### after having received a pre - conversion certificate , and after verifying that the incorporation requirements in the destination member state are fulfilled , the competent authorities of the destination member state should register the company in the business register of that member state . only after this registration should the competent authority of the departure member state strike the company off its own register . it should not be possible for the competent authority of the destination member state to challenge the accuracy of the information provided by the pre - conversion certificate . as a consequence of the cross - border conversion , the converted company should retain its legal personality , its assets and liabilities and all rights and obligations , including rights and obligations arising from contracts , acts or omissions . ### after having received a pre - conversion certificate , and after verifying that the incorporation requirements in the destination member state are fulfilled , the competent authorities of the destination member state should register the company in the business register of that member state . only after this registration should the competent authority of the departure member state strike the company off its own register . it should be possible for the competent authority of the destination member state to submit questions to the competent authority n the member state of departure as to the accuracy of the information provided by the pre - conversion certificate , in particular to avoid an artificial arrangement . the competent authority of the member state of departure shall reply to such questions without undue delay . as a consequence of the cross - border conversion , the converted company should retain its legal personality , its assets and liabilities and all rights and obligations , including rights and obligations arising from contracts , acts or omissions .


### in order to ensure that employee participation is not unduly prejudiced as a result of the cross - border conversion , where the company carrying out the cross - border conversion is operating under an employee participation system in the departure member state , the company should be obliged to take a legal form allowing for the exercise of such participation , including through the presence of representatives of the employees in the appropriate management or supervisory organ of the company in the destination member state . moreover , in such a case , a bona fide negotiation between the company and its employees should take place , along the lines of the procedure provided for in directive 2001 / 86 / ec , with a view to finding an amicable solution reconciling the right of the company to carry out a cross - border conversion with the employees ' rights of participation . as a result of those negotiations , either a bespoke and agreed solution or , in the absence of an agreement , the application of standard rules as set out in the annex to directive 2001 / 86 / ec should apply , mutatis mutandis . in order to protect either the agreed solution or the application of those standard rules , the company should not be able to remove the participation rights through carrying out subsequent domestic or cross - border conversion , merger or division within three years . ### in order to ensure that employee participation is not unduly prejudiced as a result of the cross - border conversion , where the company carrying out the cross - border conversion is operating under an employee participation system in the departure member state , the company should be obliged to take a legal form allowing for the exercise of such equivalent participation , including through the presence of representatives of the employees in the appropriate management or supervisory organ of the company in the destination member state . moreover , in such a case , a bona fide negotiation between the company and its employees should take place in a timely manner ahead of the conversion , along the lines of the procedure provided for in directive 2001 / 86 / ec , with a view to finding an amicable solution reconciling the right of the company to carry out a cross - border conversion with the employees ' rights of participation . as a result of those negotiations , either a bespoke and agreed solution or , in the absence of an agreement , the application of standard rules as set out in the annex to directive 2001 / 86 / ec should apply , mutatis mutandis . in order to protect either the agreed solution or the application of those standard rules , the company should not be able to remove the participation rights through carrying out subsequent domestic or cross - border conversion , merger or division within ten years .


### on the basis of the draft terms of conversion and the reports , the general meeting of the members of the company should decide on whether or not to approve those draft terms . it is important that the majority requirement for such a vote should be sufficiently high in order to ensure that the decision to convert is a collective one . in addition , members should also have the right to vote on any arrangements concerning employee participation , if they have reserved that right during the general meeting . ### on the basis of the draft terms of conversion and the reports , the general meeting of the members of the company should decide on whether or not to approve those draft terms . it is important that the majority requirement for such a vote should be sufficiently high in order to ensure that the decision to convert is a collective one .


### in order to guarantee the appropriate protection of creditors in cases where they are not satisfied with the protection offered by the company in the draft terms of the cross - border division , creditors who are prejudiced by the cross - border division may apply to the competent judicial or administrative authority of the member state of the company being divided for the safeguards they consider adequate . in order to facilitate the assessment of prejudice , certain presumptions should be laid down whereby creditors would be deemed not to be prejudiced by a cross - border division where the risk of loss to a creditor is remote . a presumption should arise where an independent expert report concludes that there is no reasonable likelihood that the creditors would be prejudiced or where creditors are offered a right to payment against the company resulting from the division or against a third party guarantee of equivalent value to the creditor ' s original claim and which can be brought in the same jurisdiction jurisdiction as the original claim . the creditor protection provided for in this directive should be without prejudice to national laws of the member state of the company being divided concerning payment to public bodies , including taxation or social security contributions . ### in order to guarantee the appropriate protection of creditors in cases where they are not satisfied with the protection offered by the company in the draft terms of the cross - border division , creditors who are prejudiced by the cross - border division may apply to the competent judicial or administrative authority of the member state of the company being divided for the safeguards they consider adequate . in order to facilitate the assessment of prejudice , certain presumptions should be laid down whereby creditors would be deemed not to be prejudiced by a cross - border division where the risk of loss to a creditor is remote . a presumption should arise where creditors are offered a right to payment against the company resulting from the division or against a third party guarantee of equivalent value to the creditor ' s original claim and which can be brought in the same jurisdiction as the original claim . the creditor protection provided for in this directive should be without prejudice to national laws of the member state of the company being divided concerning payment to public bodies , including taxation or social security contributions .


### point of part 3 of the annex . ### the annex , with the exclusion of points en of part 3 , instead of which the following will apply as a minimum : the employees of the company , its subsidiaries and establishments and / or the representative body shall have the right to elect and appoint a number of members of the administrative or supervisory body of the converted company equal to two representatives in companies up from 50 employees , one third in companies having from 250 employees to 1000 employees and parity in companies with more than 1000 employees .


### member states shall ensure in order to assess whether the cross - border division constitutes an artificial arrangement within the meaning of article 160d of this directive , the competent authority of the company being divided shall carry out an in - depth assessment of all relevant facts and circumstances and shall take into account at a minimum the following : the characteristics of the establishment in the member states concerned , including the intent , the sector , the investment , the net turnover and profit or loss , number of employees , the composition of the balance sheet , the tax residence , the assets and their location , the habitual place of work of the employees and of specific groups of employees , the place where social contributions are due and the commercial risks assumed by the company being divided in the member state of that company and member states of recipient companies . ### member states shall ensure in order to assess whether the cross - border division constitutes an artificial arrangement within the meaning of article 160d of this directive , the competent authority of the company being divided shall carry out an in - depth assessment of all relevant facts and circumstances and shall take into account at a minimum the following : the characteristics of the establishment in the destination member state , including the intent , the sector , the investment , the net turnover and profit or loss , the number of employees working in the country of destination , the number of employees working in another country grouped according to the country of work , the number of employees posted in the year prior to the conversion within the meanings of regulation no 883 / 2004and directive 96 / 71 / ec , the number of employees working simultaneously in more than one member state within the meaning of regulation no 883 / 2004 , the composition of the balance sheet , the tax residence , the assets and their location , the habitual place of work of the employees and of specific groups of employees , the places where social contributions are due , and the commercial risks assumed by the converted company in the destination member state and the departure member state . , and the composition of the balance sheet and of the financial statement in the destination member state and in all member states in which the company operates in the last two fiscal years .


### these developments in the case - law have opened up new opportunities for companies and firms in the single market in order to foster economic growth , effective competition and productivity . at the same time , the objective of a single market without internal borders for companies must also be reconciled with other objectives of european integration such as social protection , the protection of creditors and the protection of shareholders . such objectives , in the absence of harmonised rules specifically regarding cross - border conversions , are pursued by member states through a number of multifarious legal provisions and administrative practices . as a result , whereas companies are already able to merge cross - border , they experience a number of legal and practical difficulties when wishing to perform a cross - border conversion . moreover , the national legislation of many member states provides for the procedure of domestic conversions without offering an equivalent procedure for converting cross - border . ### these developments in the case - law have opened up new opportunities for companies and firms in the single market in order to foster economic growth , effective competition and productivity . at the same time , in the absence of a level playing field in the form of coherent social and fiscal rules , these developments went hand - in - hand with the proliferation of letterbox companies and abusive practices , constituting artificial arrangements and circumventing fiscal and social security obligations as well as undercutting workers’ rights . the objective of a single market without internal borders for companies must be reconciled with other objectives of european integration such as social protection for all , the protection of workers ' rights , the protection of creditors and the protection of shareholders , as well as the fight against attacks on financial interests of the eu via for example money laundering and tax evasion . in the absence of harmonised rules specifically regarding cross - border conversions , member states have developed a number of multifarious legal provisions and administrative practices . as a result , whereas companies are already able to merge cross - border , they experience a number of legal and practical difficulties when wishing to perform a cross - border conversion . moreover , the national legislation of many member states provides for the procedure of domestic conversions without offering an equivalent procedure for converting cross - border .


