COMMISSION STAFF WORKING DOCUMENT IMPACT ASSESSMENT Initiative to partially revise Regulation (EC) No 883/2004 of the European Parliament and of the Council on the coordination of social security systems and its implementing Regulation (EC) No 987/2009 Accompanying the document Proposal for a regulation of the European Parliament and of the Council amending Regulation (EC) No 883/2004 on the coordination of social security systems and regulation (EC) No 987/2009 laying down the procedure for implementing Regulation (EC) No 883/2004 (Text with relevance for the EEA and Switzerland)
Date: 2016-12-16
Institutions: Directorate-General for Employment, Social Affairs and Inclusion, European Commission
Subjects: EU Member State, care allowance, family benefit, non-working population, social security legislation, social-security harmonisation, unemployment insurance

EUROPEAN 
COMMISSION 

Brussels, 16.12.2016  
SWD(2016) 460 final/2 

PART 1/6 

Corrigendum 
Annule e remplace le document SWD(2016) 460 final Part 1/6 du 13 décembre 2016. Erreur 
cléricale sur la page de couverture. 

COMMISSION STAFF WORKING DOCUMENT 

IMPACT ASSESSMENT 

Initiative to partially revise Regulation (EC) No 883/2004 of the European Parliament 
and of the Council on the coordination of social security systems and its implementing 
Regulation (EC) No 987/2009  

Accompanying the document 

Proposal for a regulation of the European Parliament and of the Council 

amending Regulation (EC) No 883/2004 on the coordination of social security systems 
and regulation (EC) No 987/2009 laying down the procedure for implementing 
Regulation (EC) No 883/2004 

(Text with relevance for the EEA and Switzerland) 

{COM(2016) 815 final} 
{SWD(2016) 461 final} 

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COMMISSION STAFF WORKING DOCUMENT 

IMPACT ASSESSMENT 

Initiative to partially revise Regulation (EC) No 883/2004 of the European Parliament 
and of the Council on the coordination of social security systems and its implementing 
Regulation (EC) No 987/2009  

Accompanying the document 

Proposal for a regulation of the European Parliament and of the Council 

amending Regulation (EC) No 883/2004 on the coordination of social security systems 
and regulation (EC) No 987/2009 laying down the procedure for implementing 
Regulation (EC) No 883/2004 

(Text with relevance for the EEA and Switzerland) 

TABLE OF CONTENTS 

1. 

INTRODUCTION AND BACKGROUND ................................................................4 

1.1.  EU rules on social security coordination ...........................................................4 
1.2.  Social and economic context .............................................................................5 
1.3.  Policy context .....................................................................................................7 

2.  OBJECTIVES & SCOPE OF THE INITIATIVE .....................................................10 

2.1.  Objectives of the review ..................................................................................10 
2.2.  Scope of the review ..........................................................................................10 
2.3.  Methodology used for the purpose of the impact assessment ..........................15 
2.4.  Stakeholder feedback .......................................................................................17 
2.5.  Definitions ........................................................................................................18 

3.  WHY SHOULD THE EU ACT? ...............................................................................18 

4.  LONG-TERM CARE BENEFITS .............................................................................19 

4.1.  Current Coordination Rules for Long-term Care Benefits ..............................19 
4.2.  Problems with the coordination of long-term care benefits .............................20 
4.3.  Baseline scenario .............................................................................................24 
4.4.  Objectives for coordination of long-term care benefits coordination rules .....24 
4.5.  What  are  the  various  options  to  achieve  the  objectives  concerning  long-

term care benefits? ...........................................................................................25 
4.6.  Stakeholder Support .........................................................................................28 
4.7.  What are the Impacts of the Different Options? ..............................................29 

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5.  UNEMPLOYMENT BENEFITS ..............................................................................39 

5.1.  Current Coordination Rules for Unemployment Benefits ...............................39 
5.2.  Aggregation of periods for unemployment benefits ........................................42 
5.3.  Export of Unemployment Benefits ..................................................................66 
5.4.  The rules on the provision of unemployment benefits for frontier and other 

cross-border workers ........................................................................................80 

6.  ACCESS  BY  ECONONICALLY  INACTIVE  MOBILE  CITIZENS  TO 

CERTAIN SOCIAL BENEFITS .............................................................................104 

Introduction ....................................................................................................104 

6.1. 
6.2.  Problems with access by economically inactive  mobile citizens to certain 

social benefits .................................................................................................105 
6.3.  Baseline Scenario ...........................................................................................107 
6.4.  Objectives for the review of the rules on access by economically inactive 

citizens to certain social benefits ...................................................................108 

6.5.  Options  for  addressing  the  problems  of  access  by  economically  inactive 

mobile citizens and jobseekers to certain social benefits ...............................109 
6.6.  Stakeholder support .......................................................................................111 
6.7.  What are the impacts of the Different Options ..............................................112 
6.8.  Conclusions ....................................................................................................123 

7.  FAMILY BENEFITS ..............................................................................................124 

7.1.  Current Coordination Rules for Family Benefits ...........................................124 
7.2.  Problems with the export of family benefits and drivers behind them ..........125 
7.3.  What are the  various  options to  achieve the objectives concerning export 

of family benefits ...........................................................................................133 
7.4.  Stakeholder Support .......................................................................................139 
7.5.  What are the Impacts of the Different Options ..............................................140 

8.  OVERALL CONCLUSION ....................................................................................163 

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10. 

11. 

12. 

HOW WOULD IMPACTS BE MONITORED AND EVALUATED?............171 

ANNEX I: PROCEDURAL INFORMATION……………………………….178 

ANNEX II: STAKEHOLDER CONSULTATION…………………………...182 

ANNEX IIII: WHO IS AFFECTED AND HOW……………………………..202 

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COMMISSION STAFF WORKING DOCUMENT 

IMPACT ASSESSMENT 

Initiative  to  partially  revise  Regulation  (EC)  No  883/2004  of  the  European  Parliament  and  of 
the Council on the coordination of social security systems and its implementing Regulation (EC) 
No 987/2009  

1.  Introduction and background 

1.1. 

EU rules on social security coordination 

The  right  of  EU  citizens  to  freely  move  to  and  live  in  any  EU  country,  along  with  their  family 
members,  is  one  of  the  four  fundamental  freedoms  enshrined  in  EU  law  and  a  cornerstone  of  EU 
integration.  

Free  movement  would  not  be  possible  without  the  guarantee  that  citizens  do  not  lose  their  social 
security protection when moving to another Member State. A system of social security coordination is 
essential  if  freedom  of  movement  is  to  work  in  practice.  It  is  for  this  reason  that  Article  48  of  the 
Treaty  on  the  Functioning  of  the  European  Union  (TFEU)  has  assigned  to  the  legislator  the 
competence to make arrangements to secure the right to benefits and the payment of the benefits to 
persons resident in another EU Member State. EU rules on social security coordination have existed 
since  the  1950s  for  this  purpose.  They  may  be  considered  the  "oil"  that  eases  the  wheels  of  free 
movement, facilitating the process of mobility but not compelling or incentivising mobility itself. 1  

The  essence  of  social  security  coordination  is  about  'linking'  a  person  to  a  social  security  system, 
determining where he or she needs to pay social security contributions and where to claim for social 
security benefits, if required. It also ensures that previous periods of insurance, work or residence in 
other countries are taken into account when a person claims benefits.  

The rules coordinate rather than harmonise: they do not address the national conditions for affiliation 
or  entitlement,  nor  do  they  envisage  introducing  a  minimum  level  of  protection,  or  oblige  Member 
States to introduce new benefits in their social security systems. Member States therefore retain the 
autonomy  to  design  their  social  security  systems  to  meet  national  requirements.  There  remain 
significant  differences  in  both  the  range  and  level  of  social  protection  provided  in  different  EU 
Member States, which can be a source of political tension and public debate. The coordination rules 
offer no guarantee that transferring one's residence or professional activities to another Member State 
is neutral as regards social security. Given the disparities in social security legislation, such transfer 
may work to one's advantage or not, depending on the circumstances. 

The rules on the coordination of social security have been adapted several times to ensure that they 
reflect legal and societal changes in Europe.2  

The current rules, Regulation (EC) No 883/2004 and the Implementing Regulation (EC) No 987/2009, 
came  into  force  on  1  May  2010  and  now  apply  to  both  workers  (and  their  family  members)  and 
citizens who are, or have been, covered by the social security legislation of a Member State and who 
are in a cross border situation.  

1 Benton, M., Reaping the benefits? Social security coordination for mobile EU citizens, MPI Policy Brief.  
Series, November 2013, http://www.migrationpolicy.org/pubs/MPIEurope-SocialSecurity-MobileCitizens.pdf. 
2 The current rules can be found in Regulation (EC) No 883/2004 of the European Parliament and of the Council of 29 April 2004 on the 
coordination of social security systems, OJ L 166, 30.4.2004, p. 1; Regulation (EC)  No 987/2009 of the European Parliament and of the 
Council  of  16  September  2009  laying  down  the  procedure  for  implementing  Regulation  (EC) No  883/2004  on  the  coordination  of  social 
security systems, OJ L 284. 

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EU law, in particular Regulation (EC) No 883/2004, establishes four key principles which subject to 
limited exceptions must be observed by all national authorities when applying national social security 
legislation:  

a)  non‐discrimination on grounds of nationality;  

b)  the aggregation of periods of insurance, employment or residence;  

c) 

the  waiving  of  residence  rules  meaning  that  benefits  in  cash  can  be  exported  to  another 
Member State; and  

d)  the  application  of  a  single  legislation  in  terms  in  respect  of  liability  to  contribute  and 

entitlement to benefits. 

The  material  scope  of  the  Regulation  (EC)  No  883/2004  extends  to  all  legislation  concerning  the 
following  branches  of  social  security:  sickness  (including  long-term  care  benefits);  maternity  and 
equivalent  paternity  benefits;  invalidity  pensions;  old-age  pensions;  survivors’  benefits;  benefits  in 
respect  of  accidents  at  work  and  occupational  diseases;  death  grants;  unemployment  benefits;  pre-
retirement  benefits;  and  family  benefits.  This  list  is  exhaustive.  Consequently,  a  branch  of  social 
security which is not mentioned is in principle outside the scope of the regulation. This is the case, for 
instance, for housing allowances or social assistance. 

Over and above these social security benefits, the coordination regulation also applies to special non-
contributory cash benefits listed in an annex (Annex X to Regulation (EC) No 883/2004). 

It should also be noted that since 1 June 2003, citizens from third countries who are legally residing in 
an  EU  Member  State  and  whose  situation  is  not  confined  within  a  single  Member  State  also  have 
rights under the EU social security coordination rules.3  

Social and economic context 

1.2. 
With 11 million EU citizens of working age (over 14 million4 for all ages) resident in another Member 
State, free movement – or the ability to live, work and study anywhere in the Union – is the EU right 
most cherished by Europeans.5 The main motivation for EU citizens to make use of free movement is 
work-related, followed by family reasons.  
Today,  8.3  million  EU  citizens  of  working  age  are  economically  active6  and  live  in  another  EU 
country,  representing  3.4%  of  the  total  EU  labour  force7.  Furthermore,  1.6  million  frontier  workers 
and other cross-border workers8,9 work in a Member State other than the one in which they reside, and 
some  1.45  million  workers  are  posted10,11.  Third-country  nationals  who  live  and  work  in  more  than 
one Member  State are also part of the intra-EU  mobile labour force and therefore participate to the 
much needed mobility of workforce across EU countries12,13.  

3 Regulation (EU) No 1231/10 extends the effect of Regulation (EC) No 883/2004 on the coordination of social security systems to third 
country nationals in a cross-border situation who would not otherwise be covered by these rules. This instrument replaced Regulation (EC) 
No 859/2003 which extended the earlier Regulation (EC) No 1408/71 on social security coordination to third country nationals. 
4 14.3 million, EU LFS data 2014. 
5 On 1 January 2014, 17.9 million citizens were living in a Member State other than their own. In Eurobarometer surveys, more than two 

thirds of Europeans consider that free movement of people within the EU has economic benefits for their country (67%). 

6 Economically active: working or looking for work. 
7 There are 8.3 million active EU28 nationals living in another EU Member State, while 9.3 million active EU28 nationals live in another 
EU/EFTA Member State. There are 8.4 million active EU28/EFTA nationals living in another EU Member State, while 9.4 million active 
EU28/EFTA nationals living in another EU/EFTA Member State (EUROSTAT, EU LFS 2015) 
8  Cross-border  workers  are  those  who  work  in  a  country  different  than  the  one  in  which  they  reside;  frontier  workers  are  cross-border 
workers who return to their place of residence at least once a week. 
9 1.2 million towards EU countries and 0.4 million towards EFTA countries.  
10  Posted  workers  are  those  who  have  their  employment  contract  in  the  home  country,  but  work  temporarily  in  another  country,  in  the 
framework of a cross-border service provision.  
11  Data  based  on  Portable  Documents  A1  (PD  A1)  issued  for  posting  workers  to  other  Member  States  in  2014,  collected  through  the 
Administration Commission for the Coordination of Social Security Systems and analysed in European Commission, Report on A1 portable 
documents issued in 2014 (2015). 
12 Though there is a lack of reliable statistical data, as shown in the EMN study (2013), Intra-EU mobility of third-country nationals 

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1.2.1  Free movement of workers 
Recent trends in free movement of workers14 

Of  the  8.3  million  active  EU  movers,  around  4.3  million  have  moved  to  their  current  country  of 
residence in 2004 or later ('recent movers'): over one third of these recent movers reside in the United 
Kingdom and around one fifth in Germany, and other important countries of recent active movers are 
Spain and Italy15.  

While still significantly below the level of the US, intra-EU labour mobility further increased between 
2012 and 2014. Flows from East to West continue to account for the bulk of movements, to a great 
extent driven by differences in GDP per capita and wages16: in 2013, about two-thirds of the intra-EU 
mobility  flows  were  from  Eastern  Member  States  to  the  West17.  Labour  mobility  has  attenuated 
disparities  in  unemployment,  and  was  reflected  in  the  increasing  importance  of  South  to  North 
mobility, from countries more affected by the financial and economic crisis to countries that were less 
affected:  while  in  2008  about  8%  of  the  EU  mobility  flows  to  the  main  destination  countries 
originated in the South, by 2013 this doubled to 17%18. Spain, Italy, and France, where large numbers 
of  ‘older’  waves  of  EU  movers  still  reside,  have  become  less  important  as  destination  countries.  In 
terms of total inflows, as it has been the case for the past 10 years, the United Kingdom remains the 
most important destination country, followed by Germany.  

Figures from 2012 and 2014 confirm a slight decrease in mobility of young people compared to older 
ones, most likely due to high rates of youth unemployment also in important destination countries due 
to the economic crisis. Between 2008 and 2012, following the onset of the economic crisis, there has 
been  a  large  increase  in  the  share  of  highly  educated  people  moving  to  another  country  (among  all 
EU-28/EFTA movers). This share has not increased further between 2012 and 2014.  

Characteristics of mobile EU citizens  
Mobile  EU  citizens19  are  more  likely  to  be  of  working  age  (15-64)  than  nationals  of  host  countries 
(78.0% vs. 65.7%); those of working age are more likely to be in employment (69.2%) than nationals 
(65.2%) and third country nationals (53.2%); EU mobile citizens have a significantly higher activity 
rate  than  nationals  (78.3%  versus  72.3%),  although  in  some  prominent  countries  of  residence,  like 
Germany,  France  and  Spain,  employment  among  recent  mobile  EU  citizens  is  lower  than  among 
nationals,  while  in  some  other  prominent  destinations  like  the  United  Kingdom  and  Italy  the 
employment rate of recent EU mobile is actually considerably higher than that of nationals20. Mobile 
EU  citizens  also  have  a  slightly  higher  unemployment  rate  (11.7%  versus  9.9%),  and  more  recent 
mobile  EU  workers  even higher:  this  is  likely  to  be  linked  to  the  fact  that  mobile  EU  workers,  and 
immigrants  in  general,  tend  to  be  more  vulnerable  to  business-cycle  fluctuations  than  natives,  and 
more recently arrived mobile EU workers more than long-established ones.21 

Cross-border workers 

In  addition  to  the  8.3  mobile  EU  workers,  who  work  and  live  in  another  country,  cross-border  (or 
frontier) workers are EU citizens who live in an EU country and work in another one. In 2014, there 

http://ec.europa.eu/dgs/home-affairs/what-we-do/networks/european_migration_network/reports/docs/emn-studies/intra-eu-mobility/emn-
synthesis_report_intra_eu_mobility_final_13th_august_2013.pdf  
13  Highly  mobile  workers  represent  a  specific  group  of  workers;  they  may  belong  to  different  categories  (e.g.  posted  workers,  workers 
working in more than one Member State…) and may be particularly present in certain sectors. For instance, around 2 million workers are 
engaged in international road transport operations and carry out work on the territory of different Member States, often only for brief periods 
of time (Commission estimate based on the number of Community licences) .  
14 For more information, see 2015 Annual Report on Labour Mobility, European Commission (2015). 
15 See Figure 1 in Annex I. 
16 For the importance of GDP in explaining flows, see European Commission (2015), Labour Market and Wage Developments in Europe. 
17 Calculations based on 2015 Annual Report on Labour Mobility, cit. above. 
18 Calculations based on 2015 Annual Report on Labour Mobility, cit. above. 
19  A  total  of  11  million  EU/EFTA  citizens  of  working  age  live  in  another  EU  Member  State  than  their  country  of  citizenship  (which 
comprises the 8.4 million living and economically active). 
20 See 2015 Annual Report on Labour Mobility, cited above. 
21EUROSTAT/LFS (2013-2014); 2015 Annual Report on Labour Mobility, cit. above. 

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were about 1.6 million people who worked in a different EU or EFTA country from the one in which 
they resided: about 1.2 million worked in another EU country (accounting for 0.6% of the employed 
EU population), and 382.000 worked in an EFTA country (making up 5.4% of the EFTA employed 
population). 

The  analysis  above  has  been  prepared  with  reference  to  data  from  2014.    As  this  report  had  been 
approved by the Regulatory Scrutiny Board prior to the publication of the Annual Report on Labour 
Mobility 2016, the authors have not substantially revised the data described above to include the latest 
statistics  available  in  relation  to  the  reference  year  2015.  However,  it  should  be  noted  that  in  2015 
there was a slight increase in the numbers of working-age EU-28 citizens who are working or seeking 
work in one of the 28 EU Member States other than their country of citizenship to 8.5 million. This 
variation is not anticipated to have a material impact upon the analysis contained in this report. 

Policy context 

1.3. 
Evidence  points  strongly  to  the  economic  benefits  of  labour  mobility:22  the  single  market  provides 
broader economic opportunities than the sum of segmented markets, and labour mobility helps correct 
imbalances  between  high  and  low  unemployment  regions  by  matching  labour  supply  with  demand. 
This  contributes  to  job  creation,  promoting  economic  growth,23  competitiveness  and  innovation.24 
Labour  mobility  also  helps  to  address  skills  mismatches  across  borders  (skills  gaps).  This  has  been 
particularly  important  in  the  context  of  the  current  economic  and  unemployment  crisis  where  some 
countries  are  facing  higher  unemployment  (in  particular  amongst  young  highly  qualified  people), 
while  others  face  a  shortage  of  skilled  workers  due  to  demographic  trends  within  their  own 
population. Within the European Monetary Union, mobility may serve to mitigate cyclical adjustment 
measures  in  response  to  asymmetric  shocks25.  Intra-EU  labour  mobility  may  have  prevented  even 
stronger spikes in unemployment during the crisis26, and empirical  analysis also suggests that intra-
EU  labour  mobility  has  played  a  significant  equilibrating  role  during  the  crisis  notwithstanding  the 
low  levels  of  labour  mobility.27  Available  estimates  suggest  that  up  to  a  quarter  of  the  asymmetric 
labour market shock could be absorbed by migration within a year28.  
Between 2004 and 2009, the GDP of EU-15 has increased by around 1%29 in the long-run as a result 
of  mobility30  and  even  more  in  major  destination  countries,  such  as  Ireland,  the  United  Kingdom, 
Spain  or  Italy.  The  effect  of  mobility  since  2004  on  the  unemployment  rate  and  wages  in  the 
destination countries has been estimated to be marginal, at least in the long-run31. The impact tends to 
be  short-term,  moderate  and  concentrated  on  specific  groups,  in  particular  the  low-skilled  workers, 
whilst it could also lead to reductions in the price of services and to consumer surpluses.32  

22See review of studies in European Commission, ESDE 2011 (chapter 6); EPC (2013);  
23 Baas and Brücker, The macroeconomic consequences of migration diversion: evidence for Germany and the UK, 2012, NORFACE ERA-
NET (TEMPO). 
24European Commission, Mobile researchers lead to higher research impacts and more innovation, 2015 
https://ec.europa.eu/commission/content/mobile-researchers-lead-higher-research-impacts-and-more-innovation_en.  
25 Labour Market and Wage Developments in Europe 2015, European Commission. 
26 ESDE 2015. 
27 Chaloff, Jonathan, et al. (2012), “Free labour mobility and economic shocks: the experience of the crisis”, in OECD, Free Movement of 
Workers  and  Labour  Market  Adjustment:  Recent  Experiences  from  OECD  Countries  and  the  European  Union,  OECD  Publishing.  The 
impacts  of  labour  mobility  on  unemployment  in  the  EU27/EFTA  area  may  have  been  reduced  by  about  6%  at  the  maximum  during  the 
crisis, yet this has to be compared with the low share of mobile workers. 
28 OECD (2014), Matching Economic Migration with Labour Market Needs, OECD Publishing, Paris. 
29"The  level  of  output  in  the  EU-15  may  have  risen  by  about  0.7  per  cent  over  the  six  year  period  to  2009  as  a  result  of  the  population 
movements, adding about 0.1 percentage points to GDP growth per annum on average" NIESR 2011, Labour mobility within the EU - The 
impact of enlargement and the functioning of the transitional arrangements.  
30 On the positive effects of intra-EU labour mobility following recent enlargements, see, for instance, European Commission, Report from 
the Commission to the Council on the Functioning of the Transitional Arrangements on Free Movement of Workers from Croatia (2015) 
31NIESR 2011  
32  European  Commission,  ESDE  2011,  chapter  6,  pp.275-276;  Constant  A.F.,  Do  migrants  take  the  jobs  of  native  workers?  IZA  (2014); 
Perini G, Do immigrant workers depress the wages of native workers? IZA  (2014); M. Foged and G. Peri,  Immigrants’ Effect  on Native 
Workers: New Analysis on Longitudinal Data*, IZA Discussion Paper No. 8961 (March 2015), arguing that immigration had positive effects 
on  native  unskilled  wages,  employment  and  occupational  mobility;  and  Dustmann,  C.,  Frattini,  T.  and  Preston,  I.  (2013),  “The  Effect  of 
Immigration along the Distribution of Wages”, Review of Economic Studies, 80 (1), 145–173, arguing that although immigration depresses 
native wages below the 20th percentile of the wage distribution, it leads to slight wage increases in the upper part of the wage distribution, 

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Finally, to EU citizens, the wider freedom of movement is the right most closely associated with EU 
citizenship33; 56% of European citizens see it as the most positive achievement of the EU34; 67% of 
EU citizens think that free movement brings economic benefits for their country's economy35.  

Notwithstanding its overall economic benefits, the impact of labour mobility on the ground is subject 
to debate both in countries of destination and countries of origin. Concerns have been raised, notably 
in some countries of destination, in relation to potential negative effects of free movement of workers 
and posting of workers such as the exploitation of mobile EU workers36 with adverse effects on local 
jobs and wages, pressure on local services, socio-economic inclusion, and poverty migration (mobility 
of unskilled workers who are at risk of losing their job and representing a welfare burden). Also, in 
spite  of  evidence  to  the  contrary37,  concerns  have  sometimes  been  raised  about  the  risk  of  benefit 
tourism,  i.e.  the  idea  that  mobility  is  driven  by  differences  in  welfare  benefits,  or  by  fraudulent 
behaviour.  

Specific concerns have also been raised in some countries of origin, in relation to the adverse long-
term  effects  on  economic  development  and  consequences  for  access  to  essential  services  such  as 
healthcare,  represented  by  the  sudden  outflow  of  workers,  and  particularly  young  workers  (youth 
drain),  and  highly  educated  workers  (brain  drain),  including  health  workers38.  This  is  only  partially 
compensated by return migration (which made up 20% of migration flows in 2013) or remittances. 

A  general  challenge,  as  highlighted  above,  is  the  fact  that  these  popular  concerns  are  difficult  to 
substantiate  with  hard  facts  and  data,  and  often  appear  to  be  based  on  negative  perceptions  and 
anecdotal accounts rather than well-founded on evidence. They also do not always acknowledge the 
distinction  between  requirements  imposed  by  EU  law  and  the  responsibility  of  Member  States  to 
exercise national competencies to enforce the correct application of the rules and invest in detection 
and prevention of abusive behaviour. 

Commission  President  Juncker,  in  his  Political  Guidelines,  has  underlined  that  "free  movement  of 
workers  is  one  of  the  pillars  of  the  internal  market",  a  fundamental  right  enshrined  in  the  Treaty. 
However, at the same time he also underlined that the internal market must be fair and that there is no 
place for abuse and fraud in the EU39. 

One of the Commission's priorities is work towards a deeper and fairer Internal Market. In the 2015 
Work  Programme,  it  has  been  underlined  that  "It  will  be  important  to  support  labour  mobility, 
especially  in  cases  of  persistent  vacancies  and  skills  mismatches,  including  across  borders,  while 
supporting the role of national authorities in fighting abuse or fraudulent claims."  

A  balanced  approach  to  mobility  is  therefore  needed  both  in  order  to  maximise  the  benefits,  while 
minimising  possible  unwanted  consequences:  measures  should  be  taken  to  facilitate  mobility,  but 
efforts  should  also  focus  on  supporting  national  authorities  to  prevent  fraud,  abuse  and  error  and 
renewing efforts to ensure rules are clear, fair and enforceable. The Commission has indicated that it 
will help public authorities to better implement and enforce existing rules and that it will revise the 
rules where necessary to adapt them to the economic and social challenges raised by today’s mobility. 

Achieving  a  modernised  system  of  social  security  coordination  that  responds  to  the  social  and 
economic reality in Member States has been one of the central drivers for the Commission to continue 
the  modernisation  process  of  social  security  coordination  that  started  more  than  a  decade  ago. 

and  has  an  overall  positive  wage  effect.  Bratsberg  and  Raaum,  Immigration  and  Wages:  Evidence  from  Construction,  2011,  NORFACE 
ERA-NET (MI3). 
33 Flash Eurobarometer (EB) 365, February 2013 http://ec.europa.eu/public_opinion/flash/fl_365_en.pdf. 
34 Standard EB 79, May 2013 http://ec.europa.eu/public_opinion/archives/eb/eb79/eb79_en.htm. 
35 Flash Eurobarometer 365 (2013). 
36 See  European Union Agency for Fundamental Rights (2015),  Severe labour exploitation: workers moving within or into the European 
Union.  
37 Giulietti, C., The welfare magnet hypothesis and the welfare take-up of migrants, IZA (2014). 
38 Health professionals rank first on the number of decisions taken on recognition of professional qualifications for the purpose of permanent 
establishment 
Switzerland 
countries 
(http://ec.europa.eu/internal_market/qualifications/regprof/index.cfm?action=stat_ranking&b_services=false). 
39 http://ec.europa.eu/commission/2014-2019/president_en. 

Member 

States, 

within 

EEA 

and 

EU 

the 

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Achieving greater clarity over the social security coordination system is an important step to face the 
challenges and controversies that exist over intra-EU mobility and to address demographic challenges 
ahead of us. 

Coherence with other EU policies 

This initiative may be seen to complement a number of existing, recent and planned initiatives in this 
policy field including: 

-  Directive  2004/38/EC  of  the  European  Parliament  and  of  the  Council  of  29  April  2004  on  the 
right of citizens of the Union and of their family members to move and reside freely within the 
territory of the Member States;40 

- 

- 

- 

- 

- 

the Communication on Free movement of EU Citizens and their families: five actions to make a 
difference (COM(2013)837final);  

the 2013 citizenship report (COM(2013)269); 

the Directive 2014/54/EU on measures facilitating the exercise of rights conferred on workers in 
the context of freedom of movement for workers; 

the  proposal  (COM/2014/06final)  for  a  regulation  on  a  European  network  of  Employment 
Services, workers' access to mobility services and the further integration of labour markets, which 
aims to enhance access of workers to intra-EU labour mobility support services, thus supporting 
fair mobility and increasing access to employment opportunities throughout the Union; 

the Decision (EU) 2016/344 of the European Parliament and of the Council of 9 March 2016 on 
establishing a European Platform to enhance cooperation in tackling undeclared work , which will 
bring  together  different  national  enforcement  authorities  of  the  EU  Member  States  to  exchange 
best practices, develop expertise and analysis and support cross-border operational actions;  

- 

the  proposal  for  a  Directive  of  the  European  Parliament  and  of  the  Council  (COM(2016)  128 
final)  amending  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 
-  The EU policy framework for legal migration, including the EU Blue Card Directive41 and Single 
Permit Directive,42 measures for seasonal workers,43 intra-corporate transferees,44 for students and 
researchers45, measures for family reunification46 and long term residents;47  

- 

the ongoing work on a comprehensive European Agenda on Migration, which is aimed at building 
up  a  coherent  and  comprehensive  approach  to  reap  the  benefits  and  address  the  challenges 
deriving  from  migration,  including  make  Europe  an  attractive  destination  for  the  talent  and 
entrepreneurship of students, researchers and workers; 

40 Directive 2004/38/EC of the European Parliament and of the Council of 29 April 2004 on the right of citizens of the Union and of their 
family members to move and reside freely within the territory of the Member States amending Regulation (EEC) No 1612/68 and repealing 
Directives 64/221/EEC, 68/360/EEC, 72/194/EEC, 73/148/EEC, 75/34/EEC, 75/35/EEC. 
41  Council  Directive  2009/50/EC  of  25 May  2009  on  the  conditions  of  entry  and  residence  of  third-country  nationals  for  the  purposes  of 

highly qualified employment. 

42 Directive 2011/98/EU of the European Parliament and of the Council of 13 December 2011 on a single application procedure for a single 
permit for third-country nationals to reside and work in the territory of a Member State and on a common set of rights for third-country 
workers legally residing in a Member State. 

43 Directive 2014/36/EU of the European Parliament and of the Council of 26 February 2014 on the conditions of entry and stay of third-

country nationals for the purpose of employment as seasonal workers. 

44 Directive 2014/66/EU of the European Parliament and of the Council of 15 May 2014 on the conditions of entry and residence of third-

country nationals in the framework of an intra-corporate transfer. 

45 Council Directive 2004/114/EC of 13 December 2004 on the conditions of admission of third-country nationals for the purposes of 
studies, pupil exchange, unremunerated training or voluntary service. In March 2013, the Commission made a proposal to further improve 
current rules, including by setting clearer time limits for national authorities to decide on applications, providing for increased access to the 
jobseeking markets, and facilitating intra-EU movement. 
46 Council Directive 2003/86/EC of 22 September 2003 on the right to family reunification.  
47 Council Directive 2003/109/EC of 25 November 2003 concerning the status of third-country nationals who are long-term residents 

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- 

- 

ongoing work on the European Network of Employment Services strengthening the European job 
mobility portal (EURES) and the cooperation between employment services; 

ongoing work on the Investment Plan for Europe; 

-  The planned Internal Market Strategy for Goods and Services. 

-  Ongoing work to implement the Electronic Exchange of Social Security Information (EESSI): an 
IT system that will help social security bodies across the EU exchange information more rapidly 
and securely – as required by Regulation (EC) No 883/2004 and its Implementing Regulation; 

-  The  planned  initiative  for  a  Fresh  Start  to  address  the  challenges  of  work-life  balance  faced  by 

working families; 

-  The planned review of the disability strategy 2010-2020 assessing progress to ensure the effective 

implementation of the UN Convention on the Rights of Disabled Persons across the EU. 

In addition, work on this initiative may be seen in the context of the deepening of EMU, and policies 
addressing  demographic  ageing  and  structural  reform  in  labour  markets  while  promoting  a  social 
agenda to support the economic recovery ensuring a Triple A social rating for Europe.  

Furthermore,  work  has  been  conducted  with  regard  to  the  European  Parliament  resolution  of  16 
January 2014 calling for the respect for the fundamental right of free movement in the EU. 

2.  OBJECTIVES & SCOPE OF THE INITIATIVE 

2.1.  Objectives of the review  

The key policy objective of this initiative is to continue the modernisation of the EU Social Security 
Coordination  Rules  by  further  facilitating  the  exercise  of  citizens'  rights  while  at  the  same  time 
ensuring legal clarity, a fair and equitable distribution of the financial burden among the institutions 
of the Member States involved and administrative simplicity and enforceability of the rules. It does 
not envisage granting new rights to EU citizens but on the contrary clarifying the current methods of 
coordination. 

This  initiative  serves  to  facilitate  the  exercise  of  the  right  to  free  movement  by  ensuring  social 
security coordination is efficient and effective and does not act as a deterrent to free movement. It is 
in the interests of all parties to design co-ordination rules that allow full exercise of rights of citizens 
whilst  ensuring  coordination  requirements  for  both  citizens  and  Member  States  are  clear  and 
transparent and thereby easy to apply and enforce. It is also important the rules are fair (in particular 
in  relation  to  the  relative  balance  of  responsibility  between  Member  States  who  receive  or  have 
received  social  security  contributions  and  the  obligation  to  pay  benefits)  and  that  perceptions  of 
unfairness  are  properly  investigated  and  addressed  when  they  arise.  Further,  the  rules  should  be 
efficient in terms of cost, administrative burden and risk of fraud or administrative error. Finally the 
rules  should  be  effective  in  relation  to  meeting  the  overall  goals  of  coordination  in  particular 
safeguarding  the  continuity  of  social  security  protection  as  citizens  move  from  from  one  Member 
State to another. 

This overarching policy objective underpins and informs all elements of this partial review, however, 
more specific objectives are included in each distinct area under consideration. 

2.2. 

Scope of the review 

To  achieve  this  overall  objective,  this  impact  assessment  report  considers  the  impact  of  possible 
improvements to the rules in four distinct areas: 

•  Long-term care benefits, 

•  Unemployment benefits, 

•  Access to social benefits for economically inactive mobile EU citizens, 

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•  Family benefits. 

These areas have been identified following the Commission's services assessemment of the extent to 
which the current legal framework still ensures the effective coordination of social security rights. 

Regulation (EC) No 883/2004 and the Implementing Regulation (EC) No 987/2009 came into force 
on  1  May  2010.  They  contain  formal  review  obligations  which  have  obliged  the  Administrative 
Commission  for  Social  Security  Coordination  ('Administrative  Commission')48  and  the  Commission 
Services to review and assess the implementation and effectiveness of particular provisions contained 
within the EU Social Security Rules and obligations undertaken by declaration.  

In addition to these formal review obligations, the Commission's work has been informed by ongoing 
dialogue  with  the  Member  States  within  the  framework  of  the  Administrative  Commission    and  of 
course feedback and complaints from citizens, social partners and other stakeholders, which identify 
on the one hand where the rules are effective and on the other hand where problems arise. In April 
2011,  one  year  after  the  adoption  of  Regulations  (EC)  nos  883/2004  and  987/2009,  Member  States 
took  part  in  an  informal  evaluation  exercise  in  Budapest.  This  discussion  concluded  that  while  the 
rules were functioning well, there were some areas where improvements were necessary, in particular 
in  the  field  of  long-term  care  benefits,  where  the  lack  of  a  bespoke  legislative  framework  for 
coordination was causing difficulties in practice. 

In the field of unemployment benefits, the Council took the decision in December 2011 to review the 
effect of adding a new provision on unemployment benefits for self-employed frontier workers within 
a period of two years after its application. At this meeting and at the request of a majority of Member 
States,  the  Commission  issued  a  declaration  that  the  review  would  be  an  occasion  to  open  up  a 
broader discussion on the current coordination provisions in the field of unemployment benefits and 
to assess the need for a review of its principles. 

In  addition,  in  relation  to  the  views  of  stakeholders,  the  Commission's  work  has  been  informed  by 
reports from expert networks, such as TreSS and FreSsco, in particular the 2013 Think Tank Report 
Key challenges for the social security regulations in the perspective of 2020.49  

In  light  of  the  difficulties  relating  to  long-term  care  benefits  and  unemployment  benefits  (the 
competence  for  paying  unemployment  benefits  to  frontier  workers  and  export  of  unemployment 
benefits), a first analysis already took place in 2013/2014 on the coordination of these benefits. The 
Impact  Assessment  Board  gave  a  positive  opinion  on  the  Impact  Assessment  Report  on  21  January 
2014. In view of the finishing mandate of the Barroso II Commission, the adoption of any legislative 
measures was not pursued in 2014.  

Meanwhile,  following  developments  in  the  Court's  case  law  and  in  the  socio-economic  reality  the 
scope of the partial review was expanded to also respond to challenges in the field of family benefits 
and access of economically inactive EU citizens to social benefits.  

A  Problem  Tree  showing  the  inter-relationship  between  the  problems  and  drivers  across  the  four 
strands of this revision exercise is set out below together with a option tree summarising the options 
that  have  been  considered  for  each  strand  and  how  they  relate  to  the  general  and  specific  policy 
objectives. 

For coherency reasons, the assessment of the '2014' and '2015' policy options has been combined in 
this  Impact  Assessment  report,  with  the  underlying  data  for  the  '2014'  analysis  updated  where 
appropriate.  

48 The Administrative Commission is comprised of Member States' representatives. Norway, Iceland, Lichtenstein and Switzerland 
participate as observers. The committee is responsible for dealing with administrative matters, questions of interpretation arising from the 
provisions of regulations on social security coordination, and for promoting and 
developing collaboration between EU countries. The European Commission also participates in the meetings and provides its Secretariat. 
49 The report may be consulted at: 
http://www.tress-network.org/TRESS/EUROPEAN%20RESOURCES/EUROPEANREPORT/trESSIII_ThinkTank%20Report%202013.pdf 

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Finally,  the  revision  will  also  include  a  number  of  proposals  for  technical  amendments  to  the 
coordination rules. The amendments will clarify the rules, but will not substantially revise them and 
are not subject to a formal Impact Assessment. For further details of these proposals please see Annex 
XX of this report. 

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Combined problem tree on the partial review of Regulation (EC) No 883/2004 of the European Parliament and of the Council on the 
Coordination of Social Security Systems and its Implementing Regulation (EC) No 987/2009 

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2.3.  Methodology used for the purpose of the impact assessment 
For  the  purpose  of  this  report,  each  section  will  summarise  the  economic,50  social  and  regulatory 
impacts51, of each policy option under consideration compared to the baseline scenario. In addition, 
the analysis assesses other impacts which have been identified as relevant before making an overall 
assessment of the effectiveness in achieving the specific objectives of the initiative, their efficiency 
(cost-effectiveness/even burden sharing) and coherence with the general objectives of the EU. 

In relation to social rights, the impact assessessment primarily examines the impact of an option in 
relation to clarity, simplification and protection of rights.52 When assessing possible limitations in the 
access  of  mobile  EU  citizens  to  certain  benefits,  the  assessment  refers  to  the  maximum  potential 
impact, since Member States are always allowed to be more generous than what is prescribed in EU 
law  when  granting  benefits  to  mobile  EU  citizens.  The  impact  on  rights  recognised  under  the  EU 
Charter of Fundamental Rights has also been assessed. 53 

As  regards  economic  impacts,  the  report  focuses  upon  the  direct  costs  for  Member  States  for 
providing social security benefits and the relative distribution financial costs between Member States. 
In line with the legal basis for the EU Social Security Coordination rules the scope of the initiative is 
to coordinate not harmonise social security legislation between Member States. Therefore, while the 
impact  of  EU  measures  is  assessed,  this  is  distinguished  from  impact  that  already  stems  from 
differences between Member State social security schemes. This means the options do not assess the 
payment  of  'contributions'  by  insured  persons  or  employers  (levies  earmarked  for  social  security 
purposes)  into  national  social  security  schemes  before  the  contingency  occurs.54  The  impact  on 
taxation is also left aside, as under Regulation (EC) No 883/2004 only contributions are coordinated, 
while  general  taxation  is  not.  When  assessing  the  economic  impact  of  possible  limitations  in  the 
access  of  mobile  EU  citizens  to  certain  benefits,  the  methodology  assumes  the  maximum  potential 
impact were Member States to rely upon derogations which are permitted (but not required) by EU 
law. 

In  addition,  an  assessment  has  been  made  of  the  other  impacts  associated  with  each  option 
specifically  regulatory  costs,  the  impact  on  the  risk  of  fraud  and  abuse)  and  fair  burden  sharing 
between Member States. In relation to secondary impacts, some cautious estimates of the impact upon 
mobility flows have been done on the basis of studies in a selected number of States: however, also in 

50 Quantified to the extent possible on the basis of the information in Annexes V, IX, X, XIII, XIV. 
51  In  line  with  the  new  better  regulation  guidelines  it  is  essential  that  social  aspects  are  considered  on  equal  footing  by  the  Commission 
services  and  the  Regulatory  Scrutiny  Board.  In  assessing  social  impacts,  simplification  and  clarification  of  the  coordination  rules  in 
Regulation (EC) No 883/2004 and protection of rights of mobile EU workers have been assessed. This also includes possible effects with 
regard to the risk of fraud and abuse. For the options concerning the competence for paying unemployment benefits to frontier and cross-
border workers, the re-integration into the labour market is also assessed. 
52 Relating to policy domain v in the Impact Assessment Guidelines under the social pillar: Social protection,  
health, coordination of social security and educational systems. 
53 The rights deriving from the Charter of Fundamental Rights of the European Union against which the  
options are assessed are the following: 
-  
- 
- 
- 
- 
- 
- 
- 
- 
- 
- 

the protection of personal data (Article 8), 
freedom to choose an occupation and the right to engage in work in another Member State (Article 15); 
right to property (Article 17); 
non-discrimination (Article 21); 
best interests of the child (Article 24) 
the rights of the elderly (Article 25),  
integration of persons with disabilities (Article 26), 
the right to family and professional life (Article 33) 
social security and social assistance (Article 34); 
health care (Article 35); 
freedom of movement and residence (Article 45). 

54 For instance, under the current situation as well as under each of the proposed options, a worker will continue to pay  
contributions in the State in which he/she is insured. It should be noted the level of benefits paid and contributions imposed is a  
matter of competence for the Member States and outside the scope of the EU social security rules.  

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light of the very low numbers of people who would be affected, such secondary impacts are estimated 
to be marginal.55  

Furthermore  the  report  seeks  to  examine  the  overall  impact  of  each  option  with  reference  to 
coherence of each option with the general, specific objectives as set out in section 2.1 and depicted in 
the  option  tree  on  page  12  of  this  report.  Where  relevant,  this  assessment  also  considers  overall 
coherence with the other EU policy initiatives and objectives referred to in section 1.3 of this report. 56  

Each chapter of this report provides a summary and more detailed table of results of the impact of a 
policy option. The degree to which options are relevant, effective and efficient are indicated on a scale 
from one to three : ++ for a highly positive assessment, + for a moderate positive assessment, - for a 
negative  assessment.  Where  a  option  has  both  a  negative  and  a  postive  aspect,  a  +/-  is  indicated, 
highlighting the mixed impact. The sign 0 is used to indicate that the option is considered to be neutral 
in comparison to the baseline scenario.  

The combined effect of this analysis has been used to make an assessment of overall effectiveness and 
overall efficiency. Effectiveness has been measured by a qualitive assessment of the effectiveness of 
an  option  in  achieving  the  the  general  and  specific  objectives  and  its  score  in  respect  of  the  social, 
economic  and  other  impacts  referred  to  above.  By  contrast  overall  efficiency  has  been  assessed  by 
reference to the overall effectiveness of each option compared to its financial impact (economic and 
regulatory  costs).  The  rationale  used  to  underpin  these  overall  assessments  is  explained  in  the 
conclusions to each section of the report.  

No impact on the competitiveness of specific sectors is foreseen by any of the options, as the subject 
matter does not concern commercial activities of enterprises.57 

The coordination rules are directly addressed to Member States and their institutions and only concern 
the  services  provided  under  the  public  social  security  system.  Small  and  medium  size  enterprises 
(SMEs)  are  not  directly  affected.  They  will  provide  their  services  under  the  conditions  set  by  the 
national  legislation.  In  the  public  online  consultation,  private  organisations  and  public  and  private 
employers had the opportunity to react.  

Whilst  it  is  true  that  mobility  in  itself  entails  movements  between  Member  States  and  that  these 
movements are accompanied by vehicle emissions, no significant environmental impact58 is expected 
from  the  options  under  consideration  because  of  the  marginal  secondary  impacts  on  mobility  in 
comparison to general mobility flows.  

Several studies, using different analytical models and methodologies, have been used to prepare the 
impact assessments.59 In general, the studies rely on a combination of data sourced through EU-wide 
surveys such as the Labour Force Survey or data published by Eurostat. This has been complimented 
by  data  collected  from  national  competent  authorities  within  the  framework  of  the  Administrative 
Commission,  in  particular  with  reference  to  the  payment  of  social  security  benefits  within  the 
framework of the EU Social Security Rules or the issuance of portable documents attesting to rights 
acquired under the Regulations on the basis of the sources identified in Annex IV. Since options on 
the  coordination  of  long-term  care  benefits,  coordination  of  unemployment  benefits  for  frontier 
workers and export of unemployment benefits had been assessed in 2013-2014, an update with more 
recent and newly available data has been conducted in 2015.60  

55 For more information on who is affected and on the methodology, please refer to Annexes III and IV.  
56  Secondary  impacts  are  not  considered  in  the  final  comparison  in  recognition  of  the  limitations  of  the  data  available  to  conduct  this 
assessment 
57 In case C-218/00, CISAL, EU:C:2002:36, the Court decided that public social security institutions cannot be regarded as  
economic undertakings within the meaning of Articles 102 and 102 TFEU. 

58 Impact on the climate, air quality, water quality and resources, biodiversity, soil quality and resources and waste production  
and recycling. 
59 For a detailed description of the analytical models and the methodologies used in each studies, please refer to Annexes V-XIX,  
and XXVI. 
60 Annex XXVI. 

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It  should  be  noted  that  some  statistical  analysis  is  based  on  citizenship  (Labour  force  survey)  and 
therefore  identify  EU  mobile  citizens/workers  (those  living/working  in  another  country  than  their 
country of citizenship) – while other data (administrative data collection) are based on headcounts of 
case where citizenship is not collected and that therefore constitutes a broader definition of mobility, 
i.e.  includes  not  only  EU  mobile  citizens/workers  but  also  nationals  returning  to  their  country  of 
citizenship as well as third-country nationals moving between EU Member States. In light of this, the 
Impact assessment adopts a broad definition of mobility which takes into account that in addition to 
EU  mobile  citizens  other  groups  also  benefit  from  coordination.  In  addition,  as  there  is  no  precise 
statistical  data  on  the  number  of  frontier  workers  within  the  legal  meaning  of  the  coordination 
Regulations,  it  has  been  assumed  for  statistical  purposes  that  all  cross-border  workers  residing  in  a 
neighbouring country are frontier workers.  

Since  quantitative  analyses  have  been  mainly  based  on  administrative  data  provided  by  Member 
States, it has to be underlined that not all Member States were able to provide data on the different 
benefits, nor was all data complete.  

When reliable quantitative information on the total impact of the proposed initiative was not available, 
the  analysis  has  been  based  on  a  qualitative  assessment  and  structured  interviews  conducted  with 
officials in representative Member States. Any limitations to this data are highlighted in the relevant 
chapter.  

An overview of the analytical models used for the impact assessment is provided in Annex IV. 

2.4. 

Stakeholder feedback 

As the preparatory work for the "Revision of Regulation (EC) No 883/2004 and Regulation (EC) No 
987/2010" began in 2009, stakeholders were consulted on several occasions on the different elements 
which were considered in the impact assessment:  

1.  Member  States  were  consulted  on  coordination  of  long-term  care  benefits,  export  of 
unemployment  benefits,  aggregation  of  unemployment  benefits,  coordination  of  unemployment 
benefits for frontier workers, export of family benefits and access to special non-contributory cash 
benefits  for  economically  inactive  persons,    within  the  framework  of  the  Administrative 
Commission. 

2.  National administrations were also consulted via a specialised online survey on the coordination 
of long-term care benefits, export of unemployment benefits and coordination of unemployment 
benefits for frontier workers. Also, a group of national organisation in charge of the payment of 
family benefits sent a position paper. 

3.  Social  partners  were  consulted  on  the  coordination  of  long-term  care  benefits,  coordination  of 
unemployment  benefits  for  frontier  workers  and  export  of  unemployment  benefits  in  the 
framework of the Advisory Committee for the Coordination of Social Security Systems, and on 
the coordination of family benefits, long-term care benefits, and unemployment benefits during a 
dedicated hearing. 

4.  NGOs  were  consulted  on  the  coordination  of  family  benefits,  long-term  care  benefits,  and 

unemployment benefits during an ad-hoc consultation workshop. 

5.  Two online consultations were also launched, one on the coordination of long-term care benefits, 
export of unemployment benefits and coordination of unemployment benefits for frontier workers 
which took place between December 2012 and February 2013; the other one on the coordination 
of unemployment benefits and the coordination of family benefits which took place between July 
and October 2015.   

It has to be noted that the different consultations presented different degrees of specifity in relation to 
the options assessed, and due to the high level of complexity of some topics, and the late definition of 
some  options,  some  consultations  have  been  kept  very  wide  (e.g.  the  public  consultation  on 
aggregation  of  unemployment  benefits;  export  of  family  benefits  and  social  security  coordination 
rules on the posting of employed and self-employed persons). The views of different stakeholders are 

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presented in the assessment of each option, a more detailed description of the consultation process is 
included in Annex II. 

2.5. 

Definitions 

Throughout  the  report,  reference  is  made  to  the  “competent  Member  State”,  “Member  State  of 
residence”,  "Member  State  of  last  activity",  “insured  persons”,  “frontier  workers”,  “cross-border 
workers”, "mobile EU workers" meaning the following within the framework of Regulation (EC) No 
883/200461: 

•  "Member  State"  –  Regulations  (EC)  Nos  883/2004  and  987/2009  apply  to  all  countries  within 
the EEA and Switzerland.  Within this report, the term "Member State" is sometimes used 
to  refer  not  only  apply  to  EU-28  States  but  also  Iceland,  Liechtenstein,  Norway  and 
Switzerland. 

•  “competent  Member  State”:  Member  State  in  which  the  institution  with  which  the  person  is 

insured is located, or the institution paying the social security benefit; 

•  “Member State of residence”: Member State where the institution which is competent to provide 

benefits in the place where the person resides is located; 

•  "Member  State  of  last  activity":  Member  State  where  an  unemployed  person  was  most  recently 

working before becoming unemployed 

•  “insured person” any person satisfying the national legal conditions to have the right to benefits, 

taking into account the provisions of this Regulation; 

•  “cross-border worker”: a person who resides in another Member State than the State of activity as 

an employed or self-employed person. This can be divided into two subsets: 

•  (i) “frontier worker”: any person pursuing an activity as an employed or self-employed person 
in a Member State and who resides in another Member State to which he/she returns as a rule 
on  a  daily  or  weekly  basis.  These  States  need  not  be  neighbouring  countries.  A  person 
working in Finland who returns every week on Friday evening to his/her home in Portugal is 
a frontier worker. Distance is irrelevant; 

•  (ii)“other  cross-border  worker”:  a  cross-border  worker  who  is  not  a  frontier  worker  in  the 
legal  sense  because  he/she  does  not  return  to  the  Member  State  of  residence  on  a  daily  or 
weekly basis; 

•  "Mobile EU worker": a worker who has moved his work or place of residence to another Member 

State.” 

3.  Why should the EU act? 

Social security coordination concerns cross-border situations where no Member State can act alone. 
Coordination measures at EU level in the field of social security are required by Article 48 TFEU and 
necessary to guarantee that the right to free movement can be exercised. Without such coordination, 
free movement may be hindered, since people would be less likely to move if it meant losing social 
security rights acquired in another Member State.  

The EU coordinating legislation replaces the numerous pre-existing bilateral agreements. The creation 
of an EU framework in this field ensures a uniform interpretation and protection of rights of mobile 
EU  citizens  and  their  family  members  that  could  not  be  achieved  by  the  Member  States  alone  at 
national level since this could potentially conflict with the Regulations.  

61 See Annex XIII for the full glossary of terms. 

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This  not  only  simplifies  social  security  coordination  for  Member  States,  but  also  ensures  equal 
treatment  of  EU  citizens  who  are  insured  in  accordance  with  national  social  security  legislation.An 
effective  and  efficient  coordination  system  at  EU  level  requires  that  it  takes  account  of  changes  in 
Member States' national social security legislation and keeps track with changes in social reality that 
affect  the  coordination  of  social  security  systems  to  achieve  a  fair  and  just  distribution  of  financial 
burden between Member States. Taking action at EU level aims to ensure a uniform interpretation and 
creates a common basis that applies to all Member States. Conversely, without such an update of the 
Regulations the financial and administrative burdens would be likely to be greater, as the provisions 
would not meet changing needs of the Member States. 

4.  Long-term care benefits 

4.1. 

Current Coordination Rules for Long-term Care Benefits 

According to the OECD definition, long-term care benefits are  a  holistic type of benefits that bring 
together a range of services for persons who are dependent on help with basic activities of daily living 
over an extended period of time. Such benefits can be provided in kind or in cash. Examples include 
allowances (of a fixed or differential amount) to compensate for the additional expenditure resulting 
from the recipients’ condition of reliance on care (cash benefits) or the provision, direct payment or 
reimbursement  of  the  costs  of  home  care  services,  specialised  home  adaptations  or  equipment 
(benefits in kind).  

Under  the  EU  coordination  rules,  long-term  care  benefits  are  mentioned  by  Regulation  (EC)  No 
883/2004  at  several  occasions.  However,  these  benefits  have  so  far  not  been  expressly  defined,  nor 
coordinated within the scope of Regulation (EC) No 883/2004 (leaving aside the clarification in Art. 1 
(va)  that  also  long-term  care  benefits  in  kind  have  to  be  regarded  as  benefits  in  kind  for  the 
application of the sickness chapter).  

The Court of Justice considered that long-term care benefits for the purposes of Regulation (EC) No 
883/2004 are benefits intended to improve the state of health and quality of life of persons reliant on 
care and as such, are intended to supplement sickness insurance benefits (irrespective of classification 
under  national  law).  If  these  benefits  are  granted  on  the  basis  of  an  objective  and  legally  defined 
position  (i.e.  in  a  non-discretionary  way),  they  are  covered  by  the  Regulation.  As  a  rule,  long-term 
care benefits are designed to promote the independence of persons reliant on care, in particular from 
the  financial  point  of  view.  Typically,  they  promote  home  care  in  preference  to  care  provided  in 
hospital but also consist of grants, aids or subsidies for people staying in residential care facilities. 

The  conditions  for  the  grant  of  the  benefit  or  the  underlying  method  of  financing  do  not  affect  the 
classification of a benefit. The fact that a benefit is non-contributory or that its grant is not linked to 
payment of a sickness insurance benefit, is according to the Court, of irrelevant to its classification as 
a long-term care benefit.  

In the absence of a comprehensive and coherent coordination regime well suited to the particularities 
of long-term care benefits, the Court has consequently decided that long-term care benefits should be 
coordinated  in  line  with  the  coordination  rules  applicable  to  sickness  benefits.62  According  to  these 
rules,  long-term  care  benefits  in  kind  are  to  be  provided  by  the  Member  State  of  residence  and 
reimbursed by the competent Member State. Long-term care benefits in cash are to be provided and 
paid by the competent Member State, including export to entitled persons residing in another Member 
State.  Residence  for  social  security  purposes,  according  coordination  Regulations,  means  the  place 
where  the  person  habitually  resides.  Competence  of  a  Member  State  is  established  according  to  the 
conflict  rules  laid  down  in  these  Regulations.  In  line  with  these  rules,  the  Member  State  where  a 
person works is responsible for sickness benefits even if the person resides in another Member State. 

62 Such clarifications are made by the Court on a case-by-case basis. At least 11 such cases were dealt with by the Court since the first time 
in 1998,  most of them concerning Germany, Austria and the United Kingdom, whose legislation provided for benefits having features of 
long-term care benefits. 

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For  pensioners,  it  is  the  State  primarily  responsible  for  their  pension  that  is  competent  for  sickness 
benefits, even if they reside in another Member State. Family members of these categories of persons 
are also covered by the said rules. 
Regulation  (EC)  No  883/2004  also  contains  an  anti-overlapping  provision63  which  applies  in 
situations  where  a  person  receives  long-term  care  benefits  in  kind  from  the  State  of  residence  and 
long-term care benefits in cash from competent Member State and both benefits are intended for the 
same purpose. The benefits in cash have priority over the benefits in kind and the competent Member 
State will deduct from the benefits in cash the amount for which it reimburses the State of residence 
for the long-term care benefits in kind.  

4.2. 

Problems with the coordination of long-term care benefits  

Lack of clarity for citizens and institutions 

There  is  a  low  level  of  understanding  of  the  coordination  rules  for  the  recipients  of  long  term  care 
benefits leading to confusion for both citizens and competent institutions.  

Slightly more than 80% of the individual respondents to the EU  Public Consultation claimed either 
not  to  know  (44%)  or  to  have  only  a  vague  idea  (38%)  about  the  current  rules  on  care  benefits  for 
elderly and/or disabled persons when moving within the EU. These figures contrast with the 18% of 
individuals  who  claimed  to  know  the  current  rules.  In  addition,  almost  57%  of  the  participants 
declared that they did not know in which country they could apply for long-term care benefits if they 
or their family members would be in need of them. 16% of the individuals were not even aware of the 
possibility to apply for long-term care benefits while living outside the Member State in which one is 
insured.  Moreover,  24%  of  the  respondents  replying  on  behalf  of  organisations  (national 
administrations, social partners and trade unions, civil society and NGOs and private companies) were 
of the view that intra-EU migrants are not sufficiently aware of their rights.  

A  driver  behind  this  problem  is  a  lack  of  common  definition  or  criteria  to  identify  long-term  care 
benefits  as  a  relatively  new  strand  of  social  security  rights.  During  the  final  years  of  the  twentieth 
century  Member  States  have  invested  in  the  design  of  special  schemes  for  persons  in  need  of  care. 

63 Article 34 of Regulation (EC) No 883/2004. 

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The  main  purpose  of  these  new  schemes  was  to  help  the  ageing  population  for  which  traditional 
assistance from other family members was no longer readily available.  

An additional driver is that at the national level, long-term care benefits are very diverse, either based 
on  insurance  legislation  (Belgium,  France,  Austria,  Germany,  the  Netherlands,  Luxembourg,  Spain, 
Portugal,  Italy,  Greece)  or  on  residence  legislation  (Sweden,  Denmark,  Finland,  United  Kingdom, 
Ireland), some being universal (Nordic countries, the United Kingdom), while others are not (Estonia, 
Latvia,  Lithuania,  Poland,  Czech  Republic,  Hungary,  Slovakia,  Romania,  Bulgaria,  Croatia)64. 
Benefits having characteristics of the long-term care benefits can be divided over several branches of 
social  security  in  some  Member  States,  whereas  in  others  separate  legislation  specific  to  long-term 
care exists. This may lead to difficulties when more than one country is involved65.  

This lack of clarity has direct consequences for EU citizens who have or wish to exercise their right to 
free movement, especially those who are vulnerable in light of their need for long-term care.  

Lack of clarity in legal framework for long-term care benefits 

While  it  is  clear  that  sickness  benefits  are  traditionally  intended  to  improve  the  state  of  health  and 
invalidity schemes are traditionally intended to compensate for the loss of income due to invalidity, 
there is not one and the same principle that applies to long-term care benefits. Although coordinated 
as  sickness  benefits,  long-term  care  benefits  still  have  a  number  of  distinctive  features  which 
differentiate  them  from  traditional  sickness  benefits.  In  particular,  they  are  typically  awarded  for  a 
longer period of time than sickness benefits and may also have the purpose of compensating for loss 
of income or other social risks faced by the claimant. This leads to lack of a common understanding at 
EU level of what long-term care benefits are and how they should be coordinated, which can lead to 
different outcomes for citizens and competent institutions. In the past three years (mid-2012 – mid-
2015), the Commission services received around 450 complaints or queries related to problems linked 
to coordination of sickness and long-term care benefits. This shows that the current ad-hoc system of 
coordination is an ongoing source of uncertainty.  

Drivers behind this problem may be identified as the lack of a common definition or common criteria 
to identify long-term care benefits, which, when recognizing the wide variety of different models of 
long-term  care  provision  between  the  Member  States,  results  in  a  disparate  approach.  Not  all  the 
benefits that correspond to the identified common characteristics at EU level are recognised as long-
term care benefits by the Member States. For instance, Greece, Italy, Portugal, Romania and Slovakia 
have indicated that they do not have any long-term care benefits which fall in the scope of Regulation 
(EC) No 883/2004, while information available shows that such benefits exist in these countries. Also, 
Member States apply differing definitions in their national legislation, if they have a definition at all. 
Bulgaria, Greece, Malta,  Norway, Romania, Slovakia and the United Kingdom do not have in their 
national  law  a  definition  of  long-term  care  benefits.  This  does  not  mean  that  no  long-term  care 
benefits exist, but that the benefits might be related to other social insurance risks, such as invalidity 
or old age. 66 

A further driver may be regarded as the "ad-hoc" system of coordination of long-term care benefits, 
which is not always applied consistently either by national authorities or the Court. In its recent case-
law67,  the  Court  acknowledged  that  long-term  care  benefits  may  have  characteristics  of  invalidity 
benefits  and  old-age  pensions.  The  Court  may  continue  connecting  long-term  care  benefits  to  other 
social security risks than sickness, depending on the individual characteristics of the benefits. Such an 

64 For an overview of the welfare systems, see page 18 of Annex V. 
65 For example, some Member States, like Spain, consider a specific financial guarantee for persons in need of nursing care as independent 
long-term care benefit, whereas in France it is paid as a supplement to the pension. 
66Austria,  France,  Finland,  Hungary,  Italy,  Latvia,  Lithuania,  Poland,  Slovenia,  Slovakia,  Sweden  referred  to  the  relationship  with  other 
branches of social security in the questionnaire on long-term care benefits carried out by the trESS Network for the purpose of Analytical 
Study 2012. 

67 Case 388/09, Da Silva Martins, EU:C:2011:439, p. 48, Case C-503/09, Lucy Stewart, EU:C:2011:500. 

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ad-hoc  coordination  system  contributes  to  legal  uncertainty,  inconsistent  approaches  by  national 
institutions and unpredictable outcomes for citizens.  

In  a  survey  of  stakeholders,  the  lack  of  a  uniform  application  and  understanding  of  EU  law  by 
Member  States  and  the  lack  of  awareness  among  mobile  citizens  were  identified  as  significant 
problems68. The authorities69 confirmed that poor coordination and disputes follow from the lack of 
consensus concerning the treatment of long-term care benefits across the Member States. The general 
view  shared  by  these  authorities  is  that  the  system  is  unclear,  administratively  burdensome  and 
unstable.  

The  lack  of  legal  clarity  over  classification  of  these  benefits  and  their  coordination  increases  the 
likelihood of infringement proceedings and leaves it up to the Court to decide on a case-by-case, and 
fragmented, basis which national benefits are to be considered a long-term care benefit. Moreover, the 
Court  only  has  the  option  of  applying  the  existing  coordination  principles  when  categorising  new 
benefits and thus categorising them with the benefits which they seem to resemble  most closely. In 
these  circumstances,  the  Court  has  determined  in  its  case  law  a  distinction  between  long-term  care 
benefits in cash and sickness benefits within the strict sense70. It is likely that the Court will continue 
its reasoning on that basis, and by connecting the long-term care benefits to other social security risks 
on a case-by-case basis, which will not be helpful to come to a common understanding of long-term 
care benefits.  

This  can  have  a  number  of  adverse  consequences  for  the  potential  users  of  these  benefits.    For 
example, there may be difficulties in applying some of the traditional coordination mechanisms, such 
as  the  aggregation  of  periods71,  the  prevention  of  overlapping72,  the  priority  rules  in  case  there  is  a 
concurrent right from two Member States73 or the rules to provide supplements if a person would have 
been entitled to a higher benefit from the State of insurance.74 

While successful infringement procedures may lead to a change in the legislation or national general 
practices,  such  successes  are  on  a  case  by  case  basis  and  the  advantages  for  individual  citizens  are 
limited,  as  the  specific  effects  for  them  have  to  be  established  by  national  courts.  Furthermore, 
infringement procedures may take a long time. In case of non-compliance, the case will be referred to 
the Court and the rights of EU citizens will still be on hold. 

Possibility of losing benefits, or double payments 

There is a risk that a person may lose out on long-term care benefits if they are not properly classified 
and  coordinated.  Another,  more  far-reaching  situation  is  the  one  in  which  a  person  receives  neither 
benefits  in  cash  or  kind,  as  he  or  she  moved  from  a  State  that  only  has  benefits  in  kind  (=  non 
exportable), to a State which only has benefits in cash to the detriment of the fundamental rights of the 
person concerned.  

68 Online consultation carried out among public authorities by Deloitte Consulting in 2012. 
69  Twenty-two  replies  were  received  from  public  authorities  in  Belgium,  Bulgaria,  Cyprus,  Denmark,  Finland,  France,  Greece,  Hungary, 

Iceland, Ireland, Liechtenstein, Norway, Portugal, Romania, Switzerland and United Kingdom. See Annex II. 

70 Case C-388/09 da Silva Martins, EU:C:2011:439. 
71 If the entitlement to long-term care benefits is dependent on the completion of periods, equivalent periods fulfilled in another Member 

State should be taken into account if necessary for the opening of the right to long-term care benefits. 

72  Long-term care benefits differ from country to country. They could be paid in the form of a monthly allowance to persons, or take the 
form of benefits in kind. In cross-border situations, there is a risk of accumulating benefits in cash and in kind from different Member 
States.  If  a  person  is  entitled  to  benefits  in  cash  from  the  competent  Member  State  and  at  the  same  time  can  claim  benefits  in  kind 
intended  for  the  same  purpose  from  the  Member  State  of  residence  or  stay  that  will  have  to  be  reimbursed  by  the  competent  Member 
State, the amount of the benefits in cash shall be reduced by the amount of the benefit in kind which could be claimed from the competent 
Member State. 

73 Family members of insured persons can have a derived right to sickness benefits from the family member, or an independent right in the 
Member State of residence, e.g. on the basis of their residence there. It is laid down in Article 32 of Regulation (EC) No 883/2004 that an 
independent right shall take priority over a derivative rights, except where the independent right in the Member State of residence exists 
directly and solely on the basis of the residence in that State. 

74In cases where the reimbursement of costs incurred on the benefits in kind provided in the State of stay, calculated under the rules in force 
in that State, is less than the amount which application of the legislation in force in the State of affiliation would afford, the competent 
institution,  upon  the  request  of  the  person  concerned,  will  reimburse  him/her  the  difference,  within  the  limits  of  the  costs  actually 
incurred. 

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As with the problem above, the drivers behind this problem are the lack of a common definition or 
common  criteria  to  identify  long-term  care  benefits,  which  when  recognizing  the  wide  variety  of 
different  models  of  long-term  care  provision  between  the  Member  States  results  in  a  disparate 
approach.  To  distinguish  between  the  benefits  in  kind  and  in  cash,  the  Administrative  Commission 
prepared  a  simple  'yes/no'  list  without  any  further  description  of  these  benefits75.  In  such  a  list  for 
long-term care benefits, 11 Member States have declared that they do not have cash benefits. Another 
10  Member  States  have  said  that  they  do  not  have  benefits  in  kind.    These  declarations  appear 
inconsistent with the Commission's own research. 

The current "yes/no" list for long-term care benefits has proved to be inadequate. The user percentage 
of long-term care benefits in cash is only equal to zero in Belgium, Bulgaria, Ireland, Hungary and the 
Netherlands76. Also, all Member States have benefits in kind and in cash that can qualify as 'long-term 
care benefits'77.  

Solely listing benefits by means of a yes/no list may have the consequence that a mobile citizen may 
either  lose  rights  or  alternatively  lead  to  a  duplication  of  rights  leading  to  inefficient  allocation  of 
welfare budgets between Member States. The current anti-overlapping provision in Regulation (EC) 
No 883/2004 deals with the situation where a person receives long-term care benefits in kind from the 
State of residence and long-term care benefits in cash from competent Member State and both benefits 
are 'intended for the same purpose'. However, the current system makes it difficult for Member States 
to be clear over whether two benefits are ‘provided for the same purpose’. In particular, a competent 
Member State providing long-term care benefits in cash is unable to verify whether or not the person 
in receipt of sickness benefits in kind from the State of residence for the same purpose and the same 
time  period;  this  would  only  reveal  itself  when  the  competent  Member  States  receives  a  claim  for 
reimbursement from the Member State of residence which normally happens only annually. In cases 
of  overlap,  the  competent  Member  State  is  effectively  taking  on  extra  information  obligations  to 
process claims for something that a person is already receiving. 

Example  illustrating  the  risk  of  double  payments:  an  Austrian  pensioner  with  long-term  care 
needs  moves  to  Germany  after  his  retirement.    He  receives  a  full  Austrian  pension  (and  has  no 
pension  entitlement  from  Germany  or  any  other  Member  State).  In  accordance  with  the  rules  of 
Regulation  (EC)  No  883/2004,  Austria  is  the  'competent  Member  State'  for  providing  long-term 
care benefits in cash. Consequently, Austria has to export care allowances in cash, for example, a 
cash benefit intended to cover the costs of a home  carer. The  German system also provides care 
benefits  in  kind  which  can  be  claimed  by  the  pensioner,  such  as  trained  carers  who  visit  elderly 
persons to provide assistance their home.  

Austria will reimburse the costs for the benefits in kind provided by Germany. The Austrian care 
allowance might no longer be necessary as the person already receives home care in Germany. It is 
therefore  necessary  for  the  Member  State  to  compare,  in  line  with  the  anti-overlapping  rule,  the 
two  benefits  to  determine  if  they  are  intended  for  the  same  purpose  and  are  paid  for  the  same 
period of time in order to prevent double-payments.  

For  instance,  in  2012,  2570  persons  exported  Pflegegeld  from  Austria  to  another  Member  State 
(Table  75  in  Annex  V),  of  which  70%  of  this  long-term  care  benefit  in  cash  was  exported  to 
Germany.  This  is  an  important  share,  which  makes  the  comparison  with  the  benefits  in  kind  in 
Germany even more relevant. 

It is noticed that the existing anti-accumulation rules at Article 34 are not working effectively in 
this regard. 

75 See ‘list of cash benefits and benefits in kind as referred to in Article 34 of Regulation (EC) No. 883/2004.’  
(http://ec.europa.eu/social/main.jsp?catId=868&langId=en), state of play for EU-27 in May 2010, and the MISSOC tables. 
76 See the 2015 Ageing Report. Table 25 in Annex XXVI. Moreover, based on the 2012 Ageing Report none of the countries showed a user 

percentage equal to zero. 

77 See the mapping of systems of long-term care benefits in Annex XXI. 

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4.3. 

Baseline scenario 

In total, there are 1.8  million persons covered by the Regulation who live in another Member State 
than the one in which they are insured against sickness. Out of them, 45.000 mobile citizens use long-
term care benefits in kind and 35.000 mobile citizens use cash long-term care benefits78. 

The demographic changes in the EU (ageing population) and national legislative developments (new 
types of benefits) are drivers for Member States to continue developing special schemes for persons in 
need of care. On the basis of the demographic projections79, the effect of ageing itself is expected to 
result  in  an  increase  of  need  for  long-term  care  and  of  public  spending  on  long-term  care  benefits 
from 1.6% of GDP in 2013 to 1.8 % of GDP in 2020 and 2.0% of GDP in 2030. The budgetary impact 
of the baseline scenario in 2013 is of 792.796.846 EUR80. 

The  differences  in  the  concept  of  long-term  care  benefits  and  their  treatment  across  Member  States 
can  undermine  the  effective  functioning  of  the  reimbursement  and  mechanism  of  deduction  for  the 
avoidance of double payments. In order to avoid the competent Member State reimbursing costs for 
benefits in kind that overlap with the benefits in cash that it provides directly to the person concerned, 
it is necessary to have a clear overview of benefits that are provided for the same purpose.The number 
of  cross-border  users  of  long-term  care  benefits,  who  are  today  80.000  (45.000 receiving  long-term 
care  benefits  in  kind  and  35.000  long-term  care  in  cash  )  might  increase  by  11%  in  2020  in 
comparison to 2013and by 28% in 203081.  

A lack of clear classification also limits the efficiency gains that might otherwise be foreseen by the 
launch of the Electronic Exchange for Social Security Information (EESSI) scheduled for launch by 
the end of 2016 with a deadline for full implementation in all Member State by the end of 2018 which 
will  introduce  common  structured  electronic  documents  and  a  uniform  procedure  for  all  national 
authorities  to  follow  when  processing  claims  social  security  benefits.82  In  the  absence  of  clear 
classification, EESSI will have limited potential to support national institutions to process long-term 
care benefits in a consistent and efficient manner.  

Furthermore,  non-action  increases  the  risk  of  loss  of  confidence  in  the  EU  rules  for  citizens  and 
institutions.  Keeping  the  current  framework  can  also  have  knock-on  effects  on  the  administrative 
costs  for  the  Member  States.  Finally,  it  might  also  imply  costs  for  citizens  seeking  to  enforce  their 
rights in a legally uncertain environment.  

4.4.  Objectives for coordination of long-term care benefits coordination rules 

As  with  all  elements  of  this  review  exercise,  the  general  policy  objective  of  this  initiative  is  to 
continue  the modernisation  of  the  EU  Social  Security  Coordination  Rules  by further  facilitating  the 
exercise  of  citizens'  rights  while  at  the  same  time  ensuring  legal  clarity,  a  fair  and  equitable 
distribution  of  the  financial  burden  among  the  institutions  of  the  Member  States  involved  and 
administrative simplicity and enforceability of the rules. 

In relation to long-term care in particular, this is reflected in the need to ensure coherence and clarity 
in  the  rules  applied  to  long-term  care  benefits  and  lay  down  a  stable  coordination  system,  while 
recognising  that  the  current  inconsistent  approach  by  Member  States  creates  legal  uncertainty  for 
citizens and national institutions and consequent difficulties in uniform application of these rules.  

78 See the synoptic overview in Annex III and table 2.18 in Annex XXVI. 
79 The total fertility rate (TFR) is projected to rise from 1.59 in 2013 to 1.68 by 2030 and further to 1.76 by 2060 for the EU as a whole. 
However, during the same period, the proportion of young people (aged 0-19) is projected to remain fairly constant by 2060, while the total 
age-dependency  ratio  (people  aged  below  20  and  aged  65  and  above  over  the  population  aged  20-64)  is  projected  to  rise  from  64.9%  to 
94.5%. European Commission: The 2015 Ageing Report: Economic and Budgetary Projections for the 28 EU Member States (2013-2060): 
Graph I.1.2. 
80 Estimate based on data LFS and 2015 Ageing Report. 
81 As follows from Table 27 in Annex XXVI. 
82Annex VI, p17.  

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In addition to the general objective, the specific objectives in the field of long-term care benefits are: 

(cid:190)  To  establish  a  stable  regime  appropriate  to  long-term  care  benefits  which  prevents  loss  of 

benefits and lays a basis for effective and efficient coordination; 

(cid:190) 

 To ensure a fair and equitable sharing of the financial burden between Member States: to 
prevent  double  payment  of  sickness  benefits  in  cash  and  ensure  that  the  financial  burden  for 
paying  long-term  care  benefits  to  persons  who  are  insured  in  the  competent  Member  State  are 
shared proportionally between that Member State and the State of residence.  

(cid:190)  To  bring  legal  clarity  and  transparency  for  citizens,  institutions  and  other  stakeholders  on 
coordination rules  applicable  to  them  so  that  they  are  ensured  what  the  citizens’  rights  to  long-
term care are when exercising their right to freedom of movement. 

4.5.  What  are  the  various  options  to  achieve  the  objectives  concerning  long-term  care 

benefits? 

A number of policy options have been identified to meet the objectives set out in Section 1.4. 

4.5.1  Option 0: Baseline scenario 

No  explicit  legal  framework  is  laid  down  in  the  coordination  Regulations  for  long-term  care. 
Following the interpretation given by the Court, the existing rules on sickness benefits apply to long-
term care benefits.  

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The Member States in their national legislations, or in case of disagreements, the Court, decide on a 
case-by-case basis which national benefits are to be considered as long-term care benefits. 

4.5.2 Option 1: The competent Member State provides long-term care benefits in cash and 
reimburses the cost of benefits in kind provided by the Member State of residence  

This option applies the existing rules on sickness benefits to long-term care benefits and complements 
them with some specific rules that take account of the characteristics of long-term care benefits.  

Similarly to sickness benefits, long-term care benefits in kind are to be provided by the Member State 
of residence in accordance with its legislation and reimbursed in full by the competent Member State. 
This  can  be  done  at  the  actual  or  at  fixed  level  of  expenses,  depending  on  the  national  system,  as 
shown in the accounts of the Member State of residence83.  

Long-term  care  benefits  in  cash  are  to  be  provided  and  paid  by  the  competent  Member  State  in 
accordance with its legislation, including to the entitled persons residing in another Member State. By 
agreement between the Member States, benefits in cash may, however, be provided by the Member 
State of residence at the expense of the competent State and in accordance with the legislation of the 
latter84. 

The  following  clarifications  distinguishing  the  long-term  care  area  from  the  sickness  rules  on 
coordination are also proposed:  

1) Inserting a new definition of long-term care benefits in Article 1 of Regulation (EC) No 883/2004 
that  takes  into  account  the  characteristics  of  long-term  care  benefits  and  facilitates  their  distinction 
from sickness benefits in a strict sense. Specifically, this could be accomplished by introducing a new 
chapter  in  the  Regulation  for  long-term  care  benefits,  based  on  the  same  principles  as  the  sickness 
chapter but allowing for the key distinctions between these two types of benefits. 

