All of life is changed: The impact of Brexit on UK nationals living in other EU Member States

Sarah McCloskey and Tamara Hervey, Sheffield Law School

After a series of cataclysmic political events, most people can empathise with the stress and anxiety born out of the subsequent uncertainty. At this time, the people who are enduring the greatest burden are those who have enjoyed a right to free movement exercised in good faith without concern that it might be taken away. Such is Brexit: the source of frustration, a nuisance of the daily news to many, but for EU citizens in the UK and UK nationals living in other Member States, it holds the potential to fundamentally change their very way of life. Without for a moment disregarding the (moral and economic) significance of the former group, we focus here on the latter.

What do the UK government’s proposals mean for UK nationals in the EU-27? What does it mean for their “right to remain, healthcare arrangements under the EU social security agreements, and pension entitlements and payments”? As Strumia highlights, the UK’s offer focuses on EU citizens in the UK. But in a negotiation, the offers made on one side have implications for those on the other. We seek to deduce from the UK’s negotiating position what it might mean for UK nationals in the EU-27.

UK’s Negotiating Position

Despite the hopes for "a magnanimous gesture on the part of the Prime Minister,” the UK government has maintained its stance that a unilateral offer to EU-27 nationals resident in the UK on ‘Brexit Day’ would compromise its negotiating position. Thus, its proposal is founded on the condition of reciprocity. Of course, we remain uncertain as to the outcome of the negotiations. Nevertheless, we can consider the extent to which the UK’s position is a “fair and serious” offer (as the UK government has portrayed) by comparison with the EU’s prior counterpart proposal.

According to the UK negotiating position, upon the UK's exit from the EU, EU citizens in the UK will be required to apply for a new residence status within a grace period of two years. Despite promises of a “streamlined” procedure with incurred fees set at a “reasonable level”, the proposal has faced criticism for subjecting even those who have already obtained a certificate of permanent residence to this new application process. Reciprocity on these terms would dictate that UK nationals in the EU-27 must therefore expect analogous treatment under their post-Brexit status of “third country nationals” (TCNs). They would need to apply for a new residence status under the immigration law of the EU Member State in which they reside. And again, if reciprocity applies, while those who arrive before the yet-to-be-specified date will be granted a temporary status that allows them the opportunity to accrue the vital 5 years of residence, those who arrive at any time thereafter will have no such protection or special treatment. Instead, they would be subject to ordinary immigration law.

Further, any disputes would have to be settled through national courts in the EU-27 country, without any recourse to a supranational authority (such as the CJEU) for a definitive settlement. It would be significantly more difficult to enforce residence and other rights than it is at present.

Under the UK negotiating position, those EU nationals who are successful will be granted what is referred to as "settled status" in UK law pursuant to the Immigration Act 1971. This is subject to certain criteria, including that the applicant must have been resident in the UK before an (as yet un-) specified date (that will fall between 29 March 2017, when the Article 50 letter was sent, and Brexit Day) and have completed a period of 5 years’ continuous residence. It is worth noting here that the UK government has not outlined its definition of “continuous residence” and, given the Prime Minister’s hostility towards the CJEU, it cannot be presumed that it mirrors that accepted in EU law.

Again, if applied reciprocally, UK nationals currently resident in the EU-27 (as EU-27 nationals currently resident in the UK) would be potentially precluded from relying on the benefits of free movement to visit family or for work-related events, for example, in case such visits interrupt their period of continuous residence for longer than permitted under the relevant law. Further, as Strumia notes, this means that the UK’s present protection of free movement is meaningless for EU citizens living in the UK, as any such exercise could be to the detriment of their post-Brexit application.  Like so many other issues, the devil is in the detail and thus, it remains to be seen just how “smooth and simple” acquiring these new rights will be.

Turning to the more specific issues of pensions, child benefits, education, and healthcare, the UK’s negotiating position offers a little more information. On pensions, the UK’s position is explicit that ‘the UK will continue to export and uprate the UK State Pension within the EU’. Given that 21% of UK nationals in EU-27 countries are over the age of 65, this is a significant commitment. Likewise, the current position on child benefit continues: individuals resident before Brexit Day will be able to export any child benefit to which they are entitled in their country of residence, which is of great importance for divorced and separated families. On education, the right of UK students to remain in the respective EU-27 country applies up until course completion (and not beyond) and those with residence rights have the same access to tuition fees and any maintenance grants as nationals of the host country.