### the issue of the pre - division certificate by the member state of the company being divided should be scrutinised to ensure the legality of the cross - border division . the competent authority should decide whether to issue a pre - division certificate within one month of the application by the company has been submitted , unless it has serious concerns as to the existence of an artificial arrangement aimed at obtaining undue tax advantages or at unduly prejudicing the legal or contractual rights of employees , creditors or members . in such a case , the competent authority should carry out an in - depth assessment . however , this in - depth assessment should not be carried out systematically but it should be conducted on a case - by - case basis where there are serious concerns as to the existence of an artificial arrangement . for their assessment , competent authorities should take into account at least a number of factors laid down in this directive which however should be only considered as indicative factors in the overall assessment and not be considered in isolation . in order not to burden companies with an overly lengthy procedure , this in - depth assessment should in any event be concluded within two months informing the company that the in - depth assessment will be carried out . ### the issue of the pre - division certificate by the member state of the company being divided should be scrutinised to ensure the legality of the cross - border division . the competent authority should decide whether to issue a pre - division certificate within one month of the receipt of the report of the independent expert , unless it has serious concerns as to the existence of an artificial arrangement aimed at obtaining undue tax advantages or at unduly prejudicing the legal or contractual rights of employees , creditors or members . in such a case , the competent authority should carry out an in - depth assessment . however , this in - depth assessment should not be carried out systematically but it should be conducted on a case - by - case basis where there are serious concerns as to the existence of an artificial arrangement . for their assessment , competent authorities should take into account at least a number of factors laid down in this directive which however should be only considered as indicative factors in the overall assessment and not be considered in isolation . in order not to burden companies with an overly lengthy procedure , this in - depth assessment should in any event be concluded within five months informing the company that the in - depth assessment will be carried out .


### the right to convert an existing company formed in a member state into a company governed by another member state may in certain circumstances be used for abusive purposes such as for the circumvention of labour standards , social security payments , tax obligations , creditors ' , minority shareholders ' rights or rules on employees participation . in order to combat such possible abuses , a general principle of union law , member states are required to ensure that companies do not use the cross - border conversion procedure in order to create artificial arrangements aimed at obtaining undue tax advantages or at unduly prejudicing the legal or contractual rights of employees , creditors or members . in so far as it constitutes a derogation from a fundamental freedom , the fight against abuses must be interpreted strictly and be based on an individual assessment of all relevant circumstances . a procedural and substantive framework which describes the margin of discretion and allows for the diversity of approach by member states whilst at the same time setting out the requirements to streamline the actions to be taken by national authorities to fight abuses in conformity with union law should be laid down . ### the right to merge , divide or convert an existing company formed in a member state into a company governed by another member state should never be used for abusive purposes such as for the circumvention of labour standards , social security payments , tax obligations , creditors ' , minority shareholders ' rights or rules on employees participation , as this is the case for example of letterbox companies . in order to combat such possible abuses , a general principle of union law , member states are required to ensure that companies do not use the cross - border conversion , merger or division procedure in order to create artificial arrangements aimed , solely or partially , at obtaining tax or social security advantages or at prejudicing the legal or contractual rights of employees , creditors or members . the fight against abuses must be based on an individual assessment of all relevant circumstances . a common procedural and substantive framework which sets out the requirements to streamline the actions to be taken by national authorities to fight abuses in conformity with union law should be laid down , whilst describing , where strictly necessary , the margin of discretion allowed for member states .


### in order to ensure the accuracy of the information contained in the draft terms of division and in the reports addressed to the members and employees and to provide factual elements necessary to assess whether the proposed division constitutes an artificial arrangement which could not be authorised , an independent expert report to assess the division plan should be required to be prepared . in order to secure the independence of the expert , the expert should be appointed by the competent authority , following an application by the company . in this context , the expert report should present all relevant information to enable the competent authority of the member state of the company being divided to take an informed decision as to whether or not to issue the pre - division certificate to this end , the expert should be able to obtain all the relevant company information and documents and carry out all necessary investigations in order to gather all the evidence required . the expert should use information , in particular net turnover and profit or loss , number of employees and the composition of balance sheet collected by the company in view of the preparation of financial statements in accordance with union law and the law of member states . however , in order to protect any confidential information , including business secrets of the company , such information should not form part of the expert’s final report which itself would be publically available . ### in order to ensure the accuracy of the information contained in the draft terms of division and in the reports addressed to the members and employees and to provide factual elements necessary to assess whether the proposed division constitutes an artificial arrangement which could not be authorised , the competent authority should be required to assess the division plan . in this context , the report should present all relevant information to enable the competent authority of the member state of the company being divided to take an informed decision as to whether or not to issue the pre - division certificate . to this end , the competent authority should be able to obtain all the relevant company information and documents and carry out all necessary investigations in order to gather all the evidence required . the competent authority should use information , in particular net turnover and profit or loss , number of employees and the composition of balance sheet collected by the company in view of the preparation of financial statements in accordance with union law and the law of member states . however , in order to protect any confidential information , including business secrets of the company , such information should not be made publically available , but should nevertheless be at the disposal , under confidentiality requirements , to the competent authority and where applicable under national law , to employee representatives .


### in order to ensure that employee participation is not unduly prejudiced as a result of the cross - border conversion , where the company carrying out the cross - border conversion is operating under an employee participation system in the departure member state , the company should be obliged to take a legal form allowing for the exercise of such participation , including through the presence of representatives of the employees in the appropriate management or supervisory organ of the company in the destination member state . moreover , in such a case , a bona fide negotiation between the company and its employees should take place , along the lines of the procedure provided for in directive 2001 / 86 / ec , with a view to finding an amicable solution reconciling the right of the company to carry out a cross - border conversion with the employees ' rights of participation . as a result of those negotiations , either a bespoke and agreed solution or , in the absence of an agreement , the application of standard rules as set out in the annex to directive 2001 / 86 / ec should apply , mutatis mutandis . in order to protect either the agreed solution or the application of those standard rules , the company should not be able to remove the participation rights through carrying out subsequent domestic or cross - border conversion , merger or division within three years . ### in order to ensure that employee participation is not prejudiced as a result of the cross - border conversion , where the company carrying out the cross - border conversion is operating under an employee participation system in the departure member state , the company should be obliged to take a legal form allowing for the exercise of such participation , including through the presence of representatives of the employees in the appropriate management or supervisory organ of the company in the destination member state . moreover , in such a case , a bona fide negotiation between the company and its employees should take place , along the lines of the procedure provided for in directive2001 / 86 / ec , with a view to finding an amicable solution to ensure the employees ' rights of information , consultation and participation . the agreement should ensure that at least the same level of all elements of employee involvement as applicable in the company before the conversion , continues to apply . as a result of those negotiations , either a bespoke and agreed solution or , in the absence of an agreement , the application of standard rules should apply , mutatis mutandis . in order to protect either the agreed solution or the application of those standard rules , the company should not be able to remove the information , consultation and participation rights through carrying out subsequent domestic or cross - border conversion , merger or division within ten years .


