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BREXIT news - the impact on those planning to move to France

Tuesday, 13 March, 2018
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CHFS BREXIT BULLETIN NO: 2

Planning a move to France: establishing the right to remain  -  Citizens’ rights

A full year after the shock of the Brexit Referendum and with only 20 months to go before default exit from the EU, negotiations have finally started on how the UK will leave. One of the first items on the agenda is the need to address the question of cross border citizens’ rights, both for those who hold them now as well as for individuals intending to move or work cross border for the first time post the date of exit.

On the 12th June, the EU was the first party to publish a position paper on the subject: “Essential Principles on Citizens’ Rights” (copy here).

The UK govt responded with their proposals on 26th June in a paper entitled “The United Kingdom’s exit from the European Union: safeguarding the position of EU citizens living in the UK and UK nationals living in the EU” (copy here).

Then, following meetings in the week commencing 17th July, both parties came up with a joint position statement: “Joint technical note on the comparison of EU-UK positions on citizen’s rights” (copy here). This identifies areas of common agreement, situations which are close to agreement but which lack clarity or enough detail to be classed as agreed and positions of disagreement which need material movement before the matter can be resolved. 

We have analysed both positions as well as the jointly issued update and this Bulletin summarises our findings in the context of UK citizens already resident in France or intending to move there.

It is important to note that these position papers are proposals only. Although there is common ground there are also many areas where differences exist. Some of these are fairly minor and are likely to be resolved without difficulty, however others are fundamental and could prove insurmountable – leading to exit without agreement. In such a scenario it is anyone’s guess as to the outcome. Possibilities include unilateral action without any regard to the actions of the other party or perhaps reciprocation only at the level of the lowest common denominator, (whichever institution applies the least favourable treatment being matched in such treatment by the other).

Consequently, where there is currently agreement, clients should not assume that this is now established for the post Brexit era. 

The most relevant area of agreement so far is that UK individuals who are already legally resident in France, under EU rules, (TFEU / “Treaty on the Functioning of the European Union”), before 29/03/2017 would have the right to remain.

There is also agreement that individuals who are not already legally resident in France by the date of exit, (presumably 29/03/2019), will not have an automatic right of residence thereafter.

Nothing is agreed yet on the status of individuals moving to France between April 2017 to 2019.

Similarly, there is no reciprocal social security agreement envisioned for people moving for the first time after exit. Only for those already resident or working in an EU27 state is there current agreement that they will retain certain social security rights currently provided by EU treaties.

The tables at the end of this bulletin summarise and compare the current main relevant position of the EU and UK Govt. Please note that our tables are not simply a facsimile of the table provided in the joint statement. Rather, they are an interpretation of all 3 official documents released to date which summarise the items we feel are most relevant to our clients and readers.

Preliminary Charles Hamer Conclusion on the Present Position Statements.

As are shown in the tables overleaf, there are differences between the EU and the UK regarding the exact date when the current EU rules on the rights of residence for new arrivals and on the definition of those who have accrued the right to reside prior to exit.

Nonetheless, it is clear that for those who are currently toying with the idea of moving to France, that it will be in your interests to consider bringing their plans forward if you wish to maximise your chances of being able to settle in France under present EU rules whilst securing the best of the UK state benefits on offer regarding pension entitlement and healthcare.

As matters stand, for clients or readers currently only  intending to move to France post Brexit there appear to be no special plans or reciprocation arrangements on the table, particularly regarding S1 related access to healthcare, indexation of UK state pension, aggregation of cross border NI periods to determine benefits or rights of residence.

If your plans are dependent on knowing tax liabilities, the relative cost of healthcare options or the sustainability of the retirement plan in light of needing to weigh up the benefits of bringing the move forward against facing the extra burdens associated with a post Brexit move, then please contact our office for information on how we can help clarify your situation.

