Information sheet for secondary advisers Permanent Residence

Information sheet for secondary advisers Permanent Residence 1. Purpose 1.1 This information note is designed for secondary advisers to EEA nationals 1 and their family members who wish to know whether they have acquired permanent residence for such purposes as obtaining permanent residence documents, naturalising as British Citizens or confirming with benefits authorities that they have a right to reside. 2. Acquiring Permanent Residence after Five Years of Residence 2.1 Under Article 16 of EU Directive 2004/38 ("the Directive"), EEA nationals automatically acquire a right of permanent residence in the UK if they have legally resided in the UK for a continuous period of five years. The Directive has been transposed into domestic law through the Immigration (European Economic Area) Regulations 2016 ("the 2016 Regulations"). 2.2 For these purposes, legal residence includes periods spent as a worker (including part time work if it is "genuine and effective" discussed further below), a selfemployed person, a student with adequate financial resources and comprehensive sickness insurance ("CSI"), a self sufficient person with CSI, or a jobseeker. An individual in one of these categories is described as a "qualified person" in Regulation 6(1) of the 2016 Regulations, and is also known as someone who is "exercising Treaty rights" set out in Article 7(1) of the Directive. 2.3 Continuous residence is not affected by periods of absence for mandatory military service or by absence from the UK for a total of no more than six months in any one calendar year. 2 One absence from the UK of up to 12 months is permitted if it is a result of an important reason such as pregnancy and childbirth, serious illness, study or vocational training or a posting abroad (see Article 16(3) of the Directive and Regulation 3(2) of the 2016 Regulations). However, once acquired, the right of permanent residence can only be lost if the individual has been absent from the UK for a consecutive period of two years. 1 2 This category covers EU nationals as well as nationals of Iceland, Liechtenstein and Norway. Swiss nationals and their family members also have the same rights as those enjoyed by EEA nationals and their families. By parity of reasoning where a person remains in the UK but is not exercising Treaty Rights, equivalent periods of time may also be discounted, see C 325/09 Secretary of State v Maria Dias at paras 61 62 and the Upper Tribunal Case IA/06986/2013. 11/44617310_2 1

2.4 The period of five continuous years can be made up of a combination of the qualifying activities which exercise Treaty rights. For example, during a five year period, the relevant person may have been first a worker, then unemployed for a few weeks, then self employed, then a student and can still potentially qualify for permanent residence. 2.5 The acquisition of the right of permanent residence is automatic, meaning that EEA nationals and their family members are not required to obtain permanent residence documents from the Home Office. However, they may do so if they wish using form EEA (PR) together with the payment of a fee (currently 65). These forms are available on the Home Office website 3. EEA nationals and their family members should consider applying for and obtaining documents proving their status in the UK as permanent residents in light of Brexit. 2.6 A family member of an EEA national 4 (regardless of that family member s own nationality) will also acquire a right of permanent residence after five years of continuous residence in the UK, as long as their EEA national family member has been exercising Treaty rights for that full five year period and/or had already acquired permanent residence. 2.6.1 The term "family member" in Article 2(2) of the Directive covers spouses, civil partners (same sex couples in a registered civil partnership) and children under 21. It is not necessary for these family members to have been living with or in contact with the EEA national family member. 2.6.2 Dependent children over 21 (including stepchildren and grandchildren) and dependent relatives in the ascending line (for example, parents, grandparents and parents in law) are also covered. Dependence need not be financial, but it must be material, meaning that it contributes to the basic necessities of life (eg, food, clothing or shelter). 2.6.3 Case law on "Dependence" includes the unnamed case of [2008] UKSSCSC CIS_2100_2007 (13 May 2008) where the Social Security commissioner summarised the case law on the meaning of "dependent". At para 44 he said: "In summary, the case law is authority for these propositions: A person is only dependent who actually receives support from another. 3 4 https://www.gov.uk/government/organisations/home office Excluding UK nationals. 11/44617310_2 2

