Francesca Strumia*, Connor Brown**

*Lecturer in Law, University of Sheffield

** LLB Law European and International, University of Sheffield

This post reflects the preliminary results of a research project conducted as part of the Sheffield Undergraduate Research Experience programme (SURE). It also builds on a presentation at the International Society of Public Law (ICON-S) annual conference in New York on 2nd July 2015

INTRODUCTION

Growing concerns about limited public funds, diminished international cooperation, and declining support for a more unified Europe have cast a shadow on a key principle: the free movement of people. This essential freedom, a cornerstone of European integration, now embodies these concerns. The right to non-discrimination for European Union migrants, irrespective of nationality, appears burdensome for member states to maintain. The concept of ‘minimum solidarity,’ which underpins the free movement of economically inactive individuals, resonates poorly with the European Union public. Furthermore, if viewed as a right for citizens rather than just workers, free movement evokes a ‘federalist’ vision of Europe, a notion considered taboo in a union striving for less integration. In this context, the once-celebrated “dream” of free movement has, in several aspects, transformed into a “nightmare,” to borrow the words of a 2014 editorial in the Common Market Law Review.

However, from a legal standpoint, how far does this “nightmare” extend? Two recent cases, Dano and Martens, provide some insight. Though distinct in their subject matter—one dealing with “welfare tourists” and the other with students—and their public profile, both cases highlight a critical difference: the treatment of claims against host member states versus those against home member states. This distinction has become a defining characteristic of the law concerning the free movement of European Union citizens. Claims against host states face stricter requirements, as exemplified by Dano. The case reinforces that non-economically active migrants are not entitled to residency in a host member state, let alone non-discrimination, if they pose a financial strain. In contrast, claims against home states receive more robust protection. Martens confirms that stringent residency rules for portable study grants are a disproportionate measure for home member states to avoid financial burdens.

Consequently, an imbalance arises in cases involving the movement of non-economically active individuals. This disparity exists between the protection of the right to enter (residing in a host state and claiming benefits without discrimination) and the right to exit (leaving and transferring benefits and entitlements from a home state). This imbalance stems partly from the evolution of the Court’s free movement test, which shifted from identifying discrimination to recognizing hindrances to movement. Specifically, the court now considers “any national measures which, even though applicable without discrimination on grounds of nationality, are capable of hindering or rendering less attractive the exercise by community nationals of the fundamental freedoms guaranteed by the treaty” (CJEU judgment in Government of the French Community and the Walloon Government v. Flemish Government). In non-worker cases, the application of this test signals a change in the interpretation of free movement rights. This shift compels us to ask: for whom does free movement constitute a financial burden? To what extent does it necessitate transnational solidarity? And, how closely aligned is the union it reflects?

This imbalance is particularly evident in the legal framework governing student mobility, with Martens being a recent example. This field is crucial for understanding the free movement of persons, as it reflects the transition of free movement from a right for workers to one for citizens. Moreover, fostering student mobility is a distinct objective of the Treaty (Article 165(2) TFEU). The significance of student mobility is also growing numerically. Between 2002 and 2012, the number of EU students pursuing education in an EU country other than their own (or in a non-EU EEA country or EU candidate country) rose by 87%, from 354,200 to 663,700. Furthermore, a 23% increase occurred between 2011 and 2012 alone, rising from 540,900 to 663,700 (Eurostat data).

THE ASYMMETRY IN STUDENTS’ CASE LAW

An examination of student case law reveals a potential imbalance in how the law addresses “entry-type claims” (e.g., residing in a host member state for study and receiving maintenance aid) and “exit-type claims” (e.g., portable study finance and tax relief in the home state for tuition paid in a host state). Regarding entry, secondary legislation (Directive 2004/38, the citizens’ Directive), implementing early case law (Raulin), recognizes the right to residency for students, but with conditions such as resource requirements and sickness insurance. Maintenance aid is accessible to EU students only after five years of residency in the host member state. Conversely, case law acknowledges students’ right to transfer study grants from a member state with which they demonstrate a genuine connection. Furthermore, students and their families can seek tax relief in their home member state for tuition paid in a host member state.

However, tuition fees present a counter-trend. EU students are entitled to equal treatment with host state nationals in this regard, arguably bolstering their entry claim. This aligns with early case law (Gravier) predating EU citizenship. Despite these apparent contrasts, the Court’s reasoning differs when applying a similar test to entry and exit claims. This difference is evident in cases concerning maintenance loans and grants in a host state and portable study finance.

Maintenance Loans/Portable Study Finance

Residency stipulations for receiving maintenance aid or transferring study finance can hinder free movement and may be discriminatory. However, to prevent migrant students from becoming an unreasonable financial strain, member states are generally allowed to offer study finance only to those demonstrating a degree of integration into the paying state’s society (Bidar). The Court’s case law, however, reveals a discrepancy in what constitutes a proportionate requirement for host and home states. In cases concerning maintenance aid in host states, the Court has upheld a strict five-year residency rule as a necessary and adequate means of proving integration (Förster). This fixed requirement, according to the Court, ensures legal certainty.

