Dutch work permit changes in 2017

Dutch work permit changes in 2017: New rules on Intra-Corporate Transfers

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A new EU directive on Intra-Corporate Transfers has been implemented in the Netherlands, which will affect the kennismigrant scheme. Read to see if the changes apply to your Dutch work permit.

On 29 November 2016, the EU Intra-Corporate Transfers (ICT) Directive was implemented in the Netherlands, introducing the EU ICT permit and bringing about the biggest change Dutch labour migration policy has seen in years. Previously, the Dutch immigration system mostly relied on the Highly Skilled Migrant (HSM) or kennismigrant scheme to bring foreign workers to the Netherlands, a highly favourable migration category used for local hires and intra-company transfers. With the implementation of the new EU ICT permit, the HMS scheme can no longer be used for most intra-corporate transfers. Though the new work permit introduces intra-EU mobility rights, which are unique in the European Union, it does have some disadvantages over the kennismigrant scheme.

International immigration law expert Fragomen Worldwide explains how the new immigration law changes in the Netherlands will affect intra-corporate transfers and Dutch work permits from the highly skilled migrant route starting 2017.

The Dutch migration system: HSM scheme

In the early 2000’s the Dutch government recognised the need for more highly skilled workers, as research showed that the Netherlands was facing a lack of skilled labour in the medium and long term. To this end, the HSM scheme was introduced in 2004, a favourable permit for locally hired foreign nationals and intra-corporate transferees, available to companies who are registered as a ‘recognised sponsor’.

The upside of this scheme is that employers can get permits for their required foreign personnel, without too many requirements in place: the third country worker must meet the salary threshold, and the salary must be market conform. The government aims to approve such applications in only two weeks. Next to the HSM scheme, other immigration options are available for local hires and intra-corporate transferees, but the requirements are more strict and the processing times are much longer.

The Intra-Corporate Transfer Directive

The ICT Directive was concluded between the EU Member States (except Denmark, Ireland and the United Kingdom) in 2014 with the aim to streamline the admission criteria for intra-corporate transfers throughout the EU. This concerns employees working for companies outside the EU who are temporarily assigned to an EU entity in the same corporate group. The Directive is specifically aimed at managers, specialists and trainees and introduces, for the first time, the right to work in multiple Member States.

HSM scheme vs EU ICT permit: Stricter requirements and a shorter validity

To ensure the ICT Directive is used throughout the EU, Member States have to provide this permit to all intra-corporate transferees who fall into the scope of the Directive. In the Netherlands, this is interpreted as meaning that all third country managers, specialist and trainees with an employment contract outside the EU assigned to the Netherlands, must obtain the EU ICT permit.

However, the conditions to be fulfilled are more strict than those for the HSM scheme. Foreign nationals:

  • Must have prior experience at the group company of at least 3 months
  • Must have a Bachelor’s or Master’s diploma or have worked at this level for 5 years
  • Cannot have their main residence in the Netherlands when applying for this permit


None of these requirements apply to the Dutch HSM scheme. 

Next to that, the maximum validity of the EU ICT permit is three years, after which the Dutch government has introduced a cooling-off period of 6 months. This means that after 3 years, the EU ICT permit holder must leave the Netherlands, or must change his or her immigration status, for instance by receiving a local employment contract. Under the HSM scheme, permits are issued for 5 years and are renewable indefinitely.

Companies registered as recognised sponsors for the HSM scheme also benefit from quicker processing times for the EU ICT permit; the authorities will aim to approve the permits in 2 weeks. Non-recognised companies will have to wait 7 to 12 weeks for their permits to be approved, as a more thorough check is required.

Assignees who can still make use of the HSM scheme

Some assignees can still make use of the HSM scheme. Assignees already in the Netherlands on a HSM permit can continue to extend their HSM permit. Also, assignees on an employment contract within the EU, transferred to the Netherlands, can make use of the HSM scheme.

Third country workers assigned to the Netherlands for a maximum of 90 days can still apply for a short-term work permit. 

Intra-EU mobility

The ICT directive introduces far reaching intra-EU mobility rights. With an EU ICT permit you can stay and work in other EU Member States for 90 days in a 180-day period per Member State, though a notification may be required. For stay and work over 90 days in a second Member States, the second Member State either requires a notification, or requires you to obtain a second ‘Mobile ICT permit’. In both cases, you can start working after the notification or permit application is filed.

The Dutch government requires a notification for short-term mobility to the Netherlands and a Mobile ICT permit for long term mobility.

At this point, only 4 Member States have implemented the new permit: Spain, Romania, Bulgaria and the Netherlands. Whether or not the short and long term mobility can be performed in the Member States which have not yet implemented the Directive has not yet been confirmed.

How does this impact Dutch companies

Dutch companies who will now need to obtain EU ICT permits will have to take into account the stricter requirements and shorter duration when planning their assignments, and may for instance need to consider putting assignees on a local employment contract if they need to stay after the initial 3 years.

How does this impact third country workers assigned to the Netherlands

Not much changes for third country managers and specialist assigned to a Dutch recognised sponsor in terms of documents required or processing times, as the process is much alike the HSM process. Trainees are required to submit additional documents. Third country workers assigned to a non-recognised company may need to submit additional documents and may face longer processing times. However, spouses of third country workers assigned to a non-recognised company, who receive the EU ICT permit, will now be allowed to work in the Netherlands, which was not allowed previously.

Conclusion

While the EU ICT permit is a small step back in Dutch migration policy, it is a huge step forward in creating a more harmonised European migration policy. Before the implementation of the Directive, work authorisation was mostly a national matter, meaning that companies who want to send employees to multiple countries have to check the requirements and may need to apply for permits in multiple Member States. The new streamlined rules can be very beneficial for assignees in a European role who have to work in multiple Member States, though it may take some time before the Directive is implemented throughout the EU. 

Senior Immigration Consultant Andrea de Bie, Fragomen Worldwide / Expatica

 
 

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