There need be no right to that support and it is irrelevant that there are alternative sources of support available. That support must be material, although not necessarily financial, and must provide for, or contribute towards, the basic necessities of life". 2.6.4 At para 29 of the same case, the Social Security Commissioner said that material support for these purposes "could, for example, take the form of the provision of housing, clothing and food". This support does not therefore need to be financial. It could include other forms of support eg providing personal care, or supporting your parents to carry out everyday tasks. Furthermore, it can be partial support (see C 316/85 Lebon). 2.6.5 In Lim v Entry Clearance Officer, Manila [2016] Imm AR 421, the Court of Appeal held that in determining whether a family member was a "dependent direct relative" for the purposes of regulation 7(1)(c) of the Immigration (European and Economic Area) Regulations 2006, the critical question was whether he/she was in fact in a position to support themselves. In Lim, even though the mother in law received financial support from her EU national son in law, she was held not to be "dependent" as she was financially independent and did not need the additional resources for the purpose of meeting her basic needs. 3. Exercising Treaty rights 3.1 Worker 3.1.1 Regulation 4(1)(a) of the 2016 Regulations states that "worker" means a worker within the meaning of Article 45 of the Treaty on the Functioning of the European Union ("TFEU"). In accordance with Articles 7(1)(a) and 45 of the TFEU and the test laid down by the Court of Justice of the European Union ("CJEU") in C 268/99 Jany v Staatssecretaris van Justitie, it is now settled case law that, in order to be considered a worker, someone must be: (A) pursuing activities that are "genuine and effective" and not "marginal and ancillary"; (B) performing these activities in return for remuneration; and (C) working "for and under the direction of another". 3.1.2 The term "worker" must be interpreted broadly in EU law, because it defines the scope of fundamental freedom provided for by the TFEU (see eg C 66/85 Lawrie Blum v Land Baden Württemberg at paras 16 18 in 11/44617310_2 3

which 11 hours per week as a trainee teacher was considered sufficient). Additionally, the CJEU has repeatedly affirmed that the term "worker" must be given a meaning within the context of EU law and is not dependent on UK law (see C 66/85 Lawrie Blum v Land Baden Württemberg; C 53/81 Levin v Staatsecretaris van Justitie; C 39/86 Lair v Universitat Hannover). 3.1.3 Part time work is sufficient for the purposes of being a worker (C 139/85 RH Kempf v Staatssecretaris van Justitie and C 171/88 Rinner Kühn v FWW Spezial Gebaudereinigung GmbH & Co KG). The AIRE Centre advises that the UK authorities will usually require that the work is 10 hours per week or more as a minimum. However there is some case law that suggests that even fewer hours could be enough. For example, in C 14/09 Genc v Land Berlin, the CJEU found that a cleaner working 5.5 hours per week, and earning a little over 7 per hour was doing "genuine and effective" work. Whilst this case concerned a Turkish (non EEA) national, the principles should apply equally to EEA nationals because the EU law test of "genuine and effective" was applied by the court. In addition, in the UK case of SS v Slough Borough Council [2011] UKUT 128 (AAC), the benefits tribunal found that a lone parent (who was an EEA national) was a worker when earning only 65 per week, although this is probably the lower limit of what is possible. Finally, in an unreported case ((2009) UKUT 58 (AAC)), the Upper Tribunal found that a self employed person undertaking about 2 3 hours per week was doing genuine and effective work, although, again, this case was marginal. 3.1.4 A worker does not need to be working "legally'". In JA v Secretary of State for Work and Pensions [2012] UKUT 122 (AAC) at paras 19 20, the Upper Tribunal found, in the case of an EEA national who was working cash inhand for a restaurant, the fact that a contract for work is illegal as performed does not prevent the person concerned from being a "worker" under EU law. The Upper Tribunal stressed that it is the factual situation in relation to the economic relationship, not the legality of the contract, which governs. 3.1.5 The essential feature of employment is that it is a "real and genuine" relationship of providing services in exchange for remuneration with the exclusion of work that could be classified as "marginal or ancillary"; this has also been reconfirmed in C 456/02 Trojani v Centre Public d'aide Sociale de Bruxelles. 11/44617310_2 4

