EXECUTIVE SUMMARY
The coordination of social security systems within the EU aims at ensuring that each EU citizen and third country national residing in the EU has fair access to social security regardless, of the country where he or she stays.
Social security coordination law has been a fundamental pillar of the free movement of persons since the inception of the European integration process. Envisaged by the 1951 Paris ECSC Treaty, a comprehensive regime of the coordination of national social security systems was established as early as 1958 by the foundational EEC regulations 3 and 4. Since then, EU social security coordination law has co-evolved in tune with the deepening of the integration process as well as with its expansion and the gradual accession of new Member States up to the enlargement in 2004-2007. Currently, coordination rules are provided for by the Regulation (EC) 883/2004 and its Implementing Regulation (EC) 987/2009.
Coordination rules do not remove substantive differences between national systems, including the possible negative effects of crossing borders due to different levels and standards of social protection in each country, nor do they compensate for such effects.
Irrespective of such inherent limits, these rules provide for a fundamental pre-condition for exercising free movement rights within the EU, preventing national social security rules from impeding this freedom by: a) prohibiting any form of (direct or covert) discrimination on grounds of nationality; b) mandatorily and exclusively determining the applicable legislation; c) allowing the aggregation of periods of insurance, work or residence fulfilled in another Member State in order to satisfy the qualification periods for benefits and to calculate their level; d) removing any territorial requirement for the payment of such benefits; f) promoting good administrative cooperation among Member States’ social security institutions with the aim of smoothing the effective exercise of rights (and duties) conferred upon individuals by the regulations.
The material scope of the coordination rules includes: (a) sickness benefits; (b) maternity and equivalent paternity benefits; (c) invalidity benefits; (d) old-age benefits; (e) survivors’ benefits; (f) benefits in respect of accidents at work and occupational diseases; (g) death grants; (h) unemployment benefits; (i) pre-retirement benefits; and (j) family benefits.
As for the applicable legislation, in general EU citizens are covered by the State of employment or of last employment if they are economically active, while they shall receive benefits by the State of residence if economically inactive.
Yet, the actual classification of benefit schemes or of citizens’ statuses under the different and evolving national social security systems may create uncertainties on which legislation applies depending to the case at hand. These problems add up to shortcomings in information sharing between the relevant administrations, leading to increased risk of unfair outcomes concerning access to benefits.
In a view to modernise and simplify existing rules, as well as guarantee a fair burden sharing of social security costs between Member States, the European Commission presented a proposal of revision to the coordination rules in December 2016 (COM (2016) 815 final).
The main changes proposed by the Commission cover: 1) the limits of application of the equal treatment principle for non-economically-active EU citizens; 2) the rules on exporting unemployment benefits and on unemployment protection for cross-border workers; 3) the introduction of a new chapter on long-term-care benefits; 4) the partial revision of the rules on family benefits with a new provision on child raising allowances; 5) the definition of posted workers for the purpose of social security coordination and the strengthening of related administrative tools; 6) the fine-tuning of existing (and mostly technical) rules on administrative cooperation between Member States.