### member states shall ensure in order to assess whether the cross - border conversion constitutes an artificial arrangement within the meaning of article 86c , that the competent authority of the departure member state carries out an in - depth assessment of all relevant facts and circumstances and shall take into account at a minimum the following : the characteristics of the establishment in the destination member state , including the intent , the sector , the investment , the net turnover and profit or loss , number of employees , the composition of the balance sheet , the tax residence , the assets and their location , the habitual place of work of the employees and of specific groups of employees , the place where social contributions are due and the commercial risks assumed by the converted company in the destination member state and the departure member state . ### member states shall ensure in order to assess whether the cross - border conversion constitutes an artificial arrangement , that the competent authority of the departure member state carries out an in - depth assessment of all relevant facts and circumstances and shall take into account at a minimum the following : the characteristics of the establishment in the destination member state , including the intent , the sector , the investment , the net turnover and profit or loss , the number of employees working in the country of destination , the number of employees working in another country grouped according to the country of work , the number of employees posted in the year prior to the conversion within the meanings of regulation no 883 / 2004and directive 96 / 71 / ec , the number of employees working simultaneously in more than one member state within the meaning of regulation no 883 / 2004 , the composition of the balance sheet , the tax residence , the assets and their location , the habitual place of work of the employees and of specific groups of employees , the places where social contributions are due , and the commercial risks assumed by the converted company in the destination member state and the departure member state . , and the composition of the balance sheet and of the financial statement in the destination member state and in all member states in which the company operates in the last two fiscal years .


### the competent authority shall appoint an independent expert within five working days of the application referred to in paragraph 1 and the receipt of the draft terms and reports . the expert shall be independent from the company being divided and may be a natural or a legal person depending upon the law of the member state concerned . member states shall take into account , in assessing the independence of the expert , the framework established in articles 22 and 22b of directive 2006 / 43 / ec . ### the competent authority shall appoint two independent experts within one month from the application referred to in paragraph 1 and the receipt of the draft terms and reports . the experts shall be appointed on the basis of a pre - selected list that was specifically established for the purpose of assessing cross - border divisions . the list shall include natural persons on the basis of their personal expertise . the fields of expertise to be reflected in the list should include at least company law , taxation and fiscal law , social security and workers’ rights . together , the two independent experts shall cover all of the fields of expertise mentioned in this paragraph . an expert may operate on his or her own behalf or on behalf of a legal person . member states shall define fixed rates for the fees paid to the independent experts , which shall be paid by the company applying for the division . the experts shall be independent from the company carrying out the cross - border division . member states shall take into account , in assessing the independence of the experts , the framework established in articles 22 to 22b of directive 2006 / 43 / ec . in addition : the experts or the legal person on whose behalf he or she is operating , shall not have performed work , in whatever capacity , for the company applying for the conversion in the five years prior to his or her appointment or vice versa ; and the two experts appointed shall not operate on behalf of the same legal person .


### the lack of harmonisation of safeguards for members or creditors has been identified an obstacle for cross - border mergers by different stakeholders . members and creditors should be offered the same level of protection regardless of the member states in which the merging companies are situated . this is without prejudice to the member states’ rules on protecting creditors or shareholders which are outside the scope of the harmonised measures , such as transparency requirements . ### the lack of harmonisation of safeguards for employees , members or creditors has been identified an obstacle for cross - border mergers by different stakeholders . employees , members and creditors should be offered at least the same level of protection regardless of the member states in which the merging companies are situated . this is without prejudice to the member states’ rules on protecting employees , creditors or shareholders which are outside the scope of the harmonised measures , such as transparency requirements .


### member states shall ensure that the company being divided applies to the competent authority , designated in accordance with article 160o , not less than two months before the date of the general meeting referred to in article 160k , to appoint an expert to examine and assess the draft terms of cross - border division and the reports referred to in articles 160g and 160h , subject to the proviso set out in paragraph 6 of this article . ### member states shall ensure that the company being divided applies to the competent authority , designated in accordance with article 160o , not less than two months before the date of the general meeting referred to in article 160k . the competent authority shall examine and assess the draft terms of cross - border division and the reports referred to in article 160g , subject to the proviso set out in paragraph 6 of this article .


### the issue of the pre - division certificate by the member state of the company being divided should be scrutinised to ensure the legality of the cross - border division . the competent authority should decide whether to issue a pre - division certificate within one month of the application by the company has been submitted , unless it has serious concerns as to the existence of an artificial arrangement aimed at obtaining undue tax advantages or at unduly prejudicing the legal or contractual rights of employees , creditors or members . in such a case , the competent authority should carry out an in - depth assessment . however , this in - depth assessment should not be carried out systematically but it should be conducted on a case - by - case basis where there are serious concerns as to the existence of an artificial arrangement . for their assessment , competent authorities should take into account at least a number of factors laid down in this directive which however should be only considered as indicative factors in the overall assessment and not be considered in isolation . in order not to burden companies with an overly lengthy procedure , this in - depth assessment should in any event be concluded within two months informing the company that the in - depth assessment will be carried out . ### the issue of the pre - division certificate by the member state of the company being divided should be scrutinised to ensure the legality of the cross - border division . the competent authority should decide whether to issue a pre - division certificate within one month of the date of receipt of the report by the independent expert , unless it has serious concerns as to the existence of an artificial arrangement . in such a case , the competent authority should carry out an in - depth assessment . however , this in - depth assessment should not be carried out systematically but it should be conducted on a case - by - case basis where there are serious concerns as to the existence of an artificial arrangement . for their assessment , competent authorities should take into account at least a number of factors laid down in this directive which however should be only considered as indicative factors in the overall assessment and not be considered in isolation . in order not to burden companies with an overly lengthy procedure , this in - depth assessment should in any event be concluded within five months informing the company that the in - depth assessment will be carried out .


### these developments in the case - law have opened up new opportunities for companies and firms in the single market in order to foster economic growth , effective competition and productivity . at the same time , the objective of a single market without internal borders for companies must also be reconciled with other objectives of european integration such as social protection , the protection of creditors and the protection of shareholders . such objectives , in the absence of harmonised rules specifically regarding cross - border conversions , are pursued by member states through a number of multifarious legal provisions and administrative practices . as a result , whereas companies are already able to merge cross - border , they experience a number of legal and practical difficulties when wishing to perform a cross - border conversion . moreover , the national legislation of many member states provides for the procedure of domestic conversions without offering an equivalent procedure for converting cross - border . ### these developments in the case - law have opened up new opportunities for companies and firms in the single market in order to foster economic growth , effective competition and productivity . at the same time , in the absence of a level playing field in the form of coherent social and fiscal rules , these developments went hand - in - hand with the proliferation of letterbox companies and abusive practices , constituting artificial arrangements and circumventing fiscal and social security obligations as well as undercutting workers’ rights . the objective of a single market without internal borders for companies must be reconciled with other objectives of european integration such as social protection for all , the protection of workers’ rights , the protection of creditors and the protection of shareholders , as well as the fight against attacks on financial interests of the union via for example money laundering and tax evasion . in the absence of harmonised rules specifically regarding cross - border conversions , member states have developed a number of multifarious legal provisions and administrative practices . as a result , whereas companies are already able to merge cross - border , they experience a number of legal and practical difficulties when wishing to perform a cross - border conversion . moreover , the national legislation of many member states provides for the procedure of domestic conversions without offering an equivalent procedure for converting cross - border .


### the evaluation of the implementation of the cross - border merger rules in member states has shown that the number of cross - border mergers in the union has significantly increased . however , this evaluation has also revealed certain shortcomings in relation specifically to creditor protection and shareholder protection as well as to the lack of simplified procedures which impede the full effectiveness and efficiency of those cross - border merger rules . ### the evaluation of the implementation of the cross - border merger rules in member states has shown that the number of cross - border mergers in the union has significantly increased . however , this evaluation has also revealed certain shortcomings in relation specifically to employee , creditor and shareholder protection as well as to the lack of simplified procedures which impede the full effectiveness and efficiency of those cross - border merger rules . while no available data could conclusively establish that the employee participation procedure was inefficient , the evaluation revealed that companies considered it too complex and leading to unnecessary costs and delays within the merger .