3.2 Self Employed 3.2.1 The free movement rights of the self employed are derived from Article 49 of the TFEU. 3.2.2 In C 268/99 Aldona Malgorzata Jany v Staatssecretaris van Justitie, the CJEU held that self employment includes pursuing "activities of an industrial or commercial character, activities of craftsmen or activities of the professions in a Member State" and also includes "the provision of services for remuneration". Self employment is in contrast to a relationship of employment because any economic activity "which a person performs outside a relationship of subordination must be classified as an activity pursued in a self employed capacity". Selfemployment has also been defined as pursuit of an economic activity through a fixed establishment without a foreseeable limit as to duration. 3.2.3 Employment and self employment are given very similar protection under EU law. It is necessary for there to be "economic activity" to count as selfemployed; and as with employment, the activity must be "genuine and effective" rather than "marginal and ancillary". Therefore, the activity must not involve so little time and money as to be largely irrelevant to the lifestyle of the EEA national. It must also not be supplementary to another activity which the EEA national spends most of their time doing. These are the same requirements as are used in determining whether an EEA national is employed. 3.2.4 There is no minimum period of time in which an individual must have been self employed. Part time work can be sufficient (see C 66/85 Lawrie Blum v Land Baden Württemberg); for example it has been held that working ten or more hours per week is enough (see, eg, C 171/88 Rinner Kühn). 3.2.5 From 1 March 2014 the government introduced the Minimum Earnings Threshold. If a self employed person is earning a "Minimum Earnings Threshold" of 155/week (2015 / 2016) they will immediately be classed as a "self employed person". This Minimum Earnings Threshold is the level of earnings needed to make Class 1 National Insurance Contributions, and is equivalent to 24 hours/week at the National Minimum Wage. 3.2.6 However work below the Minimum Earnings Threshold may also be considered. Decision makers follow a Two Tier test process: 11/44617310_2 5

(A) Tier 1 if an EEA national can demonstrate average earnings equal to or above the Minimum Earnings Threshold over a period of 3 months they will automatically have "worker" status for the purpose "means tests benefits", and they will have "retained worker status" (see further below) if they lose their employment, or become unable to work due to ill health. (B) Tier 2 if an EEA national cannot demonstrate average earnings equal to or above the Minimum Earnings Threshold over a period of 3 months, the decision maker will need to make an individual decision regarding whether the EEA national s activity was "genuine and effective". It is not possible to provide a formula for this each case is assessed on its own merit. 3.2.7 Being recognised as a self employed person will entitle the person to claim in work benefits, and out of work benefits if the person becomes unable to work through temporary ill health or incapacity, when they will be regarded as having "retained self employed status". 3.2.8 For those who are self employed, evidence of being registered selfemployed and five years of tax returns and National Insurance payments should be sufficient. Other evidence of self employment may include: advertisements for the person's business, business accounts, business bank statements, business website, invoices for work done, invoices for equipment purchased or leases on business premises (if applicable). Whether or not the person is earning the "Minimum Earnings Threshold" (as described above) will also be considered. The UK Home Office asks for various additional documents, set out in EEA (QP) or EEA (PR) forms available on the Home Office website. 3.3 Student with Adequate Financial Resources and CSI or Self Sufficient Person with CSI 3.3.1 Regulation 4(1) of the 2016 Regulations relevantly provides: "(c) 'self sufficient person' means a person who has (i) sufficient resources not to become a burden on the social assistance system of the United Kingdom during the person's period of residence; and (ii) comprehensive sickness insurance cover in the United Kingdom; (d) 'student' means a person who 11/44617310_2 6

