2010 - Modernised EU Social Security Coordination and Old-Age Pensions

DG Employment, Social Affairs and

Equal Opportunities

Modernised EU Social Security Coordination and

Old-Age Pensions

TRESS Seminar Ljubljana, 19th April 2010Radek Casta, Unit E3, DG Employment, European

Commission,

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Overview

• The Context of the Social Security Coordination Regulations• Introduction to the Chapter Applicable Legislation• « Hot Issues » under this Chapter• Electronic exchange of social security information

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Basic Principles of Social Security Coordination

Legal Basis Article 48 of Lisbon Treaty (Art. 42 TEC): aim to ensure citizens do not lose social security rights

when they move

• Equality of treatment regardless of nationality• Legislation of only one Member State applies at any one

time• Periods of insurance acquired in different Member States

can be aggregated• Cash Benefits have to be exported (except special non-

contributory cash benefits listed in Annex 10)

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Reg 1408/71

Reg 574/72

Consolid Reg

Reg 987/2009

Reg 883/2004

Regulations 3 & 4

Over 50 years of Social Security Coordination

19591959 19721972 19971997 20102010

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Two New Regulations

• Regulation 883/2004 (the Basic Regulation) ('BR'), as amended by Reg. 988/2009

• The New Implementing Regulation 987/2009 ('IR')

• Both Regulations of equal value

• Cannot apply one without the other

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New Regulations: Key Themes

• Updating so rules correspond with current social practices (eg. inclusion of paternity benefits)

• Simplification (eg. One single definition in Article 2 BR sets out personal scope)

• Clarification - incorporation of ECJ case-law in a range of areas (eg. Article 5 BR – Assimilation of facts)

• Improved protection of rights (eg. Article 61 BR - principle of aggregation applies also to self-employed persons)

• Mandatory electronic data exchange (Art. 4 IR)

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2 core principles underpinall of this:

• Institutional procedures have been strengthened and streamlined to make the Regulations easier and more efficient to operate;

• New emphasis on cooperation between all users of the Regulations

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Strengthened and Streamlined Institutional Procedures

For example:

• Improved and speedier procedures for reimbursement of healthcare costs between Member States (Articles 62-67 IR);

• Direct payment of exported unemployment benefit without need for consequent reimbursement between institutions (Article 64 BR)

Core principles of modernisation (1)

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Core principles of modernisation (2)

Enhanced Cooperation

"Clear and more effective cooperation between social security institutions is a key factor in allowing the persons covered by regulation (EC) 883/2004 to access their rights as quickly as possible and under optimum conditions“

[Preamble of the NIR, second paragraph ]

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Overall aim: to facilitate institutional processes whilst at the same time making citizens’ rights more effective

• Art. 76 BR invigorated through new specific provisions, for example:

– Art. 3 IR: requirement on institutions and citizens to provide information

• Art. 76 BR given practical effect through structured provisions throughout the Regulations, for example:

– Article 55(4) IR – providing information to competent institution concerning the follow-up of the unemployed person’s situation

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Core of Modernisation:Enhanced Cooperation

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Legislation Applicable Overview

1. Simplification

2. Improved protection for individuals

3. Modernisation and Clarification

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• One legislation applicable

• Lex loci laboris for active persons

• Residence for non-active persons

1. Simplification:

Reinforcement of the general principles

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• Similar rules are brought together in one place

• Specific cases are addressed through

the general principles

1. Simplification:

Reduction in the numberof specific provisions

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"Clear and more effective cooperation between social security institutions is a key factor in allowing the persons covered by regulation (EC) 883/2004 to

access their rights as quickly as possible and under optimum conditions."