2) Defining the risk of 'long-term care' in Article 3(1) of Regulation (EC) No 883/2004 so it clearly 
falls as a distinct field of social security falling within the material scope of the EU rules; 

3)  Drawing  up  a  list  of  long-term  care  benefits  per  Member  State  that  covers  all  benefits  that  are 
included or  excluded  for  the  purposes  preventing double payment  of  long-term  care  benefits  by  the 
institutions.  This  should  be  possible  on  the  basis  of  the  common  elements  in  the  definition  and  the 
existing analysis of national systems.85  

4.5.3  Option 2: The Member State of residence provides all long-term care benefits with 
reimbursement by the competent Member State 

Under  this  option  the  State  of  residence  grants  long-term  care  benefits  in  cash  and  in  kind  as  they 
exist  under  its  national  system.  This  is  different  from  the  baseline  scenario,  under  which  the 
competent  Member  State  pays  the  long-term  care  cash  benefits  directly  to  the  insured  person.  By 
making only one Member State responsible for providing long-term care benefits in cash and in kind, 
the risk of overlapping or a total loss of benefits in kind is reduced.  

Similarly  to  sickness  benefits,  the  competent  Member  State  shall  reimburse  expenses  for  long-term 
care benefits in kind. This can be done at the actual or at fixed level of expenses, depending on the 
national  system,  as  shown  in  the  accounts  of  the  Member  State  of  residence.  An  additional 
reimbursement  procedure  for  long-term  care  benefits  in  cash  would  however  need  to  be  introduced 
between the Member States.  

The  situation  can  occur  where  the  level  of  the  long-term  care  benefits  in  the  State  of  residence  is 
lower  than  in  the  competent  Member  State.  The  two  sub-options  described  below  explore  the 
possibilities for offering more favourable treatment of the persons concerned, in particular by giving 
the best benefits from two countries. The sub-options are partly inspired by the coordination system 

83 See Articles 17 and 35 of Regulation (EC) No 883/2004. 
84 See Article 21(1) of Regulation (EC) No 883/2004. 
85 Annex XXI. 

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that applies to family benefits in Regulation (EC) No 883/2004. In the field of family benefits, if two 
rights coincide, the person is entitled to the highest amount that he/she is entitled to under either of the 
two systems (for more information see Chapter 7.1).  

4.5.3.1.  Sub-option  2a)  The  benefits  are  provided  at  the  level  of  the  Member  State  of  residence 
without a supplement by the competent Member State 

Under this sub-option, all long-term care benefits are provided by the Member State of residence at 
the  level  as  determined  by  its  legislation,  irrespective  of  where  the  person  is  insured.  The  person 
concerned will not receive a 'top-up' from the competent Member State; even its benefits are higher 
than those in the Member State of residence.  

4.5.3.2. Sub-option 2b) The benefits at the level of the Member State of residence are supplemented by 
the competent Member State  

Under sub-option 2b, the person receives a supplement from the competent Member State in the event 
that  the  benefits  in  the  Member  State  of  residence,  or  the  amount  of  reimbursement,  are  at  a  lower 
level than in the competent Member State. The 'top up' will be paid to the amount to which the person 
would  have  been  entitled  in  the  competent  Member  State  and  will  be  paid  directly  to  the  person 
concerned. 

A person is insured in Member State A and resides in Member State B, where he applies for home 
care. The home care services costs EUR 5.100 including a service user charge of EUR 1.100 paid 
for  by  the  insured  person.  The  amount  corresponding  to  the  level  of  cover  provided  by  the 
insurance  system  of  Member  State  B  is  EUR  4.000.  This  amount  is  paid  by  the  institution  of 
Member State B and is to be refunded by the institution of Member State A.  

But  if  the  level  of  cover  under  the  system  of  Member  State  A  is  higher,  e.g.  EUR  6.000,  the 
person will also be able to receive the actual costs incurred in terms of the service user charge of 
EUR 1.100 from Member State A. 

4.5.4 Discarded options 

Three options were considered but discarded from assessment: 

a) The introduction of a safeguarding provision 

The competent Member State would award the long-term care benefits in cash for persons who reside 
outside that Member State. In a situation where the legislation of the competent Member States does 
not provide for long-term care benefits in cash and at the same time benefits in kind are non-existent 
in  the  Member  State  of  residence,  the  Member  State  of  residence  should  grant  the  long-term  care 
benefits in cash existing under its legislation to avoid that a person is left with nothing. The competent 
Member State would then reimburse the benefits in cash provided by the Member State of residence.  

This option would be less clear than the baseline scenario and would give rise to a lot of uncertainties 
for  the  Member  State  of  residence  about  when  benefits  are  or  are  not  available  in  the  competent 
Member State86. Although the right to a benefit for the person concerned would be guaranteed, this 
option  does  not  provide  legal  certainty  about  when  the  Member  State  of  residence  would  provide 
benefits, what benefits would be concerned and what amount.  

b) Make the Member State of residence responsible for providing all long-term care benefits without 
reimbursement by the competent Member State 

86 The following sources supported the analysis: trESS Analytical Study 2012, Legal impact assessment for the revision of Regulation 
(EC)  No  883/2004  with  regard  to  the  coordination  of  long-term  care  benefits,  to  be  consulted  at: 
.http://www.tress-
network.org/tress2012/EUROPEAN%20RESOURCES/EUROPEANREPORT/trESS_Analytical%20Study%202012.pdf,  p.  37-40  and 
Deloitte, Consulting Study for the impact assessment for revision of Regulations (EC) Nos 883/2004 and 987/2009, 6 December 2013, 
pages. 130-13, Tables 53 and 54. The study can be found in Annex V to this report. 

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The Member State of residence would be competent for providing all the long-term care benefits, in 
cash  and  in  kind,  on  the  basis  of  its  own  legislation,  thereby  applying  its  own  conditions  for 
entitlement  and  granting  benefits  at  the  level  set  in  that  Member  State.  The  long-term  care  benefits 
would remain fully at the expense of the Member State of residence. 

Only  one  Member  State  is  involved  in  providing  long-term  care  benefits  and  this  will  make  the 
system administratively easier to handle. However, the Member State of residence will be faced with 
an increase in applications for long-term care benefits, both from persons who are not insured against 
sickness benefits in that Member State and who have not contributed to financing the system of long-
term  care  benefits  (e.g.  pensioners  who  are  covered  for  health  care  in  the  country  from  which  they 
receive  a  pension)  without  recourse  to  any  reimbursement.  Moreover,  the  system  could  provide  an 
incentive  to  move  to  a  country  with  more  'generous'  long-term  care  benefits.  This  option  would 
therefore put too great a burden on the administrative and financial organisation of the system of long-
term care benefits in the Member State of residence. 

c) Make the competent Member State responsible for providing all long-term care benefits to insured 
persons residing abroad (export). 

Under this option the competent Member State would become responsible for providing all long-term 
care  benefits  to  insured  persons  who  are  residing  abroad.  Where  benefits  are  only  available  in  the 
form of services, the competent Member State would reimburse the relevant services provided for in 
the Member State of residence according to the rates applicable in the Member State of residence. 

This option would introduce a slight improvement in the protection of rights of the person concerned, 
as  all  persons  in  need  of  long-term  care  will  be  treated  equally  in  the  competent  Member  State 
(=Member  State  of  insurance)  and  will  not  have  their  benefits  reduced  when  they  move  to  another 
Member  State.  However,  this  option  would  have  significant  practical  challenges,  including  the 
necessity of increased information exchange between Member States. The benefits in kind available 
in both countries would need to be compared to assess if the benefits in kind in the Member State of 
residence could be provided under the same conditions as the competent Member State. If no benefits 
in  kind  are  available  in  the  Member  State  of  residence  the  competent  Member  State  would  have  to 
'value'  these  benefits  in  cash.  In  all,  this  option  would  not  contribute  to  an  even  financial  burden 
sharing between Member States, and would make the system harder to administer for the competent 
Member State. 

4.6. 

Stakeholder Support 

4.6.1  Baseline Scenario 
In  discussions  in  the  Administrative  Commission87,  the  baseline  scenario  received  support  from  10 
delegations88;  two  delegations  explicitly  opposed  the  option89.  In  the  stakeholders’  EU  public 
consultation90 this option received support corresponding to replies from 18% of individuals91, 17% of 
social partners92 and 12% of NGOs93. 

87  Discussions  took  place  in  meetings  of  the  Administrative  Commission  in  the  period  2009  to  2013.  A  Working  Party  dedicated  to  the 
revision  of  the  provisions  on  the  coordination  of  long-term  care  benefits  was  held  on  10  October  2013.  The  consultation  within  the 
Administrative Commission concerns a consultation at expert level. The views expressed at the level of the Administrative Commission do 
not necessarily represent the Government's view. 
88  Belgium,  Greece,  Spain,  Hungary,  Malta,  Poland,  Sweden,  Estonia  as  well  as  the  United  Kingdom  and  France  without  declaring  their 
definite position.  
89 Italy, Luxembourg. 
90 A public consultation between December 2012 and February 2013 invited citizens and organisations to provide their views on the main 
problems linked to the coordination of long-term care benefits. 
91 Out of 127 requested records relating to 6 different options considered. 
92 Out of 12 social partners providing responses relating to 6 options considered. 
93 Out of 8 NGOs providing responses relating to 6 options considered. 

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 Option 1: The competent Member State provides long-term care benefits in cash and 

4.6.2 
reimburses the cost of benefits in kind provided by the Member State of residence 

Option 1 gained the most support from the delegations in the Administrative Commission, whereby 
12 delegations explicitly supported this option, seven other Member States did not object its elements 
without taking definite position and none of the Member States declared to be against94. Although the 
opinions differed as regards their exact design, all delegations recognised the importance and the need 
to  have  a  definition  and  a  list  of  long-term  care  benefits.  The  outcome  of  the  public  consultation 
provided  for  the  same  result  as  the  baseline  scenario  as  the  consultation  did  not  make  distinction 
between it and option 1.  

4.6.3  Option  2:  The  Member  State  of  residence  provides  all  long-term  care  benefits  with 
reimbursement by the competent Member State 

Option 2 did not receive explicit support from any delegation in the Administrative Commission, four 
Member States being against95. The complexity and the administrative burden of supplement system 
is generally the main reason for the low support for this option among national public authorities. One 
of the comments was that when the system of providing long-term care benefits is decentralised and 
local municipalities are responsible for providing long-term care benefits, this option will be difficult 
to implement96. In the stakeholders’ consultation option 2a) received support corresponding to replies 
from 19% of individuals, 17% of social partners and 50% of NGOs, while option 2b) was supported 
by 6% of individuals, 25% of social partners and none of the NGOs. 

4.6.4  Discarded options 

Although  delegations  in  the  Administrative  Commission  were  not  explicitly  consulted  on  the 
discarded options, the discussion was not limited to the selected options and possibility was given to 
present any additional ideas. None of the delegations supported any of the discarded options. 
In the public consultation97, option a) received support from 14% of individuals, 8% of social partners 
and 12% of NGOs, option b) was supported by 19% of individuals, 17% of social partners and 50% of 
NGOs98 and option c) received support from 38% of individuals, 33% of social partners and 25% of 
NGOs. 

4.7.  What are the Impacts of the Different Options?  

For  all  of  the  options  assessed,  the  potentially  affected  groups  are  the  same.  The  options  are 
specifically  targeted  at  cross-border  workers,  retired  former  cross-border  workers,  other  mobile 
pensioners and the family members of the said categories of entitled persons. 

The fact there is no specific coordination regime and a common definition, made it difficult to collect 
data on long-term care benefits as limited data exists at national level. Administrative data on long-
term  care  benefits  are  only  available  in  specific  forms  dealing  with  the  coordination  rules  of  the 
sickness chapter. 

data 
For the purposes of assessing the impact, two types of data sources were used:  
(available  literature  and  reports  at  EU  and  Member  States’  level,  particularly  the  trESS  network 
reports;  replies  to  the  online  public  EU  Consultation  on  the  need  to  revise  of  the  current  rules; 
available  statistical  data  with  regard  to  mobility  patterns  and  the  use  of  long-term  care  benefits  in 
cross-border  cases)  and  primary  data,  collected  through  interviews  and  a  consultation  of  the 

secondary 

94  Luxembourg,  Spain,  Italy,  Portugal,  Lithuania,  Poland,  Belgium,  Malta,  Sweden,  Czech  Republic,  Hungary  and  Latvia  explicitly 
supported the option, whilst Austria, Germany, France, Ireland, Slovenia, Slovakia and Greece, without taking definite position, supported 
some elements of this option or did not object it.  
95 Belgium, Germany, France and Sweden. 
96  In  Sweden  for  example,  290  municipalities  in  the  future  would  also  need  to  provide  long-term  care  benefits  in  cash  and  set  up  a 
reimbursement mechanism. 
97 A public consultation between December 2012 and February 2013 invited citizens and organisations to provide their views on  
the main problems linked to the coordination of long-term care benefits. 
98 The results are identical to those for option 2a, as no distinction was made in the public consultation as to responsibility for reimbursement 
of the cost of the benefits provided by the Member State of residence. 

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29 

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stakeholders (findings from strategic interviews with Commission officials; findings from interviews 
with  stakeholders  at  EU  level,  e.g.  European  umbrella  organisations;  findings  form  interviews  with 
key stakeholders at national level (health insurers, healthcare providers); replies to the EU-wide web-
based  survey  among  responsible  public  authorities;  new,  generated  statistical  data  with  regard  to 
mobility patterns and the  use of long-term  care benefits in cross-border cases; findings from the 13 
workshops/group  interviews  and  8  phone  interviews  on  the  administrative  costs  and  administrative 
burden related to the policy options). 

For 

further 

information 

about 

the  methodology 

see 

section  2.3 

and  Annex 

IV.

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30 

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The Table below illustrates a summary of impacts of the different options: 

Type of 
impact 

Clarification  Simplification  Protection 

of rights 

Fundamental 
rights 

Economic 
impacts 

Regulatory 
costs 

Risk 
of 
fraud 
and 
abuse 

Equitable 
burden 
sharing 
Member 
State 

Coherence 
with EU 
objectives 

Overall 
Effectiveness 

Overall 
Efficiency 

(cost vs 
effectiveness) 

Baseline 
Scenario 

Option 1 

Option 
2a 

Option 
2b 

0 

++ 

++ 

+ 

0 

+ 

+ 

-- 

0 

+ 

+/- 

++ 

0 

+ 

+/- 

+ 

099 

0 

+ 

-- 

0 

0 

- 

-- 

0 

+ 

- 

- 

0 

0 

+/- 

+/- 

0 

+ 

+ 

+ 

0 

++ 

+ 

- 

0 

+ 

+ 

- 

99 The budgetary impact of the baseline scenario in 2013 has been estimated at 792.79 million euros. This is an estimate based on LFS data and the 2015 Ageing Report. 

EN 

31 

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The following Tables demonstrate specific impacts for each of the considered policy options: 

Policy Option 1:  The competent Member State provides long-term care benefits in cash and reimburses 
the cost of benefits in kind provided by the Member State of residence 

Social impacts 

Clarification 

Simplification 

Protection of rights 

++ 

+ 

+ 

Financial impact 

0 

Impacts on fundamental rights 

+ 

into 

taking 

umbrella, 

This  option  will  coordinate  long-term  care  benefits  under  a 
separate 
specific 
characteristics.  The  creation of a  common  EU definition of  long-
term  care  benefits  and  a  concrete  list  of  the  benefits  is  an 
important  step  towards  more  clarity  and  a  uniform  approach  will 
lead  to  greater  clarity  and  a  uniform  approach,  while  preserving 
the method currently applied to sickness benefits. 

account 

their 

This  option  will  not  fundamentally  change  the  principles  of  the 
baseline as regards the differences between benefits in kind and in 
cash.  However,  the  proposed  option  will  make  it  easier  for 
Member  States  and  citizens 
the 
coordination  provisions  on  national  long-term  care  benefits.  The 
option  also  offers  a  greater  stability  as  it  maintains  the  main 
principles currently applied under the baseline scenario. 

to  understand  and  apply 

This  option  will  contribute  to  expediting  the  process  by  which 
persons that require care receive the benefits by removing much of 
the  uncertainty  over  the  status  of  the  various  long-term  care 
benefits.  There  will  be  no  doubt  about  which  benefits  can  be 
claimed in a cross-border situation. Nevertheless, the actual receipt 
of  the  benefits  remains  dependent  on  the  distinction  between 
benefits in cash and in kind and the limitation that benefits in kind 
cannot be exported. Theoretically, an insured person could still be 
excluded  from  their  benefits,  for  example,  when  the  competent 
Member State only grants long-term care benefits in kind and the 
State of residence only has benefits in cash.  

This  option would  involve no  economic  impact  in  comparison  to 
the  baseline  scenario,  as  Member  States  will  continue  to  pay  the 
long-term  care  benefits  under  the  same  coordination  rules  as 
before.  The  impact  would  only  manifest  itself  if  benefits  that  are 
currently outside the scope of the existing rules would be included 
in  the  list.  For  detailed  budgetary  impact  for  individual  Member 
States see Tables 2.19-2.23 in Annex XXVI. 

This  option  will  contribute  to  a  smoother  application  of  the 
coordination  provisions  for  long-term  care  benefits  and  hence  to 
freedom of movement and residence (Article 45), and facilitate the 
access  to  social  security  and  social  assistance  (Article  34).  It 
would  ensure  that  citizens,  despite  any  vulnerability  or  care-need 
they might have, are not disadvantaged in exercising their right to 
free movement within the EU in accordance with the rights of the 
elderly (Article 25) and the integration of persons with disabilities 
(Article 26). There is no impact on the right of property, as rights 
acquired  under  the  national  legislation  of  the  competent  Member 
State  and  the  State  of  residence  are  maintained  on  the  same 
footing. 

Other impacts 

Regulatory Costs 

0 

The information obligations for institutions and citizens under this 
option  will  remain  the  same  as  under  the  baseline  scenario  as  no 

EN 

32 

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new  obligations  will  be  introduced.  The  option  facilitates  the 
comparison of benefits in kind and in cash and could lead to fewer 
disputes  between  institutions.  In  an  initial  phase  the  new  legal 
definition  may  increase  the  administrative  burden  for  Member 
States  and  impact  the  exchange  of  information  between  Member 
States.  In  the  long  term  the  clarification  would  save  time  and 
money  for  Member  States,  especially  in  light  of  increasing 
demand for long-term care benefits. 

In  general,  additional  clarifications  will  always  make  the  legal 
situation  clearer  for  the  persons  concerned  and  the  institutions  
Specifying the national benefits concerned will reduce the risk of 
overlapping payments.  

There  are  no  fundamental  changes  in  comparison  to  the  current 
situation.  Depending  on  the  definition  of  long-term  care  benefits 
and  the  benefits  to  be  included  in  the  list,  some  benefits  which 
would  currently  not  be  coordinated  under  the  Sickness  Chapter 
could be more or less beneficial for a Member State. 

This option, by introducing a legal basis for the already applicable 
rules, leads to stability of the already applied regime appropriate to 
long-term  care  benefits,  while  remaining  compatible  with  the 
system currently applied under the baseline scenario. In parallel, it 
achieves legal clarity and transparency on the rules applicable both 
for citizens and institutions as well as other stakeholders. Although 
benefits  in  kind  are  provided  by  the  residence  State,  costs  of  all 
cash  and  in  kind  benefits  provided  are  at  the  expense  of  the 
competent  Member  State  which  ensures  a  fair  distribution  of  the 
financial  burden.  This  option  however  will  not  solve  existing 
mismatches in case the competent Member State has no benefits in 
cash and the State of residence has no benefits in kind.  

Risk of fraud and abuse 

Fair  burden  sharing  between 
Member States 

+ 

0 

Coherence with General, Specific 
and wider EU Objectives: 

+ 

Continue  the  modernisation  of  the  EU 
Social  Security  Coordination  Rules  by 
further facilitating the exercise of citizens' 
rights  while  at  the  same  time  ensuring 
legal  clarity,  a 
fair  and  equitable 
distribution of the financial burden among 
the  institutions  of  the  Member  States 
involved  and  administrative  simplicity 
and enforceability of the rules. 

• 

• 

• 

stable 

Establish  a 
regime 
appropriate  to  long-term  care 
benefits; 

 Ensure  a  fair  and  equitable 
sharing of the financial burden 
between Member States; 

legal 

clarity 

and 
Bring 
citizens, 
transparency 
institutions 
other 
stakeholders  on  coordination 
rules applicable to them. 

for 
and 

Policy Option 2a: The benefits are provided by the Member State of residence without a supplement by 
the  competent  Member  State  even  if  the  benefits  in  the  Member  State  of  residence,  or  the  amount  of 
reimbursement, are at a lower level than in the competent Member State 

Social impacts 

Clarification 

++ 

Under  this option,  the  same  clarifying  measures  will  be provided 
as  under option  1 so  that  the  person  will  always  know  that  he  or 
she needs to claim the benefits under the legislation of the Member 
State  of  residence. There will  be no doubts  even  if  it  is  not  clear 
under the relevant legislation whether a certain benefit is a benefit 

EN 

33 

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Simplification 

+ 

Protection of rights 

+/- 

Financial impact 

+ 

Impacts on fundamental rights 

+/- 

in cash or in kind.  

Only one Member State is exclusively competent to provide long-
term  care  benefits  to  the  person  concerned.  Priority  rules  against 
overlapping will be superfluous, which will simplify the procedure 
for  mixed-type  systems  but  there  will  need  to  be  an  additional 
reimbursement procedure for cash benefits. 

This  option  would  ensure  that  the  persons  concerned  are  always 
protected  at  the  same  level  as  all  other  persons  in  the  Member 
State  of  residence.  Affiliation  to  the  system  of  the  State  of 
residence  needs  to  be  assimilated  in  cases  where  a  person  is  not 
covered by the legislation of the State of residence. This in itself 
can  be  seen  as  positive  in  comparison  to  the  baseline  scenario. 
However,  depending  on  the  system  or  level  of  long-term  care 
benefits in the Member State of residence, a person might be better 
or worse of in comparison to the level of benefits in the competent 
Member State as the level of protection will depend solely on the 
level of benefits in the residence State.  

Long-term care benefits in cash shall be provided by the State of 
residence  and  no  longer  by  the  competent  Member  State.  This 
implies a considerable decrease of the budget which is needed to 
finance  the  cross-border  use  of  long-term  care  benefits  in  cash 
(from € 203 Million to € 111 Million or a decrease of 45% (Annex 
XXVI– Tables 2.19 and 2.20)). The details of the estimates reveal 
that  whereas  more  persons  are  using  long-term  care  benefits  in 
cash,  the  average  amount  is  much  lower.  The  total  budgetary 
impact  is  estimated  at  €  701  million,  which  corresponds  to  a 
decrease  of  12%  in  comparison  to  the  baseline  scenario  (Annex 
XXVI – Tables 2.19 and 2.20).  

On the level of Member States an especially positive impact (less 
spending) is observed for Austria (decrease of 61% of expenditure 
on  long-term  care  benefits  in  comparison  to  now),  Italy  (-53%) 
and Czech Republic (-41%) (Annex XXVI – Table 2.20).  

Primarily, a negative impact (more spending) in comparison to the 
other options is observed for the Slovak Republic (increase of 75% 
of  expenditure  on  long-term  care  benefits  in  comparison  to  the 
baseline  scenario),  Croatia  (+66%)  and  Hungary  (+50%).  These 
countries have a rather low level of sickness benefits in cash. They 
also have a rather low user rate of long-term care benefits in their 
country. Under this option, Member States will have to reimburse 
benefits  in kind  and  in  cash provided  to persons who  are insured 
under  their  social  security  systems,  but  who  reside  in  another 
Member State where the level of long-term care benefits is higher.  
This  could  entail  paying  more  than  permitted  under  national 
legislation. 

Member  States  in  which  no  crucial  negative  or  positive  financial 
impact is observed are: Estonia, Luxembourg, Sweden, Denmark, 
Cyprus and France.  

For  detailed  budgetary  impact  for  individual  Member  States  see 
Tables 2.19-2.23 in Annex XXVI. 

The impact is the same as for option 1 however; the impact on the 
right of property will vary as depending on the system or level of 
long-term care benefits in the Member State of residence, a person 

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might be better or worse of in comparison to the level of benefits 
in the competent Member State. 

the  system  providing 

As  only  one  Member  State  is  competent  for  providing  long-term 
care  benefits,  this  option  does  not  require  further  implementing 
arrangements  or  priority  rules 
to  avoid  overlapping.  The 
competent Member State and the State of residence will however 
need  to  set  up  a  new  reimbursement  mechanism  for  benefits  in 
cash. This option may be difficult to implement in Member States 
where 
is 
decentralised.  The  State  of  residence  will  have  to  assume 
entitlement  for  benefits  in  cash  for  a  person  who  is  insured  in 
another Member State and will be confronted with an increase in 
cases  (from  45.000  to  80.000  per  year,  based  on  current 
estimations  of  recipients  of  cross-border  long-term  care  -  table 
2.18 - Annex XXVI). The administrative costs for long-term care 
are  expected  to  diminish  in  comparison  to  the  baseline  scenario, 
but the relative share of the regulatory costs in the total budget for 
long-term  care  could  increase  slightly  (combined  impact  for both 
benefits in cash and in kind - table 55 - Annex V). 

long-term  care  benefits 

The risk of fraud and abuse is slightly higher than in the baseline 
scenario.  Member  States  with  more  generous  long-term  care 
benefits  warned  that  this  option  could  lead  persons  to  move  to  a 
Member with a higher level of benefits and claim long-term care 
benefits  there.  This  in  itself  is  not  fraud  or  abuse,  but  it  can 
contribute to the perception of so-called 'opportunistic behaviour'. 

Both  the  competent  Member  State  and  the  Member  State  of 
residence  contribute  to  the  costs  of  granting  the  benefit  to  the 
person  concerned.  The  competent  Member  State  will  have  to 
reimburse  the  costs  made  in  the  Member  State  of  residence, 
according  to  the  level  of  the  State  of  residence  –  even  if  this  is 
higher  or  the  Member  State  of  residence  would  anyhow  provide 
the benefits on the basis of its national legislation. This may entail 
a  higher  or  lower  share  of  burden  depending  on  the  respective 
level of benefits in the Member States concerned.  

This  option  introduces  a  stable  regime  appropriate  to  long-term 
care  benefits.  The  regime  however  differs  from  the  currently 
applied rules and thus will require adaptation before full stability 
is  achieved.  In  parallel,  the  option  brings  legal  clarity  and 
transparency  on  the  rules  applicable  both  for  citizens  and 
institutions  as  well  as  other  stakeholders.  Although  the  overall 
costs  for  the  spending  on  long-term  care  benefits  in  cash  is 
decreased,  this  option  might  be  less  effective  at  achieving  the 
objective  of  a  fair  and  equitable  distribution  of  financial  burden 
between Member States as the costs are always reimbursed at the 
level  of  the  residence  State.  Also,  introducing  a  separate 
reimbursement  procedure  for  long-term  care  benefits  in  cash 
which will require setting up of a new system for the exchange of 
information  between  Member  States  will  entail  additional 
regulatory costs compared to the baseline scenario.  

Other impacts 

Regulatory Costs 

- 

Risk of fraud and abuse 

- 

Fair  burden  sharing  between 
Member States 

+/- 

Coherence with General, Specific 
and wider EU Objectives: 

+ 

Continue  the  modernisation  of  the  EU 
Social  Security  Coordination  Rules  by 
further facilitating the exercise of citizens' 
rights  while  at  the  same  time  ensuring 
legal  clarity,  a 
fair  and  equitable 
distribution of the financial burden among 
the  institutions  of  the  Member  States 
involved  and  administrative  simplicity 
and enforceability of the rules. 

• 

• 

• 

stable 

Establish  a 
regime 
appropriate  to  long-term  care 
benefits; 

 Ensure  a  fair  and  equitable 
sharing of the financial burden 
between Member States; 

legal 

clarity 

and 
Bring 
citizens, 
transparency 
institutions 
other 
stakeholders  on  coordination 

for 
and 

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rules applicable to them. 

Policy Option 2b: The competent Member State provides a supplement to the beneficiary in the event that 
the benefits in the Member State of residence, or the amount of reimbursement, are at a lower level than 
in the competent Member State 

Social impacts 

Clarification 

Simplification 

Protection of rights 

Financial impact 

+ 

-- 

++ 

-- 

Impacts on fundamental rights 

+ 

Under this option, the person will always know that he/she needs 
to claim the benefits under the legislation of the Member State of 
residence. However, the person may also need to introduce a claim 
for paying the supplement in the competent Member State, which 
can  only  be  done  after  the  initial  claim  has  been  paid  by  the 
Member State of residence.  

This option is more complex than the baseline scenario as it opens 
simultaneous entitlements under the legislation of several Member 
States. Priority rules will have to be drawn up and a procedure will 
need  to  be  developed  for  the  calculation  of  the  supplement  and 
how  the  supplements  shall  be  settled.100  Moreover,  the  option 
deviates from currently applied sickness logic which is consistent 
with the Court’s case-law. 

The social impact is the same as for option 1 and in addition the 
insured  person  will  always  receive  the  highest  benefit  to  which 
he/she  would  have  been  entitled  to  in  the  competent  Member 
State. 

It is estimated that the total expenditure for long-term care benefits 
would  increase  to  €  1.4  billion,  of  which  €  1.15  billion  is  for 
benefits in kind (an increase of 95% in comparison to the baseline 
scenario)  and  €  253  million  for  benefits  in  cash  (an  increase  of 
25%) (Annex XXVI – Table 2.24). The differences are caused by 
the supplement, which is estimated at € 560 million for long-term 
care benefits in kind and € 142 million for long-term care benefits 
in  cash  which  come  from  the  account  of  the  competent  Member 
State.  

This  option  has  no  positive  budgetary  impact  on  any  of  the 
Member States. The highest increase in comparison to the current 
scenario  is  estimated  to  take  place  in  Sweden  (+318%),  the 
Netherlands (+297%) and Finland (+ 248%). 

For  detailed  budgetary  impact  for  individual  Member  States  see 
Tables 2.19-2.23 in Annex XXVI. 

The impact is the same as for option 1 and in addition the insured 
person  will  always  receive  the  highest  benefit  to  which  he/she 
would have been entitled to in the competent Member State. 

100 It may not be possible to directly replicate the existing system for calculation of a differential supplement in the field of family  
benefits and still respond to the specifics of long-term care.. 

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Other impacts 

Regulatory Costs 

-- 

Risk of fraud and abuse 

- 

Fair  burden  sharing  between 
Member States 

+/- 

Coherence with General, Specific 
and wider EU Objectives: 

+ 

Continue  the  modernisation  of  the  EU 
Social  Security  Coordination  Rules  by 
further facilitating the exercise of citizens' 
rights  while  at  the  same  time  ensuring 
legal  clarity,  a 
fair  and  equitable 
distribution of the financial burden among 
the  institutions  of  the  Member  States 
involved and administrative simplicity and 
enforceability of the rules. 

• 

• 

• 

stable 

Establish  a 
regime 
appropriate  to  long-term  care 
benefits; 

 Ensure  a  fair  and  equitable 
sharing of the financial burden 
between Member States; 

legal 

clarity 

and 
Bring 
citizens, 
transparency 
institutions 
other 
stakeholders  on  coordination 
rules applicable to them. 

for 
and 

This option is more complex than the baseline scenario as it opens 
simultaneous  entitlements  under  the  legislation  of  two  Member 
States: one to be provided with the actual benefit and the other for 
receiving  the  supplement.  A  procedure  to  compare  the  level  of 
benefits  between  the  competent  Member  State  and  the  State  of 
residence  needs  to  be  set  up,  as  well  as  a  procedure  to  settle  the 
payment  of  the  supplement.  It  will  necessitate  an  additional 
exchange  of  information  between  the  Member  State  of  residence 
and the Member State competent for paying the supplement.  

The risk of fraud and abuse is slightly higher than in the baseline 
scenario.  Member  States  with  more  generous  long-term  care 
benefits  warned  that  this  option  could  lead  persons  to  move  to  a 
Member with a higher level of benefits and claim long-term care 
benefits  there.  This  in  itself  is  not  fraud  or  abuse,  but  it  can 
contribute to a perception of so-called 'opportunistic behaviour'. 

As the supplement is paid directly to the person concerned, it will 
not contribute to even burden sharing between Member States, but 
will only increase the total costs of the benefits provided by these 
Member States. 

Both  the  competent  Member  State  and  the  Member  State  of 
residence  have  their  share  in  granting  the  benefit  to  the  person 
concerned.  The  competent  Member  State  will  have  to  reimburse 
the costs made in the Member State of residence, according to the 
level  of  the  State  of  residence  –even  in  this  is  higher  or  the 
Member State of residence would anyhow provide the benefits on 
the  basis  of  its  national  legislation.  If  the  level  of  benefits  in  the 
State of residence is lower, the competent Member State will also 
have to 'top up' the benefits to the level applicable under its own 
legislation. 

the  option  brings 

This  option  introduces  a  stable  regime  appropriate  to  long-term 
care  benefits  and  offers  the  maximum  level  of  protection  to  the 
person.  The  regime  however  differs  from  the  currently  applied 
rules  and  thus  will  require  adaptation  before  full  stability  is 
legal  clarity  and 
achieved.  In  parallel, 
transparency  on  the  rules  applicable  both  for  citizens  and 
institutions  as  well  as  other  stakeholders.  The  payment  of  the 
supplement  for  benefits  provided  in  residence  State  increases  the 
costs  for  the  competent  Member  State.  This  option  is  thus  less 
effective  at  achieving  the  objective  of  a  fair  and  equitable 
distribution  of 
financial  burden  between  Member  States. 
Furthermore,  the  priority  rules  and  calculation  rules  for  the 
reimbursement  of  the  benefits  and  provision  of  the  supplement 
need  to  be  introduced  as  well  as  an  administrative  procedure  for 
settling supplements.  

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Based  on  the  above  tables,  some  preliminary  conclusions  can  be  drawn  on  the  strengths  and 
weaknesses  of  the  different  options  and  their  overall  effectiveness,  efficiency  and  relevance  in 
achieving the various objectives while avoiding excessive costs.  

Option  1  which  introduces  the  legal  basis  for  the  already  applicable  rules,  contributes  positively  to 
bringing legal certainty, transparency and stability of the already applied regime appropriate to long-
term  care  benefits,  while  remaining  compatible  with  similar  system  applicable  to  sickness  benefits. 
These  effects  are  maximised  by  the  inclusion of  clarifications  under  a  separate  Chapter  categorising 
the rules for long-term care benefits separately and offering a clear distinction with the provisions on 
sickness benefits and social assistance. Citizens and institutions will benefit from the clarification of 
these  rules.  This  option  however  will  not  solve  existing  mismatches  in  case  the  competent  Member 
State has no benefits in cash and the State of residence has no benefits in kind. This option will have 
low  implementation  costs  as  it  brings  clarification  without  drastically  changing  the  system  of 
coordination and the information obligations following from that system. In light of the effectiveness 
at achieving the objectives this option is considered the most cost efficient101. It is also coherent with 
wider  EU  Policy  objectives,  in  particular,  the  planned  review  of  the  disability  strategy  2010-2020 
assessing  progress  to  ensure  the  effective  implementation  of  the  UN  Convention  on  the  Rights  of 
Disabled  Persons  across  the  EU  and  the  ongoing  work  to  promote  a  social  agenda  to  support  the 
economic recovery ensuring a Triple A social rating for Europe, which advocates greater efficiency in 
allocation of social protection to challenge examples of multiple benefits overlapping, poorly targeted 
cash or in-kind benefits (services). The option was supported by a significant majority of experts from 
Member States. 

Sub-option  2a  ensures  a  common  understanding  and  increased  transparency  for  citizens  and 
institutions and introduces a stable regime appropriate to long-term care benefits. The regime however 
differs from the currently applied rules which are consistent with the logic applied to sickness benefits 
and the Court’s case-law and thus, will require adaptation before full stability is achieved. The overall 
costs  for  the  spending  on  long-term  care  benefits  in  cash  will  decrease,  caused  by  a  lower  level  of 
benefits in the State of residence, however this cost saving needs to be counter-balanced against the 
fact  this  option  is  less  effective  at  achieving  the  objective  of  a  fair  and  equitable  distribution  of 
financial  burden  between  Member  States.  It  should  be  also  noted  that  while  the  costs  will  indeed 
decrease in some Member States, a negative impact (more spending) may also be observed for other 
Member States in comparison to the baseline scenario and some Member States of residence may be 
required  to  pay  more  than  permitted  under  their  national  legislation  to  reimburse  costs  spent  by  the 
Member State of residence. In the alternative, the option may result in less beneficial result for persons 
insured under the competent State’s system compared to those insured persons who remained resident 
in that State. Introducing a separate reimbursement procedure for long-term care benefits in cash will 
require  setting  up  a  new  system  for  the  exchange  of  information  between  Member  States  and 
information  obligations  for  the  person  concerned  who  has  no  ‘insurance  link’  with  the  State  of 
residence.  This  will  entail  additional  regulatory  costs  compared  to  the  baseline  scenario.  The  option 
may be difficult to implement in decentralised systems providing long-term care benefits. The option 
is, however, coherent with wider EU Policy objectives for the same reasons as set out in relation to 
option  1.  Option  2  did  not  receive  explicit  support  from  any  delegation  in  the  Administrative 
Commission mainly on grounds of the perceived administrative burden. 

Sub-option  2b  ensures  a  common  understanding  and  increased  transparency  for  citizens  and 
institutions  and  introduces  a  stable  regime  appropriate  to  long-term  care  benefits.  It  offers  the 
maximum  level  of  protection  to  the  person,  albeit  this  not  being  the  aim  of  the  Regulations.  The 
person concerned will open simultaneous entitlements under the legislations of more than one Member 
State.  Similarly  to  sub-option  2a,  the  regime  differs  from  the  currently  applied  rules  and  thus,  will 
require  adaptation  before  full  stability  is  achieved.  Priority  rules  and  calculation  rules  for  the 
reimbursement  of  the  benefits  and  provision  of  the  supplement  need  to  be  introduced  as  well  as  an 
administrative  procedure  for  settling  supplements.  This  option  is  therefore  less  efficient  than  the 

101 Table 2.21 in Annex XXVI. 

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current situation. The payment of the supplement will increase the costs especially for the competent 
Member State, which has to reimburse the costs of all long-term care benefits provided by the State of 
residence  and  pay  the  supplement  up  to  the  level  in  its  national  legislation  directly  to  the  person 
concerned  meaning  it  is  less  efficient  than  the  other  options.  The  coherence  of  the  option  with  the 
wider EU Policy Agenda is the same as for option 1. Option 2 did not receive explicit support from 
any delegation in the Administrative Commission. 

5.  Unemployment Benefits 

Current Coordination Rules for Unemployment Benefits  

5.1. 
‘Unemployment  benefits’  are  benefits  granted  if  the  risk  of  loss  of  employment  materialises.102 
Typically an unemployed person is required to register as a person seeking for employment with the 
employment service which is providing the benefit. Unemployed persons are usually required to be fit 
for work, available for work and actively seeking work. 

The  coordination  rules  for  unemployment  benefits  deal  with  three  different  areas  and  concern  three 
different scenarios, namely: 

a) 

the  aggregation  of  periods  of  insurance  completed  by  mobile  workers  in  different  member 
States, 

b)  the  export  of  unemployment  benefits  for  unemployed  persons  who  want  to  move  to  another 

Member State for the purpose of seeking employment there, 

c) 

 the  determination  of  the  Member  State  which  is  competent  for  providing  unemployment 
benefits for frontier and other cross-border workers. 

The rules of coordination in respect of these three areas are briefly summarised below: 

5.1.1  Rules as regards the principle of aggregation  

The  principle  of  aggregation  of  periods  of  social  security  protection  is  a  basic  principle  of  the 
coordination rules, which ensures previous periods completed in another Member State are recognized 
for the purposes of  establishing entitlement. In respect of unemployment, the  rules require  that only 
periods of insurance, employment and self-employment completed in different Member States have to 
be aggregated. This can be explained by the fact that national unemployment schemes are not based on 
periods of residence but rather periods of insured employment. The qualifying period varies from at 
least 4 months in France to 24 months in the Slovak Republic. Most Member States apply a qualifying 
period of some 12 months103.  

The Court has determined that the recognition of those periods,depends on the rules applicable in the 
competent Member State. 104 This means that even periods of employment which did not qualify as an 
insurance period in the country where they have been completed  must be taken into account for the 
purpose of aggregation, if such periods would be covered by the unemployment insurance in the State 
providing the benefit. 

Example: Denmark provides coverage in case of unemployment on a voluntary basis. According to 
the  interpretation  of  the  Court,  it  is  therefore  possible  that  a  mobile  worker  who  elected  not  to  be 
covered  by  the  unemployment  insurance  during  a  period  of  employment  in  Denmark  would 
nevertheless  receive  unemployment  benefits  from  another  Member  State  where  they  subsequently 
become insured on the basis of the Danish periods of employment if those periods would qualify as 
insured periods against the risk of unemployment in that Member State. 

102 Case C-228/07, Petersen, paragraph 28; Case C-404/04, De Cuyper, paragraph 27. 
103 Figure 2 in PACOLET, J. and DE WISPELAERE, F., Aggregation of periods for unemployment, Network Statistics FMSSFE, European 

Commission, June 2015, Annex XXI. 

104 Case 388/87, Warmerdam-Steggerda, EU:C:1989:196. 

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Moreover,  the  current  rules  require  an  aggregation  of  periods  only  subject  to  the  condition  that  the 
person concerned has most recently completed periods of insurance, employment or self-employment 
in the Member State concerned. This particular condition applies only to mobile workers who move to 
another  country,  i.e.  who  change  their  residence  and  claim  unemployment  benefits  under  the 
legislation  of  their  new  country  of  residence.  It  does  not  apply  to  cross-border  workers,  who  by 
definition, already have their residence in another State. 

This  provision  is  based  on  the  general  principle  that  the  Member  State  which  has  received  the 
contributions  shall  also  bear  the  burden  of  the  unemployment  benefits.  This  requirement  of  ‘most 
recent’  insurance  also  encourages  the  search  for  work  in  that  Member  State.  As  a  result,  it  is  not 
possible for an unemployed person to simply move to another Member State or to return to his or her 
State of origin and claim unemployment benefits in that State based on the principle of aggregation of 
periods  completed  in  another  Member  State  without  having  first  been  employed  and  insured  in  that 
Member State.  

Example: Michael loses his job in Member State A and moves or returns to Member State B without 
having registered as unemployed person in Member State A. In this case, Michael will only be entitled 
to  receive  unemployment  benefits  from  Member  State  B  when  he  has  most  recently  been  insured 
there,  i.e.  if  he  obtains  employment  in  Member  State  B  after  his  return  but  once  again  becomes 
involuntarily unemployed. 

The  calculation  of  unemployment  benefits  in  the  event  that  a  person  had  completed  periods  of 
employment  in  more  than  one  Member  State  are  based  on  the  principle  that  unemployed  persons 
should receive their unemployment benefit from the Member State of last activity in accordance with 
the  legislation  applicable  in  that  State.105  Consequently,  the  competent  institution  needs  to  take  into 
account  exclusively  the  salary  or  professional  income  received  in  respect  of  the  last  activity  as  an 
employed or self-employed person106. 

This rule does not affect Member States where unemployment benefits are paid on a flat-rate basis107, 
or those Member States which base the calculation of their benefits on the salary earned at the moment 
when  the  person  became  unemployed108.  Most  Member  States,  however,  base  their  calculation  on 
average salaries earned during a reference period of 3,109 6,110 12111 or even 24 months112.  

5.1.2  The principle of export of unemployment benefits  

One of the basic principles of social security coordination is the requirement that cash benefits shall be 
paid  irrespective  of  the  place  of  residence  of  the  beneficiary.  In  the  area  of  unemployment  benefits, 
however, export is only possible subject to the specific conditions set out below and only for a limited 
period of time.  

An unemployed person who goes to another Member State in order to seek work must 

105 This principle does to cross-border workers who resided during their economic activity in another Member State than the Member State  
where the activity was performed. 
106 Article 62(1) of Regulation (EC) No 883/2004. 
107 Ireland, Malta, Poland, United Kingdom. 
108 Table 9 in Annex VII: The Netherlands take the daily wage into account. Belgium refers to the average salary earned in the last position. 
109 Croatia, Czech Republic, Denmark, Luxembourg. 
110 Iceland, Spain, Switzerland. 
111 Austria, Cyprus, France, Germany, Hungary, Latvia, Norway, Portugal, Romania, Sweden. 
112 Bulgaria, Italy, Slovak Republic. 

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- have been registered with the employment service of the competent Member State for a period of at 
least four weeks,113 

- register with the unemployment service of the Member State where he/she is looking for work within 
seven days after departing, 

- comply with the control procedures organized by the unemployment service of that Member State.  

Jobseekers  who  intend  to  look  for  work  in  another  country  shall  request  a  certificate,  namely  the 
Portable Document U2 (PD U2 – Retention of unemployment benefits) before departure which certifies 
their right to continue to draw unemployment benefit. They should take care to return before expiry of 
the maximum period, because if they return later, without the explicit permission of the employment 
service  of  the  state  which  is  paying  the  benefits,  they  risk  losing  all  remaining  entitlement  to 
benefits.114 

In the new country of stay, the jobseeker will be treated by the employment service exactly the same 
way  as  any  other  jobseeker  in  this  country.  If  the  institution  of  this  country  becomes  aware  of  any 
circumstance  which  might  affect  entitlement  to  benefits,  it  will  immediately  inform  the  competent 
institution  and  the  jobseeker  by  issuing  the  document  U3.  This  document  informs  the  unemployed 
person of the situation and advises him of his right of appeal to the competent institution if he/she does 
not agree in order to ensure the continuation of the benefit payment. 

The periods for which an unemployment benefit can be exported are limited. The original maximum 
period  of  three  months  under  Regulation  1408/71  was  extended  by  Regulation  No  883/2004  to  a 
minimum period of three months and a maximum period of six months. 

5.1.3  Coordination of unemployment benefits as regards frontier and other cross-border 
workers  

Cross-border workers are workers who reside in another Member State than the State of activity. The 
current  rules  differentiate  between  which  Member  State  is  competent  for  providing  unemployment 
benefits as regards to frontier works and other cross-border workers and between the situations, that a 
cross-border worker is wholly, partially or intermittently unemployed. They provide that:  

(cid:190)  Frontier workers shall receive their unemployment benefits from the competent institution in 

their Member State of residence if they are wholly unemployed, and 

(cid:190)  from the institution of the Member State of activity if they are only partially or intermittently 

unemployed. 

(cid:190)  The  same  applies  to  other  cross-border  workers  if  they  are  only  partially  or  intermittently 

unemployed. 

(cid:190)  If they are wholly unemployed, they have a right of choice, i.e. they can return to their country 
of residence and claim unemployment benefits from the institution of that State or remain in 
the country of previous activity and claim benefits there. 

To compensate the institution of the Member State for the fact that they are obliged to provide benefits 
without having received contributions, the rules provide for a reimbursement of benefits paid for the 
first  three  months  or  five  months.  The  five-month  reimbursement  applies  when  the  beneficiary  had 
been insured in the Member State of previous activity for at least 12 months within the last 24 months. 

There  are  specific  rules  for  frontier  workers  who  were  formerly  self-employed.  If  they  reside  in  a 
country where there is no unemployment insurance for self-employed persons, they shall be entitled to 
receive  unemployment  benefit  from  the  institution  in  the  country  of  last  activity  to  which  they  had 
been affiliated. 

113 The underlying idea of this precondition is that an unemployed person should at first exhaust all possibilities of finding a new job in his 
former country of employment before extending the search for employment to other countries. This period can be shortened, however, by the 
institution concerned. 
114 Unless otherwise provided for under the legislation of the competent Member State. 

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5.2. 

Aggregation of periods for unemployment benefits  

5.2.1  Problems with the aggregation of periods for unemployment benefits and the drivers 
behind them 

Drivers

Problems

Divergence in MS' interpretation of the 
rules of aggregation of periods

Access to unemployment benefits in 
another MS after short periods of 
employment in that State with the 
help of the aggregation rules

Access to unemployment benefits in 
the MS of last activity on the basis of 
the reference income earned there
after a short period of insurance or 
(self-)employment

Uneven application of 
aggregation rules in a manner
which may disincentivise the 
search for work in another
Member State

Unintended effect of the 
calculation rule
(perceived unfair gains)

Unintended effect of the 
calculation rule
(perceived unfair gains)

5.2.1.1 Uneven application of the rules on aggregation of periods in a manner which leave 
workers without protection and may disincentivise the search for work in another Member 
State 

Although  the  Court  considered  that  a  uniform  interpretation  of  the  principle  of  aggregation  is  a 
prerequisite for its application115, the condition116 that periods have to be aggregated by the institution 
as soon as the unemployed person has ‘most recently’ completed periods of insurance, employment or 

115 Case C-12/93 Drake EU :C:1994:336, paragraph 26; case 69/79, Jordens-Vosters, EU:C:1980:7, paragraphs 6 and 11. 
116  This  specific  conditions  has  been  justified  by  the  Court  in  the  case  C-12/93  Drake  EU  :C:1994:336,  paragraph  26::  “Article  51  of  the 
Treaty  and  Regulation  1408/71  provide  only  for  the  aggregation  of  insurance  periods  completed  in  different  Member  States  and  do  not 
regulate the conditions under which those insurance periods are constituted.” In the case 69/79, Jordens-Vosters, EU:C:1980:7, paragraphs 
6  and  11,  the  Court  stated:  ‘It  is  well  established  that  the  requirement  that  Community  law  be  applied  uniformly  within  the  Community 
implies that the concepts to which that law refers should not vary according to the particular features of each system of national law but rest 
upon  objective  criteria  defined  in  a  Community  context.’  ‘The essential  object  of  Regulation  No  1408/71  adopted  under  Article  51  of  the 
Treaty  is  to  ensure  that  social  security  schemes  governing  workers  in  each  Member  State  moving  within  the  Community  are  applied  in 
accordance with uniform Community criteria. To this  end it lays down a whole set of rules  founded in particular upon the prohibition of 
discrimination on grounds of nationality or residence and upon the maintenance by a worker of his rights acquired by virtue of one or more 
social security schemes which are or have been applicable to him.'  

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self-employment is not uniformly applied. This is due to the fact that the length of the required period 
of 'most recent insurance' or (self-) employment is not specified in EU law. Most Member States take 
the view that ‘any’ period of insurance or (self-)employment (even one day) will suffice in order to 
trigger  the  application  of  the  principle  of  aggregation.  Some  Member  States117,  however,  have 
specifically defined periods for the application of the aggregation principle in their national law, for 
example because periods of insurance or (self-) employment are expressed in weeks and not in days, 
or as they understand a 'period' to comprise a longer period of time and that mere insurance or (self-) 
employment is not sufficient.  

In  Finland,  section  9  of  Chapter  5  of  the  Unemployment  Security  Act  (1290/2002)  requires  that 
periods of insurance or employment completed in another State shall only be taken into account if the 
person concerned has pursued an activity as an employed person in Finland for at least four weeks or 
as a self-employed person for at least four months immediately before becoming unemployed. 

In Denmark, section 2 of the Danish Ordinance No 490 stipulates that a person who has not been a 
member of a Danish unemployment insurance fund within the last five years but has been insured in 
another Member State will have his or her periods of insurance completed in another Member State 
taken into account subject to, among other conditions, that the person must have worked continuously 
in  Denmark  for  at  least  296  working  hours  in  the  past  12  weeks  or  three  months,  or  for  partially 
employed  persons  148  working  hours  in  the  past  12  weeks  or  three  months.  In  case  of  self-
employment, the equivalent condition is eight full weeks within a period of 12 weeks or three months 
prior to the unemployment. 

A  further  difficulty  is  that  there  is  no  uniform  application  of  the  jurisprudence  regarding  the 
recognition of periods completed in another Member State for the purpose of aggregation. The case-
law  of  the  Court118  in  this  respect  is  not  consistently  applied.  This  leads  to  the  situation  that  some 
Member States also aggregate periods of employment or self-employment for which no contributions 
have been paid, while others do not. According to an internal survey carried out by Poland as a follow-
up  to  the  debate  in  the  Administrative  Commission,  18  Member  States  do  not  aggregate  periods  of 
non-insured  (self-)  employment  completed  in  another  Member  State  whose  legislation  does  not 
provide  for  unemployment  insurance  coverage.  This  number  is  even  higher  (24)  if  the  person 
voluntarily decides not to insure him/herself in the State of activity and afterwards claims that he/she 
has fulfilled periods of employment there.  

Moreover, a debate was launched on this issue in 2011 in the Administrative Commission showed that 
many Member States take the view that the wide interpretation of the Court leads to unjustified results. 
There was support from seven delegations to change the rules on aggregation119.  

The driver behind these related problems is that Member States do not have the same understanding as 
regards  the  recognition  of  periods  to  be  aggregated  or  the  condition  of  most-recent  insurance.  This 
applies in particular with respect to the practice described above whereby some Member States require 
under national law a specific period of insurance before applying the aggregation rules.  

The consequence of this uneven application of the rules is legal uncertainty which may result in the 
situation  that  an  unemployed  person  who  has  not  been  insured  for  long  enough  in  the  competent 
Member  State  is  neither  entitled  to  unemployment  benefits  in  the  State  of  last  activity  nor  in  the 
former State where they previously worked. 

117 For example Finland and Denmark. 
118 Case 388/87, Warmerdam-Steggerda, EU:C:1989:196 
119 Czech Republic, Germany, Austria, the Netherlands, Spain, Denmark. 

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Example: Dorothea has worked for five years in Sweden and then decides to move to Denmark 
to take up a new position there. Unfortunately, she is dismissed after a probation period of two 
months.  As  she  does  not  fulfil  the  conditions  set  out  in  the  Danish  law  (three  months  of 
insurance),  she  cannot  aggregate  her  insurance  periods  to  claim  unemployment  benefits  in 
Denmark. At the same time, she will be refused unemployment benefits in Sweden, as she is no 
longer insured there. 

Had Dorothea spent her working life in Denmark (including the five years in Sweden), then she 
would have been entitled to unemployment benefits in Denmark. 

It may also have the unwanted effect of dis-incentivising the search for work in another Member State. 
The fear that taking up a position in another Member State could lead to a loss of social protection, 
might  discourage  mobile  EU  workers  from  exercising  their  right  to  freedom  of  movement  thereby 
constituting an obstacle to that freedom. This would run counter to the objectives of the Treaty. The 
Court has repeatedly held that the aim of Articles 45 TFEU and 48 TFEU would not be achieved if, as 
a consequence of the exercise of their right to freedom of movement, mobile workers were to lose the 
social  security  advantages  afforded  them  by  the  legislation  of  one  Member  State,  especially  where 
those advantages correspond to contributions which they have paid.120 

5.2.1.2 Access  to  unemployment  benefits  in  another  Member  State  after  short  periods  of 
employment in that State with the help of the aggregation rules may lead to unintended gains 

The most-recent-insurance requirement is intended to prevent unemployed persons from moving to a 
new Member State and immediately claiming unemployment benefits without first having contributed 
to that scheme.  

In  light  of  this  aim  it  is  doubtful  whether  it  was  the  legislator's  intent  that  unemployment  benefits 
should be paid by a new Member State in situations where a worker had been employed only for an 
extremely  short  period,  e.g.  for  only  one  day.  A  number  of  Member  States121  argue  that  it  is  not 
appropriate  that  simply  taking  up  insurance  in  a  Member  State  already  suffices  for  making  this 
Member  State  responsible  for  providing  unemployment  benefits,  when  the  entitlement  to  those 
benefits is to a large extent based on periods of insurance completed in another Member State. They 
argue that their respective schemes should be protected from claims of mobile workers who have not 
in any substantial way contributed to the financing of their scheme122.  

This  reasoning  also  plays  a  role  in  the  case  law  concerning  the  rights  of  jobseekers  to  'social 
advantages123'  under  Regulation  (EU)  No  492/2011.  For  instance,  in  joined  cases  C-22/08  and  C-
23/08, Vatsouras and Koupatanze124, the Court has concluded that jobseekers enjoy the right to equal 
treatment under Article 45 TFEU and hence are entitled to receive jobseekers allowance on the same 
footing  as  nationals  of  the  Member  State  in  which  they  are  looking  for  work.  However,  a  Member 
State  may  decide  to  grant  such  an  allowance  only  after  it  has  been  possible  to  establish  a  'real  link' 
between the jobseeker and the labour market of that State125. 

120 See case C-548/11, Mulders, EU.C:2013:249, paragraph 47 and the case law cited therein 
121 For instance: Denmark, Finland, Austria, France, Greece, Ireland and Romania. 
122 See for example Barslund, M, Busse, M. and Schwarzwälder,J., Labour Mobility in Europe: An untapped resource?, CEPS  
Policy Brief  No. 327, March 2015, Brussels, p. 4.  
123 The Court has held that social advantages means all the advantages which, whether or not linked to a contract, are generally  
granted to national workers primarily because of their objective status as workers or by virtue of the mere fact of their residence  
on the national territory and whose extension to workers who are nationals of other Member States therefore seems likely to  
facilitate the mobility of such workers within the Community. This has been held to cover, for example, public transport fare  
reductions for large families, child raising allowances, funeral payments, minimum subsistence payments, study grants. See, for  
instance Case C-85/96, Martinez Sala, EU:C:1998:217. 
124Joined cases C-22/08 and C-23/08, Vatsouras and Koupatanze ECLI:EU:C:2009:344, paragraphs 36-38.  
125 See also Cases C-224/98, D'Hoop, EU:C:2002:432, paragraph 28 and C-258/04, Ioannidis, EU:C:2005:559, paragraph 31. 

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The available statistics for 23 Member  States who were in a position to provide quantitative data in 
this respect for 2013126 show that in 42% of the approximately 25.000 cases, aggregation was applied 
before 3 months of periods of insurance or (self-)employment had been completed127. When looking at 
the Member States of 'destination' (United Kingdom, Belgium, Spain, France) relatively more requests 
for  aggregation  were  received  within  a  period  of  30  days,  whereas  in  the  Member  States  of  'origin' 
(Hungary, Romania, Bulgaria, Poland, Slovakia), the majority of requests for aggregation of periods 
were  received  after  a  period  of  three  months.  This  could  indicate  that  mobile  EU  workers  are  more 
likely  to  stay  in  or  return  to  the  'higher  wage'  Member  States  directly  after  they  have  become 
unemployed. It is likely that this trend will continue due to a greater availability and use of temporary 
or  precarious  working  arrangements  and  the  willingness  of  people  to  adjust  their  quantity  of  work 
(part-time, on call, informal work, etc.) before returning home128. 

5.2.1.3 Calculation of unemployment benefits in the Member State of last activity only on the 
basis of the reference income earned therein may lead to unintended results after a short 
period of insurance or (self-)employment 

Under  the  current  rules,  Member  States  cannot  take  into  account  salaries  or  professional  income 
earned  during  the  reference  period  in  different  Member  States,  as  they  are  only  allowed  to  base  the 
calculation  on  salaries  or  professional  income  earned  in  their  own  territory.  Although  being 
administratively  easier  to  apply,  this  can  also  lead  to  situations  where  the  calculation  of  the 
unemployment  benefit  is  based  on  salaries  or  professional  income  earned  during  a  period  which  is 
much shorter than the reference period fixed under national law. It cannot always be assumed that the 
salary or professional income received during such a short period in one Member State is equal or at 
least comparable to the salary or professional income received during the reference period in another 
Member  State.  As  a  consequence,  the  current  rules  concerning  the  calculation  of  unemployment 
benefits may lead to unintended results.  

Example: Under Austrian law, the basic amount of earnings-related unemployment benefit amounts 
to 55% of the average insured net earnings of the last calendar year. If a person has previously worked 
in  Germany  and  has  worked  in  Austria  for  only  four  weeks  before  becoming  unemployed  again, 
he/she would receive unemployment benefit in Austria only on the basis of the average salary earned 
within the four weeks when he or she was employed there. The lower or higher average salary earned 
in Germany during the reference period of one year would have no bearing on the amount of his or her 
unemployment benefit in Austria. 

In  the  situation  above,  it  can  be  questioned  to  what  extent  the  salary  earned  during  four  weeks  in 
Austria properly reflects the ‘reference earnings’ of the worker concerned129.  

Some  Member  States  also  fear  that  this  may  provide  a  'pull  factor'  for  opportunistic  behaviour  and 
undermine the sense of the unemployment benefits coordination provisions. Such a concern has been 
articulated  by  six  delegations  of  the  Administrative  Commission130  and  also  by  the  legal  experts 
FreSsco.131 

126 Table 6 in Annex VII. (Annex XII) 
127 Table 2 in Annex XII. 
128 European Commission, Economic and Social Developments in Europe, December 2014, p.48 and OECD Employment  
Outlook 2015,table 1.7, p.30. 
129 This aspect is also highlighted by FUCHS, B. (ed.), GARCIA DE CORTAZAR, C., BETTINA, K. and PÖLTL, M., Assessment of the 
Impact  of  amendments  to  the  EU  socials  security  coordination  rules  on  aggregation  of  periods  or  salaries  for  unemployment  benefits, 
Analytical report 2015, FreSsco, European Commission, June 2015 (Annex VII). 
130 Austria, the Netherlands, Finland, Germany, Ireland, Norway, Denmark. 
131 The same view has been taken by the authors of the FreSsco report FUCHS, B. (ed.), GARCIA DE CORTAZAR, C.,  
BETTINA, K. and PÖLTL, M., Assessment of the impact of amendments to the EU socials security coordination rules on  
aggregation of periods or salaries for unemployment benefits, Analytical report 2015, FreSsco, European Commission, June 2015.  
On the other hand, whereas sometimes mobility can be at the advantage of a worker, in other situations this could not be the  
case. The coordination rules do not always offer more 'advantageous' benefits to mobile workers. For instance, the current rules  
also have as an effect those in cases of 'return migration’ a person could be faced with a lower level of benefits. For instance, a  

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The problem is exacerbated by the large differences between remuneration levels and the calculation 
method  of  unemployment  benefits.  On  the  other  hand,  it  is  mitigated  by  the  fact  that  11  Member 
States132 apply a maximum ceiling to earnings that can be taken into account. For example, in the case 
of  Belgium  the  lowest  amount  of  benefits  to  be  paid  per  day  amounts  to  €36.66  and  the  highest 
amount to € 61.66 regardless of actual earnings.  

5.2.2 

 Baseline scenario 

In the 23 Member States for which data are available for the year in 2013, 24.821 cases of aggregation 
of  periods  for  unemployment  were  reported.  In  relation  to  the  total  annual  inflow  of  migrants  of 
working  age  in  those  States,  this  represents  2.1%.  Given,  however,  that  some  large  EU-15  Member 
States (e.g. Germany and Italy) did not provide data and thus are not included in the above figures, the 
total number of aggregation cases is likely to be higher. 

On average, 0.11% of total unemployment spending by the reporting Member States could be related 
to  aggregation  of  periods.133  The  total  expenditure  for  unemployed  benefits  reported  by  23  Member 
States  for  the  24.821  cases  of  mobile  EU  workers  who  had  to  rely  on  periods  of  aggregation  was 
around € 100 million, of which € 36 (36%) million for workers who had worked for less than 30 days, 
€ 15 million (15%) for workers who had worked between 1 and 3 months, and € 46 million (46%) for 
workers who had worked 3 months or more.134 In absolute terms, France (€ 53 million) and Belgium 
(€ 20.5 million) are the main spending Member States, which can be explained by the higher number 
of aggregation cases and the higher average spending per unemployed persons in comparison to other 
Member States. Romania (€ 2157), Cyprus (€ 3890) and Latvia (€ 4908) can be found on the lower 
end, influenced by the low number of cases for aggregation and the lower annual average expenditure 
per unemployed person. 

As the Member State of last activity has to assume the costs for providing unemployment benefits, it is 
also  this  State  which  is  affected  by  the  provisions  on  the  calculation  of  those  benefits.  The  current 
rules  stipulate  that  the  calculation  of  unemployment  benefits  shall  only  be  based  on  the  earnings 
received in the Member State of last activity. This leads to higher expenditure in all cases where the 
reference earnings in the Member State of last activity are higher than in the Member State of previous 
activity. In the reverse situation, this provision results in savings.135  

The  evolution  of  those  numbers  in  the  future  will  depend  to  a  large  extend  on  the  evolution  of  the 
number  of  new  intra-EU  movers,  their  risk  of  becoming  unemployed  and  the  qualifying  period. 
Moreover, the budgetary impact will also be influenced by the evolution of the unemployment benefit 
and the average duration of unemployment.  

If we assume that working age mobility flows will grow between 2015 and 2020 at the same rate as 
they  have  grown  for  the  overall  flows  year  on  year  between  2010  and  2013  (5.6%),136  and  if  we 
assume  that  2.1%  of  the  total  annual  inflow  of  migrants  of  working  age  will  continue  to  rely  on 
aggregation, then we could estimate that in 2020 there would be some 33.000 cases of aggregation in 
the 28 Member States.  

If, alternatively, we assume that working age mobility flows will grow between 2015 and 2020 by the 
same absolute amount per year as the overall flows year on year have grown between 2010 and 2013 
(66.000),137 and if we still assume that 2.1% of the total annual inflow of migrants of working age will 
continue to rely on aggregation, then we could estimate that in 2020 there would be some 32.000 cases 
of aggregation in the 28 Member States.  

Portuguese worker who has worked in the Netherlands for one year and decides to return to Portugal, where he falls unemployed  
after two months, will receive unemployment benefits based on the salary received in Portugal, without taking account of the  
potentially higher earnings in the Netherlands. 
132 Belgium, Bulgaria, Germany, Spain, Croatia, France, Italy, Cyprus, Netherlands, Austria and Sweden. 
133 Annex XIV, Table 10. 
134 Annex XIV, Table 10. 
135 Annex XIV, Table 2. 
136 Rate is based on average of year on year absolute growth of population all ages based on Eurostat Migration flows data migr_imm1ctz. 
137 Average of year on year absolute growth of population all ages based on Eurostat Migration flows data migr_imm1ctz. 

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Not undertaking action in the field of aggregation could lead to increased public disenchantment and 
exacerbate  criticism  of,  and  anxiety  about  the  consequences  of  free  movement.  It  could  lead  to  the 
situation that (more) Member States apply their own interpretation of the current rules in a restrictive 
way  thus  reducing  legal  certainty  and  risking  that  mobile  EU  workers  will  lose  out  on  rights.  If 
Member  States  were  free  to  apply  the  EU  legal  provisions  on  the  coordination  of  unemployment 
benefits  at  their  discretion,  the  intended  uniform  application  of  these  provisions  could  no  longer  be 
guaranteed. 

5.2.3 Objectives for review of the coordination rules on aggregation of periods  

The  general  policy  objective  of  this  initiative  is  to  continue  the  modernisation  of  the  EU  Social 
Security Coordination Rules by further enabling the citizens to exercise their rights while at the same 
time  ensuring  legal  clarity  and  a  fair  and  equitable  distribution  of  the  financial  burden  among  the 
institutions  of  the  Member  States  involved  and  administrative  simplicity  and  enforceability  of  the 
rules.  

In relation to the rules on aggregation of periods for the purpose of fulfilling qualifying periods set up 
under  national  law  for  entitlement  to  unemployment  benefits,  this  means  in  particular  to  provide 
clarity in order to avoid divergent interpretations and to ensure a uniform application of the rules by all 
Member  States.  At  the  same  time,  there  is  also  a  need  to  consider  the  underlying  reasons  for  the 
current discrepancies and to see how they can be taken into account without depriving mobile citizens 
of the rights in case of unemployment which they may have acquired in different Member States. 

In view of this general objective, the specific objective in this field can be defined as follows: 

(cid:190)  Ensure a uniform and consistent application of the aggregation and calculation rules in a way 

that also reflects the degree of integration of a worker in the insurance system of a Member State. 

(cid:190)  Ensure mobile EU workers benefit from protection of rights when they move to another Member 

State to take up employment there. 

(cid:190)  Ensure a proportionate distribution of financial burden between Member States. 

5.2.4  What are the various options to achieve the objectives concerning the aggregation of 
periods of unemployment benefits? 

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5.2.4.1 Option 0 : baseline scenario 

If the status quo were to be maintained, aggregation can only be applied from the moment when an 
unemployed mobile person, has ‘most recently’ completed a period of insurance or (self-)employment 
under  the  national  unemployment  insurance  scheme,  regardless  of  the  duration  of  that  employment. 
Where  the  amount  of  the  unemployment  benefit  is  determined  as  a  proportion  of  previous  salary  of 
professional earnings, only the wages or incomes earned in the competent Member State are taken into 
account. 

5.2.4.2 Option 1: Formalization of the "one day rule" 

A uniform interpretation of the requirement of ‘most-recent insurance can be achieved by introducing 
a minimum period of prior employment in the text of Regulation (EC) No 883/2004. Option 1 entails 
that the principle of aggregation can be invoked after one day of insurance or (self-employment) under 
their system. This is shortest minimum insurance or employment requirement that can be applied. The 
unemployment benefit shall be calculated on the basis of the salary earned or professional income in 
the State of last activity.  

Example: David moves from Member State A to Member State B and works there for two weeks 
before becoming unemployed. Under this option, he could claim unemployment benefit immediately 
in A based on his (aggregated) periods of insurance completed in B. The amount of the benefit will be 
calculated on the basis of the wage earned during the two weeks of work in A.  

5.2.4.3 Option 2: Introduction of a minimum period of insurance or (self-)employment of one 
or three months 

Instead of interpreting a period of insurance or (self-) employment as one day, reference to a longer 
period of time can be considered as well. About half of the EU Member States use qualifying periods 
of  50  or  52  weeks.  Lithuania  and  Slovakia  have  qualifying  periods  of  64  weeks  or  longer.  If  the 

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employment  history  of  the  mobile  worker  in  the  Member  State  which  has  to  aggregate  should 
sufficiently  represent  the  link  to  the  labour  market  in  that  State,  introducing  a  minimum  period  of 
insurance or work of:  

a) at least one month (option 2a), or 

b) at least three months (option 2b) 
has been completed in the Member State of last activity.138  

The periods are chosen with a view to enable the persons concerned to establish a ‘sufficient link’ to 
the social security system of the competent Member State without depriving them of their rights. This 
would also allow continuing applying the rule that unemployment benefits are only calculated on the 
basis of the salary or professional income earned in the territory of the competent Member State as the 
previously competent Member State would calculate the level of unemployment benefits on the basis 
of the calculation rules applicable there. 

Example:  David  moves  from  Member  State  A  to  Member  State  B  and  works  there  for  four 
months before becoming unemployed. David becomes entitled to unemployment benefits in B based 
on his insurance periods in A because by working for four months he has completed in excess of one 
month (option 2a) or three months (option 2b) of insurance or (self-)employment in Member State B. 
The amount of the benefit would be calculated on the basis of the wage earned during the four month 
period of work in B. 

When discussing this option in the Administrative  Commission, a number of Member States clearly 
pointed  out  that  a  person  should  not  lose  out  on  rights  when  he/she  is  not  able  to  make  a  claim  for 
aggregation and that a solution should be found for these situations139. In general, other stakeholders 
emphasized the need to respect the right of equal treatment. 

It is obvious that the condition of one month of previous employment (option 2a) is easier to fulfil than 
the  condition  of  three  months  of  employment  (option  2b)140.  However,  the  urgency  to  satisfy  this 
condition is greatly reduced if the mobile worker can benefit from unemployment benefits paid by the 
Member State of previous activity in such a case. 

A gap in protection could indeed occur if a mobile worker like David would become unemployed after 
a  period  of  employment  of  for  instance  two  weeks.  In  this  case,  he  may  not  be  able  to  claim 
unemployment benefits in the Member State of previous activity due to the fact that he was not 'most 
recently' insured in that State. 

To overcome this situation, i.e. to allow the unemployed person to stay in the State of last activity to 
search  for  new  work  there,  both  options  should  be  combined  with  a  provision  that  the  previous 
Member  State  of  activity  should  export  the  unemployment  benefit  in  accordance  with  its  national 
legislation. 141 This means that the previously competent Member State will have to apply its rules as if 
the  unemployed  person  were  still  insured  there,  irrespective  of  the  fact  that  the  unemployment 
occurred in the Member State of last activity and that the unemployed person resides in that State142. 
To this end, it shall suffice that the unemployed person registers and makes him/herself available to 
the employment services in the Member State of last activity and that he/she adheres to the obligations 
applied to jobseekers in that Member State.  

138 The length of these periods coincides with the current practice in some Member States (Denmark and Finland). 
139 Portugal, Poland, Germany, Hungary, Austria, France, Greece, Ireland and Romania. 
140 The three months also correspond to the current right to claim an export of unemployment benefits for at least such a period  
and to the rule contained in Articles 6 and 24(2) of the Free Movement Directive 2004/38, according to which an inactive person  
may move to another Member State without any further requirement regarding his income, but at the same time also without a  
right to social assistance benefits in the host Member State.  
141 The options with regard to the export of unemployment benefits are discussed in paragraph 5.3.4. 
142 According to the case-law of the Court (Case C-308/84, Naruschawicus, EU:C:1996:28, paragraph 26), the requirement of  
‘availability’ cannot have as a direct or indirect effect that a person should be required to change his or her residence.  

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This  means  that  an  unemployed  person  shall  not  be  forced  to  return  to  the  previously  competent 
Member State to register with the employment services there.  

Example: If David had been in employment for only two weeks in Member State B in the example 
above, he cannot claim unemployment benefits in Member State B as he does not satisfy the condition 
of at least one or three months of employment there.  

However,  by  using  the  export  provision,  he  will  nevertheless  be  able  to  receive  unemployment 
benefits from Member State A on the basis of his earnings and his periods of insurance there. He will 
have  to  register  with  the  employment  services  in  Member  State  B,  which  will  follow-up  on  his  job 
searching  activities  on  behalf  of  the  employment  service  in  Member  State  A  and  which  will  report 
back to Member State A.  

Option 2a and 2b only apply to the specific situation where a person has moved his or her residence to 
another State and then becomes unemployed after having completed less than one or three months of 
insurance  or  (self-)employment.  These  options  hence  do  not  affect  frontier  and  other  cross-border 
workers, that is to say those workers whose place of residence already was, and remains, in another 
Member State than the Member State of last activity during their unemployment. 

5.2.4.4 Option 3: Taking into account previous earnings received in another Member State if 
a person has worked less than one or three months in the competent Member State 

This  option  aims  to  establish  a  stronger  link  with  the  level  of  the  previously  earned  salary  or 
professional income (‘reference earnings’). 

Option  3  reflects  this  idea,  but  only  in  case  where  the  person  concerned  has  worked  for  a  period 
shorter than: 

- one month (option 3a), or  

- three months (option 3b) in the competent Member State.  

These two sub-options allow Member States that calculate their unemployment benefit by reference to 
previous average earnings to take into account also reference earnings that have been received in the 
territory of another Member State. 

Example: David moves from Member State A to Member State B and works there for two weeks 
before becoming unemployed. Under this option, he could claim unemployment benefit immediately 
in  Member  State  B  based  on  his  (aggregated)  periods  of  insurance  completed  in  Member  State  A. 
However,  his  unemployment  benefit  will  be  calculated  on  the  basis  of  an  average  of  the  salaries  in 
Member States A and B. 

Imagine  that  the  reference  period  for  calculating  unemployment  benefits  in  Member  State  B  is  12 
months. Imagine David has worked for 12 months in Member State A and 2 weeks in Member State 
B. David has earned a monthly salary of € 1000 in Member State A and € 500 in Member State B. The 
unemployment  benefit  in  Member  State  B  will  be  calculated  on  the  basis  of  the  following  salary: 
(2/52* € 500) + (50/52 *1000) = € 19.23 + € 961.53 = € 980.76. 

Option 3 is an alternative to option 2. Both options lead to the result that in case of short employment 
in  the  new  Member  State  of  less  than  one  or  three  months,  the  calculation  of  the  unemployment 
benefit is (also) based on earnings received in the Member State of previous activity. However, under 
option 2, the benefit is paid by and at the expense of the institution of the Member State of previous 
activity, whereas under option 3, benefits are paid by the Member State of last activity.  

5.2.4.5 Horizontal option: clarification of the conditions for the recognition of periods to be 
aggregated 

This option can be combined with each of the previous options, as its aim is to clarify the conditions 
under  which  a  person  has  a  right  to  base  his  or  her  claim  or  unemployment  benefits  on  periods 
completed in another Member State. 

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The current Article 61 is the source of much controversy between Member States, as is shown by the 
results of the survey carried out within the Administrative Commission under the Polish Presidency in 
2011.  This  holds  especially  true  when  it  comes  to  the  question  of  whether  periods  of  employment 
always  provide  for  coverage  in  the  Member  State  in  which  they  were  fulfilled.  In  order  to  ensure  a 
uniform interpretation of Article 61 (1) of Regulation (EC) No 883/2004, it is important the legal text 
be as clear and unequivocal as possible. This could either be done by introducing this clarification in 
Article  61,  or  by  applying  the  general  rule  on  the  aggregation  of  periods  in  Article  6  of  Regulation 
(EC) No 883/2004.  

A  uniform  aggregation  rule  can  accommodate  Member  States'  desires  that  periods  that  do  not  give 
entitlement to unemployment benefits in the Member State where they were completed are not taken 
into account for the purposes of aggregation. 

5.2.4.6 Discarded Option 

The  idea  to  introduce  a  reimbursement  mechanism  between  the  Member  State  of  most  recent 
Employment  and  Member  State  of  previous  employment  as  an  alternative  to  Option  2a  and  b  was 
considered  but  has  been  discarded,  as  the  current  problems  with  the  reimbursement  mechanism  for 
unemployed  frontier  workers  show  that  such  a  mechanism  is  likely  to  create  disputes  and  delays 
between the institutions involved. 

5.2.5  Stakeholders' views on the different options 

5.2.5.1 Option 0 : baseline scenario  

In consultations with stakeholders, maintaining the status quo was supported by ten delegations in the 
Administrative Commission143 Further in the public consultation only 40% of organisations and 33% 
of  individuals  indicated  support  that  the  current  rules  should  be  changed.144  However,  some  of  the 
social partners and NGO representatives145 took the view that they could accept a change of the rules if 
the rights of mobile citizens continue to be safeguarded. 