(i) is enrolled, for the principal purpose of following a course of study (including vocational training), at a public or private establishment which is (aa) financed from public funds; or (bb) otherwise recognised by the Secretary of State as an establishment which has been accredited for the purpose of providing such courses or training within the law or administrative practice of the part of the United Kingdom in which the establishment is located; (ii) has comprehensive sickness insurance cover in the United Kingdom; and (iii) has assured the Secretary of State, by means of a declaration, or by such equivalent means as the person may choose, that the person has sufficient resources not to become a burden on the social assistance system of the United Kingdom during the person's intended period of residence." 3.3.2 The requirement to have CSI is the domestic analogue of the requirement in the Directive. Article 7(1)(c) of the Directive provides: "Right of residence for more than three months 1. All Union citizens shall have the right of residence on the territory of another Member State for a period of longer than three months if they: (b) have sufficient resources for themselves and their family members not to become a burden on the social assistance system of the host Member State during their period of residence and have comprehensive sickness insurance cover in the host Member State; or (c) are enrolled at a private or public establishment, accredited or financed by the host Member State on the basis of its legislation or administrative practice, for the principal purpose of following a course of study, including vocational training; and have comprehensive sickness insurance cover in the host Member State and assure the relevant national authority, by means of a declaration or by such equivalent means as they may choose, that they have sufficient resources for themselves and their family members not to become a 11/44617310_2 7

burden on the social assistance system of the host Member State during their period of residence; " 5 3.3.3 A person who is self sufficient or a student (including children in school), must have CSI in order to be eligible for a right of residence. The UK Home Office has interpreted the requirement for CSI in its European Operational Policy Notice 7/2011 to mean that additional cover is necessary in the form of one of: (A) Private medical insurance plan that covers you and your family for the majority of risks while in the UK. (B) European Health Insurance Card (EHIC), issued by an EEA Member State other than the UK (not applicable if coming to the UK permanently). (C) Form S1 (formerly E106, E109 and E121). (D) Form S2 (formerly E112). (E) Form S3. 3.3.4 The Court of Appeal has held in Ahmad v SSHD [2014] EWCA Civ 988 that relying on the NHS is insufficient to meet the requirement for CSI. It is however, possible to rely on reciprocal arrangements for health care between the UK and other Member States. This means that a person would have to show that they have a right to obtain healthcare in the UK and the Secretary of State can recover the costs from the person's home country. If a person is relying on any such reciprocal arrangements, the burden is on that person to provide evidence in relation to these arrangements. 3.3.5 In order to prove a right to permanent residence, it will be necessary to provide evidence of legal residence for a continuous period of five years. The EEA national will need to prove that they had CSI for any periods as a student or self sufficient person through any combination of the above forms 6 for the continuous five year period. 5 6 The Directive does not further specify how the requirement to hold CSI can be met. However, in 2009, the Commission issued a communication on better implementation of Directive (para 2.3.2 of which provides some guidance on the interpretation of CSI). However, the Home Office has refused applications for permanent residence where an EHIC is relied on as covering any of the relevant five year period. 11/44617310_2 8