The best initial points of contact are:

For taxation, healthcare and future conditions of French residence, contact:

Alex Romaine, Charles Hamer French Tax Services Ltd, alex@charleshamer.co.uk or

Emilie Mengin, Charles Hamer French Tax Services Ltd, info@charleshamer.co.uk

For retirement sustainability questions pre and post Brexit, contact:

Jon Pawsey, Charles Hamer Financial Services IFA, jon@charleshamer.co.uk

For mortgage financing matters contact:

Javier de Diego, Charles Hamer Financial Services IFA, enquiries@charleshamer.co.uk or

Alice Dimier, Charles Hamer Financial Services IFA. mortgages@charleshamer.co.uk

  Tables summarising the basic positions of EU and UK Govt following publication of their positions / proposals for the safeguarding of cross border citizen’s rights, (12/06/17 and 26/06/17 respectively).

Table 1: INACTIVE UK Citizens in the EU27 (Page 1)

ITEM

 

EU

UK

STATUS OF THE INDIVIDUAL PRE EXIT / SPECIFIED DATE

EU27 RESIDENT PRE EXIT  / SPECIFIED DATE

NOT CURRENTLY EU27 RESIDENT.  ARRIVAL IN EU27 POST EXIT / SPECIFIED DATE

EU27 RESIDENT PRE EXIT SPECIFIED DATE

NOT CURRENTY EU27 RESIDENT.  ARRIVAL IN EU27 POST EXIT / SPECIFIED DATE

 

 

 

 

 

Date of effect of agreement

Date of UK exit from the EU (expected 29/03/2019)

Date of UK exit from the EU (expected 29/03/2019)

A “Specified Date” This is currently unknown but between 29/03/2017 and the date of UK exit from the EU (expected 29/03/2019)

A “Specified Date”. This is currently unknown but between 29/03/2017 and the date of UK exit from the EU (expected 29/03/2019)

Ultimate post exit authority

regarding UK sourced entitlements

ECJ (CJEU) Court of Justice of the European Union

ECJ (CJEU) Court of Justice of the European Union

UK Supreme Court

UK Supreme Court

Right to acquire permanent residence / settled status?

YES. A lifetime right Including individuals who have previously resided in the EU27 or worked in the EU27 as a “Frontier Worker”[1] but do not do so at the date of exit

NO. Unless the  individual previously resided or worked as Frontier Worker in the EU27

  1. But continuing right dependent on remaining ordinarily resident (“Settled”) in the EU27. Assumes EU27 reciprocation of UK rules for UK citizens resident in the EU27. No objections made if EU27 rules are more generous than those of the UK
  1. Assumes EU27 reciprocation of UK rules for EU citizens resident in the UK. No objections made if EU27 rules are more generous than those of the UK

Cross Border Healthcare Rights (S1 and EHIC) as currently applied under EU regulation 883/2004

Maintained in full if any cross border rights accrued pre Exit even if no longer cross border resident at date of exit

  1. available if never previously resided or worked cross border. Or at least the document makes no commitment to  match current rights accrued under Regulation 883/2004 or even provide any rights for arrivals post the exit date

Maintained conditionally if resident in an EU27 state at the specified date and cross border entitlements are “ongoing”. This includes inactive “early retirees”[2]. 

  1. available. Or at least the document makes no commitment to match current rights accrued under Regulation 883/2004 or even provide any rights for arrivals post the specified date.

 

 

Table 1 (Cont’d): INACTIVE UK Citizens in the EU27 (Page 2)

Item

EU

UK

STATUS OF THE INDIVIDUAL PRE EXIT / SPECIFIED DATE

EU27 RESIDENT PRE EXIT  / SPECIFIED DATE

NOT CURRENTLY EU27 RESIDENT.  ARRIVAL IN EU27 POST EXIT / SPECIFIED DATE

EU27 RESIDENT PRE EXIT SPECIFIED DATE

NOT CURRENTY EU27 RESIDENT.  ARRIVAL IN EU27 POST EXIT / SPECIFIED DATE

 

 

 

 

 

Cross Border State Pension Rights as currently applied under EU regulation 883/2004

Maintained in full if any cross border rights accrued pre Exit even if no longer cross border resident at date of exit

  1. available if never previously resided cross border. Or at least the document makes no commitment to  match current rights accrued under Regulation 883/2004 or even provide any rights for arrivals post the exit date
  1. in full if resident in an EU27 state at the specified date. This includes indexation of the pension and aggregation of pre exit cross border contributory periods. A decision has yet to be made regarding post exit contributory periods.
  1. available. Or at least the document makes no commitment to match current rights accrued under Regulation 883/2004 or even provide any rights for arrivals post the specified date.