### a description of all factual elements necessary for the competent authority designated in accordance with article 160o , to carry out an in - depth assessment to determine whether the intended cross - border division constitutes an artificial arrangement in accordance with article 160p , at a minimum the following : the characteristics of the establishments in the member states concerned of the recipient companies , including the intent , the sector , the investment , the net turnover and profit or loss , number of employees , the composition of the balance sheet , the tax residence , the assets and their location , the habitual place of work of the employees and of specific groups of employees , the place where social contributions are due and the commercial risks assumed by the company being divided in the member states of the recipient companies . ### a description of all factual elements necessary for the competent authority designated in accordance with article 160o , to carry out an in - depth assessment to determine whether the intended cross - border division constitutes an artificial arrangement in accordance with article 160p , at a minimum the following : the characteristics of the establishment in the destination member state , including the intent , the sector , the investment , the net turnover and profit or loss , the number of employees working in the country of destination , the number of employees working in another country grouped according to the country of work , the number of employees posted or sent in the year prior to the conversion within the meanings of regulation no 883 / 2004 and directive 96 / 71 / ec , the number of employees working simultaneously in more than one member state within the meaning of regulation no 883 / 2004 , the tax residence , the assets and their location , the habitual place of work of the employees and of specific groups of employees , the places where social contributions are due ; the commercial risks assumed by the converted company in the destination member state and the departure member state , the composition of the balance sheet and of the financial statement in the destination member state and in all member states in which the company operates in the last two fiscal years .


### in respect of compliance with the rules concerning employee participation as laid down in article 86l , the departure member state shall verify that the draft terms of cross - border conversion , referred to in paragraph 2 of this article , include information on the procedures by which the relevant arrangements are determined and on the possible options for such arrangements . ### in respect of compliance with the rules concerning employee participation as laid down in article 86l , the departure member state shall verify that the draft terms and reports of cross - border conversion , referred to in paragraph 2 of this article , include information on the procedures by which the relevant arrangements are determined and on the possible options for such arrangements .


### a description of all factual elements necessary for the competent authority , designated in accordance with article 86m , to carry out an in - depth assessment to determine whether the intended cross - border conversion constitutes an artificial arrangement in accordance with article 86n , including at a minimum the following : the characteristics of the establishment in the destination member state , including the intent , the sector , the investment , the net turnover and profit or loss , number of employees , the composition of the balance sheet , the tax residence , the assets and their location , the habitual place of work of the employees and of specific groups of employees , the place where social contributions are due and the commercial risks assumed by the converted company in the destination member state and the departure member state . ### a description of all factual elements necessary for the competent authority , designated in accordance with article 86m , to carry out an in - depth assessment to determine whether the intended cross - border conversion constitutes an artificial arrangement in accordance with article 86n , including at a minimum the following : the characteristics of the establishment in the destination member state , including the intent , the sector , the investment , the net turnover and profit or loss , the number of employees working in the country of destination , the number of employees working in another country grouped according to the country of work , the number of employees posted or sent in the year prior to the conversion within the meanings of regulation no 883 / 2004 and directive96 / 71 / ec , the number of employees working simultaneously in more than one member state within the meaning of regulation no 883 / 2004 , the tax residence , the assets and their location , the habitual place of work of the employees and of specific groups of employees , the places where social contributions are due ; the commercial risks assumed by the converted company in the destination member state and the departure member state the composition of the balance sheet and of the financial statement in the destination member state and in all member states in which the company operates in the last two fiscal years .


### the application for the appointment of an expert shall be accompanied by the following : ### the application to the competent authority shall be accompanied by the following :


### in order to ensure that employee participation is not unduly prejudiced as a result of the cross - border division where the company carrying out the cross - border division is operating under an employee participation system , the companies resulting from the division should be obliged to take a legal form allowing for the exercise of participation , including through the presence of representatives of the employees in the appropriate management or supervisory organs of the companies . moreover , in such a case , a bona fide negotiation between the company and its employees should take place , along the lines of the procedure provided for in directive 2001 / 86 / ec , with a view to finding an amicable solution reconciling the right of the company to carry out a cross - border division with the employees ' ' rights of participation . as a result of those negotiations , either a bespoke and agreed solution or , in the absence of an agreement , the application of standard rules as set out in the annex to directive 2001 / 86 / ec should apply mutatis mutandis . in order to protect either the agreed solution or the application of those standard rules , the company should not be able to remove the participation rights through carrying out subsequent domestic or cross - border conversions , mergers or divisions within 3 years . ### in order to ensure that employee participation is not prejudiced as a result of the cross - border division where the company carrying out the cross - border division is operating under an employee participation system , the companies resulting from the division should be obliged to take a legal form allowing for the exercise of participation , including through the presence of representatives of the employees in the appropriate management or supervisory organs of the companies . moreover , in such a case , a bona fide negotiation between the company and its employees should take place , along the lines of the procedure provided for in directive 2001 / 86 / ec , with a view to finding an amicable solution reconciling the right of the company to carry out a cross - border division with the employees ' ' rights of information , consultation and participation . the agreement should ensure that at least the same level of all elements of employee involvement as applicable in the company before the conversion , continues to apply . as a result of those negotiations , either a bespoke and agreed solution or , in the absence of an agreement , the application of standard rules should apply mutatis mutandis . in order to protect either the agreed solution or the application of those standard rules , the company should not be able to remove the information , consultation and participation rights through carrying out subsequent domestic or cross - border conversions , mergers or divisions within 10 years .


### in order to prevent the circumvention of the employee participation rights by means of a cross - border division , the company carrying out a division which is registered in the member state which provides for the employee participation rights , should not be able to perform a cross - border division without first entering into negotiations with its employees or their representatives when the average number of employees employed by that company is equivalent to four fifths of the national threshold for triggering such employee participation . ### in order to prevent the circumvention of the employee participation rights by means of a cross - border division , the company carrying out a division which is registered in the member state which provides for the employee participation rights , should not be able to perform a cross - border division without first entering into negotiations with its employees or their representatives .


### the reports referred to in articles 86e , 86f and 86g , as appropriate ; ### the reports referred to in articles 86e , 86f and 86g , as appropriate , and including the employees’ opinion and response of the management referred to in article 86f paragraphs 4 and 4a ;


### the right to convert an existing company formed in a member state into a company governed by another member state may in certain circumstances be used for abusive purposes such as for the circumvention of labour standards , social security payments , tax obligations , creditors ' , minority shareholders ' rights or rules on employees participation . in order to combat such possible abuses , a general principle of union law , member states are required to ensure that companies do not use the cross - border conversion procedure in order to create artificial arrangements aimed at obtaining undue tax advantages or at unduly prejudicing the legal or contractual rights of employees , creditors or members . in so far as it constitutes a derogation from a fundamental freedom , the fight against abuses must be interpreted strictly and be based on an individual assessment of all relevant circumstances . a procedural and substantive framework which describes the margin of discretion and allows for the diversity of approach by member states whilst at the same time setting out the requirements to streamline the actions to be taken by national authorities to fight abuses in conformity with union law should be laid down . ### the right to merge , divide or convert an existing company formed in a member state into a company governed by another member state should never be used for abusive purposes such as for the circumvention of labour standards , social security payments , tax obligations , creditors ' , minority shareholders ' rights or rules on employees participation , as this is the case for example of letterbox companies . in order to combat such possible abuses , a general principle of union law , member states are required to ensure that companies do not use the cross - border conversion , merger or division procedure in order to create artificial arrangements aimed , solely or partially , at obtaining tax or social security advantages or at prejudicing the legal or contractual rights of employees , creditors or members . the fight against abuses must be based on an individual assessment of all relevant circumstances . a common procedural and substantive framework which sets out the requirements to streamline the actions to be taken by national authorities to fight abuses in conformity with union law should be laid down , whilst describing , where strictly necessary , the margin of discretion allowed for member states .


### the provisions of this directive do not affect the legal or administrative provisions , including the enforcement of tax rules in cross - border conversions , mergers and divisions , of national law relating to the taxes of member states , or its territorial and administrative subdivisions . ### the provisions of this directive do not affect the legal or administrative provisions , including the enforcement of tax rules in cross - border conversions , mergers and divisions , of national law relating to the taxes of member states , or its territorial and administrative subdivisions . departure member states shall for example have the right to impose taxes on hidden reserves of departing companies that have not yet been subject to taxation in the departing member state , in accordance with the case law of the european court of justice .


