About Us
FAQ
Global Law Experts Logo
Global Law Experts Logo

Find a Global Law Expert

Specialism
Country
Practice Area

Awards

Since 2010, the Global Law Experts annual awards have been celebrating excellence, innovation and performance across the legal communities from around the world.

Certificate of coverage - principle of prohibition of fraud and abuse of right

posted 6 years ago

On February
6th, the European Court of Justice ruled on the binding effect of a
certificate of coverage on a court of a Member State other
than that in which the document was issued (C-359/16).

The case
concerns a Belgian company active in the construction field, had subcontracted
the work at all its sites to Bulgarian undertakings posting workers to Belgium.
It was revealed that on the one hand the Belgian company had employed no staff
and on the other hand the Bulgarian undertakings carried out no significant
activity in Bulgaria.

The Bulgarian
authority refused to withdraw the certificates E 101 issued to the workers
posted. Relying on various breaches of the national legislation, the Belgian
authorities brought legal proceedings against the employers, servants and
agents.

The request
for preliminary ruling submitted by the Belgian Court of Cassation to the ECJ,
brings into question the possibility to annul or to disregard the E 101 certificates.

The ECJ
ruling, underlines the balance between the principle of sincere cooperation laid
down in Article 4(3) TEU and the principle of prohibition of fraud and abuse of
right expressed by the ECJ’s settled case law: the certificate of coverage
can be disregarded by a court of the Member State to which workers have been
posted.

Pending the
proposed amendments to the Regulations 883/2004 and 987/2009, the judgment
underlines the overriding value of the principle of prohibition of fraud and
abuse of right.

It must be
first noted that the question referred to the ECJ concerns the interpretation
of Article 11(1) Regulation 574/72 as applicable before its repeal by Article
96(1) Regulation 987/2009. Prima facie, the said article does not preclude a court
of another Member State from challenging the validity of a certificate E101, if
the required conditions to issue the said certificate are not fulfilled.

The ECJ’s
settled case law, and later, Regulation 987/2009 codifying the Court’s case law,
affirm the “the binding nature of the E
101 certificate and the exclusive competence of the issuing institution to
assess the validity of that certificate, and expressly retaining that procedure
as a means of resolving disputes concerning both the accuracy of documents
drawn up by the competent institution of a Member State and the determination
of the legislation applicable to the worker concerned

In that
extent, the ruling underlines Member State’s right to distinguish between
conflict of interpretation and abuse of right:

·        
If
the institutions concerned do not reach an agreement on the question whether
the required conditions to issue the certificate of coverage are fulfilled and
the Administrative Commission does not succeed in reconciling the points of
view, the said certificate cannot be annulled by a court of a Member State
other than that in which the document was issued. The Member State in which the
employee concerned actually works, may bring infringement proceedings under
Article 259 TFEU, in order to enable the Court to examine in those proceedings
the question of which legislation applies to such an employee.

·        
when an institution of a Member State to
which workers have been posted makes an application to the institution that
issued E 101 certificates for the review and withdrawal of those certificates
in the light of evidence, collected in the course of a judicial investigation,
which supports the conclusion that those certificates were fraudulently
obtained or relied on,
and the
issuing institution fails to take that evidence into consideration for the
purpose of reviewing the grounds for the issue of those certificates, a
national court may, in the context of proceedings brought against persons
suspected of having used posted workers ostensibly covered by such
certificates, disregard those certificates if, on the basis of that evidence
and with due regard to the safeguards inherent in the right to a fair trial
which must be granted to those persons, it finds the existence of such fraud
”.

 

 

Author

Find the right Legal Expert for your business

The premier guide to leading legal professionals throughout the world

Specialism
Country
Practice Area
0
LAWYERS RECOGNIZED
0 m+
EVALUATIONS OF LAWYERS BY THEIR PEERS
0
PRACTICE AREAS
0
COUNTRIES AROUND THE WORLD

Join

0
who are already getting the benefits

Sign up for the latest legal briefings and news within Global Law Experts’ community, as well as a whole host of features, editorial and conference updates direct to your email inbox.

Naturally you can unsubscribe at any time.

Newsletter Sign Up

About Us

Global Law Experts is dedicated to providing exceptional legal services to clients around the world. With a vast network of highly skilled and experienced lawyers, we are committed to delivering innovative and tailored solutions to meet the diverse needs of our clients in various jurisdictions.

Contact Us

Stay Informed

Join Mailing List

GLE