5.2.5.2 Option 1: Formalization of the "one day rule" 
Ten  delegations  supported  this  option146.  In  addition,  in  the  public  consultation  only  40%  of 
organisations and 33% of  individuals indicated support for  moving from the prevailing practice that 
one  day  of  insurance  suffices,  however,  amongst  the  comments  from  respondents  there  was  support 
for consistent practices among Member States.  
Eight delegations147 indicated that they could accept option 1 if in return the calculation rule would be 
amended,  or  vice  versa,  as  either  one  of  the  rules  is  needed  to  establish  a  'genuine  link'  with  the 
unemployment insurance system.  

5.2.5.3 Option 2: Introduction of a minimum period of insurance or (self-)employment of at 
least one month (option 2a) or three months (Option 2b) 
Option 2a was supported by three delegations in the Administrative Commission148. Option 2b gained 
support from 10 delegations149 of which 5150 made an explicit written request to introduce a minimum 
period  of  insurance  or  (self-)  employment  in  Article  61.  There  is  also  support  from  an  employer 

143 The Bulgarian, Czech, Estonian, German, Croatian, Italian, Polish, Portuguese, Slovakian, and Slovenian delegations supported  
this option. 
144 A public consultation between July and October 2015 invited citizens and organisations to provide their views on  
the main problems linked to the coordination of unemployment benefits, family benefits and posting of workers. 
145 A global consultation with social partners and NGOs took place. 
146 The Bulgarian, Czech, Estonian, German, Croatian, Italian, Polish, Portuguese, Slovakian, and Slovenian delegations supported  
this option. 
147 The Bulgarian, Italian, Portuguese, Belgian, Estonian, Irish, Polish and Swedish delegations 
148 The Finnish, Luxembourgish and Hungarian delegations. 
149 The Austrian, Danish, Greek, French, Irish, Latvian, Lithuanian, Maltese, Romanian and United Kingdom delegations. 
150 Austria, France, Greece, Ireland and Romania. 

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association151. Less than half of the respondents to the public consultation commented on the principle 
of aggregation, but amongst that group there was general support for the idea of consistent practices 
between  Member  States.  In  addition  there  was  general  support  of  introducing  a  minimum 
employment/ contribution period at EU level. At the same time, many argued that the Member State 
where  the  contributions  are  paid  –  namely  the  Member  State  of  (the  last)  employment  –  should 
provide  the  unemployment  benefits.  Among  organisations  responding  to  the  consultation,  the 
proposed  period  was  at  least  one  month,  while  among  individuals  there  was  greater  support  for  a 
minimum qualifying period of insurance of at least three months (or longer). 

5.2.5.4 Option 3: Taking into account previous earnings received in another Member State if 
a person has worked less than one month (option 3a) or three months (option 3b) in the 
competent Member State 
This issue has been raised by six delegations152 in the Administrative Commission, where they have 
proposed to introduce a stronger link between the salary or professional income earned and the amount 
of  the  unemployment  benefit  awarded.  Although  only  a  minority  of  respondents  to  the  public 
consultation commented on the issue of "reference earnings", among those that did there was general 
support for the principle that unemployment benefits should be calculated by reference to earnings for 
the entire reference period including those earned in another Member State. 

5.2.6  What are the Impacts of the Different Options on aggregation of periods of insurance 
or (self-)employment 

5.2.6.1 Introduction 

For  all  of  the  options  assessed,  the  potentially  affected  groups  are  the  same.  The  options  are 
specifically targeted at mobile EU workers, that is to say: workers who have moved their residence to 
the new State of activity. Hence, they do not concern frontier workers or other cross-border workers. 
National  governments  will  have  to  administer  the  rules  in  the  framework  of  their  national  legal 
systems and allocate resources to the national, regional of local institutions to apply the principle of 
aggregation.  At  the  executive  level,  national,  regional  or  even  local  institutions  providing 
unemployment  benefits  to  workers  will  have  to  deal  with  claims  for  aggregation  of  periods  of 
insurance or (self-)employment. 

In relation to fundamental rights all options aim to facilitate the exercise of the right to engage in work 
in  another  Member  State  (Article  15)  by  clarifying  the  provisions  on  aggregation  of  unemployment 
benefits.  They  also  respect  the  right  to  social  security  benefits  (Article  34).  In  terms  of  respecting 
equal treatment and the right to free movement under Article 45 of the Charter as well as Article 45 
TFEU, the Court has held that the legislator can attach conditions to the rights granted by Article 45 
TFEU153,  as  long  as  mobile  workers  are  not  put  at  an  unjustified  disadvantage  in  comparison  to 
national workers, for example where they will have to pay social security contributions in which there 
is  no  return154.  Although  the  options  are  directly  targeted  at  mobile  EU  workers,  a  difference  in 
treatment can be justified only if it is based on objective considerations distinct from the nationality of 
the persons concerned and is proportionate to the legitimate aim pursued under national law.  

In  relation  to  the  economic  impact,  it  has  to  be  pointed  out  that  the  aggregation  of  periods  is  a 
mechanism to open, retain or recover a right to unemployment benefits. The principle as such does not 
have a direct budgetary impact, whereas the direct consequence of applying that principle, namely the 
payment of unemployment benefits, has. A detailed overview is provided in Annex XXII. It has to be 

151 UEAPME. 
152 Austria, the Netherlands, Finland, Germany, Ireland and Norway. 
153 Case C-62/91, Gray, EU: C:1992:177, paragraph 11. 
154 See, to that effect, Cases C-393/99 and C-394/99, EU:C:2002:182, paragraph 51, C-493/04, Piatkowski, EU:C:2006:167,  
paragraph 34, C-345/09, Van Delft, EU:C:2011:57, paragraphs 100 and 101; C-388/09, da Silva Martins, EU:C:2011:439,  
paragraph 72 and 73. 

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noted  that  a  total  of  23  Member  States155  (Belgium,  Bulgaria,  Denmark,  Estonia,  Spain,  France, 
Croatia, Cyprus, Latvia, Lithuania, Luxembourg, Hungary, Malta, the Netherlands, Poland, Romania, 
Slovakia,  Finland,  Sweden,  United  Kingdom,  Liechtenstein,  Norway,  Switzerland)  provided 
quantitative data, of which three Member States (France, Spain and Estonia) were not able to provide a 
breakdown  by  Member  State  of  origin.  The  missing  data  for  a  number  of  large  Member  States,  in 
particular  EU-15  Member  States,  have  entailed  some  limitations  in  the  assessment  of  some  of  the 
options156. The full study is attached in Annex XIV.157  

Based  on  the  data  from  the  administrative  questionnaire  on  the  aggregation  of  periods  for 
unemployment the budgetary impact of the current rules and the different alternative options could be 
calculated. Member States had to provide a breakdown by Member State of origin and a breakdown by 
length  of  insurance.  The  reported  cases  have  been multiplied  by  the  annual  average  expenditure  per 
unemployed  person  (also  by  taking  into  account  the  annual  average  duration  of  the  payment  of  the 
unemployment benefit) in order to estimate the public unemployment spending. Option 3 (change of 
the  calculation  method)  required  more  detailed  information  about  the  unemployed  recent  migrant 
worker’s salary. No information on the salary earned in the competent Member State as well as in the 
Member  State  of  origin  was  collected  via  the  administrative  questionnaire.  Therefore,  wage  data 
published by Eurostat has been used. 

The  analysis  solely  focuses  upon  the  cost  to  the  competent  Member  State  for  the  provision  of 
unemployment benefits.  It is recognised that in relation to option 1 and 2 there could be a shift in the 
competence  for  other  social  security  benefits  (in  particular  for  family  and  sickness  benefits)  for  the 
cases where a person has worked for an insufficient period in the Member State of last employment to 
qualify  for  aggregation  of  unemployment  benefits  meaning  that  competence  shifts  to  the  Member 
State of previous employment. However, insufficient data is available to quantify the economic impact 
resulting therefrom. 

When looking in particular at economic impact, regulatory costs and secondary impact for option 2, as 
already explained above158, this option has evolved during the impact assessment, notably by making 
the Member State of previous employment responsible for exporting unemployment benefits for those 
workers who have not completed a period of insurance of one or three months in the Member State of 
last employment. For this reason, a quantitative assessment has only been made for the first version of 
the option, whereas a qualitative assessment could be made for the final version of the option. 
There  are  large  differences  between  the  salaries  across  the  23  Member  States  surveyed159,  and  it 
should be borne in mind that data limitations are even more significant than for the other options as the 
economic impact for this option could only be estimated for some 14 Member States. The estimated 
budgetary impacts do not take into account the 'flattening' of the level of unemployment benefits due 
to  a  ceiling  of  earnings  applicable  in  some  Member  States  or  minimum  or  maximum  amount  of 
benefits. The negative impact thus can be mitigated by such a ceiling. 

The regulatory costs for both public administrations and citizens were assessed through a number of 
interviews  with  public  officials  working  for  administrations  dealing  with  the  aggregation  of 
unemployment benefits (both as Member States of last employment and of previous employment) in 
six  Member  States  (Germany,  Denmark,  the  Netherlands,  Poland,  Romania,  the  United  Kingdom). 
The full study is attached to this report in Annex XVII.160 

155 For the purpose of Social security coordination rules, the term Member State refers to the EU-28 + Switzerland, Norway, Liechtenstein 

and Iceland.  

156 For a detailed reporting on the questionnaire on the aggregation of periods for unemployment, see Annex XII. 
157 Pacolet, J. & De Wispelaere, F, Aggregation of periods or salaries for unemployment benefits - Analysis of the economic impact of the 

options, 2015 (Annex XIV). 

158 See above, chapter 4.3 (Option 2 – Introduction of a minimum period of insurance or (self-)employment of one or three  
months). 
159 Table 17, Annex XIV. 
160  Katrine  Julie  Abrahamsen,  Monica  Lind,  Peter  G.  Madsen  ,  Administrative  costs  of  handling  aggregation  of  periods  or  salaries  for 

unemployment benefits, 2015 (Annex XVII). 

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The proposed policy options can also have an incidence on mobility decision and mobility patterns of 
mobile  EU  workers.  The  secondary  impacts  of  the  options  in  terms  of  inflows  and  outflows  of  EU 
citizens  were  estimated  on  the  basis  of  case  studies  in  eight  Member  States  (Germany,  Denmark, 
France,  the  Netherlands,  Italy,  Poland,  Romania,  and  the  United  Kingdom).  They  provide  an 
indication on the direction and the general magnitude of the variation generated by the implementation 
of the policy options. The full study is attached to this report in Annex XIX.161  

Finally, the options have been compared to the baseline scenario and with regard to their effectiveness 
in  achieving 
their  efficiency  (cost-
effectiveness/even burden sharing), coherence with the general objectives of the EU and their impacts 
as assessed below.162 

the  general  and  specific  objectives  of 

initiative, 

the 

161 Michele Raitano, Matteo Luppi, Riccardo Conti, Diego Teloni, Secondary effects following a change of regulations on the aggregation of 

periods or salaries for unemployment benefits, 2015 (Annex XIX). 

162  Secondary  impacts  are  not  considered  in  the  final  comparison  in  recognition  of  the  limitations  of  the  data  available  to  conduct  this 
assessment. 

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5.2.6.2 Summary of the impact of different options concerning the aggregation of periods for entitlement to unemployment benefits 

Clarification 

Simplification  Protection  of 

rights 

Fundamental 
rights 

Economic 
impacts 

Regulatory 
costs 

Risk  of  fraud 
and abuse 

Equitable 
burden 
sharing 
Member 
State 

Coherence with 
General, 
Specific 
EU objectives 

and 

Overall 
Effectiveness 

Overall 
Efficiency 

(cost 
effectiveness 

vs 

0 

+ 

+ 

+ 

+/- 

+/- 

+ 

0 

+ 

+ 

+/- 

+/- 

- 

+ 

0 

+ 

+ 

+ 

+/- 

+ 

+/- 

0 

+ 

+ 

+ 

+ 

+ 

0 

0163 

0 

+/-165 

+/- 

-166 

-168 

0 

0164 

+/- 

+/- 

+/- 

-167 

+/-169 

+ 

0 

- 

+ 

+ 

+ 

+ 

+ 

0 

- 

+ 

++ 

- 

- 

+ 

0 

- 

+ 

0 

0 

+ 

+ 

0 

++ 

0 

0 

+ 

+ 

+ 

0 

++ 

+ 

++ 

- 

- 

+ 

Type 
impact 

of 

Baseline 
Scenario 

Option 1 

Option 2a 

Option 2b 

Option 3a  

Option 3b 

Horizontal 
Option 

163 € 100 m is the budget devoted to aggregation of UB in 23 reporting Member States, equating to on average, 0.11% of total unemployment spending by the reporting Member States - Annex XIV, Table 10. 
164 Costs for handling aggregation of UB varies between € 100 – 40,000 in selected Member States. 
165 Decrease of €21 million (-22%) for Member State of last employment (= Member State of residence), but corresponding increase for Member State of previous employment. 
166 Small decrease (-3.2%). 
167 Increase by 28% . 
168 Small decrease (-4.1%). 
169 Increase by 29%. 

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55 

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5.2.6.3 Impacts of Policy Option 1: Formalisation of the "one day rule" 

Policy Option 1: Formalisation of the “one-day-rule” 

Social impacts  

Clarification 

Simplification 

Protection of rights 

+ 

+ 

+ 

Clarity  of  the  legal  rule  on  aggregation  will  be  improved  by 
eliminating  the  divergent  interpretations  on  the  application  of  the 
aggregation rule, thereby increasing legal certainty. 

A uniform interpretation of the rules on aggregation will contribute 
to  simplifying  the  aggregation  procedure  for  the  institutions 
concerned  as  they  will  all  apply  it  as  from  the  same  moment.  A 
limited number of Member States (Denmark, Finland) would have to 
change their national legislation. 

Uniform  application  of  the  principle,  that  aggregation  takes  place 
after  one  day  of  insurance,  employment  or  self-employment  in  the 
competent Member State will faciltate access for mobile EU citizens 
to  their  rights  to  unemployment  benefits,  as  Member  States  will 
apply  a  consistent  approach  to  aggregation  of  periods  completed  in 
another Member State. 

Economic impacts 

Financial impact 

0 

Impact on fundamental rights 

+ 

On  average,  0.11%  of  the  total  unemployment  spending  (around  € 
100m)  by  the  reporting  Member  States  is  related  to  aggregation  of 
periods. This option is likely to entail a slight increase of expenditure 
for those Member States170 which currently require in a longer period 
of  insurance  or(self-)employment  before  aggregation  is  applied  in 
accordance  with  their  national  legislation.  However,  as  26  Member 
States  currently  apply  the  one  day  rule  as  the  'standard'  period  for 
triggering  aggregation 
to  be 
negligible.171 

is  expected 

the  overall 

impact 

This option aims to facilitate the exercise of to the right to engage in 
work in another Member State (Article 15 of the Charter), as well as 
to  a  better  protection  of  rights  for  workers  who  have  made  use  of 
their right to free movement (Article 45 of the Charter). The right to 
property  (Article  17  of  the  Charter)  will  be  respected  as  well,  as 
periods acquired in a previous Member State can be added to periods 
of insurance or (self-)employment as of the first day of insurance or 
(self-)  employment  in  the  host  Member  State  and  no  'gap'  in  the 
protection of the worker can occur. The principle of equal treatment 
(Article  21  of  the  Charter)  is  also  respected  as  nationals  and  non-
nationals are subject to the same conditions as regards their rights to 
unemployment benefits. 

170 Denmark and Finland. 
171 There may be an increase could be expected in the number of workers being able to claim unemployment benefits in those Member States 
that today require a longer period of work than one day before aggregation can take place, for instance Denmark (now applying a three-
month period for those who have not yet been  a  member of an unemployment insurance fund for at least five years) and Finland (now 
applying a one-month period). 

EN 

56 

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Other impacts 

Regulatory Costs 

+/- 

Risk of fraud and abuse 

Fair  burden  sharing  between 
Member States 

Mobility 

Coherence  with  General, 
Specific 
and  wider  EU 
Objectives: 

- 

- 

0 

- 

the 

EU 

exercise 

Continue  the  modernisation  of 
the 
Security 
Social 
Coordination  Rules  by  further 
facilitating 
of 
citizens'  rights  while  at  the  same 
time ensuring legal clarity, a fair 
and  equitable  distribution  of  the 
financial  burden  among 
the 
institutions of the Member States 
administrative 
involved 
simplicity  and  enforceability  of 
the rules. 

and 

This  option  will  not  have  a  significant  effect  on  the  administrative 
burden of institutions as it will reflect existing practice in 26 of the 
28 Member States. A marginal increase of aggregation cases and the 
corresponding  regulatory  costs  may  occur  in  those  Member  States 
that  today  require  a  longer  period  of  work  than  one  day  before 
aggregation  of  previous  periods  of  employment  can  take  place 
(Denmark and Finland). 

In principle, the requirement of one day of employment may be used 
by  some  mobile  workers  or  employers  to  engage  in  bogus 
employment, although there is no evidence in this respect. 

This option does not contribute to a fairer sharing of burden between 
Member  States  as  a  Member  State  may  become  responsible  for 
providing  unemployment  benefits  even  in  cases  where  they  have 
received  a  relatively  (very)  small  part  of  the  social  security 
contributions. 

In terms of mobility flows, it is estimated that a formalisation of the 
"one  day  rule"  could  result  in  a  negligible  increase  in  workers  and 
jobseekers  movements  towards  those  countries  that  today  require  a 
longer  period  of  work  than  one  day  before  aggregation  of  previous 
periods  of  unemployment  can  take  place.  Considering  the  low 
number of aggregation cases even in countries that apply the one day 
rule, the increase in flows is expected to be very limited.172 

This  option  introduces  legal  clarity  and  simplicity  for  unemployed 
persons  and  is  easy  to  implement  from  an  administrative  point  of 
view  for  the  majority  of  Member  States.  It  also  has  negligible 
budgetary impact On the other hand; it fails to require a genuine link 
with the unemployment insurance system in the State of last activity. 
This  option  in  itself  is  therefore  not  the  most  effective  option  to 
strike a balance between the aims of protecting mobile workers and 
requiring  a  certain  degree  of  integration  in  the  labour  market  and 
insurance  system  of  the  State  of  last  activity,  before  it  becomes 
responsible  for  the  payment  of  benefits.  It  is  neutral  in  relation  to 
coherence with wider EU policy objectives.  

•  Ensure  a  uniform  and 
consistent  application  of 
the 
and 
aggregation 
calculation rules reflecting 
the  degree  of  integration  in 
the Member State. 

•  Ensure  mobile  EU  workers 
benefit  from  protection  of 
rights 

• 

a  proportionate 
 Ensure 
distribution  of 
financial 
burden  between  Member 
States 

172 See table 3.1.1, Annex XIX. 

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57 

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5.2.6.4 Impacts of Policy Option 2: Introduction of a minimum period of insurance or (self)-
employment of one month (sub option2a) or three months (sub option 2b) 

Policy Option 2: Introduction of a minimum period of insurance or (self-)employment of one month (sub 
option 2a) or three months (sub option 2b) 

Social impacts 

Clarification 

Simplification 

+ 

+ 

Protection of rights 

+ 

Clarity  of  the  legal  rule  on  aggregation  will  be  improved  by 
elminating the divergent interpretations. 

A uniform interpretation of the rules on aggregation will contribute 
to  simplifying  the  aggregation  procedure  for  the  institutions 
concerned  as  they  will  all  apply  it  as  from  the  same  moment.  A 
limited number of Member States (Denmark, Finland) would have to 
change their national legislation. A small number of citizens, who do 
not have the requisite minimum period of insurance may experience 
a  change  in  the  competent  Member  State  responsible  for  their 
unemployment  benefits  as  competence  would  revert  to  the  Member 
State  of  previous  activity.  However, 
such  administrative 
arrangements  would  be  largely  dealt  with  by  the  competent 
institutions. 

those  mobile  EU  citizens  who  claim 

Uniform  application  of  the  principle,  that  aggregation  takes  place 
after one month (option 2a) or three months (option 2b) of insurance, 
employment or self-employment in the competent Member State can 
affect 
to 
unemployment  benefits  within  a  period  of  one  (option  2a)  or  three 
(option 2b) months. As a consequence, a group of 6.742 (1month) or 
10.082  (3  months)  mobile  EU  workers  concerned  would  not  be 
entitled to unemployment benefits in the last State of activity as long 
as they have not fulfilled this minimum period meaning they would 
have  no  right  to  unemployment  benefits  from  the  competent  State. 
This would negatively affect their right to free movement. 

their  right 

Economic impacts 

Financial impact 

+/- 

However, this disadvantage will to a large extent be compensated by 
an  export  of  unemployment  benefits  from  the  Member  State  of 
previous activity.  

This option is likely to entail a slight increase of expenditure for the 
Member States of previous emploment (to a larger extent under sub 
option 2b than under sub option 2a), but a corresponding decrease of 
expenditure for the Member States of last activity (37% for option 2a 
vs 51% for option 2b). Overall, there will be a positive impact with a 
decrease  of  the  expenditure  of  €21  million  (22%)  for  2a)  and  of 
approximately € 29 million (42%) for 2b)173 

The most significant reductions will occur in Belgium (€ 6.8 million 

173 This is based on a calculation of €51 million (€36 million for workers with less than 30 days of insured work + €15 million workers with 
less  than  3  months  who  will  not  fulfil  the  minimum  period  for  aggregation  minus  €22  million  (amount  to  be  paid  by  the  previous 
Member State responsible for unemployment benefits considering a 3 month entitlement (see Annex XIV Table 16). 

EN 

58 

   EN 

 
 
                                                 
for  2a  and  €12.8million  for  2b  ),  Spain  (€  3.1  million  for  2a  and 
€4.5million for 2b) and France (€ 25 million for 2a and €33 million 
for  2b)174,  being  the  Member  States  with  currently  the  highest 
number of aggregation cases. 

While  increases  in  public  employment  expenditure  in  the  Member 
States of previous employment: of € 3.4 million in respect of option 
2a  and  €6.5  million  in  respect  of  option  2b  (both  calculations 
assuming  an  entitlement  for  3  months),  with  the  Netherlands  (€  1 
million in respect of option 2a and €2million in respect of 2b ) and 
France (€ 0.4 million in respect of 2a and €0.6 million in respect of 
2b) being the most affected countries175. 

Furthermore, there could be a shift in the competence for other social 
security  benefits  (in  particular  for  family  and  sickness  benefits)  for 
the 6,471 (one month) or 10,082 (3 months) cases from the Member 
State  of  last  employment  to  the  Member  State  of  previous 
employment.  However,  insufficient data  is  available  to  quantify  the 
economic impact resulting therefrom.  

Under  option  2,  the  rights  of  mobile  EU  workers  will  be  protected 
through  securing  export  from  the  previously  competent  Member 
State. Limiting the time for the export of unemployment benefits is 
one of the conditions which are permitted176. In terms of respecting 
the  principle  of  proportionality,  the  introduction  of  a  minimum 
period of work and (self-) employment the objective of establishing a 
sufficient  link  to  the  social  security  system  of  the  host  Member 
State177  is  balanced  with  safeguards  to  ensure  continuity  of 
protection  for  the  worker.178  The  right  to  property  (Article  17)  is 
respected  by  ensuring  that  the  person  can  receive  unemployment 
benefits from the previously competent Member State, at least during 
the period of export. 

This  sub  option  does  not  impose  new  information  obligations  on 
unemployed persons or require new implementing arrangements for 
the  institutions.  It  does  however  result  in  shifting  the  responsibility 
between  Member  States.  Where  previously  an  unemployed  mobile 
EU worker could apply for aggregation in the State of last activity to 
claim unemployment benefits there, he/she now needs to apply for an 
export  of  unemployment  benefits  from  the  previously  competent 
Member  State.  To  that  end  there  may  be  additional  administrative 
tasks  for  the  respective  Member  States  of  most  recent  employment 
and previous employment.  

Impact on fundamental rights 

+ 

Other impacts 

Regulatory Costs 

+/- 

the 

the  basis  of 

On 
interviews  conducted  with  national 
administrations,  it  is  estimated  that  the  administrative  tasks  for  the 
institutions  of  the  Member  State  of  last  employment  would  remain 
from  Germany,  Denmark, 
almost  unchanged. 
Netherlands and United Kingdom expect a reduction in the number 
of  cases  –  see  also  mobility  below  –  which  would  translate  into  a 

Interviewees 

174 Tables 10, 11 and 14 Annex XIV. 
175 Tables 12 and 15 Annex XIV. 
176 Joined cases 41/79, 121/79 and 796/79, Testa, EU:C:1980,163, paragraph 14. 
177 Case C-62/91, Gray, EU: C:1992:177, paragraph 12. 
178 In terms of respecting equal treatment and the right to free movement under Article 45 of the Charter as well as Article 45 TFEU, the 
Court of Justice has held that the legislator can attach conditions to the rights granted by Article 45 , as long as mobile workers are not put at 
an  unjustified  disadvantage  in  comparison  to  national  workers,  for  example  where  they  will  have  to  pay  social  security  contributions  in 
which there is no return.. 

EN 

59 

   EN 

 
                                                 
marginal reduction of the total regulatory costs in Germany (€300 for 
option  2a  and  €400  for  2b),  Denmark  (€200  for  2a  and  2b)  and 
Poland (€350 for 2a and €2700 for 2b)179. 

In  the  Member  States  of  previous  employment,  a  corresponding 
increase is to be expected, though it was not possible to quantify it180. 

In  particular  option  2b  ensures  a  clearer  link  between  the  State 
responsible for awarding benefits and where contributions have been 
paid,  but  could  also  provide  for  an  incentive  to  accept  part-time  or 
low-paid employment in the Member State of last activity just for the 
purpose of being able to claim unemployment benefits. 

This  option  –  in  particular  sub  option  2b  -  contributes  to  a  fairer 
sharing  of  burden  between  Member  States  as  their  institutions 
become  responsible  for  providing  unemployment  benefits  only  to 
those  mobile  workers  who  had  been  a  member  of  the  scheme  and 
who  had  therefore  contributed  to  the  financing  of  the  schme  for  a 
substantial  period.  In  comparison  to  the  baseline  scenario,  a 
reduction  of  approximately  €  3.6  million  (37%)  in  the  expenditure 
for  unemployed  benefits  for  people  needing  aggregation  for  23 
reporting Member States can be estimated. 

An  estimation  (on  the  basis  of  the  case  studies  aimed  at  measuring 
the effects generated by this option in terms of intra-EU mobility) 181, 
which did not take into account the fact of making the Member State 
of previous employment competent, concluded that a reduction in the 
mobility  flows  could  occur,  notably  towards  Denmark  (up  to  6%), 
Italy (up to 4.5% for 2a and 6% for 2b), France (up to 2.5% for 2a 
and 3.4% for 2b) and Germany (up to 2.5% for 2a and 3.3% for 2b). 
In  the  United  Kingdom,  the  impact  of  option  2a  could  be  rather 
moderate  (a  decrease  of  0.6%)182.  These  results  are  driven  by  the 
country-specific  figures  on  migration  flows,  average  levels  of 
unemployment  benefits  and  income  differentials183.  However,  these 
reductions  are  likely  to  disappear  if,  as  proposed  now  under  this 
option,  the  Member  State  of  previous  employment  would  become 
responsible for paying unemployment benefits.184 

This  option  (whether  applied  for  one  or  three  months)  more 
effectively  strikes  a  balance  between  the  protection  of  workers  and 
the  protection  of  unemployment  insurance  schemes  in  the  Member 
State of last activity as they require a certain degree of integration in 
the  labour  market  and  the  insurance  system  of  the  State  of  last 
activity  before  benefits  become  due.  This  applies  in  particular  for 
option  2b.  The  rights  of  the  workers  remain  safeguarded  if  they 
become entitled to unemployment benefits from the Member State of 
previous activity although such export shall be limited to a period of 
six months.  

Both options are coherent with the wider EU objective of supporting 

Risk of fraud and abuse 

+ 

Fair  burden  sharing  between 
Member States 

++ 

Mobility 

0 

Coherence  with  General, 
Specific 
and  wider  EU 
Objectives: 

+ 

the 

EU 

exercise 

Continue  the  modernisation  of 
the 
Security 
Social 
Coordination  Rules  by  further 
of 
facilitating 
citizens'  rights  while  at  the  same 
time ensuring legal clarity, a fair 
and  equitable  distribution  of  the 
financial  burden  among 
the 
institutions of the Member States 
administrative 
involved 

and 

179 Tables 3-1, 3-2, 3-3 and 3-4, Annex XVII. 
180 Page 23, Annex XVII. However, it was possible to quantify (minimal) changes for the Member State of previous employment, but only 
for  the  previous  version  of  the  option,  which  did  not  foresee  the  Member  State  of  previous  employment  becoming  competent  for 
unemployment benefits: see Tables 3-5, 3-6, 3-7, 3-8, Annex XVII. 
181 Annexe IV, XIX . This analysis was based upon Behavioural (dis)incentives to move to another Member State to take up employment 
there can be linked to the costs of moving, the (long-term) perspective of staying in employment in the new Member State set off against 
the risk of falling unemployed and the level of benefits in the previously competent Member State. 

182 Figure 4.1, Annex XIX. 
183 Page 22, Annex XIX. 
184 Pages 29-30, Annex XIX. 

EN 

60 

   EN 

 
                                                 
fair mobility (fair for both jobseekers and tax-payers) and increasing 
access to employment opportunities throughout the Union. 

simplicity  and  enforceability  of 
the rules. 

•  Ensure  a  uniform  and 
consistent  application  of 
the 
and 
aggregation 
calculation rules reflecting 
the  degree  of  integration  in 
the Member State. 

•  Ensure  mobile  EU  workers 
benefit  from  protection  of 
rights 

 Ensure  a  proportionate  distribution 
of  financial  burden  between  Member 
States 

5.2.6.5 Impacts of Policy Option 3: Taking into account previous earnings if a person has 
worked less that one month (sub-option 3a) or three months (sub-option 3b) in the competent 
Member State 

Policy Option 3: Taking into account of previous earnings if a person has worked less than one (sub option 
3a) or three months (sub option 3b) in the competent Member State 

Social impacts 

Clarification 

Simplification 

+/- 

+/- 

Protection of rights 

+/- 

Economic impacts 

Financial impact 

- 

Clarity  of  the  legal  rule  on  aggregation  will  be  improved  in 
combination with the baseline scenario. 

In  combination  with  the  baseline  scenario,  a  uniform  interpretation 
of the rules on aggregation will be achieved. On the other hand, the 
options would also result in an increase in the administrative burden 
for workers applying for unemployment benefits, as they would have 
to  wait  longer  before  receiving  benefits,  and  they  would  face 
increased 
information 
themselves. 

requirements 

to  provide 

relevant 

the 

This  can  be  to  the  advantage  of  the  unemployed  person  concerned, 
for  example  when  he  or  she  moves  from  a  Member  State  with  a 
higher wage to a Member State with a lower wage. But it could also 
cause a disadvantage in the reverse situation, where the worker could 
be faced with a lower level of unemployment benefits but is residing 
in  a  Member  State  with  a  comparatively  higher  cost  of  living. 
However,  there  is  a  risk  that  the  additional  information  exchanges 
between Member States required to determine the correct salary may 
lead to delays for the determination of the average level of reference 
earnings  and  payment  of  benefits  to  the  disadvantage  of  the 
unemployed person. 

Option 3a would result in a reduction of 3.2% of the budget devoted 
to  the  aggregation  of  unemployment  benefits  in  comparison  to  the 
baseline  scenario  for  the  14  reporting  Member  States;  option  3b 
would  result  in  a  reduction  by  4.1%  in  the  budget  devoted  to  the 
aggregation of unemployment benefits.  

It would have a positive budgetary impact on Belgium (€ 1.4 million 

EN 

61 

   EN 

 
 
 
Impact on fundamental rights 

+ 

Other impacts 

Regulatory Costs 

- 

for 3a or € 2.3 million for 3b), Denmark (€ 80.000 for 3a or €78.000 
for  3b),  the  Netherlands  (€26.000  for  3a  or  €40.000  for  3b)  and 
Finland  (€34.000  for  3a  or  €90.000  for  3b),  being  Member  States 
with a higher level of wages, compared to the Member States where 
the  mobile  EU  workers  were  previously  working.  There could  be  a 
negative financial impact for Bulgaria (€ 36.000 for 3a or €230.000 
for 3b), Latvia (€ 5.000 for 3a and 3b), Hungary (€ 5.000 for 3a or 
€6.000 for 3b), Slovakia (€ 200.000 for 3a or €370.000 for 3b) and 
Sweden (€25.000 for 3a and €50.000 for 3b), as relatively low wage 
Member  States,  compared  to  the  Member  State  of  previous 
employment.  

There would be no impact for those Member States which do not use 
previous earnings  as  reference  for  the  calculation  of unemployment 
benefits.185 

These options aim to facilitate the exercise of to the right to engage 
in work in another Member State (Article 15 of the Charter), as well 
as  to  take  a  balanced  approach  to  free  movement  and  the  right  to 
social  security  (Articles  34  and  45  of  the  Charter).  Taking  into 
account  a  previously  earned salary  or  professional  income  does not 
compromise the right to equal treatment (Article 21 of the Charter), 
as  the  unemployment  benefit  paid  to  national  workers  is  generally 
calculated  over  their  average  income  during  a  certain  reference 
period.  The  right  to  property  (Article  17  of  the  Charter)  is  also 
respected  as  this  sub  option  does  not  affect  the  entitlement  to 
unemployment benefits as such. 

These  option  will  have  a  significant  effect  on  the  administrative 
burden  of  institutions,  as  they  may  become  obliged  to  deal  with  a 
variety of different salary statements of other Member States and to 
interpret  the  content  thereof.  The  options  would  also  lead  to  an 
increase in man hours devoted to collect information on the income 
earned in the previous Member State and to calculate the amount of 
unemployment benefits. It is estimated that there will be an increase 
by  28-9%  in  the  administrative  tasks  of  Member  States  of  last 
employment,  mainly  due  to  an  increase  in  man  hours  devoted  to 
collect information and calculate unemployment benefit.  

This  may  translate  into  an  increase  in  the  total  annual  cost  of 
handling  aggregation  of  unemployment  benefits  for  Germany  (€ 
8,700 for 3a or €43,000 for 3b), Denmark (€ 700 for 3a or €900 for 
3b) and the Netherlands (€ 1,300 for 3a or €1000).186  

Also, a further increase could be expected for Germany (€ 4,800 for 
3a and b) and Denmark (€ 900 for 3a and b) which as Member State 
of  previous  employment  have  to  provide  the  Member  State 
the 
responsible 
unemployment benefits with additional information.187  

aggregating  periods 

calculating 

and 

for 

This  option  would  also  result  in  an  increase  in  the  administrative 
burden  for  workers  as  they  would  face  increased  requirements  to 
provide the relevant information themselves188. 

185 Ireland, Malta, Poland and the United Kingdom. 
186 Tables 3-1, 3-2, 3-3 and 3-4, Annexe XVII. 
187 Tables 3-5, 3-6, 3-7, 3-8, Annexe XVII. 
188 Page 25, Annexe XVII.  

EN 

62 

   EN 

 
                                                 
From  the  point  of  view  of  the  Member  States,  changing  to  the 
calculation  mechanism  in  such  a  way  could  contribute  to  reducing 
'possible’ artificial conduct to obtain an unfair advantage189. On the 
other  hand,  this  sub  option  could  also  provide  a  disincentive  for  a 
person to accept employment in a lower wage Member State if this 
person  receives  an  unemployment  benefits  which  are  based  on  a 
much higher salary or professional income.190 

This option does not contribute to a fairer sharing of burden between 
Member  States.  Although  it  could  for  higher  wage  Member  States 
mean that the amount of the unemployment benefits would be lower, 
lower-wage Member State may be required to pay a higher amount 
than  under  national  law.  This  may  also  happen  in  cases  where  the 
beneficiaries have paid a relatively small part of the contributions. 

A moderate reduction in the mobility flows could occur as a result of 
this  option,  notably  in  Denmark  (up  to  1.9%  for  3a  and  b)  and  in 
Italy  (up  to  1.7%  for  3a  and  2.2%  for  3b)191.  These  results  mainly 
concern  flows  of  mobile  EU  citizens  coming  from  Poland  and 
Romania towards Germany, Denmark, Italy, the Netherlands and the 
United  Kingdom  and  coming  from  the  United  Kingdom,  Germany 
and Italy towards France.192 

Options  3a  and  b  aim  at  establishing  a  better  reflection  of  the 
previously  earned  reference  salary  or  professional  income  in 
calculating  the  level  of  the  unemployed  benefits.  Thereby  would 
avoiding ‘random’ results in levels of unemployment benefits based 
on  extreme  short  periods  of  insurance  which  disrupt  the  balance  of 
financial  burden.  However,  they  would  also  entail  an  increase  of 
regulatory  costs,  as  it  would  require  more  exchange  of  information 
between the institutions of the Member States to receive information 
on the last earned salary or professional income, and would thus lead 
to  potential  delays  in  providing  the  unemployment  benefits  to  the 
detriment  of  workers'  rights.  In  addition,  these  options  would 
possibly provide a financial advantage only for Member States with 
a  high  level  of  earnings,  not  for  those  with  a  comparatively  lower 
wage level. The uncertain outcomes means this option therefore may 
be  considered  less  coherent  with  the  wider  EU  objective  of 
supporting  fair  mobility  and  increasing  access  to  employment 
opportunities throughout the Union. 

Risk of fraud and abuse 

+ 

Fair  burden  sharing  between 
Member States 

Mobility 

Coherence  with  General, 
Specific 
and  wider  EU 
Objectives: 

- 

- 

0 

the 

EU 

exercise 

Continue  the  modernisation  of 
the 
Security 
Social 
Coordination  Rules  by  further 
facilitating 
of 
citizens'  rights  while  at  the  same 
time ensuring legal clarity, a fair 
and  equitable  distribution  of  the 
financial  burden  among 
the 
institutions of the Member States 
involved 
administrative 
simplicity  and  enforceability  of 
the rules. 

and 

•  Ensure  a  uniform  and 
consistent  application  of 
the 
and 
aggregation 
calculation rules reflecting 
the  degree  of  integration  in 
the Member State. 

•  Ensure  mobile  EU  workers 
benefit  from  protection  of 
rights 

• 

a  proportionate 
 Ensure 
distribution  of 
financial 
burden  between  Member 
States 

189 See Annex VII, p. 47. 
190 It is true that the same could occur under option 2, if benefits calculated on the earnings received in the previous Member State are paid. 
However, such a payment would only be made for the limited export period of three or six months, whereas option 3 would entail a payment 
based on those earnings for the whole period of entitlement. 
191 Figure 4.1, Annex XIX.  These can be explained by the differences in average earnings in the Member State of origin compared to the 

Member State of destination and average levels of unemployment benefits p26-29 Annex XIX. 

192 Pp. 26-29, Annex XIX. 

EN 

63 

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5.2.6.6 Impacts of Horizontal Policy Option: Clarification regarding the recognition of 
periods for the purpose of aggregation 

Horizontal Policy Option: clarification regarding the recognition of periods for the purpose of aggregation 
of periods of insurance, employment or self-employment 

Social impacts 

Clarification 

Simplification 

+ 

+ 

Protection of rights 

+/- 

Economic impacts 

Financial impact 

0 

Clarity  of  the  legal  rule  on  aggregation  will  be  improved  by 
elminating  the  complications  introduced  by  divergent  interpretation 
of the rules. 

Whilst  differences  between  the  nature  of  the  periods  continue  to 
exist,  a  uniform  interpretation  of  the  rules  on  aggregation  will 
contribute 
the 
institutions concerned. 

the  aggregation  procedure  for 

to  simplifying 

A  uniform  application  of  the  rules  on  aggregation  would  partially 
improve the protection of rights. It would ensure equal treatment in 
all cases where the rules will have to be applied and there is no risk 
that  a  person  might  lose  out  on  rights  due  to  existing  different 
interpretations.  On  the  other  hand,  if  it  were  to  be  decided  that 
periods of (self-) employment are only those periods that provide for 
cover under the legislation of the Member State in which they were 
fulfilled,  this  means  a  restriction  in  comparison  to  the  baseline 
scenario (although this restriction is already applied by a majority of 
Member  States).  Nevertheless,  the  person  that  pursues  an  activity 
which does not afford any cover under an unemployment scheme in 
the competent State does not (and cannot) have any legal expectation 
that such period should give rise to an entitlement to unemployment 
benefit  from  an  unemployment  scheme  of  a  different  State.  On  the 
contrary, the result that such uninsured period will not be taken into 
account by any other State preserves the principle of equal treatment 
and puts national and mobile workers on exactly same footing. 

This option will not have a substantial budgetary impact for Member 
States.  If  there  is  any  marginal  impact  to  be  noticed,  this  would  be 
positive.  The  social  security  coordination  provisions  will  take  into 
account insured periods only reflecting contributions or levies paid to 
the social scheme or public finance.  

Impacts on fundamental rights 

0 

As  regards  option  3,  taking  into  account  a  previously  earned  salary 
or  professional  income  does  not  compromise  the  right  to  equal 
treatment (Article 21), as the unemployment benefit paid to national 
workers  is  generally  calculated  over  their  average  income  during  a 
certain  reference  period.  The  right  to  property  (Article  17)  is  also 
respected  as  this  sub  option  does  not  affect  the  entitlement  to 
unemployment benefits as such. 

EN 

64 

   EN 

 
 
 
 
 
Other impacts 

Regulatory Costs 

Risk of fraud and abuse 

Fair  burden  sharing  between 
Member States 

Coherence  with  General, 
and  wider  EU 
Specific 
Objectives: 

+ 

+ 

+ 

+ 

the 

EU 

exercise 

Continue  the  modernisation  of 
the 
Security 
Social 
Coordination  Rules  by  further 
facilitating 
of 
citizens'  rights  while  at  the  same 
time ensuring legal clarity, a fair 
and  equitable  distribution  of  the 
financial  burden  among 
the 
institutions of the Member States 
involved 
administrative 
simplicity  and  enforceability  of 
the rules. 

and 

The impact is expected to be positive, as Member States will not be 
required to investigate periods of insurance not normally recognised 
or recorded under their national legislation. Thereby the clarification 
could lead to fewer disputes between Member States. 

The  clarification  reduces  the  risk  of  abuses  claims  made  with 
reference  to  periods  of  employment  in  respect  of  which  no  record 
exists. 

This  option  could  contribute  to  a  fairer  sharing  of  burden  between 
Member  States 
that  all  periods  under  all 
circumstances  need  to  confer  an  entitlement  to  unemployment 
benefits in the country in which they are fulfilled. 

it  were  clear 

if 

The horizontal option responds to the general objective as it provides 
for a clear and uniform rule for the recognition of periods completed 
in  another  Member  State  for  aggregation  purposes.  the  purpose  of 
aggregation  providing  ention  the  acquisition  of  unemployment 
benefits.  This  option  is  also  considered  efficient  and  coherent  with 
the  wider  EU  objective  of  supporting  fair  mobility  and  increasing 
access to employment opportunities throughout the Union.  

•  Ensure  a  uniform  and 
consistent  application  of 
the 
and 
aggregation 
calculation rules reflecting 
the  degree  of  integration  in 
the Member State. 

•  Ensure  mobile  EU  workers 
benefit  from  protection  of 
rights 

• 

a  proportionate 
 Ensure 
financial 
distribution  of 
burden  between  Member 
States 

5.2.7  Conclusions 

The baseline scenario, from a merely administrative point of view, is the easiest option to implement 
and it has the support of a large number of stakeholders. It can however lead to uneven results when it 
comes  to  the  protection  of  the  mobile  EU  worker  due  to  the  unilateral  introduction  of  minimum 
periods of insurance or (self-)employment by some Member States. The fact that the requirement of a 
‘genuine’ link with the unemployment insurance system and labour market of a Member State is not 
explicitly expressed in the current rules may lead to unintended gains.  

Option  1  introduces  legal  clarity  and  simplicity  for  unemployed  persons  and  is  relatively  easy  to 
implement from an administrative point of view for the majority of Member States. It also has a minor 
budgetary impact only for those Member States which currently apply a minimum period of insurance 

EN 

65 

   EN 

 
 
 
 
or (self-)employment.  On  the other hand, it fails  like the baseline  scenario to require a genuine link 
with  the  unemployment  insurance  system  in  the  State  of  last  activity.  Eight  delegations193  have 
expressed in the Administrative Commission the view that they could accept option 1 if in return the 
calculation  rule  would  be amended,  or  vice  versa,  as  either  one  of  the  rules  is needed  to  establish  a 
'genuine link' with the unemployment insurance system. This option in itself is therefore not the most 
effective  option  to  strike  a  balance  between  the  aims  of  protecting  mobile  workers  and  requiring  a 
certain  degree  of  integration  in  the  labour  market  and  insurance  system  of  the  State  of  last  activity, 
before it becomes responsible for the payment of benefits. It is neutral in relation to coherence with 
wider EU policy objectives.  

Options  2a  and  2b  more  effectively  strike  a  balance  between  the  protection  of  workers  and  the 
protection of unemployment insurance schemes in the Member State of last activity as they require a 
certain degree of integration in the labour market and the insurance system of the State of last activity 
before benefits become due. This applies in particular for option 2b. The rights of the workers remain 
safeguarded  if  they  become  entitled  to  unemployment  benefits  from  the  Member  State  of  previous 
activity  although  such  export  shall  be  limited  to  a  period  of  six  months.  Taking  into  account  the 
relative  costs  compared  to  the  effectiveness  of  achieving  objectives  option  2b  offers  superior 
efficiency  to  option  2a  (both  are  more  efficient  than  the  baseline).  The  idea  to  introduce  a 
reimbursement  mechanism 
the 
reimbursement mechanism for unemployed frontier workers show that such a mechanism is likely to 
create disputes and delays between the institutions involved. Both options are coherent with the wider 
EU  objective  of  supporting  fair  mobility  (fair  for  both  jobseekers  and  tax-payers)  and  increasing 
access to employment opportunities throughout the Union. 

instead  has  been  discarded,  as 

the  current  problems  with 

Options 3a and 3b aim at establishing a better reflection of the previously earned reference salary or 
professional income in calculating the level of the unemployed benefits. They would avoid ‘random’ 
results in levels of unemployment benefits based on extreme short periods of insurance. However, this 
aim would be achieved in a less effective and efficient way than under option 2194. They would also 
entail an increase of regulatory costs, as it would require more exchanges of information between the 
institutions  of  the  Member  States  to  receive  information  on  the  last  earned  salary  or  professional 
income, and would thus lead to potential delays in providing the unemployment benefits. In addition, 
these options would possibly provide a financial advantage only for Member States with a high level 
of earnings, not for those with a comparatively lower wage level. The uncertain outcomes means this 
option  therefore  may  be  considered  less  coherent  with  the  wider  EU  objective  of  supporting  fair 
mobility (fair for both jobseekers and tax-payers) and increasing access to employment opportunities 
throughout the Union. 

The horizontal option responds to the general objective as it provides for a clear and uniform rule for 
the recognition of periods completed in another Member State for aggregation purposes. Taking into 
account  the  negligible  anticipated  costs  of  this  option  compared  to  the  potential  success  in  realising 
objectives  this  option  is  also  considered  efficient  and  coherent  with  the  wider  EU  objective  of 
supporting fair mobility (fair for both jobseekers and tax-payers) and increasing access to employment 
opportunities throughout the Union.  

5.3. 

Export of Unemployment Benefits 

5.3.1  Problems with the limited export of unemployment benefits and drivers behind them 

193 The Bulgarian, Italian, Portuguese, Belgian, Estonian, Irish, Polish and Swedish delegations. 
194 It should be borne in mind, that unemployment benefits paid by the Member State of previous activity in accordance with options 2 are 
also calculated on the basis of reference earnings received in those States, and not on the earnings received for only a short period in the 
Member State of last activity.  

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5.3.1.1 There are currently low numbers of persons exporting their unemployment benefits 
and the period of export does not give a realistic chance for a jobseeker to find work in 
another Member State 

A worker who has acquired an entitlement to unemployment benefits has a right to look for a job in 
another Member State while retaining the unemployment benefit for a limited period of time. Under 
the current rules the period of export is limited to a minimum of three months and a maximum of six 
months. 

The right to export unemployment benefits is either certified by the Portable Document U2 (PD U2 – 
Retention of unemployment benefits) or at request of the institution in the host State by the Structured 
Electronic  Document  U008  (SED  U008).  Statistical  data  about  the  number  of  PD  U2/SED  U008 
issued195 shows that the  mobility of jobseekers is rather limited, because only approximately 27.000 
unemployed persons have exported their unemployment benefits in 2013 and in 2014196 representing 
on  average  only  1  out  of  1.000  unemployed  persons  received  this  document  in  2013  and  in  2014. 
Spain (3,128), Portugal (1.751), Germany (± 1.600) and France (1.510) issued the highest number of 
PD U2 during the second semester of 2013, whereas Malta (6) and Romania (3) issued the fewest.  

There is anecdotal evidence that the period of three months generally considered too short to respond 
to the aspiration of unemployed persons that they will find abroad. Nine individual respondents to the 
public consultation had requested the export of unemployment benefits at some point in their lives.197 
Out of these nine, five reported problems when asking to receive their benefits abroad. In the public 
consultation,  a  mobile  worker  living  in  Sweden  and  with  a  full-time  job  pointed  out  that  “With  the 
current high unemployment and fierce competition it is almost impossible to find a job in 3 months, 
considering you have to create a new network, learn a new language, get into a new culture and the 
society as a whole. I would really like to see the rules changed to be the same for every Member State 
concerning exporting / receiving unemployment benefit for at least 6 months."  

195  Pacolet,  J.  and  De  Wispelaere,  F.,  Export  of  unemployment  benefits  –  PD  U2  Questionnaire,  Network  Statistics  FMSSFE,  European 

Commission, June 2014, p25. 

196  Pacolet,  J.  and  De  Wispelaere,  F.,  Export  of  unemployment  benefits  –  PD  U2  Questionnaire,  Network  Statistics  FMSSFE,  European 

Commission, June 2014, 25 p. 

197 A public consultation between December 2012 and February 2013 invited citizens and organisations to provide their views on  
the main problems linked to the export of unemployment benefit. 

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There  is  also  statistical  evidence  that  a  prolongation  of  the  export  period  is  likely  to  enhance  the 
chances of the unemployed person to find a job. The available statistical data show an average success 
rate  between  11%  (average  percentage  of  the  reporting  sending  Member  States)  and  8%  (average 
percentage  of  reporting  receiving  Member  Sedates).  The  figures  also  show  an  increase  of  the  total 
success rate by 3 percentage points in case a prolongation was granted.198 

Drivers behind these problems are that Member States do not consistently promote the right to export 
unemployment benefits. Under the current rules, the competent institution can decide if, depending on 
the  circumstances  of  the  case,  an  extension  of  the  export  period  of  another  three  months  will  be 
granted. Currently nine Member States structurally do not grant an extension of the export period,199 
even if this would increase the person's chances of finding employment in one of these Member States.  

Furthermore,  the  negotiations  in  Council  on  the  Chapter  on  Unemployment  Benefits  in  the 
coordination Regulations showed that Member States are reluctant to grant a prolonged export of their 
unemployment  benefits.  This  is  not  only  due  to  considerations  of  financial  interests,  but  also  by 
concerns regarding the possibilities to  supervise  the jobseeking activities of the unemployed person. 
One of the drivers for the more stringent attitude of some countries seems to be inspired by (potential) 
difficulties in the mutual cooperation between Member States for monitoring the person's jobseeking 
activities, as well as the fear that the person is not genuinely looking for work. These factors seem to 
be  mutually  reinforcing  and  give  a  clear  signal  that  the  mutual  cooperation  mechanism  needs  to  be 
strengthened. This is also confirmed by the online consultation by Deloitte Consulting200 which shows 
that  the  current  cooperation  mechanism  is  not  regarded  as  a  sufficient  safeguard  that  all  necessary 
checks  are  performed  due  to  the  fact  that  employment  services  in  the  host  State  have  no  financial 
incentive to verify jobseeking efforts undertaken by those unemployed persons. Member States find it 
much  more  difficult  to  trust  information  confirming  active  jobsearch  from  foreign  employment 
services  institutions  than  from  their  own  institutions.  Public  authorities  in  Austria,  Czech  Republic, 
Hungary,  Italy,  Lithuania,  the  Netherlands,  Poland  and  Portugal  who  believe  that  the  export  of 
unemployment  benefits  could  lead  to  increased  risk  of  misuse  of  rights,  proposed,  among  other 
measures,  that  the  host  Member  State  should  assume  more  responsible  for  jobseekers  who  have 
exported their unemployment benefit from another Member State.201 
However, there is no evidence202 that points to a wide-scale abuse of the system. The Final Report of 
the Ad-hoc Group on Combatting Fraud and Error through the exchange of personal data within the 
framework  of  the  Administrative  Commission203  shows  that  difficulties  and  obstacles  in  exchanging 
data  do  not  derive  from  the  Regulations,  but  are  rather  due  to  a  lack  of  cooperation,  prioritisations, 
long delays in answering and fragmented replies, as well as to limitations in domestic law in certain 
Member States to exchange personal data with institutions across the border. It is anticipated that these 
issues  will  be  greatly  reduced  by  the  introduction  of  the  Electronic  Exchange  for  Social  Security 
Information (EESSI) scheduled for launch by the end of 2016 with a deadline for full implementation 
in all Member State by the end of 2018 which will introduce common structured electronic documents 
and  a  uniform  procedure  for  all  national  authorities  to  follow  when  processing  claims  for  social 
security  benefits  has  the  potential  to  address  the  concerns  raised  by  competent  Member  States 
concerning the need to monitor a jobseeker's compliance with active labour market requirements when 
seeking work in another Member State.204 

Increased mobility can play a key role in tackling EU-wide unemployment. Whilst some areas of the 
EU  are  experiencing  an  acute  unemployment  crisis,  there  exist  about  2  million  positions  that  have 

198  Pacolet,  J.  and  De  Wispelaere,  F.,  Export  of  unemployment  benefits  –  PD  U2  Questionnaire,  Network  Statistics  FMSSFE,  European 
Commission, October 2015, 25 p. 15. 
199 Cyprus, Denmark, Finland, France, Hungary, Italy, Ireland, the Netherlands and the United Kingdom. 
200  Mentioned  by  representatives  of  public  authorities  from  Austria,  Hungary,  Czech  Republic,  Ireland,  Italy,  Lithuania,  the  Netherlands, 
Poland, Portugal and Slovenia. 
201 See Annex II, p. 7. 
202 Following the annual discussion on Fraud and Error within the framework of the Administrative Commission. 
203 To be published on https://Circabc.europa.eu. 
204Annex VI, p17.  

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remained unfilled for a significant period of time, according to information by the EURES network. 
Export of unemployment benefit allows a citizen to search for work in another Member State without 
becoming a burden to the social security system of that State. Instead, they continue to receive benefits 
to which they contributed in their 'home' Member State. The consequences of the comparatively small 
percentage  of  persons  using  the  possibility  to  look  for  employment  in  another  Member  State  points 
very  clearly  that  the  current  rules  are  not  achieving  their  full  potential.  EU  rules  on  export  and 
coordination  should  take  this  into  account,  whilst  at  the  same  time  recognising  the  concerns  of 
Member States in this respect.  

5.3.1.2 Member States apply inconsistent criteria in determining whether to grant the 
extension of the export period leading to comparative disadvantages for persons looking for 
work in another Member State  

Under  the  current  rules  Member  States  have  a  discretion  to  determine  whether  they  export 
unemployment benefits only for the minimum period of three months or the maximum period of six 
months.  However,  the  restrictive  attitude  from  Member  States  towards  granting  export  in  general  is 
also  reflected  in  granting  an  extension  of  the  export  period  beyond  three  months.  The  results  of  a 
survey carried out by the trESS network205 and a questionnaire launched within the framework of the 
Administrative Commission206 show that still a considerable number of Member States do not let their 
institutions make use of this discretion at all, or only exceptionally:  

•  3  months,  no  extension:  Cyprus,  Denmark,  Finland,  France,  Croatia,  Greece,  Sweden,  Hungary, 

Italy, Ireland, the Netherlands and the United Kingdom; 

•  3 months, possibility to extend: Austria, Belgium, Bulgaria, Spain, Germany, Luxembourg, Malta, 

Romania, Estonia, Latvia, Lithuania, Slovenia, Slovakia, Poland, Portugal; 

•  6 months by default207: Czech Republic and Malta. 

The  main  reasons  for  not  granting  an  extension  of  the  export  period  vary  as  well.  Sometimes,  the 
national  legislation  does  not  allow  for  an  extension  or  does  not  contain  any  criteria  for  granting  an 
extension  (e.g.  the  United  Kingdom).  Other  Member  States  have  developed  their  own  criteria.  In 
Germany for example, the expected national demand for labour in the coming months, the individual 
reasons for a preferred work abroad and better integration opportunities are taken into account in the 
decision of whether to extend the export period.  

Luxembourg  and  Romania  grant  the  extension  every  time  upon  an  individual  request.  In  some 
Member  States,  such  as  Belgium,  the  extension  of  export  is  exceptional  and  can  only  be  granted  if 
there is proof that the intensive search for employment and a further stay are indispensable in the light 
of  ongoing  applications.  Similarly,  the  Austrian  institutions  request  proof  of  whether  there  is  a  job 
offer  available  in  the  home  country  before  grating  an  extension  and  the  Spanish  authorities  ask  the 
unemployed  person  to  prove  that  he  or  she  is  likely  to  find  work  during  the  extended  period.  Also, 
Latvia, Lithuania, Estonia, Slovenia, Bulgaria and Slovakia examine every case individually after the 
expiry of the the three months of export. 

Unemployed persons in countries which never grant an extension of the period of export are put at a 
disadvantage  compared  to  those  who  get  their  benefit  from  more  ‘generous’  institutions.  They 
therefore have more limited support in their search for work in another Member State.  

The consequence of this problem is that there is inconsistent treatment of applications to extend the 
period  of  export  of  unemployment  benefits  across  the  EU  and  mobile  jobseekers  face  inconsistent 
treatment  when  they  seek  work  in  another  Member  State  depending  on  which  Member  State  is 

205Think 

tank 

report 

2012,  Coordination 

of  Unemployment 

Benefits, 

to 

be 

consulted 

at: 

http://www.tress-

network.org/tress2012/EUROPEAN%20RESOURCES/EUROPEANREPORT/trESS_ThinkTankReport2012.pdf. 

206  Pacolet,  J.  and  De  Wispelaere,  F.,  Export  of  unemployment  benefits  –  PD  U2  Questionnaire,  Network  Statistics  FMSSFE,  European 

Commission, June 2014, 25 p. 

207 i.e. PDs U2 had immediately been granted for the maximum period from the outset. 

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competent for payment of the unemployment benefits. Once again this suggests the EU social security 
rules  are  not  achieving  their  full  potential  to  support  the  internal  market  by  facilitating  intra-EU 
mobility in particular to target asymetrical spikes in unemployment or to address skills mismatches or 
shortages in skilled workers. 

5.3.2  Baseline scenario 

There  are  about  24.000  persons  exporting  unemployment  benefits  to  another  Member  State, 
representing only 0.1% of all unemployed persons in the EU208. Only limited data is available on the 
countries to which unemployed persons export their benefits in table 65 in Annex V.209 From that table 
it follows that persons mainly apply to export their benefits to a neighbouring country. For example, 
Belgium  issued  the  highest  number  of  PD  U2  forms  for  persons  moving  to  France.  Unemployed 
persons  in  Poland,  Denmark  and  the  Netherlands  tend  to  look  for  work  in  Germany.  The  United 
Kingdom  is  also  a  preferred  destination  of  jobseekers,  most  probably  for  linguistic  reasons.  On  the 
basis  of  the  current  spread  over  the  destination  countries,  a  large  influx  of  unemployed  persons  in 
either of these countries not to be expected. 

Based on the projections of the 2015 Ageing report, assuming that the unemployment rate in the EU 
will  diminish  between  2015  and  2020,  and  assuming  that  the  rate  of  unemployed  persons  exporting 
unemployment  benefits  will  remain  stable  at  0.1%,  then  we  could  expect  that  the  number  of  people 
exporting unemployment benefits when moving abroad under the current scenario would decrease to 
around  23,000  in  2020  and  19,000  in  2030.  However,  as  this  report  only  describes  the  effect  of  the 
demographic  development  and  as  other  factors  such  as  the  general  evolution  of  the  economy  in  the 
different Member States has a more decisive impact on the rate of unemployment and on movements 
of unemployed persons between Member States, these projections alone do not necessarily present the 
likely future trends in this area. 

Providing the right to export unemployment benefits is, in itself, not sufficient to encourage people to 
work  where  they  are  most  needed,  or  where  the  chances  of  finding  a  job  are  higher.  A  person's 
motivation to move is always a combination of 'push factors' in the home country and 'pull factors' in 
the  receiving  country.  The  decision  to  move  is  inspired  by  better  prospects  for  the  future  and  the 
potential costs are carefully weighed against the knowledge of the potential costs associated with the 
migration210. If we look at the reasons to move for unemployed persons, 24% declared that they wish 
to  move  to  a  particular  country  due  to  the  employment  opportunities  there,  while  43%  wish  to  earn 
more money.211 

Not  undertaking  action  in  the  field  of  export  of  unemployment  benefits  would  maintain  the  current 
divergences  as  regards  the  application  of  the  existing  rules.  It  would  also  stifle  the  mobility  of 
jobseekers  between  national  labor  markets  and  not  only  deprive  them  of  a  chance  of  finding  more 
suitable employment, but also the Member States of a chance to fill in persistent vacancies and to even 
out skill mismatches. 

The Electronic Exchange for Social Security Information (EESSI) scheduled for launch by the end of 
2016  with  a  deadline  for  full  implementation  in  all  Member  State  by  the  end  of  2018  which  will 
introduce  common  structured  electronic  documents  and  a  uniform  procedure  for  all  national 
authorities to follow when processing claims for  social security benefits has the potential to address 
the  concerns  raised  by  competent  Member  States  concerning  the  need  to  monitor  a  jobseeker's 

208 European Commission, Export of Unemployment Benefits (2015). 
209  See  also  Pacolet,  J.  and  De  Wispelaere,  F.,  Export  of  unemployment  benefits  –  PD  U2  Questionnaire,  Network  Statistics  FMSSFE, 
European  Commission,  June  2014,  25  p.  However,  no  data  with  regard  to  the  bilateral  flows  between  Member  States  are  available. 
Different reasons to export the unemployment benefit might appear (a lower unemployment rate compared to the competent Member State, 
familiarity with the Member State where looking for employment, ‘return’ of the mobile worker to his/her country of birth etc.). 

210 European Policy Centre ,Making progress towards the completion of the Single European Labour Market, EPC Issue Paper no. 75, May  
2013, p. 17. http://www.epc.eu/documents/uploads/pub_3529_single_european_labour_market.pdf. and Drinkwater and Garapich, Migration  
Plans and Strategies of Recent Polish Migrant to England and Wales: Do they Have Any and How do they Change? NORFACE-ERA NET  

(TEMPO), Nov. 2013. 

211 European Commission, Geographical and labour market mobility, Special Eurobarometer Review N. 337, June 2010, p. 36. 

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compliance  with  active  labour  market  requirements  when  seeking  work  in  another  Member  State. 
Electronic  exchange  will  provide  a  more  consistent  and  efficient  means  for  Member  States  to 
cooperate and exchange information in cases of export of unemployment benefits.212  

5.3.3 

 Objectives for review on the export of unemployment benefits  

The  general  policy  objective  of  this  initiative  is  to  continue  the  modernisation  of  the  EU  Social 
Security Coordination Rules by further enabling the citizens to exercise their rights while at the same 
time  ensuring  legal  clarity  and  a  fair  and  equitable  distribution  of  the  financial  burden  among  the 
institutions of the Member States involved.  

In  relation  to  the  rules  on  export  of  unemployment  benefits,  this  means  in  particular  to  ensure  that 
jobseekers can benefit from the opportunities of the European labour market  and exert their right to 
free movement without having to fear a loss of their benefit entitlements. As long as they can enjoy 
their  acquired  rights  to  unemployment  cash  benefits,  they  are  less  likely  to  become  a  burden  on  the 
welfare system of the host Member State to which they went in order to seek employment there. It also 
generally  supports  financial  equilibrium  within  the  internal  market  by  serving  to  mitigate  cyclical 
adjustment  measures  in  response  to  asymmetric  shocks213  spikes  in  unemployment  and  skill 
mismatches between Member States.214 

In view of this general objective, the specific objective in this field can be defined as follows: 

(cid:190)  Protection of rights of unemployed persons when they move to another Member State to take up 

employment there. 

(cid:190)  Promotion of integration of unemployed persons into the labour market across the EU.  

(cid:190)  Provision of a systematic and easy to administer cooperation and control mechanism in order 

to monitor the fulfilment of their rights and obligations. 

212Annex VI, p17.  
213 Labour Market and Wage Developments in Europe 2015, European Commission. 
214 ESDE 2015. 

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5.3.4  What are the various options to achieve the objectives concerning the export of 
unemployment benefits?  

5.3.4.1 Option 0: baseline scenario 

Under  the  status  quo,  export  of  unemployment  benefits  can  be  granted  for  a  period  of  three  months 
with a possibility for extension of up to six months. 

5.3.4.2 Option 1: Extend the period for export of unemployment benefits to a minimum period 
of 6 months (or end of entitlement period if shorter) 

This  option  can  be  combined  with  the  previous  options  as  all  unemployed  persons  have  the 
opportunity to look for a job in another Member State while maintaining their right to unemployment 
benefits. Clear guidance, provided by the Commission, on the correct application of the export period 
of  unemployment  benefits  could  be  helpful  to  attain  more  uniformity  in  the  interpretation  of  this 
particular export rule.  

The time limit of 6 months is chosen for several reasons and aims at increasing the number of persons 
exporting  their  benefit.  The  first  one  is  the  increased  chances  of  finding  a  job  after  a  period  of  6 
months.  Based  on  figures  provided  by  9  Member  States,  the  average  success  rate  increases  by  3 
percentage points if an extension from 3 to 6 months is granted. 215 

215  Pacolet,  J.  and  De  Wispelaere,  F.,  Export  of  unemployment  benefits  –  PD  U2  Questionnaire,  Network  Statistics  FMSSFE,  European 
Commission,  October  2015.  Based  on  figures  provided  for  2014  on  PDs  U2  or  SEDs  U008  issued  in  the  year  2014,  they  calculated  an 
average total success rate, i.e. the percentage of unemployed persons exporting their unemployment benefit who have found work abroad of 
between 11% (average percentage of the reporting sending Member States) and 8% (average percentage of the reporting receiving Member 
States). This rate increases by 3 percentage points in case of prolongation of the export period up to 6 months. 

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The period of six months also coincides with the period that was seen as appropriate for a person to 
find  a  job  independently  of  active  labour  market  assistance216.  It  is  also  the  time  limit  awarded  to 
jobseekers under EU law217 for having a right-to-reside as a jobseeker. An extension of the period will 
also  be  beneficial  for  the  unemployed  cross  border  workers  who  wish  to  return  to  their  State  of 
residence  and  look  for  work  there.218  It  is  also  beneficial  to  mobile  EU  workers  who  have  not 
completed  a  sufficient  periods  of  insurance  or  (self-)employment  to  apply  for  aggregation  of 
periods.219  In  addition,  the  competent  institution  paying  the  unemployment  benefits  can  decide  to 
extend export of unemployment benefits beyond the period of six months on the basis of an individual 
assessment of the chances and efforts made to find employment in another Member State. 

5.3.4.3 Option 2: Provide for export of unemployment benefits until the end of the entitlement 
period. 

This option stipulates that an unemployed person has the right to search for a job in another Member 
State  and  to  receive  unemployment  benefits  for  as  long  as  the  entitlement  to  such  benefits  under 
national  legislation  of  the  competent  Member  State  lasts.  The  availability  for  the  labour  market  in 
another  Member  State  should  be  considered  parallel  to  the  availability  to  the  labour  market  in  the 
competent Member State. 

In  relation  to  both  options,  ensuring  improved  support  for  Member  States  to  address  their  concerns 
over  the  administrative  burden  caused  by  benefit  coordination  is  important.Therefore  in  relation  to 
both options extension of the export period will be coupled with a reinforced cooperation mechanism 
to  facilitate  the  information  exchange  between  Member  States  and  to  increase  mutual  trust  over 
performing  effective  checks  on  the  person's  jobseeking  activities.  The  verification  procedure  will 
consist of: 

a) The possibility to ask for 'ad hoc' checks by the employment services in the receiving State. 

b) Introducing a system of automatic reporting by the employment services in the ‘receiving State’ to 
the employment services of the competent Member State. An automatic process, expedited by EU law, 
could help to remove much of the problems quoted by administrations involving delays in receiving 
the information they need to verify jobseeking activities. 

c) Introducing a legal basis in Regulation (EC) No 883/2004 for ''data matching" (i.e. the comparison 
of  bulk  data  of  insured  persons).  Such  data  transmission  can  take  place  in  a  case  where  there  is  no 
actual doubt about the accuracy of the information provided to enable Member States to identify any 
fraud or error in the proper implementation of the Regulations. For example, it allows Member State A 
to provide Member State B with personal data which Member State B will check against its own data 
in order to identify any inconsistencies which would affect the proper application of the Regulations. 
This "data-matching" may be used by Member States to identify whether there is fraud and error in the 
payment of unemployment benefits to persons living outside the paying State, by comparing lists of 
persons  in  receipt  of  such  exported  benefits  living  in  State  B  against  data  held  on  persons  in 
employment by that State. 

Under  this  option,  the  delivery  of  support  services  to  assist  any  person  interested  in  matching, 
placement  and  recruitment  through  the  EURES  network  can  be  an  important  complement  to  the 
person's jobseeking activities220.  

216 Grubb, David, Key features of successful activation strategies, PES to PES dialogue conference “Activation and integration: working with  
individual action plans” OECD Employment and Analysis Policies Division, Brussels, 8-9 March 2012. 
217 Antonissen C-292/89 ECLI:EU:C:1991:80158, 30.4.2004, p. 77.. 
218 For more information about the rules that apply to cross-border workers see paragraph 5.4 
219 For more information about the rules that apply to aggregation of unemployment benefits see paragraph 5.2. 
220 Receiving assistance with matching, recruitment and placement for, including in gaining access to both active labour market measures and  
information and advice on social security as proposed in the Communication on the reformed EURES network. 

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5.3.5  Stakeholder Support on amending the rules on the export of unemployment benefits 

5.3.5.1 Option 1: Extend the period for export of unemployment benefits to a minimum period 
of 6 months 

Based  on  the  first  consultation  in  the  Administrative  Commission  of  Member  States'  opinions  as 
regards the extension of the export period, 8 delegations221 have indicated to support his option.16% of 
the individual respondents to the public consultation supported this option and no clear preference was 
identified among the respondents from social partners. 

5.3.5.2 Option 2: Provide for export of unemployment benefits until the end of the entitlement 
period 

None of the experts within the Administrative Commission seemed to support this option explicitly. 
Three delegations222 seemed flexible to introduce this option. The results of the online consultation by 
Deloitte Consulting show that 79% of the public authorities think that the risk of misuse or abuse of 
rights  is  particularly  high  if  the  unemployment  benefits  would  be  provided  until  the  end  of  a 
persons’entitlement, according to the rule of the Member State which provides them. 

On the other hand, it seems that almost 60% of the individual respondents to the public consultation 
support this option and 18% of the representatives of social partners. 

All  delegations  recognised  the  importance  of  reinforcing  the  cooperation  mechanism  while  keeping 
the administrative burden on an acceptable level. 

5.3.5.3 What are the impacts of the Different Options on the export of unemployment benefit  

The  options  have  been  compared  to  the  baseline  scenario  and  with  regard  to  their  effectiveness  in 
achieving  the  specific  objectives  of  the  initiative,  their  efficiency  (cost-effectiveness/even  burden 
sharing), coherence with the general objectives of the EU and their impacts as assessed above.223  

Figures for all EU-Member States on the export of unemployment benefits have become available via 
the administrative PD U2 Questionnaire launched in 2015 within the framework of the Administrative 
Commission (for 2013). Additional data available for Belgium has been used to describe the impact of 
the prolongation period on finding a job abroad. Finally, figures of Eurostat (based on the LFS) were 
used to calculate the average duration of the unemployment period.  

221 Czech Republic, Luxembourg, Portugal, Italy, Malta, Slovakia, Slovenia and Romania. 
222 Czech Republic, Italy and Portugal. 
223  Secondary  impacts  are  not  considered  in  the  final  comparison  in  recognition  of  the  limitations  of  the  data  available  to  conduct  this 
assessment. 

EN 

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5.3.5.4 Summary of the impact of different options concerning the export of unemployment benefits 

Type of impact  Clarification 

Simplification 

Protection 
rights 

of 

Fundamental 
rights 

Economic 
impacts 

Regulatory 
costs 

Risk  of  fraud 
and abuse 

Equitable 
burden sharing 
Member State 

Coherence 
with  General, 
Specific 
and 
EU objectives 

Overall 
Effectiveness 

Overall 
Efficiency 

(cost 
effectiveness 

vs 

Baseline 
Scenario 

Option 1 

Option 2  

0 

+224 

+226 

0 

+ 

+ 

0 

+ 

+ 

0 

+ 

+ 

0 

+/-225 

+/- 

0 

- 

- 

0 

+ 

+ 

0 

+ 

+/- 

0 

0 

0 

++ 

+ 

++ 

+ 

++ 

+ 

224 Duration of export up to 6 months is no longer at the discretion of Member State. 
225 The economic impact is expected to be neutral, because the duration of export does not affect the overall period of entitlement.  
226 No discretion as regards duration of export. 

EN 

75 

EN 

 
  
 
 
 
                                                 
5.3.5.5 Impact of Policy Option 1: extension of the export period up to a minimum of 6 
months 

Policy Option 1: extension of the export period up to a minimum of 6 months 

Social impacts  

Clarification 

Simplification 

Protection of rights 

Economic impacts 

+ 

+ 

+ 

This  option  eliminates  the  uncertainty  derived  from  the  degree  of 
flexibility  applied  by  the  national  institutions.  There  would  be  a 
clear  and  uniform  standard  for  all  persons  wishing  to  take  their 
unemployment  benefits  with  them  when  looking  for  a  job  in 
another Member State. 

This option would make an end to the widely varying practices that 
currently  exist  across  Member  States.  The  period  of  six  months 
also  coincides  with  the  periods  that  was  seen  as  appropriate  for 
jobsearch  within  the  framework  of  freedom  of  movement  and  in 
which persons can find a job independently of active labour market 
assistance227.  

This  option  would  ensure  that  the  persons  concerned  can  retain 
their entitlement to unemployment benefit for a longer period than 
under  the  existing  rules.  It  would  also  allow  them  to  make  better 
use  of  the  possibilities  offered  by  the  host  Member  State  to  find 
suitable employment.  

Financial impact 

+/- 

Impacts on fundamental rights 

+ 

Other impacts 

Regulatory Costs 

- 

This  option  does  not  affect  substantially  the  duration,  nor  the 
amount of unemployment benefits paid by the competent Member 
State.  It  does  not  have  any  significant  financial  impact  on  the 
Member States, either at an individual or aggregate level, as it does 
not create a right for unemployment benefits, but only maintains an 
existing right to benefit in case of search of employment in another 
Member State.  

This option contributes to the freedom to choose an occupation and 
the right to engage in work in another Member State (Article 15), 
as  well  as  to  a  better  protection  of  rights  for  workers  who  have 
made use of their right to free movement (Article 45). There is no 
impact  on  the  right  to  property  (Article  17)  as  acquired  rights  to 
unemployment benefits are maintained. 

Improving  and  standardising  unemployment  benefit  export 
between  Member  State,  including  introducing  a  new  co-operation 
and  control  mechanism,  will  contribute 
the 
administrative burden that is often cited by Member States as being 
experienced by their competent institutions. Currently the length of 
time  for  which  Member  States  will  export  unemployment  benefit 

reducing 

to 

227 Grubb, David, Key features of successful activation strategies, PES to PES dialogue conference “Activation and integration: working with 
individual action plans”, OECD Employment Analysis and Policies Division, Brussels 8-9 March 2012. 

EN 

76 

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+ 

+ 

++ 

varies between Member States, necessitating separate processes for 
granting  an  extension  of  the  period  of  export.  Setting  up  the 
reinforced  cooperation  mechanism  requires  an  increased  effort  in 
comparison  to  the  baseline  scenario,  for  the  person  concerned  to 
inform  the  employment  services  and  for  the  employment  services 
to  communicate  the  follow-up  on  the  unemployed  person’s  job 
searching  activities.  It  is  not  expected  that  this  will  have  a 
substantial  impact  on  the  administrative  burden  of  the  individual 
Member  States.  The  total  number  of  PD  U2  forms  issued  is  still 
rather moderate and varies between 0,001% and 1,26% of the total 
population of unemployed persons in 2013.  

Combined  with 
introduction  of  a  reinforced 
cooperation mechanism, it is expected that this option will entail a 
lower risk of fraud and abuse than the current rules.  

intended 

the 

During the export period, the person concerned remains covered by 
the  legislation  of  the  Member  State  which  provides  the  benefit. 
This  reduces  the  risk  that  the  person  concerned  has  to  rely  on 
welfare  benefits  from  the  host  Member  State  if  he  stays  there 
beyond  the  current  minimum  export  period  of  three  months. 
Moreover,  the  investment  that  an  employment  service  in  the  host 
state may make in cooperation activities may pay itself back when 
the person actually succeeds in finding a job in that country, starts 
working and paying social security contributions. 

By  setting  a  minimum  period  for  the  export  of  unemployment 
benefits  that  is  longer  than  the  current  three  months,  option  1  is 
effective  in  providing  opportunities  for  job  searching  activities  in 
another Member State supporting better allocation of labour force 
(and  human  capital)  within  the  internal  market  and  indirectly 
resulting in savings in terms of public funds devoted to payments 
of  unemployment  benefits  and  social  assistance.  228  A  new 
cooperation mechanism that would be more effective and efficient 
than the current one would reduce the fear of fraud and error. This 
option  may  therefore  be  considered  coherent  with  the  wider  EU 
objective  of  supporting  fair  mobility  and  increasing  access  to 
employment opportunities throughout the Union while limiting the 
time in which a jobseeker does not have direct access to activation 
measures and support from the competent Member State. It is also 
aligned with 2013 citizenship report (COM(2013)269) which as its 
key  action  1  refers  to  the  proposal  to  extend  the  export  of 
unemployment benefits to six months. 

