1) The Netherlands  Belgium (4d/wk)  Dutch employer  The Netherlands (1/wk)  Dutch employer

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 23 Simultaneous activities Employee (2) The Netherlands  Belgium (4d/wk)  Belgian employer A  The Netherlands (1/wk)  Belgian employer B

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 24 Simultaneous activities Employee (3) The Netherlands  Belgium (4d/wk)  Belgian employer  The Netherlands (1/wk)  Dutch employer

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 25 Substantial activities pursued in the State of residence ? No substantial activities in the State of residence? Simultaneous activities Self-employed

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 26 Simultaneous activities Self-employed The Netherlands  60% Belgium  60%  25% Luxemburg  25%  15% The Netherlands  15%

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 27 Entirely covered in the State where the employed activities are pursued Simultaneous activities Employee & self-employed

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 28 Civil servant & employee and/or self- employed  State of civil servant Simultaneous activities Civil servant + Employee & self-employed

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 29 Mariners  Main rule: Covered in the State whose flag the ship is flying  Exception: Employer & residence of the mariner in the same Member State: covered in that State Special rules

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 30 The Escape Clause Two or more Member States, the competent authorities of these States or the bodies designated by these authorities may by common agreement provide for exceptions to the provisions of articles (11-15) in the interest of certain categories of persons or of certain persons.

Belgrade 2010 applicable social security scheme (Reg 883/2004) by B. De Pauw 31