Opinion of the Economic and Social Committee on the 'Proposal for a Directive of the European Parliament and of the Council on the posting of workers who are third- country nationals for the provision of cross-border services', and the 'Proposal for a Council Directive extending the freedom to provide cross-border services to third-country nationals established within the Community'
Date: 1999-05-26
Institutions: European Economic and Social Committee
Subjects: EU Member State, freedom to provide services, frontier worker, provision of services, third country, wage earner

22.7.1999

EN

Official Journal of the European Communities

C 209/5

Opinion of the Economic and Social Committee on:

— the ‘Proposal for a Directive of the European Parliament and of the Council on the posting of
workers who are third-country nationals for the provision of cross-border services’, and

— the ‘Proposal for a Council Directive extending the freedom to provide cross-border services

to third-country nationals established within the Community’ (1)

(1999/C 209/02)

On 25 May 1999 the Council decided to consult the Economic and Social Committee, under Article 198
of the Treaty establishing the European Community, on the above-mentioned proposals.

The Section for the Single Market, Production and Consumption, which was responsible for preparing
the Committee’s work on the subject, adopted its opinion on 18 May 1999. The rapporteur was Mr
Liverani.

At its 364th plenary session (meeting of 26 May 1999), the Economic and Social Committee adopted the
following opinion with 70 votes in favour and six abstentions.

1.

Introduction

1.1.
The proposed European Parliament and Council Direc-
tive on the posting of third-country workers for the provision
of cross-border services is based on Article 57(2) of the EC
Treaty; this Article is cited in Article 66 with specific reference
to the provision of services (co-decision procedure). In contrast,
the proposed Council Directive extending the freedom to
provide cross-border services to third-country nationals estab-
lished within the Community is based on Article 59(2) (consul-
tation procedure).

1.2.
Both proposals provide for the issue of an ‘EC service
provision card’ to cover third-country nationals who are
legally resident and authorised to take up employment or be
self-employed in one Member State, and who have to move to
another Member State for the purpose of providing services
but face problems with visas, residence permits and work
permits. Whilst the proposals relate to the freedom to provide
services, they are also socially important for the free movement
of workers — including those from third countries —
regarding whom the Committee recently issued an opinion on
a Commission communication (2).

(1) OJC 67, 10.3.1999, p. 12-17.
(2) Opinion of the Economic and Social Committee on the Com-
mission communication on an action plan for free movement of
workers (COM(97) 586 final — OJ C 235, 27.7.1998, p. 82).

1.3.
The first proposal concerns Community businesses
providing cross-border services and wishing to second staff
who are nationals of third countries. Under the proposal, the
service provider would be able ‘at any time’ to second an
employee by sending a simple prior declaration to the
authorities of the Member State in which the service is to be
provided. The declaration system incorporates guarantees by
the country where the service provider is established, in the
form of an ‘EC service provision card’. The card is the same in
all Member States, has a limited duration of up to 12 months
and is not automatically renewable.

for

The second proposal concerns the freedom to provide
1.4.
services
self-
third-country nationals established as
employed within the Community. The aim is that a self-
employed third-country national should not be obliged to be
established in a second Member State in order to be able to
provide a service there. In these cases too, an EC service
provision card is to be introduced.

1.5.
The card — of limited duration — is to be issued by
the Member State in which the service provider is established.
The card regularises the employer’s situation and that of the
employee or self-employed person who is a third-country
national. The procedure spares the service provider from
having to comply with lengthy administrative formalities in
each Member State in which he wishes to provide a service. It
is made clear that the posting of a worker to provide a service
is quite different
to free movement and
employment within the Community. The administrative pro-
cedures for the Member State in which the service is provided
are also simplified. The EC service provision card ensures that
is
the Member State in which the third-country national
established allows this person to return at the end of the
posting.

from the right

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Official Journal of the European Communities

22.7.1999

2. General comments

2.1.
The Committee welcomes the Commission proposals.
They cover an increasingly widespread form of economic and
employment activity which hitherto has not been coordinated
at Community level, and will add to the important EU
legislation already in force on equal treatment of third-country
nationals and the removal of barriers to the freedom to provide
services — the area targeted by the present proposals.

2.2.
Amongst this earlier legislation, reference should be
made to Directive 96/71/EC (1); which requires firms posting
workers to another Member State to comply with a ‘hard core’
of essential minimum rules (notably as regards minimum
wages) in force in that country.

2.3. Mention should also be made of the recent extension
of Regulation (EEC) 1408/71 (2) to third-country nationals (3),
on which the Committee issued a favourable opinion (4).

2.4.
The Committee notes the EU’s undertaking to establish
a common position laying down the extent to which third-
country nationals who are legally and permanently resident in
the Community are entitled to be treated the same as EU
citizens (5). The Committee also stresses that Article 59(2) of
the 1957 Treaty of Rome envisaged extending the right to
provide services to workers who are third-country nationals,
but that this still remains to be done.