Risk of fraud and abuse 

Fair  burden  sharing  between 
Member States 

Coherence 
Specific 
Objectives: 

with 

and  wider 

General, 
EU 

Continue  the  modernisation  of  the 
EU  Social  Security  Coordination 
Rules  by  further  facilitating  the 
exercise  of  citizens'  rights  while  at 
legal 
the  same 
clarity, 
equitable 
a 
distribution  of  the  financial  burden 
the 
among 
and 
Member  States 
administrative 
and 
enforceability of the rules. 

institutions  of 
involved 
simplicity 

time  ensuring 
fair 

and 

the 

•  Ensure 

a  uniform 

and 
consistent  application  of  the 
export rules. 

•  Offer 

jobseekers 

the  best 
chance  of  (re)integrating  into 
the labour market 

•  Provide  for  a  systematic  and 
administer 
to 
easy 
control 
cooperation 
mechanism 
to  monitor  the 
fulfilment  of  obligations  by 
the  jobseeker  in  exchanges 
between Member States 

and 

228 European Policy Centre, Making progress towards the completion of the Single European Labour Market,  
available at: http://www.epc.eu/documents/uploads/pub_3529_single_european_labour_market.pdf. 

EN 

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5.3.5.6 Impact of Policy Option 2: extension of the period of export of unemployment benefits 
until the end of the entitlement period 

Policy  Option  2:  extension  of  the  period  of  export  of  unemployment  benefits  until  the  end  of  the 
entitlement period. 

Social impacts 

Clarification 

Simplification 

Protection of rights 

Economic impacts 

+ 

+ 

+ 

The  adoption  of  this  option  could  have  positive  effects  in 
comparison to the baseline scenario, as the period of export will be 
subject to a uniform rule with no room for differing interpretation 
or practices. 

A direct link between the export and the entitlement period will be 
aligned  with  national  rights  in  a  way  mobile  workers  may  find 
easier to understand. 

This  option  would  ensure  that  the  persons  concerned  retain  their 
entitlement to  unemployment benefit for the whole period in case 
of  search  for  work  in  another  Member  State.  It  would  also  allow 
them  to  make  full  use  of  the  possibilities  offered  by  the  host 
Member State to find suitable employment. Figure 2.1 in Annex IX 
shows  that  55.5%  jobseekers  exit  unemployment  after  12  months 
and  75%  after  24  months.  The  increases  are  proportionally  not  as 
substantial as between 3 and 6 months. 

Financial impact 

+/- 

The impact is the same as for option 1.  

Impacts on fundamental rights 

+ 

The impact is the same as for option 1. 

Other impacts 

Regulatory Costs 

Risk of fraud and abuse 

Fair  burden  sharing  between 
Member States 

Coherence 
Specific 
Objectives: 

with 

and  wider 

General, 
EU 

Continue  the  modernisation  of  the 
EU  Social  Security  Coordination 

- 

+ 

+/- 

+ 

The impact of this option on the administrative burden is the same 
as for option 1.  

Combined  with 
introduction  of  a  reinforced 
cooperation mechanism, it is expected that this option will entail a 
lower risk of fraud and abuse than the current rules.  

intended 

the 

The effect is the same as for option 1, although potentiallly for an 
even longer period. 

Extension  until  the  end  of  the  entitlement  period  under  option  2 
will  allow  a  person  to  perform  jobseeking  activities  in  another 
Member  State  throughout  the  full  entitlement  period  and  it 
complies  with  the  2013  citizenship  report  (COM(2013)269) 
proposal  to  extend  the  export  of  unemployment  benefits  to  six 

EN 

78 

   EN 

 
 
increases 

months. However, the effects on length of time spent unemployed 
are in the long-term unclear and it is uncertain longer entitlement to 
unemployment  benefits 
likelihood  of 
actually 
reintegration  into  the  labour  market.  It  could  increase  the 
administrative burden for the State of destination, through needing 
to actively monitor the person's employment situation over a longer 
period.  Moreover,  there  will  be  little  incentive  for  the  country  to 
which  the  person  has  gone  to  provide  active  labour  market 
assistance  throughout  the  full  period  of  the  payment  of  the 
unemployment  benefit,  if  that  institution  has  no  power  to  control 
the  payment  of  unemployment  benefits  or  is  not  compensated 
financially  by  the  competent  Member  State.  This  measure  may 
therefore  be  considered  less  effective  in  achieving  the  wider  EU 
objective  of  supporting  fair  mobility  (fair  for  both  jobseekers  and 
tax-payers)  and  increasing  access  to  employment  opportunities 
throughout  the  Union  and  promoting  access  to  labour  market 
activation measures. 

time  ensuring 
fair 

Rules  by  further  facilitating  the 
exercise  of  citizens'  rights  while  at 
legal 
the  same 
clarity, 
equitable 
a 
distribution  of  the  financial  burden 
the 
among 
and 
Member  States 
administrative 
and 
enforceability of the rules. 

institutions  of 
involved 
simplicity 

and 

the 

•  Ensure 

a  uniform 

and 
consistent  application  of  the 
export rules. 

•  Offer 

jobseekers 

the  best 
chance  of  (re)integrating  into 
the labour market 

•  Provide  for  a  systematic  and 
administer 
to 
easy 
control 
cooperation 
mechanism 
to  monitor  the 
fulfilment  of  obligations  by 
the  jobseeker  in  exchanges 
between Member States 

and 

5.3.6  Conclusions 

By setting a minimum period for the export of unemployment benefits that is longer than the current 
three  months,  option  1  is  more  effective  in  providing  opportunities  for  job  searching  activities  in 
another Member State. It will involve communication between Member States for an extended period 
of time and an effective cooperation mechanism to take away the fear of fraud and error in Member 
States. This option may therefore be considered coherent with the wider EU objective of supporting 
fair mobility (fair for both jobseekers and tax-payers in the competent Member State) and increasing 
access to employment opportunities throughout the Union while limiting the time in which a jobseeker 
does not have direct access to activation measures and support from the competent Member State. It is 
also  aligned  with  2013  citizenship  report  (COM(2013)269)  which  as  its  key  action  1  refers  to  the 
proposal to extend the export of unemployment benefits to six months. 

Although  extension  until  the  end  of  the  entitlement  period  under  option  2  will  allow  a  person  to 
perform jobseeking activities in another Member State throughout the full entitlement period, it will 
not  be  effective  if  not  accompanied  by  an  established  control  mechanism  that  will  allow  competent 
Member States to follow up on the jobseeking activities of the person. The effects on length of time 
spent  unemployed  are  in  the  long-term  unclear.  It  could  increase  the  administrative  burden  for  the 
State  to  which  the  person  has  gone,  through  needing  to  actively  monitor  the  person's  employment 
situation.  Moreover,  there  will  be  little  incentive  for  the  country  to  which  the  person  has  gone  to 
provide  active  labour  market  assistance  throughout  the  full  period  of  the  payment  of  the 
unemployment  benefit,  if  that  institution  has  no  power  to  control  the  payment  of  unemployment 
benefits  or  is  not  compensated  financially  by  the  competent  Member  State.  This  measure  may 
therefore be considered less effective in achieving the wider EU objective of supporting fair mobility 
(fair  for  both  jobseekers  and  tax-payers)  and  increasing  access  to  employment  opportunities 
throughout the Union and promoting access to labour market activation measures even if it complies 
with  the  2013  citizenship  report  (COM(2013)269)  proposal  to  extend  the  export  of  unemployment 
benefits to six months. This option is therefore not the most effective, or efficient option. The results 
of the online consultation by Deloitte Consulting show that 79% of the public authorities think that the 
risk of misuse or abuse of rights is particularly high if the unemployment benefits would be provided 
until the end of a persons’entitlement, according to the rule of the Member State which provides them. 

EN 

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5.4. 

The rules on the provision of unemployment benefits for frontier and other cross-border 
workers  

5.4.1  Problems with the coordination rules on the provision of unemployment benefits for 
frontier and other cross-border workers 

Drivers

Problems

Presumption that frontier workers
always have  closer ties with the State 
of residence no longer reflects reality

Frontiers workers are 
disadvantaged compared to 
other cross-border workers

Current rules on administrative 
procedure for reimbursement are 
inadequate and burdensome

Increased administrative 
burden & unbalanced
distribution of financial
burden between MS

5.4.1.1 Frontier workers are disadvantaged compared to other cross-border workers  

The  legislator  has  made  an  explicit  choice  in  Regulation  (EC)  No  883/2004  that  a  frontier  worker 
should receive unemployment benefits in the State of residence. This is a derogation from the general 
principle that a person pursuing a gainful activity should be affiliated to the social security scheme of 
the State in the territory of which he/she is employed or self-employed (lex loci laboris principle). 

However, this derogation is not applied consistently: 

1) It applies only to frontier workers, but not to other cross-border workers. Cross-border workers who 
do  not  return  on  a  regular  basis  to  their  country  of  residence  have  a  right  of  choice,  i.e.  they  can 
remain  in  their  country  of  activity  and  claim  unemployment  benefits  there  or  they  can  claim 
unemployment benefits from the country of residence, provided they return to that country.  

2)  Moreover,  the  derogation  only  applies  to  frontier  workers  who  are  wholly  unemployed,  whereas 
frontier  workers,  who  are  only  partially  or  intermittently  unemployed  continue  to  receive  their 
unemployment benefit from the country of last activity. 

3)  In  addition,  it  does  not  necessarily  apply  to  those  frontier  workers  who  were  formerly  self-
employed.  If  they  reside  in  a  country  where  there  is  no  unemployment  insurance  for  self-employed 
persons, they shall be entitled to receive unemployment benefit from the institution in the country of 
last activity to which they had been affiliated. 

The derogation for unemployed frontier workers is based on the assumption that, as a rule, they have 
closer ties to the Member State of residence then to the Member State of previous employment and 
therefore better prospects of finding a job there Moreoever, unemployed persons have to register with 
the  employment  service  which  is  competent  for  them  in  order  to  receive  their  benefits  and  they  are 
required to available for work. It has been assumed that this condition can more easily be fulfilled in 

EN 

80 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
the  country  of  residence  than  in  the  State  of  previous  employment  and  that,  for  this  reason,  frontier 
workers can get their benefits in the State of residence under more favourable conditions. 229 
However, this assumption appears to be flawed when looking at the latest statistics230. An estimated 
average of 927.000 cross-border workers231 (76% of the total number of cross-border workers) were 
employed  for  longer  than  12  months  in  the  State  of  activity  before  becoming  unemployed  which 
indicates  that  they  have  established  a  strong  link  to  the  labour  market  of  the  State  of  activity. 
Compared  to  that,  only  287.000  cross-border  workers  (or  24%  of  the  total  number  of  cross-border 
workers) had been employed less than 12 months in their State of activity.  

Moreover, distances can nowadays more easily be bridged by modern means of transport and also by 
electronic means of comunication which are more and more frequently used by employment services 
of Member States also for the purpose of registration and supervision of the jobseeking activities of an 
unemployed person.  

Another  problem  derives  from  the  fact  that  it  is  not  always  easy  to  distinguish  between  frontier 
workers  and  other  cross-border  workers.  A  number  of  Member  States  have  pointed  out  in  the 
discussions  within  the  Administrative  Commission232  that  it  has  become  more  and  more  difficult  to 
assess in practice if a person is a frontier worker or another cross-border worker. Large distances can 
be  more  easily  overcome  nowadays,  so  that  it  cannot  be  excluded  that  for  example,  a  person  who 
works in Brussels returns every weekend to London and is therefore a frontier worker. The Member 
States concerned have therefore questioned if it is still justified to make a distinction between frontier 
workers and other cross-border workers on the basis of their commuting patterns. 

It has also to be acknowledged that a consequence of the current different treatment of unemployed 
frontier workers and other cross-border workers may disadvantage the first group in comparison to the 
latter, especially when the legislation of the State of last employment would have resulted in a more 
favourable level of unemployment benefits for the unemployed frontier worker. This became apparent 
in  the  Case  C-443/11  Jeltes233  and  there  are  also  numerous  complaints  (28  from  August-December 
2012 and 35 in the period of January-September 2013) showing that the current rules are not always in 
the interest of the workers’ concerned. Being bound to claim unemployment benefit in their country of 
residence, they are at a significant disadvantage compared to cross-border workers, who have right of 
choice.  As  cross-border  workers  tend  to  work  in  countries  where  comparatively  higher  wages  and 
benefits  are  paid,  there  is  some  evidence  that,  as  a  general  rule,  they  will  be  entitled  to  higher 
unemployment benefits when they are allowed to claim them in their country of last activity. There is 
a  difference  of  68%  between  the  amount  of  the  unemployment  benefits  paid  by  the  State  of  last 
activity and the State of residence.234 

Example: The Austrian authorities in the framework  of the Impact Assessment  Study presented 
the case of a Hungarian frontier worker, who resided in Hungary and worked for a period of 30 
years in Austria, after which he became unemployed. An average monthly salary of € 2000 gives 
entitlement to three months of unemployment benefits in Hungary of around € 340 per month. Had 
the frontier worker applied for unemployment benefits in Austria, he would have been entitled to 
€ 1100 for a period of at least nine months. 

229 For these reasons and in spite of the inherent flaws, the compatibility of this provision with the principle of free movement of persons had 
been confirmed by the Court in the Case C-443/11, Jeltes, EU:C:2013:224, paragraph 51. 
230 Pacolet, J. & De Wispelaere, F., Update of the analytical studies for an impact assessment for revision of Regulations (EC) Nos 883/2004 

and 987/2009: coordination of LTC benefits and unemployment benefits , HIVA - KU Leuven, September 205, See Annex XXVI. 

231 Average figure for the years 2013 and 2014. 
232 Czech Republic, Poland, Finland, Spain, Portugal, Slovenia, Latvia. 
233 Case C-443/11, Jeltes, EU:C:2013:224. 
234 Tables 2.7 and 2.8 in Annex XXVI. 

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5.4.1.2 The reimbursement procedure for unemployment benefits between Member States is 
inadequate and burdensome 

Regulation  (EC)  No  883/2004  introduces  a  reimbursement  mechanism  between  the  State  of  last 
activity and the State of residence to compensate for the fact that the institution in the Member State of 
residence has to provide unemployment benefits to unemployed cross-border workers without having 
collected any contributions or taxes for the period of last activity carried out in another Member State. 
From a financial and administrative point of view, the reimbursement mechanism is not satisfactory. 

The current mechanism only partially covers the additional expenses incurred in the Member State of 
residence. This is due to a number of limitations: 

1) The amount of reimbursement to be paid by the State of last activity is capped at the amount that 
the State of last activity would pay under its national legislation. As a result the actual reimbursement 
by the State of last activity to the State of residence, on average, is 23% lower than the amount of the 
claims  representing  the  amount  of  unemployment  benefit  paid  by  the  State  of  residence235.  For 
Luxembourg and the Netherlands, the discrepancy is 0%; i.e. they pay out the entirety of the benefit 
reimbursement  that  is  claimed  from  them.  At  the  other  end  of  the  scale  are  Romania,  Bulgaria  and 
Poland which reimburse, on the average, only 5% or less of the amount claimed.  

2) Reimbursement is limited in time. The competent Member State is only obliged to reimburse the 
first three months of the unemployment benefit payment. This period is extended to 5 months if the 
person  has  been  insured  in  the  competent  Member  State  for  at  least  12  months  in  the  preceding  24 
months.  Any  unemployment  benefit  payments  beyond  that  period  are  not  reimbursed  creating  a 
disproportionate burden for the Member State of residence. 

3)  The  reimbursement  only  covers  the  ‘gross  amount’  of  the  unemployment  benefit,  i.e.  the  full 
amount of those benefits before any deductions (e.g. taxes or contributions levied on the benefit). It 
does  not  cover  other  benefits  which  may  become  payable  due  to  the  fact  that  the  State  of  residence 
also becomes responsible for other social security benefits (e.g. health care or family benefits). 

Table 2.7 in Annex XXVI gives a complete overview of the division of costs between the competent 
Member State and the State of residence. Based on the average amount of unemployment benefits, the 
yearly  expenditure  by  the  State  of  residence  on  unemployment  benefits  to  cross-border  workers  is 
estimated at € 277 million, of which € 238 million is related to frontier workers and € 39 million to 
other cross-border workers (Annex XXVI, table 2.7236). Of the yearly expenditure on unemployment 
benefits,  67%  is  paid  by  the  State  of  residence  and  33%  is  paid  by  the  State  of  last  activity  on 
average237. However, these figures mask very large discrepancies in the share of the burden shared by 
the Member States of last activity and of residence. For example, in the cases of countries with a very 
low number of incoming cross-border workers, the cost is mainly borne by the State of residence. 

This  demonstrates  quite  clearly  that  the  current  system  is  particularly  disadvantageous  for  States  of 
residence with a high number of 'outgoing' frontier workers or with a higher level of unemployment 
benefits  compared  to  the  States  of  last  activity238.  Member  States  that  are  net  'exporters'  of  frontier 
workers can, in a time of economic downturn, find themselves confronted with a much larger number 
of former frontier workers claiming an unemployment benefit for which the State of residence never 
received social security contributions. 

Another problem is that the reimbursement procedure is administratively burdensome. It requires that 
for each single case, that information is exchanged on the working period of the person concerned, the 

235 Annex XXVI - Table 2.3. 
236 In order to estimate the budgetary impact of the baseline scenario, the estimated number of unemployed cross-border workers  
(based on the LFS and the unemployment rates of the 2015 Ageing Report) is multiplied by the annual unemployment benefit per 
 unemployed person taking into account the annual average duration of the payment of the unemployment benefit. 
237 After reimbursement, these percentages are 55% and 45%. 
238 Table 2.2 in Annex XXVI. 

EN 

82 

   EN 

 
                                                 
reimbursement  period  and  payment  dates239.  The  debtor  Member  State  then  has  to  check  if 
reimbursement  has  not  already  been  applied  for  the  same  periods,  or  if  the  ceiling  under  national 
legislation  has  been  reached.  If  a  request  for  reimbursement  is  refused,  or  only  partially  accepted, 
further  exchange  on  the  reasons  for  refusing  the  requests  is  needed.  Delays  of  reimbursement  are 
mentioned as a common problem by 22% of the respondents on behalf of organisations240 to the EU 
public  consultation.  This  leads  to  uncertainty  in  the  Member  State  of  residence  if  and  when  it  will 
receive the reimbursement requested from the Member State of last activity. 
It  follows  from  the  online  consultation  by  Deloitte  Consulting241  that  the  long  processing  time  of  a 
case  is  seen  as  very  problematic  for  claimants  of  unemployment  benefits,  because  as  long  as  a 
Member  State  does  not  have  the  required  information  about  a  claimant,  it  is  not  able  to  make  a 
decision  about  the  unemployment  benefit.  Communication  between  institutions  of  Member  States  is 
perceived  as  an  area  with  margin  for  improvement.  Problems  of  delays  are  reported  by  public 
authorities in the online survey by Deloitte Consulting and the public consultation. Only 10% of the 
respondents to the Deloitte survey think that the communication with other Member States in dealing 
with  individual  claims  for  unemployment  benefits  is  effective  and  smooth.  About  25%  of  the 
respondents describe the communication as ineffective and slow.  

Member  States  have  therefore  agreed  on  an  administrative  procedure  for  the  reimbursement  of 
unemployment benefits in Decision U4 of the Administrative Commission242. Although this Decision 
constitutes a good step towards a joint interpretation of the reimbursement mechanism, it is not applied 
consistently  across  the  EU.  Member  States  even  have  started  questioning  its  value,  despite  it  being 
applicable as of 2012 only. The Decision states that reimbursement can be claimed ‘regardless of the 
eligibility  conditions  for  unemployment  benefits  laid  down  by  the  legislation  of  the  creditor  State.” 
This is not complied with by a State which makes the reimbursement conditional upon the fulfilment 
of sufficient periods of contributions, because it argues that otherwise, the maximum amount payable 
under its own legislation is zero. In December 2013, the Commission received a letter from the Chair 
of the Administrative Commission raising the collective concern that one particular Member State is 
not applying Decision U4 in a correct way. 

Another  problem  concerns  disputes  about  the  determination  of  the  place  of  residence.  In  these 
situations, it is frequently extremely difficult to verify retroactively where the place of residence of the 
person concerned had actually been during his or her past period of employment.243  

In  the  online  consultation  carried  out  by  Deloitte  consulting,  72%  of  the  respondents  from  public 
authorities indicated that the current rules are not uniformly understood and applied by the Member 
States.  A  recurrent  concern  is  the  reimbursement  procedure  between  Member  States  which  are  not 
sufficiently  detailed  and  clear.  40%  of  the  participating  public  administrations  in  the  online 
consultation by Deloitte consulting reported that the EU rules create significant administrative costs 
for  national  administrations.  The  reimbursement  was  repeatedly  mentioned  as  a  source  of  burden 
mainly due to slow and ineffective communication between Member States.  

239 Institutions at national, regional and local level to that end exchange information via 'Structured Electronic Documents' (SEDs). SEDs U 
20 to U 27 are developed to communicate in cases when reimbursement is requested: U 20 (Reimbursement Request), U 21 (Reimbursement 
Full Acceptance), U 22 (Reimbursement Non Acceptance), U 23 (Partial Acceptance of Request for Reimbursement), U 24 (Reimbursement 
Payment Notification), U 25 (Reimbursement Receipt/Closing Notification), U 26 (Charging Interest (in case of delay)), and U 27 (Reply on 
Charging Interest). A number of Member States (Belgium, Czech Republic, Germany, Austria, Slovakia and Finland) apply reimbursement 
on the basis of fixed amounts. 
240 The group 'organisations' consists of national administrations, social partners and trade unions, civil society and non-governmental  
organisations and a private company. 
241 Annex II. 
242 Administrative Commission for the Coordination of Social Security Systems, Decision No U4 of 13 December 2011concerning the  
reimbursement procedures under Article 65(6) and (7) of Regulation (EC) No 883/2004 and Article 70 of Regulation No 987/2009, OJ C. 5, 
25.2.2012. 
243 This issue had been raised by Poland, the Czech Republic and Malta in the 342nd and 343rd meeting of the Administrative Commission in 
2015. 

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5.4.2  Baseline Scenario 

There are some 1.2 million cross-border workers employed in the EU28 who are potentially affected 
by  the  provisions  on  unemployment  benefits244.  It  can  be  assumed  that  some  793,000  of  them  are 
frontier  workers,  because  they  reside  in  a  neighbouring  country.245  Applying  the  national 
unemployment  rates  on  those  figures,  results  in  an  estimate  of  91,700  unemployed  cross-border 
workers 53,500 of whom are frontier workers.  

The  evolution  of  those  numbers  in  the  future  will  depend  to  a  large  extent  on  the  evolution  of  the 
number of frontier workers and other cross-border workers and the unemployment rates. Cross-border 
work has increased over the last 10 years in absolute figures largely due to the accessions of the new 
Member  States.  However,  in  relative  terms  (%  of  employed  population)  it  remained  at  a  low  level 
(from 0.5% in 2006 to 0.7% in 2014). If we assume that the number of cross-border workers remain 
stable  in  relative  terms  as  a  %  of  the  employed  population  between  2015  and  2020,  then  we  could 
expect some 1.3 million cross-border workers in 2020, but the numbers of unemployed cross-border 
workers may indeed go down as a lower unemployment rate is projected for 2020246. 

Not undertaking action in the field of coordination of unemployment benefits would mean maintaining 
rules which no longer reflect the real interests of the persons concerned and it would mean to maintain 
the current reimbursement procedure with all its inherent flaws.  

5.4.3  Objectives for review of the existing rules on the provision of unemployment benefits 
for frontier and other cross-border workers 

The general policy objective of this initiative is to continue the modernisation of the EU Social 
Security Coordination Rules by further enabling the citizens to exercise their rights while at the same 
time ensuring legal clarity and a fair and equitable distribution of the financial burden among the 
institutions of the Member States involved.  

In relation to the rules on the provision of unemployment benefits for frontier and other cross-border 
workers, this means in particular to remove unjustified differentiations and to strengthen the link 
between the acquisition and the provision of unemployment benefits, i.e. between the payment of 
contributions by the insured person and the payment of benefits for the insured persons.  

In view of this general objective, the specific objective in this field can be defined as follows: 

•  Frontier and other cross-border workers, who reside in another Member State than the State of last 

activity, shall benefit from the same protection of rights in case of unemployment. 

•  Frontier and other cross-border workers, who reside in another Member State than the State of last 
activity, shall benefit from the best available opportunities of reintegration in the labour market. 

•  The  financial  burden  for  paying  unemployment  benefits  shall  be  distributed  between  the 
competent  Member  State  of  last  activity  and  the  Member  State  of  residence  in  a  manner  that 
corresponds to contributions or taxes received in a way which is easy to administer and achieves 
fair results. 

244 2015 Annual Report on Labour Mobility.  
245 This is a gross estimation, because there are no figures available on the number of frontier workers in the sense of the legal definition 
contained in Regulation (EC) No 883/2004.  
246 2015 Annual Report on Labour Mobility, European Commission (2015). 

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5.4.4  What are the various options to achieve the objectives concerning the provision of 
unemployment benefits for frontier and other cross-border workers 

A number of policy options have been identified to meet the objectives set out above.  

5.4.4.1 Option 0: baseline scenario 

Under  the  status  quo,  unemployed  cross-border  workers  who  are  not  frontier  workers  can  choose 
either to remain available to the employment services in the territory of the competent Member State 
or to make themselves available to the employment services in the territory of the Member State where 
he/she  resides.  In  the  first  case,  they  receive  their  unemployment  benefits  from  the  Member  State 
where they were last employed, in the second case from the Member State where they reside. 

Frontier  workers,  i.e.  those  cross-border  workers  who  return  to  their  State  of  residence  on  a  regular 
daily or at least weekly basis do not have this right of choice, as they can claim their unemployment 
benefits only from the employment service at their place of residence. 

A  reimbursement  system  has  been  established  in  order  to  compensate  for  situations  in  which  the 
Member State of residence is obliged to pay unemployment benefits to former cross-border workers 
without having benefited from their contributions or taxes during their previous economic activity. 

5.4.4.2 Option 1: Introduce a right of choice for frontier workers to receive unemployment 
benefits from the Member State of last activity, or the Member State of residence 

This  option  ‘copies’  the  baseline  scenario  by  offering  frontier  workers  the  same  right  of  choice  as 
other  cross-border  workers  currently  enjoy  under  the  status  quo.  This  option  thus  abolishes  the 
distinction between frontier workers and other cross-border workers as regards the State in which they 
can claim the benefits, while offering the best chance of reintegrating into the labour market across the 
EU. 

The  choice  would  imply  making  oneself  available  to  the  employment  services  in  the  Member  State 
where the benefits are claimed. This requires that the competent Member State creates a legal fiction 

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of residence and pays the unemployment benefits as if the person resided on its territory. If the person 
decides to be available for the labour market of the State of former activity and is claiming benefits 
there, this State should pay the unemployment benefits as if he/she resided on its territory. 

The choice for one Member State does not exclude that the unemployed frontier worker may also go 
and  look  for  work  in  the  other  Member  State.  To  increase  the  opportunities  to  find  work  the 
unemployed frontier worker may also register with the employment services in the Member State not 
paying the benefit as a supplementary step which does not affect the obligations that the unemployed 
person  needs  to  fulfil  in  the  State  paying  the  benefits.  Therefore,  the  obligations  and/or  jobseeking 
activities in the Member State which pays the benefit take priority over any obligations in the second 
Member State. 

5.4.4.3 Option 2: Provide for the payment of unemployment benefits by the Member State of 
last activity  

This option aims to ensure that the country which has received the contributions or income tax is the 
one that should pay the benefit. It will also abolish the distinction between frontier and other cross-
border workers. The sub-options differ as regards the country in which the person registers with the 
employment services and is available for the labour market. 

5.4.4.3.1 
employment services in the State of last activity 

Option 2a: The unemployed cross-border worker shall register with the 

Under this option, the unemployed cross-border worker registers with the employment services of the 
State of last activity and will claim benefits there. 

This option assumes that the worker is to a certain degree integrated into the labour market of the State 
of last activity and is orienting towards finding a job in this Member State. If the person rather wishes 
to return to the State of residence to look for work there, he/she can make use of the right to export the 
unemployment benefits from the competent Member State to the Member State of residence. Whilst 
the  unemployed  worker  still  needs  to  comply  with  the  obligations  in  the  State  of  last  activity,  the 
employment  services  in  the  Member  State  of  residence  will  carry  out  verification  procedures  and 
provide assistance with jobseeking activities on behalf of the competent institution. 

5.4.4.3.2 
register with the unemployment services in the State of last activity, or the State of residence 

Option 2b: The unemployed cross-border worker is awarded the choice to 

This  option  is  the  same  as  option  2a  when  it  comes  to  the  payment  of  the  benefit,  but  offers  the 
unemployed cross-border worker the opportunity to either register with the employment services in the 
State of last activity, or in the Member State of residence.  

The aim of this option is to offer cross-border workers whose habitual place of residence is far away 
from their place of last activity the opportunity to fulfil the jobseeking activities in their Member State 
of  residence.  If  the  legislation  of  the  competent  Member  State  requires  participation  in  activation 
measures,  training  and  physical  presence,  a  person  will  satisfy  these  criteria  by  performing  the 
obligations in the State of residence. 

Secondly,  this  option  also  aims  to  facilitate  the check  on  jobseeking  obligations  by  the  employment 
services in the State of residence on behalf of the State of last activity247.  

As  the  Member  State  of  residence  will  be  made  responsible  for  following  up  on  the  jobseeking 
activities  of  the  person  concerned,  but  will  not  reap  the  financial  benefits  from  these  activities, 
incentives will require introduction for the Member State of residence to check this. In this respect, the 
employment services in the State of residence should be given discretionary power to mandate extra 
activity  that meets  the  needs  of  the  regional  labour  market.  Enhanced  mobility  support  services  and 
improved  exchanges  of  information  within  the  EURES  network  could  contribute  to  providing 

247  The  CJEU  has  concluded  in  the  Caves  Krier  case  (Case  C-379/11)  that  a  Member  State  may  not  make  the  registration  of  a  jobseeker 
subject to the condition of residence on its territory. 

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assistance to persons on behalf of the employment services in another Member State. In addition, the 
public  employment  services  (PES)  are  encouraged  to  develop  partnerships  to  promote  a  coherent 
service package to employers as regards intra-EU labour mobility248. 

5.4.4.4Option 3: Provide for the payment of unemployment benefits by the Member State of 
last activity only in situations where the cross-border worker has worked there for a 
sufficiently representative period (at least 12 months) 

When discussing this option in the Administrative Commission, it was noticeable to what extent the 
delegations  were  divided  between  keeping  the  system  as  it  is  now249,  and  moving  to  a  coordination 
system under which the State of last activity is paying the unemployment benefits. The delegations in 
favour of the status quo feared that a change of the coordination system would not provide adequate 
protection for the person and would put a heavy financial burden on the State of last activity in case of 
short  periods  of  employment  there.  Moreover,  this  option  would  require  more  stringent  monitoring 
and control measures from the labour market authorities in the Member State paying the benefits.  

The  divide  between  Member  States  was  the  reason  to  develop  a  third  option  that  could  meet  the 
concerns  raised250.  This  option  only  makes  the  State  of  last  activity  competent  if  the  cross-border 
worker is deemed to have a 'sufficient link' with the labour market of the State of last activity. This 
'sufficient link' is reflected in the duration of insurance for unemployment benefits in the State of last 
activity.  The  rationale  for  this  option  is  that  Member  States  will  not  be  confronted  with  claims  for 
unemployment benefits after only a very short period  of insurance in that Member State.  Moreover, 
the  option  aims  at  a  better  correlation  between  the  level  of  the  benefit  and  the  earning  level  of  the 
person concerned.  

The  link  with  the  labour  market  of  the  State  of  last  activity  arises  from  the  insurance  under  an 
unemployment scheme of that State for at least the last 12 months before becoming unemployed. This 
length of the period is based on the average length of the reference periods in Member States251, the 
distribution of the average duration of current unemployment spells among cross-border workers, plus 
the fact that nearly all conflict rules in Regulation (EC) No 883/2004 refer to the period of 12 months 
as  a  reference  period  for  establishing  either  a  connection  to  the  social  security  system  of  a  Member 
State252, or for acquiring rights253. 

It  is  also  based  on  the  assumption  that having been insured  in  another  Member  State  for  at  least  12 
months254  creates  a  close  link  with  the  labour  market  of  the  State  of  last  activity,  which  gives  the 
unemployed  cross-border  worker  a  good  chance  of  finding  suitable  employment  in  that  State.  If  the 
person  wishes  to  register  with  the  employment  services  in  the  State  of  residence,  he/she  can  opt  to 
export the unemployment benefits from the State of last activity.  

In the situation where a person has not fulfilled the reference period in the State of last activity, the 
Member State of residence is competent for paying the unemployment benefits,255 therefore rendering 
the  current  reimbursement  mechanism  redundant.  Also  under  this  option,  two  sub-options  can  be 

248. The Commission Staff Working Document on Reforming EURES to meet the goals of Europe 2020  
(SWD(2012) 100 final) sets out the goals and lines along which the EURES reform will take place. 
249 Germany, Ireland, Denmark, the Netherlands, Austria, Greece, Slovakia. 
250 This option is a compromise solution and no explicit consultation has taken place. 
251 Source: www.missoc.org. The reference period should be sufficiently long enough to avoid parallel entitlements in two Member States at  
the same time. 
252 Title II of Regulation (EC) No 883/2004. 
253 For example pension rights: only periods of insurance or residence of at least a year will be taken into account for calculating pension  
rights. 
254 How the 'insurance' is established, is a matter of national law. Regulation (EC) No 883/2004 defines as a period of insurance "periods of 
contribution, employment or self-employment as defined or recognized as periods of insurance by the legislation under which they were 
completed  or  considered  as  completed,  and  all  periods  treated  as  such,  where  they  are  regarded  by  the  said  legislation  as  equivalent  to 
periods  of  insurance"  (Article  1  (t))  .  It  must  be  stressed  that  Regulation  (EC)  No  883/2004  cannot  take  away  rights  that  have  been 
acquired independently on the basis of national legislation. If the national reference period in the State of last activity is shorter than 12 
months, the person can choose if he would like to receive the unemployment benefits from that Member State. 

255 If the Member State of residence has no unemployment benefit system for self-employed frontier workers, the Member State  
of last Portugal, without taking account of the potentially higher earnings in the Netherlands activity will have to export the unemployment  
benefits as is currently the case. 

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explored that differ as regards the possibilities to register with the employment services in  the State 
(not) paying the benefits: 

5.4.4.4.1 
in the State of last activity 

Option 3a: The unemployed person shall register with the employment services 

In  the  situation  where  the  State  of  last  activity  is  competent  to  pay  the  unemployment  benefits,  the 
unemployed cross-border worker is required to register with the employment services in the State of 
last activity. 

5.4.4.4.2 
unemployment services in the State of last activity, or the State of residence 

Option 3b: The unemployed person is awarded the choice to register with the 

Under this option, the competent Member State will remain responsible for paying the unemployment 
benefits, whereas the unemployed cross-border worker can register with the employment services in 
the State of residence. The employment services of the State of residence will follow up on performing 
the checks on the jobseeking activities on behalf of the competent Member State. Enhanced mobility 
support  services  and  improved  exchanges  of  information  for  the  EURES  network  could  be  used  to 
provide assistance to persons on behalf of the employment services in another Member State. 

5.4.5  Stakeholder support for the different options concerning the provision of 
unemployment benefits for frontier and other cross-border workers 

5.4.5.1 Option 1: Introduce a right of choice for frontier workers to receive unemployment 
benefits from the Member State of last activity, or the Member State of residence 

Only one delegation of the Administrative Commission seemed to support this option. Concerns were 
expressed that rather than the employment opportunities, the level of the benefits could be a decisive 
factor for making the choice. The option was supported by almost half of the individual respondents to 
the public consultation and 29% of the respondents who are representatives of the social partners.256 

5.4.5.2 Option 2: Provide for the payment of unemployment benefits by the Member State of 
last activity either with registration with the employment services in the State of last activity 
(2a) or giving the worker a choice of registering with the employment services in the State of 
last activity or the State of residence (2b) 

When presenting this option to the Administrative Commission, it was favoured by nine delegations 
for reasons of simplification257. Looking at the results of the public consultation, 40% of the individual 
respondents and 47% of the social partners supported this option. 

5.4.5.3 Option 3: Provide for the payment of unemployment benefits by the Member State of 
last activity only in situations where the cross-border worker has worked there for a 
sufficiently representative period either with registration with the employment services in the 
State of last activity (3a) or giving the worker a choice of registering with the employment 
services in the State of last activity or the State of residence (3b) 

These  options  were  developed  in  direct  response  to  feedback  from  Member  States  in  the 
Administrative Commission to address  concerns about the potential financial burden on the State of 

256 A public consultation between December 2012 and February 2013 invited citizens and organisations to provide their views on  
the main problems linked to the coordination of unemployment benefits for cross-border workers. 
257 Czech Republic, Spain, Portugal, Poland, Italy, Romania, Slovenia, France and Malta. 

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last  activity  in  case  of  short  periods  of  employment  there  and  the  need  for  robust  monitoring  and 
control measures from the labour market authorities in the Member State paying the benefits. Option 3 
(and  its  sub-options)  was  developed  as  a  compromise  in  response  to  this  feedback  but  no  formal 
consultation on this option has taken place. 

Impact assessment of the different options concerning the provision of unemployment 

5.4.6 
benefits for frontier and other cross-border workers frontier workers 

These options are assessed for the specific group of frontier workers and cross-border workers. It has 
not been possible to give quantitative estimations for the possible secondary effects on their mobility. 

As  the  number  of  outgoing  and  incoming  cross-border  workers  differs  between  Member  States,  an 
assessment  of  the  economic  impact  has  to  combine  both  situations.  Moreover,  the  reimbursement 
mechanism  has  to  be  taken  into  account.  Calculations  are  based  on  the  assumption  that  frontier 
workers  claim  benefits  in  their  country  of  residence  and  other  cross-border  workers  will  choose  the 
highest  amount  and  based  on  the  assumption  that  they  will  receive  the  country-specific  average 
amount for an average duration of unemployment.258 

Based on Labour force Survey (LFS) data for 2013 and 2014, an estimation of the number of cross-
border  workers  has  been  made.  In  the  further  analysis  we  considered  all  workers  who  worked  in 
another  country  than  the  country  of  residence  as  cross-border  workers.  Workers  who  worked  in  a 
neighbouring  country  are  considered  as  frontier  workers.  This  is  different  from  the  legal  definition 
provided in Regulation (EC) No 883/2004. National unemployment rates from Eurostat were applied 
to  the  number  of  cross-border  workers  in  order  to  estimate  the  number  of  unemployed  cross-border 
workers. The unemployment rates of the country of last activity and not of the country of residence 
have been applied on the number of cross-border workers. In order to estimate the budgetary impact of 
the baseline scenario, the estimated number of unemployed cross-border workers are multiplied by the 
annual unemployment benefit per unemployed by taking into account the annual average duration of 
the payment of the unemployment benefit (on the basis of ESSPROS, Eurostat figures and the LFS).  

There are no reliable figures on the administrative cost for handling claims for unemployment benefits 
for  cross-border  workers.  A  stylised  and  cautious  estimate  on  the  regulatory  costs  on  the  basis  of  a 
limited number of Member States comes to the conclusion259, that in all cases, in which the State of 
residence pays the unemployment benefit, this results in an additional administrative cost of around € 
43 for the handling of a PD U1 in the State of residence and some € 20 in the State of last activity. For 
the processing of a reimbursement claim, the regulatory costs are estimated at € 20 in both countries. 
Multiplying this estimated standard cost with the total number of cases results in a total administrative 
cost for the payment of the unemployment benefit has been used to estimate the regulatory costs. 

258 Source: Table 2.4 in Annex XXVI.  
259 See Table 2.9 of Annex XXVI. 

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5.4.6.1 Summary of the impact of different options concerning the provision of unemployment benefits for frontier and other cross-border workers 

Type 
impact 

of 

Clarification  Simplification  Protection 

of rights 

Fundamental 
rights 

Economic 
impacts 

Regulatory 
costs 

Risk 
fraud 
abuse 

of 
and 

Equitable 
burden 
sharing 
Member 
State 

Coherence 
with  General, 
Specific  and 
EU objectives 

Overall 
Effectiveness 

Overall 
Efficiency 

(cost 
effectiveness 

vs 

Baseline 
Scenario 

Option 1  

Option 2a  

Option 2b  

Option 3a 

Option 3b 

0 

- 

+ 

+ 

+ 

+ 

0 

- 

+ 

+/- 

+ 

+/- 

0 

++ 

+ 

+ 

+ 

+ 

0 

+ 

+ 

+ 

+ 

+ 

0260 

-262 

-264 

-266 

-268 

-270 

0261 

+263 

+265 

-267 

+269 

-271 

0 

- 

+/- 

+/- 

+ 

+ 

0 

- 

+/- 

+/- 

+ 

+ 

0 

+ 

++ 

+ 

++ 

+ 

0 

+ 

+ 

+ 

++ 

++ 

0 

- 

+ 

- 

++ 

+ 

260 € 416 m is budget devoted to the payment of unemployment benefits to frontier and other cross-border workers This figure also takes the effect of the reimbursement mechanism into account Table  
2.4 in Annex XXVI. 
261 € 9.9 m is the cost of handling unemployment benefits for frontier and other cross-border workers. 
262 Budget devoted to the payment of unemployment benefits increases to € 556 m.  
263 The regulatory costs decrease to € 4.9 m See Table 2.9 of Annex XXVI. 
264 Budget devoted to the payment of unemployment benefits increases to € 499 m.  
265 The regulatory costs decrease to € 3.7 m. 
266 Budget devoted to the payment of unemployment benefits increases to € 499 m.   
267 Regulatory costs will increase due to additional cooperation and control mechanisms. 
268 Budget devoted to the payment of unemployment benefits increases to € 442 m. 
269 The regulatory costs decrease to €5.1 m. 
270 Budget devoted to the payment of unemployment benefits increases to € 442 m.  
271 Regulatory costs will increase due to additional cooperation and control mechanisms. 

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5.4.6.2 Impacts of Policy Option 1: Introduce a rights of choice for frontier workers to reeive 
unemployment benefits either in the State of last activity or State of residence. 

Policy Option 1: Introduce a right of choice for frontier workers to receive unemployment benefits either 
in the State of last activity or the State of residence 

Social impacts  

Clarification 

Simplification 

Protection of rights 

Financial impact 

- 

- 

++ 

- 

For the workers and public institutions, this option will cause a 
significant increase in uncertainty as the choice is only made at 
the moment when a person falls unemployed.  

In  comparison  to  the  baseline,  this  option  does  not  lead  to  a 
simplification,  as  the  right  of  choice  is  only  made  at  the 
moment when the person claims unemployment benefit. It also 
requires effective follow-up of the jobseeking activities of the 
unemployed person  who  does  not  reside  in  the  Member  State 
paying the benefit. 

This option contributes to optimise a frontier worker's chances 
of resuming employment under the most favourable conditions 
by providing the worker with the maximum amount of freedom 
to decide where they have the best chances of finding work 

This  option  will  lead  to  an  overall  increase  of  the  annual 
unemployment benefit expenditure for cross-border workers of 
34% (€ 556 million instead of € 416 million under the baseline 
scenario272)  due  to  the  fact  that  the  persons  concerned  are 
likely  to  choose  the  scheme  providing  the  highest  benefit 
(Annex  IX  –  Table  2.10  and  Annex  XXVI  –  Table  2.4).  The 
estimated  effect  differs  for  the  individual  Member  States 
depending  on  the  average  amount  of  benefits  paid  by  the 
Member  States  concerned.  For  8  Member  States273  this  is  the 
most  expensive  option  and  the  least  expensive  option  for  9 
Member States274.  

Impacts on fundamental rights 

+ 

Other impacts 

Regulatory Costs 

+ 

This option contributes to the freedom to choose an occupation 
and  the  right  to  engage  in  work  in  another  Member  State 
(Article  15),  as  well  as  to  a  better  protection  of  rights  for 
workers  who  have  made  use  of  their  right  to  free  movement 
(Article  45).  There  is  no  incidence  on  the  right  to  property 
(Article  17)  as  acquired  rights  to  unemployment  benefits  are 
maintained. 

This  option  will  reduce  the  number  of  reimbursement  cases 
between  Member  States,  as  they  will  be  distributed  between 
the  State  of  last  activity  and  the  State  of  residence.  The 
unemployed person makes his/her choice explicit by applying 
the 
for  unemployment  benefits, 

thereby  providing  all 

272 Calculations are based on the average amount of unemployment benefits paid in 2013/2014 and an assumed average duration of payment 
of 3 months.  
273 Czech Republic, Denmark, Germany, Ireland, Spain, Luxembourg. Netherlands and Finland, see Table 2.6 in Annex . 
274 Bulgaria, Estonia, Latvia, Hungary, Poland, Portugal, Slovak Republic, Sweden and the United Kingdom. 

EN 

91 

   EN 

 
 
 
                                                 
information  required  under  the  national  legislation.  If  the 
unemployed  person  wishes  to  receive  the  unemployment 
benefit from the State of residence, they can request a PD U1 
from  the  State  of  last  activity  and  submit  it  to  the  institution 
where  they  claim  unemployment  benefit.  If  the  unemployed 
person opts to receive unemployment benefits from the State of 
last  activity,  this  will  result  in  a  ‘permanent  export’  of  the 
unemployment benefits by that State, necessitating information 
exchange between the institution in the State of residence and 
in  the  competent  Member  State  on  the  follow-up  of  the 
jobseeking  activities  of 
the  person  concerned.  The 
administrative  cost  for  the  State  of  residence  is  estimated  at 
€ 4.9 million (Annex XV - Table 15 and Annex XXVI – Table 
2.9).  This  is  a decrease of 50%  in  comparison  to  the baseline 
scenario (of € 9.9 million euro). The costs for issuing PD U1s 
by the State of last activity drops from € 51.400 to € 18.500; a 
decrease  in  the  administrative  burden  of  64%  (Annex  XV  -
Table 14275). 

This  option  itself  does  not  lead  to  an  increased  risk  of  fraud 
and  abuse,  as  the  person  concerned  is  subject  to  the  same 
obligations  as  any  other  unemployed  person  in  the  Member 
State of which he or she chooses to receive the unemployment 
benefits. The risk of 'opportunistic behaviour' rather relates to 
the  choice  from  which  country  to  receive  unemployment 
benefits.  As  was  indicated  by  many  public  authorities  in  the 
stakeholder  consultation,  the  labour  market  chances  may 
frequently  not  outweigh  the  choice  for  the  most  generous 
unemployment benefits. 

This option is likely to put a additional burden in particular on 
the  Member  States  with  comparatively  high  unemployment 
benefits  and  will  therefore  not  lead  to  a  more  equitable 
distribution of the financial burden for Member States.  

The  unemployed  frontier  worker  is  offered  the  greatest 
flexibility to re-integrate into the labour market of their choice. 
It  will  eventually  reduce 
the  administrative  burden  of 
processing reimbursement and will shift a part of the financial 
burden from the State of residence to the State of last activity. 
However, this is fully dependent on the choice that the person 
makes and this option entails great uncertainty for the Member 
States. This option also entails an overall increase in budgetary 
costs.  It  could  also  encourage  the  unemployed  person  to 
choose  the  State  with  the  most  generous  unemployment 
benefits,  rather  than  the  one  with  the  best  prospects  for  re-
integration.  However,  this  may  still  be  considered  coherent 
with the wider EU policy objective to promote greater support 
and  labour  activation  measures  to  promote  reintegration  into 
the labour market.  

Risk of fraud and abuse 

- 

Fair  burden 
Member States 

sharing  between 

- 

Coherence  with  General,  Specific 
and wider EU Objectives: 

+ 

Continue  the  modernisation  of  the  EU 
Social  Security  Coordination  Rules by 
the  exercise  of 
further  facilitating 
citizens'  rights  while  at  the  same  time 
ensuring 
legal  clarity,  a  fair  and 
equitable  distribution  of  the  financial 
burden  among  the  institutions  of  the 
and 
Member 
and 
administrative 
enforceability of the rules. 

simplicity 

involved 

States 

• 

• 

Frontier  and  other  cross-border 
workers,  who  reside  in  another 
Member  State  than  the  State  of 
last  activity,  shall  benefit  from 
the same protection of rights in 
case of unemployment. 

Frontier  and  other  cross-border 
workers,  who  reside  in  another 
Member  State  than  the  State  of 
last  activity,  shall  benefit  from 
the 
available 
opportunities  of  reintegration 

best 

275 This calculation is based on stylized estimates. 

EN 

92 

   EN 

 
                                                 
in the labour market. 

•  The 

for 
financial  burden 
paying  unemployment  benefits 
shall  be  distributed  between 
the  competent  Member  State  of 
last  activity  and  the  Member 
State  of  residence  in  a  manner 
that 
to 
corresponds 
contributions  or  taxes  received 
in  a  way  which  is  easy  to 
administer  and  achieves  fair 
results. 

5.4.6.3 Impacts of Policy Option 2a: Member State of last activity provides the unemployment 
benefits to frontier workers and other cross-border workers – registration for employment 
services in Member State of last activity 

Policy  Option  2a:  Introduce  the  rule  in  Regulation  (EC)  No  883/2004  according  to  which  the  Member 
State  of  last  activity  provides  the  unemployment  benefits  to  frontier  workers  and  other  cross-border 
workers – requirement to register with the employment services in the Member State of last activity 

Social impacts 

Clarification 

Simplification 

+ 

+ 

Protection of rights 

+ 

This  option  will  bring  more  clarity  for  the  unemployed  cross-
border  workers  and  the  institutions,  as  it  will  always  be  the 
institution in the Member State of last activity that pays out the 
benefit.  The  person  will  receive  all  benefits  from  the  same 
source, which will provide welcome clarification in relation to 
cases  where  a  person  receives  another  benefit  from  the  of  last 
State (i.e. a partial invalidity benefit). 

One system will apply to all unemployed persons and there will 
no  longer  be  a  distinction  between  frontier  and  other  cross-
border  workers.  A  direct  link  will  be  established  between 
benefits  and  contributions  and  there  is  no  need  for  a 
reimbursement mechanism. Persons residing at a large distance 
from  the  Member  State  of  last  activity  may  face  more 
difficulties  in  meeting  the  eligibility  conditions,  as  they  will 
have to travel a longer way for this purpose to their competent 
employment service, but these could be mitigated by an option 
to  claim  an  export  of  their  unemployment  benefits  to  their 
Member State of residence. This means that persons who prefer 
to  orientate  to  the  labour  market  of  the  State  of  residence  can 
return  to  that  State  by  using  the  right  to  export  their 
unemployment  benefits.  This  means  that  the  unemployed 
person  can  be  more  responsive  to  the  relative  likelihood  of 
finding a job in the different Member States, and can direct his 
or  her  efforts  to  the  Member  State  with  the  best  job 
opportunities in their particular field.  

This  option  ensures  that  cross-border  workers  are  not  treated 
differently from other workers in the same situation, who work 
and  reside  in  the  same  Member  State.  It  also  ensures  that 
unemployment benefits are paid under the conditions and at the 
amount acquired by the payment of contributions. 

EN 

93 

   EN 

 
 
Financial impact 

- 

Impacts on fundamental rights 

+ 

Other impacts 

Regulatory Costs 

+ 

Risk of fraud and abuse 

+/- 

Fair  burden 
Member States 

sharing  between 

+/- 

to  work 

The  total  expenditure  on  unemployment  benefits  will  increase 
from  €  415  million  to  €  499  million;  an  increase  of  20%  in 
comparison to the current scenario. This is due to the fact that 
cross-border  workers  use 
in  countries  with 
comparatively  heigher  wages  and  correspondingly  higher 
benefits (see (Annex XV - Table 2.2 and Annex XXVI – Table 
2.4).  The  estimated  effect  differs  for  the  individual  Member 
States  depending  on  the  average  amount  of  benefits  paid  and 
depending  on  the  relation  of  frontier  works  to  other  cross-
border  workers  residing  in  the  Member  State  concerned.276 
From  a  Member  States'  perspective,  very  short  period  of 
employment  can  have  a  negative  financial  impact,  when  no 
contributions were received in proportion to the cost for paying 
the unemployment benefit. 

This option eliminates differences in treatment between frontier 
workers  and  other  cross-border  workers  and  contributes  to  the 
freedom  to  choose  an  occupation  and  the  right  to  engage  in 
work in another Member State (Article 15) as well as to a better 
protection  of  rights  for  workers  who  have  made  use  of  their 
right  to  free  movement  (Article  45).  The  right  of  property 
(Article  17)  is  protected,  as  the  person  directly  receives  the 
benefits 
lastly  paid 
contributions. 

to  which  he/she 

the  State 

from 

Only  one  Member  State  will  be  competent  for  paying 
unemployment  benefits  and  monitoring  the  availability  of  the 
person to the labour market. The unemployed person can apply 
directly to the institution in the Member State in which he/she 
was insured during the last employed activity. Reimbursement 
arrangements are no longer necessary. Member States will have 
to waive residence conditions for persons registering with their 
employment  services  and  may  have  to  make  changes  to  their 
administrative  procedures  to  check  upon  persons  residing 
outside their territory. It is also the cheapest option, as the total 
regulatory costs are reduced from around € 9.9 million to € 3.7 
million,  i.e.  to  37%  of  the  costs  under  the  baseline  scenario 
(Annex XXVI – Table 2.9).  

This option itself does not lead to an increased risk of fraud and 
abuse,  as  all  unemployed  persons  are  subject  to  the  same 
obligations  as  any  other  unemployed  person  in  the  Member 
State  of  last  activity.However,  in  the  case  of  export  of 
unemployment  benefits  there  may  be  a  perceived  risk  that 
jobseeking obligations are not fully complied with (see section 
5.3.1). 

This  option  will  lead  to  a  more  equitable  distribution  of  the 
costs related to the payment of benefits for Member States who 
have a relatively large number of unemployed frontier workers 
residing in that Member State. It will also remove the obligation 
to  reimburse  the  Member  State  of  residence.  However,  it  may 
also lead to the situation that benefits have to be provided by a 

276 It is the most expensive option for Greece, Cyprus, Malta, Austria and the United Kingdom 

EN 

94 

   EN 

 
 
                                                 
Member State after a relatively short period of insurance. 

the  direct 

This  option  restores 
link  between  receiving 
unemployment  benefits  and  availability  for  the  labour  market. 
The  financial  and  administrative  burden  shifts  to  the  State  of 
last  activity,  leading  to  an  absolute  increase  in  terms  of 
financial  and  administrative  burden  in  States  that  have  a  high 
number  of 
incoming  cross-border  and  frontier  workers, 
although  overall  in  fewer  Member  States  this  option  has  the 
lowest  budgetary  impact.  Moreover,  this  option  does  not 
prevent the Member State of last activity becoming competent 
even after a very short period of activity there, which would in 
reality  not  contribute  to  an  even  burden  sharing.  This  option 
provides for some flexibility for the person concerned, who can 
continue  looking  for  work  in  the  State  of  last  activity  or,  by 
making use of the export of benefits, can return to the Member 
State  of  residence  to  look  for  employment  there.  However, 
where  the  person  is  residing  far  away  from  the  place  where 
he/she  is  registered  with  the  employment  services,  he/she  can 
experience  difficulties  in  following  up  on  the  jobseeking 
activities.  This  therefore  may  not  be  considered  entirely 
coherent with the wider EU policy objective to promote greater 
support and labour activation measures to promote reintegration 
into the labour market.  

Coherence  with  General,  Specific 
and wider EU Objectives: 

++ 

Continue  the  modernisation  of  the  EU 
Social Security Coordination Rules by 
further  facilitating 
the  exercise  of 
citizens'  rights  while  at  the  same  time 
ensuring 
legal  clarity,  a  fair  and 
equitable  distribution  of  the  financial 
burden  among  the  institutions  of  the 
and 
Member 
administrative 
and 
enforceability of the rules. 

simplicity 

involved 

States 

• 

• 

Frontier  and  other  cross-border 
workers,  who  reside  in  another 
Member  State  than  the  State  of 
last  activity,  shall  benefit  from 
the same protection of rights in 
case of unemployment. 

Frontier  and  other  cross-border 
workers,  who  reside  in  another 
Member  State  than  the  State  of 
last  activity,  shall  benefit  from 
the 
available 
opportunities  of  reintegration 
in the labour market. 

best 

•  The 

for 
financial  burden 
paying  unemployment  benefits 
shall  be  distributed  between 
the  competent  Member  State  of 
last  activity  and  the  Member 
State  of  residence  in  a  manner 
that 
to 
corresponds 
contributions  or  taxes  received 
in  a  way  which  is  easy  to 
administer  and  achieves  fair 
results. 

5.4.6.4 Impacts of Policy Option 2b: Member State of last activity provides the unemployment 
benefits to frontier workers and other cross-border workers – choice of registration for 
employment services in either Member State of last activity or State of residence 

Policy  Option  2b:  Introduce  the  rule  in  Regulation  (EC)  No  883/2004  according  to  which  the  Member 
State of last activity provides the unemployment benefits to frontier workers – choice to register with the 
employment services in the Member State of last activity, or the Member State of residence 

Social impacts 

Clarification 

+ 

This option will bring more clarity for the unemployed person 
and  the  institution,  as  it  will  always  be  the  institution  in  the 
Member  State  of  last  activity  that  pays  out  the  benefit  for  all 
unemployed  persons.  On  the  other  hand,  it  contributes  to 
optimise  a  frontier  worker's  chances  of  resuming  employment 
under  the  most  favourable  conditions,  either  in  the  Member 
State of last activity, or in the State of residence 

Simplification 

+/- 

One system will apply to all unemployed persons and there will 
no  longer  be  a  distinction  between  frontier  and  other  cross-
border  workers.  A  direct  link  will  be  established  between 
benefits  and  contributions  and  there  is  no  need  for  a 
reimbursement mechanism. However, the split of competences 

EN 

95 

   EN 

 
 
Protection of rights 

+ 

Financial impact 

- 

between  the  payment  of  the  benefits  and  the  responsibility  to 
follow-up on the jobseeking activities of the person concerned 
calls  for  new  arrangements  between  the  competent  Member 
State and the State of residence. 

This  option  ensures  that  all  cross-border  workers  are  treated 
equally.  They  would  also  get  the  same  benfits  under  the  same 
conditions  as  workers  who  work  and  reside  in  the  Member 
State in which they pursued their activity.  

From  the  point  of  view  of  the  Member  States  this  is  also 
positive;  as  it  is  in  their  interest  to  allow  their  unemployed 
persons  to  look  for  work  in  the  Member  State  where  they  are 
most  likely  to  find  it.  Therefore,  the  impact  in  comparison  to 
the baseline scenario is considered as being positive.  

The economic impact is the same as for option 2a. The costs for 
the  introduction of  the  cooperation  mechanism  will  depend on 
the  specifics  of  the  mechanism  and  could  therefore  not  be 
quantified. 

Impacts on fundamental rights 

+ 

The impact on fundamental rights is the same as for option 2a. 

Other impacts  

Regulatory Costs 

- 

Risk of fraud and abuse 

+/- 

responsibility 

The  impact  on  regulatory  costs  is  the  same  as  for  option  2a. 
However, additional cooperation and control mechanisms need 
to  be  established,  as 
for  paying 
the 
unemployment benefits and checking availability for work can 
lie  with  different  institutions.  The  cooperation  mechanism 
should not only include regular reporting on the situation of the 
unemployed  person,  but  also  provide  for  incentives  for  the 
employment  services  in  the  State  of  residence  to  actively 
follow-up  on  the  jobseeking  activities,  and  possible  financial 
compensation  for  providing  active  labour  market  measures  on 
behalf  of  another  Member  State.  This  could  have  a  negative 
impact  on  the  administrative  burden  in  comparison  to  the 
baseline  scenario,  depending,  in  each  case,  on  the  actual 
measures taken. 

This option itself does not lead to an increased risk of fraud and 
abuse,  as  all  unemployed  persons  are  subject  to  the  same 
obligations  as  any  other  unemployed  person  in  the  Member 
State  of  last  activity.  There  may  be  a  need  to  incentivise  the 
employment  services  in  the  State  of  residence  to  actively 
follow-up on the jobseeking activities. 

Fair  burden 
Member States 

sharing  between 

+/- 

From the perspective of providing the unemployment benefits, 
link  between  receiving 
this  option  establishes  a  direct 
contributions and providing unemployment benefits. It will also 

EN 

96 

   EN 

 
 
 
remove  the  obligation  to  reimburse  the  Member  State  of 
residence. Active labour market assistance measures will, in the 
first place, be at the expense of the employment services in the 
State  of  residence.  However,  it  may  also  lead  to  the  situation 
that  benefits  have  to  be  provided  by  a  Member  State  after  a 
realtively short period of insurance. 

This  option  offers  the  person  concerned  the  opportunity  to 
register  with  employment  services  in  the  State  of  residence. 
This option provides the unemployed persons a right of choice 
as regards their registration which may be convenient for them 
in particular in those situations where their place of residence is 
far away from the place where the competent institution in the 
Member  State of  last  activity  is  located.  They  may  also  prefer 
to deal with their local institution for linguistic reasons. There is 
however also a drawback to this option as the current rules only 
provide for an export of cash benefits, but not necessarily also 
for  the  provision  of  training  and  reactivation  measures  in  a 
country different from the one where the competent institution 
is located. This therefore may not be considered coherent with 
the  wider  EU  policy  objective  to  promote  greater  support  and 
labour  activation  measures  to  promote  reintegration  into  the 
labour  market.  The  institution  in  the  State  of  residence  may 
want to be compensated for these type of activities provided to 
the person concerned.  

Coherence  with  General,  Specific 
and wider EU Objectives: 

+ 

Continue the  modernisation of the EU 
Social Security Coordination Rules by 
further  facilitating 
the  exercise  of 
citizens'  rights  while  at  the  same  time 
ensuring 
legal  clarity,  a  fair  and 
equitable  distribution  of  the  financial 
burden  among  the  institutions  of  the 
and 
Member 
administrative 
and 
enforceability of the rules. 

simplicity 

involved 

States 

• 

• 

Frontier  and  other  cross-border 
workers,  who  reside  in  another 
Member  State  than  the  State  of 
last  activity,  shall  benefit  from 
the same protection of rights in 
case of unemployment. 

Frontier  and  other  cross-border 
workers,  who  reside  in  another 
Member  State  than  the  State  of 
last  activity,  shall  benefit  from 
the 
available 
opportunities  of  reintegration 
in the labour market. 

best 

between 

distributed 

financial  burden 

•  The 
for 
paying  unemployment  benefits  shall 
the 
be 
competent  Member  State  of 
last 
activity  and  the  Member  State  of 
residence 
that 
corresponds  to  contributions  or  taxes 
received  in  a  way  which  is  easy  to 
fair 
administer 
results. 

a  manner 

achieves 

and 

in 

5.4.6.5 Impacts of Policy Option 3a: Member State of last activity provides the unemployment 
benefits to frontier workers and other cross-border workers only if person has worked there 
for 12 months– registration for employment services in Member State of last activity 

Policy Option 3a: Introduce a rule in Regulation (EC) No 883/2004 that the State of last activity only pays 
unemployment benefit if the person has worked there for a sufficiently representative period , i.e. for 12 
months – registration with the State of last activity 

Social impacts  

Clarification 

+ 

This option establishes a direct causal link between the level of 
integration  in  the  labour  market  of  a  Member  State  and 
compensation  for  lost  employment  periods.  The  link  with  the 
labour market arises from the length of the contributions paid in 
the  State  of  activity  and  will  provide  a  balanced  reflection  of 
the  relationship  between  the  contribution  period  and  acquiring 
the right to unemployment benefits. 

EN 

97 

   EN 

 
 
Simplification 

Protection of rights 

Financial impact 

+ 

+ 

- 

Impacts on fundamental rights 

+ 

There  will  be  a  'switch'  between  the  competent  Member  State 
and  the  State  of  residence  dependent  on  the  employment 
duration  of  the  former  cross-border  workers.  The  impact  for 
persons  residing  at  a  large  distance  from  the  Member  State  of 
last activity will be the same as 2a. 

The  unemployed  person  will  always  receive  unemployment 
benefits  from  the  State  with  which  he/she  has  the  closest  link 
with the labour market, either from the State of last activity or 
the State of residence.  

This option will lead to an increase of 6% in budgetary costs for 
Member States from € 416 million to € 442 million (Annex IX 
– Table 2.10 and Annex XXVI – Table 2.4277). For 6 Member 
States  ,  this  option  has  the  lowest  budgetary  impact,  whereas 
for  5  Member  States,  it  is  the  most  costly  option  (Annex  X– 
Table 2.6 and and Annex XXVI – Table 2.4). Many 'outgoing' 
(seasonal)  workers  have  their  place  of  residence  in  these 
countries.  They  are  mostly  employed  less  than  12  months, 
which  means  that  they  will  have  to  claim  unemployment 
benefits in their State of residence. 

When looking at the distribution of unemployment benefits for 
incoming  cross-border  workers,  under  this  option  12%  of  the 
total  unemployment  benefit  will  be  paid  by  the  State  of 
residence and 88% by the State of last activity (Annex XXVI – 
Table 2.7). The Member State of last activity thus has a higher 
share in the payment of unemployment benefits than under the 
current scenario (68%), but it is guaranteed that it has received 
contributions corresponding to at least 12 months of insurance. 
Based  on  2.2c  of  Annex  XXVI,  53.800  unemployed  frontier 
workers  would  receive  unemployment  benefits  in  the  State  of 
last  activity  on  the  basis  of  their  insurance  for  at  least  12 
months  there.  In  the  baseline  scenario,  only  the  28.500  cross-
border  workers  can  claim  unemployment  benefits  from  the 
State  of  last  activity  (73.700  –  45.200  frontier  workers).  This 
explains  why  the  70-30%  division  between  the  State  of  last 
activity  and  the  State  of  residence  moves  to  88%-12%  under 
this  option,  as  more 
receive 
frontier  workers  will 
unemployment benefits from the State of last activity.  

The  impact  on  fundamental  rights  is  the  same  as  for  option 2. 
The  right  to  property  (Article  17)  is  protected,  as  the  person 
will  always  have  an  entitlement  to  unemployment  benefits 
corresponding to the period of contributions paid into a system. 

Other impacts 

Regulatory Costs 

+ 

Depending on the employment history of the person during the 

277 The same calculation method has been used as for option 1. Calculations are based on the assumption that the ‘sufficiently representative 
period’ is set at 12 months. 

EN 

98 

   EN 

 
 
                                                 
last  12  months,  the  competence  for  paying  unemployment 
benefits  will  switch  between  the  State  of  last  activity  and  the 
State  of  residence.  Member  States  do  not  have  to  apply  the 
aggregation  rules  for  determining  the  period  of  12  months  (it 
concerns a minimum period that the person must have worked 
in  the  State  of  last  activity)  and  hence  there  is  additional 
information  exchange  needed  between  the  competent  Member 
State and the State of residence as regards the reference period 
of  12  months.  For  the  opening  of  the  right  to  unemployment 
benefits  the  information  obligations  for  the  person  and  the 
information exchanges between Member States or the purposes 
of aggregation will be the same as under the baseline scenario. 
In  combination  with  the  annulment  of  the  reimbursement 
procedure,  this  option  has  a  postive  impact  on  administrative 
burden  for  the  institutions  in  comparison  to  the  baseline 
scenario.  The  total  amount  of  the  regulatory  costs  for  this 
option  are  estimated  at  around  €  5.1  million,  a  reduction  of 
approximately 4.8 million or 51% of the baseline scenario. As 
verification  of  jobseeking  activities  and  benefit  payment  will 
both  be  dealt  with  by  the  same  institution  in  the  State  of  last 
activity,  this  option  can  help  reduce  administrative  burden 
caused by 'cross-border' monitoring of the benficiary. 

This option itself does not lead to an increased risk of fraud and 
abuse. There is no incentive for 'opportunistic behaviour' due to 
the  binding  effect  of  the  conflict  rule.  Moreover,  this  option 
excludes the possibility that a person can claim unemployment 
benefit  in  a  Member  State  after  having  worked  there  for  only 
one day,  or  too  short  a  period  to  have  a  genuine  link  with  the 
labour market of the State of last activity. Periods of insurance 
in other Member States cannot be aggregated for the calculation 
of the 12 month period to avoid 'forum shopping'. Verification 
of  jobseeking  activity  and  benefit  payment  are  linked  and 
carried  out  by  the  same  institution.  This  makes  ensuring 
applicable jobseeking activities are being carried out easier for 
the institutions of the State of last activity. 

This option ensures that the cost of the unemployment benefits 
are divided between the relevant Member State in a way that is 
proportional to level of contributions or income tax received by 
the  competent  Member  State.  A  reimbursement  mechanism  is 
no longer needed.  

This  is  a  'compromise'  solution.  It  not  only  restores  the  direct 
link between receiving contributions and paying unemployment 
benefits, but also guarantees a ‘sufficiently close link’ in terms 
of received contributions and labour market integration. It may 
therefore be considered to promote greater efforts by the worker 
to reintegrate into the labour market by requiring the worker to 
register  with  the  employment  services  in  this  location  in  a 
manner aligned to wider EU policy objectives on active labour 
market  policy.  This  can  meet  the  objective  of  proportionate 
sharing of the burden between Member States.  

Risk of fraud and abuse 

+ 

Fair  burden 
Member States 

sharing  between 

+ 

Coherence  with  General,  Specific 
and wider EU Objectives: 

++ 

Continue the  modernisation of the EU 
Social Security Coordination Rules by 
further  facilitating 
the  exercise  of 
citizens'  rights  while  at  the  same  time 
ensuring 
legal  clarity,  a  fair  and 
equitable  distribution  of  the  financial 
burden  among  the  institutions  of  the 
and 
Member 
administrative 
and 
enforceability of the rules. 

simplicity 

involved 

States 

• 

Frontier  and  other  cross-border 
workers,  who  reside  in  another 
Member  State  than  the  State  of 
last  activity,  shall  benefit  from 
the same protection of rights in 
case of unemployment. 

EN 

99 

   EN 

 
 
• 

Frontier  and  other  cross-border 
workers,  who  reside  in  another 
Member  State  than  the  State  of 
last  activity,  shall  benefit  from 
the 
available 
opportunities  of  reintegration 
in the labour market. 

best 

•  The 

for 
financial  burden 
paying  unemployment  benefits 
shall  be  distributed  between 
the  competent  Member  State  of 
last  activity  and  the  Member 
State  of  residence  in  a  manner 
that 
to 
corresponds 
contributions  or  taxes  received 
in  a  way  which  is  easy  to 
administer  and  achieves  fair 
results. 

5.4.6.6 Impacts of Policy Option 3b: Member State of last activity provides the unemployment 
benefits to frontier workers and other cross-border workers only if worker has worked there 
for 12 months– choice of registration for employment services in either Member State of last 
activity or State of residence. 

Policy Option 3b: Introduce the rule in Regulation (EC) No 883/2004 that the State of last activity only 
pays  unemployment  benefit  if  the  person  has  worked  there  for  a  sufficiently  representative  period  – 
choice of registration 

Social impacts 

Clarification 

+ 

This option establishes a direct causal link between the level of 
integration  in  the  labour  market  of  a  Member  State  and 
compensation  for  lost  employment  periods.  The  link  with  the 
labour market arises from the contributions paid in the State of 
activity  and  will  provide  a  balanced  reflection  of 
the 
relationship  between  the  contribution  period  and  acquiring  the 
right to unemployment benefits. 

Simplification 

+/- 

Protection of rights 

+ 

Member States' institutions may have to apply a greater amount 
of  flexibility  when  it  comes  to  recognising  the  availability  for 
the labour market in another Member State with availability in 
the competent Member State and procedures need to be set up 
for that purpose for both the citizen and the national authority.  

for  persons 

This  option  will  be  beneficial 
receiving 
unemployment  benefits  from  the  State  of  last  activity  and 
residing  far  away  from  the  State  of  last  activity.  It  will 
contribute  to  optimising  the  unemployed  person's  chances  of 
resuming  employment  under  the  most  favourable  conditions, 
either in the State of residence or in the State of last activity. 

EN 

100 

   EN 

 
 
Financial impact 

- 

The impact is the same as for option 3a.  

The  costs  for  the  introduction  of  the  cooperation  mechanism 
will be dependent on the specifics of the mechanism and could 
therefore not be quantified. 

Impacts on fundamental rights 

+ 

The impact on fundamental rights is the same as for option 2a. 

Other impacts 

Regulatory Costs 

- 

Risk of fraud and abuse 

+ 

Fair  burden 
Member States 

sharing  between 

+ 

Depending on the employment history of the person during the 
last  12  months,  responsibility  for  paying  unemployment 
benefits  will  switch  between  the  State  of  last  activity  and  the 
State  of  residence.  Member  States  do  not  have  to  apply  the 
aggregation rules for determining the period of 12 months and 
the  Member  State  of  last  activity  only  needs  to  take  into 
account  the  periods  effectively  fulfilled  within  its  territory.  A 
reimbursement procedure is no longer necessary, but additional 
cooperation and control mechanisms need to be established, as 
responsbility  for  paying  the  unemployment  benefits  and 
checking the availability for work lie with different institutions. 
The  cooperation  mechanism  should  not  only  include  regular 
reporting  on  the  situation  of  the  unemployed  person,  but  also 
provide for incentives for the employment services in the State 
of  residence  to  actively  follow-up  on  the  jobseeking  activities 
of 
the  person,  and  possible  financial  compensation  for 
providing  active  labour  market  measures  to  the  person  on 
behalf  of  another  Member  State.  This  will  have  a  negative 
impact in comparison to the baseline scenario. 

This option itself does not lead to an increased risk of fraud and 
abuse. There is no opportunity for the unemployed person to go 
'forum  shopping'  due  to  the binding  effect of  the  conflict  rule. 
Moreover, this option excludes the possibility that a person can 
claim an unemployment benefit in a Member State after having 
worked there for only one day, or too short a period to have a 
genuine link with the labour market of the State of last activity. 
The employment services in the State of residence may need to 
be  incentivised  to  actively  follow-up  on  the  jobseeking 
activities without the responsibility for the payment. 

From the perspective of providing the unemployment benefits, 
this  option  establishes  a  direct 
link  between  receiving 
contributions  and  providing  unemployment  benefits.  There  is 
no  need  for  reimbursement  of  the  unemployment  benefits. 
Active  labour  market  assistance  measures  will,  in  the  first 
place, be at the expense of the employment services in the State 
of residence. 

Coherence  with  General,  Specific 

+ 

This  option  offers  the  person  concerned  the  opportunity  to 
register with the employment services in the State of residence. 

EN 

101 

   EN 

 
 
 
 
 
 
From the point of view of the need for a sufficiently close link 
with  the  labour  market,  is  seems  more  difficult  to  justify  why 
payment  of  benefits  should  be  separated  from  availability  for 
the  labour  market.  Without  a  cooperation  and  reimbursement 
mechanism,  the  incentive  for  the  institution  in  the  State  of 
residence  to  actively  support  the  unemployed  person  could  be 
low.  This  therefore  may  not  be  considered  coherent  with  the 
wider  EU  policy  objective  to  promote  greater  support  and 
labour  activation  measures  to  promote  reintegration  into  the 
the 
labour  market.  This  option 
unemployed  person  concerned,  but  has  as  an  important 
drawback  in  that  it  necessitates  setting  up  a  new  cooperation 
mechanism,  which  may  increase  regulatory  burden  contrary  to 
the objective of establishing an easy to administer system. 

is  more  effective  for 

and wider EU Objectives: 

Continue  the  modernisation  of  the  EU 
Social Security Coordination Rules by 
further  facilitating 
the  exercise  of 
citizens'  rights  while  at  the  same  time 
legal  clarity,  a  fair  and 
ensuring 
equitable  distribution  of  the  financial 
burden  among  the  institutions  of  the 
and 
Member 
administrative 
and 
enforceability of the rules. 

simplicity 

involved 

States 

• 

• 

Frontier  and  other  cross-border 
workers,  who  reside  in  another 
Member  State  than  the  State  of 
last  activity,  shall  benefit  from 
the same protection of rights in 
case of unemployment. 

Frontier  and  other  cross-border 
workers,  who  reside  in  another 
Member  State  than  the  State  of 
last  activity,  shall  benefit  from 
the 
available 
opportunities  of  reintegration 
in the labour market. 

best 

•  The 

for 
financial  burden 
paying  unemployment  benefits 
shall  be  distributed  between 
the  competent  Member  State  of 
last  activity  and  the  Member 
State  of  residence  in  a  manner 
to 
corresponds 
that 
contributions  or  taxes  received 
in  a  way  which  is  easy  to 
administer  and  achieves  fair 
results. 

5.4.7  Conclusions – Combination of Preferred Options 

Except for the horizontal option on the recognition of periods for the purpose of their aggregation, all 
the  other  options  cannot  be  seen  in  isolation.  A  compromise  is  required  between  the  objective  to 
ensure  a  proportionate  distribution  of  the  financial  burden,  the  objective  of  providing  a  unifom  and 
consistent application of the aggregation and culcuation rules that reflect the degree of integration of 
the  worker  with  the  insurance  system  and  the  objective  to  ensure  the  best  conditions  for  the 
unemployed person for reintegration in the labour market  and to protect him/her against the loss of 
rights. 

Such a compromise should aim at ensuring that a Member State becomes responsible for paying the 
unemployment benefit only after a sufficient link had been established by the mobile  worker to the 
scheme  in  question,  it  should  aim  at  ensuring  administrative  simplicity  which  means  that  –  where 
possible –the full administrative procedure of registration, determination and payment of benefits, and 
assistance in offering job opportunities should be in the hand of one institution and that this competent 
institution  should  be,  where  possible,  the  institution  which  is  in  close  distance  to  the  place  of 
residence of the beneficiary. Should the latter not be the case, then an extended period for exporting 
unemployment  benefits  will  allow  the  unemployed  person  to  stay  in  or  return  to  the  Member  State 
with which he/she has the closest ties and the highest probability of finding a job. 

