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New provisions concerning the co-ordination of social security schemes Reg. 883/2004. Competences under the Treaty. No harmonisation National competence to define and build social policy schemes remains unchanged, except Ban on discrimination Equal treatment of women and men

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competences under the treaty
Competences under the Treaty

No harmonisation

National competence to define and build social policy schemes remains unchanged, except

  • Ban on discrimination
  • Equal treatment of women and men
  • Free movement of persons, goods and services
  • Competition and State aid rules
  • Public procurement

Only co-ordination?

what is co ordination
What is Co-ordination?
  • Equal treatment
  • Export of benefits
  • Aggregation of periods

Legal base in the Treaty – frequent changes!

Maastricht: Art. 51 + Art. 235 (self employed)

Amsterdam: Art. 42 + Art. 18 (Union citizens) + Art. 308 (self employed)

Nizza: Art. 42 + Art. 308 (Union citizens + self employed) + Art. 63 Abs. 4 (third country nationals)

European Constitution: Art. III-136 + Art. III-267 (third country nationals)


Reg. 1408/71 already aged !

Ø does not cover new risks (long term care, child care)

Ø centred around gainful activities

Ø Parallelism Reg. 1408/71 – ECJ Reg. 1408/71 – Reg. 1612/68

Start: European Council of Edinburgh (1992)

SLIM - Simpler Legislation for the Single Market

start of the work
Start of the work

Proposal of the Commission December 1998

Revolutionary changes:

Ø open material and personal scope 

Ø far reaching equalisation of facts 

Ø pro-rata-reimbursement for pensioners 

Ø 6 Months export of unemployment benefits 

Ø Unemployment benefits for frontier workers by the last state of employment 

Ø Always highest amount of family benefits

how far did we get
How far did we get?

When will the new Reg. 883/2004 enter into force?

on the 20th day after its publication – 27.6.2004 

When will 883/2004 apply?

From the entry into force of the new Implementing Reg.

possible impediments on the way to new Reg. 883/2004  

  • Elaboration of the new Implementing Reg.
  • 10 new Member States 

Ø Missing Annex X (special non contributory besenfits) 

Ø Missing Annex XI (special provisions)

personal scope of reg 1408 71
Personal scope of Reg. 1408/71

Employed and self-employed persons, students, if they are nationals of a Member State, refugees or stateless

Members of the family irrespective of their nationality

Employed and self-employed have to be covered by a national scheme of social security

personal scope of reg 883 2004
Personal scope of Reg. 883/2004

All persons covered by a scheme

Nearly no influence on social insurance schemes

Third country nationals remain excluded

  • legal base!!

Reg. 859/2003 remains applicable -> therefore

For third country nationals Reg. 1408/71 remains in force in its present form

third country nationals reg 859 2003
Third country nationals Reg. 859/2003

Already applicable – Reg. 1408/71 applies correspondingly


  • Third country nationals legally residing in the territory of a Member State
  • cross border elements

Does not apply in relation to DK, special provisions concerning family benefits granted by AT + DE

schemes beyond employment
Schemes “beyond employment”

All persons subject to the legislation = all persons covered

All schemes covering the risks

Invalidity / sickness / death

Exemption of victims of war still valid

Possible impacts - Annex XI?

  • Damages caused by officials or military actions
  • Schemes for victims of crime
  • Insurance burden provisions
material scope reg 1408 71
Material scopeReg. 1408/71

Legislation concerning:

  • Benefits in case of sickness and maternity
  • Benefits in case of old age, invalidity or to survivors
  • Benefits in case of accidents at work and occupational diseases
  • Death grants
  • Unemployment benefits
  • Family benefits
material scope reg 883 2004
Material scope Reg. 883/2004

Not very much innovation


  • Paternity benefits equivalent to maternity
  • Pre-retirement benefits
  • Explicit exemption of advances of maintenance payments
  • Inclusion of all special schemes for the “Liberal professions”

No solution: 

  • Special provision for long term care benefits
  • Special provision for child care benefits
  • Freedom to provide services (patient mobility)
pre retirement benefits
Pre-retirement benefits

What exactly is meant?

Old age part-time? Not clear because in many Member States benefits to the employer, not to the employee

Cases Kutz-Bauer und Steinicke – Working conditions under Dir. 76/207

Therefore not at the same time social security?

In any way - No aggregation!

advances of maintenance payments
Advances of maintenance payments

Cases Offermanns und Humer – AT “Unterhaltsvorschuss” covered by Reg. 1408/71

Problems in case of residence of the child outside the competent state

Big success: Advances to maintenance payments excluded from Reg. 883/2004 (Annex I)

Therefore no export but equal treatment (Art. 12 EC - Cases Cowan, Martinez Sala)

long term care benefits
Long term care benefits

Cases Molenaar und Rs Jauch – sickness benefits

No special provision

Nevertheless hope?

