"Self-secondment in France" of artists from the European union
Tuesday, 17 August 2004
European Court of Justice (Section Five), 30 March 2000, Bank and others against Théâtre Royal de la Monnaie and others
Are entertainment promoters based in France who hire artists residing in the European Union - artists who have self-employed status in their country - required to pay social security contributions in France?
The action that prompted this ruling of the European Court of Justice (ECJ) was brought by several British artists against a Belgian theatre that had engaged them on several occasions between 1992 and 1995 for periods of less than three to four months each time.
The artists were resident in the United Kingdom, where they were in normal gainful employment and duly registered in the British social security system (National Insurance) as self-employed workers. They had all produced an E101 certificate proving they were subject to British social security legislation and had self-employed status.
Further to instructions from the Belgian authorities, the theatre had considered them as salaried workers and had thus deducted Belgian social security contributions from their fees. Contesting their liability for Belgian welfare contributions, the artists asked the Belgian employment tribunal to order the reimbursement of the contributions paid by the theatre.
Before giving its ruling, the Belgian tribunal sought the opinion of the ECJ as to how to interpret community regulation 1408/71 on the applicability of social security systems to salaried and self-employed workers working in several countries in the Community.
The ECJ’s ruling is particularly apposite to France, because French legislation on entertainment artists is similar to Belgian legislation.
Article 14a, point 1a of regulation 1408/71 states that "A person normally self-employed in the territory of a Member State and who performs work in the territory of another Member State shall continue to be subject to the legislation of the first Member State, provided that the anticipated duration of the work does not exceed 12 months". That being the case, no contributions are therefore payable under the social security scheme of the state in which the work is done.
The ECJ was asked to give its opinion on how the term work should be interpreted.
In the French government’s view, the term only refers to self-employed activities as defined by French legislation: if the work performed on French territory is salaried (as defined by French legislation), it must be liable for payment of French social security contributions. The ministry of employment had indeed specified this interpretation for self-employed artists in European union countries who are hired in France1: due to the presumption of salaried status2, services performed in France must be considered as salaried activities that are thus liable for payment of French social security contributions.
On the contrary, in giving this decision, the ECJ upholds that the term work refers to any type of work, whether or not it is salaried.
The ECJ thus admits that an entertainment worker subject to the self-employed scheme in a member state who is hired in another member state for a period not exceeding 12 months should not be registered in the social security system of the latter, whether or not the ‘work’ is deemed salaried (subject to providing an E101 form).
It should be borne in mind that the applicability of article 14a point 1a to artists is vouched for by a form common to all European union countries, known as “E101 certificate”. In this respect, the ECJ states that "as long as it is not withdrawn or declared invalid, certificate E101 [...] remains binding on the competent institution of the member state the self-employed worker works in, as well as on the person calling on the services of the worker".
In a circular dated 18 January 2001 and sent to the national health insurance agency for salaried employees, the central agency of social security organizations, the social security centre for migrant workers and the regional branches of the health and social affairs department, the ministry clearly draws conclusions from the Barry Banks ruling by repealing its previous circulars.
It states that henceforth entertainment workers, models and other workers regarded as self-employed by the legislation of the member state in which they ordinarily work should be exempted from French social security contributions, provided they are in possession of form E101.
Therefore, when an artist supplies an E101 form, there is no longer any need to distinguish between its being issued under article 14.1.a (artist registered as a salaried worker and seconded by an employer based in a European union country) or under article 14 bis 1a (artist registered as self-employed). In either case, social security, unemployment benefit and private pension contributions are not owed in France.
See also : Foreign artist hired by a company based in France and Presumption of salaried status: exclusion of european artists working on a temporary and freelance basis
1 Ministerial letter dated 22 April 1997
2 Any contract under which a private individual or business procures the services of an entertainment artist in the production of a show, in return for payment, is presumed to be a work contract if the artist does not perform the contract work in conditions requiring him to be registered in the Trade & Companies register.
Last Updated ( Tuesday, 02 June 2009 )
The artists were resident in the United Kingdom, where they were in normal gainful employment and duly registered in the British social security system (National Insurance) as self-employed workers. They had all produced an E101 certificate proving they were subject to British social security legislation and had self-employed status.
Further to instructions from the Belgian authorities, the theatre had considered them as salaried workers and had thus deducted Belgian social security contributions from their fees. Contesting their liability for Belgian welfare contributions, the artists asked the Belgian employment tribunal to order the reimbursement of the contributions paid by the theatre.
Before giving its ruling, the Belgian tribunal sought the opinion of the ECJ as to how to interpret community regulation 1408/71 on the applicability of social security systems to salaried and self-employed workers working in several countries in the Community.
The ECJ’s ruling is particularly apposite to France, because French legislation on entertainment artists is similar to Belgian legislation.
Article 14a, point 1a of regulation 1408/71 states that "A person normally self-employed in the territory of a Member State and who performs work in the territory of another Member State shall continue to be subject to the legislation of the first Member State, provided that the anticipated duration of the work does not exceed 12 months". That being the case, no contributions are therefore payable under the social security scheme of the state in which the work is done.
The ECJ was asked to give its opinion on how the term work should be interpreted.
In the French government’s view, the term only refers to self-employed activities as defined by French legislation: if the work performed on French territory is salaried (as defined by French legislation), it must be liable for payment of French social security contributions. The ministry of employment had indeed specified this interpretation for self-employed artists in European union countries who are hired in France1: due to the presumption of salaried status2, services performed in France must be considered as salaried activities that are thus liable for payment of French social security contributions.
On the contrary, in giving this decision, the ECJ upholds that the term work refers to any type of work, whether or not it is salaried.
The ECJ thus admits that an entertainment worker subject to the self-employed scheme in a member state who is hired in another member state for a period not exceeding 12 months should not be registered in the social security system of the latter, whether or not the ‘work’ is deemed salaried (subject to providing an E101 form).
It should be borne in mind that the applicability of article 14a point 1a to artists is vouched for by a form common to all European union countries, known as “E101 certificate”. In this respect, the ECJ states that "as long as it is not withdrawn or declared invalid, certificate E101 [...] remains binding on the competent institution of the member state the self-employed worker works in, as well as on the person calling on the services of the worker".
In a circular dated 18 January 2001 and sent to the national health insurance agency for salaried employees, the central agency of social security organizations, the social security centre for migrant workers and the regional branches of the health and social affairs department, the ministry clearly draws conclusions from the Barry Banks ruling by repealing its previous circulars.
It states that henceforth entertainment workers, models and other workers regarded as self-employed by the legislation of the member state in which they ordinarily work should be exempted from French social security contributions, provided they are in possession of form E101.
Therefore, when an artist supplies an E101 form, there is no longer any need to distinguish between its being issued under article 14.1.a (artist registered as a salaried worker and seconded by an employer based in a European union country) or under article 14 bis 1a (artist registered as self-employed). In either case, social security, unemployment benefit and private pension contributions are not owed in France.
See also : Foreign artist hired by a company based in France and Presumption of salaried status: exclusion of european artists working on a temporary and freelance basis
1 Ministerial letter dated 22 April 1997
2 Any contract under which a private individual or business procures the services of an entertainment artist in the production of a show, in return for payment, is presumed to be a work contract if the artist does not perform the contract work in conditions requiring him to be registered in the Trade & Companies register.
