title: Council Directive 2009/50/EC of 25 May 2009 on the conditions of entry and residence of third-country nationals for the purposes of highly qualified employment

text:
               18.6.2009

               EN

               Official Journal of the European Union

               L 155/17

      COUNCIL DIRECTIVE 2009/50/EC
   of 25 May 2009
   on the conditions of entry and residence of third-country nationals for the purposes of highly qualified employment
   THE COUNCIL OF THE EUROPEAN UNION,
   Having regard to the Treaty establishing the European Community, and in particular points (3)(a) and (4) of the first subparagraph of Article 63 thereof,
   Having regard to the proposal from the Commission,
   Having regard to the opinion of the European Parliament (1),
   After consulting the European Economic and Social Committee (2),
   After consulting the Committee of the Regions (3),
   Whereas:

               (1)

               For the gradual establishment of an area of freedom, security and justice, the Treaty provides for measures to be adopted in the fields of asylum, immigration and protection of the rights of third-country nationals.

               (2)

               The Treaty provides that the Council is to adopt measures on immigration policy relating to conditions of entry and residence, standards on procedures for the issue by Member States of long-term visas and residence permits, and measures defining the rights and conditions under which nationals of third-countries who are legally resident in a Member State may reside in other Member States.

               (3)

               The Lisbon European Council in March 2000 set the Community the objective of becoming the most competitive and dynamic knowledge-based economy in the world, capable of sustainable economic growth with more and better jobs and greater social cohesion by 2010. Measures to attract and retain highly qualified third-country workers as part of an approach based on the needs of Member States should be seen in the broader context established by the Lisbon Strategy and by the Commission Communication of 11 December 2007 on the integrated guidelines for growth and jobs.

               (4)

               The Hague Programme, adopted by the European Council on 4 and 5 November 2004, recognised that legal migration will play an important role in enhancing the knowledge-based economy in Europe, advancing economic development, and thus contributing to the implementation of the Lisbon Strategy. The European Council invited the Commission to present a policy plan on legal migration, including admission procedures, capable of responding promptly to fluctuating demands for migrant labour in the labour market.

               (5)

               The European Council of 14 and 15 December 2006 agreed on a series of steps for 2007, among which to develop well-managed legal immigration policies, fully respecting national competences, to assist Member States in meeting existing and future labour needs.

               (6)

               To achieve the objectives of the Lisbon Strategy it is also important to foster the mobility within the Union of highly qualified workers who are Union citizens, in particular those from the Member States which acceded in 2004 and 2007. In implementing this Directive, Member States are bound to respect the principle of Community preference as expressed, in particular, in the relevant provisions of the Acts of Accession of 2003 and 2005.

               (7)

               This Directive is intended to contribute to achieving these goals and addressing labour shortages by fostering the admission and mobility — for the purposes of highly qualified employment — of third-country nationals for stays of more than three months, in order to make the Community more attractive to such workers from around the world and sustain its competitiveness and economic growth. To reach these goals, it is necessary to facilitate the admission of highly qualified workers and their families by establishing a fast-track admission procedure and by granting them equal social and economic rights as nationals of the host Member State in a number of areas. It is also necessary to take into account the priorities, labour market needs and reception capacities of the Member States. This Directive should be without prejudice to the competence of the Member States to maintain or to introduce new national residence permits for any purpose of employment. The third-country nationals concerned should have the possibility to apply for an EU Blue Card or for a national residence permit. Moreover, this Directive should not affect the possibility for an EU Blue Card holder to enjoy additional rights and benefits which may be provided by national law, and which are compatible with this Directive.

               (8)

               This Directive should be without prejudice to the right of the Member States to determine the volumes of admission of third-country nationals entering their territory for the purposes of highly qualified employment. This should include also third-country nationals who seek to remain on the territory of a Member State in order to exercise a paid economic activity and who are legally resident in that Member State under other schemes, such as students having just completed their studies or researchers having been admitted pursuant to Council Directive 2004/114/EC of 13 December 2004 on the conditions of admission of third-country nationals for the purposes of studies, pupil exchange, unremunerated training or voluntary service (4) and Council Directive 2005/71/EC of 12 October 2005 on a specific procedure for admitting third-country nationals for the purposes of scientific research (5) respectively, and who do not enjoy consolidated access to the labour market of the Member State under Community or national law. Moreover, regarding volumes of admission, Member States retain the possibility not to grant residence permits for employment in general or for certain professions, economic sectors or regions.

               (9)

               For the purpose of this Directive, in order to evaluate if the third-country national concerned possesses higher education qualifications, reference may be made to ISCED (International Standard Classification of Education) 1997 levels 5a and 6.