  • Art. 34 to avoid overlapping; deducting the benefit in kind from the benefit in cash
  • Annex X – special non contributory benefits – case Hosse; pressure to elaborate a special chapter on co-ordination for such benefits
long term care benefits possible ways of co ordination
Long term care benefits - possible ways of co-ordination
  • Export of cash benefits only through the institution of the place of residence
  • This institution has the obligation to inform the persons concerned
  • This institutions deducts the amount of the benefit in kind
  • Corresponding deduction of reimbursement (special provision in case of lump sums)
  • Important: Overpayments have to be avoided
child care benefits
Child care benefits

No special provision

Co-ordination problematic (e.g. child care in DE, mother frontier worker from AT still in employment)

  • Family-view (like all other family benefits)
  • Individualised-view

ECJ: Family view correct - case Dodl and Oberhollenzer

special non contributory benefits
Special non contributory benefits

New Definition (Art. 70):

  • In case of supplementary, substitute or ancillary coverage – minimum income
  • In case of benefits solely for the protection for the disabled – link to the social environment

Non contributory – no financing by contributions; no problem for supplementary benefits to contributory benefits

equal treatment of facts
Equal treatment of facts

New provision (Art. 5):

(lit. a): equal treatment of benefits and income – corresponds to Art. 12 (2) of Reg. 1408/71

(lit. b): general equalisation

“where under the legislation of the competent Member State legal effects are attributed to the occurrence of certain facts or events, that Member State shall take account of like facts or events occurring in any Member State as though they had taken place in its own territory.”

equal treatment of facts consequences
Equal treatment of facts Consequences
  • Danger: e.g. creation of periods of insurance
  • Therefore: no impact on aggregation (Rec. 10) or on competences (Rec. 11)
  • Important: one provision for all Member States
  • ECJ up until now always in that direction
  • Legal simplification
equal treatment of facts limits
Equal treatment of factsLimits


Child care periods in pension insurance

Child care whenever in any Member State?

Important: Connection with competence (always state of residence?)

Is correction of case Kauer possible?

There are only very few possibilities for deviations

Important: Annex XI


Central uniform provision (Art. 6)

In case of voluntary insurance no restriction to persons who have been already gainfully active in that Member State

Via equalisation of facts: equivalent periods could be created by foreign periods of insurance

Impact e.g. on periods of military or civilian service,

School or university studies if equivalent periods under national legislation

applicable legislation reg 1408 71
Applicable legislation Reg. 1408/71

Insurance only in one Member State allowed – various designations of competent State

  • place of gainful activity
  • posting for a maximum of 12 months
  • prolongation for further 12 months
  • normally exercise of an activity in more than one Member State -> State of residence
  • problems in case of termination of the activity
  • agreement on exceptions
applicable legislation reg 883 2004
Applicable legislation Reg. 883/2004

Most important changes:

  • Legislation of the previous state of activity in case of receipt of short term benefits in cash
  • For all non active persons the legislation of the state of residence applies
  • 24 months of posting (no E 102 any more)
  • Normally exercise of an activity in more than one Member State: legislation of State where a substantial part of activity is exercised
applicable legislation problems
Applicable legislation - Problems

Unsolved problems:

  • Retroactive corrections to achieve lawful status
  • Impact of labour law and workers protection on social security
  • Obligation of employer without any representation in the state of exercise of the activity to information and to pay the contributions
sickness benefits reg 1408 71
Sickness benefitsReg. 1408/71
  • Benefits in kind under the legislation of the state of residence or stay
  • No special provisions for entitlement under the freedom to provide services
  • Benefits in cash under the legislation of the competent state
sickness benefits reg 883 2004
Sickness benefitsReg. 883/2004

Important amendments (including those brought by Reg. 631/2004 to Reg. 1408/71)

  • Equalisation of entitlements for all persons (already since 1.6.2004)
  • European Health Insurance Card (already since 1.6.2004)
  • More rights for frontier workers
  • New cost reimbursement provisions
  • But again no codification of rights under the freedom to provide services
equalisation of entitlements
Equalisation of entitlements

No difference between employed or self-employed persons / pensioners / stay abroad of employed persons / students / holidays (since 1.6.2004)

Entitlement depends on nature of the benefit and the expected length of the stay

Direct contact to the service providers (doctors, hospitals) abroad (since 1.7.2004)