### in order to further enhance the existing cross - border merger procedure , it is necessary to simplify those merger rules , where appropriate , whilst at the same time ensuring that stakeholders , and in particular employees , are adequately protected . therefore , the existing cross - border merger rules should be modified in order to oblige the management or administrative organs of the merging companies to prepare separate reports detailing the legal and economic aspects of the cross - border merger for both members and for employees . the obligation on the management or administrative organ of the company to prepare the report for the members may however be waived , where those members are already informed about legal and economic aspects of the proposed merger . however , the report prepared for employees may only be waived where the merging companies and their subsidiaries do not have any employees other than those who form part of the management or administrative organ . ### in order to further enhance the existing cross - border merger procedure , it is necessary to simplify those merger rules , where appropriate , whilst at the same time ensuring that stakeholders , and in particular employees , are adequately protected . therefore , the existing cross - border merger rules should be modified in order to oblige the management or administrative organs of the merging companies to prepare a separate report detailing the legal and economic aspects as well as the rationale for the cross - border merger for both members and for employees .


### member states shall ensure in order to assess whether the cross - border conversion constitutes an artificial arrangement within the meaning of article 86c , that the competent authority of the departure member state carries out an in - depth assessment of all relevant facts and circumstances and shall take into account at a minimum the following : the characteristics of the establishment in the destination member state , including the intent , the sector , the investment , the net turnover and profit or loss , number of employees , the composition of the balance sheet , the tax residence , the assets and their location , the habitual place of work of the employees and of specific groups of employees , the place where social contributions are due and the commercial risks assumed by the converted company in the destination member state and the departure member state . ### member states shall ensure in order to assess whether the cross - border conversion constitutes an artificial arrangement , that the competent authority of the departure member state carries out an in - depth assessment of all relevant facts and circumstances and shall take into account at a minimum the following : the characteristics of the establishment in the destination member state , including the sector , the investment , the net turnover and profit or loss , number of employees , the composition of the balance sheet , the tax residence , the assets and their location , the habitual place of work of the employees and of specific groups of employees , the place where social contributions are due and the commercial risks assumed by the converted company in the destination member state and the departure member state .


### in order to prevent the circumvention of employee participation rights by means of a cross - border conversion , the company carrying out a conversion which is registered in the member state which provides for the employee participation rights , should not be able to perform a cross - border conversion without first entering into negotiations with its employees or their representatives when the average number of employees employed by that company is equivalent to four fifths of the national threshold for triggering such employee participation . ### in order to prevent the circumvention of employee participation rights by means of a cross - border conversion , the company carrying out a conversion which is registered in the member state which provides for the employee participation rights , should not be able to perform a cross - border conversion without first entering into negotiations with its employees or their representatives when the average number of employees employed by that company is at least equivalent to four fifths of the national threshold for triggering such employee participation .


### the competent authority shall appoint an independent expert within five working days of the application referred to in paragraph 1 and the receipt of the draft terms and reports . the expert shall be independent from the company being divided and may be a natural or a legal person depending upon the law of the member state concerned . member states shall take into account , in assessing the independence of the expert , the framework established in articles 22 and 22b of directive 2006 / 43 / ec . ### the competent authority shall start working on the application referred to in paragraph 1 within ten working days following the receipt of the draft terms and report .


### the competent authority shall appoint an independent expert within five working days of the application referred to in paragraph 1 and the receipt of the draft terms and reports . the expert shall be independent from the company being divided and may be a natural or a legal person depending upon the law of the member state concerned . member states shall take into account , in assessing the independence of the expert , the framework established in articles 22 and 22b of directive 2006 / 43 / ec . ### the competent authority shall appoint two independent experts within one month from the application referred to in paragraph 1 and the receipt of the draft terms and reports . the experts shall be appointed on the basis of a pre - selected list that was specifically established for the purpose of assessing cross - border divisions . the list shall include natural persons on the basis of their personal expertise . the fields of expertise to be reflected in the list should include at least company law , taxation and fiscal law , social security and workers’ rights . together , the two independent experts shall cover all of the fields of expertise mentioned in this paragraph . an expert may operate on his or her own behalf or on behalf of a legal person . member states shall define fixed rates for the fees paid to the independent experts , which shall be paid by the company applying for the division . the experts shall be independent from the company carrying out the cross - border division . member states shall take into account , in assessing the independence of the experts , the framework established in articles 22 to 22b of directive 2006 / 43 / ec . in addition : the experts or the legal person on whose behalf he or she is operating , shall not have performed work , in whatever capacity , for the company applying for the conversion in the five years prior to his or her appointment or vice versa ; and the two experts appointed shall not operate on behalf of the same legal person .


### the likely repercussions of the cross - border division on employment ; ### the likely repercussions of the cross - border division on employment , wage development and company level social dialogue including board level representation of employee representatives ;


### member states shall ensure in order to assess whether the cross - border conversion constitutes an artificial arrangement within the meaning of article 86c , that the competent authority of the departure member state carries out an in - depth assessment of all relevant facts and circumstances and shall take into account at a minimum the following : the characteristics of the establishment in the destination member state , including the intent , the sector , the investment , the net turnover and profit or loss , number of employees , the composition of the balance sheet , the tax residence , the assets and their location , the habitual place of work of the employees and of specific groups of employees , the place where social contributions are due and the commercial risks assumed by the converted company in the destination member state and the departure member state . ### member states shall ensure in order to assess whether the cross - border conversion constitutes an artificial arrangement , that the competent authority of the departure member state carries out an in - depth assessment of all relevant facts and circumstances and shall take into account at a minimum the following : the characteristics of the establishment in the destination member state , including the intent , the sector , the investment , the net turnover and profit or loss , the number of employees working in the country of destination , the number of employees working in another country grouped according to the country of work , the number of employees posted in the year prior to the conversion within the meanings of regulation no 883 / 2004and directive 96 / 71 / ec , the number of employees working simultaneously in more than one member state within the meaning of regulation no 883 / 2004 , the composition of the balance sheet , the tax residence , the assets and their location , the habitual place of work of the employees and of specific groups of employees , the places where social contributions are due , and the commercial risks assumed by the converted company in the destination member state and the departure member state . , and the composition of the balance sheet and of the financial statement in the destination member state and in all member states in which the company operates in the last two fiscal years .


### the lack of harmonisation of safeguards for members or creditors has been identified an obstacle for cross - border mergers by different stakeholders . members and creditors should be offered the same level of protection regardless of the member states in which the merging companies are situated . this is without prejudice to the member states’ rules on protecting creditors or shareholders which are outside the scope of the harmonised measures , such as transparency requirements . ### the lack of harmonisation of safeguards for employees , members or creditors has been identified an obstacle for cross - border mergers by different stakeholders . employees , members and creditors should be offered at least the same level of protection regardless of the member states in which the merging companies are situated . this is without prejudice to the member states’ rules on protecting employees , creditors or shareholders which are outside the scope of the harmonised measures , such as transparency requirements .


### a description of all factual elements necessary for the competent authority designated in accordance with article 160o , to carry out an in - depth assessment to determine whether the intended cross - border division constitutes an artificial arrangement in accordance with article 160p , at a minimum the following : the characteristics of the establishments in the member states concerned of the recipient companies , including the intent , the sector , the investment , the net turnover and profit or loss , number of employees , the composition of the balance sheet , the tax residence , the assets and their location , the habitual place of work of the employees and of specific groups of employees , the place where social contributions are due and the commercial risks assumed by the company being divided in the member states of the recipient companies . ### a description of all factual elements necessary for the competent authority designated in accordance with article 160o , to carry out an in - depth assessment to determine whether the intended cross - border division constitutes an artificial arrangement in accordance with article 160p , at a minimum the following : the characteristics of the establishment in the destination member state , including the intent , the sector , the investment , the net turnover and profit or loss , the number of employees working in the country of destination , the number of employees working in another country grouped according to the country of work , the number of employees posted or sent in the year prior to the conversion within the meanings of regulation no 883 / 2004 and directive 96 / 71 / ec , the number of employees working simultaneously in more than one member state within the meaning of regulation no 883 / 2004 , the tax residence , the assets and their location , the habitual place of work of the employees and of specific groups of employees , the places where social contributions are due ; the commercial risks assumed by the converted company in the destination member state and the departure member state , the composition of the balance sheet and of the financial statement in the destination member state and in all member states in which the company operates in the last two fiscal years .