               (10)

               This Directive should provide for a flexible demand-driven entry system, based on objective criteria, such as a minimum salary threshold comparable with the salary levels in the Member States, and on professional qualifications. The definition of a common minimum denominator for the salary threshold is necessary to ensure a minimum level of harmonisation in the admission conditions throughout the Community. The salary threshold determines a minimum level while Member States may define a higher salary threshold. Member States should fix their threshold in accordance with the situation and organisation of their respective labour markets and their general immigration policies. Derogation from the main scheme in terms of the salary threshold may be laid down for specific professions where it is considered by the Member State concerned that there is a particular lack of available workforce and where such professions are part of the major group 1 and 2 of the ISCO (International Standard Classification of Occupation) classification.

               (11)

               This Directive aims only at defining the conditions of entry and residence of third-country nationals for the purposes of highly qualified employment within the EU Blue Card system, including the eligibility criteria related to a salary threshold. The sole purpose of this salary threshold is to help to determine, taking into account a statistical observation published by the Commission (Eurostat) or by the Member States concerned, the scope of the EU Blue Card established by each Member State on the basis of common rules. It does not aim to determine salaries and therefore does not derogate from the rules or practices at Member State level or from collective agreements, and cannot be used to constitute any harmonisation in this field. This Directive fully respects the competences of Member States, particularly on employment, labour and social matters.

               (12)

               Once a Member State has decided to admit a third-country national fulfilling the relevant criteria, the third-country national who applied for an EU Blue Card should receive the specific residence permit provided for by this Directive, which should grant progressive access to the labour market and residence and mobility rights to him and his family. The deadline for examining the application for an EU Blue Card should not include the time required for the recognition of professional qualifications or the time required for issuing a visa, if required. This Directive is without prejudice to national procedures on the recognition of diplomas. The designation of the competent authorities under this Directive is without prejudice to the role and responsibilities of other national authorities and, where applicable, the social partners, with regard to the examination of, and the decision on, the application.

               (13)

               The format of the EU Blue Card should be in accordance with Council Regulation (EC) No 1030/2002 of 13 June 2002 laying down a uniform format for residence permits for third-country nationals (6), thus enabling the Member States to refer to the information, in particular, under which conditions the person is permitted to work.

               (14)

               Third-country nationals who are in possession of a valid travel document and an EU Blue Card issued by a Member State applying the Schengen acquis in full, should be allowed to enter into and move freely within the territory of another Member State applying the Schengen acquis in full, for a period of up to three months, in accordance with Regulation (EC) No 562/2006 of the European Parliament and of the Council of 15 March 2006 establishing a Community Code on the rules governing the movement of persons across borders (Schengen Borders Code) (7) and Article 21 of the Convention implementing the Schengen Agreement of 14 June 1985 between the Governments of the States of the Benelux Economic Union, the Federal Republic of Germany and the French Republic on the gradual abolition of checks at their common borders.

               (15)

               The occupational and geographical mobility of third-country highly qualified workers should be recognised as a primary mechanism for improving labour market efficiency, preventing skill shortages and offsetting regional imbalances. In order to respect the principle of Community preference and to avoid possible abuses of the system, the occupational mobility of a third-country highly qualified worker should be limited for the first two years of legal employment in a Member State.

               (16)

               This Directive fully respects equal treatment between nationals of the Member States and EU Blue Card holders in relation to pay, when they are in comparable situations.

               (17)

               Equal treatment of EU Blue Card holders does not cover measures in the field of vocational training which are covered under social assistance schemes.

               (18)

               EU Blue Card holders should enjoy equal treatment as regards social security. Branches of social security are defined in Council Regulation (EEC) No 1408/71 of 14 June 1971 on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community (8). Council Regulation (EC) No 859/2003 of 14 May 2003 extending the provisions of Regulation (EEC) No 1408/71 and Regulation (EEC) No 574/72 to nationals of third-countries who are not already covered by those provisions solely on the ground of their nationality (9) extends the provisions of Regulation (EEC) No 1408/71 to third-country nationals who are legally residing in the Community and who are in a cross-border situation. The provisions on equal treatment as regards social security in this Directive also apply directly to persons entering into the territory of a Member State directly from a third-country, provided that the person concerned is legally residing as holder of a valid EU Blue Card, including during the period of temporary unemployment, and he fulfils the conditions, set out under national law, for being eligible for the social security benefits concerned.
               Nevertheless, this Directive should not confer to the EU Blue Card holder more rights than those already provided in existing Community law in the field of social security for third-country nationals who have cross-border elements between Member States. This Directive, furthermore, should not grant rights in relation to situations which lie outside the scope of Community law such as, for example, the situation of family members residing in a third country.

               (19)

               Professional qualifications acquired by a third-country national in another Member State should be recognised in the same way as those of Union citizens. Qualifications acquired in a third country should be taken into account in conformity with Directive 2005/36/EC of the European Parliament and of the Council of 7 September 2005 on the recognition of professional qualifications (10).