Preamble of the IR, second paragraph


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76 BR:Duty of mutual information and cooperationfor institutions and persons covered by the regulations

2(1) IR: "Exchanges between Member States' authorities and institutions and persons covered by the basic regulation shall be based on the principles of public service, efficiency, active assistance, rapid delivery and accessibility…"


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6(1) IR:

Divergence of views about the legislation applicable: person provisionally subject to one legislation identified with an order of priority

6(2) IR:

Divergence of views about which institution should provide the benefits: institution identified with an order of priority

Provisional application of legislation and provisional granting of benefits


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6(3) IR: Dialogue and conciliation procedure

in the event of:• Doubts about the validity of a document or

the accuracy of the facts• Difference of views concerning the determination

of the applicable legislation • Difference of views about which institution should

provide the benefits in cash or in kind

Dialogue and conciliation procedure


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Dialogue and conciliation mechanisms

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On posting, the new regulations:

• Set one-time limit of maximum 24 months

• Incorporate several elements resulting

from European Court of Justice case law

and Administrative Commission decisions

3. Modernisation and clarification

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Activities in 2 or more Member States for the same employer

Introduction of a new criterion in Article 13 of BR: • The proportion of activity exercised in

the Member State of residence has to be substantial for the legislation of residence to apply

• Otherwise – if no substantial proportion of activity in the Member State of residence: refer to legislation of employer


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B

Activitiy in other Member States then in the MS of residence

ALegislation applicable = Member State BLegislation applicable = Member State B


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B

Activities in 2 or more Member States for the same employer (Attention: in the future also several employers)

AOnly if substantial part of activities in the Member State of residence

Legislation applicable = Member State ALegislation applicable = Member State A


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C B

Activities in 2 or more MS for 2 or more employers,

with registered offices or plase of business in different Member States

AIf 2 or more employers and registered offices/place of business in different member states

, Member State of residence

Legislation applicable = Member State ALegislation applicable = Member State A


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B

Activities in 2 or more Member Statesfor 2 or more employers, including in the Member State of residence (Attention: will change)

A(in the future: only if substantial activity in MS of residence)

Legislation applicable = MS of residenceLegislation applicable = MS of residence


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If two or more Member State institutions have different views about the determination of residence,

Article 11 of IR provides a list of criteria. In the event that no agreement is reached,

the person's intention is decisive.

Determination of residence


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Revised by the Administrative Commission:

• Decision 181 (new Decision A2)

• Posting Guide

Repealed by the Administrative Commission:

• Recommendation 16 on conclusion of agreements pursuant to article 17 of 1408

• Decision 89 on persons employed by diplomatic missions and consular posts

• Decision 126 on Article 14(1)a, 14a(1)a & 14(b) 1 & 2• Decision 148 on form E101

Revision of Decisions and Recommendations of

the Administrative Commission


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What if new provisions imply a change of the legislation applicable?

Article 87(8) of BR provides for transitional provisions in this case.

Transitional provisions


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Transitional provisions

Article 87(7) BR

• Legislation determined under 1408/71 continues to apply– if as a result of application of 883 person would become subject

to different legislation

– as long as relevant situation remains unchanged

– For a maximum period of 10 years

• Person can request to become subject to the legislation applicable under 883.

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A document for individuals – indicating which legislation applies in their case –

will be needed:

Portable Document A1 will replace E-Form 101

Portable documents


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« Hot issues » = Issues under DiscussionOverview

• Highly Mobile Persons• International Transport• Concept of Residence• Posting Guide• Transitional Provisions

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EESSI

Network

Electronic Exchange of Social Security Information

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II

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AP AP

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EESSI

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EESSI Implementation: How will it work?

MAYMAY20102010

DEC.DEC.20102010 20112011

MAYMAY20122012

EESSI FULLY OP

PAPER PAPER E-FORME-FORM PAPER PAPER SED'SSED'S ________ ________ ________ ……..…... ……….....

NATIONAL NATIONAL APPL. AS APPL. AS E-FORMSE-FORMS

__ ________ ________ ________ ……….....

FINAL FINAL SED'SSED'S ………….. ………….. ………….. ________ ________

SED = Structured Electronic DocumentsSED = Structured Electronic Documents

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Funding for Transnational Actions

Actions:

• Improving information and cooperation between the institutions of Member States, and/or

• Improving citizens’ knowledge on their rights

• Subsidy up to 80% • Call for proposal VP/2010/004 (deadline 17/05/2010)• Published on DG EMPL website• Publication again in 2011

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Where can I find more information?

• Our Website• Updated Small Guide• Explanatory Notes• TrESS e-learning tool and European Reports• Updated and extended posting guide (not yet

available)