The Program Law of 27 December 2006 obliges posted self-employed workers to give prior notification regarding their partial or temporary activity in Belgium. Failure to comply with this obligation may lead to criminal and/or administrative sanctions for both the self-employed worker and his/her Belgian client.
This Belgian notification requirement has been scrutinised by the European Court of Justice (hereafter referred to as the ‘ECJ’) and was considered to be incompatible with EU internal market law.
The ECJ’s judgment
The ECJ decided that the Belgian Limosa legislation for posted self-employed workers infringes the EU fundamental freedom to provide services within the EU. According to the Belgian Limosa legislation, a posted self-employed worker or his/her authorised representative must give electronic notice of his/her activity in Belgium to the National Institute for the Social Security of the Self-employed (RSZV/INASTI). The notification requirement, to be fulfilled before performing the professional activity in Belgium, includes the obligation to provide the Belgian authorities with very detailed information.
In its judgment, the ECJ made it clear that it supports the underlying aims of combating fraud, in particular social security fraud, as well as preventing abuse, such as false self-employment and undeclared work. However, the obligations concerned go further than what is strictly necessary for attaining this objective. The foreign self-employed worker must provide a lot of detailed information and the Belgian government failed to prove that all this information is actually necessary to fulfil the notification requirement’s aims. Therefore, the concerned Belgian legislation is deemed disproportionate and thus incompatible with EU law.
Implications
Currently, it is hard to determine what the consequences of this European judgment will be. It remains to be seen whether the Limosa legislation for foreign self-employed workers will be completely abolished or whether the legislation will be adapted to stretch the rules. Based on the wording of the judgment, a revision will be the most likely way forward.
The Limosa judgment may have consequences for posted employees as well. Even though the ECJ’s scrutiny was aimed at the requirements for posted self-employed workers, there might also be a need to re-evaluate the existing rules for posted employees. If this reassessment does not take place, it is not unlikely that the Belgian government would risk a ‘Limosa II’ judgment.