               (20)

               The geographical mobility within the Community should be controlled and demand-driven during the first period of legal stay of the highly qualified third-country worker. Derogations from Council Directive 2003/109/EC of 25 November 2003 concerning the status of third-country nationals who are long-term residents (11) should be provided for in order not to penalise geographically mobile highly qualified third-country workers who have not yet acquired the EC long-term resident status referred to in that Directive, and in order to encourage geographical and circular migration.

               (21)

               The mobility of highly qualified third-country workers between the Community and their countries of origin should be fostered and sustained. Derogations from Directive 2003/109/EC should be provided for in order to extend the period of absence from the territory of the Community without interrupting the period of legal and continuous residence necessary to be eligible for EC long-term resident status. Longer periods of absence than those provided for in Directive 2003/109/EC should also be allowed after highly qualified third-country workers have acquired EC long-term resident status to encourage their circular migration.

               (22)

               In implementing this Directive, Member States should refrain from pursuing active recruitment in developing countries in sectors suffering from a lack of personnel. Ethical recruitment policies and principles applicable to public and private sector employers should be developed in key sectors, for example the health sector, as underlined in the Council and Member States’ conclusions of 14 May 2007 on the European Programme for Action to tackle the critical shortage of health workers in developing countries (2007 to 2013) and the education sector, as appropriate. These should be strengthened by the development and application of mechanisms, guidelines and other tools to facilitate, as appropriate, circular and temporary migration, as well as other measures that would minimise negative and maximise positive impacts of highly skilled immigration on developing countries in order to turn ‘brain drain’ into ‘brain gain’.

               (23)

               Favourable conditions for family reunification and for access to work for spouses should be a fundamental element of this Directive which aims to attract highly qualified third-country workers. Specific derogations to Council Directive 2003/86/EC of 22 September 2003 on the right to family reunification (12) should be provided for in order to reach this aim. The derogation included in Article 15(3) of this Directive does not preclude Member States from maintaining or introducing integration conditions and measures, including language learning, for the members of the family of an EU Blue Card holder.

               (24)

               Specific reporting provisions should be provided for to monitor the implementation of this Directive, with a view to identifying and possibly counteracting its possible impacts in terms of ‘brain drain’ in developing countries and in order to avoid ‘brain waste’. The relevant data should be transmitted annually by the Member States to the Commission in accordance with Regulation (EC) No 862/2007 of the European Parliament and of the Council of 11 July 2007 on Community statistics on migration and international protection (13).

               (25)

               Since the objectives of this Directive, namely the introduction of a special admission procedure and the adoption of conditions of entry and residence for more than three months applicable to third-country nationals in the Member States for the purposes of highly qualified employment and their family members, cannot be sufficiently achieved by the Member States, especially as regards ensuring their mobility between Member States, and can therefore be better achieved at Community level, the Community may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to achieve those objectives.

               (26)

               This Directive respects the fundamental rights and observes the principles recognised in particular in Article 6 of the Treaty on European Union and reflected in the Charter of Fundamental Rights of the European Union.

               (27)

               In accordance with paragraph 34 of the Interinstitutional agreement of the European Parliament, the Council and the Commission on better law-making (14), Member States are encouraged to draw up, for themselves and in the interest of the Community, their own tables, which will, as far as possible, illustrate the correlation between the Directive and the transposition measures, and make them public.

               (28)

               In accordance with Articles 1 and 2 of the Protocol on the position of the United Kingdom and Ireland, annexed to the Treaty on European Union and to the Treaty establishing the European Community and without prejudice to Article 4 of the said Protocol these Member States are not taking part in the adoption of this Directive and are not bound by or subject to its application.

               (29)

               In accordance with Articles 1 and 2 of the Protocol on the position of Denmark annexed to the Treaty on European Union and the Treaty establishing the European Community, Denmark is not participating in the adoption of this Directive, and is not bound by it or subject to its application,

         HAS ADOPTED THIS DIRECTIVE:
   CHAPTER I

      GENERAL PROVISIONS

   Article 1
   Subject matter
   The purpose of this Directive is to determine:

               (a)

               the conditions of entry and residence for more than three months in the territory of the Member States of third-country nationals for the purpose of highly qualified employment as EU Blue Card holders, and of their family members;

               (b)

               the conditions for entry and residence of third-country nationals and of their family members under point (a) in Member States other than the first Member State.