E 112 authorisation has to be granted if treatment cannot be given within a time-limit which is medically justifiable (Reg. 883/2004)

european health insurance card
European Health Insurance Card

New since 1.6.2004: EHIC or replacement form

States with transition period (AT, IT, LV, LT, MT, NL. PL, PT, SK, HU, UK, CY) – introduction at the latest an 1.1.2006

In many Member States combination with national cards

Since 1.6.2004 in any case new E 111; after end of transition period for a Member State: Replacement form

more rights to frontier workers
More rights to frontier workers

Family members (like active frontier workers) automatic choice between benefits in state of residence or employment –if no restriction in Annex III

Retired frontier workers: right to continue treatments already begun in state of employment

Retired frontier workers: continued right of choice if frontier worker during 2 years of the last 5 years and entry in Annex V

More rights also for pensioners who receive treatment in the competent state – entry in Annex IV


Fight against inequalities especially in case of pensioners

Principle: real cost refund

Lump-sum of 85 %, state of residence costs of E 112, competent state pays all other benefits

Lump-sum of 80 %, if competent state pays all benefits in its territory (Annex IV), E 112 costs by state of residence, competent state pays all other costs of treatment outside the state of residence

pensions reg 1408 71
PensionsReg. 1408/71

Important principles:

  • Aggregation for entitlement
  • If aggregation is necessary: calculation of theoretical amount for all periods and then pro-rata
  • If aggregation is not necessary: national or pro-rata-pension (highest amount)
  • Insurance periods < 12 months – other state has to pay
  • Equalisation of requests
accidents at work and occupational diseases reg 1408 71
Accidents at work and occupational diseases - Reg. 1408/71

Benefits in kind (e.g. treatment after an accident) – same principles as in case of sickness

Accident pensions are paid by the state where the accident occurred or in which the last period of exposition is reckoned

Internal pro-rata of costs in case of special lung diseases (sclerogenic pneumoconiosis)

pensions and accidents at work or occupational diseases reg 883 2004
Pensions and accidents at work or occupational diseases - Reg. 883/2004

No major amendments

Accident insurance: No pro-rata in case of sclerogenic pneumoconiosis

Pensions: Equalisation of requests still open if information is missing

Pensions: Anti-Cumulation: partition of deductible amount and not any longer of the amount of the benefit which will be suspended

Pensions: Problems with national reforms (funded schemes)

unemployment benefits reg 1408 71
Unemployment benefitsReg. 1408/71

Exportation: max. 3 months; receipt of benefits in previous state of employment for 4 weeks, return, otherwise loss of entitlement

Frontier worker: unemployment benefit under legislation of state of residence

Seasonal workers: either stay in state of employment, export of unemployment benefit for 3 months or immediately unemployment benefit from state of residence

unemployment benefits reg 883 2004
Unemployment benefitsReg. 883/2004

Exportation: same conditions, but 3 + 3 months

Frontier workers: unemployment benefit from state of residence but search of employment also in previous state of employment

Seasonal workers and frontier workers: reimbursement of unemployment benefit by previous state of employment: 3 months + 2 months (if insurance 12 months during last 24 months)

family benefits reg 1408 71
Family benefits - Reg. 1408/71

Difference between active persons (all family benefits) and pensioners (only family allowances)

Priority of gainful activity over residence

Differential amount by state which has not the priority

family benefits reg 883 2004
Family benefits - Reg. 883/2004

Clear new provision, identical for all persons for all benefits – residence is not relevant

Clear hierarchy of competences

  • Gainful active persons
  • Pensioners
  • Entitlement only due to residence
  • In case of entitlements of the same type - residence
  • Suspended competence: differential amount
different other amendments by reg 883 2004
Different other amendments by Reg. 883/2004

Also in other fields essential amendments:

  • Replacement of data exchange by electronic exchange
  • Collection of contributions and recovery of undue benefits directly applicable
first assessment
First assessment

Has the simplification been successful?

  • XI in stead of VIII Annexes!
  • Various possibilities for options in sickness insurance
  • Complex provisions in the field of unemployment
  • No solutions for new social risks, unresolved questions
  • Decisions of ECJ not all transformed

+ Central provision on equalisation of facts

+ Central provision on aggregation

+ Provisions and Annexes simplified

+ Start for special co-ordination of long term care benefits

farewell to reg 1408 71
Farewell to Reg. 1408/71?

No! Complex parallelism of Reg. 1408/71 and Reg. 883/2004

Reg. 1408/71 remains applicable for:

  • Reg. 859/2003 concerning third country nationals
  • EEA-Agreement
  • Agreement on free movement in relation to CH
  • Reg. 1661/85 concerning Greenland

No farewell to Reg. 1408/71 – but farewell to simplification!