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After a round of protracted and difficult discussions at the February European Council Summit, David Cameron returned to the UK with a deal and the “Brexit” referendum date is set for June 23. Let’s take a look at the areas of the deal that are most relevant to migration and free movement, issues that are of critical interest to many of us.
The UK has historically had a special relationship with the EU:  not joining the Euro currency,  maintaining borders with the Schengen Area travel zone and opting out of certain European legislation linked to migration and social security. A recent influx of European workers, particularly those from Eastern Europe, has placed additional strain on the UK’s relationship with the EU. In-work benefits for low-paid workers are more generous in the UK than in many other EU countries, causing a disproportionately high number of low-paid EU workers to arrive in the UK each year. Many of those European workers send in-work and child benefits back to their home countries. Lastly, in-work benefits are payable even if the applicant has not previously worked in the United Kingdom and does not contribute as such to the benefits.  This known pull factor for low paid workers arriving from other EU countries has, amongst others, given rise to the growing movement that promotes leaving the EU.  
At the outset of negotiations Mr. Cameron sought to have a complete "emergency brake" on free movement obligations along with preventative measures for EU nationals to send child benefits to their home country and a complete limitation on in-work benefits for newly arrived EU workers. 
After last month’s negotiations, here's what the EU has agreed to:
  • Child benefits: Child Benefits paid to children residing in a Member State other than the Member State where the EU worker is paid may be indexed to reflect conditions in the Member State where the child resides.  This will only apply to new claims, until 2020 when all Member States may extend indexation to existing claimants.  Other exportable benefits, such as old-age pension, are specifically excluded.
  • In-work benefits: Rather than a complete emergency brake on migration, it was agreed that in exceptional circumstances a Member State may petition the Council for the authority to apply a brake on access to non-contributory in-work benefits for foreign EU workers for up to four years, beginning as a complete limitation but gradually increasing until full benefits are paid.  The authorisation would last for seven years. In the case of the U.K., the deal states that the Council is satisfied that the exceptional conditions requirement is met, setting the stage for the UK to immediately limit in-work benefits upon a vote to stay in the EU.
  • Free movement of EU citizens: The right to free movement for EU citizens may be limited by a broader range of causes that could be considered threats to public policy or security, namely the past conduct of an individual, even if that does not amount to a criminal record. Past conduct may be used as a preventative ground to determine a possible threat to public policy or security which may lead to limitation or exclusion from free movement rights.
  • Free movement of Non-EU spouses: In an attempt to address “marriages of convenience”, third country national spouses of EU citizens may be excluded from the right to free movement in an EU Member State if they had not lawfully resided in that state before marriage or who marry only after the EU citizen spouse has moved into the host Member State. Also, Member States may address cases where citizens have had stays in another Member State with the sole reason to have EU freedom of movement rights applied to their third country national spouses. In these situations, national immigration law, which will usually be more restrictive, could be applied to govern these cases.
It is important to note that these provisions can be applied by all Members States and are not limited to just the UK. This means that, should the UK vote to remain in the EU (a requirement for the proposed deal to take effect), other Member States will have the authority to index child benefits payments that are paid to children in the home country, request that the safeguard mechanism to limit in-work benefits be authorized or place the above limitations on free movement.
It remains to be seen what impact this deal will have on the UK voters, but it is clear that a vote to remain in the EU will have broad implications for all Member States, as these proposals could then take effect throughout the EU. Keep following our blog series to learn about Brexit, broader EU Reform and implications for business and investor immigration. And if you have any questions about EU reform proposals please contact Christine Sullivan or Marius Tollenaere.