Wednesday, 27 July 2016

Free movement of persons in the European Economic Area (EEA) – different from the EU?

Karin Fløistad: PhD Candidate, European University Institute; practicing lawyer at Norwegian law firm Simonsen Vogt Wiig

Free movement of persons continues to be debated in the UK after the Brexit referendum and the EEA Agreement is often referred to regarding the UK's future relationship with the EU.  This post intends to address two differences in the right to free movement of persons in a model of association with the EU outside membership – the EEA Agreement compared to the right to free movement of persons in the EU.

The EEA Agreement extends the EU internal market to include three of the parties to the European Free Trade Association (EFTA) – Norway, Iceland and Liechtenstein – but without membership in the Union. The extension of the internal market means, in principle, parallel rights and obligations in the area of free movement (including the right to free movement of persons) and competition law. Nevertheless, certain products (fish and agricultural products, see Article 8(3) EEA) and tax harmonisation are outside the scope of the Agreement. 

However, there are two differences between being subjected to the right of free movement of persons as a Member State of the EU compared to that of being a Contracting Party to the EEA Agreement. The first is the lack of Union citizenship in the EEA. The second is that immigration from other non-EU countries is outside the scope of the Agreement. Hence, free movement of persons is clearly different in the EEA compared to the EU – although the EFTA States have signed up to be part of the EU’s non-EU immigration rules (the Schengen open borders rules and the Dublin rules on asylum responsibility) separately. As will be demonstrated institutional practice (in particular the EFTA Court's case law regarding citizens' right to free movement) has nevertheless made the implications of these differences in the legal framework unclear.  

In legal terms, the two differences are expressed first, through the fact that there are no corresponding provisions to the relevant EU primary law; hence Articles 20-25 TFEU regarding the creation of the concept of Union citizenship and Article 79 TFEU on rights of non-EU citizens are not paralleled in the EEA Agreement. Second, there are parallel differences in secondary legislation: EU laws on non-EU citizens such as Directive 2003/86/EC on the right of family reunification and Directive 2003/109/EC on rights of long term residents have not been made part of the annexes of the EEA Agreement.  Furthermore, the two differences were recently emphasised by the Contracting Parties in a Joint Declaration, which was adopted when the EU’s citizens’ Directive (the main secondary legislation regarding the right to free movement of citizens) was made part of EEA law (Decision by the EEA Joint Committee No 158/2007).

That Decision enshrined the citizens' Directive as part of the EEA Agreement through an amendment of Annexes V and VIII to that agreement, with the usual adaptations such as substituting the words 'Union citizen(s)' with the words 'national(s) of EC Member States and EFTA states. The citizens' Directive entered into force in the EEA on 1 March 2009 and has been the subject of four EFTA Court cases; E-4/11 Clauder (Liechtenstein), E-15/12 Wahl (Iceland), E-26/13 Gunnarsson (Iceland) and finally the recent case of E-28/15 Jabbi (Norway).   

Since the late 1990s the CJEU has applied the status of Union citizenship to create rights in the field of extending territorially bound social security rights, to ensure patient's rights to have treatment abroad paid for by domestic welfare systems, to ensure the export of student financing as well as ensuring rights for non-EU citizens as family members of Union citizens. All this case law has been inspired by or legally based on the fundamental status of Union citizenship. Hence, the construction of Union citizenship has contributed to EU law, including EU institutional practice, having an impact on national domestic systems of welfare and immigration. Union citizenship is part of increasing and deepening the EU integration process. Free movement rights for individuals detached from market objectives substantiate Union building. Citizens should ideally move freely, and therefore, states have obligations not to create barriers to movement. 