From the comparison of the options under Section 7, it follows that: 

For  the  coordination  of  unemployment  benefits,  the  best  compromise  would  be  a  combination  of 
option  2b  for  the  aggregation  of  periods  in  combination  with  the  horizontal  option  regarding  the 

EN 

102 

   EN 

 
 
recognition  of  periods  for  the  purpose  of  aggregation,  option  1  for  the  export  of  unemployment 
benefits, and option 3a for competence and registration, of. 

This combination of options would ensure that: 

a)  Periods  completed  in  another  Member  State  are  only  taken  into  account  by  way  of 
aggregation, where those periods would also have been considered as periods of insurance in 
that Member State where they have been completed; 

b)  The  Member  State  of  last  activity  becomes  competent  for  the  aggregation  of  periods  in  all 
cases in which the insured person had been most recently insured that State for at least three 
months; 

c)  The  Member  State  of  previous  activity  becomes  competent  and  has  to  export  the  benefit 

whenever this condition has not been satisfied; 

d)  Cash benefits are exported, i.e. are paid to unemployed persons looking for a job in another 
Member State than the competent one for an extended period of at least six months in order to 
provide sufficient time for an effective job search; 

e)  The  Member  State  of  last  activity  would  remain  competent  for  providing  unemployment 
benefits to frontier and other cross-border workers in all cases where those persons have been 
insured there for at least 12 months, because it can be assumed that this suffices to create a 
strong link to the labour market of this State; 

f)  The  Member  State  of  residence  becomes  competent  for  those  who  have  not  satisfied  this 

requirement and thus have not established such a strong link. 

EN 

103 

   EN 

 
6.  Access by econonically inactive mobile citizens to certain social benefits 

6.1. 

Introduction 

For a number of years social security institutions have had to deal with two distinct sets of EU rules 
regarding access to welfare benefits by economically inactive citizens from other EU Member States. 
On  the  one  hand,  Regulation  (EC)  No  883/2004  which  provides  for  equal  treatment  in  relation  to 
social security benefits. On the other hand, Directive 2004/38/EC on the right of citizens of the Union 
and their family members to move and reside freely within the territory of the Member States (“the 
Free Movement Directive”)278 which applies limitations and conditions to the residence of EU citizens 
and their families in other Member States and contains a number of exceptions from equal treatment 
as  regards  access  to  Member  States'  social  assistance  systems.  Although  Regulation  (EC)  No 
883/2004 and Directive 2004/38/EC were negotiated partly at the same time and adopted by the EU 
legislators on the same day (30 April 2004), Regulation (EC) No 883/2004 makes no reference to the 
Directive; nor does the Directive make any reference to the coordination Regulation. The relationship 
between the two sets of rules has therefore not been entirely clear.  

Social  assistance  encompasses  all  assistance  schemes  established  by  the  public  authorities  to  which 
recourse may be made by an individual who does not have resources sufficient to meet his own basic 
needs  and  those  of  his  family.  By  reason  of  that  fact,  such  an  individual  may,  during  his  period  of 
residence,  become  a  burden  on  the  public  finances  of  the  host  Member  State  which  could  have 
consequences for the overall level of assistance which may be granted by that State.  

Regulation  (EC)  No  883/2004  extends  to  all  legislation  concerning  defined  categories  of  social 
security.  The  material  scope  is  exhaustive.  Consequently,  a  branch  of  social  security  which  is  not 
mentioned, is in principle, outside the scope of the regulation. This is the case, for instance, for social 
assistance. 

However,  some  benefits,  falling  within  the  Regulation,  the  so-called  special  non-contributory  cash 
benefits  (SNCBs),  have  characteristics  both  of  social  security  legislation  and  of  social  assistance. 
SNCBs  are  defined  as  benefits  which  are  provided  under  legislation  which,  because  of  its  personal 
scope,  objectives  and/or  conditions  for  entitlement,  has  characteristics  both  of  the  social  security 
legislation and of social assistance (Article 70(1) Regulation (EC) No 883/2004). 

SNCBs  can  either  provide  supplementary,  substitute  or  ancillary  cover  against  the  risks  covered  by 
the branches of social security, and which guarantee the persons concerned "a minimum subsistence 
income having regard to the economic and social situation in the Member State concerned” or “solely 
specific  protection  for  the  disabled,  closely  linked  to  the  said  person's  social  environment  in  the 
Member State concerned” (Article 70(2)(a) Regulation (EC) No 883/2004).  

If all conditions for belonging to the SNCB category are satisfied and if the claimant falls within the 
personal  scope  of  Regulation  (EC)  No  883/2004,  SNCBs  are  provided  exclusively  in  the  Member 
State where the persons concerned reside, in accordance with its legislation and are not exportable. 

As explained below, the access of economically inactive EU citizens and jobseekers to social benefits 
constituting social assistance in the Member State where they are not nationals has been the subject of 
rulings  form  the  Court  of  Justice  in  recent  years,  which  have  clarified  the  relationship  between  the 
Regulation and the Free Movement Directive. At the time of preparing this Impact Assessment Report 
the jurisprudence of the Court of Justice was limited to finding that SNCBs  could be subject to the 
conditions of the Free Movement Directive.  

On 14 June 2016 the Court gave its ruling in the case of C-308/14 European Commission v United 
Kingdom holding that access of economically inactive EU citizens to classic social security benefits 
(not constituting social assistance within the meaning of the Free Movement Directive) could also be 
subject to such conditions.279  This ruling has impacted on the base line scenario and hence also on the 

278 OJ L158, 30.4.2004, p.77. 
279 C-308/14 European Commission v United Kingdom. 

EN 

104 

   EN 

 
                                                 
impact  assessment  of  alternative  options  compared  to  that  scenario.  Following  the  judgment, 
codifying  the  case  law  of  the  Court  by  introducing  a  dynamic  reference  to  the  limitations  to  equal 
treatment in the Free Movement Directive implies that, in relation to economically inactive persons, 
Member States may make the access both to social assistance and social security benefits, subject to 
fulfilling the conditions referred to in that Directive. The situation is different in respect of jobseeker 
whose right of residence is conferred directly by Article 45 of the Treaty on the Functioning 
of  the  European  Union.  As  a  consequence,  for  economically  inactive  citizens,  options  1a  and  1b 
have  become  virtually  the  same;  and  option  1c  and  2  have  been  overtaken  by  the  jurisprudence.  It 
should be noted, however, that following this judgment option 1a must be understood as permitting 
Member States, for economically inactive citizens, to derogate from the principle of equal treatment 
in  respect  of  social  security  as  well  as  social  assistance  where  such  a  person  does  not  fulfil  the 
conditions  for  legal  residence  as  set  out  in  the  Free  Movement  Directive,  while  for  jobseekers  that 
limitation  is  only  possible  in  relation  to  social  assistance.  As  this  report  had  been  approved  by  the 
Regulatory Scrutiny Board prior to the aforementioned judgment, the authors have not substantially 
revised  the  options  described  below  or  the  analysis  of  their  impact,  which  does  not  reflect  this 
differentiated treatment of economically inactive citizens and jobseekers. 

6.2. 

Problems with access by economically inactive mobile citizens to certain social benefits 

6.2.1  Lack of clarity and transparency for economically inactive mobile EU citizens and 
institutions concerning entitlement to certain social benefits  

According  to  the  recent  jurisprudence  of  the  CJEU,  Member  States  may  choose  to  limit  equal 
treatment  for  special  non-contributory  cash  benefits  claimed  by  economically  inactive  citizens  and 
jobseekers to the extent permitted by the Free Movement Directive. Specifically the Free Movement 
Directive  provides  that  there  is  no  obligation  for  Member  States  to  award  social  benefits  for  an 
economically inactive citizen for the first three months of residence and after three months Member 
States  may  still  refuse  to  award  benefits  if  the  person  lacks  sufficient  resources  not  to  impose  an 
unreasonable burden on the host Member State or does not have comprehensive sickness insurance. 
This  is  not  however  apparent  from  the  current  wording  of  Regulation  (EC)  No  883/2004,  which 
suggests that all mobile citizens are entitled to full equal treatment. In the absence of clear wording 
within the Regulation, economically inactive EU mobile citizens and jobseekers do not have a clear 
view of what their rights are. This lack of transparency also affects national social security institutions 

EN 

105 

   EN 

 
 
 
 
which pay such benefits. This is also reflected in the high number of court cases instituted in some 
Member  States  (in  particular  in  Germany  but  also  in  the  United Kingdom)  seeking  clarity as  to  the 
interaction between the Free Movement Directive and Regulation (EC) No 883/2004.280  

The driver behind these specific problems is the recent jurisprudence of the Court that has changed 
the previous understanding of the relationship between the Social Security Coordination Rules and the 
Free Movement Directive. In September 2013 the Court of Justice delivered a judgment in Case C-
140/12 Brey, subsequently confirmed in Case C-333/13 Dano in November 2014, which clarified that 
Regulation  (EC)  No  883/2004  on  the  coordination  of  social  security  systems  can  in  certain 
circumstances  be  read  in  conjunction  with  the  provisions  of  the  Free  Movement  Directive.  Both 
judgments concerned economically inactive EU mobile citizens who were claiming a specific type of 
minimum  subsistence  benefit,  classified  as  a  “special  non-contributory  cash  benefit”  within  the 
meaning  of  Regulation  (EC)  No  883/2004.  The  Court  held  that  these  benefits  could,  under  certain 
conditions, be regarded as social assistance within the meaning of the Free Movement Directive and 
that therefore the exceptions from equal treatment in the Directive could be applied to such benefits.  

These  conclusions  were  confirmed  in  the  Court’s  judgment  of  15  September  2015  in  Case  C-67/14 
Alimanovic  where  the  Court  provided  clarification  of  when  EU  law  requires  Member  States  to  pay 
social assistance benefits to jobseekers (mobile jobseekers enjoy a specific legal status under EU law 
and form a separate category of mobile citizens from economically inactive citizens281). In particular, 
the  Court  held  that  special  non-contributory  cash  benefits  providing  for  a  minimum  level  of 
subsistence and which form part of a scheme which also provides for benefits to facilitate the search 
for employment282, are to be considered as social assistance if this is their predominant function. The 
Court  also  held  that  jobseeking  EU  citizens  who  have  worked  for  less  than  one  year,  in  case  of 
involuntary unemployment retain their status of workers for no less than 6 months as provided for in 
Article  14(4)b  of  the  Directive.  As  long  as  they  retain  their  status  as  workers,  these  jobseeking  EU 
citizens benefit from equal treatment and thus are entitled to social assistance benefits for this period 
of  six  months.  After  that  period  of  six  months,  Member  States  are  not  obliged  to  grant  social 
assistance  by  virtue  of  Article  24(2)  of  the  Directive  which  allows  Member  States  not  to  confer 
entitlements  to  social  assistance  during  the  longer  period  provided  for  in  Article  14(4)b  of  the 
Directive.  The  Court  clarified  that  there  was  no  need  to  carry  out  an  individual  assessment  before 
refusing to grant such benefits beyond the period of six months since such a proportionality test had 
already been carried out by the legislator by setting the conditions in the Directive. 

The recent judgments of the Court mean that Member States can choose to limit equal treatment for 
special non-contributory cash benefits (and potentially other non-contributory tax financed benefits) 
claimed  by  these  economically  inactive  citizens  and  jobseekers  to  the  extent  permitted  by  the  Free 
Movement  Directive.  This  is  not  however  apparent  from  the  wording  of  Regulation  (EC)  No 
883/2004, which still suggests that full equal treatment is the rule and furthermore the material scope 
of  this  derogation  remains  unclear  pending  the  judgment  of  the  Court  in  case  C-308/14  European 
Commission  v  United  Kingdom.283  This  means  economically  inactive  EU  mobile  citizens  and 
jobseekers  do  not  have  a  clear  view  of  what  their  rights  are.  It  also  affects  national  social  security 
institutions which pay such benefits: EU legislation does not set out what limitations they can apply to 

280  There  have  been  99  first  instance  court  or  tribunal  decisions  in  Germany  since  1  May  2010  concerning  the  relationship  between 
Regulation (EC) no 883/2004 and Directive 2004/38/EC, 67 of which have been appealed to a higher national court . There have been 11 
first instance court or tribunal decisions in Germany since 1 May 2010 concerning the relationship between Regulation (EC) no 883/2004 
and Directive 2004/38/EC, 2 of which have been appealed to a higher national court. 

281 See Recital 9 and Article 14(4)(b) of Directive 2004/38/EC. 
282  the  CJEU  has held  that  Member  States  must  accord  jobseekers  from  other  Member  States  equal  treatment  in  respect  of  "benefits  of a 
financial nature intended to facilitate access to employment in the labour market of a Member State", provided the jobseeker can show "a 
genuine link” with “the employment market of that state" Case C-138/02 Collins of 23 March 2004, para. 63. 
283  The  case  C-308/14  European  Commission  v  United  Kingdom  (judgment  pending)  relates  to  the  question  of  whether  it  is  possible  to 
require  a  right  of  residence  as  a  condition  of  access  to  tax  financed  family  benefits.  Advocate  General  Cruz  Villalón's  indicated  in  his 
opinion dated 6 October 2015 that there was nothing to indicate that the findings of the Court in the cases of Brey and Dano should apply 
exclusively  to  social  assistance  benefits  or  special  non-contributory  benefits  with  which  those  cases  were  concerned  (paragraph  74).  The 
scope of "social assistance" and whether or not it may include certain classic social security benefits was also raised by a number of Member 
States in the Reflection Forum of the Administrative Commission in December 2014 and June 2015.  

EN 

106 

   EN 

 
                                                 
payment of benefits to economically inactive EU mobile citizens and jobseekers. This is also reflected 
in the high number of court cases instituted in some Member States (in particular in Germany but also 
in  the  United  Kingdom)  seeking  clarity  as  to  the  interaction  between  the  Free  Movement  Directive 
and Regulation (EC) 883/2004.284 

The consequences of this problem are that there is a lack of clarity and transparency for EU citizens as 
regards their right to claim special non-contributory cash benefits in their host state in order to have a 
minimum subsistence. There is also a similar lack of clarity for mobile jobseekers on whether they are 
entitled  to  access  subsistence  jobseekers’  benefits  when  looking  for  work  in  their  host  State. 
Moreover, social security institutions which are responsible for taking decisions on claims to benefits 
made  by  these  groups  of  mobile  citizens  do  not  have  the  necessary  legal  certainty  in  the  rules.  In 
particular in relation to the question of whether for the purposes of Regulation (EC) No 883/2004, the 
exceptions from equal treatment in the Directive apply only to special non-contributory cash benefits 
providing  for  a  minimum  level  of  subsistence,  or whether  the  principle  may  extend  further  to  other 
types of "classic" social security benefits for the purposes of the EU social security coordination rules. 
This  question  still  awaits  clarification  in  the  case  of  C-308/14  European  Commission  v  United 
Kingdom.285  

6.3. 

Baseline Scenario 

Out of a total EU-28 mobile population of 14.3 million in 2014286, there were an estimated 3.7 million 
economically  inactive  mobile  EU  citizens287.  If  we  assume  that  the  3.1%  average  yearly  growth  of 
mobile  EU  citizens  between  2009  and  2014  continues  between  2015  and  2020,  and  that  the  ratio 
between active and non-active mobile EU citizens also remains constant, then we can expect that in 
2020,  out  of  a  total  EU-28  mobile  population  of  17.5  million288,  there  will  be  some  4.4  million 
economically inactive mobile EU citizens289. 

This  group  comprises  many  vulnerable  citizens,  for  example,  old-age  pensioners,  persons  with  a 
disability who cannot work, parents temporarily outside of the labour market as they are looking after 
children. Nearly 80% of economically inactive mobile citizens derive rights (residence rights and/or 
rights to benefits) from economically active family  members with whom they are living in the host 
Member  State  and  are  entitled  to  equal  treatment  with  the  family  members  of  national  workers. 
However,  there  still  remains  a  significant  group  of  economically  inactive  mobile  EU  citizens  who 
cannot derive rights from others. It is this group of EU citizens that is affected by the current lack of 
clarity  and  transparency  as  regards  their  right  to  claim  certain  social  benefits  in  their  host  state  in 
order to have a minimum subsistence income on which to live.  

Mobile jobseekers are also affected by this lack of transparency. There are in the region of 1 million 
EU jobseekers looking for employment in Member States other than their own290. Assuming that the 
unemployment rate in the EU between 2015 and 2020 remains at 11.7%, and that the share of mobile 
EU jobseekers over the total EU population also remains constant at 9%, then we can estimate that in 
2020 there will be some 1.2 million EU jobseekers looking for employment in Member States other 

284  There  have  been  99  first  instance  court  or  tribunal  decisions  in  Germany  since  1  May  2010  concerning  the  relationship  between 
Regulation (EC) no 883/2004 and Directive 2004/38/EC, 67 of which have been appealed to a higher national court. There have been 11 
first instance court or tribunal decisions in Germany since 1 May 2010 concerning the relationship between Regulation (EC) no 883/2004 
and Directive 2004/38/EC, 2 of which have been appealed to a higher national court.  
285 C-308/14 European Commission v United Kingdom (ibid). 
286 All ages (LFS, 2014). 
287 All ages except 0-14 (LFS, 2014). 
288 All ages. 
289 All ages except 0-14.  

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than  their  own.  Moreover,  25%  of  EU  citizens  say  they  would  definitely  (8%)  or  probably  (17%) 
consider working in another EU country in the next ten years.291  

6.4.  Objectives  for  the  review  of  the  rules  on  access  by  economically  inactive  citizens  to 

certain social benefits 

This initiative serves to facilitate the exercise of the right to free movement by creating and enabling a 
conducive environment. It is in the interest of all parties to design co-ordination rules that allow full 
exercise of citizens' rights whilst making the requirements of Member States clear, manageable and 
efficient. 

As with other elements of the revision, the general policy objective of this initiative is to continue the 
modernisation  of  the  EU  Social  Security  Coordination  Rules  by  further  facilitating  the  exercise  of 
citizens'  rights  while  at  the  same  time  ensuring  legal  clarity,  a  fair  and  equitable  distribution  of  the 
financial burden among the institutions of the Member States involved, and administrative simplicity 
and enforceability of the rules. 

In  particular,  this  is  reflected  in  the  need  to  ensure  legal  clarity  in  the  rules  in  relation  to  the 
limitations and conditions to the residence of EU citizens and their families in other Member States 
and  the  exceptions  from  equal  treatment  as  regards  access  to  Member  States'  social  assistance 
systems. This is also an issue of protection of rights as in the absence of clarity in the current rules 
there is inconsistent treatment of such benefits by different Member States which creates uncertainty 
for citizens and competent institutions and consequent difficulties in enforceability and litigation risk. 
Promoting  legal  certainty  is  therefore  also  anticipated  to  improve  effective  and  efficient 
administration and reduce administrative burden.  

The specific objective can be defined as follows: 

Ensure legal clarity and transparency on the distinctions between the rights of workers, jobseekers and 
economically  inactive  mobile  EU  citizens,  including  the  extent  to  which  Member  States’  social 
security  institutions  are  permitted  to  limit  the  equal  treatment  principle  for  economically  inactive 
mobile EU citizens and jobseekers who claim certain tax financed social benefits. 

291 Special Eurobarometer 398 – Internal Market, October 2013. 

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6.5.  Options for addressing the problems of access by economically inactive mobile citizens 

and jobseekers to certain social benefits  

6.5.1  Option 0: Baseline scenario 

The case-law of the Court is directly applicable in national law and this option leaves it to national 
decision-makers to apply the Court’s judgments directly. Where questions of interpretation arise, they 
can be solved in national courts, which if necessary can refer issues to the Court. 

6.5.2  Option 1: Amendment of Regulation (EC) No 883/2004 to make reference to the 
limitations in Directive 2004/38EC 

This  option  codifies  the  Court's  case-law  by  stipulating  that  the  equal  treatment  principle  of 
Regulation  (EC)  No  883/2004  may  be  limited  in  relation  to  payment  of  certain  social  benefits  to 
economically inactive mobile EU citizens and jobseekers. 

As the discussion with experts in the Administrative Commission in June 2015 showed, it is possible 
to  take  either  a  broad  or  a  narrow  approach  to  amending  Regulation  (EC)  No  883/2004  to  make 
reference  to  the  Free  Movement  Directive.  Option  1  can  therefore  be  sub-divided  into  three  sub-
options: 

•  Introducing a general amendment to the equal treatment principle in Article 4 of Regulation (EC) 

No 883/2004 by referring to the possible limitations in Directive 2004/38/EC 

•  Introducing a general amendment to the equal treatment principle in Article 4 of Regulation (EC) 
No  883/2004  by  referring  to  the  possible  limitations  in  Directive  2004/38/EC,  but  extending  the 
limitations by analogy to other tax-financed benefits  

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•  Making a more limited amendment to Article 70 of Regulation (EC) No 883/2004, which permits 
Member  States  to  limit  equal  treatment  only  in  relation  to  the  specific  category  of  special  non-
contributory cash benefits, which provide subsistence income. 

6.5.2.1 Option 1a Amendment of Article 4 of Regulation (EC) No 883/2004 to make a 
dynamic reference to the limitations to equal treatment in Directive 2004/38/EC 

This  option  would  permit  Member  States  to  apply  the  provisions  of  the  Free  Movement  Directive 
generally to limit equal treatment in Regulation (EC) No 883/2004. This option would permit national 
legislators  to  derogate  from  the  principle  of  equal  treatment  in  respect  of  social  assistance  in 
accordance  with the limitations in  Directive 2004/38/EC specifically to provide that Member States 
are not obliged to award social benefits to economically inactive persons or first time jobseekers for 
the  first  three  months  of  residence  and  further  are  only  required  to  award  social  benefits  to  an 
economically inactive citizen or first time jobseeker after three months of residence if that person has 
sufficient  resources  not  to  pose  an  unreasonable  burden  on  public  finances  and  has  comprehensive 
sickness  insurance.  This  option  does  not  propose  to  define  the  material  scope  of  social  assistance 
within  Regulation  (EC)  No  883/2004  meaning  that  it  can  evolve  according  to  the  case  law  of  the 
Court of Justice.  

6.5.2.2. Option 1b: Amendment of Article 4 of Regulation (EC) No 883/2004 to make a dynamic 
reference to the limitations to equal treatment in Directive 2004/38/EC and to extend these 
limitations by analogy to other tax-financed benefits  

This option would also permit national legislators to derogate from the principle of equal treatment in 
respect of social assistance in accordance with the limitations in Directive 2004/38/EC as described in 
option 1a.  In  addition,  it would  expressly  define  the  material  scope  to  apply to  certain  tax-financed 
social  security  benefits,  specifically  non-contributory  family  benefits,  long-term  care  benefits  and 
sickness  benefits  for  economically  inactive  EU  mobile  citizens  and  jobseekers  in  the  same  way  as 
special non-contributory cash benefits, which provide subsistence income.  

6.5.2.3 Option 1c Amendment of Article 70 of Regulation (EC) No 883/2004 to make a 
reference to the limitations in Directive 2004/38/EC in the context of benefits that provide a 
minimum subsistence income  

This  option  would  make  clear  that  Member  States  can  apply  the  provisions  of  the  Free  Movement 
Directive to limit equal treatment only in relation to special non-contributory cash benefits providing 
a minimum subsistence income under Regulation (EC) No 883/2004. This would have the effect of 
permitting national legislators to derogate from the principle of equal treatment in relation to a limited 
category  of  benefits  only,  namely  special  non-contributory  cash  benefits  linked  to  minimum 
subsistence income payable to economically inactive citizens.  

The  report  of  the  FreSsco  network  of  experts  on  free  movement  of  workers  and  social  security 
coordination  identified  this  as  a  possible  legislative  solution  for  dealing  with  the  Court's  recent 
judgments. It noted that Article 70 of the Regulation would be the appropriate place to incorporate a 
new provision dealing with access to social assistance benefits.292 

6.5.3  Option 2: Remove SNCBs providing subsistence income from Regulation (EC) No 
883/2004 

This  option  removes  SNCBs  which  provide  a  minimum  subsistence  income  from  the  scope  of 
Regulation  (EC)  No  883/2004.  This  would  effectively  de-classify  such  benefits  as  "social  security 
benefits" and would leave them subject to a common, albeit non-coordinated, regime of rules under 
the Free Movement Directive concerning all benefits classified as social assistance.  

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The  report  of  the  FreSsco  network  of  experts  advised  against  this  option  on  the  ground  that  such  a 
change would be detrimental for both citizens and for social security administrations as many of the 
practical and protective rules in the social security coordination rules would no longer apply.293 The 
option is retained nonetheless as it offers a simple solution for dealing with the impact of the Court's 
rulings. 

6.5.4  Option 3: Provide administrative guidance 

This option takes a “soft law” approach through which the Commission would draw up administrative 
guidance on how the Court’s judgments should be interpreted. Such guidelines could deal with both 
questions of what benefits are covered by the judgments and with the extent to which the rules of the 
Free  Movement  Directive  limit  rights  in  Regulation  (EC)  No  883/2004.  Such  guidance  would  offer 
the advantage of containing considerably more detail than a legislative amendment. It is also easier to 
update  and  change  guidance  than  in  the  case  of  legislation.  Moreover,  given  the  opportunities  for 
consultation  with  national  administrators  in  drawing  up  this  guidance,  it  should  also  meet  the 
objectives  of  ensuring  as  far  as  possible  a  common  understanding  of  the  judgments  and  a  uniform 
application by national social security institutions. This option could stand on its own or be combined 
with another option. 

6.6. 

Stakeholder support 

6.6.1  Baseline Scenario 

This  option  was  supported  by  nine  delegations  as  a  first  or  second  choice  in  discussions  in  the 
Administrative Commission in June 2015294. In addition, nine delegations supported the status quo as 
at least a short-term strategy, given that further judgments of the CJEU are pending295.296 

6.6.2  Option 1: Amendment of Regulation (EC) No 883/2004 to make reference to the 
limitations in Directive 2004/38/EC 

6.6.2.1 Option 1a Amendment of Article 4 of Regulation (EC) No 883/2004 to make a 
dynamic reference to the limitations to equal treatment in Directive 2004/38/EC 

In discussions in the Administrative Commission in June 2015, eleven Member States supported this 
option  as  a  first  or  second  choice297.  However,  there  was  no  consensus  on  exactly  how  such  an 
amendment  should  be  drafted  and  some  of  those  Member  States  were  in  favour  of  awaiting  the 
outcome of the pending court cases before adopting a fixed position. 

6.6.2.2 Option 1b Amendment of Article 4 of Regulation (EC) No 883/2004 to make a dynamic 
reference to the limitations to equal treatment in Directive 2004/38/EC and to extend these 
limitations by analogy to other tax-financed benefits 

This option has not been subject to discussions with external stakeholders. 

6.6.2.3 Option 1c Amendment of Article 70 of Regulation (EC) No 883/2004 to make a 
reference to the limitations to equal treatment in Directive 2004/38/EC in the context of 
SNCBs that provide for a minimum subsistence level  

No Member State expressly supported this proposal. 

293 See Annex VIII at p.52. 
294 Malta, Hungary, Italy, Poland, Portugal, Finland, Lithuania, Sweden and Spain. 
295 Czech Republic, Germany, France, Lithuania, Latvia, Luxembourg, Netherlands, Sweden and United Kingdom. 
296 Case C-299/14 Garcia-Nieto; Case C-308/14 Commission v United Kingdom. 
297 Austria, Belgium, Czech Republic, Germany, Estonia, France, Ireland, Lithuania, Latvia, Poland, United Kingdom 

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6.6.3  Option 2: Remove SNCBs providing subsistence income from Regulation (EC) No 
883/2004 

In  discussions  in  the  Administrative  Commission  in  June  2015,  two  Member  States  supported  this 
option298. Eight Member States regarded this option as being a backward step in the development of 
the EU rules on social security coordination.  

6.6.4  Option 3: Provide Administrative Guidance 

In  discussions  in  the  Administrative  Commission  in  June  2015,  four  Member  States  favoured  this 
option299.  

Consultations with social partners and NGOs indicated mixed views as to whether there was a need 
for  change  in  relation  to  access  to  benefits  by  economically  inactive  persons.  Some  stakeholders 
advocated stronger enforcement of the existing legislation to ensure public confidence in the current 
provisions.300  Other  stakeholders  emphasised  the  risks  to  vulnerable  mobile  citizens  and  the 
importance of ensuring such persons were not left without social protection.301 

6.7.  What are the impacts of the Different Options 

6.7.1 

Introduction 

For  all  of  the  options  assessed,  the  potentially  affected  groups  are  the  same.  The  options  are 
specifically targeted at mobile economically inactive citizens and jobseekers who are unable to derive 
rights from an economically active family member.  

For the purposes of assessing the impact, a range of criteria has been identified with reference to the 
general and specific policy objectives and the Commission's Better Regulation Guidelines. In relation 
to  social  impact,  the  options  are  assessed  against  the  criteria  of  clarification;  simplification; 
protection of rights and impact upon fundamental rights. This analysis draws upon the findings of 
the  FreSsco  Legal  Experts  report  at  Annex  VIII  supplemented  by  the  Commission's  Services  own 
analysis and the findings from the stakeholder consultations and the Inter-Service Steering Group. 

In relation to the economic impact and regulatory costs for both public administrations and citizens 
no specific studies have been conducted as, with the limited exception of Option 1b, the options under 
consideration are codification of the EU case-law which is already directly applicable and therefore 
there is no anticipated impact on Member States' budgets. However, potential administrative burden 
of implementing the various options under consideration have been qualitatively assessed.  

In  relation  to  option  1b,  it  should  be  noted  that  the  estimated  budgetary  impact  may  be  an  under-
estimation  for  the  EU-28.  Calculations  have  been  based  on  data  from  LFS  2012  of  proportion  of 
EU28/EFTA migrants residing less than 1 year in their new Member State of residence including the 
proportion  who  live  in  a  household  with  at  least  one  child  where  no  adults  in  the  household  are  in 
work  for  the  age-group  15-64  compared  with  all  ages  and  the  proportion  aged  over  65.  This 
estimation has limitations as it is not possible to identify what proportion of the identified group are 
unemployed jobseekers or how long such jobseekers may have been seeking work. There is also no 
information about the level of income or resources of the identified group or whether or not they are 
currently  in  receipt  of  particular  social  security  benefits.  These  numbers  have  then  been  applied  to 
average expenditure per capita in Member States in relation to long-term care benefits, family benefits 
and sickness benefits. Such a model does not distinguish between contributory and non-contributory 
systems  and  also  assumes  that  EU  mobile  citizens  will  make  use  of  such  benefits  in  the  same 
proportions  as  native  citizens.  The  calculation  needs  to  be  construed  in  light  of  these  multiple 
limitations.  

298 Estonia and Ireland. 
299 Spain, Finland, Hungary, Sweden 
300 For example CEC and Business Europe 
301 For example, Eurodiaconia 

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 With  reference  to  coherence  with  the  general  objective,  the  options  have  also  been  assessed  with 
reference to their impact upon; legal clarity; risk of fraud and abuse and ability of Member States to 
counteract  such  risks  and  by  reference  to  the  objective  of  achieving  equitable  burden-sharing 
between  Member  States  (corresponding  to  the  specific  objective  to  ensure  legal  clarity  and 
transparency on the distinctions between the rights of workers, jobseekers and economically inactive 
mobile  EU  citizens,  including  the  extent  to  which  Member  States’  social  security  institutions  are 
permitted  to  limit  the  equal  treatment  principle  for  economically  inactive  mobile  EU  citizens  and 
jobseekers who claim certain social benefits). 

Finally the assessment considers overall coherence with EU objectives with reference to relevant 
policies identified at section 1.3 of this report.  

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6.7.2  Summary of the impacts of the options for access by economically inactive mobile citizens and jobseekers to certain social benefits 

Type 
impact 

of 

Clarification 

Simplification  Protection  of 

rights 

Fundamental 
rights 

Economic 
impacts 

Regulatory 
costs 

Risk  of  fraud 
and abuse 

Equitable 
burden 
sharing 
Member 
State 

Coherence 
with 
objectives 

EU 

Overall 
Effectiveness 

Overall 
Efficiency 

(cost 
effectiveness 

vs 

0 

+ 

+ 

0 

+ 

+ 

+ 

+/- 

++ 

++ 

0 

+ 

- 

+ 

- 

0 

0 

- 

0 

0 

0 

0 

0 

0 

0 

0 

+/0 

-/0 

+/0 

-- 

0 

+ 

+ 

+ 

- 

0 

0 

0 

0 

0 

0 

+ 

0 

++ 

0 

++ 

+/- 

++ 

++ 

+ 

- 

+ 

- 

+ 

- 

Baseline 
Scenario 

Option 1a 

Legislative 
Amendment to 
Article 4 

Option 1b 

Legislative 
Amendment to 
Article 4 and 
extension of 
limitations  

Option 1c 

Legislative 
Amendment to 
Article 70 

Option 2 

Remove 
SNCBs 
providing for 
subsistence 
income from 
Regulation 

Option 3 

+/0 

++ 

+/0 

0 

0 

+/0 

+ 

0 

+ 

+ 

+ 

Administrative 
Guidance 

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6.7.3 

Impacts of Policy Option 1a: Dynamic reference to Directive 2004/38EC 

Policy  Option  1a:    Amendment  of  Article  4  of  Regulation  (EC)  No  883/2004  to  make  a  dynamic 
reference to the limitations to equal treatment in Directive 2004/38/EC 

Social impact 

Clarification  

Simplification 

Protection of Rights 

Financial impact 

+ 

+ 

+ 

0 

The  codification  of  existing  case-law  would  clarify  the 
rights  of  EU  mobile  citizens  and  would  enable  citizens  to 
make  an  informed  choice  when  exercising  their  rights  to 
move to another Member State.  

their 

The  codification  of  existing  case-law  would  also  simplify 
the  process  whereby  EU  mobile  citizens  and  national 
institutions  could  verify 
rights  and 
obligations  by  making  explicit  the  relationship  between 
Regulation 
the  Directive 
2004/38/EC. As  this  measure  contains  a dynamic  reference 
to  the  Directive,  it  is  anticipated  that  it  will  not  require 
further  amendment  even  if  the  case  law  of  the  CJEU 
continues to evolve. 

(EC)  No  883/2004  and 

respective 

By  increasing  clarity  the  application  of  the  case  law  of  the 
CJEU,  legal  certainty  is  also  increased  thereby  facilitating 
greater  uniformity  in  application  by  Member  States  and 
facilitating the ability of citizens to enforce their rights. 

There will be no direct impact on Member States' budgets as 
this measure simply reflects codification of the case-law of 
the Court. 

Impacts on fundamental rights 

0 

Mere codification of the case-law of the Court. Any impact 
on  fundamental  rights  already  exists  in  EU  law  –  the 
amendment to the Regulation will merely reflect this.  

Other impacts 

Regulatory costs 

+/0 

Costs  related  to  lack  of  clarity/transparency/legal  certainty 
(for  instance  litigation  costs,  legal  advice,  elaboration  of 
administrative  guidance)  for  both  citizens  and  public 
authorities  could  be  reduced.  However,  as  this  option  sets 
out  the  limits  on  the  equal  treatment  principle  only  in  very 
general  terms,  it  is  likely  that  some  litigation  on  the 
relationship between the Regulation and the Directive would 
continue.  Public  administrations  may  additionally  decide 
themselves 
improve  clarity  by  producing  detailed 
guidance at national level (although such measures will be at 
their own discretion).  

to 

EN 

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+ 

0 

+ 

This  option  gives  greater  visibility  to  the  safeguards  in  EU 
law  against  abusive  behavior  including  the  need  to  prevent 
economically  inactive  Union  citizens  from  using  the  host 
Member  State's  welfare  system  to  fund  their  means  of 
subsistence, which may act as a deterrent to such conduct. 

As codification of the case-law this option is not anticipated 
to  have  a  direct  impact  on  the  distribution  of  financial 
burden between Member States. 

This  option  will  increase  legal  clarity  and  transparency  on 
the  rights  of  economically  inactive  mobile  EU  citizens  and 
jobseekers and also on the extent to which Member States’ 
social  security  institutions  are  permitted  to  limit  the  equal 
treatment principle for such persons in relation to access to 
certain  social  benefits.  It  is  anticipated  to  thereby  improve 
administrative simplicity and enforceability of the rules. 

Risk of fraud and abuse 

Fair  burden  sharing  between 
Member States 

Coherence 
Specific 
Objectives: 

with 

and 

wider 

General, 
EU 

Continue  the  modernisation  of  the 
EU  Social  Security  Coordination 
Rules  by  further  facilitating 
the 
exercise  of  citizens'  rights  while  at 
the  same  time  ensuring  legal  clarity, 
a  fair  and  equitable  distribution  of 
the  financial  burden  among 
the 
institutions  of  the  Member  States 
involved 
administrative 
simplicity  and  enforceability  of  the 
rules. 

and 

the 

legal 

clarity 

and 
to 
ensure 
the  distinctions 
transparency  on 
between 
rights  of  workers, 
jobseekers  and  economically  inactive 
mobile  EU  citizens,  including  the 
to  which  Member  States’ 
extent 
social 
are 
security 
permitted to limit the equal treatment 
principle  for  economically  inactive 
mobile  EU  citizens  and  jobseekers 
who claim certain social benefits. 

institutions 

Impacts of Policy Option 1b: Dynamic reference to Directive 2004/38EC and 

6.7.4 
extension of limitations by analogy  

Policy  Option  1b:    Amendment  of  Article  4  of  Regulation  (EC)  No  883/2004  to  make  a  dynamic 
reference to the limitations to equal treatment in Directive 2004/38/EC and extend the limitations by 
analogy 

Social impact 

Clarification  

Simplification 

+ 

+ 

The  option  would  clarify  the  rights  of  EU  mobile  citizens 
and would enable citizens to make an informed choice when 
exercising their rights to move to another Member State.  

The  option  would  also  simplify  the  process  whereby  EU 
mobile  citizens  and  national  institutions  could  verify  their 
respective  rights  and  obligations  by  making  explicit  the 
relationship between Regulation (EC) No 883/2004 and the 
Directive 2004/38/EC. As this measure expressly defines the 
material  scope  to  which  the  conditions  of  the  Directive 
apply it is possible that it may require further amendment  if 
the case law of the CJEU continues to evolve. 

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Protection of Rights 

Financial impact 

- 

0 

Impacts on fundamental rights 

- 

Other impacts 

Regulatory costs 

-/0 

Risk of fraud and abuse 

+ 

In  relation  to  any  extension  of  the  potential  derogation  to 
non-contributory  family  benefits,  long-term  care  benefits 
and sickness benefits there will be a loss of rights compared 
to  the  baseline  scenario.  The  affected  population  of 
economically  inactive  citizens  is  estimated  at  70.700  of 
whom  approximately  14.000  live  in  a  household  with  at 
least one child and of whom 2.500 are aged 65 or older) 

there  would  be  a 

In  relation  to  an  extension  of  the  existing  case-law  to  non-
contributory  family  benefits, 
total 
estimated decrease for the EU-28 of between €37.7 and 79.2 
million (equivalent to a reduction of 0.03% to 0.06% of total 
expenditure  on  child  benefits)302  in  the  case  of  long-term 
care benefits there would be an average estimated decrease 
of €31.5 million (equivalent to 0.014% of total expenditure 
on  long-term  care  benefits)303  and  in  relation  to  sickness 
benefits  there  would  be  an  average  estimated  decrease  of 
€185.1 million (equivalent to 0.017% of total expenditure on 
sickness benefits)304 

The option is expected to adversely affect the best interests 
of  the  child  (Article  24),  the  freedom  to  choose  an 
occupation  and  the  right  to  engage  in  work  in  another 
Member State (Article 15), as well as protection of rights for 
jobseekers  who  have  made  use  of  their  right  to  free 
movement but who do not retain worker status (Article 45). 
There may also be an adverse impact on the right to social 
security  and  social  assistance  (Article  34)  when  compared 
with the baseline scenario.  

The assessment is likely to be similar to option 1a. However, 
by  extending  the  limitations  of  Directive  2004/38/EC  by 
analogy to a wider range of benefit decisions, there may be 
additional  regulatory  costs  for  case  handlers  in  public 
authorities.  Conversely,  there  may  be  a  reduced  risk  of 
ongoing litigation costs as the legislature will have resolved 
the  question  of  whether  or  not  the  limitations  of  the 
Directive apply also to tax-financed social security benefits. 

This  option  gives  greater  visibility  to  the  safeguards  in  EU 
law  against  abusive  behavior  including  the  need  to  prevent 
economically  inactive  Union  citizens  from  using  the  host 

302 Estimation based on HIVA's own calculations. It should be noted that the calculation relates to child benefits and therefore the estimated 
budgetary  impact  may  be  an  under-estimation  for  the  EU-28.  The  calculation  is  made  using  data  in  relation  to  only  9  Member  States 
(although  those  Member  States  have  on  average  a  higher  stock  of  EU  mobile  citizens  than  average)  and  the  calculation  needs  to  be 
construed in light of these limitations.  
303  Annex  XXIV,  Table  2,  Estimation  based  on  HIVA's  own  calculations.  It  should  be  noted  that  the  calculation  relates  to  average 
expenditure  per  capita  in  Member  States  which  does  not  distinguish  between  contributory  and  non-contributory  long-term  care  benefits 
systems.  It  assumes  that  EU  mobile  citizens  will  make  use  of  long-term  care  benefits  in  the  same  proportions  as  native  citizens.  The 
calculation needs to be construed in light of these limitations.  
304  Annex  XXIV,  Table  3,  Estimation  based  on  HIVA's  own  calculations.  It  should  be  noted  that  the  calculation  relates  to  average 
expenditure  on  healthcare  per  capita  in  Member  States  using  ESSPROS  figures.  It  assumes  that  EU  mobile  citizens  will  make  use  of 
healthcare in the same proportions/frequency as native citizens. The calculation needs to be construed in light of these limitations.  

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0 

+/- 

Member  State's  welfare  system  to  fund  their  means  of 
subsistence, which may act as a deterrent to such conduct. 

This option is not anticipated to have a direct impact on the 
distribution of financial burden between Member States. 

This option may be considered coherent with the wider EU 
objective  of  supporting  fair  mobility  (fair  for  both  mobile 
citizens and tax-payers in the State of destination) but is less 
coherent  with  objectives  to  promote  a  social  agenda  in 
particular in relation to mobility for more vulnerable groups 
within the Union.  

Fair  burden  sharing  between 
Member States 

Coherence 
Specific 
Objectives: 

with 

and 

wider 

General, 
EU 

Continue  the  modernisation  of  the 
EU  Social  Security  Coordination 
Rules  by  further  facilitating 
the 
exercise  of  citizens'  rights  while  at 
the  same  time  ensuring  legal  clarity, 
a  fair  and  equitable  distribution  of 
the  financial  burden  among 
the 
institutions  of  the  Member  States 
involved 
administrative 
simplicity  and  enforceability  of  the 
rules. 

and 

to  ensure  legal  clarity  and  transparency 
on  the  distinctions  between  the  rights  of 
workers,  jobseekers  and  economically 
inactive  mobile  EU  citizens,  including 
the  extent  to  which  Member  States’ 
social  security  institutions  are  permitted 
to  limit  the  equal  treatment  principle  for 
economically inactive mobile EU citizens 
and  jobseekers  who  claim  certain  social 
benefits. 

6.7.5 Impacts of Policy Option 1c: Specific reference to Directive 2004/38/EC (SNCBs) 

Policy Option 1c:  Amendment of Article 70 of Regulation (EC) No 883/2004 to make reference to the 
limitations  in  Directive  2004/38/EC  in  the  context  of  benefits  that  provide  a  minimum  subsistence 
income 

Social impact 

Clarification  

+ 

The  codification  of  existing  case-law  would  clarify  the 
rights of EU mobile citizens and would facilitate citizens to 
make  an  informed  choice  when  exercising  their  rights  to 
move to another Member State. In particular, it is specified 
that  in  accordance  with  the  jurisprudence  of  the  CJEU, 
derogation of the principle of equal treatment solely applies 
to SNCBs providing for a minimum level of subsistence as 
listed  in  Annex  X  of  the  Regulation,  thereby  achieving  a 
greater level of legal certainty. 

Simplification 

+/- 

As per option 1a, the codification of existing case-law would 
also  simplify  the  process  whereby  EU  mobile  citizens  and 
national  institutions  could  verify  their  respective  rights  and 
obligations.  The  precise  nature  of  the  codification  ensures 
the  scope  of  application  is  clear,  however,  it  is  possible 
further amendments may be necessary if the case law of the 
CJEU  continues  to  evolve  leading  to  trade-offs  between 
clarity and simplicity. 

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Protection of Rights 

+ 

As Option 1a and for the same reasons. 

Financial impact 

0 

There will be no direct impact on Member States' budgets as 
this measure simply reflects codification of the case-law of 
the Court. 

Impacts on fundamental rights 

0 

Mere codification of the case-law of the Court. Any impact 
on  fundamental  rights  already  exists  in  EU  law  –  the 
amendment to the Regulation will merely reflect this.  

Other impacts 

Regulatory costs 

+/0 

Risk of fraud and abuse 

Fair  burden  sharing  between 
Member States 

Coherence 
Specific 
Objectives: 

with 

and 

wider 

General, 
EU 

+ 

0 

+ 

Costs  related  to  lack  of  clarity/transparency/legal  certainty 
(for  instance  litigation  costs,  legal  advice,  elaboration  of 
administrative  guidance)  for  both  citizens  and  public 
authorities  could  be  reduced.  However,  as  this  option  sets 
out  the  limits  on  the  equal  treatment  principle  only  in  very 
general  terms,  it  is  likely  that  some  litigation  on  the 
relationship between the Regulation and the Directive would 
continue.  Public  administrations  may  additionally  decide 
themselves 
improve  clarity  by  producing  detailed 
guidance at national level (although such measures will be at 
their own discretion).  

to 

As with Option 1a 

As with Option 1a 

As with Option 1a although it is foreseen that if the case law 
of  the  CJEU  continues  to  evolve  there  may  be  trade-offs 
between clarity and simplicity. 

Continue  the  modernisation  of  the 
EU  Social  Security  Coordination 
Rules  by  further  facilitating 
the 
exercise  of  citizens'  rights  while  at 
the  same  time  ensuring  legal  clarity, 
a  fair  and  equitable  distribution  of 
the  financial  burden  among 
the 
institutions  of  the  Member  States 
involved 
administrative 
simplicity  and  enforceability  of  the 
rules. 

and 

to  ensure  legal  clarity  and  transparency 
on  the  distinctions  between  the  rights  of 
workers,  jobseekers  and  economically 
inactive  mobile  EU  citizens,  including 
the  extent  to  which  Member  States’ 
social  security  institutions  are  permitted 
to  limit  the  equal  treatment  principle  for 
economically inactive mobile EU citizens 
and  jobseekers  who  claim  certain  social 

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benefits. 

Impacts of Policy Option 2: Remove SNCBs providing for minimum level of 

6.7.6 
subsistence from scope of Regulation (EC) no 883/2004 

[Policy Option 2:  Remove SNCBs providing subsistence income from Regulation (EC) No 883/2004 

Social impact 

Clarification  

++ 

This  option  achieves  clarity  by  clearly  delineating  between 
social  security  rights  which  fall  within  the  scope  of 
Regulation  (EC)  No  883/2004  in  respect  of  which  citizens 
retain a full right to equal treatment and those to which the 
limitations  in  Directive  2004/38/EC  apply.  This  would 
facilitate  citizens  to  make  an  informed  choice  when 
exercising their rights to move to another Member State.  

Simplification 

++ 

Protection of Rights 

- 

Financial impact 

0 

Impacts on fundamental rights 

0 

Other impacts 

Regulatory costs 

-- 

305 Article 76(7) of Regulation (EC) No 883/2004. 
306 Article 5 of Regulation (EC) No 883/2004. 

This  option  also  achieves  simplicity  by  separating  the 
material  scope  of  Regulation  (EC)  No  883/2004  from 
Directive 2004/38/EC apply in a manner which means both 
citizens  and  institutions  only  need  to  refer  to  one  legal 
instrument at a time. 

A significant disadvantage of this option is that some of the 
rules  in  Regulation  (EC)  No  883/2004,  which  can  be 
beneficial for mobile EU citizens (e.g. for example, the rule 
that  social  security  institutions  may  not  reject  documents 
submitted  to  them  in  an  official  language  of  another 
Member  State;305  or  the  rule  of  assimilation  of  facts  which 
requires Member States to take into account facts or events 
occurring  in  any  Member  States  as  though  they  had  taken 
place  on  their  own  territory.306),  would  no  longer  apply.  It 
seems  likely  that  it  may  become  more  difficult  for  mobile 
EU citizens to claim such benefits in other Member States. 
Some  EU  citizens  could  be  discouraged  from  exercising 
their free movement rights as a result. 

There will be no direct impact on Member States' budgets as 
this measure simply reflects codification of the case-law of 
the Court. 

Mere codification of the case-law of the Court. Any impact 
on  fundamental  rights  already  exists  in  EU  law  –  the 
guidelines will merely reflect this. 

While  there  may  be  some  savings  for  both  citizens  and 
public authorities related to lack of clarity/transparency/legal 
certainty(for 
legal  advice, 
elaboration  of  administrative  guidance)  There  would  be 

litigation  costs, 

instance 

EN 

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some  noticeable  administrative  costs  for  Member  State 
social security institutions arising as a result of (a) changes 
to  procedures  and  (b)  being  unable  to  benefit  from  the 
existing  cooperation  procedures  for  information  exchange 
and  verification  provided  under 
the  Regulation,  (for 
example,  to  check with  institutions  in  other  Member  States 
the  validity  of  documents  or  accuracy  of  facts  supplied  to 
them).307  In  addition,  institutions  would  not  be  able  to 
benefit  from  the  efficiencies  of  the  EESSI  electronic 
information  exchange  platform  due  to  be  launched  by  the 
end  of  2016  with  full  implementation  by  2018.  As 
institutions  may  be 
to  separately  establish 
mechanisms  for  information  exchange  to  ensure  rights  and 
obligations are respected. 

required 

There may be an increased risk of fraud and abuse because 
Member  States  would  not  be  able  to  benefit  from  the 
existing  cooperation  procedures  for  information  exchange 
and verification provided under the Regulation, if this option 
were followed. In addition, the provisions in the Regulation 
concerning recovery of benefits that are paid in error could 
also not be used.308   

As with Option 1a. 

As with Option 1a although it is foreseen that there may be 
trade-offs  between  clarity  and  simplicity  of  establishing  a 
clear separation between Regulation (EC) No 883/2004 and 
Directive  2004/38/EC  and  the  protection  of  rights  for 
citizens  and  regulatory  burden/risk  of  fraud  and  error  for 
national  institutions  arising  from  the  loss  of  application  of 
the Regulation to SNCBs.  

Risk of fraud and abuse 

- 

0 

- 

Fair  burden  sharing  between 
Member States 

Coherence 
Specific 
Objectives: 

with 

and 

wider 

General, 
EU 

Continue  the  modernisation  of  the 
EU  Social  Security  Coordination 
Rules  by  further  facilitating 
the 
exercise  of  citizens'  rights  while  at 
the  same  time  ensuring  legal  clarity, 
a  fair  and  equitable  distribution  of 
the  financial  burden  among 
the 
institutions  of  the  Member  States 
involved 
administrative 
simplicity  and  enforceability  of  the 
rules. 

and 

to  ensure  legal  clarity  and  transparency 
on  the  distinctions  between  the  rights  of 
workers,  jobseekers  and  economically 
inactive  mobile  EU  citizens,  including 
the  extent  to  which  Member  States’ 
social  security  institutions  are  permitted 
to  limit  the  equal  treatment  principle  for 
economically inactive mobile EU citizens 
and  jobseekers  who  claim  certain  social 
benefits. 

6.7.7 

Impacts of Policy Option 3: Provide Administrative Guidance 

Policy Option 3:  Provide administrative guidance 

Social impact 

307 Article 5(3) of Regulation (EC) No 987/2009. 
308 Article 71 to 85 of Regulation (EC) No 987/2009. 

EN 

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Clarification  

+/0 

Guidance  could  provide  detailed  explanations  on  when 
limitations on the equal treatment principle could be applied 
and  circumscribe  closely  the  group  of  benefits  which  are 
affected  (namely  special  non-contributory  cash  benefits 
income).  Although 
providing  a  minimum  subsistence 
guidance is not legally binding it is more flexible and easier 
to update and modify and allows to better explain the legal 
rules  to  citizens.  However,  the  non  binding  character  of 
guidance limits its impact. 

Simplification 

Protection of Rights 

++ 

+/0 

Guidance may be provided in a range of accessible formats, 
giving precise guidance on specific scenarios which may be 
easier for citizens to understand than legal text. 

By  increasing  clarity  the  application  of  the  case  law  of  the 
CJEU,  legal  certainty  is  also  increased  thereby  facilitating 
greater  uniformity  in  application  by  Member  States  and 
facilitating the ability of citizens to enforce their rights. 

Financial impact 

0 

Impacts on fundamental rights 

0 

There will be no direct impact on Member States' budgets as 
this measure simply reflects codification of the case-law of 
the Court. 

Mere codification of the case-law of the Court. Any impact 
on  fundamental  rights  already  exists  in  EU  law  –  the 
guidelines will merely reflect this. 

Other impacts 

Regulatory costs 

+/0 

+ 

0 

+ 

Risk of fraud and abuse 

Fair  burden  sharing  between 
Member States 

Coherence 
Specific 
Objectives: 

with 

and 

wider 

General, 
EU 

Continue  the  modernisation  of  the 
EU  Social  Security  Coordination 
Rules  by  further  facilitating 
the 
exercise  of  citizens'  rights  while  at 
the  same  time  ensuring  legal  clarity, 
a  fair  and  equitable  distribution  of 
the  financial  burden  among 
the 
institutions  of  the  Member  States 

Costs  related  to  lack  of  clarity/transparency  (for  instance 
litigation  costs,  legal  advice)  for  both  citizens  and  public 
authorities  could  be  reduced.  It  is  anticipated  that  these 
savings  may  be  achieved  sooner  in  the  light  of  the  relative 
ease of implementing guidance compared with a legislative 
measure.  But  given  the  non  binding  character  of  guidance 
this  measure  in  isolation  may  not  entirely  reduce  litigation 
risk.  

As with Option 1a although the benefits are anticipated to be 
greater  in  light  of  the  increased  transparency  of  the 
guidance. 

As with Option 1a. 

As with Option 1a although it is foreseen that there may be 
trade-offs  between  clarity  and  simplicity  of  establishing 
clear and accessible guidance and the non-binding nature of 
guidance  which  may  not  be  the  most  effective  means  of 
achieving legal certainty or reducing litigation risk. 

EN 

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and 

involved 
administrative 
simplicity  and  enforceability  of  the 
rules. 

to  ensure  legal  clarity  and  transparency 
on  the  distinctions  between  the  rights  of 
workers,  jobseekers  and  economically 
inactive  mobile  EU  citizens,  including 
the  extent  to  which  Member  States’ 
social  security  institutions  are  permitted 
to  limit  the  equal  treatment  principle  for 
economically inactive mobile EU citizens 
and  jobseekers  who  claim  certain  social 
benefits. 

6.8. 

Conclusions  

Based on the above table, the following preliminary conclusions can be drawn. 

The  baseline  scenario  is  the  most  straightforward  to  implement.  However,  this  option  does  not 
however, address the objective of ensuring legal clarity and transparency nor the wider EU objective 
of supporting fair mobility. 

Option 1a) introduces legal clarity for economically inactive mobile EU citizens and jobseekers and 
the  persons/institutions  involved  in  the  enforcement  of  the  legislation.  This  option  addresses  the 
objective  identified  and  at  the  same  time  provides  flexibility  if  the  case-law  on  the  relationship 
between the Directive and the Regulation evolves. This option may be considered coherent with the 
wider  EU  objective  of  supporting  fair  mobility  and  reflects  the  case-law  of  the  CJEU.  However,  it 
also means that full clarity on the relationship between the Regulation and the Directive will have to 
await further jurisprudence from the CJEU. 

Option 1b) introduces legal clarity for economically inactive mobile EU citizens and jobseekers and 
the  persons/institutions  involved  in  the  enforcement  of  the  legislation.  This  option  addresses  the 
objective  identified  and  at  the  same  time  provides  flexibility  if  the  case-law  on  the  relationship 
between  the  Directive  and  the  Regulation  evolves.  The  extension  of  the  limitations  to  non-
contributory family benefits, long-term care benefits and sickness benefits is anticipated to result in a 
total cost saving estimated at €37.7 and 79.2 millions in relation to family benefits; €31.5 millions in 
relation to Long-term care benefits and €185.1 millions in relation to sickness benefits for the EU-28 
Member  States  compared  with  the  baseline  (although  it  is  also  noted  there  would  be  a  potential 
negative impact on the social and fundamental rights of economically inactive EU mobile citizens and 
jobseekers). This option may be considered coherent with the wider EU objective of supporting fair 
mobility  (fair  for  both  mobile  citizens  and  tax-payers  in  the  State  of  destination)  but  less  coherent 
with  objectives  to  promote  a  social  agenda  in  particular  in  relation  to  mobility  for  more  vulnerable 
groups within the Union. 

Option  1c)  may  be  considered  to  provide  greater  legal  certainty.  This  option  also  addresses  the 
objective identified but if the case-law on the relationship between the Directive and the Regulation 
evolves,  further  legislative  changes  might  be  necessary  meaning  this  may  not  be  the  most  efficient 
method of achieving the objective nor the wider EU objective of supporting fair mobility. 

Option 2 would not contribute to the attainment of the objective identified. On the contrary, it presents 
a  major  draw-back  since  several  beneficial  rules  of  the  Regulation  would  no  longer  apply.  This  is 
therefore considered neither an efficient or effective means of addressing the problems identified nor 
the wider EU objective of supporting fair mobility or objectives to promote a social agenda. 

Option 3, on its own, would be less effective and less efficient in achieving the identified objective 
since  the  Regulation  would  not  contain  all  the  elements  necessary  for  its  direct  applicability  to  the 
detriment of both citizens and the persons/institutions involved in its enforcement. 

EN 

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7.  Family Benefits 

7.1. 

Current Coordination Rules for Family Benefits 

Family benefits are all benefits in kind or cash intended to help to meet family expenses which arise 
from  the  obligation  to  maintain  children.309  This  covers  a  wide  diversity  of  social  security  benefits 
including not only the traditional "child benefits" but also other types of benefits for families e.g. to 
encourage educational attainment, labour market participation by parents or to replace income during 
child-raising periods. 

The principle of exportability contained within the EU social security coordination rules means that 
when  the  child  of  a  worker  resides  in  another  State,  the  worker  can  export  the  full  amount  of  the 
family  benefits  received  from  the  State  of  activity  to  the  State  where  the  child  resides:  in  fact,  a 
mobile citizen cannot be denied access to family benefits in cash under the national legislation of a 
Member  State  solely  on  grounds  that  the  person  concerned  and/or  his/her  family  reside  in  another 
Member State. The regulation effectively overrules any residency requirement in national legislation 
regarding  such  cash  benefits  and  doesn't  allow  cash  benefits  to  be  reduced,  amended,  suspended, 
withdrawn or confiscated.310  

The  EU  social  security  rules  provide  that  primary  responsibility for  payment  of  family  benefits  lies 
with the Member State of economic activity, on the assumption that the country of employment will 
usually  be  the  country  where  a  mobile  EU  citizen  pays  social  security  contributions  and  taxes. 
However, in the field of family benefits, it is very common that families in a cross-border situation to 
have  overlapping  entitlements  to  family  benefits.  This  is  because  a  child  normally  has  two  parents, 
who may each have independent entitlements to family benefits from different States. To address this 
issue,  the  coordination  rules  provide  specific  anti-overlapping  rules  which  establish  an  order  of 
priority  for  the  Member  States  to  make  payments.311    Under  these  rules,  the  primary  competent 
Member State will pay its family benefits in full, but entitlement to family benefits in cash under the 
legislation of the Member State with secondary competence will be suspended up to the amount of the 
benefits  due  under  the  legislation  of  the  State  that  takes  priority  (usually  the  Member  State  of 
Employment or in the case of two economically active parents, the place of residence of the child). 
The current rules also provide that in the event of overlapping entitlements the family concerned will 
always receive an amount equivalent to the highest level of benefits available.312 Consequently, if the 
amount  of  family  benefit  provided  for  by  the  legislation  of  the  former  State  is  higher  than  that 
provided in accordance with the legislation of the other State; the former State will pay a supplement 
or "top up" corresponding to the difference between the two benefits.  

A  further  important  principle  in  the  rules  on  family  benefit  coordination  is  that  family  benefits  are 
considered  benefits  for  the  family  as  a  whole.  313    This  means  that  a  family  member  may  have  a 
derived right to claim such benefits even if they reside and work in another Member State and have no 
personal connection to the social security system of the Member State awarding the benefit.314  

The current rules include an important safeguard for Member States against the risk of abuse or undue 
burden on national social security systems. There is no obligation for a country to export a differential 

309 Article 1(z) Regulation (EC) No 883/2004 . The definition expressly excludes advances of maintenance payments and special childbirth 
and adoption allowances mentioned in Annex 1 of Regulation (EC) No 883/2004. 
310 Article 7 of Regulation (EC) No 883/2004. The current rules do not provide for any such derogation in relation to family benefits while 
the CJEU has accepted derogation from the principle of export in relation to special non-contributory benefits and unemployment benefits 
(Snares, C-20/96, EU:C:1997:518) although such derogation must be construed narrowly. Article 48 TFEU on the minimum content of the 
coordination Regulations explicitly mentions two principles: aggregation and exportability of the acquired rights to facilitate the exercise of 
freedom of movement. For more detailed overview of current EU legal framework, see Annex XXII. 
311 The priority rule is defined in Article 68 of Regulation (EC) no 883/2004. See Annex XXII for details. 
312 The Court has been explicit in its case law by concluding that "the Regulation cannot be applied in such a way as to deprive the worker, 
by  substituting  the  benefits  provided  by  one  Member  State  for  the  benefits  payable  by  another  Member  State,  of  the  most  favourable 
benefits" (Case C-73/79, Laterza). 
313 Joined cases C-245/94 and C-312/94 Hoever and Zachow.  
314 See for example, Article 68A of Regulation (EC) no 883/2004 and Article 60(1) of Regulation (EC) 987/2009 supporting the rights of a 

parent or person in loco parentis to assert derived rights. 

EN 

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supplement where a right to family benefit is derived solely on the basis of residence of an EU mobile 
citizen.315  

Based on data collected from 19 Reporting Member States and EFTA States in the survey on export 
of family benefits,316 a total export of € 983 million in family benefits was declared for 2013, which 
includes  export  of  child  benefits  (an  important  sub-category  of  family  benefits)  to  324  thousand 
households  or  506  thousand  children  living  in  another  Member  State.  This  is  equal  to  a  total 
expenditure  of  €  942  million.  Benefit  export  amounted  to  0.8%  of  EU-28  expenditure  on  child  and 
family  allowances.317  On  average  1%  of  child  benefits  are  being  exported  abroad,  which  represents 
1.6% of total public spending on child benefits.318   

7.2. 

Problems with the export of family benefits and drivers behind them 

7.2.1.  The  lack  of  correlation  between  the  amount  of  exported  benefits  and  the  costs  incurred  in 

raising a child in the State of residence of the child is perceived as unfair 

The family benefit systems differ  considerably in  terms of  eligibility criteria, design and generosity 
across the EU.319 These differences reflect the diversity in the economic and social context between 
Member  States,  which  to  some  extent  have  been  exacerbated  by  austerity  measures  adopted  in 
response to the recent economic crisis.320 For example, in Luxembourg, a family with one child might 
expect to receive child benefit at the rate of €185 per month, by contrast in Bulgaria, the child benefit 

315 Article 68(2) Regulation (EC) No 883/2004 . In the case of two economically inactive parents, the Member State of residence of the child 
would have primary competence to pay family benefits in accordance with its national legislation. 
316 Annex XI 
317 In 2012, total family and child allowance expenditure was € 126,043 million. (ESSPROSS, Pacolet 2015) 
318 Table 11, Annex XI (Data based on 16 reporting Member States) 
319 For more details, see section 3, p. 156-169 in Annex XXI. 
320 By mid-2010, austerity measures affecting family policy had either been adopted or announced in 11 Member States (Czech Republic, 
Denmark, Estonia, Germany, Hungary, Ireland, Italy, Luxembourg, the Netherlands, Spain and the United Kingdom OECD (2011), Doing 
Better for Families. 

EN 

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would  be  €18  per  month.  321  This  means  that  a  worker  in  Luxembourg  whose  family  resides  in 
Bulgaria may be able to export €185 per month to Bulgaria to support his or her family; conversely a 
worker  in  Bulgaria  whose  family  resides  in  Luxembourg  would  only  be  entitled  to  export  €18  per 
month.322 A worker based in Luxembourg may be entitled to family benefits that represent 190% of 
the average earnings of a one-earner married couple with two children in Bulgaria, while on average 
child benefits equal to 10% of the net earnings of household in EU-28/EFTA.323  

Furthermore,  there  is  a  perceived  unfairness  of  the  system  as  in  accordance  with  the  statutory 
definition of family benefits as "all benefits in kind or cash intended to meet family expenses,"324 the 
primary  objective  of  such  benefits  is  to  help  to  meet  the  additional  expenses  which  arise  from  the 
obligation  to  maintain  children  (e.g.  additional  or  special  nutrition,  nappies,  prams,  school  books, 
childcare,  etc.).  Those  expenses  will  often  be  linked  to  the  actual  costs  of  goods  or  services  in  the 
place of residence of the child, which means that the level of such expenses can differ significantly 
from  one  Member  State  to  another.  Viewed  from  this  perspective,  recipients  of  exported  family 
benefits may be in a privileged position compared to nationals because exported benefits may provide 
a comparatively greater purchasing power in the country of residence.  

Such  perceptions  of  unfairness  are  sustained  (reinforced)  both  by  the  non-contributory  nature  of 
family benefits that are predominantly financed wholly or partially through general taxation325 and the 
fact  that  in  the  majority  of  Member  States  entitlement  to  family  benefits  is  on  the  basis  of  legal 
residence  whereas  under  the  EU  social  security  rules  priority  is  awarded  to  the  State  of  economic 
activity.326  This  results  in  a  tension  between  the  EU  social  security  rules  and  principles  of  national 
legislation  and  leads  to  the  perception  that  Member  States  of  residence  are  abdicating  their  social 
security  responsibilities  in  relation  to  children  resident  within  their  territory  to  another  Member 
State.327 As a consequence of this perceived unfairness, there is a risk of negative attitudes towards 
migration  amongst  the  general  population,  as  are  already  observed  in  the  public  debate  in  some 
Member  States,  which  entails  a  risk  that  public  and  political  support  for  the  EU  social  security 
coordination rules may be undermined with a subsequent negative impact on labour mobility. There is 
also a risk of unilateral imposition of restrictive measures by Member States. For example, there have 
been a number of examples of public criticism of the current EU rules on export of family benefits 
and counter-proposals by senior politicians challenging the concept of export for family benefits.328  

This political discourse may be perceived as both a catalyst and a reaction to sentiments expressed by 
national media outlets and public opinion in some329 (although by no means all330) Member States and 

321 In 2014, Luxembourg had a GDP per capita in PPS of more than two and a half times above the EU-28 average while Bulgaria had it less 

than half the EU-28 . http://ec.europa.eu/eurostat/tgm/table.do?tab=table&init=1&language=en&pcode=tec00114&plugin=1 

322 Family living in Luxembourg may receive a differential supplement from Luxembourg up to the level of the national family benefits. For 
the definition of differential supplement see the glossary in Annex XXIII. 
323 Annex XI. 
324 Article 1(z) Regulation (EC) No 883/2004 . The definition expressly excludes advances of maintenance payments and special childbirth 
and adoption allowances mentioned in Annex 1 of Regulation (EC) No 883/2004. 
325  16  Member  States,  finance  family  benefits  exclusively  through  general  taxation  FreSsco,  The  relationship  between  social  security 
coordination and taxation law, 2014. 
326 The priority for social security competence accorded to the Member State of Work is a consistent principle across the EU social security 
coordination rules for both contribution and non-contribution based social security benefits based on the economic logic that the worker 
usually pays taxes and contributions in the State of employment (Article 11(3) Regulation (EC) no 883/2004). 

327  A  member  state  of  residence  will  only  be  obliged  to  pay  a  differential  supplement  if  the  level  of  family  benefits  under  its  national 
legislation is higher than that available from the Member State of Work. For the definition of differential supplement see the glossary in 
Annex XXIII. 

328 Statements by the Austrian Foreign Minister Ziarul Financiar: "The Austrians control Romania's oil, banks, insurance sector and forests, 
..." page: 3 info: by Pâslaru Sorin date: Monday, June 22, 2015; Prime Minister of the United Kingdom's speech at JCB, Staffordshire. It 
includes  proposals  made  as  Leader  of  the  Conservative  Party,  28  November  2014  https://www.gov.uk/government/speeches/jcb-
staffordshire-prime-ministers-speech. 
329  Berlingske  Tidende:  "Danskerne  vil  begrænse  vandrende  arbejdstageres  adgang  til  velfærdsgoder..."  date:  Saturday,  June  6,  2015  In 
Denmark, 83% of the respondents in a new survey say that they agree that foreigners should only receive child benefits if their children are 
living in the country where their parents work. 
330 . Waterfield, ‘Poland attacks David Cameron plan to ban Polish and EU migrants from claiming child benefit’, The Telegraph, 6 January 
2014,  available  at  http://www.telegraph.co.uk/news/worldnews/europe/poland/10553020/Poland-attacks-David-Cameron-plan-to-ban-
Polish-and-EU-migrants-from-claiming-child-benefit.html  (last  accessed  17  March  2015).  He  argued that  Polish  people  contributed  about 
double the amount to the British economy than they withdrew in benefits and that in the long run the United Kingdom is receiving the fiscal 

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is  in  spite  of  studies331  which  consistently  show  both  support  for332  and  the  positive  effect  of  free 
movement of workers: mobile EU workers make a positive contribution to the mix of skills, fill labour 
shortages,  increase  the  GDP,  and  tend  to  make  a  net  positive  contribution  to  the  national  budget 
(including welfare systems). In addition the evidence demonstrates that  mobile workers use welfare 
benefits  no  more  intensively  than  the  host  country's  nationals.333  Further  two-thirds  of  Europeans 
believe  that  legal  immigrants  should  have  the  same  rights  as  national  citizens.334  This  belief  is  also 
reflected in relation to specific studies on equal rights in the field of welfare and social protection.335 

Underneath the heated political discourse, the situation is more complex. It is to be noted that despite 
the  widely  held  view  that  family  benefits  correlate  to  the  social  and  economic  environment  of  the 
competent  Member  State,  the  level  of  family  benefits  are  not  directly  linked  to  the  minimum  or 
average  wage,  subsistence  level  or  living  costs  in  any  Member  State.336  Moreover,  despite  the 
criticism  that  the  general  model  for  determining  competence  under  the  EU  social  security  rules  is 
inappropriate for family benefits, it is significant that in 12 out of 28 Member States, family benefits 
are financed either through a combination of general taxation and employer/employee contributions, 
or are exclusively contribution-based.337 

While  some  critics  believe  the  current  model  for  coordinating  family  benefits  leads  to  an  unfair 
distribution of burden between the Member State of Work and the Member State of Residence, this 
does not acknowledge either the fact that a mobile citizen will normally pay taxes and social security 
contributions in the State of Work. Nor does such criticism acknowledge the financial contribution of 
the Member State of residence in providing and financing family benefits in kind (such as subsidized 
child-care  services),338  or  benefits  outside  the  scope  of  the  coordination  rules,  such  as  advances  to 
maintenance payments and to special childbirth and adoption allowance.339 In addition, while family 
expenses may vary according to the actual costs of goods or services in the place of residence of the 
child,  families  in  a  cross-border  situation  may  also  face  increased  expenses  (e.g.  travel  and 
communication  costs  to  maintain  contact  or  additional  child-care  costs  for  the  parent  with  primary 
caring  responsibilities  due  to  the  absence  of  the  other  parent).  There  may  also  be  further  socio-
economic consequences of family separation for example, the impact on the level and extent of labour 
market  participation  that  the  parent  with  primary  caring  responsibilities  may  engage  in  and  the 
psychological and emotional consequences for the child.340  

7.2.2.  Risk  that  the  anti-accumulation  rules  reduce  incentives  for  both  parents  to  remain 
economically  active  and  share  child-raising  responsibilities  and  difficulties  in  awarding 
"parent-centred" benefits on the basis of derived rights 

contribution of migrants’ work, without paying for the education and training that enables them to work. Ziarul Financiar: "The Austrians 
control Romania's oil, banks, insurance sector and forests, ..." page: 3 info: by Pâslaru Sorin date: Monday, June 22, 2015. 
331 See review of studies in European Commission, ESDE 2011 (chapter 6); EPC (2013). 
332 Eurobarometer 83, (Spring 2015) “the free movement of people, goods and services within the EU” was regarded as the most positive 
result of the EU by 57%, ahead of peace (55%) among member states. Both of these items have always been mentioned by at least a half of 
Europeans since this question was first asked. 
333  See  OECD's  International  Migration  Outlook  2013,  the  Centre  for  Research  and  Analysis  of  Migration  study  on  Assessing  the  Fiscal 
Costs and Benefits of A8 Migration to the UK and the study by the Centre for European Reform and ICF GHK in association with Milieu 
Ltd Fact finding analysis on the impact on Member States’ social security systems of the entitlements of non-active intra-EU migrants to 
special non-contributory cash benefits and healthcare granted on the basis of residence. 
334 Special Eurobarometer 380 "Awareness of home affairs", December 2011. 
335 Jurgen Gerhards, Holger Lengfeld, European Citizenship and Social Integration in the European Union, (Routledge 2015). 
336  For  example,  child  allowances  in  both  Luxembourg  and  Sweden  are  awarded  on  a  flat  rate  not  related  to  living  costs,  average  or 
minimum  income  and  regardless  of  the  relative  income  level  of  the  recipients.  Similarly,  Member  States  don't  adjust  its  level  of  family 
benefits to reflect different costs of living within the relevant territory (even where significant variations exist). There may be indirect links 
to subsistence or minimum wage in relation to certain means-tested family benefits in Belgium, Bulgaria, Croatia and Slovenia. In addition 
indirect links to cost of living in the Member State concerned is apparent from indexation rules in Austria, Belgium and Slovenia (Annex 
VI, p.22-25.). 
337 FreSsco, The relationship between social security coordination and taxation law, 2014. 
338 Member State expenditure on family benefits in kind typically ranges between 0.2 and 1.7 percent of GDP . Annex XIII: Table 3. 
339 Article 1(z) Regulation (EC) no 883/2004. 
340 http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2432946 http://opus.bath.ac.uk/46410/. 

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The EU social security coordination rules contain a wide definition of family benefits, which include 
child-raising allowances.341 A child-raising allowance is a benefit intended to cover wages/income lost 
when a parent stays home from work to take care of the child and may be calculated by reference to 
salary or professional income or may be flat-rate.  

It  is  a  core  principle  of  the  EU  social  security  coordination  rules  that  two  Member  States  are  not 
simultaneously  obliged  to  pay  social  security  benefits  for  the  same  purpose  in  respect  of  the  same 
period (anti-accumulation principle). This is also the basis of the priority rules for overlapping family 
benefits  explained  at  section  7.1  above.  However,  applying  the  anti-accumulation  rules  to  child-
raising allowances is perceived as unfair by some citizens because in contrast to other family benefits 
a child-raising allowance is intended to cover wages lost when a parent stays home from work to take 
care  of  the  child.  It  is  therefore  perceived  as  a  sum  that  parent  has  "earned"  and  which  should  be 
awarded without deduction.342  

Example: David and Marie live with their child in Member State A. David is working in Member State A and 
Marie is a frontier worker in Member State B. They both work part-time and share child-care responsibilities. 
Member State A has a child raising allowance calculated with reference to salary while Member State B has a 
flat-rate child-raising allowance regardless of salary or income. David is entitled to €75 per week based on his 
salary in Member State A, and Marie is entitled to €25 per week. Member State A is primarily competent to pay 
child allowance because of child's residence and David's work. Member State B is the secondary competent and 
obliged  to  pay  only  the  differential  supplement  (see  Annex  XXII  for  details).  In  calculating  differential 
supplement,  Member  State  B  takes  into  account  the  benefits  paid  in  Member  State  A  in  line  with  the  anti-
accumulation rules. The level of allowance in Member State A (€75) is higher than the amount in Member State 
B (€25) and therefore Member State B does not pay Marie anything during periods when she takes leave from 
work  to  take  care  of  her  child.  The  family  gets  €75  but  it  would  get  €100  if  the  child-allowance  based  on 
individual salary would be treated as individual right and not as an entitlement for the entire family. 

Some critics also complain that the application of the anti-accumulation rules undermines the policy 
objective  of  promoting  greater  gender  equality  by  encouraging  parents  to  share  child-raising 
responsibilities as the potential loss in household income that results from the anti-overlapping rules 
acts as a deterrent against both parents claiming child-raising allowances at the same time.343 A driver 
for  these  challenges  is  the  social  security  trend  among  Member  States  to  promote  parents’  (in 
particular  mothers’)  participation  in  the  workplace.  Reconciliation  of  work  life  balance  and  gender 
balance  is  an  objective  for  family  policy  in  24  Member  States,344  while  22  Member  States  have  a 
benefit intended to replace income during child-raising periods.345  

A related problem with the application of the current coordination rules to child-raising allowances is 
that  these  are  generally  considered  "parent-centred"  rights,  intended  to  protect  the  individual  parent 
concerned. However, under EU law, family benefits are deemed benefits for the family as a whole. 
This means that either parent may have a derived right to claim such benefits even if such parent is 
residing and working in another Member State and has no personal connection to the social security 
system of the Member State awarding the benefit.346 Some national authorities complain that there are 
administrative and practical challenges for their institutions when a claim is made as a derived right 
by  a  spouse  or  partner  as  it  is  difficult  to  determine  if  national  conditions  are  satisfied.  These 
complexities are exacerbated for salary-related child raising allowances where a claim is made by a 

341 Joined cases C-245/94 and C-312/94 Hoever and Zachow. 
342 Annex VI p18 and 26 in relation to Sweden. 
343  For  critique  of  the  application  of  the  anti-accumulation  rules to  salary-related  child-raising  allowances  see  Sakslin,  M.  (2000)  ‘Social 
Security  Co-ordination  –  Adapting  to  Change’,  European  Journal  of  Social  Security,  2(2),  p184  and  Holm,  E  "  Parental  Benefits  in  the 
Coordination Regulation: Where do they fit in the Swedish Example" European Journal of Social Security, Volume 16 (2014), No. 2: p136 
344 The Council of Europe Family Policy Database. 
345Annex XXV p 7. 
346 For example, David works in country A, while Marie with a child lives and works in country B. Member State A has a salary-related 
child allowance. David can share part of his parental related benefits entitlements with Marie without any loss to the household income 
providing that Marie fulfils the conditions under A's national law, i.e. she has taken leave from work to take care of the child.  