Healthcare, however, poses more complexities. The UK government has proposed a new arrangement ‘akin to the EHIC scheme’ (i.e. the European Health Insurance Card, which currently entitles those covered by their home health care system like the NHS to medical treatment in another EU country).  There are non-EU states incorporated within the EHIC scheme, so in theory the UK could join post-Brexit. But in practice, free movement rights will have to be included. Otherwise, the technical and administrative logistics, outside of the current arrangements for coordination of social security, may prove insuperable. The EU coordination of social security is a rules-based system: it is not a matter of politically negotiated bespoke arrangements. A reciprocal deal (to be part of the rules-based system) may be feasible. Access to health care outside such a system (without free movement, without the possibility of CJEU oversight) is unlikely to be so. If that is so, in principle a reciprocal deal would leave UK nationals resident in the EU to fall back on national law to determine their health care entitlements.

The UK’s negotiating position does not explicitly address a host of other practicalities for UK nationals resident in the EU-27 (and vice versa): equal access to housing; equal tax benefits; entitlement to move to and reside in other EU Member States; and equal entitlements to union membership. This is far from offering the claimed reassurance in the face of uncertainty.

In the absence of such details, the only guiding light is: "After we leave the EU, the UK will no longer be subject to EU law. Free movement rights will come to an end and therefore cannot be carried forward, as an EU legal right, into the post-exit UK legal regime.”

If this is the default, and reciprocity is the basis for future entitlements, the effects for UK nationals in the EU-27 would be to face the same prospect of rights reduction as their EU citizen counterparts in the UK.

Applicable EU law

However, this analysis on the basis of reciprocity ignores the fact that the EU itself already has rules concerning the treatment of non-EU TCNs resident in its Member States. The UK’s rejection of an ‘acquired rights’ approach or, indeed, a bespoke proposal of any kind marks an intention to simply align the status of EU nationals with UK immigration law, with all the procedural and substantive implications that entails. But that approach is not available to the EU-25 (Ireland and Denmark have opted out of this law), who are bound by EU law on non-EU migrants, in particular by the EU’s Long-Term Residence (LTR) Directive. The LTR Directive brings the position of UK nationals resident in the EU-25 within EU law as it provides legal protection to some TCNs. This is a Directive that can be - and has been - enforced before national courts, and is subject to the jurisdiction of the CJEU. (There is also some EU legislation on the position of non-EU citizens who don’t yet qualify for LTR status).

Articles 7 and 8 of the LTR Directive govern the scheme by which long-term resident status is acquired and the residence permit granted. The LTR Directive holds the process to a certain standard, imposes common criteria, requires the grant of LTR status where conditions are satisfied (Article 7 (3), Iida para 39), and guarantees certain rights where applications are successful. Article 7(2), for example, requires applications to be processed within 6 months, and Article 10 states that reasons must be given for decisions.

Subject to certain conditions (outlined below), the Directive confers equal treatment of TCNs to nationals in the host country in numerous areas. These include: access to employment; self-employment; recognition of qualifications; tax benefits; and pensions. The UK’s negotiating position, inasmuch as it fails to offer these matters on a reciprocal basis, appears to assume that this aspect of EU law does not exist.

The entitlements under the LTR Directive (and possibly parallel national laws on long-term residence) are extensive. Assuming that it would be the applicable law if the UK’s proposals were to succeed, or indeed if the UK were to leave the EU without successfully negotiating a withdrawal agreement, this raises a question. The position of UK nationals in the EU-27 would obviously be better if the EU proposal prevailed (particularly for those who do not have long-term residence yet). But how much worse off would UK nationals in the EU-25 be under the UK proposals as compared to the EU’s offer? (The position of UK nationals in Ireland will presumably be a special case because of the common travel area; UK nationals in Denmark would have to rely on Danish law.)

Comparison of EU Proposal and EU Law Position: Long-Term Residence Directive

The EU proposal seeks to maintain the current status of EU citizens in the UK and UK nationals in the EU-27, but without the framework of EU citizenship which is conditional on membership of the EU. By comparison, the LTR Directive has been described as creating a “subsidiary form of EU citizenship”.