### member states shall ensure that where the competent authority referred to in paragraph 1 of this article decides to carry out an in - depth assessment , it is able to hear the company and all parties that have submitted observations pursuant article 160j in accordance with national law . the competent authorities referred to in paragraph 1 may also hear any other interested third parties in accordance with national law . the competent authority shall take its final decision regarding the issue of the pre - division certificate within two months from the start of the in - depth assessment . ### member states shall ensure that where the competent authority referred to in paragraph 1 of this article decides to carry out an in - depth assessment , it is able to hear the company and all parties that have submitted observations pursuant article 160j in accordance with national law . the competent authorities referred to in paragraph 1 may also hear any other interested third parties in accordance with national law . the competent authority shall take its final decision regarding the issue of the pre - division certificate within five months from the start of the in - depth assessment .


### these developments in the case - law have opened up new opportunities for companies and firms in the single market in order to foster economic growth , effective competition and productivity . at the same time , the objective of a single market without internal borders for companies must also be reconciled with other objectives of european integration such as social protection , the protection of creditors and the protection of shareholders . such objectives , in the absence of harmonised rules specifically regarding cross - border conversions , are pursued by member states through a number of multifarious legal provisions and administrative practices . as a result , whereas companies are already able to merge cross - border , they experience a number of legal and practical difficulties when wishing to perform a cross - border conversion . moreover , the national legislation of many member states provides for the procedure of domestic conversions without offering an equivalent procedure for converting cross - border . ### these developments in the case - law have opened up new opportunities for companies and firms in the single market in order to foster economic growth , effective competition and productivity . at the same time , in the absence of a level playing field in the form of coherent social and fiscal rules , these developments went hand - in - hand with the proliferation of letterbox companies and abusive practices , constituting artificial arrangements and circumventing fiscal and social security obligations as well as undercutting workers’ rights . the objective of a single market without internal borders for companies must be reconciled with other objectives of european integration such as social protection for all , the protection of workers’ rights , the protection of creditors and the protection of shareholders , as well as the fight against attacks on financial interests of the union via for example money laundering and tax evasion . in the absence of harmonised rules specifically regarding cross - border conversions , member states have developed a number of multifarious legal provisions and administrative practices . as a result , whereas companies are already able to merge cross - border , they experience a number of legal and practical difficulties when wishing to perform a cross - border conversion . moreover , the national legislation of many member states provides for the procedure of domestic conversions without offering an equivalent procedure for converting cross - border .


### the application for the appointment of an expert shall be accompanied by the following ### the application to the competent authority shall be accompanied by the following


### the independent expert report referred to in article 160i , where applicable ; ### the report from the competent authority referred to in article 160i , ;


### beneficiaries of international protection as defined in article 2 of directive 2011 / 95 / eu of the european parliament and of the council34 have a wide set of rights including labour market access in the member state having granted them protection . in order to further promote social inclusion of these persons and enhance their labour market opportunities across the union , those who are highly skilled should be entitled to apply for an eu blue card . they should be subject to the same rules as any other third - country national falling within the scope of this directive , while holding the statuses of beneficiary of international protection and eu blue card holder in parallel . however , for reasons of legal clarity and coherence , the provisions on equal treatment and family reunification of this directive should not apply to this group of eu blue card holders in the member state which granted them international protection . those rights should remain regulated under the asylum acquis and , where applicable , council directive 2003 / 86 / ec35 . _________________ 34 directive 2011 / 95 / eu of the european parliament and of the council of 13 december 2011 on standards for the qualification of third - country nationals or stateless persons as beneficiaries of international protection , for a uniform status for refugees or for persons eligible for subsidiary protection , and for the content of the protection granted . 35 council directive 2003 / 86 / ec of 22 september 2003 on the right to family reunification . ### beneficiaries of international protection as defined in article 2 of directive 2011 / 95 / eu of the european parliament and of the council34 and applicants for international protection have a wide set of rights including labour market access in the member state having granted them protection or responsible for determining their application for international protection . in order to further promote social inclusion of these persons and enhance their labour market opportunities across the union , those who are highly skilled should be entitled to apply for an eu blue card . they should be subject to the same rules as any other third - country national falling within the scope of this directive , while holding the statuses of beneficiary of international protection or of applicants for international protection and eu blue card holder in parallel . the rights of refugees and asylum applicants who are also holders of an eu blue card should remain regulated under the asylum acquis and , where applicable , council directive 2003 / 86 / ec35and more favourable provisions covered by the eu blue card in terms of equal treatment , family reunification and mobility should equally apply . _________________ 34 directive 2011 / 95 / eu of the european parliament and of the council of 13 december 2011 on standards for the qualification of third - country nationals or stateless persons as beneficiaries of international protection , for a uniform status for refugees or for persons eligible for subsidiary protection , and for the content of the protection granted . 35 council directive 2003 / 86 / ec of 22 september 2003 on the right to family reunification .


### this directive should not affect the right of the member states to determine the volumes of admission of third - country nationals coming from third countries to their territory in order to seek work in accordance with article 79 of the treaty . on that basis , member states should be able to either consider an application for an eu blue card inadmissible or reject it . as article 79 tfeu only refers to third - country nationals coming from third countries , the right to determine volumes of admission does not apply in situations where a third - country national has already been admitted in the territory of member states under this directive and is seeking to continue the period of residence in the same or a second member state . ### this directive should not affect the right of the member states to determine the volumes of admission of third - country nationals coming from third countries to their territory in order to seek work in accordance with article 79 of the treaty . as article 79 tfeu only refers to third - country nationals coming from third countries , the right to determine volumes of admission does not apply in situations where a third - country national has already been admitted in the territory of member states under this directive and is seeking to continue the period of residence in the same or a second member state .


### “business activity” means a temporary activity related to the business interests of the employer , such as attending internal and external business meetings , attending conferences and seminars , negotiating business deals , undertaking sales or marketing activities , performing internal or client audits , exploring business opportunities , or attending and receiving training ; ### “business activity” means a temporary activity related to the business interests of the employer , such as , but not limited to , attending internal and external business meetings , attending conferences and seminars , negotiating business deals , undertaking sales or marketing activities , performing internal or client audits , exploring business opportunities , or attending and receiving training ;


### the rights acquired by a beneficiary of international protection as an eu blue card holder should be without prejudice to rights enjoyed by the person concerned under directive 2011 / 95 / eu and under the geneva convention in the member state which granted the protection status . in that member state , in order to avoid situations of conflicting rules , the provisions on equal treatment and family reunification of this directive should not apply . persons who are beneficiaries of international protection in one member state and eu blue card holders in another should enjoy the same rights including equality of treatment with nationals of the member state of residence as any other eu blue card holders in the latter member state . ### the rights acquired by a beneficiary of international protection as an eu blue card holder should be without prejudice to rights enjoyed by the person concerned under directive 2011 / 95 / eu and under the geneva convention in the member state which granted the protection status . in that member state , in order to avoid situations of conflicting rules , existing more favourable provisions on equal treatment and family reunification of this directive should apply . persons who are beneficiaries of international protection in one member state and eu blue card holders in another should enjoy the same rights including equality of treatment with nationals of the member state of residence as any other eu blue card holders in the latter member state .


### member states shall set a standard period of validity for the eu blue card , which shall be at least 24 months . if the work contract covers a shorter period , the eu blue card shall be issued at least for the duration of the work contract plus three months . where an eu blue card is renewed , its period of validity shall be at least 24 months . ### member states shall set a standard period of validity for the eu blue card , which shall be at least 36 months . if the work contract covers a shorter period , the eu blue card shall be issued at least for the duration of the work contract plus three months . where an eu blue card is renewed , its period of validity shall be at least 36 months .


### member states should reject applications for an eu blue card and be allowed to withdraw or refuse to renew an eu blue card if there is a threat to public policy , public security or public health . any rejection on grounds of public policy or public security should be based on the individual behaviour of the person concerned , in accordance with the principle of proportionality . illness or disability suffered after the third - country national was admitted to the territory of the first member state should not constitute the sole ground for withdrawing or refusing to renew an eu blue card or for not issuing an eu blue card in a second member state . ### member states should be entitled to reject applications for an eu blue card and be allowed to withdraw or refuse to renew an eu blue card if there is a proven threat to public security . any rejection on grounds of public security should be based on the individual behaviour of the person concerned , in accordance with the principle of proportionality .