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family  member  who  does  not  have  earnings  in  the  Member  State  awarding  the  benefit.347 
Consequently, some Member States refuse to coordinate such benefits as family benefits under the EU 
Coordination  rules,  instead  classifying  them  as  maternity  or  equivalent  paternity  allowances  in  a 
manner that circumvents both the anti-accumulation rules and the application of derived rights. The 
2012  Nordic  Convention348  excludes  benefits  intended  to  compensate  for  income  loss  from 
professional activity when calculating differential supplements for family benefits.349 In other cases, 
Member States restrict entitlement to this type of benefit exclusively to a person who is insured under 
the national social security insurance.350 Consequently, notwithstanding enforcement action taken by 
the Commission, 351 very few Member States are currently fully complying with EU law.352  

The  consequence  of  such  divergent  approaches  is  inconsistent  treatment  of  families  and  uneven 
distribution  of  burden  between  Member  States.  The  other  secondary  competent  Member  States  are 
unable to "off-set" such awards when calculating the differential supplement in a manner which may 
be seen as unfair, if those Member States categorize similar benefits according to the social security 
rules as family benefits.353 Likewise, there may be increased accumulation of benefits by families and 
increased risk of infringement proceedings.  

7.2.3. Delays in processing claims for family benefits 

Situations  of  overlapping  entitlements  are  very  common  when  insured  parents  with  dependent 
children  live  and  work  in  different  Member  States.  The  priority  rules  define  the  process  in 
establishing the primary and secondary competent states and the way to calculate level of benefits and 
differential supplements.354 This requires a number of exchanges of information between the Member 
States and increases time needed to process the claims for the export of family benefits.355 In addition, 
a number of sociological changes (that are outside the scope of this initiative such as legalisation of 
same-sex  marriage,  increased  instances  of  lone  parents,  divorce,  family  breakdown  and  remarriage) 

347 See results of FreSsco mapping exercise Annex VI p27. 
348 A multilateral convention based on Regulation (EC) No 883/2004 between Sweden, Denmark, Finland, Norway and Iceland. Iceland and 
Norway apply Regulations (EC) Nos 883/2004 and 987/2009 pursuant to the 1994 European Economic Area Agreement. According to the 
Article_8.2 of Regulation (EC) No 883/2004, such agreements shall be based on the principles of the Regulation and in keeping with the 
spirit thereof. 
349 Article 11 of the Nordic Convention 2012.  
350  For  instance,  in  Austria  entitlement  to  the  income  replacement  scheme  requires  (among  others)  that  the  person  concerned  has  been 
employed for a minimum period of six months before childbirth under the Austrian social security insurance. Thus, a person who resides in 
Austria but is working in another Member State and is therefore subject to the social security scheme of that Member State, is not entitled to 
income replacing cash childcare benefits in Austria. Similarly in Belgium, in order to qualify under the ‘professional’ scheme, work has to 
be carried out in Belgium. For more, see Annex VI (p. 37).  
351 European Commission, June Infringement Package: Key Decisions “Commission requests SWEDEN to comply with EU coordination 
rules in relation to its parental allowance” 18 June 2015 http://europa.eu/rapid/press-release_MEMO-15-5162_en.htm 
352 Only four of the seventeen Member States who have salary-related child-raising allowances recognise claims based on derived rights See 
also the FreSsco report by J. De Coninck, ‘Reply to an ad hoc request for comparative analysis of salary-related child-raising allowances', 
FreSsco, European Commission, September 2015. Annex XXV, p14. 
353  Member  States  where  parental  benefits  are  included  in  the  total  sum  of  family  benefits  will  have  higher  benefits,  and  are  more  often 
obliged  to  pay  supplements.  See  an  evaluation  made  by  the  Swedish  Social  Insurance  Agency  on  the  payment  of  family  benefits 
Försäkringskassan analyserar 2005:3 Utbetalning av familjeförmåner med stöd av EG-lagstiningen under 2004. p. 20 and Försäkringskassan 
analyserar 2007:10 Utbetalning av familjeförmåner med stöd av EG- lagstiftningen _ under 2006. p. 18. 
354  See  Annex  XXII  for  details.:  if  there  are  overlapping  entitlements  to  family  benefits  in  cash  (i.e.  entitlements  under  two  or  more 
legislations  in  respect  of  the  same  family  member  and  for  the  same  period)  on  different  bases,  the  order  of priority  is  as  follows:  firstly, 
rights available on the basis of an activity as an employed or self-employed person, secondly, rights available on the basis of receipt of a 
pension and finally, rights obtained on the basis of residence. In the case of rights available on the same basis, the Member State where the 
children  reside  shall  be  competent  by  priority  right  but  in  cases  where  a  right  exists  solely  on  the  basis  of  residence,  there  shall  be  no 
obligation  for  the  secondary  competent  Member  State  to  export  the  differential  supplement  in  respect  of  children  residing  in  another 
Member State . It should be noted, these rules apply to family benefits in cash, in the case where a child does not reside in the State which 
has primary competence, the State of residence of the child will usually be responsible for providing benefits in kind (subject to a family 
fulfilling conditions of entitlement). 
355  Exchanges  of  information  are  necessary  to  establish  relative  order  of  competence  depending  on  the  place  of  residence  and  economic 
status of both parents and subsequently to calculate the benefit to be awarded based on the family circumstances as a whole (in the case of 
the  secondary  competent  Member  State  this  will  entail  calculation  of  the  differential  supplement)  .  Such  calculations  may  be  subject  to 
periodic  adjustments  relating  to  changes  in  the  families  circumstances  or  changes  to  the  level  of  family  benefits  granted  by  the  other 
Member  State  .  Where  a  sum  has  been  awarded  to  the  family  on  a  provisional  basis  (pending  final  determination  of  competence  by  the 
Member  States  concerned),  there  may  be  a  need  for  additional  exchanges  and  other  administrative  tasks  to  arrange  recovery  of  the 
overpayment; likewise delays in communicating changes of circumstance may also result in the need to initiate recovery procedures.  

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have  increased  the  complexity  of  family  structures.356  These  new  patterns  of  family  formation,  and 
divergences  in  legislation between  the  Member  States  in  relation  to  legal  rights  for  different  family 
structures  have  increased  the  need  for  the  exchange  of  information  and  necessitate  in  many  cases 
sensitive and time-consuming investigations to establish entitlement. 
There  are  considerable  delays  in  processing  claims  in  the  field  of  export  of  family  benefits.357  For 
example,  data  from  the  Latvian  national  authorities  suggest  that  in  over  65%  of  cases  requests  for 
information to other Member State to establish primary competence take longer than two-months for a 
response  and  in  some  cases  even  more  than  eight  months.358  Your  Europe  report  a  number  of 
complaints  received  from  citizens  concerning  excessive  delays  in  processing  their  family  benefit 
claims or receiving payment of family benefits.359  

The driver for delays primarily relates to the investigations and subsequent exchange of information 
between  competent  institutions  in  the  field  of  export  of  family  benefits.  First,  there  is  no  common 
understanding between Member States as to the deadlines for responding to a request for information 
from  another  Member  State  as  the  EU  rules  only  oblige  to  exchange  the  information  "without 
delay".360  A  second  driver  is  the  inefficient  exchange  of  information  between  competent  national 
institutions. Pending the implementation of a pan-European Electronic Exchange for Social Security 
Information  (EESSI)361  it  is  permissible  for  institutions  to  exchange  information  via  paper  and 
electronic  means  in  a  variety  of  different  formats  in  a  manner  which  also  hinders  efficient 
exchange.362 

The  consequences  of  long  procedures  are  twofold.  The  families  concerned  have  to  wait  for  a  long 
time  before  they  receive  the  full  amount  of  benefit  they  are  entitled  to.  The  regulatory  costs  and 
burden  for  national  authorities  may  increase  in  circumstances  where  repeated  requests  need  to  be 
made  for  information  or  a  provisional  decision  on  calculation  on  benefits  transpires  to  be  incorrect 
necessitating time-consuming recovery or reimbursement procedures.363  

7.2.4.  Baseline scenario 

Export of family benefits 

The  number  of  EU  mobile  workers  has  increased  sharply  in  absolute  terms  over  the  last  decade, 
however in terms of the overall active population it has only gone up one percentage point (from 2.1% 
in 2005 to 3.3% in 2014).364  
On the basis of the demographic projections365 there is no reason to anticipate dramatic increases in 
the  expenditure  for  Member  States  in  the  field  of  family  benefits  while  the  increase  in  the  age-
dependency  ratio  may  place  greater  pressures  on  national  administrations  to  finance  such  benefits: 

356 Between 1965 and 2011, the crude marriage rate in the EU-28 declined by close to 50 % while crude divorce rate increased from 0.8 per 
1 000 persons in 1965 to 2.0. Further, the rate of births outside marriage has increased . In the EU-28 as a whole, some 40 % of children 
were born outside marriage in 2012. Eurostat, Marriage and Divorce Statistics, June 2015. 
357 The FreSsco mapping exercise revealed administrative problems and delays in all participating Member States, Annex VI , p.16-17  
358 Note presented by Latvian authorities to the Reflection Forum of the Administrative Commission on Social Security Coordination March 

2015. 

359 Your Europe Advice, Quarterly Feedback Report No 11 (First Quarter, January-March 2015) 
360 Articles 68(3) and 76(4) of Regulation (EC) No 883/2004 and Articles 2, 60(2) and (3) of Regulation No (EC) 987/2009. The Regulation 
expressly provides only that provisional decisions on which Member State has primary competence will become binding after two months. 
361 Decision E1 of the Administrative Commission for Social Security Coordination.12 June 2009 C 106, 24/04/2010, p. 9 
362 Administrative problems in the cross-border exchange of data associated with paper exchange of documents were reported by a number 

of Member States. See Annex VI (p. 17). 

363  Only  a  small  minority  of  national  administrations  have  a  good  view  on  the  actual  administrative  burden  or  are  able  to  support  their 
arguments  with  quantitative  data  or  a  detailed  description  of  the  burden.  A  detailed  analysis  for  seven  Member  States  shows,  that  the 
national administration of primary competence spends on averages around two man-hours per case. For details, see Annex XVI 
364 Eurostat, LFS and European Commission calculations. 
365 The total fertility rate (TFR) is projected to rise from 1.59 in 2013 to 1.68 by 2030 and further to 1.76 by 2060 for the EU as a whole. 
However, during the same period, the proportion of young people (aged 0-19) is projected to remain fairly constant by 2060, while the total 
age-dependency  ratio  (people  aged  below  20  and  aged  65  and  above  over  the  population  aged  20-64)  is  projected  to  rise  from  64.9%  to 
94.5% . European Commission: The 2015 Ageing Report: Economic and Budgetary Projections for the 28 EU Member States (2013-2060): 
Graph I.1.2. 

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still,  a  recent  OECD  Working  Paper366  concluded  that  public  spending  on  family  cash  benefits  is 
significantly associated with an increase in the total fertility rate. The fertility rate is projected to rise 
from 1.59 in 2013 to 1.64 by 2020 in the 2015 Ageing Report. Moreover, the fertility rate is projected 
to increase over this period in nearly all Member States, with the exception of France.  

Intra-EU  cross-border  workers  (i.e.  working  in  a  Member  State  other  than  the  Member  State  of 
residence)  are  the  main  group  of  persons  concerned  by  the  export  of  family  benefits.  Compared  to 
2010, the number of cross-border workers increased sharply in absolute terms, but in relative terms 
(as percentage of the employed population) it has stayed at a relatively stable level of some 0.6% of 
the working population. It moved only from 0.5% of the employed population in 2006 to 0.7% of the 
employed population in 2014.367 There is no indication that the relative level of cross-border workers 
will change considerably between now and 2020. In the 2015 Ageing Report we even read a projected 
negative growth of the number of employed persons (20-64) over the projection period (2013 to 2060. 
However,  between  2013  and  2020  the  number  of  employed  persons  would  increase  by  4.4  million 
persons  (aged  20  to  64):  this  would  result  in  a  projected  increase  of  26,500  cross-border  workers 
(+2.1%) between 2013 and 2020 (assuming that 0.6% of the labour force continues being employed as 
a cross-border worker).  

EU  mobile  workers  appear  to  have  relatively  fewer  children  compared  to  native  workers  (0.31 
compared  to  0.48  children  in  2014).368  While  this  may  reflect  the  reality  that  EU  citizens  are  more 
likely to be mobile when they do not have dependents, it is notable that the average for EU mobile 
workers  has  increased  compared  to  0.25  in  2004.  In  addition,  statistics  show  a  39%  increase  in  the 
number  of  permits  issued  to  children  wishing  to  join  an  EU  citizen  (18.756  in  2008  compared  to 
26.076 in 2013).369 This may imply that as the economic outlook in the EU improves that EU mobile 
parents  will  be  less  inclined  to  seek  work  in  a  different  Member  State  while  leaving  their  children 
behind (at least in the longer-term). Supporting this assumption is the projections for greater levels of 
female labour market participation370 as mothers are more likely to relocate as a family to the Member 
State of work, while men are proportionately more likely to work remotely from the country where 
their partners and children reside. 371  

In  this  way  it  may  be  anticipated  that  the  instances  of  export  of  family  benefits  may  reduce  in  the 
longer term as more mobile workers relocate with their families and because of the expected static or 
even reduced mobility flows. Likewise, in cases of frontier workers, increased levels of labour market 
participation  by  parents  is  likely  to  increase  instances  where  the  Member  State  of  residence  of  the 
child has primary responsibility for payment of family benefits. This trend may increase the numbers 
of  cases  of  export  by  the  secondary  competent  Member  State  but  reduce  the  level  of  benefits  paid. 
Such trends are likely to result in a clearer alignment between the place of residence of the child and 
Member  State  with  primary  responsibility  for  payment  of  Family  Benefits  in  a  manner  which  may 
reduce the perception of unfairness due to the export of family benefits albeit that ongoing pressures 
created by the age-dependency ratio may in part counteract the impact of these trends. In conclusion, 
the  total  spending  on  family  benefits  might  increase  slightly  based  on  the  assumption  that  is 
associated with the minor increase in fertility rate, but there is no indication that spending related to 
the export of family benefits will change in relative terms between now and 2020. 

366  Adema,  W.,  Ali,  N.  and  Thévenom,  O.  (2014),  ‘Changes  in  Family  Policies  and  Outcomes:  Is  there  Convergence?’,  OECD  Working 
Papers, No. 157, OECD Publishing.  
367  Fries-Tersch,  E.  and  Mabilia,  V.  (2015),  Annual  report  on  statistics  on  intra-EU  movers,  Network  Statistics  FMSSFE,  European 
Commission. 
368 Analysis per household with two working age adults . A child is defined as a person aged 0-14, while a working age adult is defined as a 
person aged 15-64 years. Eurostat Labour Force Survey. 
369 There are no reliable data to compare numbers of EU mobile citizens who reside in a different household to their children and the trend in 
number of permits serves as a proxy for the reunification intentions of families. Eurostat First permits issued for family reasons by reason, 
length of validity and citizenship [migr_resfam] 
370  European  Commission:  The  2015  Ageing  Report:  Economic  and  Budgetary  Projections  for  the  28  EU  Member  States  (2013-2060): 
Graph I.2.4 shows The total participation rate of women (for the age group 20-64) in the EU is projected to increase by 6 pp compared with 
1 pp for men. 
371 See Renee Luthra, Lucinda Platt & Justyna Salamońska, Migrant diversity, migration motivations and early integration: the case of Poles 
in Gemany, the Netherlands, London and Dublin (LEQS Paper No. 74/2014) and further research cited. 

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Labour market participation of women 

Labour Market Participation for women is increasing rapidly with ILO predicting a participation rate 
of close to 75% in EU28 by 2020.372 Likewise, in cases of frontier workers, increased levels of labour 
market participation by parents is likely to increase instances where the Member State of residence of 
the child has primary responsibility for payment of family benefits (already based on current LFS data 
in a households where a couple is living with children, 64% of parents are both economically active 
compared with 25% where only one parent is working). This trend may increase the numbers of cases 
of export by the secondary competent Member State but reduce the level of benefits paid per case of 
export by that Member State. Such trends are likely to result in a clearer alignment between the place 
of  residence  of  the  child  and  Member  State  with  primary  responsibility  for  payment  of  Family 
Benefits in a manner which may reduce the perception of unfairness described above. 

However,  in  light  of  this  trend  of  increased  parents'  labour  market  participation  combined  with  the 
trend  of  the  ageing  population  and  increased  family-carer  responsibilities  it  will  be  increasingly 
important that there are flexible family policies to facilitate ongoing participation in the labour market 
during period of child-raising (and other caring obligations) and that barriers to such participation are 
minimised. Therefore the number and importance of child raising allowances is expected to increase 
and without common approach to classifying those benefits the problem of inconsistent treatment of 
families, uneven distribution of burden between Member States and of infringement proceedings will 
persist. 

Delays in processing of family benefits 

It  is  anticipated  that  reported  delays  in  the  processing  of  applications  for  family  benefits  will  be 
reduced  by  the  recent  adoption  of  the  decision  F2  by  the  Administrative  Commission  for  Social 
Security Coordination which imposes maximum time limits for responding to requests for information 
and by the launch of the Electronic Exchange for Social Security Information (EESSI) scheduled for 
launch by the end of 2016 with a deadline for full implementation in all Member State by the end of 
2018 which will introduce common structured electronic documents and a uniform procedure for all 
national authorities to follow when processing claims for family benefits.373  

It may also be assumed that there will be some improvement in public perceptions towards EU mobile 
citizens' access to family benefits arising from co-existing initiatives outside the scope of this review 
such as the Communication on Free movement of EU Citizens and their families: five actions to make 
a  difference  (COM(2013)837final)  and  ongoing  research  and  communication  initiatives  by  the 
Commission such as the development of annual data collection and reporting on the level of export of 
family  benefits  among  Member  States  (including  as a  percentage  of  national  expenditure  on  family 
benefits)  as  compared  to  expenditure  on  family  benefits  in  kind  for  children  resident  in  a  Member 
State will elucidate the debate.374 

7.2.5.  Objectives for review of existing coordination rules on export  

As  with  all  elements  of  this  review  exercise,  the  general  policy  objective  of  this  initiative  is  to 
continue  the modernisation  of  the  EU  Social  Security  Coordination  Rules  by further  facilitating  the 
exercise  of  citizens'  rights  while  at  the  same  time  ensuring  legal  clarity,  a  fair  and  equitable 
distribution  of  the  financial  burden  among  the  institutions  of  the  Member  States  involved  and 
administrative simplicity and enforceability of the rules. 

In  relation  to  family  benefits  in  particular,  this  is  reflected  in  the  need  to  examine  the  reasons  for 
perceptions  of  unfairness  concerning  the  current  rules  on  family  benefits  both  in  relation  to  fair 
treatment  of  mobile  families  and  the  balance  of  financial  burden  between  Member  States  and  to 
examine if there is a need to change the rules in order to counteract the risk of unilateral actions by 
some Member States. It also reflected in the need to ensure clarity in the rules as they apply to child-

372 ILO, Economically Active Population Estimates and Projections. 
373Annex VI, p17.  
374 See also Socio-economic inclusion of migrant EU workers in 4 cities¸ European Commission (2015). 

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raising  allowances  recognising  the  current  inconsistent  treatment  of  such  benefits  by  different 
Member  States  which  creates  uncertainty  for  citizens  and  competent  institutions  and  consequent 
difficulties  in  enforceability.  In  recognition  of  the  current  administrative  complexity  and  delays  in 
processing family benefits, an important criterion in assessing all options under consideration will be 
the need for administrative simplicity and clarity. 

In addition to the general objective the specific objectives in the field of family benefits are defined 
as follows: 

•  To ensure a clear and transparent link between the Member State issuing family benefits and 

the recipients of those benefits; 

•  To reduce barriers or disincentives to parents' ongoing participation in the labour market;  

•  To ensure family benefits are processed as efficiently as possible. 

7.3.  What  are  the  various  options  to  achieve  the  objectives  concerning  export  of  family 

benefits 

There will be no specific option proposed for the problem of delays in processing claims for family 
benefits, as it is anticipated that this issue will be resolved horizontally and through measures already 
envisaged outside the scope of this initiative. 

A number of policy options have been identified to meet the objectives set out in Section 7.2.5. These 
span from non EU-action all the way to creating specific changes to the legal framework375. Whenever 
a combination of options is possible, this is indicated. 

375 As the problems relate to the application of Regulation (EC) Nos 883/2004 and 987/2009, all legislative options concern a  
change to these Regulations. 

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7.3.1.  Option 0: Baseline Scenario:  

Family  benefits  are  exported  to  another  Member  State  at  the  level  of  the  competent  Member  State 
(=State  of  activity  of  the  worker).  They  are  conceptualised  as  benefits  for  the  entire  family  and 
therefore are not regarded as individualised rights but may be transferrable between either parent who 
satisfies the conditions of entitlement. In cases of overlapping entitlement to family benefits, the rules 
of priority apply. 

Example376 1.B: Peter works in Member State A (a country with a higher cost of living) and Marie, his 
non-working  spouse,  resides  with  their  children  in  Member  State  B  (which  has  a  lower  cost  of  living). 
Peter  is  entitled  to  Member  State  A's  family  benefits  at  the  same  amount  as  if  his  family  were  residing  in 
Member  State  A.  Member  State  B  will  not pay  a  differential  supplement  because  the  level  of  family  benefits 
under its national legislation is lower than that provided in Member State A. Either Peter or Marie can make the 
claim for family benefits from Member State A. 

Example 2.B: Anna works in Member State B (a country with a lower cost of living) and David, her non-
working spouse, resides with their children in Member State A (which has a higher cost of living). Anna is 
entitled to Member State B's family benefits at the same amount as if her family were residing in Member State 
B.  If  the  family  is  also  entitled  to  benefits  in  Member  State  A,  Member  State  A  will  also  pay  a  differential 
supplement up to the level of family benefits provided under its national legislation. Either Anna or David can 
make the claim for family benefits from Member States A and B. 

376 The same two examples will be used to present differences in the options for adjusting the level of family benefits. The assumption is that 

a country with a higher cost of living has also a higher level of family benefits and vice versa. 

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7.3.2.  Option 1: Adjustment to standard of living 

Option  1  proposes  that  the  amount  of  exported  family  benefits  would  be  adjusted  according  to  the 
standard of living in the Member State of residence of the child(ren) in two variants (Options 1a and 
1b). 

In  developing  this  option  the  Commission  has  identified  a  risk  that  such  an  option  may  be 
incompatible with primary law if it were to be applied to family benefits to which a citizen (and in 
particular a worker) has an autonomous right existing outside the scope of the Regulation. Therefore it 
is  proposed  that  option  1a  and  1b  would  only  apply to  the  export  of  non-contributory  based  family 
benefits  where  there  is  no  pre-existing  right  of  export  under  national  law.  377  This  safeguard  is 
important as it may exceed the scope of Article 48 TFEU to propose measures that would increase the 
disparities  arising  from  the  absence  of  harmonisation  between  national  legislation  in  a  manner  that 
may have negative ramifications for mobile workers. 378   

7.3.2.1. Option 1a: Adjustment to standard of living: upwards and downwards 

The amount of exported family benefits would be adjusted upwards and downwards according to the 
living standard in the Member State of residence of child(ren). First, the standard of living between 
the  primary  competent  Member  State  and  the  Member  State  where  the  child  resides  would  be 
compared.379380  Second,  this  coefficient  would  be  applied  to  the  amount  of  family  benefits  payable 
under the national legislation of the primary competent Member State. In a case, where both parents 
are  in  employment,  the  Member  State  with  secondary  competence  may  also  apply  the  coefficient 
when calculating the differential supplement. Such an approach would reflect the practice applied for 
adjustment of remuneration (and in certain cases family allowances) of EU civil servants deployed in 
service outside Belgium and Luxembourg.381  

Example  1.1a:  Peter  would  receive  family  benefits  from  Member  State  A  adapted  to  the  living  standard  in 
Member State B and therefore a lower amount than under the current rules. If the amount of family benefits in 
Member State B is lower than the amount in Member State A (the "adjusted amount"), Member State B will 
pay nothing.  

Example 2.1a: Anna will receive family benefits from Member State B increased to reflect the living standard 
in Member State A. If there is also entitlement to family benefits in Member State A, and their level remains 
higher  than  the  "adjusted  amount"  paid  by  Member  State  B,  Member  State  A  will  be  required  to  cover  the 
difference by paying a supplement.  

7.3.2.2.  Option 1b: Adjustment to standard of living: only downwards 

377  This  follows  the  judgment  in  Petroni,  C-24/75,  EU:C:1975:129  approved  in  Jerzak,  C-279/82,  EU:C:1983:228  which  provides  that 
according to Articles 45 and 48 TFEU, which constitute the basis of the coordination, “limitation may be imposed on migrant workers to 
balance the social security advantages which they derive from the Community regulations and which they could not obtain without them”, 
but the Regulations may not withdraw or reduce the social security advantages that derive from the legislation of a single Member State.. On 
the  application  of  this  principle  on  the  differential  supplement  of  family  benefits,  see  the  judgment  in  Dammer,  C-168/88,  not  available, 
paragraph 21 . See Annex VI. 
378 Judgment in Pinna v Caisse d'allocations familiales de la Savoie, C-41/84, EU:C:1986:1, paragraph 21 . It is to be noted that in this case, 
the CJEU ruled that a provision the preceding Regulation, that permitted France to pay the family benefits granted by the Member State of 
residences of the children instead of the family benefits they granted to children residing in France was unlawful because it gave rise to an 
indirect discrimination on grounds of nationality and that the right to freedom of movement was at stake if the migrant worker received less 
than the national workers just because his or her spouse and children remained in the Member State of origin . While there are grounds to 
distinguish Option 1a from Pinna as it proposes adjustment not substitution of benefits and sets objective criteria for ensuring benefits are 
linked to protective needs irrespective of the place of residence, the CJEU's findings must be given due weight.  
379  For  example,  using  data  compiled  by  Eurostat  .  It  could  be  argued  that  the  basket  of  goods  taken  for  these  general  statistics  is  not 
specifically  tailored  to  the  needs  of  a  child,  however  it  could  be  challenging  to  develop  a  more  specific  and  regularly  updated  source  of 
information. 
380 It could be argued that the basket of goods taken for these general statistics is not specifically tailored to the needs of a child, however it 
could be challenging to develop a more specific and regularly updated source of information. 
381  Under  the  Articles  64  and  67(4)  of  Regulation  No  31  (EEC),  11  (EAEC),  laying  down  the  Staff  Regulations  of  Officials  and  the 
Conditions of Employment of Other Servants of the European Economic Community and the European Atomic Energy Community (OJ 45, 
14.6.1962, p. 1385, as amended); the last publication can be found for the period beginning with 1.7.2014 in OJ C 444, 12.12.2014, p. 10. In 
relation to family allowances, this adjustment only applies if the allowance is directly paid to a person other than the official to whom the 
custody  of  the  child  is  entrusted.  The  model  of  the  EU  Staff  Regulations  could  not  be  applied  directly  as  calculations  are  based  on  a 
coefficient compared to the standard of living in Belgium and Luxembourg not the factor of 100 for the EU-28.  

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The amount of exported family benefits is  adjusted downwards only according to the cost of living 
standard in the Member State of residence of child(ren). The level of benefit would be limited to the 
amount  provided  by  the  competent  Member  State.  Under  this  option,  a  Member  State  would  never 
pay  more  than  the  maximum  amount  under  its  national  legislation.  In  cases  of  overlapping 
entitlement, the State of residence of the child(ren) will be required to pay a differential supplement in 
relation to the difference between the "adjusted amount" paid by the primary competent Member State 
and the amount payable under its own national legislation.  

Example 1.1b: Peter would receive Member State A's family benefits adapted to the living standard in Member 
State  B  and  therefore  a  lower  amount  than  under  the  current  rules.  If  the  amount  of  family  benefits  paid  in 
Member State B is lower than the amount paid by Member State A (the "adjusted amount"), Member State B 
will pay nothing.  

Example 2.1b: Anna will receive family benefits from Member State B to the maximum rate permitted under 
national law of Member State B irrespective of the fact that the living standard in Member State A is higher. If 
there is also entitlement to family benefits in Member State A, and their level remains higher than the "adjusted 
amount"  paid  by  Member  State  B,  Member  State  A  will  be  required  to  cover  the  difference  by  paying  a 
supplement.  

The  same  principles  in  relation  to  compatibility  with  Articles  45  and  48  TFEU  set  out  above  also 
apply in relation to Option 1b. 

7.3.3.  Option 2: State of residence of the child always has primary competence 

This option determines new order of priority as follows: 1) country of residence of the child; 2) the 
country  of  work;  and  3)  country  of  pension.  The  country  of  residence  of  the  child  has  primary 
responsibility  to  pay  the  full  amount  of  family  benefits  to  which  the  entitlement  exists  under  its 
national rules. The country of work would top up this amount if the level of family benefits would be 
higher there.  

The  principle  of  priority  for  the  Member  State  of  Residence  of  the  child  already  exists  under  the 
current rules in cases of overlapping rights on the same basis (e.g. where two parents work in different 
Member States). This option extends this principle to cases where only one parent is in work and is 
employed  in  another  Member  State.  The  rationale  for  this  proposal  is  that  in  the  case  of  family 
benefits, almost all national legislations are residence based. Therefore it is hoped that the inversion of 
the  priority  rules  may  mean  a  simpler  situation  for  families  in  which  payments  may  be  processed 
more quickly.  

Example 1.2: Marie will receive family benefits from Member State B. If Peter is also entitled to benefits in 
Member State A, the family would receive a differential supplement from Member State A. The family overall 
receives  the  same  amount  as  under  the  current  rules  but  the  division  of  costs  between  Member  State  A  and 
Member State B is different.  

Example  2.2:  David  will  receive  family  benefits  from  Member  State  A.  As  the  amount  of  family  benefits  in 
Member  State  B  is  lower  than  in  the  Member  State  A,  Member  State  B  will  pay  nothing.  The  family  overall 
receives  the  same  amount  as  under  the  current  rules  but  the  division  of  costs  between  Member  State  A  and 
Member State B is different.  

7.3.4.1 Horizontal Option: Different coordination rules for child-raising allowances: greater 
emphasis on individual rights and different treatment under the anti-overlapping rules 

This  section  sets  out  a  number  of  horizontal  options,  which  may  be  applied  in  isolation  or  in 
conjunction with any of the options above. As there are no synergies or inter-dependencies between 
the impacts it is intended to assess the impact of these options separately. 

It should be made clear that these options relate solely to the right to claim a social security benefit 
intended  to  wholly  or  partially  replace  income  during  periods  of  child-raising.  The  option  does  not 

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propose  to  create  or  extend  rights  to  parental  leave  which  may  separately  exist  under  the  Parental 
Leave Directive,382 national legislation or collective agreement.  

7.3.4.2 Different coordination rules for child-raising allowances calculated by reference to 
salary or professional income: greater emphasis on individual rights and mandatory 
derogation from the anti-overlapping rules 

Salary-related  child  raising  allowances  (or  any  salary-related  components  of  a  benefit  which 
comprises  of  both  salary-related  and  flat  rate  elements)  would  continue  to  be  exportable  as  family 
benefits,  but  would  be  treated  as  individual  and  personal  rights  which  may  only  be  claimed  by  the 
parent who is subject to the applicable legislation in question (not by other members of their family). 
In  addition, it  is  proposed  that  no  anti-overlapping  rules  would  apply to  such benefits  meaning that 
they would be payable in full to the parent concerned.  

Where  under  national  legislation,  parents  are  permitted  to  share  a  salary-related  child  raising 
allowance,  the  parent  who  is  subject  to  applicable  legislation  is  entitled  to  the  allowance  for  the 
maximum  duration  permitted  under  national  legislation.383    However,  where  a  family  receives  a 
salary-related  child  raising  allowance  in  more  than  one  Member  State,  national  authorities  will  be 
entitled to "off-set" periods of entitlement in another Member State from the overall duration of the 
benefit (although not the amount). 

Example  1.3a:  Peter  and  Marie  live  with  their  child  in  Member  State  A  (which  has  a  child  raising 
allowance calculated by reference to salary). Marie is a national worker of Member State A. Peter is a 
posted worker from Member State B. (Member State B has a flat rate allowance). Member State A is the 
primarily competent Member State because this is the place of residence of the child. When Marie takes leave 
to  take  care  of  her  child  she  is  able  to  claim  the  child-raising  benefit  from  Member  State  A.  Peter  has  no 
entitlement to salary-related component of the child-raising benefit from Member State A. If Peter claims the 
child-raising allowance from Member State B, Member State B cannot into account the salary-related benefit 
from Member State A's child-raising allowance in calculating the level of supplement Peter is entitled to.  

Example 2.3a: David lives and works in Member State A. Anna his wife lives in Member State A but 
works in Member State B. Both Member State A and Member State B have salary-related child-raising 
allowances. Member State A is the primary competent Member State because this is the place of residence of 
the  couple's  children.  David  is  able  to  claim  salary-related  child-raising  benefit  during  periods  he  has  taken 
leave  to  take  care  of  their  children.  According  to  Member  State  A's  legislation,  each  parent  is  individually 
entitled  to  13  weeks  of  salary-related  child  raising  allowance.  However,  as  Anna  is  unable  to  claim  the 
allowance  under  Member  State  A's  legislation,  David  is  entitled  to  26  weeks  of  salary-related  child-raising 
benefit  (assuming  national  entitlement  conditions  are  satisfied).  Anna  is  separately  entitled  to  salary-related 
child-raising benefit under Member State B's law. However, if Anna makes a claim for salary-related child-
raising benefit during the same period as David, Member State B will be entitled to take into account periods 
of benefit that David has already claimed in calculating the length of period of leave although Member State B 
may  not  deduct  amounts  already  paid  by  Member  State  A  when  calculating  the  level  of  benefit  payable  to 
Anna. 

7.3.4.3 Different coordination rules for all-child raising allowances (flat rate and salary-
related): greater emphasis on individual rights and mandatory derogation from the anti-
overlapping rules. 

As  a  variation  to  the  horizontal  option  described  above,  it  could  also  be  considered  to  extend  the 
horizontal  option  A  so  it  applies  to  all  child-raising  allowances  regardless  of  whether  they  are 
calculated by reference to salary/professional income or are awarded on a flat-rate basis. 

382 2010/18/EU   
383  taking  into  account  restrictions  that  may  separately  exist  to  the  labour  law  right  to  parental  leave  under  the  Parental  Leave  Directive 

2010/18/EU   

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Example 1.3b: Marie will receive the full amount of child-raising allowance but Peter will have no entitlement 
to child-raising allowances from Member State A. Member State B cannot take into account any of the child-
raising allowance paid by Member State A when calculating the level of child-raising allowance Peter is entitled 
to. 

Example 2.3b: David and Anna will be treated in the same way as under example 2.3a 

7.3.4.4 Different coordination rules for all-child raising allowances (flat rate and salary-
related): greater emphasis on individual rights and optional derogation from the anti-
overlapping rules 

As a further variation to the horizontal options described above, it could also be considered to provide 
that  child-raising  allowances  (either  salary-related  only  or  salary-related  and  flat-rate)  should  be 
treated as individual and personal rights which may only be claimed by the parent who is subject to 
the  applicable  legislation  in  question,  however,  it  is  only  optional  rather  than  mandatory  for  a 
secondary competent Member State to exempt such benefits from the anti-overlapping rules Such an 
approach  would  allow  national  administrations  greater  flexibility  to  promote  flexible  child-raising 
arrangements  in  line  with  national  policy  objectives  of  the  Member  States  concerned  but  the 
requirement would not be mandatory.  

There will be no requirement to allocate the maximum duration of child-raising allowance permitted 
under  national  legislation  to  the  parent  subject  to  the  applicable  legislation  concerned  and 
consequently no requirement to "off-set" periods of taken by the other parent under the law of another 
Member State. 

Example 1.3c: Marie will receive the full amount of child-raising allowance but Peter will have no entitlement 
to child-raising allowances from Member State A. Member State B (as secondary competent Member State) will 
have a choice whether to take into account any of the child-raising allowance paid by Member State A when 
calculating the level of child-raising allowance Peter is entitled to. This choice will be exercised in relation to all 
claims for the benefit concerned (not on a case-by-case basis) 

Example  2.3c:  David  will  receive  13  weeks  of  child-raising  allowance  (the  normal  period  for  an  individual 
parent under Member State A's law), the duration of the child-raising allowance that Anna receives will depend 
on the national conditions of Member State B's law.  

7.3.5 Discarded option 

It was  also considered that family benefits would be provided by the Member State of residence of 
child(ren)  under  its  national  legislation  only,  i.e.  no  export  of  family  benefits.  4  Member  States 
supported this option.384  

This  option  has  subsequently  been  discarded  by  the  Commission  on  grounds  it  is  considered 
incompatible  with  the  Treaty  on  Functioning  of  the  European  Union,  in  particular  as  the  refusal  to 
export  family  benefits  has  already  been  ruled  contrary  to  Article  45  TFEU.385  The  right  to  family 
benefits  is  granted  to  workers  by  reason  of  their  employment  in  the  Member  State  of  employment. 
Refusing  to  grant  them  the  right  to  equal  treatment  as  regards  entitlement  to  family  benefit  would 
amount to a violation of primary law. 

384 Luxembourg, Malta (in relation to family benefits specific to the social or economic conditions of the Member State), Finland and the 

United Kingdom. Annex II. 

385 Joined Cases C-4/95 and C-5/95, Stöber and Pereira ECLI: EU: C: 1997:44 (amongst others).  

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7.4. 

Stakeholder Support 

7.4.1  Baseline Scenario 
In discussions in the Administrative Commission in March and June 2015, 16 Member States386 were 
in favour of maintaining the status quo in preference to adjusting benefits to option 1a or b or 2. In 
consultation  with  stakeholders  also  indicated  the  status  quo  was  favoured  by  a  number  of  national 
organisations  with  responsibility  for  family  benefits  such  as  REIF,  SVB,  CNAF,  CCMSA  and 
FAMIFED.  In  the  response  to  the  public  consultation  only  33%  of  organisations  and  31%  of 
individuals indicated support for legislative change.387 

7.4.2  Adjustment to standards of living 

7.4.2.1 Option 1a: Adjustment to standards of living: upwards and downwards 
Three  Member  States388  supported  this option  in  the  Administrative  Commission.  NGOs  underlined 
the unfairness of adaptation, since the workers concerned pay the same taxes, but also the fact that, for 
the  competent  Member  State,  adapting  family  benefits  may  have  unintended  consequences  if  the 
concerned families were to move to the Member State as a result. In this sense, it was mentioned that 
the biggest challenge for local authorities is pressure on public services, and not "benefit tourism".389 
Social  partners390  pointed  out  that  the  right  to  family  benefits  should  be  considered  attached  to  the 
worker and not to the place of residence of the family. In their view lowering the family benefits for 
mobile  workers  would  in  any  event  constitute  unequal  treatment.391  In  the  response  to  the  public 
consultation, only a minority of respondents commented on the issue of adjustment of family benefits 
to the place of residence of the child. Among those that did there were mixed responses, with some 
respondents indicating strong support for this principle and others strong opposition. 

7.4.2.2 Option 1b: Adjustment to standards of living: only downwards 

No  Member  States  expressly  supported  this  option  in  the  Administrative  Commission.  Stakeholder 
feedback was similar to Option 1a.  

7.4.3  Option 2: Member State of Residence of the child always has primary competence 
10  Member  States392  supported  this  option  as  a  first  or  second  choice  but  9  Member  States393  were 
expressly opposed to the option in the Administrative Commission. Some social partners emphasized 
that the right to family benefits should be considered attached to the worker and not to the place of 
residence of the family.394 In the response to the public consultation, only a minority of respondents 
commented on the issue of a change to the order of competence so the place of residence of the child 
always  has  primary  competence.  Among  those  that  did  there  were  mixed  responses,  with  some 
respondents indicating strong support for this principle (in particular because they considered it would 
improve  the  simplicity  and  efficiency  of  the  rules  and  create  a  stronger  link  to  the  economic 
environment  where  the  child  resides).  However,  others  expressed  strong  opposition  to  the  idea  of 
reducing  the  link  between  the  Member  State  of  Employment  and  competence  for  providing  family 
benefits. 

386  Belgium,  Bulgaria,  Czech  Republic,  Estonia,  Spain,  Croatia,  Italy,  Latvia,  Lithuania,  Poland,  Portugal,  Romania,  Slovenia,  Slovakia, 

Finland and Sweden. 

387 A public consultation between July and October 2015 invited citizens and organisations to provide their views on  
the main problems linked to the coordination of unemployment benefits, family benefits and posting of workers. 
388 Denmark, Ireland and France. Annex II. 
389 For example, EURODIACONIA. Annex II. 
390 Annex II. 
391 For example, ETUC and TUC (Trades Union Congress, United Kingdom).Annex II. 
392 Austria, Estonia, Finland, Ireland, Latvia, Luxembourg, Malta, Slovenia, Sweden and the United Kingdom 
393 Cyprus, Germany, France, Italy, Netherlands, Poland, Portugal, Romania and Slovakia 
394 For example, ETUC and TUC (Trades Union Congress, United Kingdom). Annex II. 

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7.4.4 

 Horizontal Option: Different Coordination of child-raising allowances 

This  option  was  initially  not  envisaged  and  was  developed  in  response  to  the  stakeholders' 
feedback.395  

In March and June 2015, 4 Member States in the Administrative Commission indicated support for an 
alternative coordination of salary-related child-raising allowances and action was also recommended 
by the FreSsco network of experts (see Annex VI396).  

The Council, the Parliament, the social partners, the Advisory Committee on Equal Opportunities for 
Women and Men and other stakeholders have called for developing a comprehensive set of measures 
to address women’s under-representation in the labour market and to support more equal sharing of 
family responsibilities. In June 2015, EPSCO Council Conclusions15 highlighted that measures could 
include improving the provision of childcare and long-term care, flexible working time arrangements, 
addressing financial disincentives for both parents (and single parents) to participate in paid work, as 
well  as  supporting  smoother  transitions  for  women  and  men  between  part-time  work  and  full-time 
employment, and between care-related leave periods and employment. The European Social Partners 
have also recognised that work-life balance and gender inequality in the labour market remain serious 
challenges.  They  have  made  "promoting  better  reconciliation  of  work,  private  and  family  life  and 
gender equality to reduce the gender pay gap" a priority in their new joint work programme for 2015-
2017. 

7.5.  What are the Impacts of the Different Options 

7.5.1 

Introduction 

For  all  of  the  options  assessed,  the  potentially  affected  groups  are  the  same.  The  options  are 
specifically targeted at mobile EU parents and their children, that is to say: citizens who either work 
or reside in a different State to that where their  children reside. Hence, it may concern both mobile 
workers and frontier workers or other cross-border workers. It may also concern non mobile citizens 
and  children  who  have  not  exercised  their  right  to  freedom  of  movement  but  who  have  a  parent  or 
partner (or former partner) who is a mobile citizen.  

For the purposes of assessing the impact, a range of criteria has been identified with reference to the 
general  and  specific  policy  objectives  for  family  benefits  and  the  Commission's  Better  Regulation 
Guidelines. In relation to social impact, the options are assessed against the criteria of clarification; 
simplification;  protection  of  rights  and  impact  upon  fundamental  rights  (with  reference  to  the 
specific  objective  this  analysis  also  includes  an  assessment  of  the  potential  impacts  of  barriers  or 
disincentives  to  parents'  ongoing  participation  in the  labour market). This analysis draws upon 
the  findings  of  the  FreSsco  Legal  Experts  report  at  Annex  VI  supplemented  by  the  Commission's 
Services  own  analysis  and  the  findings  from  the  stakeholder  consultations  and  the  Inter-Service 
Steering Group. 

In relation to Fundamental rights all options under consideration aim to facilitate the exercise of the 
right to engage in work in another Member State (Article 15), as well as to a better protection of rights 
for  workers  who  have  made  use  of  their  right  to  free  movement  (Article  45).  At  the  same  time  the 
options seek to ensure the right to equal treatment (Article 21), the best interests of the child (Article 
24), rights of the family in particular to reconcile family and professional life (Article 33(2)), the right 
to property and social security (Articles 17 and 34).  

In  relation  to  the  economic  impact,  the  options  are  assessed  against  the  impact  on  Member  States' 
budgets.  It  has  to  be  noted  that  19  Member  States  and  EFTA  countries  (Belgium,  Czech  Republic, 

395 This option was developed following consultation with Member States in the Administrative Commission in March and June 2015 and 

feedback from other stakeholders . See Annex II and Annex VI. 

396 SPIEGEL, B. (ed.), CARRASCOSA BERMEJO, D., HENBERG, A. and STRBAN, G., Assessment of the impact of amendments to the 
EU social security coordination rules on export of family benefits, Analytical Report 2015, FreSsco, European Commission, May 2015 
(Annex VI). 

15 2015 EPSCO Council Conclusions on the Gender Pension Gap. 

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Denmark,  Germany,  Estonia,  Ireland,  Spain,  Latvia,  Luxembourg,  Hungary,  Netherlands,  Austria, 
Poland, Romania, Slovakia, Finland, United Kingdom, Iceland and Norway) were able to provide data 
on the export of family benefits, while 10 (Czech Republic, Germany, Estonia, Latvia, Luxembourg, 
Hungary, Netherlands, Austria, Slovakia and Iceland) were able to provide a breakdown of exported 
family benefits by primary and secondary competence397. This entails a number of limitations in the 
assessment  of  the  economic  impact  of  option  2  (reversing  priority  rules)  and  the  horizontal  options 
(different  coordination 
for  salary-related  child-raising  allowances),  which  will  be 
presented/discussed  in  full  in  the  section.  In  particular,  for  reasons  of  practicality,  the  economic 
analysis  has  also  been  conducted  based  on  the  assumption  that  all  Member  States  are  in  full 
compliance  with  the  EU social  security  coordination  rules  currently  in  force  including  in respect  of 
the most recent jurisprudence of the Court of Justice. It should further be noted that in the absence of 
comprehensive  data  from  the  Member  States,  the  economic  assessment  for  the  horizontal  option  is 
made  with  reference  to  ESSPROS  figures  for  parental  benefits  awarded  for  children  aged  0-3 
regardless of whether or not the benefit is indexed to salary or professional income. The estimations 
must be construed in light of these limitations. The full studies are attached to this report at Annexes 
XI and XIII398. 

rules 

The regulatory costs for both public administrations and citizens in relation to Options 1a, 1b and 2 
were  assessed  through  a  number  of  interviews  with  public  officials  working  for  administrations 
dealing  with  the  export  of  family  benefits  (both  as  primarily  competent  and  secondarily  competent 
Member  States)  in  six  Member  States  (Germany,  Denmark,  Netherlands,  Poland,  Romania  and  the 
United  Kingdom).  The  full  study  is  attached  to  this  report  in  Annex  XVI.399  This  assessment  also 
takes into account the specific objective of faster and more efficient processing of family benefit 
claims.  

With reference to coherence with the general objective, the options have also been assessed with 
reference to their impact upon risk of fraud and abuse and ability of Member States to counteract 
such risks and by reference to the objective of achieving equitable burden-sharing between 
Member States (corresponding to the specific objective of achieving a clear and transparent link 
between Member State paying benefits and recipient). Finally the assessment considers overall 
coherence with EU objectives with reference to relevant policies identified at section 1.3 of this 
report.  

The secondary impacts of the options on mobility flows was estimated on the basis of case studies in 
seven Member States (Belgium, Germany, Poland, Romania, Netherlands, Spain and Ireland), with a 
target  population  of  one-earner  families  in  which  the  person  entitled  to  the  exportability  of  child 
benefits  works  and  resides  in  a  Member  State  different  from  the  one  where  the  dependent  family 
member  resides400.  The  full  study  is  attached  to  this  report  in  Annex  XVIII.  It  should  be 
acknowledged  however,  that  such  methodologies  are  imperfect  tools  for  predicting  families' 
motivations and migration drivers which in practice are likely to be influenced by a far-wider range of 
factors than purely economic influences. 

Finally,  when  looking  in  particular  at  economic  impact,  regulatory  costs  and  secondary  impact  for 
horizontal options a, b and c, it must be noted that these options were developed and refined at a late 
stage of the impact assessment process. Therefore, in addition to the limitations already highlighted 
due  the  limitations  on  data  highlighted  above,  the  late  development/refinement  of  the  horizontal 
options has led to a less detailed assessment of impact, at times only at a qualitative level.  

397 P. 6, Annex XI 
398 PACOLET and DE WISPELAERE Export of family benefits, Analysis of the economic impact of the options, 2015 (Annex  
XIII). 
399 Julie Abrahamsen, Monica Lind, Peter G. Madsen, Administrative costs of handling exports of family benefits, 2015 (Annex  
XVI). 
400 Michele Raitano, Matteo Luppi, Riccardo Conti, Diego Teloni, Secondary effects following a change of regulations on the exportation of 
family benefits, 2015 (Annex XVIII). 

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7.5.2  Summary table of the impacts of the options for export of family benefits 

Type of impact  Clarification 

Simplification 

Protection 
rights 

of 

Fundamental 
rights 

Economic 
impacts 

Regulatory 
costs 

Risk  of  fraud 
and abuse 

Equitable 
burden sharing 
Member State 

Coherence 
with 
objectives 

Overall 
Effectiveness 

EU 

Overall 
Efficiency 

(cost 
effectiveness 

vs 

0 

- 

-- 

Baseline 
Scenario 

Option 1a 

Adjustment to 
standards of 
living: upwards 
and downwards 

Option 1b 

Adjustment to 
standards of 
living: only 
downwards  

Option 2 

++ 

Member State 
of residence has 
primary 
competence 

0 

-- 

- 

+ 

0 

--/+ 

-- 

+ 

0 

- 

- 

0 

0401 

+/-403 

0402 

--404 

+405 

--406 

0 

- 

- 

0 

+/- 

0 

-- 

++/- 

-- 

+/-407 

+/-408 

+ 

+/- 

+ 

0 

- 

- 

+ 

0 

- 

- 

+ 

401 €942 m is the budget devoted to exported child benefits in 19 reporting Member States; Annex XIII; Table 9. 
402 Cost for handling export of FB is estimated at on average 1.9 man hours per case for the primary competent Member State and at 1.6 man hours per case for the secondary competent Member State this corresponds to  
an annual cost in the range of between €40 and €2,000 in selected Member State (variation according to number of cases and labour costs). 
403 Overall decrease of €150m (-15.9%) but increase for Member State with lower cost of living. 
404 Increase of approx. one man-hour per case. 
405 Overall decrease of €156m (-16.6%). 
406 As 1a above. 
407 Decrease of exported benefits of €420m (-30%) but increase in expenditure of State of residence by up to 120%. 
408 Moderate decrease in cases of recovery and overpayments but moderate increase in cases of differential supplement and verification of residence. 

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Horizontal A 

++ 

+ 

+/- 

+/- 

--409 

+/-410 

+ 

+/- 

++ 

++ 

+ 

Personal  rights 
to  salary-linked 
child-raising 
allowance 
mandatory 
derogation  from 
overlapping 
rules  

Horizontal B 

Personal rights  

for  all  child-
raising 
allowance 
mandatory 
derogation  from 
overlapping 
rules 

++ 

+ 

+/- 

+/- 

--411 

+/-412 

+ 

+/- 

++ 

++ 

+ 

Horizontal C 

-/+ 

+ 

+/- 

+/- 

--413 

+/-414 

+ 

+/- 

+/- 

+/- 

+ 

Personal rights  

for  all  child-
raising 
allowance 
optional 
derogation  from 
overlapping 
rules 

409 Estimated Increase in expenditure on exported salary-related child-raising allowances for secondary competent Member State of 62-81%. 
410 Moderate decrease in regulatory costs No need to process/ calculate claims on derived rights . Some new tasks to compare benefits in different Member State. 
411 Estimated Increase in expenditure on exported child-raising allowances for secondary competent Member State of 58-84%. 
412 Same as Horizontal Option a but wider field of application as covers all child-raising benefits. 
413 Maximum impact same as Horizontal Option b (but not all Member States will rely upon the derogation).  
414 Maximum impact same as Horizontal Option b with added advantage that no need to compare duration of claims in other Member States (but not all Member States will rely upon the derogation therefore information 

exchange for differential supplement may continue). 

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Impacts of Policy Option 1a: Adjustment to standard of living: upwards and 

7.5.3 
downwards 

Policy Option 1a:  Adjustment to standard of living: upwards and downwards 

Social impacts 

Clarification 

Simplification 

- 

-- 

Protection of rights 

--/+ 

Financial impact 

+/- 

This option is less transparent than the baseline scenario. There 
is a significant risk that mobile workers would be less aware of 
the  level  of  benefits  they  are  entitled  to  as  the  amount  of  the 
family  benefit  received  would  be  subject  to  fluctuations 
depending on various factors, such as macro-economic criteria 
or the country of residence of the children during the life-cycle 
of a family benefit claim. This may affect the citizens' ability to 
assert and enforce their rights.  

In  comparison  to  the  baseline,  this  option  is  more  complex  to 
apply  as  it  imposes  additional  obligations  for  mobile  workers 
and public administrations to state and verify the Member State 
of  residence  of  the  children.  Possible  changes  in  the  Member 
State  of  residence  of  the  children  or  macro-economic  changes 
would  result  in  additional  administrative  obligations  for  the 
mobile worker and public authorities in changes in the amount 
of the benefit granted by one and the same Member State. 

This option will result in EU mobile families receiving either a 
lower or higher level of family benefits than would normally be 
awarded by the exporting Member State depending on the cost 
of  living  in  the  country  where  the  child  resides.  It  can  be 
anticipated  that  the  most  likely  situation  is  that  the  family 
benefits will be lower. Firstly, because trends in labour mobility 
patterns show a bias in mobility from lower wage destinations 
towards  higher  wage  destinations.  Secondly,  because  the 
existing  rules  relating  to  the  differential  supplement  already 
ensure that a family will receive a "top-up" from the secondary 
competent Member State to the level awarded by that Member 
State.  This  existing  provision  under  the  baseline  scenario 
already  mitigates  against  the  potential  disadvantage  that  a 
family  who  resides  in  a  high-cost  of  living  destination  but 
workers  in  a  lower  cost  of  living  destination  might  otherwise 
experience meaning the positive financial impact for the mobile 
worker arising from this option are expected to be marginal.  

The adjustment of the amount of exported family benefits could 
decrease the total expenditure on exported family benefits by € 
150  million  (15.9%).  Member  States  with  a  higher  cost  of 
living  compared  to  the  countries  where  they  currently  export 
family benefits will experience a reduction in their expenditure 
on exported family benefits – by more than 30% in the case if 
Germany (€34 million) and Ireland (€4 million), by 13% in the 
case of Luxembourg, . By contrast, Member States with a lower 
cost  of  living  compared  to  the  countries  where  they  currently 
export  family  benefits  will  experience  an  increase  in  their 
expenditure on exported family benefits to a level that is higher 
than  permitted  under  their  own  national  rules.  This  increase 

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Impacts on fundamental rights 

- 

Other impacts 

Regulatory Costs 

-- 

would  be  above  70%  for  Poland  (€ 4  million)  and  above  40% 
for  Latvia  (€  50,000)415,  37%  for  Estonia,  35%  for  Slovakia, 
21%  for  Hungary.  Extending  this  analysis  to  the  EU-28,  in 
principle,  all  Member  States  with  the  exception  of  Denmark 
(the State with the highest index for comparative price levels416) 
would  have  to  raise  its  family  benefits  at  least  in  respect  of 
export of family benefits to a child resident in Denmark. 

In  the  case  of  a  lower  adjustment,  this  option  may  adversely 
affect the right to property (in this case social security benefits) 
(Article  17);  the  right  to  equal  treatment  (Article  21)  and  the 
best  interests  of  the  child  (Article  24)  and  the  right  to  social 
security and social assistance (Article 34) when compared with 
the  baseline  scenario.  In  particular,  compared  to  the  baseline 
scenario,  workers  would  receive  lower  or  higher  levels  of 
family benefits that their co-workers even though they pay the 
same taxes and social security contributions. Likewise Member 
States  with  a  lower  cost  of  living  would  be  required  to  export 
family  benefits  at  a  higher  rate  than  is  awarded  to  national 
citizens resident within their territory.  

Even  though  there  is  precedence  for  deductions  from  family 
benefits  in  the  context  of  the  anti-accumulation  rules,  the  fact 
that these options do not guarantee that the family of a mobile 
worker will receive a sum at least equivalent to the highest rate 
available under the overlapping applicable legislation also gives 
rise to concerns of interference with the right to Property under 
Article 17.  

This option would increase the administrative burden compared 
with  the  current  rules.  The  running  cases  would  need  further 
administrative processes as e.g. the updating of the adjustment 
factors  has  to  be  made  on  a  regular  basis  (even  if  national 
amounts  do  not  change).  Processing  times  between  the  claim 
being filed and benefit being received could be increased due to 
the  verification  of  residence.  In  addition,  as  application  of 
indexation to rights deriving from worker-status or which exist 
independently  of  the  application  of  the  Regulation  would 
violate  primary  law,  there  will  be  additional  administrative 
tasks,  for  example,  to  distinguish  between  contributory  and 
non-contributory family benefits in each Member State.  

On  the  basis  of  the  interviews  conducted  with  national 
administrations,  it  is  estimated  that  the  administrative  tasks  as 
primarily competent may increase by around one man-hour per 
case (+49%), mainly due to the increase in the time devoted to 
the  calculation  of  benefits  and  the  reimbursement  activities417: 
The total cost will thus increase of a sum ranging from €12,900 
in Romania (+300%) to 1,068,100 (+60%) in Germany418.  

The  administrative  tasks  of  secondarily  competent  Member 
State,  will  also  increase  by  around  one  man-hour  per  case 
(+60%),  mainly  due  to  the  increase  in  the  time  devoted  to  the 

415 Table 13, Annex XIII. 
416 http://ec.europa.eu/eurostat/tgm/table.do?tab=table&init=1&language=en&pcode=tec00120&plugin=1 (last accessed 25 March 2015). 
417 Table 3-1, Annex XVI. 
418 Tables 3-1, 3-2, 3-3 and 3-4, Annex XVI. 

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calculation  of  benefits,  as  it  becomes  more  complex.  this  will 
translate into an increase in the cost per case (ranging from €1.4 
in Romania to €58.3 in Denmark).  

It  is  not  estimated  that  this  option  would  increase  the 
administrative  burden  for  citizens,  though  longer  processing 
times  of  the  cases  may  well  have  a  negative  impact  in 
increasing  delays  between  application  and  receipt  of  family 
benefits419. 

Families could be tempted to declare that their children live in a 
Member State with a higher factor of adjustment (or even in the 
Member State with primary competence), as far as the amount 
of  the  benefits  would  depend  on  the  children’s  place  of 
residence. For the Member State with primary competence, the 
children’s  place  of  residence  is  usually  more  difficult  to 
determine  than,  for  example,  the  place  of  work,  so  the  risk  of 
abuse  could  increase  necessitating  additional  activities  by 
Member  States  to  counter  this  risk.  Further,  the  greater 
complexity  entailed  in  indexation  may  increase  the  risk  of 
administrative error by public authorities. 

This  option  shifts  the  burden  from  the  Member  States  with  a 
higher factor  of  adjustment,  i.e.  those  where  income  and costs 
are higher, to Member States with lower factors of adjustment. 
In particular, it will require Member States with lower costs of 
living to export family benefits at a higher rate than payable to 
national citizens within their own territory. This shift in burden 
is  exacerbated  due  to  the  effect  of  the differential  supplement. 
As  compared  with  the  baseline  scenario,  more  Member  States 
with  lower  income  and  costs  may  be  required  to  pay  a 
differential supplement than under the current rules. Taking into 
account that migration patterns usually are from Member States 
with lower living standards to those with higher standards, this 
option  would  probably  shift  the  burden  from  the  latter  to  the 
former. This could result in a certain disruption of the economic 
logic that assigns the obligation to pay the family benefits to the 
Member State receiving the contributions and taxes. 

This option could entail a moderate reduction of mobility flows 
of one-earner married persons who would move without his/her 
family  towards  Member  States  with  relatively  higher  cost  of 
living  with  subsequent  consequences  for  the  skills  availability 
to  those  labour  markets.420  On  a  sample  of  six  Member  States 
when  all  factors  are  neutral  it  may  be  expected  to  have  the 
following impact: Netherlands (-4%), Germany (-3%), Belgium 
(-1.%),  Spain  (-0.9%)  and  Ireland  (-0.7%)  –  and  an  increase 
towards  Member  States  with  relatively  lower  cost  of  living  – 
Poland  (3%)  and  Romania  (8%)421.  This  would  entail 
consequent  reductions/increases  in  the  budget  devoted  to 
exported family benefits422. 

However,  another  possible  secondary  effect  could  also  be  that 
dependent  family  members  would  reunite  with  the  working 

Risk of fraud and abuse 

- 

Fair  burden 
Member States 

sharing  between 

+/- 

Mobility 

-/+ 

419 Page 32, Annex XVI. 
420 Annex XVIII. 
421 Figure 4.1, Annex XVIII. 
422 Figure 5.1, Annex XVIII. 

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Coherence  with  General,  Specific 
and wider EU Objectives: 

-- 

Continue the  modernisation of the EU 
Social Security Coordination Rules by 
further  facilitating 
the  exercise  of 
citizens'  rights  while  at  the  same  time 
ensuring 
legal  clarity,  a  fair  and 
equitable  distribution  of  the  financial 
burden  among  the  institutions  of  the 
and 
Member 
administrative 
and 
enforceability of the rules. 

simplicity 

involved 

States 

• 

• 

• 

Ensure  a  clear  and  transparent 
link  between  the  Member  State 
issuing  family  benefits  and  the 
recipients of those benefits 

barriers 
to 

Remove 
disincentives 
ongoing  participation 
labour market  

or 
parents' 
the 
in 

Ensure 
family  benefits  are 
processed  as  efficiently  as 
possible 

partner/parent  working  in  another  (with  higher  living  cost) 
Member States, which would counterbalance the effects of the 
option423.  The  impact  of  such  reunification  may  potentially 
have consequences for the education, health, housing and other 
systems of the Member State of the economically active citizen. 
In  the  context  of  the  low  flows  anticipated  no  estimates  have 
been carried out for the economic impact of this.  

This  analysis  ignores  other  variables  that  may  influence  a 
family's decision about whether or not to relocate and needs to 
be viewed accordingly. 

This  option  achieves  a  greater  correlation  between  family 
benefits and the cost of living in a manner likely to address the 
perceptions of unfairness held by some critics. However, it does 
not  fully  achieve  the  aim  of  achieving  a  fair  distribution  of 
financial burden as it disrupts the economic logic that the State 
that receives taxes and social security contributions should have 
responsibility for paying benefits by transferring the economic 
burden  from  the  Member  State  of  Work  to  the  State  of 
Residence. It also does not achieve a clear and transparent link 
between the Member State issuing a benefit and the families in 
receipt  of  such  benefits  as  Mobile  workers  will  receive  lower 
level of family benefits than nationals notwithstanding the fact 
they pay the same level of tax and social security contributions 
(conversely  Member  States  with  comparatively  lower  costs  of 
living  may  be  required  to  export  family  benefits  at  a  higher 
level  than  payable  to  citizens  resident  on  their  territory  in  a 
manner  likely  to  be  perceived  as  unfair  by  nationals  of  that 
State).  The  option  also  reduces  clarity  and  legal  certainty 
compared  to  the  baseline  particularly  in  relation  to  level  of 
entitlement and which benefits may be subject to indexation. It 
is  likely  to  be  administratively  burdensome  for  both  citizens 
and  national  authorities  to  apply.  This  option  may  increase 
rather 
to  parents'  ongoing 
participation  in  the  labour  market  during  periods  of  child-
raising (at least in relation to non-contributory benefits) as such 
benefits will not only be subject to the anti-accumulation rules 
but also subject to reductions based on place of residence of the 
child. It may also increase delays in processing family benefits.  

reduce  disincentives 

than 

7.5.4 

Impacts of Policy Option 1b: Adjustment to standard of living: downwards only 

Policy Option 1b:  Adjustment to standard of living: only downwards 

Social impacts 

Clarification 

423 Pp. 33-34, Annex XVIII 

-- 

As with Sub-option 1a, and for the same reasons, this option is 
less  clear  or  easy  to  understand  than  the  baseline  scenario.  In 
addition, changes in the relative cost of living between different 
Member  States  means  it  may  be  even  less  clear  to  workers 
whether  they  can  expect  family  benefits  to  be  exported  at  the 

EN 

147 

   EN 

 
 
 
                                                 
Simplification 

Protection of rights 

Financial impact 

- 

-- 

+ 

Impacts on fundamental rights 

- 

Other impacts 

Regulatory Costs 

-- 

national level or indexed at a lower level.  

As with Sub-option 1a, and for the same reasons, this option is 
less clear or easy to understand than the baseline scenario.  

This  option  is  anticipated  to  have  the  same  social  impact  as 
option  1a,  exacerbated  further  compared  to  the  baseline 
scenario because it does not improve the protection of rights of 
beneficiaries residing in a Member State with a higher standard 
of living and further may increase the lack of clarity concerning 
the  level  of  family  benefits  payable  as  indexation  will  not  be 
applied consistently in all cases 

There is expected to be a  moderate, decrease of € 156 million 
(16.6%)  in  the  expenditure  on  exported  family  benefits  would 
occur.  It  is  predicted  that  all  reporting  Member  States  would 
now  experience  either  a  reduction  or  no  change  to  their 
expenditure  on  exported  family  benefits  compared  to  the 
baseline,  which  will  be  nearly  40%  for  Ireland  (€  4.5  million) 
and  above  30%  for  Germany  (€  36  million)424  the  change  is 
more negligible for Latvia, Poland, Hungary, Slovakia and the 
Czech  Republic  where  the  estimated  impact  ranges  from  0-
0.5% (€0-8,230). 

This  option  is  anticipated  to  have  the  same  impact  upon 
fundamental rights as option 1a, exacerbated further because it 
does  not  improve  the  protection  of  rights  of  beneficiaries 
residing in a Member State with a higher standard of living.  

As with sub option 1a and for the same reasons, this option is 
more complex to apply, however, the complexity is anticipated 
to  increase  because  as  opposed  to  uniformly  applying  a 
standard  co-efficient  across  all  Member  States,  national 
administrations  will  need  to  analyse  in  each  case  whether  the 
relationship between cost of living requires a Member State to 
export  the  national  level  of  benefit  or  whether  a  downward 
adjustment  should  be  applied.  It  is  anticipated  that  these 
procedures  would  fluctuate  along  with  changes  to  the  relative 
cost of living across the EU-28. As per option 1a, it is estimated 
that  the  administrative  tasks  as  primarily  competent  will 
increase by around one man-hour per case (+49%), mainly due 
to the increase in the time devoted to the calculation of benefits 
and  the  reimbursement  activities425  this  will  translate  into  an 
increase in the cost per case (ranging from €0.8 in Romania to 
€58.3 in Denmark). Moreover, a change in the number of cases 
of export of family benefits could also occur as a result of the 
introduction  of  this  option426  -  see  also  mobility  below.  The 
total  cost  will  thus  increase  of  a  sum  ranging  from  €8,700 
(+20%)  in  Romania  to  1,063,500  (+60%)  in  Germany427. 
tasks  as  secondarily  competent,  are  also 
Administrative 

424 Table 14, Annex XIII. 
425 Table 3-1, Annex XVI. 
426 Table 3-3, Annex XVI. 
427 Tables 3-1, 3-2, 3-3 and 3-4, Annex XVI. 

EN 

148 

   EN 

 
 
 
 
 
                                                 
expected to increase by around one man-hour per case (+55%), 
mainly due to the increase in the time devoted to the calculation 
of  benefits,  as  they  become  more  complex:  this  will  translate 
into  an  increase  in  the  cost  per  case  (ranging  from  €1.4  in 
Romania to €58.3 in Denmark).  

As  with  Sub-option  1a,  and  for  the  same  reasons,  this  option 
may increase incentives for fraud while the greater complexity 
may 
thereby 
necessitating  greater  action  by  public  authorities  to  mitigate 
these risks. 

risk  of  administrative  error 

increase 

the 

As  with  option  1a,  this  option  shifts  the  burden  between 
Member States due to the effect of the differential supplement. 
However,  this  option  would  bring  a  financial  relief  for  the 
Member State with a higher factor of adjustment (as they could 
reduce  their  family  benefits  for  children  living  in  Member 
States  with  lower  factors  of  adjustment,  while  Member  States 
with  lower  factors  of  adjustment  would  not  see  any  change  in 
their  situation  in  cases  where  they  have  to  grant  benefits  for 
children  residing  in  Member  States  with  higher  factors  of 
adjustment.  

Like  option  1a,  this  option  could  also  entail  a  moderate 
reduction of mobility flows of the target population (one-earner 
married  persons  who  would  move  without  his/her  family) 
towards  Member  States  with  relatively  higher  cost  of  living. 
For example, in a sample of six Member States, this is expected 
to impact the Netherlands (-4%), Germany (-3.2%), Belgium (-
2.2%),  Spain  (-0.9%)  and  Ireland  (-1.7%),  while  no  increase 
would occur towards Member States with relatively lower cost 
of  living428.  This  would  entail  reductions  (Belgium,  Germany, 
Spain,  Ireland  and  Netherlands)  in  the  budget  devoted  to 
exported family benefits429.  

However,  as  per  option  1a,  another  possible  secondary  effect 
could  also  be  that  dependent  family  members  would  reunite 
with  the  working  partner/parent  working  in  another  (with 
higher living cost) Member States, which, again, would nullify 
the  effects  of  the  option430.  As  stated  above,  this  analysis 
ignores  other  variables  that  may  influence  a  family's  decision 
about  whether  or  not  to  relocate  and  needs  to  be  viewed 
accordingly. 

For the same reasons as Option 1a this option is not considered 
effective  at  achieving  the  General  and  Specific  EU  objectives, 
while  it  may  be  considered  generally  neutral  in  relation  to  the 
wider  EU  objectives,  with  the  exception  of  the  Fresh  Start  to 
address  the  challenges  of  work-life  balance  faced  by  working 
families, where it is considered to be likely to be incoherent 

Risk of fraud and abuse 

- 

Fair  burden 
Member States 

sharing  between 

++/- 

Mobility 

+/- 

Coherence  with  General,  Specific 
and wider EU Objectives 

-- 

Continue the  modernisation of the EU 
Social Security Coordination Rules by 
the  exercise  of 
further  facilitating 
citizens'  rights  while  at  the  same  time 
ensuring 
legal  clarity,  a  fair  and 
equitable  distribution  of  the  financial 
burden  among  the  institutions  of  the 
and 
Member 
and 
administrative 
enforceability of the rules. 

simplicity 

involved 

States 

428 Figure 4.1, Annex XVIII. 
429 Figure 5.1, Annex XVIII. 
430 Pp. 30-31, Annex XVIII. 

EN 

149 

   EN 

 
 
                                                 
• 

• 

• 

Ensure  a  clear  and  transparent 
link  between  the  Member  State 
issuing  family  benefits  and  the 
recipients of those benefits 

barriers 
to 

Remove 
disincentives 
ongoing  participation 
labour market  

or 
parents' 
the 
in 

Ensure 
family  benefits  are 
processed  as  efficiently  as 
possible 

Impacts of Policy Option 2: Member State of Residence of the Child has primary 

7.5.5 
competence 

Policy Option 2:  Member State of Residence of the child always has primary competence 

Social impacts 

Clarification 

++ 

As the Member State which is competent by priority is always 
the Member State of residence of the children, it is clear which 
Member  State  has  to  start  granting  its  benefits  and  means  the 
EU rules are aligned with the residence system in place in the 
majority  of  Member  States.  Many  disputes  which  today’s 
coordination  could  cause  (if  Member  States  do  not  agree  on 
which  Member  State  is  the primarily  competent  one)  could  be 
avoided. 

Simplification 

+ 

Protection of rights 

+ 

On the one hand this option could be regarded as simpler, as it 
is  always  the  same  Member  State  that  primary  competence. 
There  is  also  likely  to  be  a  greater  stability  in  order  of 
competence as the Member State of Residence of the child will 
remain  competent  irrespective  of  the  economic  status  of  their 
parents or the place where the parents work. On the other hand, 
this  option  could 
to  more  cases  with  differential 
supplements than today (if we assume that in general the family 
benefits in Member States to which workers migrate are higher 
than  in  the  Member  State  of  residence  of  the  children)  which 
may  lead  to  ongoing  delays  in  families  receiving  the  full 
entitlement to family benefits even if benefits from the State of 
Residence are processed more rapidly. 

lead 

Families  will  receive  the  same  level  of  benefits  as  under  the 
baseline, but it is expected that benefits which are provided for 
by  the  Member  State  of  residence  will  be  processed  more 
rapidly.  In  residence-based  systems  this  will  ensure  a  greater 
alignment  between  the  normal  rules  for  entitlement  under 
national  legislation  and  the  EU  social  security  rules.  It  also  in 
part responds to the perception of some Member States and EU 
citizens  that  the  State  that  should  have  primary  responsibility 
for paying family benefits is the one where the children reside 
(although  the  obligation  remains  for  the  Member  State  of 
Employment to pay a differential supplement where the level of 
benefits in this State may be higher).  

EN 

150 

   EN 

 
 
 
Financial impact 

+/- 

Impacts on fundamental rights 

0 

Other impacts 

This option will have the effect of shifting the financial burden 
from  the  Member  State  of  work  to  the  Member  State  of 
residence  in  cases  of  export  where  only  one  parent  in  a  EU 
mobile  family  is  economically  active  (in  cases  where  both 
parents  are  economically  active  the  place  of  residence  of  the 
child  already  has  priority  under  the  current  rules).  It  is 
estimated  that,  because  of  a  shift  of  the  expenditure  from  the 
Member State of residence of the worker towards the Member 
State of residence of the children, a decrease of approximately 
€213  million  (approximately  29%)  in  the  expenditure  on 
exported family benefits could occur.431 However, there would 
also  be  an  increase  in  the  expenditure  of  the  Member  State  of 
residence of the child by up to 120%.432 

A case study analysis of the impact on two of the main flows of 
exported  family  benefits  for  which  data  are  available,  notably 
from Luxembourg to France (33% of reported total expenditure 
for  export  of  family  benefits)  and  from  Germany  to  Poland 
(11%  of  reported  total  expenditure  for  export  of  family 
benefits):  the  application  of  this  option  to  these  flows  would 
result  in  a  reduction  in  the  expenditure  for  Luxembourg  (€60 
million) and Germany (€25 million), and an increase in that of 
France (€60 million) and Poland (€25 million)433. 

The  proposed  changes  to  the  rules  of  priority  engages 
consideration  of  the  right  to  equal  treatment  (Article  21),  as  a 
workers in the State of Employment will receive lower benefits 
compared to national workers in that Member State. This  may 
give  rise  to  concerns  about  discrimination  in  particular  in 
relation  to  Member  States  with  either  tax  and  contribution 
based  systems  or  solely  contribution  based  systems.  However, 
there is already precedence for the Member State of Residence 
of  the  Child  to  assume  priority  in  the  case  of  overlapping 
entitlement  on  the  same  basis  (both  in  the  case  of  economic 
activity  and  pension  rights).  This  solution  may  still  be 
considered proportionate in the context of the legitimate aim to 
reduce  accumulation  of  benefits  particularly  as  the  family  will 
receive  the  same  level  of  benefits  overall  and  so  the  right  to 
property (Article 17) and the rights of the child (Article 24) are 
respected.  

431 This estimation is subject to limitation as only 10 Member States were able to provide a breakdown of exported family benefits according 

to primary and secondary competence. 

432 The predictions of increased expenditure by the Member State of residence of the child may be over-estimated as it has not been possible to 
take  into  account  the  existence  of  means-tested  criteria  applied  by  some  family  benefits  in  predicting  the  likely  increase  in  expenditure. 
Annex XIII Table 26. 
433 Figures 8 and 9, Annex XIII. 

EN 

151 

   EN 

 
 
 
 
                                                 
Regulatory Costs 

+/- 

Risk of fraud and abuse 

+ 

Although  not  fully  supported  by  the  qualitative  interviews434 
conducted with national administrations, in general, this option 
is likely to reduce regulatory costs for national authorities as it 
provides greater certainty for which Member State has primary 
competence  and  therefore  takes  away  the  obligation  under  the 
current rules of this Member State to grant provisional benefits 
in the event of dispute of competences.435 This also safeguards 
that not so many cases of recovery of overpayments will occur 
(which  is  often  the  case  today  when  the  final  competence 
differs from the provisional competence and thus overpayments 
have to be recovered (Article 6(5) and Title IV, Chapter III of 
Regulation  (EC)  No  987/2009)  and  which  may  entail 
administrative burden.  

