A brief reference to the ongoing review of the EU system of social security coordination


by Sophie Perez Fernandes, Junior Editor

The right to move and reside freely within the territory of the Member States, which is granted to EU citizens and members of their families, is one of the freedoms on which the European integration process is based. Apart from fundamental economic freedom, which is embedded in the professional freedoms guaranteed by the Treaties as pillars of the internal market (free movement of workers, freedom of establishment and freedom to provide services)[i], the free movement and residence of nationals of the Member States forms part of the essential core of their status as EU citizens[ii], as well as being recognized as a fundamental right[iii].

Although so framed in EU primary law, this right to move and reside freely would not be practicable if were not protected the social security rights of those who actually exercised it by moving from one Member State to another, accompanied or not by their families. For the so-called dynamic citizens, it was necessary for EU law to provide them with adequate protection in the fields of social security with the aim of avoiding that the particularities of the national social security systems of the different Member States would hinder the exercise of their freedom of movement. The first EU regulation in this area dates back to the 1950s, and over the ensuing decades the normative and jurisprudential acquis framing the coordination of social security systems has been solidified and complexified, seeking to balance the preservation of the competences of the Member States in the fields of social security and to ensure the continuity of social protection of individuals beyond Member States.

Since 1 May 2010, Regulation 883/2004 (“basic Regulation”), together with Regulation 987/2009 (“implementing Regulation”), have institutionalized a modernized system of social security coordination[iv], which, drawing on the experience gained under the previous schemes, seeks to simplify EU rules in this area and to promote the protection of the rights of the persons covered. Even so, both regulations have already been amended[v], and a forthcoming amendment of the current regime is under discussion, having the Commission already presented a proposal. The proposal focuses on four areas of coordination: economically inactive citizens’ access to social benefits, long-term care benefits, unemployment benefits and family benefits.

In particular, the first point concerns the recent case-law of the European Court of Justice addressing the issue of access to non-contributory cash benefits claimed by economically inactive EU mobile citizens – cases like Dano, Alimanovic and Commission v United Kingdom. Such case-law has also given rise to a heated debate in legal literature (on this blog, see here, here and here). At the heart of the problem is the cross-interpretation of some provisions of the so-called Citizenship Directive, on the right of citizens of the Union and their family members to move and reside freely within the territory of the Member States (Directive 2004/38), and the basic Regulation on the coordination of social security system (Regulation 883/2004).

Thus, following such case-law, the Regulation 883/2004 ongoing review is, inter alia, aimed at clarifying the circumstances in which Member States may limit access to such non-contributory social benefits required by mobile but economically inactive EU citizens. In its proposal, the Commission explains the need for such clarification for reasons of clarity, transparency and legal certainty. According to data released in the proposal, the population of economically inactive mobile citizens is estimated to be (only) 3.7 million and nearly 80% of them derive rights (of residence and/or to benefits) from economically active family members with whom they reside, and continue to be entitled to equal treatment with the family members of national workers.

In practical terms, the proposal foresees an amendment to the provisions on equal treatment laid down in Regulation 883/2004 in order to make reference to the limitations set out in Directive 2004/38 and to take into account the case-law of the Court of Justice. In addition to some amendments in initial recitals of Regulation 883/2004, its Article 4 would provide that, in relation to access to social security benefits by economically inactive mobile EU citizens in the host Member State, the principle of equal treatment may be subject to the requirement to hold legal residence as set out in Directive 2004/38. The proposal further clarifies that an economically inactive mobile EU citizen does not include a mobile jobseeker who enjoys a right of residence in the host Member State while looking for a job there. Under the proposal, Article 4 of Regulation 883/2004 would read as follows:

«1. Unless otherwise provided for by this Regulation, persons to whom this Regulation applies shall enjoy the same benefits and be subject to the same obligations under the legislation of any Member State as the nationals thereof.

2. A Member State may require that the access of an economically inactive person residing in that Member State to its social security benefits be subject to the conditions of having a right to legal residence as set out in Directive 2004/38/EC of the European Parliament and of the Council of 29 April 2004 on the right of citizens of the Union and their family members to move and reside freely within the territory of the Member States.»

The Commission’s proposal has the added value of seeking to clarify, for the sake of transparency and legal certainty, the current state of EU law as interpreted by the Court of Justice in a highly complex and politically sensitive matter. Whatever the outcome of this particular point of the proposal, it is important that it would not represent a yielding to the pressure of populist and xenophobic trends that increasingly poison national public opinions and undermine the very understanding of the process of European integration among its own citizens.

[i] Articles 45, 49 and 56.º TFEU.

[ii] Articles 20(2)(a) and 21 TFEU.

[iii] Articles 15(2) and 45 CDFEU.

[iv] Article 153(1)(k) TFEU.

[v] See Regulation 1231/2010 and Regulation 1244/2010.

Picture credits: Michelangelo abstract (…)  by PublicDomainPictures.

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