On 20 June 2024, the Court of Justice of the European Union (CJEU) ruled on a request for a preliminary ruling submitted by the Rechtbank Den Haag (District Court of The Hague) in case C-540/22 regarding the compliance of Dutch law with the freedom to provide services in the European Union, addressing the issue of whether Ukrainian citizens posted from one EU country to another must obtain an additional residence permit in the host country.

Posting of Ukrainian citizens for more than 90 days

In the case at hand, Ukrainian workers were posted by a Slovak service provider to perform work in the Netherlands. The duration of their work was extended, exceeding 90 days within a 180-day period. Under Dutch law, in such situations, third-country nationals are required to hold a residence permit specifying its period of validity and the cost of obtaining it. Consequently, the Dutch court referred the case to the CJEU to determine whether national provisions requiring a residence permit after 90 days are consistent with the EU freedom to provide services.

The main points of dispute were:

1. The obligation to apply for a residence permit – the applicants contested the requirement to obtain an additional residence permit in the Netherlands after 90 days.
2. The validity period of permits – the Dutch residence permits were only valid as long as the Slovak residence permits, making them shorter than the period of employment.
3. Fees for permit applications – the fees charged for residence permit applications were five times higher than those for certificates of lawful residence for EU citizens, which the applicants deemed excessive.

Through the preliminary questions, the referring court essentially sought to determine whether Articles 56 and 57 TFEU should be interpreted as precluding national provisions under which, where a service provider established in one Member State posts workers who are third-country nationals to another Member State for a period exceeding 90 days in any 180-day period, those workers are required to hold an individual residence permit in the latter Member State. Such a permit would be valid only for the same period as the residence and work permit issued in the first Member State, or in any case for no more than two years, and its issue would be subject to the payment of fees equivalent to those charged for ordinary work permits for third-country nationals.

Limiting the validity of work permits for posted workers

In the present case, the Secretary of State, taking into account the extension of the posting period, issued residence permits which were limited to the validity period of the Slovak residence permits, collecting the relevant fees. The applicants challenged this interpretation, invoking the principle of the freedom to provide services under Article 56 TFEU, arguing that such an obligation and its validity period should not be disproportionate. The CJEU held, however, that such national regulation may be justified if it serves to prevent illegal entry and residence, which is a legitimate objective in the general interest, such as maintaining public order and security. Workers employed by companies established in another Member State therefore cannot automatically benefit from access to the labour market of the host country if their stay exceeds 90 days within a 180-day period.

Additional fees

Regarding the amount of fees due for residence legalisation applications, the facts of the case showed that this amount was equal to the fees payable for an ordinary work permit for a third-country national – an amount five times higher than the fee for a certificate of lawful residence for an EU citizen. The applicants argued that such high fees hindered the freedom to provide services.

CJEU ruling

The CJEU emphasised that high fees for obtaining a residence permit may hinder the freedom to provide services, although it noted that EU law does not prohibit Member States from charging such fees. However, the key point is that such fees must not be disproportionate in light of the freedom to provide services as set out in Article 56 of the Treaty on the Functioning of the European Union (TFEU).

In the present case, Articles 56 and 57 TFEU should be interpreted as not precluding national provisions under which, where a service provider established in one Member State posts workers who are third-country nationals to another Member State for a period exceeding 90 days in any 180-day period, those workers are required to hold an individual residence permit in the host Member State. This permit may be limited in validity to the duration of the residence and work permit issued in the first Member State, or in any case to two years, and may be subject to fees equal to those for ordinary work permits for third-country nationals, provided such requirements are not disproportionate.

Practical conclusions

The CJEU ruling confirms that the Dutch requirement for additional residence permits for Ukrainian nationals in the host country is permitted, even when they already hold a residence title in the country of employment. Nevertheless, each case involving the posting of Ukrainian nationals from one EU Member State to another must be individually assessed to determine whether the conditions for legally working in the host country are met, including the possibility of exceptions from the requirement to obtain additional permits. Should you require assistance with posting Ukrainian nationals to another EU country, we invite you to contact us. We provide legal services to businesses, including online: https://atl-law.pl/delegowanie-pracownikow-i-zatrudnianie-cudzoziemcow/