Treatment of Family Members (dependents and new spouses)

Maintenance of a right to reside with the qualifying family member and entitlement to the same family membership rights as EU citizens in the event that they do not qualify in their own right.

If the qualifying family member was already EU27 resident by the exit date then the family member acquires the same family membership rights as EU citizens even if they themselves arrive after the exit date.

If no family member was  EU27 resident by the exit date then no automatic rights of residence are accrued  by dependents or newly arriving spouses.

(Assuming EU reciprocity of UK proposals for EU citizens in the UK): Maintenance of a right to reside with the qualifying family member and entitlement to the same family membership rights as EU citizens in the UK in event that they do not qualify in their own right.

  1. EU reciprocity of UK proposals for EU citizens in the UK): If the qualifying family member was already EU27 resident by the exit date then if a child dependent or pre existing spouse joins the family post the Specified date, they acquire a right to “settled status” and acquire the same family membership rights as EU citizens in the UK even if they themselves arrive after the exit date.

For new spouses (not existing at the Specified date) the right to reside is means tested on the sponsoring spouse

  1. no family member was  EU27 resident by the exit date then no automatic rights to Settled Status  are accrued

 

 

 

Table 2: EMPLOYED & SELF EMPLOYED (ACTIVE) UK Citizens in the EU27 (Page 1)

ITEM

 

EU

UK

STATUS OF THE INDIVIDUAL PRE EXIT / SPECIFIED DATE

EU27 RESIDENT PRE EXIT  / SPECIFIED DATE

NOT CURRENTLY EU27 RESIDENT.  ARRIVAL IN EU27 POST EXIT / SPECIFIED DATE

EU27 RESIDENT PRE EXIT SPECIFIED DATE

NOT CURRENTY EU27 RESIDENT.  ARRIVAL IN EU27 POST EXIT / SPECIFIED DATE

 

 

 

 

 

Date of effect of agreement

Date of UK exit from the EU (expected 29/03/2019)

Date of UK exit from the EU (expected 29/03/2019)

A “Specified Date” This is currently unknown but between 29/03/2017 and the date of UK exit from the EU (expected 29/03/2019)

A “Specified Date”. This is currently unknown but between 29/03/2017 and the date of UK exit from the EU (expected 29/03/2019)

Ultimate post exit authority

ECJ (CJEU) Court of Justice of the European Union

ECJ (CJEU) Court of Justice of the European Union

UK Supreme Court

UK Supreme Court

Right to acquire permanent residence / settled status?

YES. A lifetime right Including individuals who have previously resided in the EU27 or worked in the EU27 as a “Frontier Worker” but do not do so at the date of exit

NO. Unless the  individual previously resided in the EU27

  1. But continuing right dependent on remaining ordinarily resident (“Settled”) in the EU27. Assumes EU27 reciprocation of UK rules for UK citizens resident in the EU27. No objections made if EU27 rules are more generous than those of the UK
  1. Assumes EU27 reciprocation of UK rules for EU citizens resident in the UK. No objections made if EU27 rules are more generous than those of the UK

Recognition of Professional Qualifications

Protection of Cross border recognition of professional qualifications obtained within the EU28 prior to the date of entry of the withdrawal agreement.

Protection of Cross border recognition of professional qualifications obtained within the EU28 prior to the date of entry of the withdrawal agreement.