However,  on  the  other  hand,  it  is  anticipated  that  this  option 
may result in more cases of the need to calculate a differential 
supplement than under the current rules (taking into account the 
incentives  for  mobility  from  lower  wage  to  higher  wage 
destinations  of  employment).  Furthermore,  this  option  may 
increase  the  importance  of  verifying  the  child's  place  of 
residence  (currently  only  required  in  cases  of  overlapping 
benefits on the same basis – estimated as being 64% of cases436) 
for both national authorities and citizens.437  

On  the  basis  of  the  interviews  conducted  with  national 
administrations,  it  is  estimated  that  the  administrative  tasks  as 
primarily competent will increase by around one man-hour per 
case (50%).438 This will translate into an increase in the cost per 
case  ranging  from  €0.6  in  Romania  to  €58.3  in  Denmark,  and 
an  increase  of  the  total  cost  ranging  from  €5,600  (+13%)  in 
Romania  to  €642,700  (+37%)  in  Germany439.  Looking  at 
administrative  tasks  as  secondarily  competent,  these  will  also 
increase by  around 0.8  man-hours per  case  (47%),  mainly  due 
to the increase in the time devoted to the calculation of benefits, 
as  it  becomes  more  complex440.  This  will  translate  into  an 
increase in the cost per case ranging from approximately €0.6 in 
Poland  to  €50  in  Denmark,  and  in  an  approximate  increase  of 
the  total  cost  ranging  from  €3,500  (+81%)  in  Romania  to 
€214,800 (+12%) in Germany441.  

The  Member  State  of  residence  will  check  the  family  in  the 
same way as any other family resident there. Usually checking 
and evaluating the situation is easier in the same Member State 
than  abroad  and  also  if  all  residents  are  subject  to  the  same 
checking procedures. Problems experienced under the baseline 
scenario,  where  sometimes  the  work  of  a  parent  in  another 

434 It is acknowledged that there is some tension between the data indicated here and the assessment outlined below . This divergence is a 
consequence  of  the  qualitative  nature  of  the  assessment  and  the fact  the  assessment  was  based  on  the  model  of  a  two  parent family  in 
which  only  one  parent  was  economically  active  rather  than  blended  results  involving  blended  results  from  a  wider  range  of  families 
including with two economically active parents. 
435 Article 60(4) of Regulation (EC) No 987/2009. 
436 Estimation based on EU-28 averages for labour market participation in two adult households with at least one child under 14  
(LFS 2014). 
437  During  the  consultation  of  the  Administrative  Commission  in  June  2015,  five  Member  States  raised  concerns  that  this  may  increase 
administrative  burden  (Cyprus,  Germany,  Netherlands,  Romania  and  Slovakia).  The  FreSsco  legal  experts  have  also  noted  potential 
challenges with determining habitual residence of children Annex VI, p32-33. 
438 Table 3-1, Annex XVI. 
439 Table 3-2, Annex XVI. 
440 Table 3-5, Annex XVI. 
441 Table 3-6, Annex XVI. 

EN 

152 

   EN 

 
 
                                                 
Fair  burden 
Member States 

sharing  between 

+/- 

Mobility 

Coherence  with  General,  Specific 
and wider EU Objectives 

0 

+ 

Continue the  modernisation of the EU 
Social Security Coordination Rules by 
further  facilitating 
the  exercise  of 
citizens'  rights  while  at  the  same  time 
ensuring 
legal  clarity,  a  fair  and 
equitable  distribution  of  the  financial 
burden  among  the  institutions  of  the 
and 
Member 
administrative 
and 
enforceability of the rules. 

simplicity 

involved 

States 

• 

• 

• 

Ensure  a  clear  and  transparent 
link  between  the  Member  State 
issuing  family  benefits  and  the 
recipients of those benefits 

barriers 
to 

Remove 
disincentives 
ongoing  participation 
labour market  

or 
parents' 
the 
in 

Ensure 
family  benefits  are 
processed  as  efficiently  as 
possible 

Member  State  has  not  been  reported  would  no  longer  be  an 
issue, as the Member State of residence is the competent one in 
all cases. 

This  option  shifts  the  burden  in  cases  of  only  one  working 
parent  abroad  from  the  Member  State  of  work  to  the  Member 
State  of  residence.  In  case  of  a  residence-based  scheme  this 
could  be  regarded  as  fairer,  as  already  without  the  Regulation 
all  residents  would  be  entitled  to  the  benefits.  This  would 
change if the State of residence has a contributory scheme and, 
has  to  grant  also  benefits  for  persons  not  contributing  to  the 
scheme.  This  could  result  in  a  certain  disruption  of  the 
economic 
the 
that 
contributions and taxes pays the benefit.  

the  Member  State 

receiving 

logic 

As  this  option  envisages  a  redistribution  of  competence  for 
funding between Member States, with no change in the benefits 
paid to the recipients, it is not envisaged that it would entail any 
mobility change442. 

Option 2 introduces legal clarity and simplicity for families and 
public  administrations  by  establishing  a  closer  alignment 
between  the  EU  rules  and  national  legislation  which  generally 
require  residence  of  a  child  as  a  condition  of  entitlement  for 
family benefits. The rights of families are respected as they will 
receive  the  same  level  of  benefits  as  under  the  current  rules. 
The  rules  create  a  clear  and  transparent  link  between  the 
Member  State  issuing  a  benefit  and  the  families  in  receipt  of 
such  benefits  while  retaining  the  rights  deriving  from  the 
Member State of Employment. However, it may be regarded as 
less  effective  in  achieving  the  general  objective  of  fair  and 
equitable  distribution  of  financial  burden  between  Member 
States  as  the  effect  of  this  option  is  to  redistribute  financial 
burden  away  from  the  Member  State  of  economic  activity 
(which  receives  a  mobile  worker's  tax  and  social  security 
contributions)  towards  the  Member  State  of  Residence.  In 
relation  to  cases  where  national  administrations  are  not 
currently required to investigate residence of the child (cases of 
one  economically  active  parent  one  economically  inactive 
parent) there may be a slight increase in administrative burden 
which  may  in  the  short  term  contribute  to  delays  for  family 
members.  This  option  is  neutral  in  relation  to  wider  EU 
objectives including the Fresh Start to address the challenges of 
work-life balance faced by working families. 

Impacts of Horizontal Policy Option a: Different coordination rules for salary-related 

7.5.6 
child-raising allowances: mandatory derogation from anti-overlapping rules 

Horizontal Option a:  Different coordination rules for salary-related child-raising allowances: mandatory 
derogation from anti-overlapping rules 

Social impacts 

442 Page 25, Annex XVIII. 

EN 

153 

   EN 

 
 
 
 
                                                 
Clarification 

++ 

Simplification 

+ 

Protection of rights 

+/- 

A  parent  claiming  a  child-raising  allowance  will  always  be 
entitled  to  the  full  level  of  benefit  permitted  under  national 
legislation  regardless  of  whether  the  State  where  he  or  she 
works  has  primary  or  secondary  competence  for  family 
benefits.  The  question  of  who  has  entitlement  to  claim  such 
benefits is also clarified as it becomes clear there are no derived 
rights  reducing  the  number  of  disputes  over  this  issue.  This 
provides  greater  clarity  for  parents  and  national  authorities 
compared with the baseline. 

However,  some  parents  may  find  the  application  of  anti-
overlapping  rules  to  the  maximum  duration  of  child-raising 
allowances difficult to understand 

This option is simpler to administer for both parents and public 
authorities compared with the baseline scenario as such benefits 
are no longer subject to the anti-accumulation rules so the level 
of benefit to be awarded will be aligned with calculations under 
national legislation. In addition, the prohibition of claims on the 
basis  of  a  derived  right  will  means  benefits  will  be  calculated 
on the basis of actual salaries or professional income earned in 
the  competent  Member  State.  It  will  no  longer  necessary  to 
undergo a hypothetical assessment of potential earnings in that 
State. 

Under this option, salary-related child raising allowances would 
be exempt from the anti-accumulation rules, thereby having the 
advantage  that  workers  would  not  experience  deductions  from 
entitlement under the applicable legislation of the Member State 
with  secondary  competence  even  if  the  other  parent  was 
receiving similar benefits from the Member State with primary 
competence.  In  such  cases,  parents  may  receive  more  in 
benefits than under the current rules in a manner that removes 
existing 
child-raising 
from 
responsibilities. 

disincentives 

sharing 

However,  this  option  also  provides  that  salary-related  child 
raising allowances would be treated as individual and personal 
rights which may only be claimed by the parent who is subject 
to the applicable legislation in question (not by other members 
of  their  family).  This  may  have  the  consequence  that  some 
parents currently in receipt of such a benefit as a derived right 
would  no  longer  have  entitlement  (although  would  retain 
entitlement to any flat-rate child-raising allowances or flat-rate 
components).  The  maximum  adverse  impact  could  be  up  to 
40% of the number of entitled persons.443  However, as only a 
limited number of Member States are currently complying with 
the  requirement  to  recognise  derived  rights  to  employment-
related  family  benefits444  the  adverse  effects  are  likely  to  be 
limited in practice.  

443 Table 27 Annex XIII – based on a case-study, the number of incoming-cross border workers who live in a household with one other adult 
and at least one child aged less than 15. 
444 Only four Member States who have child-raising allowances recognise claims based on derived rights Annex XXV, p14. 

EN 

154 

   EN 

 
                                                 
Financial impact 

-- 

Member States with secondary competence may be required to 
pay  more  than  under  the  current  rules  because  they  will  be 
required  to  pay  a  salary-related  child-raising  allowance  in  full 
as  they  will  no  longer  be  entitled  to  take  such  benefits  into 
account when calculating the differential supplement.  

In the absence of comprehensive information on exported child-
raising  benefits  from  the  Member  States445,  analysis  has  been 
conducted using ESSPROS data for Member State expenditure 
on  parental  benefits  for  children  aged  0-3.  This  analysis 
suggests  that  this  option  will  lead  to  an  average  increase  in 
expenditure  of  62%  for  those  Member  States  who  provide  a 
child-raising  benefit  calculated  wholly  or  partially  with 
reference to salary or professional income exporting benefits to 
the EU-28 (increasing to an average increase of 81% if only the 
Member States of residence which have an salary-related child-
raising  benefit  are  selected).446 The  extent of the  increase  may 
range  from  37%  (46%)  in  Slovenia  to  210%  (432%)  in 
Sweden.447 It should be noted that this analysis is based on the 
assumption  all  Member  States  concerned  are  fully  complying 
with the EU social security rules and is made with reference to 
ESSPROS  figures  for  parental  benefits  awarded  for  children 
aged 0-3 regardless of whether or not the benefit is indexed to 
salary or professional income or is classified as a family benefit 
for the purposes of the EU social security rules. The estimations 
must be construed in light of these limitations.  

More  widely  it  may  also  be  anticipated  that  excluding  salary-
related  child-raising  allowances  from  the  anti-accumulation 
rules  will  increase  the  level  of  export  for  Member  States  with 
flat-rate child when acting as the secondary competent Member 
State.  Using  the  same  model  of  calculation  the  increase  in 
expenditure  compared  to  the  status  quo  in  this  case  is  on 
average 58% (increasing to an average increase of 84% if only 
the  Member  States  of  residence  which  have  a  salary-related, 
flat-rate or mixed type child-raising benefit are selected).448 

A  case  study  on  export  by  Germany  as  secondary  competent 
Member State of its parental allowance (Elterngeld) to a family 
of  two  working  parents  with  two  children  residing  other 
Member  States  that  also  have  a  salary-related  child-raising 
allowance  assuming  that  such  a  family  is  in  receipt  of  the 
average  personal  net  income  for  that  Member  State  (one  at 
100% and the other at 67% of the average wage) anticipates the 
increase  in  Germany's  expenditure  would  range  from  24%  to 
Poland (increase from €383 to €476) to more than 250% in the 

445 Only four Member States were able to provide a detailed breakdown of levels of export per benefit type including data on child raising 
allowances (Germany, Latvia, Hungary and Romania). 
446Annex XIII Table 24a Average calculated with reference to ESSPROS figures for 13 Member States (Bulgaria, Croatia, Estonia, Finland, 
Germany, Greece, Hungary, Latvia, Lithuania, Romania, Slovenia, Spain and Sweden . No data was available for Austria, Denmark Italy or 
Portugal).  This  analysis  assumes  that  pursuant  to  the  judgment  of  the  CJEU  in  Wiering446  that  a  differential  supplement  should  only  be 
calculated by reference to family benefits "of the same kind" that the secondary competent Member State will only make reference to other 
income-replacement benefits when calculating entitlement to another income-replacement benefit.  
447Annex  XIII  Table  24a  This  analysis  is  based  on  the  assumption  all  Member  States  concerned  are  fully  complying  with  the  EU  social 
security rules and is made with reference to ESSPROS figures for parental benefits awarded for children aged 0-3 regardless of whether or 
not the benefit is indexed to salary or professional income . The estimations must be construed in light of these limitations. 
448  Table  24b  Annex  XIII  Average  calculated  with  reference  to  ESSPROS  figures for  19  Member  States/EEA  States  (Belgium,  Bulgaria, 
Croatia, Czech Republic, Estonia, Finland, France, Germany, Greece, Hungary, Latvia, Lithuania, Luxembourg, Norway, Poland, Romania, 
Slovenia, Spain and Sweden. No data was available for Austria, Denmark Italy or Portugal). 

EN 

155 

   EN 

 
 
 
 
                                                 
Impacts on fundamental rights 

+/- 

Other impacts 

Regulatory Costs 

+/- 

case  of  Austria  (increase  from  €405  to  €1428  paid  to  the 
family).449  

It is also to be envisaged that some Member States may  make 
savings  as  a  result  of  this  option  as  they  will  no  longer  be 
obliged  to  pay  salary-related  child-raising  allowances  on  the 
basis  of  a  derived  rights,  although  once  again  as  a  number  of 
Member  States  do  not  comply  with  the  requirement  to  grant 
salary-related  benefits  on  the  basis  of  derived  rights  the 
anticipated savings in this regard are limited.  

leave.  Exempting 

salary-related  child 

This option offers superior protection in relation to the rights of 
the  family  (Article  33(2))  to  reconcile  family  and  professional 
life by reducing potential disincentives to exercising the right to 
raising 
parental 
allowances from the anti-accumulation rules ensures the right to 
equal  treatment  in  respect  of  such  benefits  as  it  guarantees 
mobile  citizens  working  in  the  Member  State  of  secondary 
competence  would  receive  a  benefit  calculated  in  the  same  as 
national  workers  without  deductions  and  in  a  manner  that 
promotes  the  reconciliation  of  family  and  professional  life. 
Likewise the right to property (Article 17) is also respected in 
relation  to  these  workers.  While  it  is  noted  that  some  parents 
may  lose  entitlement  to  salary-related  child  raising  allowances 
currently awarded as a derived right the rights of the family as a 
whole are protected through the preservation of entitlement for 
the parent with primary entitlement.  

In general, this option is likely to reduce administrative burden 
for national administrations as Member States will be entitled to 
award  salary-related  child-raising  allowances  to  EU  mobile 
citizens subject to the applicable legislation in accordance with 
the normal rules under national legislation. There will no longer 
be a requirement to include such benefits (which can be subject 
to  fluctuation  according  to  earnings)  within  the  calculation  of 
the differential supplement nor would there be a need to apply a 
hypothetical  calculation  in  relation  to  a  parent  who  does  not 
have relevant income or earnings within the competent Member 
State but who asserts a derived right to benefits. 

However, it may be anticipated that there will be some increase 
in  administrative  tasks  for  Member  States  who  seek  to  verify 
whether  or  not  a  benefit  available  in  another  Member  State 
should be considered a salary-related child-raising allowance or 
who  wish  to  exchange  information  about  entitlement  to  or 
claims  for  salary-related  child-raising  allowance  for  the  other 
parent  in  another  Member  State  for  the  purposes  of  applying 
anti-accumulation  principles  to  the  duration  of  a  benefit.  This 
will also entail additional administrative tasks for citizens. 

As this option was developed after commissioning the analysis 
of regulatory costs at the time of drafting this report it has not 
possible to draw direct comparisons with the baseline scenario 
in the same manner as with Options 1a, 1b and 2. 

449Table 25 Annex XIII. 

EN 

156 

   EN 

 
 
                                                 
Risk of fraud and abuse 

+ 

Fair  burden 
Member States 

sharing  between 

+/- 

Mobility 

+ 

Coherence  with  General,  Specific 
and wider EU Objectives 

++ 

Continue the  modernisation of the EU 
Social Security Coordination Rules by 
further  facilitating 
the  exercise  of 
citizens'  rights  while  at  the  same  time 
ensuring 
legal  clarity,  a  fair  and 
equitable  distribution  of  the  financial 
burden  among  the  institutions  of  the 
and 
Member 
administrative 
and 
enforceability of the rules. 

simplicity 

involved 

States 

• 

• 

• 

Ensure  a  clear  and  transparent 
link  between  the  Member  State 
issuing  family  benefits  and  the 
recipients of those benefits 

barriers 
to 

Remove 
disincentives 
ongoing  participation 
labour market  

or 
parents' 
the 
in 

Ensure 
family  benefits  are 
processed  as  efficiently  as 
possible 

Removal  of  derived  rights  is  likely  to  reduce  the  risk  of  fraud 
and  abuse  as  Member  States  will  be  able  to  assess  and  verify 
entitlement to salary-related child raising allowances according 
to  their  national  legislation  and  normal  procedures.  However, 
there will be a need to establish clear policies and procedures to 
ensure  exchanges  of  information  to  assess  the  other  parent's 
entitlement  to  a  benefit  in  order  to  apply  anti-accumulation 
principles to the duration of a benefit. 

This  option  shifts  the  burden  in  cases  child-raising  allowances 
to the Member State of work as benefits will be required to be 
paid  in  full  and  for  the  maximum  duration  permitted  under 
national legislation (except in cases where there is simultaneous 
entitlement  in  another  Member  State  meaning  increases  to 
duration  may  be  limited).  However,  such  a  change  in  burden 
may  be  considered  consistent  with  the  economic  logic  that 
assigns the obligation to pay the family benefits to the Member 
State receiving the contributions and taxes. 

This option may have a slight impact on mobility by removing 
potential  disincentives  for  parents  to  move  to  a  different 
Member  State  because  of  the  risks  that  a  change  in  primary 
competence  may  have  a  negative  impact  on  the  level  of  their 
salary-related child-raising allowances.450 As noted above there 
are a range of variables that may influence a family's decision 
about whether or not to relocate and this prediction needs to be 
viewed accordingly. 

As this option was developed after commissioning the analysis 
of regulatory costs at the time of drafting this report it has not 
possible  to  draw  direct  comparisons  with  the  status  quo  in  the 
same manner as with Options 1a, 1b and 2. 

for  EU 

transnational 

to  share  child-raising 
responsibilities 
labour  market  participation.  Other 

The horizontal options provide greater protection for mobile EU 
parents  in  the  field  of  child-raising  allowances  (calculated  by 
reference to salary/professional income). In general, exempting 
these  benefits  from  the  application  of  derived  rights  and  the 
anti-accumulation  rules  is  likely  to  remove  disincentives  for 
increasing 
parents 
  potential 
ongoing 
disadvantages 
families  concerning 
duration of a right to benefit are also mitigated (with safeguards 
to  protect  over-compensation  of  families).  This  option  is  also 
likely  to  decrease  regulatory  costs  for  public  authorities  in 
administering these benefits by removing the need to calculate 
the differential supplement and calculate claims on the basis of 
derived rights increasing administrative simplicity and reducing 
delays for families in processing claims.  By preventing claims 
on  the  basis  of  derived  rights  to  be  made  in  respect  of  family 
benefits  intended  to  replace  an  individual  worker's  income 
during periods of child-raising the aim of achieving a clear and 
transparent  link  between  the  Member  State  issuing  the  benefit 
and  the  recipient  is  achieved.  Although  there  may  be  an 
increase  in  the  economic  costs  for  secondary  competent 

450 It is to be noted that the Nordic Council of Ministers identified the inconsistent treatment of parental benefits in the Nordic countries 
and the application of the anti-accumulation rules to such benefits as a potential cross-border barrier Nordic Council of Ministers, 2012 
Freedom of Movement within the Social- and Labour market Area in the Nordic Countries: Summary of obstacles and potential solutions. 

EN 

157 

   EN 

 
                                                 
Member States, such an increase is aligned to costs that would 
otherwise  be  incurred  under  national  legislation.  This  option 
supports  the  wider  EU  objectives  including  in  relation  to  the 
Fresh Start on maternity and parental leave.  

Impacts of Horizontal Policy Option b: Different coordination rules for all child-

7.5.7 
raising allowances: mandatory derogation from anti-overlapping rules 

Horizontal Option b:  Different coordination rules for all child-raising allowances (salary-related and flat 
rate): mandatory derogation from anti-overlapping rules 

Social impacts 

Clarification 

Simplification 

Protection of rights 

Financial impact 

++ 

+ 

+/- 

-- 

Impacts on fundamental rights 

+/- 

The impact would be the same as horizontal option a, although 
the  advantages  would  be  greater  as  this  would  apply  to  all 
child-raising allowances (both salary-related and flat rate) 

The impact would be the same as horizontal option a, although 
the  advantages  would  be  greater  as  this  would  apply  to  all 
child-raising allowances. 

The impact would be the same as horizontal option a, although 
the  costs  and benefits  would  be greater  as this  would  apply  to 
all child-raising allowances. 

The financial impact is similar to horizontal option a, however, 
the  number  of  Member  States  affected  and  the  range  of 
economic costs is likely to be greater as a result of the extension 
to all child-raising allowances.  

Based  on  ESSPROS  data  for  Member  State  expenditure  on 
parental benefits it may be anticipated that this option will lead 
to an average increase in expenditure for secondary competent 
Member States with child-raising allowances of 58% exporting 
benefits to the EU-28 (increasing to an average increase of 84% 
if  only  the  Member  States  of  residence  which  have  an  salary-
related, flat rate or mixed child-raising benefit are selected).451  

The  extent  of  the  increase  may  range  from  32%  (43%)  in 
Luxembourg to 210% (474%) in Sweden.452  

The impact would be the same as horizontal option a, although 
the  impact  would  be  greater  as  this  would  apply  to  all  child-
raising allowances 

Other impacts 

Regulatory Costs 

+/- 

The impact would be the same as horizontal option a, although 
the anticipated reduction in regulatory burden would be greater 

451Annex  XIII  Table  24b  Average  calculated  with  reference  to  ESSPROS  figures  for  19  Member  States/EEA  States  (Belgium,  Bulgaria, 
Croatia,  Czech  Republic,  Estonia,  Finland,  France,  Germany,  Greece,  Hungary,  Latvia,  Lithuania,  Luxembourg,  Norway,  Poland, 
Romania, Slovenia, Spain and Sweden . No data was available for Austria, Denmark Italy or Portugal). 

452Annex  XIII  Table  24b  This  analysis  is  based  on  the  assumption  all  Member  States  concerned  are  fully  complying  with  the  EU  social 
security rules and is made with reference to ESSPROS figures for parental benefits awarded for children aged 0-3 regardless of whether or 
not the benefit is indexed to salary or professional income . The estimations must be construed in light of these limitations. 

EN 

158 

   EN 

 
 
 
 
 
 
                                                 
Risk of fraud and abuse 

+ 

as  this  would  apply  to  all  child-raising  allowances  (and 
conversely the scope of additional administrative tasks to verify 
duration of leave taken in another Member State could increase 
for both national authorities and citizens) 

The impact would be the same as horizontal option a, although 
the  advantages  would  be  greater  as  this  would  apply  to  all 
child-raising allowances 

Fair  burden 
Member States 

sharing  between 

+/- 

The impact would be the same as horizontal option a, although 
the  benefits  would  be  greater  as  this  would  apply  to  all  child-
raising allowances. 

Mobility 

+ 

The impact is likely to be similar to horizontal option a 

Coherence  with  General,  Specific 
and wider EU Objectives 

++ 

Continue the  modernisation of the EU 
Social Security Coordination Rules by 
further  facilitating 
the  exercise  of 
citizens'  rights  while  at  the  same  time 
ensuring 
legal  clarity,  a  fair  and 
equitable  distribution  of  the  financial 
burden  among  the  institutions  of  the 
and 
Member 
administrative 
and 
enforceability of the rules. 

simplicity 

involved 

States 

For the same reasons as horizontal option a this option may be 
considered  effective  at  achieving  the  General  and Specific  EU 
objectives and also the wider EU objectives, the Fresh Start to 
address  the  challenges  of  work-life  balance  faced  by  working 
families.  Further,  as  this  horizontal  option  encapsulates  both 
salary-related and flat rate child-raising allowances it is slightly 
more effective at achieving these aims. 

• 

• 

• 

Ensure  a  clear  and  transparent 
link  between  the  Member  State 
issuing  family  benefits  and  the 
recipients of those benefits 

barriers 
to 

Remove 
disincentives 
ongoing  participation 
labour market  

or 
parents' 
the 
in 

Ensure 
family  benefits  are 
processed  as  efficiently  as 
possible 

Impacts of Horizontal Policy Option c: Different coordination rules for all child-

7.5.8 
raising allowances: optional derogation from anti-overlapping rules 

Horizontal Option c:  Different coordination rules for all child-raising allowances (salary-related and flat 
rate): optional derogation from anti-overlapping rules 

Social impacts 

Clarification 

Simplification 

+/- 

+ 

The  impact  would  be  the  similar  to  horizontal  option  b, 
although  the  effects  would  be  mixed  depending  on  whether  a 
member state chooses to disapply the anti-accumulation rules or 
not. Some citizens may find this confusing. 

The  impact  would  be  the  similar  to  horizontal  option  b, 
although  the  effects  would  be  mixed  depending  on  whether  a 
Member  State  chooses  to  disapply  the  anti-accumulation  rules 
or not. Some citizens may find this confusing. 

EN 

159 

   EN 

 
 
 
 
Protection of rights 

+/- 

Financial impact 

-- 

Impacts on fundamental rights 

+/- 

Other impacts 

Regulatory Costs 

+/- 

The  impact  would  be  the  similar  to  horizontal  option  b, 
although  the  effects  would  be  mixed  depending  on  whether  a 
member state chooses to disapply the anti-accumulation rules or 
not. In addition, as this option does not envisage a measure to 
ensure that where only one parent in a family is subject to the 
legislation of a Member State, that parent shall be able to claim 
the  allowances  for  the  maximum  duration,  some  mobile 
families may face disadvantages in national systems which are 
designed to incentivise parents to share child-raising allowances 
by  limiting  the  duration  that  an  individual  parent  can  claim  a 
benefit.  

The maximum impact would be the similar to horizontal option 
b,  although  it  may  be  anticipated  that  not  all  Member  States 
will choose to derogate from the anti-overlapping rules. In cases 
where there is no derogation there will be no change from the 
baseline. 

The  impact  would  be  the  similar  to  horizontal  option  b, 
although  the  effects  would  be  mixed  depending  on  whether  a 
Member  State  chooses  to  disapply  the  anti-accumulation  rules 
or not 

The  impact  would  be  the  similar  to  horizontal  option  b, 
although  the  effects  would  be  mixed  depending  on  whether  a 
member state chooses to disapply the anti-accumulation rules or 
not. However, no additional administrative tasks are envisaged 
under this option as competent authorities will not be required 
to exchange information about the duration of claim for child-
raising allowances taken by a parent in another Member State. 

This will also not entail any additional administrative tasks for 
citizens. 

Risk of fraud and abuse 

+ 

The impact would be the similar to horizontal option b. 

Fair  burden 
Member States 

sharing  between 

+/- 

The maximum impact would be the similar to horizontal option 
b,  although  it  may  be  anticipated  that  not  all  Member  States 
will choose to derogate from the anti-overlapping rules. 

Mobility 

Coherence  with  General,  Specific 
and wider EU Objectives 

Continue the  modernisation of the EU 
Social Security Coordination Rules by 
further  facilitating 
the  exercise  of 
citizens'  rights  while  at  the  same  time 
ensuring 
legal  clarity,  a  fair  and 
equitable  distribution  of  the  financial 
burden  among  the  institutions  of  the 
and 
Member 
administrative 
and 
enforceability of the rules. 

simplicity 

involved 

States 

0 

+/- 

No material impact on mobility is anticipated as a result of this 
measure. 

This option has the potential to be just as effective at achieving 
the General and Specific EU objectives and also the wider EU 
objectives, the Fresh Start to address the challenges of work-life 
balance  faced  by  working  families  as  horizontal  option  b  with 
slightly increased simplicity as it does not entail any additional 
administrative  tasks,  meaning  it  is  even  more  simple  to  apply. 
However, as the derogation from the anti-accumulation rules is 
optional rather than mandatory in practice it is likely to be less 
effective  at  achieving  the  goals  and  the  problems  identified 
concerning disincentives to ongoing labour market participation 
may continue to subsist. 

• 

Ensure  a  clear  and  transparent 
link  between  the  Member  State 
issuing  family  benefits  and  the 

EN 

160 

   EN 

 
 
 
 
 
recipients of those benefits 

• 

• 

barriers 
to 

Remove 
disincentives 
ongoing  participation 
labour market  

or 
parents' 
the 
in 

family  benefits  are 
Ensure 
processed  as  efficiently  as 
possible 

7.5.9  Conclusions 

Based on the above tables, the following preliminary conclusions can be drawn. 

The baseline scenario, from a merely administrative point of view, is the easiest option to implement 
and it has the support of a large number of stakeholders. It also offers the same or superior levels of 
protection  to  workers  and  their  families  as  the  other  options.  This  option  maintains  a  clear  and 
transparent  link  between  the  Member  State  issuing  a  benefit  and  the  place  where  a  mobile  worker 
pays  taxes  and  social  security  contributions.  It  is  anticipated  in  light  of  the  launch  of  EESSI  and 
implementation of Decision F2 that efficiency and effectiveness of processing family benefit claims 
will also be increased. 

Option 1a and 1b may be the most effective options in achieving a greater correlation between family 
benefits and the cost of living, however, they do not fully achieve the aim of maintaining a clear and 
transparent  link  between  the  Member  State  issuing  a  benefit  and  the  families  in  receipt  of  such 
benefits  as  mobile  workers  as  the  transparency  of  the  award  of  family  benefits  will  be  reduced 
compared to the baseline particularly in relation to employment-related benefits. These options may 
increase rather than reduce disincentives to parents' ongoing participation in the labour market during 
periods of child-raising leave in the field of child-raising allowances related to salary or professional 
income  as  such  benefits  will  not  only  be  subject  to  the  anti-accumulation  rules  but  also  subject  to 
reductions  based  on  place  of  residence  of  the  child.  They  may  also  increase  delays  in  processing 
family  benefits.  Workers  and  their  families  will  generally  be  provided  with  an  inferior  level  of 
protection compared to the status quo (in particular in relation to option 1b) as workers will receive 
lower level of family benefits than nationals notwithstanding the fact they pay the same level of tax 
and social security contributions. Therefore not withstanding the potential cost savings (particularly in 
the  case  of  option  1b)  these  considerations  these  options  are  not  considered  the  most  effective  at 
achieving the objectives and therefore are not the most efficient options. 

Option 2 introduces legal clarity and simplicity for families and public administrations by establishing 
a closer alignment between the EU rules and national legislation which generally require residence of 
a child as a condition of entitlement for family benefits. However, it may be regarded as less effective 
in  achieving  the  general  objective  of  fair  and  equitable  distribution  of  financial  burden  between 
Member States as the effect of this option is to redistribute financial burden away from the Member 
State  of  economic  activity  (which  receives  a  mobile  worker's  tax  and  social  security  contributions) 
towards the Member State of Residence. The rights of families are respected as they will receive the 
same level of benefits as under the current rules although there may be a moderate budgetary impact 
for those Member States which currently have secondary competence for family benefits in particular 
those that do not currently have to pay the differential supplement because the level of family benefits 
in  the  primary  competent  Member  State  is  higher.  In  cases  where  there  is  only  one  economically 
active  parent,  the  increase  in  economic  burden  for  the  Member  State  of  residence  of  the  child  and 
away from the Member State of employment is contrary to the relative distribution of taxes and social 
security  paid  by  the  family  to  these  Member  States.  Therefore  although  in  many  respects  this  is  an 
effective option, in light of the anticipated increase in costs for the Member State of residence of the 
child it is not the most efficient.  

Horizontal option  

EN 

161 

   EN 

 
 
 
The horizontal options provide greater protection for mobile EU parents in the field of child-raising 
allowances (either calculated by reference to salary/professional income or all types of such benefit), 
and by exempting these benefits from the application of derived rights and the anti-accumulation rules 
will  also  decrease  regulatory  costs  for  public  authorities  in  administering  these  benefits  and  reduce 
delays  for  families  in  processing  claims.  By  preventing  claims  on  the  basis  of  derived  rights  to  be 
made in respect of family benefits intended to replace an individual worker's income during periods of 
child-raising the aim of achieving a clear and transparent link between the Member State issuing the 
benefit  and  the  recipient  is  achieved.  These  options  will  entail  a  significant  economic  impact  for 
Member  States  as  by  disapplying  the  anti-accumulation  rules,  Member  States  with  secondary 
competence will experience an increase in expenditure of on average increase of 62-81% in relation to 
Horizontal Option a and 58-84% for Horizontal Option b. This financial impact may be mitigated by 
allowing Member States to derogate from the anti-overlapping rules on an optional basis although this 
option is less effective at  reducing disincentives to labour market participation. There is therefore  a 
trade-off between cost and effectiveness. The risk of a loss of protection for parents currently relying 
on derived rights to such benefits is assessed as low due to the current low levels of compliance with 
the  existing  EU  law  requirement  to  award  family  benefits  calculated  with  reference  to  salary  or 
professional income on the basis of a derived right.  

EN 

162 

   EN 

 
 
8.  Overall Conclusion 

The key policy objective of this initiative is to continue the modernisation of the EU Social 
Security Coordination Rules by further facilitating the exercise of citizens' rights while at the 
same  time  ensuring  legal  clarity,  a  fair  and  equitable  distribution  of  the  financial  burden 
among  the  institutions  of  the  Member  States  involved  and  administrative  simplicity  and 
enforceability of the rules.  

This initiative serves to facilitate the exercise of the right to free movement by ensuring the 
social security coordination is effective and efficient and therefore does not act as a deterrent 
to free movement. It is in the interests of all parties to design co-ordination rules that allow 
full exercise of rights of citizens whilst ensuring coordination requirements for both citizens 
and Member States are clear and transparent and thereby easy to apply and enforce.  

Achieving greater clarity over the social security coordination system is an important step to 
face  the  challenges  and  controversies  that  exist  over  intra-EU  mobility  and  to  address 
demographic challenges ahead of us. 

Achieving a system of social security coordination that responds to the social and economic 
reality in Member States has been one of the central drivers for the Commission to continue 
the modernisation process of social security coordination that started more than a decade ago.  

It  is  important  the  rules  are  fair  (in  particular  in  relation  to  the  relative  balance  of 
responsibility  between  Member  States  who  receive  or  have  received  social  security 
contributions  and  the  obligation  to  pay  benefits)  and  that  perceptions  of  unfairness  are 
properly investigated so that they can be addressed where such views are well grounded but 
challenged where a perception is misplaced. Further the rules should be efficient in terms of 
cost, administrative burden and risk of fraud or administrative error.  

Finally the rules should be effective in relation to meeting the overall goals of coordination in 
particular  safeguarding  the  continuity  of  social  security  protection  as  citizens  move  from 
from one Member State to another. 

This  report  has  carefully  reviewed  the  existing  rules,  taking  into  account  the  views  of 
stakeholders to identify actions that may be necessary to achieve this overall objective. This 
impact assessment report has considered the impact of possible improvements to the rules in 
four distinct areas: 

•  Long-term care benefits 
•  Unemployment benefits 
•  Access to social benefits for economically inactive mobile EU citizens 
•  Family benefits 

EN 

163 

   EN 

 
 
In  each  area,  the  Report  has  identified  a  number  of  policy  options  to  address  the  problems 
identified outlined below against the baseline (preferred options identified in yellow). 

Overview of Options Per Area 

Long Term Care Benefits 

Baseline: No specific provisions 
long-term  care  benefits. 
for 
Competent  Member 
State 
provides  long-term  benefits  in 
cash  and  reimburses  the  cost 
of  benefits  in  kind  provided  by 
the Member State of residence 

long-term 

Option  1:  The  competent  Member 
care 
State  provides 
benefits in cash and reimburses the 
cost of benefits in kind provided by 
the  Member  State  of  residence. 
New  definition  of  LTC  benefits  to 
facilitate coordination√ 

in 

kind) 

Option 2a : Member State of 
residence  provides  all  long-
term  care  benefits  (in  cash 
with 
and 
reimbursement 
the 
competent State, at the level 
of  the  state  of  residence 
without  supplement  by  the 
competent Member State 

by 

Option  2b:  As  option  2a,  but  with 
supplement  by  competent  Member 
State 

Aggregation 
Periods 

of 

of 

Export 
Unemployment 
Benefits 

Rules  for  cross-
border workers 

No

period
for

Baseline: 
minimum 
insurance 
to 
qualify 
aggregation. 
Divergent 
approach  between
MS. 

Baseline: 
Export
for  3  months  with
to
option 
the 
extend 
6
to 
months. 

frontier
Baseline: 
receive
workers 
UBs 
in  Member
State  of  residence.
All  other  wholly
unemployed 
persons 
receive
UBs  from  Member
State 
last
of 
activity. 

Unemployment Benefits 

Option  1: 
formalisati
on  of  one-
day rule 

2a 

: 
Option 
introduction 
of 
minimum  insurance 
requirement  of  1 
month 

Option 2b: 
introduction of 
minimum insurance 
requirement of 3 
months√ 

3a 

: 
Option  3b:  taking 
Option 
account  of  previous 
taking account of 
having 
earnings 
previous 
been 
less 
insured 
earnings  having 
than 3 months 
insured 
been 
less 
1 
month 

than 

Option  1:  Extend  period  of  export 
of  UB  to  minimum  6  months  and 
possibility of further extension √ 

Option  2:  Extend  period  of  export  of  UB  for  duration  of 
entitlement 

Option  2a:  state  of 
last activity pays UB, 
and  frontier  worker 
registers there 

Option  1: 
frontier 
worker 
chooses 
where 
claim 

to 

2b: 
Option 
last 
state  of 
pays 
activity 
frontier 
UB, 
worker 
can 
choose  where 
to register 

Option  3a  :  state  of 
activity  only 
last 
pays 
after 
UB 
sufficient (at least 12 
months) 
work 
history  and  frontier 
worker 
registers 
there√ 

UB 

Option  3b:  state  of 
activity  only 
last 
after 
pays 
sufficient 
work 
history  and  frontier 
chooses 
worker 
where to register 

Access for economically inactive persons and jobseekers to social benefits 

Option  1a  Dynamic 
reference 
to 
Directive 
2004/38/EC in equal 
treatment 
provisions √ 

Baseline: Economically 
inactive 
mobile 
citizens  have  no  right 
to  benefits  for  first  3 
3 
months. 
months 
if 
(i)Sufficient 
resources(ii) 
Comprehensive 
sickness coverage 

After 
only 

Export  of  Family 
Benefits 

Baseline: 
Family
benefits  payable  in  full
by  Member  State  of
for
Work 
children 
in
another Member State. 

including 
living 

Option 
Specific 
1c 
Reference  to  Directive 
2004/38/EC (SNCBs) 

2: 
Option 
Removing  SNCBs 
providing 
subsistence  from 
Regulation 
(EC) 
No 883/2004 

3:

Option 
Administrative 
on 
guidance 
interpretation  of 
Regulation  (EC)  No 
883/2004 

Option  1b  Amendment  of 
Article 4 of Regulation (EC) 
No  883/2004  to  make  a 
dynamic  reference  to  the 
equal 
limitations 
treatment 
in  Directive 
2004/38/EC  and  to  extend 
these 
by 
analogy 
tax-
financed benefits 

limitations 
to  other 

to 

Family Benefits 

Option 1a: Adjustment to 
standards 
living: 
upwards and downwards 

of 

Option  1b:  Adjustment  to 
standards  of 
living:  only 
downwards 

Option  2:  Member  State  of 
residence has primary competence

EN 

164 

   EN 

 
 
Horizontal 
Option: 
raising 
allowances 

Child-

have 

Family
Baseline: 
Members 
a
derived  right  to  family
benefits. 
Anti-
overlapping rules apply. 

rights 

Horizontal  Option 
individual 
salary-related 
raising 
mandatory 
from 
rules 

a: 
for 
child-
allowances: 
derogation 
anti-overlapping 

rights 

Option 

b: 
Horizontal 
for  all 
Individual 
allowances: 
child-raising 
mandatory 
derogation 
from anti-overlapping rules 

individual 
Horizontal  Option  c: 
rights 
child-raising 
all 
for 
allowances:  optional  derogation 
from anti-overlapping rules 

√ 

Each of these options has been assessed in relation to their social, economic and regulatory 
impact as well as their effectiveness and efficiency in meeting the general and specific policy 
objectives. An overview of the impact in relation to the preferred options is set out below: 

Table - overview of impact of preferred options (impacts grouped per objective) 

General Objective 

Facilitate  the  exercise 
of citizens' rights  

Ensure legal clarity and 
transparency 
for 
citizens, 
institutions 
and other stakeholders 
on  coordination  rules 
applicable to them 

a 

fair 

and 
Ensure 
equitable  distribution  of 
the 
burden 
between Member State  

financial 

Ensure 
simplicity 
enforceability of the rules 

administrative 
and 

Relevant Impact 

-Protection of rights 

-Clarification 

-Financial impact 

-Simplification 

Long-term care 
benefits 

The competent 
Member State 
provides long-term 
care benefits in cash 
and reimburses the 
cost of benefits in kind 
provided by the 
Member State of 
residence 

-Fair burden sharing 

-Regulatory Costs 

-Risk of fraud and abuse 

+ 

++ 

0 

+ 

The 
inclusion  of  a 
common  definition  for 
long-term  care  benefits 
and  uniform  criteria  for 
these 
classifying 
benefits  will 
bring 
clarity  and  consistency 
to the system. 

subject 

Receipt  of  benefits  will 
remain 
to 
national  conditions  of 
entitlement  and  so  a 
move 
another 
to 
Member  State  may  be 
more 
less 
or 
advantageous 
depending 
the 
allocation  of  benefits  in 
in  the 
kind  and  cash 
Member 
States 
concerned. 

on 

This  option  takes  into 
account 
specific 
the 
characteristics  of  long-
care  benefits, 
term 
distinguishing 
them 
from  sickness  benefits 
and  other  branches  of 
social  security,  while 
maintaining the current 
method 
of 
coordination. 

No  significant  economic 
impact  in  comparison  to 
the  baseline  is  foreseen 
as  the  same  rules  will 
continue to apply.  

No  fundamental  changes 
in  burden  sharing,  but 
not 
benefits 
some 
currently  coordinated  as 
Long-Term  Care  Benefits 
could  become  subject  to 
the rules. This may lead to 
some  additional  cases  of 
also 
export, 
contribute 
greater 
efficiencies  by  avoiding 
duplication 
the 
allocation of benefits. 

but 
to 

in 

for 

citizens 

it 
The  option  will  make 
easier 
to 
identify and understand the 
the 
application 
coordination  provisions  on 
national 
care 
benefits.  

long-term 

of 

Information  obligations  for 
national 
administrations 
will  remain  the  same  as 
under 
baseline 
the 
scenario.  

The  option  facilitates  the 
comparison  of  benefits  in 
kind  and  in  cash  and  could 
lead  to 
fewer  cases  of 
duplication  and  also  fewer 
between 
disputes 
institutions 
concerning 
reimbursement. 

Unemployment 
benefits: Aggregation 

introduction 
minimum 
requirement 
months 

of 
insurance 
3 
of 

+ 

+ 

++ 

++ 

No  substantive  loss  of 
Approximately 
rights. 
EU 
10,082  mobile 
receive 
workers  will 
of 
export 

Improved  clarity  of  the 
EU 
on 
rules 
aggregation, elminating 
divergent 
interpretations 

increase 
for 

of 
Slight 
expenditure 
the 
Member State of previous 
employment, 
but 
corresponding  decrease 

A uniform interpretation of 
the  rules  on  aggregation 
to 
contribute 
will 
simplifying  the  aggregation 
procedure.  

EN 

165 

   EN 

 
 
 
 
  
 
 
unemployment  benefits 
from  the  Member  State 
of 
activity 
instead of the last State 
of activity.  

previous 

between 
States. 

Member 

of 
on 
expenditure 
unemployment  benefits 
for Member States of last 
activity.  Overall  decrease 
of expenditure amounting 
to  approximately  €  29 
million is expected.  

A  clearer  link  between  the 
award  of  benefits  and 
contributions 
paid 
diminishes 
risk  of 
the 
random results. 

Overall regulatory costs will 
remain unchanged. 

Unemployment 
benefits: Export 

+ 

+ 

+

0 

About  24,000  persons 
will  have  the  possibility 
to  retain  their  rights  to 
unemployment  in  case 
of job search in another 
Member  State 
for  a 
period  of  six  instead  of 
three months.  

for 

Clearer  and  uniform 
standards 
all 
persons wishing to take 
unemployment 
their 
benefits  with 
them 
when  looking  for  a  job 
in  another  Member 
State. 

the 
The  extension  of 
is  not 
export  period 
to  have  any 
expected 
financial 
significant 
impact  on  the  Member 
States, either at individual 
or  aggregate  level,  as  it 
only maintains an existing 
right  to  unemployment 
in  case  of  job 
benefits 
search 
another 
Member State. 

in 

Extended  export  reduces 
the  risk  that  a  jobseeker 
has  to  rely  on  welfare 
benefits  from  the  host 
Member State.  

Clear  and  uniform  rules 
regarding  the  expot  period 
will  simplify  the  procedure 
for  citizens  and  national 
administrations. 

introduction  of  a 
The 
reinforced 
cooperation 
mechanism  will  reduce  the 
risk  of  fraud  and  abuse  by 
ensuring that the jobseeker 
subject 
remains 
to 
supervision 
the  host 
in 
State  and  so  cases  of  non-
compliance  with  activation 
measures may be detected.  

+ 

+ 

+/- 

++ 

Clear and uniform rules 
for  frontier  and  other 
cross-border workers 

This option will result in 
in 
greater  consistency 
the 
of 
treatment 
frontier and other cross-
border workers. 

an 

It  will  also  contribute 
towards 
even 
link  between 
stronger 
benefits 
and 
contributions,  creating 
better  chances  for  the 
worker  to  reintegrate 
into labour market. 

Across  the  EU-28,  there 
will  be  an  increase  of  6% 
of  the  overall  expenses 
unemployment 
for 
benefits 
from  €  416 
million  to  €  442  million. 
This  is  because  frontier 
workers  tend  to  work  in 
countries  with  (on  the 
average)  higher  wages 
and higher benefits. 

It contributes to a shift in 
burden  sharing  as  the 
cost 
the 
of 
unemployment  benefits 
will  be  reallocated  in  a 
way  that  is  proportionate 
to  level  of  contributions 
or income tax received.  

Clear  and  uniform  rules  for 
frontier  and  other  cross-
border workers will simplify 
administrative 
the 
procedure 
thus 
facilitate  enforcement  of 
existing rules for citizens. 

and 

are 

information 
Additional 
exchanges 
needed 
between the Member State 
of last activity and the State 
of  residence  as  regards  the 
reference  period  of  12 
in 
months. 
However, 
the 
combination  with 
the 
annulment 
reimbursement  procedure, 
this  option  has  an  overall 
on 
positive 
administrative  burden 
(-
50%). 

impact 

of 

+ 

+ 

0 

+ 

of 
of 

period 

Extend 
export 
Unemployment 
Benefits  to  minimum 
period  of  6  months 
and 
of 
possibility 
further  extension  for 
whole 
of 
entitlement. 

period 

Unemployment 
benefits: 
Workers 

Frontier 

State  of  last  activity 
pays 
only 
Unemployment 
Benefits 
after 
sufficient  (at  least  12 
months)  work  history 
frontier  worker 
and 
registers 
there.  The 
current 
reimbursement 
procedure 
abolished.  

is 

Access 
for 
economically  inactive 
persons 
and 
jobseekers  to  social 
benefits 

Dynamic  reference  to 
Directive  2004/38/EC 
treatment 
in  equal 
provisions 
& 
Commission guidance 

Greater  uniformity 
in 
the  application  of  rules 
by  Member  States  and 
the  ability  of  citizens  to 
rights 
their 
enforce 

codification 

of 
The 
existing 
case-law 
combined  with  clear 
guidance  would  clarify 
the rights of EU mobile 

No  direct 
impact  on 
Member  States'  budgets 
as  this  measure  simply 
reflects codification of the 
case-law of the Court. 

be 

It 
will 
straightforward 
rights and obligations. 

more 
to  verify 

 Costs  related  to 
legal  certainty 

lack  of 
for  both 

EN 

166 

   EN 

 
 
 
 
 
 
 
thanks to more clarity in 
the  application  of  the 
CJEU  case  law,  leading 
to 
legal 
certainty.  

greater 

informed 

citizens 
and  would 
enable citizens to make 
an 
choice 
when  exercising  their 
rights 
to 
another Member State.  

to  move 

No  direct  impact  on  the 
financial 
distribution  of 
burden between Member 
States. 

citizens 
authorities 
reduced 

and 

could 

public 
be 

to 

Greater  visibility 
the 
existing  safeguards  in  EU 
"welfare 
law 
tourism"  may  act  as  a 
deterrent to such conduct. 

against 

Export of Family 
Benefits 

Baseline: 
Family 
benefits payable in full 
by  Member  State  of 
for 
Work 
in 
children 
Member 
another 
State. 

including 
living 

Horizontal Option: 
Child-Raising 
Allowances 

Different  coordination 
for  all  child-
rues 
allowances: 
raising 
optional 
derogation 
from  anti-overlapping 
rules 

0 

N/A 

0 

N/A 

0 

N/A 

0 

N/A 

+/- 

+/- 

- 

+ 

The  removal  of  derived 
rights  is  likely  to  reduce 
administrative  burden  and 
the  risk  of  fraud  and  abuse 
as  Member  States  will  be 
able  to  assess  and  verify 
entitlement  to  child  raising 
to 
allowances  according 
their  national 
legislation 
and normal procedures.  

will 

Where  Member  States 
choose  to  disapply  the 
anti-accumulation  rules, 
workers 
not 
experience  deductions 
to  child-raising  benefits 
facilitating  the  right  for 
both  parents  to  share 
child-raising 
responsibilities. 

However, 
this 
advantage  is  limited  as 
not  all  Member  States 
will 
the 
apply 
derogation 

A 
limited  number  of 
family  members  will 
lose  entitlement  on  the 
basis of derived rights. 

In 
a 
cases  where 
Member  State  applies 
derogation, 
the 
entitlement  will  be 
aligned to national law, 
making 
it  clearer  for 
parents  to  understand. 
this 
However, 
advantage  is  limited  as 
not  all  Member  States 
will 
the 
apply 
derogation.  

Doubts  about  who  has 
to  claim 
entitlement 
such 
are 
benefits 
resolved  reducing  the 
number  of  disputes 
over derived rights.  

increase 

The  maximum 
financial 
impact  would  be  an 
in 
average 
expenditure  on  exported 
child-raising  benefits  for 
secondary 
competent 
Member States of 84% (in 
practice  this  is  expected 
to be more limited as not 
all  Member  States  will 
apply the derogation).  

Where 
there 
applied, 
would  be  a  shift  in  the 
burden  to  the  Member 
State  of  work  as  child-
raising 
allowances 
benefits will be paid in full 
secondary 
the 
by 
competent 
Member 
State. 

The  likely  economic  impact  on  the  individual  budgets  of  Member  States  is  set  out  on  the  table 
opposite.  As  previously  highlighted  in  the  methodology,  this  analysis  is  limited  to  the  actual  social 
security  costs  for  Member  States  for  providing  social  security  benefits.  It  has  not  been  possible  to 
analyse  the  corresponding  receipt  of  'contributions'  (levies  earmarked  for  social  security  purposes) 
into national social security schemes before the contingency occurs. The impact on income taxation is 
also  left  aside,  as  under  Regulation  (EC)  No  883/2004  only  contributions  are  coordinated,  while 
general taxation is not. Analysis has been based on administrative data provided by Member States, it 
has to be underlined that not all Member States were able to provide data on the different benefits, nor 
was all data complete. Therefore analysis is provided to the extent possible. No economic impact has 
been  provided  where  it  is  assumed  that  these  measures  are  financially  neutral  as  they  either  do  not 
confer  or  limit  rights  or  obligations  beyond  those  already  existing  under  national  legislation  or  EU 
law.  

EN 

167 

   EN 

 
 
 
 
Indicative budgetary impact of preferred options against baseline scenario, in € ,000, 2013/2014 

Long-Term Care Benefits 

Unemployment Benefits 

The 
competent  Member  State 
provides  long-term  care  benefits  in 
cash  and  reimburses  the  cost  of 
benefits  in  kind  provided  by  the 
Member State of residence 

Frontier  workers:  Provide  for  the 
payment  of  unemployment  benefits 
by the Member State of last activity 
only  in  situations  where  the  cross-
border worker has worked there for 
a  sufficiently  representative  period 
(12  months).  The  unemployed 
person  shall 
the 
employment services in the State of 
last activity 

register  with 

Export  of  Unemployment  Benefits: 
Extend  the  period  for  export  of 
unemployment 
a 
minimum  period  of  6  months  (or 
end of entitlement period if shorter) 

benefits 

to 

Aggregation  of  Unemployment 
Benefits: 
a 
Introduction 
minimum  period  of  insurance  or 
(self-)employment  of  three  months 
before 
of 
unemployment benefits  

aggregation 

of 

Access to Social Benefits for 
Economically Inactive Citizens and 
Jobseekers 

The  amendment  of  Article  4  of 
Regulation  (EC)  No  883/2004  to 
make reference to the limitations in 
Directive  2004/38/EC.  This  could 
be  combined  with  guidance 
to 
provide a more detailed explanation 
of the rules.  

Family Benefits 

Status  quo  with  individual  rights 
for all-child raising allowances (flat 
rate 
and 
optional  derogation  from  the  anti-
overlapping rules) 

salary-related): 

and 

Baseline
Annual 
expenditure 
(in € ,000)  

Option 
Annual 
Expenditure 
(in € ,000) 

% 
change 

Baseline
Annual 
expenditure 
(in € ,000)  

Option 
Annual 
Expenditure 
(in € ,000) 

% 
change 

Baseline
Annual 
expenditure 
(in € ,000)  

Option 
Annual 
Expenditure 
(in € ,000)  

% 
change 

Baseline 
Annual 
expenditure 
(in € ,000)  

Option 
Annual 
Expenditure 
(in € ,000)  

% 
change 

Baseline
Annual 
expenditure 
(in € ,000)  

Option 
Annual 
Expenditure 
(in € ,000) 

% 
change 

Baseline
Annual 
expenditure  
 (in € ,000) 

Option 
Annual 
Expenditure  
(in € ,000) 

% 
change 

BE 

BG 

CZ 

DK 

DE 

EE 

IE 

EL 

ES 

FR 

HR 

IT 

66,999 

66,999 

1,576 

1,576 

8,098 

8,098 

49,694 

49,694 

166,721 

166,721 

1,278 

1,278 

6,832 

6,832 

3,839 

3,839 

16,126 

16,126 

41,317 

41,317 

572 

572 

44,820 

44,820 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

67,478 

55,044 

-18% 

n.a. 

236 

480 

103% 

n.a. 

1,073 

2,102 

96% 

n.a. 

7,342 

11,709 

59% 

n.a. 

85,752 

70,428 

-18% 

n.a. 

309 

159 

-49% 

n.a. 

16,569 

14,818 

-11% 

n.a. 

678 

981 

45% 

n.a. 

23,148 

20,162 

-13% 

n.a. 

69,820 

36,868 

-47% 

n.a. 

168 

182 

8% 

n.a. 

23,838 

19,221 

-19% 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

20,466 

9,692 

-53% 

n.a. 

n.a. 

1,319 

1,264 

-4% 

n.a. 

n.a. 

n.a. 

n.a. 

316 

n.a. 

n.a. 

n.a. 

64 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

117 

n.a. 

29 

n.a. 

n.a. 

n.a. 

n.a. 

-63% 

n.a. 

n.a. 

n.a. 

-55% 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

6,503 

1,953 

-70% 

n.a. 

n.a. 

52,962 

19,735 

-63% 

n.a. 

n.a. 

8 

n.a. 

n.a. 

7 

n.a. 

-6% 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

83,567 

83,567 

- 

n.a. 

n.a. 

n.a. 

951 

n.a. 

951 

n.a. 

24,384 

24,384 

n.a. 

105,760 

105,760 

n.a. 

573 

573 

n.a. 

11,577 

11,577 

n.a. 

n.a. 

n.a. 

11 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

11 

n.a. 

n.a. 

n.a. 

n.a. 

- 

- 

- 

- 

- 

n.a. 

- 

n.a. 

n.a. 

n.a. 

EN 

168 

EN 

 
  
 
 
 
 
 
 
  
CY 

LV 

LT 

LU 

HU 

MT 

NL 

AT 

PL 

PT 

RO 

SI 

SK 

FI 

SE 

UK 

711 

485 

711 

485 

1,121 

1,121 

129,420 

129,420 

1,293 

1,293 

628 

628 

61,883 

61,883 

93,118 

93,118 

6,865 

6,865 

4,572 

4,572 

5,366 

5,366 

1,860 

1,860 

1,851 

1,851 

6,940 

6,940 

8,585 

8,585 

60,227 

60,227 

EU-28 

792,797 

792,797 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

513 

479 

-7% 

n.a. 

24 

15 

66 

59 

175% 

n.a. 

293% 

n.a. 

29,501 

86,596 

194% 

n.a. 

520 

75 

640 

79 

23% 

n.a. 

5% 

n.a. 

55,344 

65,275 

18% 

n.a. 

16,051 

33,257 

107% 

n.a. 

594 

606 

2% 

n.a. 

3,735 

4,968 

33% 

n.a. 

n.a. 

975 

n.a. 

n.a. 

n.a. 

1,276 

31% 

n.a. 

1,463 

730 

-50% 

n.a. 

1,755 

6,633 

278% 

n.a. 

2,559 

2,100 

-18% 

n.a. 

6,440 

5,919 

-8% 

n.a. 

415,995 

441,686 

6% 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

4 

5 

n.a. 

53 

n.a. 

525 

n.a. 

337 

n.a. 

11 

4 

3 

n.a. 

438 

326 

8 

0% 

n.a. 

-42% 

n.a. 

n.a. 

n.a. 

-17% 

n.a. 

-3% 

n.a. 

-25% 

n.a. 

n.a. 

1,824 

1,220 

-33% 

n.a. 

n.a. 

n.a. 

n.a. 

342 

n.a. 

n.a. 

n.a. 

2 

n.a. 

n.a. 

n.a. 

441 

n.a. 

797 

n.a. 

773 

n.a. 

43 

n.a. 

220 

n.a. 

1 

n.a. 

275 

366 

303 

17 

n.a. 

n.a. 

-36% 

n.a. 

n.a. 

n.a. 

-33% 

n.a. 

n.a. 

n.a. 

-38% 

n.a. 

-54% 

n.a. 

-61% 

n.a. 

-60% 

n.a. 

n.a. 

86,794 

35,979 

-59% 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

107 

n.a. 

n.a. 

n.a. 

107 

n.a. 

n.a. 

476,900 

476,900 

n.a. 

336 

n.a. 

n.a. 

336 

n.a. 

n.a. 

35,622 

35,622 

n.a. 

147,323 

147,323 

n.a. 

3,995 

3,995 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

1,545 

1,545 

n.a. 

19,359 

19,359 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

n.a. 

- 

n.a. 

- 

- 

n.a. 

- 

- 

- 

n.a. 

n.a. 

n.a. 

- 

- 

n.a. 

n.a. 

n.a. 

912,010 

912,010 

- 

EN 

169 

EN 

 
  
Based on the preceding analysis of the options against these objectives it follows that: 

For long-term care benefits, option 1 is the most efficient and effective option to fulfil the objectives 
for long-term care benefits.  

By  introducing  a  legal  basis  for  the  already  applicable  rules,  this  option  introduces  a  regime 
appropriate  to  long-term  care  benefits,  while  maintaining  continuity  with  the  current  system.  In 
parallel,  it  achieves  legal  clarity  and  transparency  on  the  rules  applicable  both  for  citizens  and 
institutions  as  well  as  other  stakeholders.  Although  benefits  in  kind  are  provided  by  the  residence 
State, costs of all cash and in kind benefits provided are at the expense of the competent Member State 
which ensures a fair distribution of the financial burden. This option however will not solve existing 
mismatches in case the competent Member State has no benefits in cash and the State of residence has 
no benefits in kind. 

Option  1  is  the  most  cost-efficient  and  effective  option  in  facilitating  the  application  of  the 
coordination rules. 

For  the  coordination  of  unemployment  benefits,  the  best  compromise  would  be  a  combination  of 
option  3a  for  competence  and  registration  of  frontier  workers,  option  1  for  the  export  of 
unemployment  benefits,  and  of  option  2b  for  the  aggregation  of  periods  in  combination  with  the 
horizontal option regarding the recognition of periods for the purpose of aggregation. 

This combination of options would ensure that: 

a) The Member State of last activity would remain competent for providing unemployment benefits to 
frontier and other cross-border workers in all cases where those persons have been insured there for at 
least  12  months,  because  it  can  be  assumed  that  this  suffices  to  create  a  strong  link  to  the  labour 
market of this State; 

b)  The  Member  State  of  residence  becomes  competent  for  those  who  have  not  satisfied  this 
requirement and thus have not established such a strong link; 

c) Periods completed in another Member State are only taken into account, where those periods would 
also  have  been  considered  as  periods  of  insurance  in  that  Member  State  where  they  have  been 
completed; 

d) The Member State of last activity becomes competent in all other cases for those who have been 
insured there for at least three months as regards the aggregation of periods; 

e) The Member State of previous activity becomes competent and has to export the benefit whenever 
this condition has not been satisfied; 

f) Cash benefits are exported, i.e. are paid to unemployed persons looking for a job in another Member 
State  than  the  competent  one  for  an  extended  period  of  at  least  six  months  in  order  to  provide 
sufficient  time  for  an  effective  job  search  and  increasing  access  to  employment  opportunities 
throughout the Union. 

They  are  also  aligned  with  the  general  and  specific  objectives  and  wider  EU  policy  objectives  on 
active  labour  market  policy  such  as  the  2013  citizenship  report  (COM(2013)269)  which  as  its  key 
action 1 refers to the proposal to extend the export of unemployment benefits to six months. 

For  access  to  social  benefits  for  economically  inactive  EU  mobile  citizens  and  jobseekers  the  most 
efficient  option  responding  to  the  objectives  is  the  amendment  of  Article  4  of  Regulation  (EC)  No 
883/2004 to make reference to the limitations in Directive 2004/38/EC. To increase the effectiveness 
of this option it could be combined with option 3, which would allow for a more detailed explanation 
of the rules. This option would increase legal certainty and clarity and transparency while, at the same 
time,  allowing  room  for  a  dynamic  interpretation  of  the  Regulation  as  the  case-law  of  the  CJEU 
concerning the relationship between the Regulation and the Directive develops.  

This option will increase legal clarity and transparency on the rights of economically inactive mobile 
EU citizens and jobseekers and also on the extent to which Member States’ social security institutions 

EN 

i 

   EN 

 
are  permitted  to  limit  the  equal  treatment  principle  for  such  persons  in  relation  to  access  to  certain 
social benefits. It is anticipated to thereby improve the administrative simplicity and enforceability of 
the rules. 

For  family  benefits  the  most  efficient  and  effective  combination  responding  to  the  objectives  is  the 
combination of the status quo with the horizontal option c. This combination will ensure that primary 
responsibility for family benefits is retained by the Member State of economic activity where a parent 
pays taxes and social security contributions in a manner, while the Member State which has secondary 
competence  will  pay  a  differential  supplement  if  its  family  benefits  are  higher.  This  maintains 
protection  for  family  members  and  upholds  the  best  interests  of  the  child.  By  introducing  the 
horizontal  option  c,  it  is  also  possible  to  protect  the  individual  interests  of  parents  who  seek  to 
maintain a balance between work and family life during periods of child-raising by placing a greater 
emphasis  on  individual  rights  and  supporting  those  Member  States  who  are  actively  promoting 
flexible  and  family  friendly  working  practices  without  imposing  this  obligation.  This  option  has  the 
potential to be effective at achieving the General and Specific EU objectives and also the wider EU 
objectives,  the  Fresh  Start  to  address  the  challenges  of  work-life  balance  faced  by  working  families 
and  is  simple  to  apply.  This  flexible  approach  will  thereby  increasing  sustained  labour  market 
participation  by  parents  during  periods  of  child-raising.  However,  as  the  derogation  from  the  anti-
accumulation  rules  is  optional  rather  than  mandatory  in  practice  it  is  likely  to  be  less  effective  at 
achieving  the  goals  and  the  problems  identified  concerning  disincentives  to  ongoing  labour  market 
participation may continue to subsist. It is anticipated in light of measures already foreseen outside the 
scope  of  the  revision  (the  launch  of  EESSI  and  implementation  of  Decision  F2)  that  the  aim  of 
improving efficiency of processing family benefit claims will also be achieved. 

9.  How would the impacts be monitored and evaluated? 

9.1.  Monitoring indicators 

In accordance with the Better Regulation Guidelines, this section provides an outline of the proposed 
arrangements for monitoring and evaluation (including the proposed indicators). Final monitoring and 
evaluation arrangements will be approved at a later stage.453  

Monitoring will take place on two levels. The first level consists of monitoring the implementation of 
the  proposed  action  by  the  Commission  at  EU  Level.  In  its  role  as  the  guardian  of  the  Treaties,  the 
Commission closely monitors and assists Member States and citizens in the implementation of the EU 
social security coordination and of free movement of workers rules by regularly assessing the national 
legislations and/or practices in place, investigating potential infringements of EU rules in the Member 
States, filing observations in preliminary references made by the national courts on questions on the 
interpretation and application of the EU social security rules and responding to individual questions, 
complaints,  petitions  or  citizens’  queries.  For  example,  the  Commission's  Your  Europe  Advice  and 
SOLVIT citizens' advice services publish annual reports identifying the number and nature of citizens 
concerns on particular topics within EU competence including EU social security coordination. 

The  second  level  consists  of  the  monitoring  by  the  Administrative  Commission  to  assess  the 
application of the proposed changes at national level. The Administrative Commission has the specific 
tasks to454: 

453 Better Regulation Guidelines, Section 2.7, p30. 
454 Article 72 of Regulation (EC) No 883/2004. 

EN 

ii 

   EN 

 
 
 
 
 
                                                 
− 

− 

facilitate the uniform application of EU law, especially by promoting exchange of experience 
and best administrative practices between the Member States; 

foster and develop cooperation between Member States and their institutions in social security 
matters and facilitate the realisation of actions of cross border cooperation activities in the area 
of coordination of social security systems; 

−  modernise  the  procedures  for  exchanging  information  and  adapting  the  information  flow 

between institutions for the purposes of exchanging data by electronic means. 

The  Commission  can  request  the  Member  States  represented  in  the  Administrative  Commission  to 
report  on  the  effective  application  of  the  coordination  rules  in  the  Member  States,  especially  on  the 
close and effective cooperation between the authorities and institutions in different Member States as 
one of the key factors for an efficient functioning of the EU rules on the coordination of national social 
security  systems.  It  is  supported  by  associated  networks  such  as  the  informal  Social  Security 
Coordination Communication Network and National Contact Points on Fraud & Error also comprised 
of  representatives  from  Member  States  who  are  also  able  to  monitor  effectiveness  of  the  proposed 
measures and identify any potential difficulties in application in specific fields.  

Moreover,  the  Member  States  are  under  the  obligation  to  compile  statistics  on  the  application  of 
Regulation  (EC)  No  883/2004  and  (EC)  No  987/2009  and  forward  them  to  the  Secretariat  of  the 
Administrative Commission455 including in relation to the payment of unemployment benefits; on the 
coordination of long-term care benefits and the coordination of family benefits to be analysed by the 
Network  of  experts  on  statistics  on  Free  movement  of  Workers  and  Social  Security  Coordination,  a 
consortium of HIVA- KU Leuven, Milieu Ltd, IRIS University Ghent, whose tasks is to collect and 
analyse  the  statistical  data  on  an  annual  basis.  Reports  are  compiled  annually  on  these  topics  and 
published on the DG EMPL website.456 

The Administrative Commission may set up working parties and study groups for special problems. A 
'Reflection Forum' was set up in June 2014, consisting of a collective brain storming exercise within 
the  framework  of  the  Administrative  Commission  on  the  future  challenges  for  social  security 
coordination.  The  discussions  in  the  Reflection  Forum  will  provide  a  platform  for  analysing,  and 
clarifying issues of common concern on an administrative level and for openly discussing them in the 
context of social security coordination as part of a wider challenge, irrespective of whether some may 
be more controversial than others in their political context. The purpose of the Reflection Forum is to 
frame  the  discussion  of  the  topics,  draw  parallels  between  them  and  identify  specific  issues  that 
warrant further action in the future. 

The  informal  Social  Security  Coordination  Communication  Network,  composed  of  Member  States' 
representatives dealing with communication issues on EU social security coordination rules, provides 
feedback to the Commission about the challenges faced in communicating EU rules on social security 
coordination at national level, and advance proposals in order to improve the quality and availability 
of information on EU rules on social security coordination. For instance, the revision of the guides on 
Member States national security systems published by the European Commission to make them more 
simple, user friendly and adaptable to national website, was based also on a feedback received from 
the  network.  The  network  can  thus  play  a  positive  role  in  monitoring  the  awareness  of  the  rules  on 
long-term care, unemployment benefits, family benefits and access of economically inactive citizens 
and mobile jobseekers to certain social benefits. 

Mechanisms  for  gathering  data  in  relation  to  the  indicators  at  both  EU  level  and  National Level  are 
already in place with capacity for informing the review on at least and annual basis and therefore there 
is no need for development of new mechanisms for data collection or to envisage that such methods 
will  entail  additional  costs  for  the  European  Commission  or  for  the  Member  States  to  achieve. 

455 Article 91 of Regulation (EC) No 987/2009. 
456  Publication  of  reports  is  at  the  discretion  of  the  Commission  with  the  exception  of  sensitive  information  or  any  sensitive  reference  to 

single Member States.  

EN 

iii 

   EN 

 
                                                 
Indicators  based  on  the  data  collection  consortium  HIVA,  Milieu  Ltd,  IRIS  University  Ghent  are 
foreseen to be  monitored on an annual basis, while surveys on the application of the Regulation are 
envisaged to be less frequent (every 2-3 years). 

9.2.  Operational objectives for the preferred policy options and their monitoring 

9.2.1  Long-term care benefits  

Table 19: Monitoring indicators for Long-term care benefits 

Operational objective 

Indicator 

Definition/Unit 
Measurement457 

of 

Existing data/Sources 

clarity 
for 

and 
Bring 
legal 
citizens, 
transparency 
institutions  and  stakeholders 
by introducing a definition for 
long-term care benefits, group 
the  rules  under  a  separate 
Chapter and establish a list of 
long-term  care  benefits  under 
Regulation 
No 
883/2004. 

(EC) 

Complaints 
from 
citizens  on  Long-term 
care benefits 

-  number  of  queries  and 
complaints  from  citizens  and 
institutions  about  difficulties 
in exercising their rights. 

Yes: 
Incoming 
correspondence  Commission 
(annually) 

EU litigation on LTC 

No.  of  national  and  CJEU 
cases  on  the  interpretation  of 
EU  law  on  long-term  care 
benefits. 

Yes: National Courts/ CJEU 

Complaints 
from 
national  authorities  on 
Long-term care benefits 

Experiences 
institutions 
application  of 
legal framework.  

from  national 
the 
revised 

with 
the 

Cases  of  overlapping 
payments 

amount of benefits in cash and 
the reimbursement for benefits 
in kind in Euros.  

Reduce  administrative  costs 
and cases of double payments 
by  providing  clear  rules  of 
when  long-term  care  benefits 
in  kind  are 
in  cash  and 
provided 
same 
for 
purpose and for the same time 
frame. 

the 

Administrative  costs  for 
public authorities 

administrative  costs  per  case 
for 
for  processing  claims 
long-term  care  benefits 
in 
Member State of residence. 

Complaints 
from 
national  authorities  on 
Long-term care benefits 

Experiences 
institutions 
application  of 
legal framework. 

from  national 
the 
revised 

with 
the 

No: 
Administrative Commission 

Survey 

in 

the 

in 

Survey 

Yes: 
the 
Administrative  Commission/ 
Data  collection  consortium 
HIVA,  Milieu  Ltd, 
IRIS 
University Ghent (annually) 

in 

Survey 

the 
Yes: 
Administrative  Commission/ 
Data  collection  consortium 
HIVA,  Milieu  Ltd, 
IRIS 
University Ghent (annually) 

Survey 

No: 
Administrative Commission 

by 

the 

the 

number 

Reduce 
of 
conflict  situations  between 
institutions, 
l 
individual  complaints,  and 
or 
fewer 

preliminary 

resulting 

in 

Complaints 
from 
citizens  on  Long-term 
care benefits 

Number  of  complaints  from 
citizens  about  difficulties  in 
exercising their rights. 

Yes: 
Incoming 
correspondence  Commission 
(annually) 

457 The benchmark against which the indicators will be evaluated will be the data of application of Regulation (EC) No 883/2004,  
i.e. 1 May 2010. 

EN 

iv 

   EN 

 
 
 
 
 
 
                                                 
 
infraction  procedures  to  be 
dealt with by the CJEU. 

EU Litigation on LTC 

No.  of  national  and  CJEU 
cases  on  the  interpretation  of 
EU  law  on  long-term  care 
benefits. 

Yes: National Courts/CJEU 

9.2.2  Unemployment benefits  

Table 20: Monitoring indicators for unemployment benefits  

Operational objective 

Indicator 

Definition/Unit 
Measurement 

of 

Existing data/Sources 

the  number  of 
Reduce 
concerning 
complaints 
access 
to  unemployment 
benefits  by  frontier  workers 
and cross-border workers  

Complaints  on  coordination 
of unemployment benefits by 
frontier workers/cross-border 
workers  

from 

-  number  of  queries  and 
complaints 
frontier 
workers/cross-border 
workers  about  difficulties  in 
exercising their rights 

Yes: 
Incoming 
correspondence  Commission 
(annually) 

EU  Litigation  on  UBs  for 
frontier/cross-border workers 

on 

cases 

Number  of  national  and 
CJEU 
the 
interpretation  of  EU  law  on 
unemployment  benefits  for 
the frontier and cross-border 
workers 

Yes: National Courts/ CJEU 

Ensure  a  better  correlation 
between  the  level  of  the 
unemployment  benefits  paid 
contributions 
and 
received  for 
the  frontier, 
cross-border  and  mobile  EU 
citizens  

the 

of 

contributions 
Level 
received 
of 
vs 
unemployment benefits paid 

level 

amounts 

of 
overall 
contributions  received  and 
paid per Member State 

Data 

collection 
Yes: 
consortium  HIVA,  Milieu 
Ltd,  IRIS  University  Ghent 
(annually) 

Increase 
persons 
benefits 

the  number  of 
their 
exporting 

Number of cases of export of 
unemployment benefits 

Number of persons applying 
for a PD U2 

Number  of  exchanges  on 
control  measures  between 
Member States 

Establish  common  ground 
for  extending  the  period  of 
export  of  unemployment 
benefits  and  establish  a 
systematic  cooperation  and 
control  mechanism 
to 
monitor  the  fulfilment  of 
rights and obligations by the 
unemployed  person  when 
exporting benefits.  

EESSI 

Number 
exchanges 
of 
between  Member  States  in 
the 
system 
concerning  the  monitoring 
of  rights  and  obligations  of 
unemployed  person,  report 
other 
on 
communication problems 

delays 

and 

Data 

Yes: 
collection 
consortium  HIVA,  Milieu 
Ltd,  IRIS  University  Ghent 
(annually) 

Data 

No: 
collection 
consortium  HIVA,  Milieu 
Ltd,  IRIS  University  Ghent 
(annually) 

Concerns/Recommendations 
from  national  authorities  on 
unemployment benefits 

Exchange of (best) practices 
between Member States 

Survey 

the 
No: 
Administrative  Commission 
(2-3 years) 

in 

Number  of  cases  of  fraud 
and 
field  of 
in 
unemployment benefits 

error 

Reported number of cases of 
'fraud and error'  

Yes:  Annual  discussion  on 
fraud  and  error 
the 
Administrative  Commission 
(annually) 

in 

Concerns/Recommendations 
from  national  authorities  on 

Feedback 
communication activities 

from 

Yes:  Survey  in  the  Informal 
Network 
Communication 

EN 

v 

   EN 

 
 
 
 
 
 
 
unemployment benefits 

(annually) 

Concerns 
national 
from 
authorities on aggregation of 
unemployment benefits 

Complaints  on  aggregation 
of unemployment benefits  

the  number  of 
Reduce 
and 
complaints 
infringements 
by 
establishing  clear  rules  on 
the aggregation of periods 

Survey on use of PD U2 

Survey 

Yes: 
the 
Administrative  Commission 
(annually) 

in 

-  Number  of  Queries  and 
from  citizens 
complaints 
about 
in 
difficulties 
exercising their rights 

Yes: 
Incoming 
correspondence  Commission 
(annually) 

Infringement proceedings 

Number  of 
Infringement 
procedures  on  aggregation 
of 

Yes:  European  Commission 
(annually) 

Increase  the  integration  of 
workers 
insurance 
system of a Member State 

the 

in 

Unemployed  mobile  persons 
applying  for  aggregation  of 
insurance periods 

Number  of  applications  for 
the  aggregation  of  periods 
by  wholly 
unemployed 
persons 

Concerns/Recommendations 
from  national  authorities  on 
unemployment benefits 

Exchange of (best) practices 
between Member States 

Administrative 
public authorities 

costs 

for 

and 

Reduce  administrative  costs 
for  public  administrations 
between  Member  States 
connected the administrative 
cooperation 
control 
mechanism  for  monitoring 
the  fulfilment  of  rights  and 
obligations  of  unemployed 
persons  who  are  exporting 
their 
unemployment 
benefits. 

rate 

all  Member  State: 
For 
of 
Unemployment 
frontier 
cross-border  and 
yearly 
total 
workers, 
expenditure 
on 
unemployment  benefits  for 
frontier  and  cross-border 
workers  having  worked  in 
that  Member  State  and 
distribution  effects  between 
national  and  cross-border 
workers 

in 

Survey 

Yes: 
the 
Administrative  Commission 
on  Document  PD  U1 
(annually) 

Survey 

No: 
the 
Administrative  Commission 
(every 2-3 years) 

in 

in 

Survey 

No: 
the 
Administrative  Commission 
Data  collection  consortium 
IRIS 
HIVA,  Milieu  Ltd, 
University Ghent (annually) 

9.2.3  Access of economically inactive EU citizens and jobseekers to certain social benefits 

Table  21:  Monitoring  indicators  for  access  by  economically  inactive  citizens  and 
jobseekers to certain social benefits 

Operational objective 

Indicator 

Definition/Unit 
Measurement458 

of 

Existing data/Sources 

the 

number 

of 
Reduce 
complaints concerning access 
to certain social benefits 

Complaints from citizens 
on 
social 
benefits 

access 

to 

Litigation 

on 
EU 
relationship 
between 
Social  Security  Rules 
and 
Directive 
2004/38/EC 

-  number  of  queries  and 
complaints  from  citizens  and 
institutions  about  difficulties 
in exercising their rights. 