No parallel objective exists in the economic and market oriented scope of the EEA Agreement. The EEA Agreement is, however, a complex legal construction where the principles of dynamism and homogeneity with EU law have been afforded significant weight in the institutional practice (see for a recent reference to the substantial weight of the homogeneity objective in paragraph 60 of Jabbi). Hence, the EU/EFTA institutions applying EEA law have significantly paralleled the aforementioned developments in the EU legal order and included parallel rights for individuals with corresponding obligations on states into the EEA legal order (despite the lack of parallel provisions on EU citizenship); social security rights for the non-economically active movers (see Cases E-5/06 ESA v Liechtenstein, E-4/07 Porkelsson, E-3/12 Jonsson, E-6/12 export of child care benefits, E-26/13 Gunnarsson and C-431/11 UK v Council), free movement rights for patients (see Joined Cases E-11/07 and 1/08 Slinning and Rindal), export of student benefits (see EFTA Surveillance Authority Cases No 69199 and No 71579), rights for family members of non-economically active EEA citizens (see Case E-4/11 Clauder and EFTA Surveillance Authority Case No 73930 (pending)).

The EU/EFTA institutional practice on the right to free movement of persons in the EEA Agreement has reached its possible peak with the case of E-28/15 Jabbi. The question in the case was at the core of evolving EEA law – a possible right to family reunification with a non-EU citizen for a non-economically active EFTA state national who had availed herself of free movement rights and who was in receipt of welfare benefits. The EFTA Court's advisory opinion recognised that there are differences in the legal framework between the free movement of persons in the EEA compared to the EU, especially as regards EU citizenship (see paragraph 66 in particular). The Court refers to a gap due to the revised primary law of the EU in the Maastricht, Amsterdam, Nice and Lisbon Treaties with no corresponding changes in the main part of the EEA Agreement. The Court also recognised the differences by making it explicit that it has to rely on the legal sources available as part of EEA law (and consequently that the EFTA Court cannot rely on the same legal basis as the CJEU did in a similar case decided in 2014 (discussed here), given that Union citizenship has not been made part of EEA law) (see paragraphs 68 referring to an 'authority included in the EEA Agreement' and 71 referring to the citizens’ Directive being ruled out by the CJEU in the current situation).

The principal question in the case (answered by the EFTA Court in the affirmative) was whether a non-economically active EEA citizen seeking family reunification with a TCN national has rights based on EEA law when returning to his or her country of origin. In other words, the question was whether the situation is governed exclusively by national domestic law or whether rights may also be derived from EEA law.

The question of scope was challenging in the EEA context given the limitation of the citizens' Directive: it only applies to EEA citizens who have moved to a host state (with the exception of Chapter 2 regarding particular situations of exit visa etc, which were of no relevance to the case). The Jabbi case concerns instead the situation of rights against the home state, after having moved to another EEA state, and then returned. Rights against the home state for a non-economically active Union citizen falls within the scope of EU law through the concept of Union citizenship as enshrined in the primary EU law articles which are not paralleled in the EEA. Through the advisory opinion in Jabbi the EFTA Court took yet another step to ensure parallel rights to free movement of persons in the EEA as compared to the EU, transposing to the EEA legal order the relevant case law of the CJEU (discussed here), despite those differences in the EU and EEA legal frameworks.

However, the Union citizenship case law of the CJEU includes situations where no similar authority exists in the EEA such as the Ruiz Zambrano case law (see case C-34/09), where rights accrue to EU citizens solely by virtue of their EU citizenship, rather than because of movement between EEA members. In addition, the Union citizenship case law includes elements of mutual financial solidarity legitimating EU law having an impact on national welfare systems, see cases on students' rights against their home state in cases like C-359/13 Martens, C-220/12 Thiele and C-585/11 Prinz and Seeberger (discussed here). This aspect of mutual solidarity was also part of the reasoning in the early case law establishing Union citizenship as a fundamental status; see i.a. cases like C-184/99 Grzelczyk and C-209/03 Bidar regarding students' right to welfare benefits in the host state. Decisional practice from the EFTA Surveillance Authority indicates parallel rights for students in the EEA. A similar understanding might be hinted at from the EFTA Court in Jabbi in paragraph 51. However, what is striking in Jabbi is a renewed attention by the EFTA Court to limit the impact of its decision regarding national welfare systems and to be explicit about differences in the two legal orders.

