Dr Sylvia de Mars, Newcastle University*

* With many thanks to Prof Charlotte O’Brien for all the idea-swapping that preceded this blog post.

Background

A key question regarding EU nationals’ rights to reside in the UK from at least 2011 onwards has been whether the NHS constitutes ‘comprehensive sickness insurance’ (CSI). This requirement stemmed from Article 7(1)(b) of Directive 2004/38 (the ‘Citizenship Directive’), which stipulated that economically inactive EU citizens could only reside beyond three months in another Member State if they wouldn’t burden the host country’s social assistance system and possessed CSI. A similar rule applied to students under Article 7(1)(c).

However, the term “comprehensive sickness insurance” wasn’t clearly defined, leading to national courts interpreting it. The UK’s position was that NHS access didn’t constitute CSI, as articulated in case law and Home Office policy. This stance created a significant hurdle for EU nationals seeking residency, as private insurance options were often insufficient or inaccessible. While EU nationals didn’t typically require proof of residency, it became crucial when sponsoring non-EU family members or applying for UK citizenship. This policy drew criticism from immigration lawyers who argued it contradicted the Directive’s intent. Despite complaints and potential infringement proceedings from the European Commission, the issue remained unresolved, likely due to political sensitivities surrounding immigration and the UK’s eventual decision to leave the EU.

Fast-Forward to 2022: VI v HMRC

In 2022, the Court of Justice of the European Union (CJEU) finally addressed the question of how the NHS should be categorized in the context of EU law, although not directly related to the CSI issue. The case, VI v HMRC, involved a Pakistani national residing in Northern Ireland with her family, including a son with Irish nationality. The dispute centered around VI’s eligibility for Child Tax Credit and Child Benefit during periods when she lacked private CSI but had access to the NHS.

Before addressing the referred questions, the CJEU established its jurisdiction based on the Withdrawal Agreement’s provisions, asserting its authority to rule on cases initiated before the transition period’s end.

The CJEU tackled three questions. First, it determined that permanently resident children, like VI’s son, weren’t subject to the CSI requirement, as per Article 16 of the Citizenship Directive. Second, it clarified that the CSI requirement applied to both EU national children and their third-country national parent caring for them, emphasizing that coverage could be under either the child’s or parent’s name.

Crucially, the CJEU stated that being covered by a host Member State’s public sickness insurance system, like the NHS, fulfills the CSI requirement. However, it acknowledged that Member States could impose conditions to prevent unreasonable burdens on public finances, such as requiring supplementary private insurance or contributions to the public system. The CJEU emphasized that any such conditions must be proportionate.

The CJEU also ruled out the applicability of the Texeira precedent, confirming that both VI and her son needed CSI coverage. Finally, it declined to address whether the UK’s reciprocal healthcare arrangements with Ireland under the Common Travel Area satisfied the CSI requirement, as the specifics of those arrangements weren’t sufficiently clarified in the referred questions.

Comments

General

While the VI case clarified that NHS coverage constitutes CSI, it’s debatable whether it should have been the case to establish this definition, as HMRC had already conceded the primary point of contention. This suggests the case might have been strategically framed to elicit a ruling on the NHS’s status within EU law.

The judgment’s implications for other Member States with public healthcare systems are significant. It allows them to impose charges on economically inactive EU nationals, potentially mirroring the UK’s Immigration Health Surcharge. However, the proportionality requirement might limit such charges’ impact, as administrative costs might outweigh potential revenue.

VI and Brexit?

For the UK, VI raises questions about potential redress for EU nationals denied benefits or citizenship due to the CSI requirement. While a Francovich claim for state liability seems applicable, the EU (Withdrawal) Act 2018 generally bars such claims post-Brexit. However, an exception exists for claims related to pre-Brexit events and initiated within two years of the exit day. This opens a window for affected individuals to seek damages until the end of 2022.

The possibility of pursuing Francovich claims after 2022 rests on whether this domestic law provision contradicts the Withdrawal Agreement. The argument hinges on whether state liability, as an EU law principle, falls under the Agreement’s scope and if the CJEU’s judgments retain their binding power post-Brexit.

Regarding ongoing UK policy, the VI judgment creates complexities for EU nationals with “settled status” who still need to demonstrate CSI compliance for pre-Brexit residency periods. This requirement might be challenged based on the argument that “CSI cover,” as demanded by the UK for naturalization, falls under the Withdrawal Agreement’s purview and should be interpreted according to CJEU case law.

VI and Northern Ireland?

The VI judgment’s impact on Northern Ireland is unique due to the Protocol on Ireland/Northern Ireland. Article 2 of the Protocol ensures no diminution of rights guaranteed by the Good Friday Agreement. Since the EU (Withdrawal) Act 2018 effectively diminishes the right to an effective remedy for pre-Brexit EU law breaches, a claim could be made that this constitutes a diminution directly resulting from Brexit. This might offer EU nationals in Northern Ireland a legal avenue even after 2022.

Conclusion

While the CJEU’s decision in VI seemingly arrived after the UK’s departure from the EU, its implications are potentially far-reaching. The judgment might offer a limited window for retrospective redress for affected EU nationals and introduce complexities for the UK government’s current citizenship policies. The extent of its impact will depend on the judiciary’s willingness to interpret the Withdrawal Agreement’s provisions, particularly concerning state liability and the ’no diminution’ commitment in Northern Ireland. This judgment, delivered during a politically sensitive time, could have significant and unforeseen consequences.

Photo credit: Matt Brown, via Wikimedia Commons