3.3.6 Forms S1, S2 and S3 are expressly mentioned in the Home Office guidance notes 7 on CSI. It is thought the forms can be applied for retrospectively from the health provider in the country of origin. 3.4 Jobseeker 3.4.1 Regulation 6(1) of the 2016 Regulations defines a jobseeker as an EEA national who satisfies conditions A, B and, where relevant, C. 8 In practice, registering as a jobseeker at Jobcentre Plus will generally be sufficient to establish jobseeker status (ie satisfying Conditions A and B) provided the jobseeker meets the conditions as agreed with the Jobcentre Plus in their agreement to look for work. 3.4.2 For completeness, Conditions A, B and C provide as follows: 3.4.3 Condition A is that the person (a) entered the UK in order to seek employment; or (b) is present in the UK seeking employment, immediately after enjoying a right to reside as a qualified person (other than as a jobseeker and disregarding any period during which worker status was retained pursuant to regulation 6(2) of the 2016 Regulations): regulation 6(5) of the 2016 Regulations. 3.4.4 Condition B is that the person can provide evidence of seeking employment and having a genuine chance of being engaged: regulation 6(6) of the 2016 Regulations. 3.4.5 Condition C is that the person has had a period of absence from the UK: regulation 6(9) of the 2016 Regulations. Condition C applies where the person concerned has, previously, enjoyed a right to reside under regulation 6 of the 2016 Regulations as a result of satisfying conditions A and B, in the case of a worker or self employed person for at least six months, or in the case of a jobseeker for at least 91 days in total, unless the person concerned has, since enjoying these rights to reside, been continuously absent from the UK for at least 12 months: regulation 6(8) of the 2016 Regulations. Where condition C applies, there are further implications: see regulation 6(10) of the 2016 Regulations. 7 8 https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/588174/eea-qualifiedpersons-v4_0ext.pdf Note, Croatian nationals who come under worker authorisation cannot be considered as jobseekers. 11/44617310_2 9

4. Periods of Economic Inactivity 4.1 Some people may have to rely on periods when they (as EEA nationals) were economically inactive or when their EEA national family members were economically inactive. 4.2 However, there are also circumstances in which an EEA worker can retain their worker status (and thus still deemed to be exercising treaty rights) following short periods of economic activity. EEA nationals in the UK can retain worker or selfemployed status after ceasing to satisfy the requirements listed above. 4.2.1 Regulation 6(2) of the 2016 Regulations provides that a person retains worker status even though they are no longer working if the person: (A) is temporarily unable to work as the result of an illness or accident; (B) is duly recorded involuntary unemployment after having been employed in the UK for at least one year, provided that he (i) has registered as a jobseeker with the relevant employment office; and (ii) satisfies conditions A and B (referred to above at para 3.4); (C) is in duly recorded involuntary unemployment after having been employed in the UK for less than one year, provided that the person (i) has registered as a jobseeker with the relevant employment office; and (ii) satisfies conditions A and B (although in this case such a person may only retain worker status for a maximum of six months); (D) is involuntarily unemployed and has embarked on vocational training; or (E) has voluntarily ceased working and embarked on vocational training that is related to his previous employment. 4.2.2 Similarly a person could retain his status as a self employed person if he could show that he was temporarily unable to work because of an illness or accident (regulation 6(3) of the 2016 Regulations). 4.2.3 It is important to note that the retained worker/self employed rights above depend on a person having met the criteria for "worker"/"selfemployed person" respectively in the first place. 5. Effect of Death or Divorce on Family Members of EEA Nationals 5.1 Death 11/44617310_2 10

5.1.1 Based on Article 12(2) of the Directive, if the EEA national dies or leaves the UK, her/his non EEA family member can retain residence rights in some circumstances. 5.2 Divorce 5.2.1 Based on Article 13(2) of the Directive, if a non EEA national stops being the family member of an EEA national through divorce or the dissolution of a civil partnership, the non EEA national can retain her/his residence rights in certain circumstances: (A) if the marriage or civil partnership lasted at least three years, including at least one year in the UK; or (B) if the non EEA national has custody of the EEA national s children; or (C) there have been particularly difficult circumstances such as domestic violence; or (D) if the non EEA national has a right of access to children in the UK. 5.2.2 In those cases, after divorce the non EEA national must be self sufficient (with CSI), or be working or self employed, until completing a total of five years residence, at which point (s)he will acquire permanent residence. For cases falling under Article 13(2) of the Directive, a divorce (or termination of the civil partnership) must have taken place in order for the non EEA national to retain his/her residence rights. Additionally, the UK authorities take the view that the EEA national must have been exercising his/her Treaty rights in the UK on the date of the divorce. 6. Acquiring permanent residence before completing five years of residence 6.1 Some EEA nationals and their family members acquire permanent residence before five years have passed. 6.2 Permanent incapacity 6.2.1 Article 17(1)(b) of the Directive confers permanent residence on EEAnational workers or self employed persons who have resided continuously in the UK for more than two years and have stopped working as a result of permanent incapacity to work. If the incapacity was caused by an accident at work or an occupational disease that entitles the EEA national to claim a UK pension (eg the Industrial Injuries Disablement Benefit), the two year residence requirement does not apply. If the 11/44617310_2 11