The LTR Directive offers TCNs a wide range of rights equal to that of nationals in their host country. It removes Member States’ direct control by outlining that where conditions are met and where there is no Article 6 exception (for public policy or public security), long-term resident status must be granted (Article 7(3)). Ordinary immigration law is not subject to those kinds of external oversights or constraints. However, LTR status remains far from parity with EU citizenship status and, in turn, the EU’s proposal. The material rights are less, the scope is more restrictive, and the acquisition process more arduous.

Equal treatment in respect of social assistance and social protection can be confined to core benefits (Article 11(4)), as defined in the ECJ ruling in Kamberaj. Retention of restrictions to access to employment or self-employed activities where these activities are lawfully reserved to nationals, EU or EEA citizens is also permitted (Article 11(3)(a)). Further, acquiring LTR status does not confer the free movement rights within the EU that its citizens are accustomed to; Article 14 outlines the conditions which must be met to acquire the right to reside in a second Member State for a period exceeding three months. The right to family reunification represents another stark contrast: for TCNs, the highly restrictive Directive 2003/86/EC applies, while the EU proposal guarantees that the Withdrawal Agreement would apply to family members, ‘regardless of their nationality, as covered by Directive 2004/38’. This covers both current and future family members.

Turning to scope, the EU proposal is unequivocal: it captures all 'UK nationals who reside or have resided in EU27 at the date of entry into force of the Withdrawal Agreement', UK nationals who work or have done so in EU27 at that date whilst residing in the UK or another EU27, UK nationals covered by Regulation 883/2004, and (in all cases) their family members. Conversely, Article 3(2) of the LTR Directive outlines numerous exclusions, including TCNs resident due to pursuit of studies or vocational training, seasonal workers, and cross-border service providers.

Further, in exchange for this more limited status, there are a greater number of conditions to satisfy. Beyond its mutual basis with the EU proposal’s requisite 5 years continuous legal residence, the LTR Directive also sets out that TCNs need to: provide evidence that they possess sufficient stable and regular resource to maintain themselves and their family members without recourse to the host Member State's social assistance system; have adequate sickness insurance; and, in some cases, demonstrate compliance with integration conditions imposed by national law. Necessarily, implementation of the UK proposal would therefore subject UK nationals in the EU-27 to a much more demanding application process with likely lower success rates than the more black-and-white EU proposal.

Undoubtedly then, the EU proposal is far more favourable to that offered by the UK. This is not unexpected; while the EU recognises the valuable contribution made by TCNs to the Member States in which they reside, inevitably a proposition vested in the interests of the 3.15 million EU citizens in the UK will comprise a better deal than the residual LTR Directive position. And, for negotiating purposes, offering identical conditions for UK nationals in the EU-27 was necessary.

Nonetheless, were the UK proposal to prevail, its nationals are still afforded better protection than their EU citizen counterparts in the UK. The LTR Directive and Article 7(3) in particular represent a safety net to which the EU-25 are held to account. There is no such equivalent for EU citizens in the UK who, post-Brexit, would be entirely at the mercy of ordinary immigration law were the UK’s position adopted.

Non-reciprocity

There is an undeniable gap between the EU negotiating position and the LTR Directive. However, it is to some extent quantifiable. In contrast, the extent of the chasm between the current position of EU nationals in the UK and the UK’s proposal for their post-Brexit future is not yet known. Moreover, the UK’s silence on numerous existing rights does not bode well. While the comparable certainty of the LTR Directive is enough to be relatively reassuring to UK nationals, those who do not yet qualify for the status will be subject only to national immigration law and thus face the same level of uncertainty as EU citizens in the UK.

It might seem surprising that the UK’s response to the EU proposal is so weak. But perhaps this is somewhat accounted for by the difference in numbers: in comparison to the 3.15 million EU citizens in the UK, there are an estimated 900,000 UK nationals in the EU-27. Most of them do not vote in UK general elections. Perhaps they are the ‘sacrificial lambs’ of these negotiations. But this fails to account for the 60% of UK nationals who want to keep their EU citizenship. (Notably, this number increases by 20% for the up and coming political force that are the 18-24 year olds.) If these polls are to be believed, the UK government has a greater investment in a good deal than their proposals implied they thought to be the case. Lest it further alienate the electorate, the UK government should reconsider the EU’s position, taking into account applicable EU law, and provide an injection of reality into its negotiating stance.

Barnard & Peers: chapter 27

Photo credit: Irish Times