Protection of Cross border recognition of professional qualifications obtained within the EU28 prior to the date of entry of the withdrawal agreement

Protection of Cross border recognition of professional qualifications obtained within the EU28 prior to the date of entry of the withdrawal agreement

Cross Border Healthcare Rights (S1 and EHIC) as currently applied under EU regulation 883/2004

  1. in full if any cross border rights accrued pre Exit even if no longer cross border resident at date of exit. This provision is only relevant to “Frontier Workers”. The status of Posted Worker, where the employee temporarily resident and working in the EU for a UK employer and remaining subject to UK NI legislation while accessing EU healthcare, will not be maintained.
  1. available if never previously resided or worked cross border. Or at least the document makes no commitment to  match current rights accrued under Regulation 883/2004 or even provide any rights for arrivals post the exit date
  1. conditionally if resident in an EU27 state at the specified date and cross border entitlements are “ongoing”[3].  This provision is only relevant to  both “Frontier” and “Posted” Workers. Otherwise the worker will automatically be subject to the NI legislation of the EU27 state in which they are working and will access healthcare by this means. .
  1. available. Or at least the document makes no commitment to match current rights accrued under Regulation 883/2004 or even provide any rights for arrivals post the specified date.

Table 2: (Cont’d) EMPLOYED & SELF EMPLOYED (ACTIVE) UK Citizens in the EU27 (Page 2)

 

Item

EU

UK

STATUS OF THE INDIVIDUAL PRE EXIT / SPECIFIED DATE

EU27 RESIDENT PRE EXIT  / SPECIFIED DATE

NOT CURRENTLY EU27 RESIDENT.  ARRIVAL IN EU27 POST EXIT / SPECIFIED DATE

EU27 RESIDENT PRE EXIT SPECIFIED DATE

NOT CURRENTY EU27 RESIDENT.  ARRIVAL IN EU27 POST EXIT / SPECIFIED DATE

 

 

 

 

 

Cross Border State Pension Rights as currently applied under EU regulation 883/2004

Maintained in full if any cross border rights accrued pre Exit even if no longer cross border resident at date of exit

  1. available if never previously resided cross border. Or at least the document makes no commitment to  match current rights accrued under Regulation 883/2004 or even provide any rights for arrivals post the exit date
  1. Partially if resident in an EU27 state at the specified date. This includes indexation of the pension and aggregation of pre exit cross border contributory periods. This is only relevant for Non Frontier or posted Workers since it implies that any post exit date contributory period in an EU27 state will not be taken into account when calculating the UK State pension entitlement, whereas if working in the UK such working periods automatically count towards the UK state pension contributory period
  1. available. Or at least the document makes no commitment to match current rights accrued under Regulation 883/2004 or even provide any rights for arrivals post the specified date.

Treatment of Family Members (dependents and new spouses)

Maintenance of a right to reside with the qualifying family member and entitlement to the same family membership rights as EU citizens in the event that they do not qualify in their own right.

If the qualifying family member was already EU27 resident by the exit date then the family member acquires the same family membership rights as EU citizens even if they themselves arrive after the exit date.

If no family member was  EU27 resident by the exit date then no automatic rights of residence are accrued  by dependents or newly arriving spouses.

(Assuming EU reciprocity of UK proposals for EU citizens in the UK): Maintenance of a right to reside with the qualifying family member and entitlement to the same family membership rights as EU citizens in the UK in event that they do not qualify in their own right.

  1. EU reciprocity of UK proposals for EU citizens in the UK): If the qualifying family member was already EU27 resident by the exit date then if a child dependent or pre existing spouse joins the family post the Specified date, they acquire a right to “settled status” and acquire the same family membership rights as EU citizens in the UK even if they themselves arrive after the exit date.

For new spouses (not existing at the Specified date) the right to reside is means tested on the sponsoring spouse

  1. no family member was  EU27 resident by the exit date then no automatic rights to Settled Status  are accrued

 

 

[1] A Frontier Worker is a worker residing in one State but working in another where that work is subject to the National Insurance legislation of the State where they are working.

[2] See bullet point 3 of item 7 of the summary proposals in the UK document: The United Kingdom's exit from the European Union: safeguarding the position of EU citizens living in the UK and UK nationals living in the EU”.

Although the UK document itself is unclear on the matter; on our raising the query directly with them, DEXEU have confirmed to Charles Hamer that “ongoing entitlement” includes a current entitlement to a future S1 from the UK on reaching UK state pension age, by virtue of being an inactive resident of the EU 27 at the Specified Date and through to UK state pension age.

[3] See bullet point 2 above for known definition of “ongoing”

 

 

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