No.  of  national  and  CJEU 
cases  on  the  interpretation  of 
EU  law  on  long-term  care 
benefits. 

Yes: Incoming correspondence 
Commission (annually) 

Yes:  National  Courts/  CJEU 
(annually) 

458 The benchmark against which the indicators will be evaluated will be the data of application of Regulation (EC) No 883/2004,  
i.e. 1 May 2010. 

EN 

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from 
Complaints 
national  authorities  on 
access to social benefits 

Experiences 
institutions 
application  of 
legal framework.  

from  national 
the 
revised 

with 
the 

Survey 

the 
No: 
Administrative  Commission 
(every 2-3 years) 

in 

9.2.4  Export of family benefits 

Table 22: Monitoring indicators for export of family benefits 

Operational objective 

Indicator 

Definition/Unit 
Measurement 

of 

Existing data/Sources 

from 
Complaints 
citizens  on  export  of 
family benefits 

-  number  of  queries  and 
complaints  about  difficulties 
in exercising their rights 

Incoming 
Commission (annually) 

correspondence 

EU Litigation on Family 
Benefits 

No.  of  national  and  CJEU 
cases  on  the  interpretation  of 
EU law on family benefits 

National 
(annually) 

Courts/ 

CJEU 

Export  of  child-raising 
allowances 

-  Survey  on  export  of  family 
benefits 

Survey 

Yes: 
the 
Administrative  Commission 
(annual)  

in 

Ensure  greater  clarity  on 
respective  responsibilities  of 
Member  States  for  export  of 
family benefits to families in a 
cross-border situation 

Increase  the  number  of  cases 
in  which  parents  are  able  to 
export  child-raising  benefits 
and  reduce  the  number  of 
complaints  concerning  their 
export  ensure  clarity  and 
consistency  in  applying  these 
rules  

Complaints 
from 
citizens  on  export  of 
child raising allowances 

Queries  and  complaints  about 
difficulties  parents  experience 
in exercising their rights 

Incoming 
Yes: 
correspondence 
the 
to 
Commission (annually) 

EU  Litigation  on  child-
raising allowances 

No.  of  national  and  CJEU 
cases  on  the  interpretation  of 
EU law on the export of child-
raising allowances 

Yes:  National  Courts/CJEU 
(annually) 

Reduce  regulatory  costs  for 
public 
in 
Member  States 
associated 
with export of family benefits 

administrations 

Speed  of  processing 
claims 

Time  needed  to  respond  to 
requests for information 

Survey 

the 
No- 
Administrative  Commission 
(annually) 

in 

Number  of  exchanges 
between Member States 

Number 
exchanges 
of 
between Member States in the 
report  on 
EESSI 
delays 
other 
communication problems 

system, 
or 

-No 
by 
Monitoring 
Administrative  Commission, 
Technical  Commission  and 
Executive Board (annually) 

-  Data 

No 
collection 
consortium HIVA, Milieu Ltd, 
IRIS 
Ghent 
University 
(annually) 

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9.3. 

Evaluation 

In addition, the Commission will evaluate the revised legal framework 5 years after its application in 
accordance with the Better Regulation Guidelines.  

It  is  anticipated  that  the  Commission  submits  to  the  European  Parliament,  the  Council  and  the 
Economic  and  Social  Committee,  5  years  after  the  date  of  implementation  of  the  amended 
Regulations, and every 5 years thereafter at the latest, an evaluation report on the application of the 
new instrument.  

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10. Annex I: Procedural Information 

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10.1.   Annex I: Procedural Information 

The  "Revision  of  Regulation  (EC)  No  883/2004  and  Regulation  (EC)  No  987/2010"  forms 
part of the Labour Mobility Package, included in the Commission's 2015 Work Programme. 
The lead DG for this initiative is EMPL.  

The  preparatory  work  started  in  2009  with  the  establishment  of  an  ad  hoc  expert  group  on 
long-term  care  benefits  under  the  auspices  of  the  Administrative  Commission  for  the 
Coordination of Social Security Systems.  

In  2013  and  2014  the  preparatory  work  on  a  revision  of  883/2004  continued,  involving  an 
impact assessment and a draft proposal for legislation. The proposal was drafted in response 
to  the  2011  Council’s  call  for  a  revision  of  the  rules  on  unemployment  benefits  in  order  to 
strengthen the link between contributions and benefits, and in view of the need to respond to 
the  introduction  of  a  new  type  of  “long-term  care  benefit”  at  national  level  in  view  of 
population change.  

An  Impact  Assessment  Steering  Group  (IASG)  was  set  up  to  discuss  the  elements  of  the 
proposal  initially  scheduled  for  adoption  in  Spring  2014  (coordination  of  long-term  care 
benefits;  export  of  unemployment  benefits;  coordination  of  unemployment  benefits  for 
frontier  workers)  with  representatives  of  the  following  Commission’s  services:  SG,  SJ, 
ECFIN,  MARKT,  HOME,  ENTR,  SANCO,  COMM,  JUST,  RTD,  EAC,  TAXUD,  REGIO 
and BEPA. The IASG met six times between June 2012 and November 2013. The minutes of 
the IASG meeting of 25 November 2013, as well as comments received on the draft Impact 
Assessment Report after the meeting, are annexed to this report in Annex XXIV. 

The adoption of the proposal was originally scheduled for spring 2014. However, in view of 
the  European  Parliament  elections  and  the  changes  in    political  level  playing  field,  the 
initiative was put ‘on hold’ and action to follow it up was left to the new Commission.  

Preparatory work was resumed in autumn 2014 and continued throughout 2015. 

An  Inter-Service  Steering  Group  (ISSG)  was  set  up  on  19  December  2014  to  discuss  the 
Labour Mobility Package, and concerned the following elements of the proposal: coordination 
of  family  benefits,  aggregation  of  unemployment  benefits,  and  access  to  special  non-
contributory  cash  benefits  for  economically  inactive  persons,  with  representatives  of  the 
following  Commission’s  services:  SG,  EMPL,  MOVE,  JUST,  CNCET,  ESTAT,  HOME, 
NEAR,  GROW,  SJ,  ENER,  REGIO,  TAXUD,  SANTE,  TRADE.  The  ISSG  met  6  times 
between January 2015 and September 2015. 

1.1.1  Advice from independent experts  

A study supporting the Impact Assessment for the elements of the proposal initially scheduled 
for adoption in spring 2014 (coordination of long-term care benefits; export of unemployment 
benefits;  coordination  of  unemployment  benefits  for  frontier  workers)  was  carried  out  by 
Deloitte Consulting459 and a final report was delivered on 6 December 2013.  Available data 
(principally through Labour Force Survey460 and 2012 Ageing Report461) was used to model 
budgetary  impacts  for  all  Member  States.  Further  data  was  collected  in  a  representative 

459 Deloitte, Consulting Study for the impact assessment for revision of Regulations (EC) Nos 883/2004 and 
987/2009, 6 December 2013. The study can be found in Annex V to this report. 
460 To be consulted at: http://epp.eurostat.ec.europa.eu/portal/page/portal/microdata/lfs. 
461 To be consulted at: http://ec.europa.eu/economy_finance/publications/european_economy/2012/pdf/ee-2012 
2_en.pdf. 

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sample  of  14  Member  States462,  and  additional  quantitative  information  to  support  problem 
definition  and  assessment  of  options  was  delivered  by  the  HIVA  KU  Leuven  Research 
Institute for Work and Society (HIVA)463. 

Six  studies  supporting  the  Impact  Assessment  for  the  further  elements  of  the  revision 
(coordination of family benefits and aggregation of unemployment benefits) were carried out 
by  a  consortium  under  the  lead  of  Fondazione  Giacomo  Brodolini464  and  by  HIVA  –  KU 
Leuven  Research  Institute  for  Work  and  Society  (HIVA)465,  and  the  final  reports  were 
delivered  in  August  2015.    Administrative  data  from  Member  States466  and  EU  available 
data467 were used to model economic impact and administrative burden for Member States. 
The  training  and  reporting  on  European  Social  Security  (trESS)  network468  of  independent 
experts  in  the  field  of  social  security  coordination  evaluated  the  coordination  of  long-term 
care benefits469, export of unemployment benefits and coordination of unemployment benefits 
for frontier workers470 and the potential legal impacts of the revision of Regulation (EC) No 
883/2004 with regard to coordination of long-term care benefits471. These three studies were 
presented in 2011 and 2012 to the Administrative Commission for the Coordination of Social 
Security Systems. The evaluations looked into the current legal framework of coordination of 
long-term  care  and  unemployment  benefits,  identified  the  challenges  that  stem  from  the 
application  of  the  current  EU  rules  in  these  areas  and  identified  possible  areas  for 
improvement.   

The  network  of  independent  experts  in  the  fields  of  free  movement  of  workers  and  social 
security coordination in the European Union (FreSsco) evaluated the potential legal impacts 
of  the  Revision  of  Regulation  (EC)  No  883/2004  with  regard  to  the  coordination  of  family 
benefits472,  the  aggregation  of  unemployment  benefits473,  and  access  to  special  non-

462 See Annex IV for a complete list of the analytical models used in preparing the impact assessment 
463 Pacolet, J. & De Wispelaere, F., Additional analysis for the partial revision for the provision on social security 
coordination in Regulation (EC) No 883/2004, November 2013 (Annex IX) and Pacolet, J. and De Wispelaere,  
F., Analysis of the characteristics and the duration of employed activity by cross-border and frontier workers for  
the purposes of coordinating unemployment benefits,  November 2013 (Annex X). 
464  Julie  Abrahamsen,  Monica  Lind,  Peter  G.  Madsen,  Administrative  costs  of  handling  exports  of  family  benefits,  2015  (Annex  XVI); 
Katrine  Julie  Abrahamsen,  Monica  Lind,  Peter  G.  Madsen  ,  Administrative  costs  of  handling  aggregation  of  periods  or  salaries  for 
unemployment benefits,  2015 (Annex XVII); Michele Raitano, Matteo Luppi, Riccardo Conti, Diego Teloni, Secondary effects following a 
change  of  regulations  on  the  exportation  of  family  benefits,  2015  (Annex  XVIII);  Michele  Raitano, Matteo  Luppi,  Riccardo  Conti,  Diego 
Teloni,  Secondary  effects  following  a  change  of  regulations  on  the  aggregation  of  periods  or  salaries  for  unemployment  benefits,  2015 
(Annex XIX) 
465 PACOLET and DE WISPELAERE Export of family benefits, Analysis of the economic impact of the options, 2015 (Annex XIII); Pacolet, 
J. & De Wispelaere, F, Aggregation of periods or salaries for unemployment benefits - Analysis of the economic impact of the options, 2015 
(Annex XIV);  
466  PACOLET  and  DE  WISPELAERE,  Export  of  Family  Benefits:  Report  on  the  Questionnaire  on  the  Export  of  Family  Benefits,  2015 
(Annex  XI),  PACOLET  and  DE  WISPELAERE,  Aggregation of  periods  or  salaries  for  unemployment  benefits,  HIVA-KU  Leuven,  2015 
(Annex XII) 
467 EUROSTAT, LFS 
468 www.tress-network.org. 
469   trESS Think Tank Report 2010, Analysis of selected concepts of the regulatory framework and practical 
consequences on the social security coordination, to be consulted at: http://www.tress 
network.org/tress2012/EUROPEAN%20RESOURCES/EUROPEANREPORT/ThinkTank_SelectedCncepts_Final_140111.pdf  and  the  
trESS Think Tank Report 2011, Coordination of long-term care benefits-current situation and future prospects, to be consulted at:  
http://www.tress-network.org/tress2012/EUROPEAN%20RESOURCES/EUROPEANREPORT/trESSIII_ThinkTankReport-
LTC_20111026FINAL_amendmentsEC-FINAL.pdf. 
470 trESS Think tank report 2012, Coordination of Unemployment Benefits, to be consulted at: http://www.tress- 
network.org/tress2012/EUROPEAN%20RESOURCES/EUROPEANREPORT/trESS_ThinkTankReport2012.pdf. 
471 trESS Analytical Study 2012, Legal Legal impact assessment for the revision of Regulation 883/2004 with regard to the coordination of  
long-term care benefits, to be consulted at: http://www.tress- 
network.org/tress2012/EUROPEAN%20RESOURCES/EUROPEANREPORT/trESS_Analytical%20Study%202012.pdf 
472 SPIEGEL, B. (ed.), CARRASCOSA BERMEJO, D., HENBERG, A. and STRBAN, G., Assessment of the impact of amendments to the 
EU  social  security  coordination  rules  on  export  of  family  benefits,  Analytical  Report  2015,  FreSsco,  European  Commission,  May  2015 
(Annex VI) 
473 FUCHS, B. (ed.), GARCIA DE CORTAZAR, C., BETTINA, K. and PÖLTL, M., Assessment of the impact of amendments to the EU 
socials security coordination rules on aggregation of periods or salaries for unemployment benefits,  

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contributory  cash  benefits  for  economically  inactive  persons474.  The  three  studies  were 
completed in June 2015. 

Technical amendments to the EU coordination rules 

Outside the scope of this impact assessment report, but included in the revision package are a 
number  of  proposals  for  technical  amendments  to  the  EU  coordination  rules.  These 
amendments  aim  to  bring  clarification  to  a  number  of  coordination  provisions,  but  not  to 
substantially  revise  them.  These  amendments  will  not  have  a  substantial  impact  and  hence 
their estimated effects will be explained in explanatory notes to the legislative proposal. 

Moreover,  the  package  will  also  include  a  'periodic  update'  of  the  Regulations  to  reflect 
developments in national legislation that have an effect on the coordination of social security 
systems in the EU. The aim is to ensure legal certainty for institutions and citizens by making 
technical amendments the wording of EU provisions or by amending certain annexes. This is, 
for instance, the case where a benefit ceases to exist in a Member State and has to be deleted 
from a specific annex to the EU Regulation, or where a wording of a specific article has to be 
corrected or clarified to avoid misinterpretation.  

The proposals for these technical amendments are based either on the proposal of a Member 
State, or a group of Member States, or of the Commission services. They were discussed and 
agreed by at least of qualified majority of Member States in the Administrative Commission 
on the Coordination of Social Security Systems.  

Finally, the revision package will include a proposal for a governance change concerning the 
procedure to amend the country-specific annexes to the coordination Regulations, with which 
the Commission proposes a simpler and faster legislative procedure to adapt the annexes. This 
element of the proposal is not expected to have social, economic or environment impacts and 
is therefore also excluded from the scope of this impact assessment. Its limited effects will be 
outlined in an explanatory note to the proposal. 

Further details concerning the Technical Amendments are contained in Annex XX. 

Analytical report 2015, FreSsco, European Commission, June 2015 (Annex VII) 
474 LHERNOULD, J.-P. (ed.), EICHENHOFER, E., RENNUY, N., VAN OVERMEIREN, F. and WOLLENSCHLÄGER, F., Assessment of 
the  impact  of  amendments  to  the  EU  social  security  coordination  rules  to  clarify  its  relationship  with  Directive  2004/38/EC  as  regards 
economically inactive persons, Analytical Report 2015, FreSsco, European Commission, June 2015 

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11. Annex II - Stakeholder consultation 

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As the preparatory work for the "Revision of Regulation (EC) No 883/2004 and Regulation 
(EC) No 987/2010" began in 2009, stakeholders were consulted on several occasions on the 
different elements which are now subject to revision:  

6.  Member  States  were  consulted  on  coordination  of  long-term  care  benefits,  export  of 
unemployment  benefits,  aggregation  of  unemployment  benefits,  coordination  of 
unemployment  benefits  for  frontier  workers,  export  of  family  benefits  and  access  to 
special  non-contributory  cash  benefits  for  economically  inactive  persons,    within  the 
framework  of  the  Administrative  Commission  for  the  Coordination  of  Social  Security 
Schemes (Administrative Commission). 

7.  National  administrations  were  also  consulted  via  a  specialised  online  survey  on  the 
coordination  of 
long-term  care  benefits,  export  of  unemployment  benefits  and 
coordination of unemployment benefits for frontier workers.  Also,  a  group  of  national  organisation  in 
charge of the payment of family benefits sent a position paper. 

8.  Social  partners  were  consulted  on  the  coordination  of  long-term  care  benefits, 
coordination of unemployment benefits for frontier workers and export of unemployment 
benefits  in  the  framework  of  the  Advisory  Committee  for  the  Coordination  of  Social 
Security Systems, and on the coordination of family benefits, long-term care benefits, and 
unemployment benefits during a dedicated hearing. 

9.  NGOs were consulted on the coordination of family benefits, long-term care benefits, and 

unemployment benefits during an ad-hoc consultation workshop. 

10. Two online consultations were also launched, one on the coordination of long-term care 
benefits, export of unemployment benefits and coordination of unemployment benefits for 
frontier  workers;  the  other  one  on  the  coordination  of  unemployment  benefits  and  the 
coordination of family benefits.  

It  has  to  be  noted  that  the  different  consultations  presented  different  degrees  of  specifity  in 
relation to the options assessed, and due to the high level of complexity of some topics, and 
the  late  definition  of  some  options,  some  consultations  have  been  kept  very  wide  (e.g.  the 
publis consultation on aggregation of unemployment benefits;  export of family benefits and 
social security coordination rules on the posting of employed and self-employed persons). A 
summary of these consultations is given in the sections below. 

1.  Member States 

Discussions  with  the  Member  States  on  coordination  of  long-term  care  benefits,  export  of 
unemployment benefits and coordination of unemployment benefits for frontier workers took 
place  at  the  meetings  of  the  Administrative  Commission  for  the  Coordination  of  Social 
Security Systems475 in the period 2009 to 2013.  

In  relation  to  the  coordination  of  long-term  care  benefits,  during  the  Working  Party  of  the 
Administrative  Commission  on  the  revision  of  EU  provision  on  coordination  of  long  term 
care  benefits  and  unemployment  benefit  of  10  October  2013,  Member  States  delegations 
(some  representing  their  governments'  positions,  other  sharing  their  opinions  as  experts) 
expressed their views on the options under consideration. A majority of delegations supported 
the  creation  of  a  specific  definition  and/or  specific  chapter  and/or  list  of  benefits 

475  While  all  Member  States  are  represented  at  the  meetings  of  the  Administrative  Commission  for  the  Coordination  of  Social  Security 
Systems, not all delegations necessarily have taken the floor during the several discussions on the different options.  

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(Luxembourg,  Spain,  Italy,  Portugal,  Lithuania,  Poland,  Belgium,  Malta,  Sweden,  Czech 
Republic,  Hungary  and  Latvia  explicitly  supported  the  option,  whilst  Austria,  Germany, 
France,  Ireland,  Slovenia,  Slovakia  and  Greece,  without  taking  definite  position,  supported 
some  elements  of  this  option  or  did  not  object  it).  Others  were  in  favour  of  the  status  quo 
(Belgium,  Greece,  Spain,  Hungary,  Malta,  Poland,  Sweden,  Estonia  as  well  as  the  United 
Kingdom and France without declaring their definite position).  

A specialised questionnaire was also launched by the Commission at the beginning of 2012 
on the coordination of long-term care benefits: on the basis of a report476 prepared in 2012 by 
the  trESS  (Training  and  Reporting  on  European  Social  Security)  Network,  Member  States 
were asked to describe their policy approach with regards to persons in need of LTC, to assess 
a new definition for LTC benefits, to identify further challenges than those presented in the 
report.  

To the question whether the Regulation shoud be amended to better coordinate LTC benefits, 
MS answered as follows: 

•  Open to any solution: Hungary, Finland;  
•  There should be a separate Chapter for LTC benefits (including also a definition and 
elaborated  list):  Luxembourg,  Austria,  Greece,  Slovakia,  Ireland,  Portugal,  Czech 
Republic, Lithuania, and Slovenia.  

•  Special  rules  for  LTC  benefits  (irrespective  of  the  place  –  new  chapter  or  Sickness 

Chapter): Netherlands. 

•  No change of the existing system of coordination: Poland, Sweden, France. 
•  All benefits should be regarded as benefits in kind: Denmark. 
•  No coordination as sickness benefits: Estonia. 
•  Competence only of the MS of residence: Austria (if safeguarded that no differential 
payments or subsidiary competence of any other MS – some parameters are elaborated 
in the note), Lithuania. 
 Always  the  first  MS  which  grants  LTC  benefits  should  remain  competent  is  not 
acceptable: Czech Republic, Lithuania. 

• 

•  LTC benefits should not be coordinated as pensions: Lithuania, Romania (as invalidity 

benefits). 

•  Benefits granted to the carer should be regarded as income and so Title II should apply 
to the carer: Poland, Ireland (also the existing system seems to focus more on direct 
benefits than on the provision of services), Hungary. 

•  A  detailed  list  for  the  application  of  Article  34  of  Regulation  (EC)  No  883/2004 

should be made: Poland, Bulgaria, Lithuania, France. 

•  Rights to LTC benefits should be treated as individual rights: Slovenia. 

Other remarks:  

•  Whatever solution is sought, it must be stable, easy to administer and transparent for 

the citizens, and social tourism must be avoided: Austria. 
•  Further rulings of the CJEU should be awaited: Finland.  
•  An introduction of a specific equalisation of claims for LTC benefits: Poland. 
• 

 Special rules for LTC benefits should be included in the Sickness Chapter: Italy.  

476  trESS  Network,  Legal  impact  assessment  for  the  revision  of  Regulation  883/2004  with  regard  to  the  coordination  of  long-term  care 
benefits; 
http://www.tress-
network.org/tress2012/EUROPEAN%20RESOURCES/EUROPEANREPORT/trESS_Analytical%20Study%202012.pdf 

Analytical 

available 

Study 

2012, 

at: 

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•  Another  possibility  would  be  to  follow  the  same  principles  as  under  the  Family 

Benefits Chapter: Czech Republic.  

•  There should be a non-exhaustive list of LTC benefits: Spain. 
•  First the work should focus on the application of Article 34 of Regulation (EC) No  

883/2004 and on the various CJEU rulings concerning LTC: Lithuania.  

•  Article  66  (2)  of  Regulation  (EC)  No  987/2009  has  to  be  amended  to  allow  for 

reimbursement of LTC benefits via a separated liaison body: France.  

•  A better coordination seems to be necessary (it is not yet clear which one): Belgium.  

Finally, to the question as whether all LTC benefits should be coordinated in the same way 
(i.e.  one  set  of  coordination  rules),  or  should  it  be  still  possible  to  coordinate  them  under 
different Chapters, MS answered as follows:  

•  All  LTC  benefits  and  schemes  should  be  coordinated  under  one  Chapter: 
Luxembourg, Denmark,  Finland,  Greece, Bulgaria, Portugal, Czech Republic,  Spain, 
Slovenia, France, Netherlands, Romania. 

•  Open to both solutions: Finland.  
•  LTC  benefits  should  be  inserted  in  Article  3  of  Regulation  (EC)  No  883/2004: 

Luxembourg.  

•  There  should  be  a  more  elaborated  list  of  all  the  LTC  benefits  covered  by  the  new 

• 

coordination: Luxembourg. 
 LTC  benefits  should  remain  coordinated  as  today  under  the  various  chapters  of 
Regulation (EC) No 883/2004: Italy, Hungary (new coordination only for the rest not 
covered by these special chapters), some MSs refer to some of these cases explicitly. 
•  Social  assistance  benefits  cannot  be  coordinated  as  other  LTC  benefits:  Austria  (at 
least  this  has  to  be  further  examined),  Poland,  Germany  (this  also  applies  to  LTC 
benefits for victims of war), Slovakia, Lithuania.  

•  Special  family  allowances  for  handicapped  children  shall  remain  coordinated  as 
family benefits: Austria, Latvia; same opinion concerning medical care allowances for 
children  and  supplement  to  family  benefits  which  are  treated  as  family  benefits: 
Poland. 

•  LTC  benefits  granted  under  the  accidents  at  work  and  industrial  diseases  scheme 
should  remain  coordinated  under  the  relevant  chapter,  as  this  is  more  favourable  for 
the persons concerned: Austria, Germany, Latvia. 

•  Benefits  which  up  until  now  have  been  regarded  as  invalidity  benefits  cannot  be 

treated as LTC benefits: Poland, Germany. 

•  Benefits  in  kind  and  in  cash  should  not  be  coordinated  in  the  same  way:  Estonia, 

Slovakia. 

•  A better coordination seems to be necessary (it is not yet clear which one): Belgium.  

In relation to the coordination of unemployment benefits for frontier workers, during the 
Working  Party  of  the  Administrative  Commission  on  the  revision  of  EU  provision  on 
coordination  of  long  term  care  benefits  and  unemployment  benefit  of  10  October  2013, 
Member  States  delegations  (some  representing  their  governments'  positions,  other  sharing 
their opinions as experts) expressed  their views on the options under consideration:  

•  8  delegations  were  in  favour  of  maintaining  the  status  quo  (Germany,  Ireland, 

Denmark, Switzerland, Netherlands, Austria, Greece, Slovakia); 

•  1  in  favour  of  introducing  an  option  to  choose  between  receiving  unemployment 

benefits from the country of last activity and residence (Hungary); 

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•  and 9 in favour of providing unemployment benefits for all workers from the state of 
last activity (Czech Republic, Spain, Poland, Italy, Romania, Slovenia, Luxembourg, 
France, Malta). 

In  relation  to  the  export  of  unemployment  benefits,  during  the  Working  Party  of  the 
Administrative  Commission  on  the  revision  of  EU  provision  on  coordination  of  long  term 
care  benefits  and  unemployment  benefit  of  10  October  2013,  Member  States  delegations 
(some  representing  their  governments'  positions,  other  sharing  their  opinions  as  experts) 
expressed their views on the options under consideration:  

•  9 delegations supported the current provisions (Germany, Spain, Netherlands, Greece, 

Austria, Denmark, Ireland, France, Belgium); 

•  and 6 delegations supported the option for a right to export for at least 6 months (PT, 

Slovenia, Malta, Slovakia, Romania, Italy) 

In relation to export of family benefits, during a Reflection Forum within the framework of  
the  Administrative  Commission  meeting  on  10-12  March  2015,  Member  States'  delegations 
(sharing their opinions as experts) expressed  their views on the options under consideration:  

•  a significant majority of delegations favoured maintaining the status quo for ensuring 
that family benefits were exported at the same rate payable in the state of employment 
(Bulgaria,  Switzerland,  Czech  Republic,  Estonia,  Spain,  Finland,  Croatia,  Italy, 
Lithuania,  Lithuania,  Latvia,  Poland,  Portugal,  Romania,  Sweden,  Slovakia  and 
Slovenia)477; 

•  a  minority  of  delegations  favoured  adjustment  of  the  amount  of  family  benefits  to 
reflect the living standards in the Member State of Residence of the child (Denmark, 
France, Ireland and Norway); 

•  a similar minority of delegations favoured the option of no export of family benefits in 

some or all cases (Austria, Luxembourg, Malta, UK). 

In  light  of  the  feedback  from  national  experts  following  consultation  within  the  Reflection 
Forum  of  the  Administrative  Commission,  the  Commission  has  developed  a  new  option 
concerning the priority rules for the payment of family benefits. During a second meeting on 
23-25  June  2015,  the  new  option  according  to  which  the  Member  State  of  residence  of  the 
child should always be primarily competent to award family benefits was discussed:  

• 

ten delegations  indicated support for this option as a first or second choice (Austria, 
Estonia,  Finland,  Ireland,  Latvia,  Luxembourg,  Malta,  Sweden,  Slovenia,  UK) 
although Sweden indicated they preferred changes in classification of benefits before 
considering changes in priority and the UK indicated their support for this option was 
conditional on not having to pay the differential supplement; 

•  nine delegations were expressly opposed to the new option (Cyprus, Germany, France, 

• 

Italy, Netherlands, Poland, Portugal, Romania, and Slovakia);  
the  most  popular  option  remained  maintaining the status quo, which is supported by 
17 delegations.   

In  the  discussions  concerning  export  of  family  benefits,  a  number  of  delegations  raised 
concerns  about  the  application  of  the  family  benefit  rules  to  child-raising  allowances.    This 
concern was expressed by Denmark, Finland, Austria and Sweden.  The development of the 

477 Belgium also expressed support for the status quo in a written note sent to the Commission 

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horizontal  option  was  developed  at  a  later  stage  as  a  result  of  the  feedback  from  Member 
States and other stakeholders. 

In relation to the aggregation of unemployment benefits, during a Reflection Forum within 
the  framework  of  the  Administrative  Commission  meeting  on  10-12  March  2015,  Member 
States  delegations  (sharing  their  opinions  as  experts)  expressed  their  views  on  the  options 
under consideration. The discussion revealed widely divergent views of the delegates with a 
slight  majority,  however,  favouring  the  maintenance  of  the  status  quo.  However,  some 
delegations had rather strong views on the issues (in particular Denmark and Greece, who had 
submitted notes in favour of the 'three-month' option), whereas others were more flexible or 
declared that they could support more than one option: 

•  option  1  (maintenance  of  status  quo)  was  supported  by  the  following  delegations: 
Germany,  Czech  Republic,  Poland,  Italy,  Portugal,  Bulgaria,  Estonia,  Slovakia, 
Belgium, Croatia, Slovenia;  

•  option  2.a  (aggregation  only  after  working  one  month)  was  supported  by: 

Luxembourg, Finland;  

•  option 2.b (aggregation only after working three  months)  was  supported  by:  Greece, 
Denmark,  Malta,  Austria,  Luxembourg,  France,  Lithuania,  Luxembourg,  Romania, 
UK, Latvia, Ireland. 

The  supporters  of  the  one-day  rule  (option  1)  rather  focused  on  the  needs  of  (returning) 
migrant  workers  and  felt  the  need  to  ensure  that  there  are  no  gaps  in  their  protection.  The 
supporters of option 2 (aggregation only after one or three months of work) rather focused on 
the needs of their institutions and wanted to ensure that unemployment benefits are only paid 
to those who had made a "substantial" contribution to their own schemes.  

In relation to the debate concerning the method of calculation of unemployment benefits: 

• 

• 

the  majority  of  delegations  were  in  favour  of  maintaining  the  status  quo  (i.e.  benefits 
should be calculated solely on the basis of salaries earned in the competent MS) (Czech 
Republic,  Ireland,  Portugal,  Bulgaria,  Estonia,  Slovakia,  Romania,  Latvia,  Hungary, 
Poland,  France,  Slovenia,  Croatia,  Lithuania  and  Italy)  –  however,  a  number  of 
delegations  caveated  their  position  to  make  clear  it  may  vary  depending  on  the  policy 
adopted in respect of aggregation.  For example, some pointed out that a strengthening of 
the  precondition  for  aggregation  (three-month  rule)  would  make  a  change  of  the 
calculation method superfluous; 
in relation to those  Member States who were open to change in the current rules (so that 
the calculation of unemployment benefits would also take into account salaries earned in 
another  MS),  the  positions  of  delegations  regarding  the  policy  options  concerning  were 
less clear, because many favoured such a change without time limitation.  Open for such a 
change were the following delegations: Denmark, Greece, Germany, Malta, UK, Finland, 
Netherlands, Luxembourg, Italy, Austria.   

The supporters of the status-quo as regards the calculation of unemployment benefits felt the 
need to ensure that benefits are paid quickly without additional administrative complications. 
The supporters of a change, i.e. of also taking into account foreign salaries for the calculation 
of benefits, felt that this would lead to fairer results. 

During a second meeting on 23-25 June 2015, delegations were consulted on how to deal with   
the  coverage  of  unemployed  persons  in  case  of  introduction  of  a  waiting  period  for  the 
aggregation of unemployment benefits:  

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• 

three delegations (Poland, Portugal, Hungary) expressed concerns about the risk of a gap 
in protection for mobile workers;  

•  six  Member  States  (Austria,  France,  Greece,  Ireland,  Malta  and  Romania)  all  of  whom 
supported  the  introduction  of  a  3  month  period  of  insured  employment  to  qualify  for 
aggregation  proposed  that  the  gap  should  be  addressed  by  extending  the  application  of 
Article 65(5)(a) to mobile workers who have worked for less than 3 months in the country 
of  new  employment  allowing  them  to  "reactivate"  entitlement  in  the  former  country  of 
employment. This proposal was opposed by the delegates from Germany, Spain, Sweden, 
Hungary and Portugal.  The UK delegate also had concerns about the practicalities;  
three  delegations  (Czech  Republic,  Germany,  Sweden)  were  opposed  to  specific 
coordinating  measures  to  address  the  gap  because  the  numbers  of  potentially  affected 
unemployed persons were very low and any changes to the rules to address the gap would 
be administratively burdensome to apply and may risk mobile workers being treated more 
favourably than nationals. 

• 

In relation to non-contributory cash benefits providing for a minimum subsistence level, 
during  a  Reflection  Forum  within  the  framework  of  meeting  of  the  Administrative 
Commission meeting on 23-25 June 2015, Member States delegations (sharing their opinions 
as experts) expressed their views on the options under consideration: 

•  nine  delegations  (Czech  Republic,  Germany,  France,  Lithuania,  Latvia,  Luxembourg, 
Netherlands, Sweden and UK) made clear that they preferred to wait for the outcome of 
the judgments of Alimanovic and Garcia Nieto before any firm action is taken; 

•  eight delegations (Malta, Hungary, Italy, Poland, Portugal, Finland, Lithuania and Spain) 

• 

• 

• 

favoured the status quo as a first or second choice;  
four (Spain, Finland, Hungary, Sweden) expressed support for the status quo accompanied 
by administrative guidance;  
twelve delegations supported the option of amending Article 4 as a first or second choice 
(Austria,  Belgium,  Czech  Republic,  Germany,  Estonia,  France,  Hungary,  Ireland, 
Lithuania, Latvia, Poland, UK) although there was no general consensus on the changes 
needed and some of these views are provisional as it includes Member States who were in 
favour  of  awaiting  the  outcome  of  the  pending  court  cases  before  adopting  a  fixed 
position;  
finally,  two  delegations  favoured  the  option  of  excluding  SNCBs  from  scope  of  Social 
Security Regulation (Estonia and Ireland). 

2.  National administrations 

A  web-based  survey  among  the  responsible  national  public  authorities  and  other  key  actors 
with regard to the coordination of unemployment benefits for frontier workers, the export of 
unemployment  benefits  and  the  coordination  of  long-term  care  benefits  was  launched  in 
December 2012 by Deloitte consulting. 

In relation to the coordination of unemployment benefits for frontier workers, 43% of all 
respondents think that the competent Member State should be the one in which the person last 
worked and paid social security contribution, even if a person lives in another Member State. 
About  27%  of  the  respondents  favour  a  right  of  choice  for  workers  to  claim  their 
unemployment benefits either in the country of last activity or the country of residence. About 
25% say that the country of residence should be the competent Member State, even if a person 
last  worked  and  paid  social  contributions  in  another  Member  State.  Applying  a  country-by-

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country  analysis,  the  results  are  slightly  different  with  regard  to  the  2nd  and  3rd  preferred 
option.  In  11  countries  (Cyprus,  Czech  Republic,  Finland,  France,  Hungary,  Italy,  Latvia, 
Malta, Netherlands, Portugal, Slovenia), the most popular option among public authorities is 
that unemployment benefits should be provided by the Member State in which the person last 
worked and paid social security contributions, even if he/she lives in another Member State.  

In several of these countries, there is also strong support for the option where workers would 
have a right of choice with regard to where to claim their unemployment benefits. The reasons 
why respondents say to favour this option are: it would put an end to the reimbursement of 
unemployment benefits between Member States and it is fairer that the Member State which 
receives  the  social  security  contributions  is  also  competent  to  provide  the  unemployment 
benefits. However, several respondents warn that this option entails risks of abuse/fraud. The 
country of residence may lack an incentive to check the legitimacy of the benefits provided by 
the  competent  country  and  to  follow-up  the  unemployed  person  during  the  job-seeking 
process. In 9 countries (Austria, Belgium, Denmark, Germany, Ireland, Luxembourg, Spain, 
Sweden, Switzerland), most public authorities are in favour of the Member State in which the 
person  lived  being  the  competent  Member  State,  even  if  he/she  last  worked  and  paid  social 
security contributions in another Member State. These countries are also generally against a 
thorough revision of the coordination rules. In 5 countries(Czech Republic, Estonia, Romania, 
Slovakia, UK), the most popular option is that a person should be allowed to choose to claim 
the benefit either in the Member State of last employment or in the Member State where the 
person lived (if these Member States are different). 

In  relation  to  the  export  of  unemployment  benefits,  almost  45%  of  all  respondents  are  in 
favour  of  giving  the  possibility  of  “exporting  unemployment  benefits”  (going  to  another 
country  to  look  for  a  job  while  continuing  to  receive  the  unemployment  benefits  from  the 
competent  institution)  until  the  end  of  the  person’s  entitlement  to  unemployment  benefits, 
according  to  the  rules  of  the  Member  State  which  provides  them.  34%  of  all  respondents 
would like to maintain the current period of export of 3 months with a possible extension of 
the export of unemployment benefits to 6 months. About 12% would like to extend the period 
of export in the entire EU to at least six months. 

Analysing the replies on a country-by-country basis, the results look differently. The current 
rule  of  a  three-month  period  of  export  with  a  possible  extension  to  6  months  is  the  most 
chosen option among public authorities in 11 countries (Austria, Belgium, Cyprus, Denmark, 
Estonia, Finland, France, Germany, Lithuania, Luxembourg, Netherlands, Switzerland). In 9 
countries  (HU,  Italy,  Latvia,  Malta,  Poland,  Romania,  Slovakia,  Slovenia,  Spain,  UK), 
exporting 
to 
unemployment benefits, according to the rules of the Member State which provides them, is 
the most preferred option. Only in one Member State (PT), public authorities favour a general 
period of export of minimum 6 months. 

the  unemployment  benefit  until 

the  person's  entitlement 

the  end  of 

52% of all respondents think that the export of unemployment benefits could lead to increased 
risk  of  misuse  or  abuse  of  rights.  This  is  also  the  opinion  of  most  public  authorities  in  15 
Member  States.  79%  of  this  group  of  respondents  think  that  the  risk  of  misuse  or  abuse  of 
rights is particularly high when the unemployment benefits would be provided until the end of 
a persons’ entitlement to unemployment benefits, according to the rule of the Member State 
which provides them. 33% of the respondents also believe that there would be an increased 
risk of abuse if the period of export would be generally extended to minimum 6 months. 

EN 

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45% of the respondents do not think that misuse or abuse of rights is a risk in cases of export 
of unemployment benefits. This is also the most dominant position among public authorities 
in 8 countries. 

Public  authorities,  who  believe  that  the  export  of  unemployment  benefits  could  lead  to 
increased risk  of misuse of rights,  propose the following mitigation measures to reduce this 
risk:  

•  The  receiving  Member  State  should  feel  more  responsible  for  jobseekers  who  have 
exported their unemployment benefit from another Member State. Agreements should be 
made between Member States about the control and the provision of active assistance to 
jobseekers (HU, Austria, Czech Republic, Ireland, Italy,  Lithuania,  Netherlands, Poland, 
Portugal and Slovenia). However, more control of jobseekers by the guest Member State 
will also increase the administrative burden and costs on Member States (Denmark). 

•  Some  Member  States  say  that  the  keeping  the  period  of  export  generally  limited  to 
maximum  3  months  will  limit  the  risk  of  abuse  and  misuse  of  rights.  Extension  may  be 
possible,  if  there  is  a  high  probability  that  the  jobseeker  will  find  work  at  short  term 
(Austria, Belgium, Ireland). Several Member States would like to enhance the role of the 
receiving  Member  State  in  providing  information  to  the  competent  Member  State  about 
the chances of a person to find a job at short-term, so that the competent Member State 
can  take  a  well-argumented  decision  about  extending  the  period  of  export  in  a  specific 
case (BE, Estonia, Czech Republic and France). 

o  All jobseekers who have exported their unemployment benefits should be obliged 
to report about their job seeking activities to the competent Member State (Czech 
Republic, Germany, Malta, Lithuania and France). Some countries are in favour of 
monthly reporting by the jobseeker to the competent institution (Germany, Malta 
and  Lithuania);  other  Member  States  say  that  a  3-monthly  reporting  would  be 
sufficient (FR). 

o  One  respondent  suggests  making  language  courses  compulsory  in  the  "guest" 
country, as language is often the most important barrier to integration in the labour 
market.  Also  reducing  the  height  of  unemployment  benefit  over  time  could 
provide an incentive to jobseekers abroad to actively apply for a job. 

o In the long-run, it should be possible to introduce an EU-Job pass for every EU citizen 
which contains his/her social data. Every public employment service should be able 
to  access  these  data,  based  on  a  single  European  social  database  (Germany, 
Netherlands). 

When people are exporting their unemployment benefit abroad, 40% of the organisations that 
deal with claims for exportation of unemployment benefits say that they receive information 
about the status of these job-seekers from the country of residence, but only on request. About 
19%  automatically  receives  information  from  country  of  residence.  About  10%  of  the 
respondents say that this information is not needed. The majority of these respondents cannot 
say if these job-seekers (who exported their unemployment benefit) had found a job. 

In  relation  to  the  coordination  of  long-term  care  benefits,  17%  of  the  national 
administrations  and  social  security  institutions  would  like  to  keep  the  current  coordination 
rules for long-term care benefits. About 28%  of the respondents believe that people should be 
treated  equally  in  the  Member  State  where  they  are  insured  and  should  not  have  their  care 
benefits reduced if they move to another Member State.  

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The options where a person in need of care is treated equally in the Member State where he is 
insured or where he/she lives are considered by  national  administrations  as  the  best  ones  to 
stimulate  free  movement  of  persons.  The  current  coordination  rules  are  seen  as  the  worst 
option to stimulate mobility of persons.  

In terms of social security coverage, national administrations have a preference for the option 
in which a person in need of care is treated equally in the Member State where he/she lives 
and  receives  LTC  benefits  there  in  accordance  with  national  legislation.  Also  the  option 
where  a  person  receives  care  benefits  in  cash  from  the  Member  State  of  residence, 
supplemented  by  the  Member  State  of  insurance  in  case  of  more  advantageous  conditions 
(top-up). 

Making the competent Member State fully responsible for the provision of the LTC benefits is 
seen as the best option to ensure a fair share of the financial burden between Member States. 

Almost half of the national administrations are of the opinion that all costs for LTC benefits 
should  be  borne  by  the  competent  Member  States  (where  the  migrant  person  is  insured). 
About one third prefers a system where those costs are shared between the Member State of 
residence  and  the  competent  Member  State.  The  latter  option  however  is  seen  as  the  most 
burdensome in terms of administration. 

Views of national organisations in charge of the payment of family benefits 

On 7 October 2015, a group of five national organisations in charge of the payment of family 
benefits  from  Belgium, France  and the Netherlands478, issued a position paper in relation to 
the possible revision of rules on the export of family benefits, strongly supporting the status 
quo. 

3.  Social partners 

In  relation  to  the  coordination  of  long-term  care  benefits,  export  of  unemployment 
benefits and coordination of unemployment benefits for frontier workers, social partners 
were consulted in the framework of the Advisory Committee for the Coordination of Social 
Security Systems on 24 October 2013.  

ETUC (European Trade Union Confederation) noted that in this work the Commission should 
take  into  account  the  experience  of  cross-border  workers  –  the  ETUC  has  found  that  these 
workers  are  often  the  first  to  lose  their  jobs  during  an  economic  downturn  and  can  then  be 
refused  unemployment  benefits  in  their  Member  State  of  residence.  The  ETUC's  research 
showed  this  to  be  a  persistent  and  spreading  problem.  ETUC  also  noted  that  the  current 
Regulations  do  not  cater  sufficiently  for  certain groups  of  mobile  workers,  like  apprentices. 
ETUC also expressed surprise at questions in the public consultation on whether the current 
regime  was  abused  by  migrant  workers,  given  that  the  document  was  aimed  at  finding  out 
how the rights of migrant worker can be improved.   

BUSINESS  EUROPE  commented  on  the  need  to  strike  the  right  balance  taking  account  of  
potential  costs  to  Member  States  and  businesses.  BUSINESSEUROPE  considered  that 
unemployment  benefits  should  be  time-limited  for  those  seeking  employment  in  another 
Member State, and deciding the specific time period left as a national competence.   

478  CCMSA  –  Caisse  centrale  de  la  Mutualité  sociale  agricole,  CNAF  –  Caisse  Nationale  des  Allocations  familiales  and  REIF  – 
Représentation  des  institutions  françaises  de  Sécurité  sociale  auprès  de  l’UE  (France);  FAMIFED  (Belgium);  and  SVB  -  Sociale 
Verzekeringsbank (The Netherlands) 

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ETUC  underlined  the  pressing  need  to  focus  on  defending  and  improving  the  rights  of 
workers.  In  particular,  if  a  mobile  worker  has  been  employed  and  paid  contributions  in 
another Member State to that in which they are resident, it seems right that the Member State 
of last activity should pay their unemployment benefits. 

A  dedicated  hearing  with  social  partners  was  also  organised  on  10  June  2015  to  allow  for 
collecting views on the coordination of long-term care benefits, export of unemployment 
benefits, aggregation of unemployment benefits, coordination of unemployment benefits 
for  frontier  workers,  export  of  family  benefits,  and  access  to  special  non-contributory 
cash benefits for non-active mobiel EU citizens. 

Employers  generally  referred  to  the  importance  of  finding  the  right  balance  between 
promoting labour mobility and combatting fraud.  

BUSINESSEUROPE  stated,  during  the  workshop  and  in  written  statements,  that  respecting 
the equal treatment principle and ensuring access to information is key. The package should 
take  a  comprehensive  approach  by  also  addressing  issues  like  e.g.  linguistic  skills  and 
EURES.  The  difference  in  perspectives  between  origin  and  destination  countries  was  also 
underlined. They also suggested that sectoral approaches may be necessary. Mobile workers 
should  not  have  access  to  unemployment  benefits  after  one  day  of  work  and  article  61  of 
Regulation 883/04 should be adapted. In relation to export of unemployment benefits, there is 
no change needed in the current period of export of unemployment benefit for a minimum of 
3 months. BUSINESSEUROPE recognised the link with the sustainability of social protection 
systems  and  the  need  to  combat  fraud  and  abuse.  The  Dano  case  was  welcomed  as  a 
clarification in this respect.  

CEEP (European Centre of Employers and Enterprises providing Public Services) stressed the 
importance of combating fraud and insuring the sustainability of systems.   

UEAPME  (European  Association  of  Craft,  Small  and  Medium-sized  Enterprises)  stated, 
during the meeting and in written contributions following the meeting, that the provision that 
the export of unemployment benefits to a second Member State can take place for 3 months 
(and  optionally  extended  to  6  months,  Art.  64.c)  should  remain  and  not  be  extended. 
UEAPME considers it important that workers are activated to find a job in the Member State 
of destination as soon as possible, in the interest of both employers and the unemployed. In 
relation  to  the  coordination  of  unemployment  benefits  for  frontier  workers,  UEAPME  does 
not consider the current situation, where an exception is made to the principle that the country 
of  employment  is  normally  responsible  for  the  payment  of  unemployment  benefits,  as 
problematic since a real frontier worker has generally a stronger relationship with the country 
of residence than the country of employment, which provides good grounds for this Member 
State to pay the benefits. In relation to the aggregation of unemployment benefits, UEAPME 
would  be  in  favour  of  introducing  a  minimum  waiting  period  in  the  Member  State  of  last 
employment  before  entitlement 
to 
unemployment  benefits  in  that  Member  State.  In  relation  to  export  of  family  benefits, 
UEAPME considers that the principle of the country of employment being responsible for the 
payment  of  family  benefits  should  be  maintained.  However,  if  this  family  lives  in  another 
Member State, UEAPME considers it fair to adapt the amount of benefits to the cost of living 
in that Member State.  

to  social  security  coverage  and  notably  access 

EFCI (European Federation of Cleaning Industries) stressed the need to promote mobility of 
apprentices  and  the  establishment  of  national  systems  of  apprenticeship  to  fight  youth 
unemployment.  

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PEARLE  (Performance  Arts  Employers  Association  Europe),  during  the  meeting  and  in  a 
written contribution, emphasised that employers in the live performance sector are confronted 
with specific issues on social security and posting and need instruments such as one-stop-shop 
or  national  centres  where  they  can  obtain  guidance  to  comply  with  the  requirements  in 
different countries.   

DA (Confederation  of  Danish  Employers) mentioned that electronic data exchange can also 
be used to combat issues like lacking payments of contributions in the country of origin. 

CEC  (Confederation  of  European  Managers),  during  the  meeting  and  in  a  written 
contribution,  highlighted the necessity to make sure that public authorities designated for the 
enforcement  of  the  different  provisions  (and  limitations  to  the  enjoyment  of  benefits)  apply 
rigorously the current legislation and adopt all necessary measures to ensure that workers no 
longer satisfying the conditions set by legislation are excluded from the benefits.  

The  trade  unions  warned  that  caution  should  be  applied  when  discussing  so-called  'social 
security tourism' and possible abuses as it might end up in some unilateral action of Member 
States that are not in line with EU law. Before engaging in a debate on a possible change of 
the  rules,  proper  analysis  should  be  conducted  to  assess  if  the  problems  are  a  result  of 
shortages in implementation, or problems that call for legislative action. A holistic approach 
should  be  applied  to  tackle  issues  such  as  possible  unequal  treatment,  involuntary  mobility 
and brain drain.  

ETUC, during the meeting and in a written statement,  stressed the need to base the discussion 
on  labour  mobility  on  proper  analysis  instead  of  copying  populist  propaganda  from  some 
Member  States.  On  the  coordination  of  unemployment  benefits  for  frontier  workers,  ETUC 
supports  the  possibility  for  frontier  workers  and/or  mobile  workers  who  are  seeking  new 
employment  in  another  Member  State  to  receive  their  unemployment  benefit  for  up  to  six 
months.  On  the  export  of  unemployment  benefits,  ETUC  supports  the  possibility  to  pay 
between three and six months. In relation to the aggregation of rights and the level of salary 
which  should  be  calculated  for  the  unemployment benefit,  ETUC  is  of  the  opinion  that  full 
entitlement to unemployment benefits should be assured and that qualifying periods could be 
accumulated  across  Member  States.  In  relation  to  long-term  care  benefits,  ETUC  is  of  the 
opinion that a rights based approach to long term care across the EU is urgently needed and 
calls upon the EU institutions to develop a coherent approach to long term care. In general, 
ETUC  underlined  that  the  principle  of  full  equal  treatment  in  the  host  country  is 
indispensable,  and  considers  it  unacceptable  if  amendments  to  the  Regulation  would  touch 
upon  this  principle  and  are  guided  by  the  concept  of  residence.  ETUC  also  stated  that  if 
exceptions are  considered they should be limited to cases which constitute clear abuses  and 
must be based on sufficient evidence about abuses and / or for reasonable motivations.  

TUC (Trades Union Congress, UK) highlighted that the right to family benefits is attached to 
the worker and not to the place of residence of the family. In their view lowering the family 
benefits for mobile workers would in any event constitute unequal treatment.  

EFBWW  (European  Federation  of  Building  and  Woodworkers)  stated  that  the  proposals  by 
the Commission appeared to focus mainly on some national concerns about "benefit tourism", 
and it underlined that only European problems, and not national ones, should be addressed at 
European level.  

4.  NGOs 

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Representatives  from  11  NGOs479  were  consulted  in  relation  to  the  coordination  of  long-
term  care  benefits,  export  of  unemployment  benefits,  aggregation  of  unemployment 
benefits,  coordination  of  unemployment  benefits  for  frontier  workers,  export  of  family 
benefits, and access to special non-contributory cash benefits for non-active mobiel EU 
citizens during a meeting on 17 June 2015. 

Participants  highlighted  the  importance  for  the  Commission  of  looking  at  the  definition  of 
worker,  of  ensuring  that  existing  gaps  in  social  security  protection  for  mobile  citizens  are 
addressed,  and  of  strengthening  the  collection  of  statistics  on  intra-EU  mobility.  They  also 
acknowledged  the  importance  of  addressing  the  issues  in  the  current  debate  on  labour 
mobility to avoid that free movement becomes an even more contentious issue that it already 
is.  However,  they  insisted  on  the  importance  of  preserving  the  principle  of  equal  treatment, 
especially for those more vulnerable. 

Also,  participants  underlined  the  importance  of  adopting  non-legislative  measures,  arguing 
that several barriers to free movement of workers linked to social security coordination are the 
result of incorrect/non application of existing rules, or to the fact that the cooperation between 
Member  States,  envisaged  by  the  2010  reforms  of  SSC  rules,  has  not  been  strengthened 
enough yet.  

Access  to  the  labour  market  for  mobile  EU  workers  and  jobseekers  was  mentioned  as  a 
specific  issues  that  the  Commission  needs  to  look  at:  specific  examples  were  provided  by 
participants about administrative barriers (notably for jobseekers in Scandinavian countries), 
and recognition of professional qualifications was also mentioned as a barrier. Also, the issue 
of  destitution  of  migrant  workers  was  mentioned  as  a  major  issue,  often  resulting  in 
homelessness. 

In relation to unemployment benefits, participant expressed their support to the extension of 
the  period  of  their  exportability,  in  view  of  the  time  needed  to  find  a  job,  and  of  existing 
administrative barriers.  

In  relation  to  export  of  family  benefits,  some  participants  recognised  the  need  for  some 
compromise  in  view  of  the  position  of  some  MS  opposing  export,  which  would  entail  the 
(dynamic) adaptation of exported family benefits to the living conditions of the country where 
the  children  of  the  workers  reside.  Others  underlined  the  unfairness  of  adaptation,  since  the 
workers concerned pay the same taxes, but also the fact that, for the competent MS, adapting 
family benefits may prove anti-economical if the concerned families were to move to the MS 
as a result. In this sense, it was mentioned that the biggest challenge for local authorities is 
represented by pressure on public services, and not by "benefit tourism". 

In relation to long-term care benefits, participants expressed support to the idea of creating a 
specific  chapter  for  their  coordination,  underlining  that  they  should  be  exportable,  but  also 
warning against endangering the important link between healthcare and social care. 

Written  contributions  were  also  received  from  EURODIACONIA,  recommending  to  extend 
the  duration  of  the  export  of  unemployment  benefits;  and  from  ECAS,  recommending  to 
provide  explicitely  for  the  exportability  of  long-term  benefits;  to  extend  the  duration  of  the 
export  of  unemployment  benefits;  to  ensure  full respect  for  the  principle  of  equal  treatment 
give in the reform of the rules on family benefits. 

479  European  Citizen  Action  Service  (ECAS);  European  Disability  Forum;  Conference  of  European  Churches;  EURODIACONIA; 
Confederation of Family Organisations in the European Union; Advice on Individual Rights in Europe; Friedrich-Ebert-Stiftung; European 
Anti Poverty Network; European Solidarity Network; Europeans Throughout the World; l’Association Européenne de la Pensée Libre; 

EN 

xxv 

   EN 

 
                                                 
5.  Public consultations 

a)  EU Citizenship Report 

Relevant  results  of  the  public  consultation  on  the  extenstion  of  the  right  to  unemployment 
benefits in the framework of the EU Citizenship Report480 have also been taken into account 
with regard to the export of unemployment benefits. 

b)  Online  consultation  on 

long-term  care  benefits  and 
unemployment  benefits  (export  of  unemployment  benefits  and  coordination  of 
unemployment benefits for frontier workers)  

the  coordination  of 

The European Commission launched an online consultation on the coordination of long-term 
care benefits and unemployment benefits (export of unemployment benefits and coordination 
of  unemployment  benefits  for  frontier  workers)  on  5  December  2012  to  which  299  replies 
were  received.  199  of  the  replies  received  were  from  individuals  and  100  on  behalf  of  an 
organisation  or  as  specialists.  Both  individuals  as  well  as  organisations  (including  Member 
States' authorities,  trade unions and non-governmental organisations and private companies) 
from the EU and EEA-EFTA States replied to the public consultation.  

The content of these replies has been taken into account in the overall analysis and included in 
the  statistics  whenever  possible  (they  did  not  contain  full  replies  to  all  questions  in  the 
consultation). Not all respondents gave full replies to the consultation and the replies are only 
reflected in the results to the extent that a reply was received to a particular question. 

By  nationality,  Spanish  were  the  most  numerous  among  individual  respondents,  accounting 
for  26.6%  of  the  responses.  No  replies  were received  from  persons  from  Cyprus,  Denmark, 
Iceland, Luxembourg and Malta. 

Stakeholder category 

Number of replies 

Percentage 

National administration 
Social partner / Trade union 
Civil society / Non-
governmental organisation 
Company 
Unknown 

67 
19 

11 

2 
1 

Coordination of unemployment benefits 

67% 
19% 

11% 

2% 
1% 

In  relation  to  the  coordination  of  unemployment  benefits,  the  consultation  provided  some 
evidence of the diversity of  opinions among individuals and different types of stakeholders. 
National  administrations  often  had  different  opinions  than  the  social  partners,  trade  unions, 

480 Action 1 in the  Report from the Commission to the European Parliament. The Council, the European Economic and Social Committee 
and  
the Committee of the Regions, EU Citizenship Report 2013: EU citizens: your rights, your future, COM (2013) 269 final. See  
http://ec.europa.eu/justice/citizen/files/eu-citizen-brochure_en.pdf. 

EN 

xxvi 

   EN 

 
 
 
 
 
 
                                                 
civil society and non-governmental organisations. The combination of all opinions allows for 
a comprehensive view of the current system of coordination of unemployment benefits in the 
EU, including what are perceived to be the main problems and shortcomings perceived, and 
what the possible options are for reform. 

Almost  half  of  the  respondents  (49%)  were  in  favour  of  giving  the  unemployed  person  the 
right to choose to claim unemployment benefits in the Member State of last employment, or 
in the Member State where the person lived during his/her last period of employment (where 
these Member States were different). The second most commonly chosen option (40% of the 
individual  respondents)  was  that  the  unemployed  person  should  have  to  apply  for 
unemployment benefits in the Member State where he/she last worked and paid contributions, 
even  if  he/she  lived  in  another  Member  State.  In  third  most  commonly  chosen  option  (far 
behind the first two in terms of percentage of respondents), selected by 7% of the participants, 
was  the  option  where  unemployed  workers  should  claim  unemployment  benefits  in  their 
country of residence, even if they last worked and paid social security contributions in another 
Member State.  

Options 

The Member State where the person last worked 
and  paid  social  security  contributions,  even  if 
he/she lived in another Member State. 

The  Member  State  where  the  person  has  lived, 
even  if  he/she  last  worked  and  paid  social 
security contributions in another Member State. 

The  person  should  be  allowed  to  choose  to 
claim the benefit either in the Member State of 
last employment or in the Member State where 
the  person  has  lived  (if  these  Member  States 
were different). 

Number 
of replies 

72 

13 

% of 
Individual 
replies 

40,22% 

7,26% 

87 

48,60% 

Other solution 

7 

3,91% 

Individuals and organisations at large shared some views with regard to which Member State 
should be the Member State competent for  the provision of unemployment benefits. Only a 
small share of both groups (and, within organisations, of each type of stakeholder) considered 
that the country of residence should be the competent Member State. Individuals were rather 
divided between preferring a right of choice for mobile workers (49% of replies) and making 
the country of last activity competent (40%). The same two options were clearly preferred by 
organisations, but in reverse order. National administrations (47% of them) and civil society 
organisations  and  NGOs  (78%)  were  more  often  in  favour  of  making  the  country  of  last 
activity competent, while social partners and trade unions (47%) preferred the right of choice 
option). 

EN 

xxvii 

   EN 

 
With regard to the export of unemployment benefits, individuals favoured the export until the 
end  of  the  person’s  entitlement  (59%)  of  them.  This  option  also  received  support  among 
organisations  (34%  of  national  administrations  and  56%  of  civil  society  organisations  and 
NGOs),  although  less  than  the  maintenance  of  the  current  rules,  which  were  the  preferred 
option by national administrations (42% of them) and social partners and trade unions (76%). 
One option received less support across the respondents (export for at least six months).  

Options 

For three months, with a possible extension up to six 
months (the current situation under EU law) 

For at least six months 

the  end  of 

Until 
to 
unemployment benefits, according to the rules of the 
Member State which provides them 

the  person's  entitlement 

Number of 
replies 

43 

28 

%  of 
Individual 
replies 

24,02% 

15,64% 

105 

58,66% 

Other solution 

3 

1,68% 

Therefore,  for  both  questions  making  the  country  of  residence  competent  for  paying 
unemployment  benefits  an  export  unemployment  benefits  for  at  least  six  month  where  the 
least preferred options and opinions were fairly divided among two other options.  

Coordination of long-term care benefits 

A  total  of  127  individual  responses  and  45  responses  on  behalf  of  national  authorities,  an 
organisation  or  as  a  specialist  were  received  for  the  part  covering  the  coordination  of  long-
term  care  benefits.  The  results  of  the  public  consultation  highlight  the  diversity  of  opinions 
regarding  the  Member  State  competent  for  providing  long-term  care  benefits.  Opinions  on 
these questions varied both across individuals and among stakeholders.   

a) Individuals' replies 

For individuals, the preferred option was for entitlements to be equal to those in the country of 
insurance  (39%),  but  two  other  options  (namely:  entitlement  to  be  equal  to  those  in  the 
country of residence; maintenance of the current rules) gathered almost 20% of the support. 
Options where the introduction of a supplement to the long-term care cash benefits is foreseen 
gathered respectively: 14% if benefits provided by the competent State and 6% if provided by 
the Member State of residence. 

Opinions  on  the  competent  Member  State  and  on  the 
level of LTC to be provided 

Number of 
requested 
records 

% 
Requeste
d 
records(1
27) 

Should  continue  receiving  benefits  as  it  is  today 
(depending on the Member States' legislation the person 

23 

18,11% 

EN 

xxviii 

   EN 

 
 
 
Opinions  on  the  competent  Member  State  and  on  the 
level of LTC to be provided 

Number of 
requested 
records 

% 
Requeste
d 
records(1
27) 

might end up in a win or in a lose situation). 

Should  be  treated  equally  in  the  Member  State  where 
he/she  is  insured  and  should  not  have  his/her  care 
benefits  reduced  if  he/she  moves  to  another  Member 
State. 

lives  and  receive 

Should  be  treated  equally  in  the  Member  State  where 
he/she 
there 
(including  the  cash  benefits),  in  accordance  with  the 
national legislation. 

the  care  benefits 

Should get care benefits in cash from the Member State 
of  insurance,  supplemented  by  the  Member  State  of 
residence in case of more advantageous conditions (top-
up). 

Should get care benefits in cash from the Member State 
of  residence,  supplemented  by  the  Member  State  of 
insurance in case of more advantageous conditions (top-
up). 

Other solution 

49 

38,58% 

25 

19,69% 

18 

14,17% 

8 

4 

6,30% 

3,15% 

b) Replies by national administrations, social partners, NGOs and other organisations 
Opinions  among  organisations481  were  also  divided.  The  most-selected  option  was  that  the 
current  rules  be  maintained  (supported  by  36%  in  total),  but  based  largely  on  national 
administrations’ opinions (they accounted for 75% of these replies).  

Considered per type of stakeholders, the current rules were the preferred option by national 
administrations  (53%  of  replies).  Preference  among  social  partners  and  trade  unions  were 
quite spread among the different options, with some slight preference for the entitlements to 
be  equal  to  those  in  the  country  of  insurance.  Civil  society  organisations  and  NGOs  also 
showed  some  divergent  opinions  among  them,  with  the  most  often-selected  option  for  the 
entitlement to be equal to those in the country of residence. More insights could not be gained 
directly from the consultation, since there was no possibility to elaborate on the arguments for 
selecting each option.  

481 Including national authorities, social partners, NGOs and other types of organisations. 

EN 

xxix 

   EN 

 
 
 
                                                 
There  was  consensus  among  respondents  on  behalf  of  organisations  that  all  costs  for  care 
benefits  provided  to  an  insured  person  should  be  borne  by  the  Member  State  where  the 
migrant person is insured for healthcare or long-term care (67 %)482. 

Option 
A 

Option 
B 

Option 
C 

Option 
D 

Option 
E 

Option 
F 

National administration 

12 

social  partner 
union 

/ 

trade 

society 
civil 
governmental 
organisation (NGO) 

/  non-

Company 

unknown 

Total 

2 

1 

0 

1 

4 

4 

2 

0 

0 

16 

10 

2 

2 

4 

1 

0 

9 

3 

1 

1 

0 

0 

5 

1 

3 

0 

0 

0 

4 

1 

0 

0 

0 

0 

1 

Total (%) 

35,56% 

22,22% 

20,00% 

11,11% 

8,89% 

2,22% 

c)  Online consultation on the aggregation of unemployment benefits and on the export 

of family benefits  

DG  EMPL  launched  an  online  consultation  on  the  coordination  of  unemployment  benefits 
(aggregation rules) and on the coordination of family benefits (export rules), which ran from 
15 July 2015 until 7 October 2015483.    

307  responses  have  been  received  from  199  individuals  and  108  organisations  (public 
authorities;  workers'  organisations;  NGOs;  employers;  SMEs;  companies;  think-tanks…) 
from 25 Member States. Hereunder an overview of the outcome of the consultation. 

Export of family benefits 

As it can be seen in the table below, around a third of the respondents believe that the current 
rules on the export of family benefits should be changed. 

482 This question was not included in the part of the questionnaire addressed to the individuals. 
483http://ec.europa.eu/social/main.jsp?catId=333&langId=en&consultId=16&visib=0&furtherConsult=yes   

EN 

xxx 

   EN 

 
 
 
 
                                                 
A  number  of  comments  and  proposals  for  possible  changes  of  the  rules  on  the  export  of 
family benefits were also made: 

•  Mixed views on indexation to country of residence of child 
•  Member State of residence of child should be competent 
•  Harmonisation/Unification of European Social Security Schemes 
• 
Improvements to the accessibility and simplicity of scheme 
• 
Improved speed of processing of claims 
•  Special provisions for single parents and family breakdown/remarriage 
•  Concerns about inter-dependency between between social security and taxation 
•  Clarification  of  certain  concept  e.g.  "benefits  of  the  same  kind";  "family  members"; 
"mainly dependent on the insured person" distinction between family benefits and SNCBs 

Aggregation of unemployment benefits 

As  it  can  be  seen  in  the  table  below,  more  than  a  third  of  the  respondents  believe  that  the 
current rules on the aggregation of unemployment benefits should be changed. 

EN 

xxxi 

   EN 

 
 
 
 
 
A number of comments and proposals for possible changes of the rules on the aggregation of 
unemployment benefits were also made: 

•  General support for concept of minimum qualifying period (3 months to 5 years) before 

aggregation provided former MS pays benefit 

•  General support for extension of period of export for benefit (6+6 months) 
•  Some support for right of choice for where to claim unemployment benefits 
•  Proposal that EU should harmonise/unify unemployment benefits 
•  Benefits to be calculated on the entirety of qualification period 
• 
•  Mandatory deadlines for administrative procedures 
•  Robust procedures to combat fraud 

Improved accessibility of information 

EN 

xxxii 

   EN 

 
 
 
 
12. Annex III  Who is affected and how 

EN 

xxxiii 

   EN 

 
 
The Annex is based on the preferred options (see section 8. of the main report) and presents 
the  practical  implications  for  individuals  and  public  administration  that  will  be  the  most 
affected by the initiative. 

Long-term care benefits 

The  preferred  option  consists  of  coordination,  following  the  same  logic  as  with  sickness 
benefits,  but  adding  clarifications.  The  competent  Member  State  provides  long-term  care 
benefits in cash and reimburses the cost of benefits in kind provided by the Member State of 
residence. This legislative proposal would have no impact on rights as such: it would merely 
reflect  the  already-applied  rules  on  sickness,  while  complementing  the  sickness  rules  with 
some specific rules that take account of the characteristics of long-term care benefits. 

a) Public administration  

The information obligations for administrations under this option will remain unchanged. The 
option could reduce disputes between institutions. In an initial phase the new legal definition 
and  the  in-or  exclusion  of  long-term  care  benefits  in  the  definition  can  increase  the 
administrative  burden  for  Member  States  and  impact  the  exchange  of  information  between 
Member States. In the long term, the clarification would save time and money spent per case 
by the Member States, especially in light of increasing demand for long-term care benefits. 

b) Individuals  

The clarification will enable EU mobile citizens to receive all the long-term care benefits to 
which they are entitled while exercising their right to free movement. It will also contribute to 
expediting the process by which persons that require care receive the benefits to which they 
are  entitled,  by  removing  much  of  the  uncertainty  or  conflicts  on  the  part  of  the  Member 
States involved over the status of the various long-term care benefits. 

Unemployment benefits 

Competence for paying unemployment benefits to frontier and other cross-border workers 

EN 

xxxiv 

   EN 

 
 
 
 
 
  
 
 
 
 
 
 
 
 
The competence for paying unemployment benefits will switch from the State of residence to 
the  State  of  last  activity,  if  the  frontier  and  other  cross-border  workers  have  worked  in  that 
State for more than 12 months.  

a) Public administration  

The number of cases handled by the employment services in the State of last activity can be 
expected to increase while it will decrease in the State of residence. Except for the changes in 
the number of cases, no further changes in the administrative procedures/tasks are expected in 
comparison to baseline under which – as a rule – this information is anyway required for the 
purpose  of  determining  whether  the  qualifying  period  for  a  right  to  benefits  under  the 
legislation of the State residence had been completed. 

This  option  may  result  in  more  cases  of  export,  whenever  a  frontier  worker  for  whom  the 
competence  has  switched  from  the  State  of  residence  to  the  State  of  last  activity  prefers  to 
focus the search for employment in the State of residence and therefore wants to register with 
the employment service located in that State. The administrative procedures for the export of 
unemployment benefits are established and therefore the only change expected inthis respect 
is the potential number of cases. 

b) Individuals  

The length of insured employment will be certified by means of the PD U1 and this will also 
enable the worker and the employment services to determine the competent institution. There 
will be no need for them to provide additional information. 

Aggregation of periods of insurance or (self-)employment 

Mobile workers will no longer be able to rely on the aggregation of periods completed in the 
Member  State  of  previous  activity  if  they  have  worked  for  less  than  three  months  in  the 
Member  State  of  last  activity.  However,  in  this  situation,  the  Member  State  of  previous 
activity  becomes  competent.  This  means  that  the  competence  for  paying  unemployment 
benefits will switch from the State of last activity to the State of previous activity for mobile 
workers who have workerd less than 3 months in the State of last activity. 

a) Public administration  

The number of cases handled by the employment services in the State of previous activity can 
be  expected  to  increase  while  it  will  decrease  in  the  State  of  last  activity.  The  employment 
services  will  also  have  to  take  the  necessary  measures  to  provide  for  an  export  of  their 
unemployment  benefit  to  the  Member  State  of  last  activity  (e.g.  provide  the  person  with  a 
Portable  Document  U2),  while  the  employment  service  in  the  Member  State  of  last  activity 
will assume the task of assisting the worker in finding new employment. They will also have 

EN 

xxxv 

   EN 

 
 
 
 
 
 
 
 
 
to  assume  the  task  of  informing  the  employment  services  in  the  Member  State  of  previous 
activity whenever a mobile worker registers with them, who has not yet been insured for the 
required minimum period of three months.  

This option may result in more cases of export, whenever a mobile worker has not completed 
the  required  three-month  period  in  the  Member  State  of  last  activity.  As  the  administrative 
procedures  for  the  export  of  unemployment  benefits  are  established,  this  would  be  the  only 
change expected. 

b) Individuals  

There  is  no  change  for  the  individuals  as  they  continue  to  register  in  any  case  of 
unemployment with the employment service of the Member State of last activity. It is then the 
task of this institution to determine, whether it can provide the benefits based, if necessary, on 
aggregation or whether it has to refer the case to the employment service of the Member State 
of previous activity. 

Export of unemployment benefits 

The period for export of unemployment benefits is extended to a minimum period of 6 months 
with possibility of further extension up to the end of the entitlement period. 

a) Public administration  

The  employment  services  in  the  competent  State  can  be  expected  to  have  to  handle  more 
situatoinis in whichthe unemployment benefit is exported. This does not necessarily result in 
an increase of the administrtaive burden, as they do not have to assume the task of controlng 
the  person  duringthe  export  period.  As  before,  they  will  have  to  provide  the  unemployed 
persons with a Portable Document U2 and inform him or her about the duties to fulfil in the 
State to which they intend to go in order to look for employment. 

The employment services in the Member State to which the unemployed person went in order 
to  look  for  employment  will  have  to  register  those  persons  and  assist  them  in  their  job-
searching  activities.  Moreover,  the  reinforced  cooperation  mechanism  will  require  them  to 
report  regularly  on  a  monthly  basisto  the  competent  institution  on  the  follow-up  of  the 
unemployed  person’s  situation,  in  particular  whether  the  latter  is  still  registered  with  the 
emplyoment services and is complying with organised checking procedures.  

b) Individuals  

EN 

xxxvi 

   EN 

 
 
 
 
 
 
 
 
 
 
 
Unemployed persons have to register with the employment service of the State to whichthey 
went in order to look for employment and provide all relevant information as this has been the 
case so far. The only change is that the export can be granted for longer periods than before.  

Access  for  economically  inactive  mobile  EU  citizens  and  jobseekers  to  certain  social 
benefits 

The preferred option is the amendment of Article 4 of Regulation 883/2004 to make reference 
to the limitations in Directive 2004/38/EC. This option will merely codify existing case-law.  

a) Individuals  

For economically inactive EU mobile citizens and jobseekers this option would facilitate them 
to make an informed choice when exercising their rights to move to another Member State. At 
the same time it is likely to reduce litigation costs and legal advice costs.  

b) Public administration  

For  administrations  this  option  is  likely  to  reduce  litigation  costs  and  legal  advice  costs  as 
well as the number of requests for benefits. 

Family benefits 

a) Individuals 

The  baseline  scenario  would  have  no  direct  impact  on  citizens  and  require  no  additional 
procedural  steps.    However,  the  introduction  of  a  pan-European  Electronic  Exchange  for 
Social  Security  Information  (EESSI)  is  likely  to  increase  the  speed  and  efficiency  of 
processing time to the benefit of citizens.   

The  horizontal  option  c  is  in  general  likely  to  entail  reduced  administrative  procedures  for 
claimants  as  where  the  derogation  is  applied  the  process  will  be  aligned  to  normal  national 
procedures  resulting  in  a  predictable  level  of  income,  meaning  citizens  will  be  subject  to 

EN 

xxxvii 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
fewer  unexpected  changes  arising  from  periodic  adjustments  in  benefit  levels  in  another 
Member  State  with  a  reduced  risk  of  recovery  procedures.    However,  as  it  will  be  at  the 
discretion  of  Member  States  whether  or  not  they  choose  to  disapply  the  anti-accumulation 
rules, these benefits will not be experienced by all families.  Families will claim on the basis 
of  the  parent  with  direct  entitlement  meaning  there  is  a  simpler  procedure  with  no  need  to 
supply  data  for  hypothetical  calculation  of  salary  (although  a  small  number  of  parents  will 
lose derived rights). 

b) Public administration  

In  relation  to  the  baseline  scenario,  it  is  already  anticipated  that  regulatory  burdens  may  be 
mitigated by the implementation of EESSI, including the adoption of consistent protocols for 
administering  exchanges  of  information  on  export  of  family  benefits.    The  Administrative 
Commission Ad-Hoc Working Group for establishing the definition of data to be exchanged 
electronically  under  EESSI  in  the  field  of  family  benefits  is  currently  working  on  stream-
lining processes.  The Structured Electronic Document (SED) F001 – Request for determining 
competences  and  F002  Reply  for  determining  competences  have  been  developed  for 
establishing competence.  Specific exchanges may also be applied where there is a need for 
detailed  information  on  periods  of  employment  and  contribution  or  medical  information 
related to family benefits for a child or young person with a disability or health condition.484   

In relation to the horizontal option c, Member States will be entitled to award salary-related 
child-raising  allowances  to  EU  mobile  citizens  subject  to  the  applicable  legislation  in 
accordance with the normal rules under national legislation regardless of whether they have 
primary or secondary competence for awarding family benefits.  In particular, the secondary 
competent  Member  State  will  no  longer  be  required  to  include  such  benefits  (which  can  be 
subject  to  fluctuation)  within  the  calculation  of  the  differential  supplement.    Thereby 
simplifying the calculation procedure and avoiding need for periodic adjustments relating to 
changes  in  the  families  circumstances  or  salary  or  the  need  to  arrange  recovery  of  any 
overpayment that might arise from delays in communicating such changes of circumstance.   

There  will  no  longer  be  any  need  to  apply  a  hypothetical  calculation  in  relation  to  a  parent 
who does not have relevant income or earnings within the competent Member State but who 
asserts  a  derived  right  to  benefits  resulting  in  considerable  simplification  for  those  public 
administrations who recognise benefits on the basis of a derived right.485   

However, it may be anticipated that there is some increase in administrative tasks for Member 
States who seek to verify whether or not a benefit available in another Member State should 
be considered a child-raising allowance. 

484 EESSI Business Use Case: FB_BUC_01_Determine Competences 
485 In practice only four Member States recognise entitlement to child-raising allowances calculated with reference to salary or professional 

income on the basis of derived rights. Annex XXV p14 

EN 

xxxviii 

   EN