2.5.
At all events, the present proposals are justified not
only by the discrimination faced by third-country nationals
but more especially by the continuing serious obstacles to the
freedom to provide services. This state of affairs prompts the
Committee to endorse the principle — explicitly confirmed in
a recent recommendation (6) — that the conditions governing
the provision of services do not come under immigration
policy.

(1) Directive 96/71/EC of the European Parliament and of the Council
of 16 December 1996 concerning the posting of workers in the
framework of the provision of services (OJ L 18, 21.1.1997, p. 1).
(2) Council Regulation (EEC) 1408/71 of 14 June 1971 on the
application of social security schemes to employed persons, to
self-employed persons and to members of their families moving
within the Community (consolidated version in OJ L 28,
30.1.1997).

(3) Proposal for a Council Regulation (EC) amending Regulation
(EEC) 1408/71 as regards its extension to nationals of third
countries (OJ C 6, 10.1.1998, p. 15).

(4) ESC opinion of 25 March 1998 (OJ C 157, 25.5.1998, p. 30).
(5) Cf. Commission communication Towards an area of freedom, security

and justice,14.7.1998 (COM(1998) 459 final, p. 6).

(6) Council recommendation of 27.9.1996 on combating the illegal
employment of third-country nationals (OJ C 304, 14.10.1996,
p. 1, point 1, ‘scope’).

2.6. Member States’ legislation in this field varies greatly.
Some Member States treat secondment as being the same as
seeking employment with an employer established on their
territory, when this is clearly not the case in practice. In other
Member States, legislation is less strict but still requires a new
work permit — or an ad hoc instrument specially devised for
secondments — from the authorities in the region in which
the service is to be provided. Some Member States require the
employee to have worked for the same employer for at least a
year before he can be seconded; in some cases, this requirement
places an EU business at a disadvantage vis-à-vis a third-
country one, which is not subject to this obligation.

2.7.
Service providers established in a Member State other
than the one in which the service is to be provided face a
twofold disadvantage. Firstly, the lengthy red tape needed to
obtain authorisation from the authority of the country in
which the service is to be provided can seriously hamper — if
not prevent — the provision of the service if the person
concerned is a third-country national. Secondly, the checks
carried out by the Member State in which the service is to be
provided add to those already carried out by the Member State
in which the service provider is established.

The present proposals would undoubtedly help
2.8.
national authorities, who are currently obliged to check the
lawfulness of situations which are largely dependent on the
Member State in which the service provider is established.
Moreover, the authorities retain the right to make further
checks where they deem necessary. However, it is not entirely
clear whether a third-country entrepreneur whose evidence of
formal qualifications was acquired in a non-EU state can
provide services in all Member States provided that at least one
Member State recognises these qualifications. More precise
provisions should be formulated to this effect in the draft
directives.

The introduction of an EC service provision card also
2.9.
means that national authorities will no longer need to require
an entry visa, provided that the card certifies the lawfulness of
the situation in the Member State in which the service provider
is established. The Member State is also obliged to readmit the
card-holder at any time. So that the EC service provision card
can meet the requirements set out above, the Committee
considers it essential that the issue of such a card is linked
to the criterion of lawful employment with the seconding
company, in accordance with the procedures laid down by the
European Commission and the Council. The Committee asks
that every step be taken to ensure that the card cannot be

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Official Journal of the European Communities

C 209/7

tampered with for illicit purposes. This means using appropri-
ate technologies when manufacturing the card, and seeing that
the authorities exchange information promptly and efficiently.

effects of its proposed directives on the labour market in the
EU.

2.10.
EU businesses would also benefit from the introduc-
tion of the card for self-employed third-country nationals
established in the Union. The card would extend to the whole
Community the reference market for subcontractors, who are
often natural persons. In view of the proposed directive on the
posting of workers who are third-country nationals, denying
self-employed persons the same freedom to provide a service
would cause discrimination and distortion of the single market.
It
is unjustifiable that a self-employed person who is a
third-country national should be obliged to set up a company
in a Member State in order to be able to benefit from the
freedom to provide services.

2.11. Moreover, the Committee would point out that the
transposition of the proposed directives should be assessed
separately against the background of the planned enlargement
of the EU, particularly as regards transitional periods. The
Committee therefore calls upon the Commission to assess the

Brussels, 26 May 1999.

3. Conclusions

3.1.
The Committee is pleased to note that the proposals
anticipate the spirit of the changes introduced by the Amsterd-
am Treaty. This Treaty, which entered into force on 1 May
1999, adds a chapter on visas, asylum, immigration and other
policies related to an area of freedom, security and justice. The
status of a third-country national legally admitted as such to a
Member State will therefore be part of the future acquis
communautaire, particularly in the context of measures taken
under Article 63(4) of the new EC Treaty.

However,

3.2.
in the context of the free movement of
services, third-country nationals who have been legally admit-
ted to a Member State in order to take up employment or be
self-employed already had a link with the acquis communautai-
re (as, for example, do family members of EU workers) prior
to the entry into force of the Amsterdam Treaty. The nature of
the proposals currently under examination is such that they
fall within the framework of the single market.

The President

of the Economic and Social Committee

Beatrice RANGONI MACHIAVELLI