### the employer has failed to meet its legal obligations regarding social security , taxation , labour rights or working conditions ; ### where the employer has repeatedly failed to meet its legal obligations regarding social security , taxation , labour rights or working conditions within a period of five years prior to the date of the application ;


### the concept of highly skilled worker should replace the concept of highly qualified worker in order to emphasise that both formal educational qualifications and equivalent professional experience should be taken equally into account as criteria for admission . according to a council recommendation of 20 december 201232 , the validation of learning outcomes , namely competences 33 acquired through non - formal and informal learning can play an important role in enhancing employability and mobility . it recommends member states to have in place , no later than 2018 , arrangements for the validation of non - formal and informal learning . as mechanisms and arrangements for the evaluation and validation of professional experience are not readily available in all member states , an additional transposition period of two years after the entry into force of this directive should be provided for the provisions related to recognising professional experience in order to enable member states , where necessary , to develop such mechanisms and arrangements . member states’ national contact points on the eu blue card should be involved in effective cooperation with stakeholders and networks in the education , training , employment and youth sectors , as well as other relevant policy areas , for the purpose of recognising professional experience under this directive . _________________ 32 council recommendation of 20 december 2012 on the validation of non - formal and informal learning . 33 recommendation of the european parliament and of the council of 18 december 2006 on key competences for lifelong learning . ### the concept of highly skilled worker should replace the concept of highly qualified worker in order to emphasise that both formal educational qualifications and equivalent professional experience should be taken equally into account as criteria for admission . in addition , it should be taken into account that highly talented people with specific skills , who are recognised as highly skilled in their respective sector on the basis of testimonies of their teachers , trainers , portfolio or reputation or who have acquired professional recognition , should also be included in the concept of highly skilled worker . according to a council recommendation of 20 december 201232 , the validation of learning outcomes , namely competences 33 acquired through non - formal and informal learning can play an important role in enhancing employability and mobility . it recommends member states to have in place , no later than 2018 , arrangements for the validation of non - formal and informal learning . as mechanisms and arrangements for the evaluation and validation of professional experience are not readily available in all member states , an additional transposition period of two years after the entry into force of this directive should be provided for the provisions related to recognising professional experience in order to enable member states , where necessary , to develop such mechanisms and arrangements . member states’ national contact points on the eu blue card should be involved in effective cooperation with stakeholders and networks in the education , training , employment and youth sectors , as well as other relevant policy areas , for the purpose of recognising professional experience under this directive . _________________ 32 council recommendation of 20 december 2012 on the validation of non - formal and informal learning . 33 recommendation of the european parliament and of the council of 18 december 2006 on key competences for lifelong learning .


### member states should be allowed to withdraw or refuse to renew an eu blue card where the eu blue card holder has either failed to comply with the conditions for mobility under this directive or has repetitively exercised the mobility rights in an abusive manner , for example by applying for eu blue cards in second member states and beginning employment immediately while it is clear that the conditions will not be fulfilled and the application will be refused . ### member states should be allowed to withdraw or refuse to renew an eu blue card where the eu blue card holder has failed to comply with the conditions for mobility under this directive .


### the documents were fraudulently acquired , or falsified or tampered with ; ### the documents were fraudulently acquired , or falsified or tampered with , with the knowledge of the owner ;


### an eu - wide admission system to attract and retain highly skilled workers into the union should be created . member states should issue an eu blue card instead of a national permit to all applicants falling within the scope of this directive . member states should retain the right to issue permits other than eu blue card for any purpose of employment to third - country nationals who fall outside of the scope of this directive , subject to the limitations following from other directives in the area of labour migration . ### an eu - wide admission system to attract and retain highly skilled workers into the union should be created . member states should retain the right to issue permits other than eu blue card for any purpose of employment to third - country nationals who fall outside the scope of this directive or for national schemes which include more favourable provisions for the employment of highly - skilled third - country nationals covered by this directive , subject to the limitations following from other directives in the area of labour migration .


### member states shall make easily accessible to applicants the information on all the documentary evidence needed for an application and information on entry and residence conditions , including the rights , obligations and procedural safeguards , of the third - country nationals falling under the scope of this directive and of their family members . this information shall include information on the salary thresholds set in the member state concerned in accordance with article 5 , and , and on the applicable fees . ### member states shall make easily accessible to applicants the information on all the documentary evidence needed for an application and information on entry and residence conditions , including the rights , obligations and procedural safeguards , of the third - country nationals falling under the scope of this directive and of their family members . this information shall include information on the salary criteria set in the member state concerned in accordance with article 5 , and , and on the applicable fees .


### the level of fees required by member states for the processing of applications shall not be disproportionate or excessive . ### the level of fees required by member states for the processing of applications shall not be disproportionate or excessive and overall not higher than the level of fees required for other residence permit applications in the member state .


### an eu - wide admission system to attract and retain highly skilled workers into the union should be created . member states should issue an eu blue card instead of a national permit to all applicants falling within the scope of this directive . member states should retain the right to issue permits other than eu blue card for any purpose of employment to third - country nationals who fall outside of the scope of this directive , subject to the limitations following from other directives in the area of labour migration . ### an eu - wide admission system to attract and retain highly skilled workers into the union should be created . member states should retain the right to issue permits other than eu blue card for any purpose of employment to third - country nationals who fall outside of the scope of this directive , subject to the limitations following from other directives in the area of labour migration .


### member states should reject applications for an eu blue card and be allowed to withdraw or refuse to renew an eu blue card if there is a threat to public policy , public security or public health . any rejection on grounds of public policy or public security should be based on the individual behaviour of the person concerned , in accordance with the principle of proportionality . illness or disability suffered after the third - country national was admitted to the territory of the first member state should not constitute the sole ground for withdrawing or refusing to renew an eu blue card or for not issuing an eu blue card in a second member state . ### member states should be entitled to reject applications for an eu blue card and be allowed to withdraw or refuse to renew an eu blue card where there is a threat to public policy , public security or public health . any rejection on grounds of public policy or public security should be based on the individual behaviour of the person concerned , in accordance with the principle of proportionality . illness or disability suffered after the third - country national was admitted to the territory of the first member state should not constitute a ground for withdrawing an eu blue card . illness or disability suffered during the period when the third - country national is an eu blue card holder should not constitute the sole ground for objecting to mobility to a second member state or for refusing to renew an eu blue card .


### the transfer of responsibility for protection of beneficiaries of international protection is outside the scope of this directive : the protection status and the rights associated with it should not be transferred to another member state on the basis of the issuance of an eu blue card . ### the transfer of responsibility for protection of beneficiaries of international protection or applications for international protection is outside the scope of this directive : those statuses and the rights associated with them should not be transferred to another member state on the basis of the issuance of an eu blue card .


### the competent authorities of the member states shall adopt a decision on the application for an eu blue card and notify the applicant in writing , in accordance with the notification procedures laid down in the national law of the member state concerned . the notification shall be made at the latest within 60 days of the date of submission of the application . ### the competent authorities of the member states shall adopt a decision on the application for an eu blue card and notify the applicant in writing , in accordance with the notification procedures laid down in the national law of the member state concerned . the notification shall be made at the latest within 30 days of the date of submission of the application .


### in case member states decide to make use of this possibility for a given occupation or sector , possibly in a particular part of their territory , they should send a notification to the commission hereof , explaining the economic , social and other reasons justifying the decision to introduce such labour market test for the next 12 months and do so again for every subsequent 12 month period . member states may involve social partners in the assessment of the circumstances related to the domestic labour market . this verification should not be possible when an eu blue card is renewed in the first member state . for eu blue cards in a second member state , taking into account the situation of the labour market should only be possible if that member state has also introduced checks for first applications for third - country nationals coming from third countries and after a separate justified notification . in case member states decide to make use of this possibility , they should communicate this in a clear , accessible and transparent way to applicants and employers , including online . ### in the event that a member state decides to make use of this possibility for a given occupation or sector , possibly in a particular part of their territory , it should send a notification to the commission hereof , explaining the economic , social and other reasons justifying the decision to introduce such labour market test for the next six months and do so again for every subsequent six month period . member states should involve social partners in the assessment of the circumstances related to the domestic labour market . this labour market test should not be possible where an eu blue card holder seeks to renew his or her eu blue card in the first member state . where a third - country national notifies a second member state of his or her intention to take up work in that member state , taking into account the situation of the labour market when objecting to such a notification should only be possible if that member state has also introduced checks for first applications for third - country nationals coming from third countries and after a separate justified notification . in case member states decide to make use of this possibility , they should communicate this in a clear , accessible and transparent way to applicants and employers , including online .