In paragraphs 78 and 82 of the Advisory opinion the EFTA Court refers to the citizens' Directive Article 7(1)(b) to apply by analogy to the situation of a returning own national. The Court makes this reference stating that a derived right depends on the conditions in this Article to be fulfilled (in addition to other conditions familiar from CJEU Union citizenship case law regarding 'genuine stay' and length of stay for the Union citizen to find him/herself in a cross-border situation). One possible interpretation of the statements made by the EFTA Court in these paragraphs is the possibility to maintain national requirements for family reunification in terms of financial means available for the sponsor. This understanding of the opinion is based on the Court repeated references to family reunification in the home state to be conditioned upon the requirements in Article 7(1)(b) to be fulfilled also in the home state upon return (see paragraphs 80 and 82).  
Given this interpretation of the advisory opinion the extent to which the rights of Mr Jabbi to fall within the scope of EEA law to actually be of any concrete assistance is questionable. The right to family reunification for Mr Jabbi is ultimately conditioned on the sponsor fulfilling the criteria of sufficient means and medical insurance as enshrined in Article 7(1)(b) of the Citizens Directive meant to ensure that no unreasonable burden is placed on the national welfare systems. In this, the EFTA Court seems to have respected national conditions in Norwegian domestic immigration law where family reunification is conditioned on certain requirements regarding sufficient means. Another consequence of this reading of the advisory opinion is the extent to which both static citizens and returning non-economically active citizens would be treated alike in domestic legislation. 

The Union citizenship case law of the CJEU has always been directed towards efficient rights for the Union citizen and aiming at eliminating differences between the economically active and the non-economically active. Having said  this more generally the recent restrictive case law from the CJEU on host state obligations based on Union citizenship in cases like C-333/13 Dano, C-67/14 Alimanovic and the recent case on restricting the export of child care benefits from the UK, C-308/14 should also be mentioned. It may be argued that the EFTA Court's opinion in Jabbi is in line with this recent case law when the EFTA Court demonstrates deference to its decisions having an impact on domestic welfare systems. The spirit of Union citizenship case law and in particular the home state obligations enshrined in the recent CJEU case law on students' rights is, however, not apparent in the Jabbi case. On the contrary the EFTA Court seems more reluctant and albeit focusing on the aim of homogeneity to also for the first time pointing at possible differences occurring between the two legal orders due to differences in the legal framework. 
The institutional practice of EEA law from EU/EFTA institutions seems to consistently aim at paralleling free movement rights for persons in the EEA as compared to the EU. The general point to make here is nevertheless that the provisions on free movement rights for persons in the EEA Agreement are substantively different to their EU counterparts. This difference was pointed to in the Wahl case (paragraph 75) but the Jabbi case is the first time this difference is elaborated on by the EFTA Court (in particular paragraph 62).  In the EEA, the free movement of persons include the free movement rights for the economically active to facilitate the economic aim of the internal market. However, outside the economically active, rights are limited and there is neither the status of Union citizenship nor the overarching aim of an 'ever closer Union'. The rights of non-EU citizens are in principle outside the scope of the Agreement. Furthermore, institutional practice in the EEA is subject to the decisions made by the Contracting Parties in the political organ of the EEA Joint Committee. Free movement rights for persons are not the same in the EEA compared to in the EU. Whether they are sufficiently different to be of interest to the UK and the EU for future association remains to be seen.   

Barnard & Peers: chapter 13, chapter 25
JHA4: chapter I:6

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1 comment:

  1. Where EU Citizens move to EEA/EFTA-states, their movement rights follow from the EEA Agreement. It will be interesting to see wheter the CJEU will adhere to the EFTA Court's interpretation of Directive 2004/38/EC where an economically inactive EU Citizen marries a 3rd country National in Iceland, Liechtenstein or Norway, and then returns to his or her home state. As homogeneity within the EEA also requires equal interpretation and application of EEA Law in the EFTA pilar and the EU pilar, The CJEU will, if homogeneity is to be achieved, have to rule that directive 2004/38/EC, where applied in an EEA setting, "by analogy" gives rights towards the home state the directive does not give when applied in an EU setting.