On 20 June 2024, the Court of Justice of the European Union considered a reference for a preliminary ruling from the rechtbank Den Haag (The Hague District Court) in a case (C-540/22) on the compatibility of Dutch law with the freedom to provide services in the European Union resolving the issue of the permissibility of requiring Ukrainian nationals posted from one EU country to another EU country to have an additional residence permit in the country of posting.
Posting of Ukrainian nationals for a period of more than 90 days
In the case at hand, the Ukrainian workers were posted by a Slovak service provider to carry out work in the Netherlands. The duration of this work was extended, thus exceeding 90 days within a 180-day period. In such a situation, the Dutch legislation provides that third-country nationals should have a residence permit specifying the conditions for the duration of that permit and the costs of obtaining it. Thus, the Dutch court asked the CJEU whether national legislation requiring a residence permit beyond 90 days is compatible with the freedom to provide services under EU law.
The main points of dispute concerned:
- The obligation to apply for a residence permit – the applicants disputed the need for an additional residence permit in the Netherlands after 90 days.
- The duration of the permits – the residence permits in the Netherlands were only valid for as long as the Slovak residence permits, making them shorter than the duration of the works.
- Fees for permit applications – the fees charged for permit applications were five times higher than certificates of legal residence for EU citizens, which the applicants considered excessive.
By the questions referred for a preliminary ruling, the referring court seeks, in essence, to ascertain whether Articles 56 and 57 TFEU are to be interpreted as meaning that the abovementioned provisions preclude the provisions of the Treaty on European Union – national legislation under which, where a service provider established in a Member State posts workers who are nationals of a non-member country to another Member State for a period exceeding 90 days in any 180-day period, those workers are required to hold in the latter Member State an individual residence permit, the period of validity of which is limited to that of the residence and work permit issued in the first Member State and, in any event, to two years, and the acquisition of which is subject to the payment of fees equivalent to those payable for the normal work permit of a national of a non-member country.
Limiting the duration of posted workers’ work permits
In the present case, the Secretary of State, taking into account the extension of the working time of the posted workers, issued residence permits which he limited to the period of validity of their Slovak residence permits, charging the appropriate fees. The applicants challenged this interpretation on the basis of the principle of freedom to provide services set out in Article 56 TFEU, arguing that such an obligation and its validity period should not be disproportionate. However, the European Court considered that such national legislation may be justified if it serves to prevent illegal entry and residence, which is a relevant objective in relation to the general interest, such as ensuring public order and security. Workers employed by companies established in another Member State cannot therefore automatically enjoy the right to access the labour market in the country to which they are posted if their stay exceeds a period of 90 days within 180 days.
With regard to the amount of fees payable, it follows from the order for reference that this amount is equal to the fees payable for a simple work permit for a third-country national – an amount that is five times higher than the fees payable for a certificate of legal residence for a Union citizen, which the complainants raised by pointing out that the fees payable for obtaining a residence permit in the Netherlands are very high and impede the exercise of the freedom to provide services.
CJEU ruling
The CJEU emphasised that high fees for obtaining a residence permit can be an obstacle to the freedom to provide services, although it pointed out that Union law does not prohibit Member States from charging such fees. However, it is crucial that such fees are not disproportionate to the freedom to provide services, in accordance with Article 56 of the Treaty on the Functioning of the European Union (TFEU).
In the present case, it must be assumed that Articles 56 and 57 TFEU must be interpreted as not precluding national legislation according to which, when 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 within a 180-day period, those workers are required to hold an individual residence permit in that other Member State, the period of validity of which is limited to the period of validity of the residence and work permit issued in the first Member State, and in any case to two years, and the acquisition of which is subject to the payment of fees equal to those payable for a normal work permit for a third-country national, provided that these provisions do not impose disproportionate requirements.
Practical conclusions
It follows from the CJEU judgment that the Dutch practice of requiring an additional residence permit for Ukrainian nationals in the country of posting who already hold another residence title in the State of employment is permissible. Nevertheless, in each case of secondment of Ukrainian nationals from one EU State to the territory of another EU State, it is necessary to assess on a case-by-case basis the conditions for the possibility of legally performing work in the country of secondment, including the possibility of taking advantage of the exceptions for not obtaining additional permits in another EU country. If you need support in seconding Ukrainian nationals to another EU country, we invite you to contact us. We provide legal services to entrepreneurs also in remote form: https://atl-law.pl/en/posting-of-workers-and-employment-of-foreigners/