person's spouse or civil partner is a British Citizen, they also do not have to show two years residence. 6.3 Retirement 6.3.1 Workers or self employed persons who, at the time that they stop working, have either reached State pension age or ceased paid employment to take early retirement, have worked in the UK for the preceding twelve months, and have legally resided in the UK continuously for more than three years, automatically acquire permanent residence under Article 17(1)(a) of the Directive. They do not need to have resided in the UK for three years if they are married to or in a civil partnership with a British Citizen. 6.4 Frontier workers 6.4.1 EEA nationals who, after three years of continuous employment or selfemployment in the UK, remain resident in the UK but work in another EEA State and return to the UK at least once a week, acquire the right of permanent residence in the UK under Article 17(1)(c) of the Directive. 6.5 Family members 6.5.1 Once an EEA national has acquired permanent residence through one of the Article 17 methods detailed in this section, their family members, irrespective of nationality, also acquire permanent residence in the UK. This is different from the acquisition of permanent residence under the five year rule: if someone is or becomes the family member of a person who has acquired permanent residence in one of the ways described in this section, (s)he acquires permanent residence automatically, no matter how long (s)he has been here. If an EEA national who has been exercising Treaty rights as a worker or self employed person dies before acquiring permanent residence, any family members who were residing with the EEA national acquire the right of permanent residence provided that EEA national had continuously resided in the UK for two years or the death resulted from an accident at work or an occupational disease (Article 17(4) of the Directive). 6.6 Bulgarians and Romanians 6.6.1 As of 1 January 2014 restrictions on Bulgarian and Romanian nationals' rights to work in the UK no longer apply. Bulgarian and Romanian nationals can rely on time in the UK before their countries joined the EU and when employment restrictions applied after joining. 11/44617310_2 12

6.7 Croatians 6.7.1 As Croatia joined the EU on 1 July 2013, Croatian nationals can now exercise free movement rights in the UK, in the same way as other EEA nationals who are self employed persons, self sufficient persons and students. Croatian nationals can exercise free movement rights as a worker if they obtain permission under the Accession of Croatia (Immigration and Worker Authorisation) Regulations 2013. 6.7.2 Despite Croatia joining the EU on 1 July 2013, Croatian nationals can rely on time spent in the UK before this date towards the qualifying period for a right of permanent residence. The conditions that must be fulfilled are: (i) the residence should have been in compliance with UK law and (ii) the residence should have satisfied the conditions of relevant EU law. 7. Brexit 7.1 The UK remains a full member of the EU until it has exited the EU. The UK notified the European Council of its decision to withdraw from the EU on 29 March 2017 and it has two years from this date in which to negotiate its exit from the EU (unless EU Member States unanimously agree to extend this timetable). Until the UK actually exits from the EU, all the rights and obligations afforded to EEA nationals remain in place. 7.2 The status of EEA nationals currently living in the UK following the UK's exit from the EU remains unclear. Given the uncertainty, EEA nationals can and should gather and retain evidence relating to their residence in the UK and the exercise of their Treaty Rights (eg as a worker or student). If an EEA national who is a "qualified person" has not acquired five years of continuous residence yet, that individual (and their family members) may wish to consider applying for a registration certificate or residence card in the meantime. Who to contact If you continue to have concerns or wish to seek clarification on anything contained in this information note then you can contact us at info@airecentre.org or by phone on +44 (0) 20 7831 4276 If for any reason we cannot assist then we will refer or signpost you to another organisation that will be able to help. Please note: information provided in this sheet is current up to 11 August 2017 11/44617310_2 13