### this directive should not apply to categories of third - country nationals to whom a particular scheme under union law , with specific entry conditions and sets of rights , applies when the inclusion of those categories in this directive would go against the rationale of the particular scheme , create unnecessary legal complexity or entail a risk of abuses . this directive should not apply to third - country nationals who apply to reside in a member state as researchers in order to carry out a research project , as they fall within the scope of directive 2016 / 801 of the european parliament and of the council37 which introduces a specific procedure for admitting third - country nationals for the purposes of scientific research . however , once admitted under directive 2016 / 801 , legally residing researchers should be entitled to apply for an eu blue card under this directive for other purposes than those covered under directive 2016 / 801 . __________________ 37 directive 2016 / 801 of the european parliament and of the council of 11 may 2016 on the conditions of entry and residence of third - country nationals for the purposes of research , studies , training , voluntary service , pupil exchange schemes or educational projects and au pairing . ### this directive should not apply to third - country nationals who apply to reside in a member state as researchers in order to carry out a research project , as they fall within the scope of directive 2016 / 801 of the european parliament and of the council37 which introduces a specific procedure for admitting third - country nationals for the purposes of scientific research . however , once admitted under directive 2016 / 801 , legally residing researchers should be entitled to apply for an eu blue card under this directive for other purposes than those covered under directive 2016 / 801 . equally , legally residing eu blue card holders should be entitled to apply to reside as researchers under directive 2016 / 801 . the provisions of that directive should be clarified so as to ensure such a possibility . __________________ 37 directive 2016 / 801 of the european parliament and of the council of 11 may 2016 on the conditions of entry and residence of third - country nationals for the purposes of research , studies , training , voluntary service , pupil exchange schemes or educational projects and au pairing .


### in order to attract highly skilled workers and encourage their continuous stay in the union , while enabling mobility within the union as well as circular migration , derogations from council directive 2003 / 109 / ec43 should be provided for in order to give eu blue card holders an easier access to eu long - term resident status . _________________ 43 council directive 2003 / 109 / ec of 25 november 2003 on the status of third - country nationals who are long - term residents . ### in order to attract highly skilled workers and encourage their continuous stay in the union , while enabling mobility within the union as well as circular migration , derogations from council directive 2003 / 109 / ec43 should be provided for in order to give eu blue card holders and their family members an easier access to eu long - term resident status . _________________ 43 council directive 2003 / 109 / ec of 25 november 2003 on the status of third - country nationals who are long - term residents .


### this article shall apply to eu blue card holders who are beneficiaries of international protection only when they reside in a member state other than the member state which granted them international protection . ### this article shall apply to eu blue card holders who are beneficiaries of international protection for what relates to any more favourable condition for family members which could derive from this directive , including when they reside in a member state other than the member state which granted them international protection .


### member states shall demonstrate that where there is an overlap in the impact of policy measures or individual actions , there is no double counting of energy savings . ; ### while recognising that efficiency gains from primary and final energy are complementary , member states shall demonstrate that where there is an overlap in the impact of policy measures or individual actions , there is no double counting of energy savings .


### this directive establishes a common framework of measures to promote energy efficiency within the union in order to ensure that the union ' s 2020 20 % headline targets and its 2030 30 % binding headline targets on energy efficiency are met and paves the way for further energy efficiency improvements beyond those dates . it lays down rules designed to remove barriers in the energy market and overcome market failures that impede efficiency in the supply and use of energy , and provides for the establishment of indicative national energy efficiency targets and contributions for 2020 and 2030 . ### this directive establishes a common framework of measures to promote energy efficiency within the union in order to ensure that the union ' s 2020 20 % headline targets and a 2030 40 % binding headline targets on energy efficiency are met and paves the way for further energy efficiency improvements beyond those dates in line with the union commitments made under the energy union and global climate agenda secured with the paris agreement of december 2015 . it lays down rules designed to remove barriers in the energy market and overcome market failures that impede efficiency in the supply and use of energy , in line with the ' energy efficiency first ' principle , which should help exploit the multiple benefits of energy efficiency for europe ' s society , in particular for citizens and businesses . it is an element to progress towards the energy union , under which energy efficiency should be treated as an energy source in its own right , and energy efficiency and demand side response can compete on equal terms with generation capacity . it also provides for the establishment of national energy efficiency targets for 2020 and 2030 .


### the commission shall evaluate this directive by 28 february 2024 at the latest , and every five years thereafter , and shall submit a report to the european parliament and the council . that report shall be accompanied , if appropriate , by proposals for further measures . ### the commission shall undertake a general review of this directive within six months of the unfccc global stocktake in 2023 at the latest , and after subsequent global stocktakes thereafter , and shall submit a report to the european parliament and the council assessing the general effectiveness of this directive and the need to adjust the union ' s energy efficiency policy in accordance with the objectives of the paris agreement . that report shall be accompanied , if appropriate , by proposals for further measures .


### the european council of october 2014 set a 27 % energy efficiency target for 2030 , to be reviewed by 2020 ' having in mind an union level of 30 % ' . in december 2015 , the european parliament called upon the commission to also assess the viability of a 40 % energy efficiency target for the same timeframe . it is therefore appropriate to review and consequently amend the directive to adapt it to the 2030 perspective . ### the european council of october 2014 set a 27 % energy efficiency target for 2030 , to be reviewed by 2020 ' having in mind an union level of 30 % ' . in december 2015 , the european parliament asked the commission to set a binding energy efficiency target of 40 % for 2030 which will reflect the level of cost - effective energy efficiency potential . it is therefore appropriate to review and consequently amend the directive to adapt it to the 2030 perspective


### energy generated on or in buildings from renewable energy technologies reduces the supplied fossil energy . the reduction of energy consumption and the use of energy from renewable sources in the buildings sector are important measures to reduce the union’s energy dependency and greenhouse gas emissions , especially in view of ambitious climate and energy objectives set for 2030 as well as the global commitment made in the conference of the parties of the united nation framework convention on climate change held in paris in december 2015 . member states should therefore be able to take into account a certain amount of renewable energy generated on or in buildings for own use into account to satisfy their energy savings requirements . for this purpose member states should be allowed to use calculation methodologies established under directive 2010 / 31 / eu . ### energy generated on or in buildings from renewable energy technologies reduces the supplied fossil energy . the reduction of energy consumption and the use of energy from renewable sources in the buildings sector are important measures to reduce the union’s energy dependency and greenhouse gas emissions , especially in view of ambitious climate and energy objectives set for 2030 as well as the global commitment made in the conference of the parties of the united nation framework convention on climate change held in paris in december 2015 . member states should therefore adopt ambitious , long - term renovation strategies in accordance with article 2a of directive 2010 / 31 / eu as in force , with the goal to arrive at a highly energy efficient , nzeb stock by 2050 with the remaining energy needs to be met by renewable energy .


### in order to be able to evaluate the effectiveness of directive 2012 / 27 / eu , a requirement for a general review of the directive and a report to the european parliament and the council by 28 february 2024 should be introduced . ### energy and climate law is complementary and should be mutually reinforcing . thus , as part of the obligations under the paris agreement , within six months of the unfccc global stocktake in 2023 and aligned to the review process of the governance regulation [ ] , the commission should undertake a general review of directive 2012 / 27 / eu and introduce a report to the european parliament and the council assessing the general effectiveness of directive 2012 / 27 / eu and the need to adjust the union ' s energy efficiency policy according to the objectives of the paris agreement . such a review and report should be undertaken in subsequent global stocktakes thereafter .