In contrast, the Court takes a different stance on cases involving portable study grants. It considers all predetermined residency prerequisites, including three-year residency (Prinz and Seeberger), permanent residence in the home state or a grant restricted to the host state of permanent residence (Thiele Meneses), and a three-out-of-six-previous-years rule (Martens) to be disproportionate. Notably, the three-out-of-six rule was the subject of a 2012 infringement proceeding, which deemed it a discriminatory violation of the free movement of workers. Interestingly, the relevant case (Commission v. Netherlands) viewed this rule from an entry perspective, specifically concerning the entry of migrant workers into the Netherlands and their right to equal treatment regarding study finance.

In these cases, the Court advocates for a more flexible approach to assessing integration, considering not only residency length but also qualitative connections like nationality, educational background, family ties, employment history, language proficiency, and other socio-economic aspects. The Court further substantiates its stricter scrutiny of such residency requirements by highlighting the significance of student and teacher mobility for integration (Articles 6(e) and 165(2) TFEU), an element absent in host state maintenance aid cases.

Genuine Links and Financial Burdens

Consequently, the same Court that tolerates host member states’ reluctance to support incoming students until after several years of residency is hesitant to impede students seeking to transfer entitlements. An unspoken implication of the Court’s approach is that nationality is a significant alternative to residency in demonstrating attachment, potentially enabling nationals to transfer study finance even from home states they have barely resided in (Thiele Meneses, which involved a German national raised in Brazil; Martens, involving a Dutch national who had spent more time in Belgium than in the Netherlands).

Furthermore, the Court’s stance suggests that member states’ concerns about avoiding systemic financial strains carry different weight when confronting claims from inbound and outbound students. This is apparent in cases regarding tax relief in home states for school and university fees paid in host states. A member state can cap such tax relief to match the amount applicable for national fees but cannot entirely deny relief for fees paid in another member state (Schwarz and Gootjes-Schwarz; Zanotti). This holds even when the tax-relieving state receives no portion of the paid fees, regardless of whether they are paid to public or private institutions.

Home-Coming Schemes

The Court, in a recent case (Giersch) involving student-family members of frontier workers, hinted at a potential shift in approach, even in cases concerning students not related to migrant workers. The Court indicated that promoting high education rates among residents and boosting the economy are legitimate state interests. It suggested that requiring students receiving portable study finance to return and work in the paying state after graduation is a suitable means to achieve these goals. Recognizing such “home-coming” requirements as legitimate restrictions on student free movement would alter the existing balance between the right to exit and the right to enter. These requirements would link the right to exit with an obligation to return, hindering the natural progression of a student’s right to leave one state and integrate into another. This could potentially impede the free movement of workers. While it’s too early to draw definitive conclusions, it seems plausible that the Court would adopt a highly contextual approach when assessing the proportionality of such requirements (the suggestion arose in a case concerning Luxembourg, a state with an unusually low rate of highly educated residents and a disproportionately high non-resident working population).

IMPLICATIONS

The imbalance observed in student mobility case law, with necessary modifications, could extend to other areas. This disparity has two significant implications warranting further examination. First, it raises the question of who bears the financial burden of free movement. In the case of students, the answer depends on the balance between home and host states. For example, member states receiving a high number of EU student migrants while sending out a moderate number may find free movement financially beneficial. These states’ expenditures on outbound student finance are offset by the tuition revenue from inbound students. The United Kingdom, which in 2012 sent approximately 17,000 students to other EU/EEA/EU candidate countries while receiving about 200,000 (Eurostat data), serves as a case in point. This observation invites further reflection on transnational solidarity within the EU. What model of affiliation does it rely on (D. Thym)? To what extent should it be linked to the nature of the social benefit involved (F. De Witte) rather than the individual’s status?

Second, this imbalance prompts a reevaluation of EU citizenship and its relationship with national citizenship. EU citizenship is often perceived as a threat, potentially undermining the rights and status of national citizenship (according to Gareth Davies, “residence is the new nationality” in the context of EU citizenship). In this sense, it represents one of the more ‘federalist’ achievements of European integration. However, at least regarding student free movement, EU citizenship seems to reinforce national citizenship. It enables the transfer of rights tied to national citizenship, extending its reach beyond national borders. Conversely, renouncing or losing EU citizenship would essentially confine national citizenship to its original boundaries.

Further Reading

Francesca Strumia, ‘Individual Rights, Interstate Equality, State Autonomy: European Horizontal Citizenship and its (Lonely) Playground in Trans-Atlantic Perspective’

 (forthcoming in Dimitry Kochenov (ed) EU Citizenship and Federalism: the Role of Rights,

CUP 2015)

Floris De Witte, ‘Who Funds the Mobile Student? Shedding Some Light on the Normative Assumptions Underlying EU Free Movement Law’ (2013) 50 C.M.L.Rev. 203

Daniel Thym, ‘The Elusive Limits of Solidarity: Residence Rights of and Social Rights for Economically Inactive Union Citizens’ (2015) 52 C.M.L.Rev. 17

Gareth Davies, ‘“Any Place I Hang my Hat” or Residence is the New Nationality’ (2005) 11 E.L.J. 43

Barnard & Peers: chapter 13

Photo: Francesca Strumia