Fri. Sep 29th, 2023

Coordination of social security: Commission calls on GERMANY to comply with EU rules on social security coordination and on free movement of workers

The Commission has decided to send a reasoned opinion to Germany (INFR(2021)4039) for failing to comply with the EU rules on social security coordination (Regulation (EC) No 883/2004) and on the free movement of workers (Regulation (EU) No 492/2011 and Article 45 of the Treaty on the Functioning of the European Union (TFEU)).

The German State of Bavaria introduced a new scheme of family allowances for residents of Bavaria with young children (up to 3 years old). Under this scheme, EU nationals whose children reside in one of the 15 Member States where the cost of living is lower than in Bavaria receive only a reduced amount of the benefit. The Commission raised concerns that this legislation breaches EU law and constitutes unjustified indirect discrimination based on the nationality of migrant workers. Moreover, this legislation breaches EU rules on the free movement of workers and on social security coordination. EU workers, whose children reside permanently in another Member State, should be entitled to the same family benefits as other workers in Bavaria. In June 2022, the Court of Justice of the European Union ruled in case C-328/20 that an Austrian child benefit scheme, which was very similar to the one in Bavaria, was not in line with EU law. This ruling confirmed the Commission’s position.

The Commission sent a letter of formal notice to Germany in November 2021. Germany replied to the Commission’s letter in March 2022. Since the Commission considers that the reply does not satisfactorily address its concerns, it is sending a reasoned opinion. Germany now has two months to take the necessary measures, otherwise, the Commission may decide to refer the case to the Court of Justice of the European Union.

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