         Article 2
   Definitions
   For the purposes of this Directive:

               (a)

               ‘third-country national’ means any person who is not a citizen of the Union within the meaning of Article 17(1) of the Treaty;

               (b)

               ‘highly qualified employment’ means the employment of a person who:

                           —

                           in the Member State concerned, is protected as an employee under national employment law and/or in accordance with national practice, irrespective of the legal relationship, for the purpose of exercising genuine and effective work for, or under the direction of, someone else,

                           —

                           is paid, and,

                           —

                           has the required adequate and specific competence, as proven by higher professional qualifications,

               (c)

               ‘EU Blue Card’ means the authorisation bearing the term ‘EU Blue Card’ entitling its holder to reside and work in the territory of a Member State under the terms of this Directive;

               (d)

               ‘first Member State’ means the Member State which first grants a third-country national an ‘EU Blue Card’;

               (e)

               ‘second Member State’ means any Member State other than the first Member State;

               (f)

               ‘family members’ means third-country nationals as defined in Article 4(1) of Directive 2003/86/EC;

               (g)

               ‘higher professional qualifications’ means qualifications attested by evidence of higher education qualifications or, by way of derogation, when provided for by national law, attested by at least five years of professional experience of a level comparable to higher education qualifications and which is relevant in the profession or sector specified in the work contract or binding job offer;

               (h)

               ‘higher education qualification’ means any diploma, certificate or other evidence of formal qualifications issued by a competent authority attesting the successful completion of a post-secondary higher education programme, namely a set of courses provided by an educational establishment recognised as a higher education institution by the State in which it is situated. For the purposes of this Directive, a higher education qualification shall be taken into account, on condition that the studies needed to acquire it lasted at least three years;

               (i)

               ‘professional experience’ means the actual and lawful pursuit of the profession concerned;

               (j)

               ‘regulated profession’ means a regulated profession as defined in Article 3(1)(a) of Directive 2005/36/EC.

         Article 3
   Scope
   1.   This Directive shall apply to third-country nationals who apply to be admitted to the territory of a Member State for the purpose of highly qualified employment under the terms of this Directive.
   2.   This Directive shall not apply to third-country nationals:

               (a)

               who are authorised to reside in a Member State on the basis of temporary protection or have applied for authorisation to reside on that basis and are awaiting a decision on their status;

               (b)

               who are beneficiaries of international protection under Council Directive 2004/83/EC of 29 April 2004 on minimum standards for the qualification and status of third-country nationals or stateless persons as refugees or as persons who otherwise need international protection and the content of the protection granted (15) or have applied for international protection under that Directive and whose application has not yet given rise to a final decision;

               (c)

               who are beneficiaries of protection in accordance with national law, international obligations or practice of the Member State or have applied for protection in accordance with national law, international obligations or practice of the Member State and whose application has not given rise to a final decision;

               (d)

               who apply to reside in a Member State as researchers, within the meaning of Directive 2005/71/EC, in order to carry out a research project;

               (e)

               who are family members of Union citizens who have exercised, or are exercising, their right to free movement within the Community in conformity with Directive 2004/38/EC of the European Parliament and of the Council of 29 April 2004 on the right of citizens of the Union and their family members to move and reside freely within the territory of the Member States (16);

               (f)

               who enjoy EC long-term resident status in a Member State in accordance with Directive 2003/109/EC and exercise their right to reside in another Member State in order to carry out an economic activity in an employed or self-employed capacity;

               (g)

               who enter a Member State under commitments contained in an international agreement facilitating the entry and temporary stay of certain categories of trade and investment-related natural persons;

               (h)

               who have been admitted to the territory of a Member State as seasonal workers;

               (i)

               whose expulsion has been suspended for reasons of fact or law;

               (j)

               who are covered by Directive 96/71/EC of the European Parliament and of the Council of 16 December 1996 concerning the posting of workers in the framework of the provision of services (17) as long as they are posted on the territory of the Member State concerned.

         In addition, this Directive shall not apply to third-country nationals and their family members, whatever their nationality, who, under agreements between the Community and its Member States and those third countries enjoy rights of free movement equivalent to those of Union citizens.
   3.   This Directive shall be without prejudice to any agreement between the Community and/or its Member States and one or more third countries, that lists the professions which should not fall under this Directive in order to assure ethical recruitment, in sectors suffering from a lack of personnel, by protecting human resources in the developing countries which are signatories to these agreements.
   4.   This Directive shall be without prejudice to the right of the Member States to issue residence permits other than an EU Blue Card for any purpose of employment. Such residence permits shall not confer the right of residence in the other Member States as provided for in this Directive.
   Article 4
   More favourable provisions
   1.   This Directive shall be without prejudice to more favourable provisions of:

               (a)

               Community law, including bilateral or multilateral agreements concluded between the Community or between the Community and its Member States and one or more third countries;

               (b)

               bilateral or multilateral agreements concluded between one or more Member States and one or more third countries.

         2.   This Directive shall not affect the right of Member States to adopt or retain more favourable provisions for persons to whom it applies in respect of the following provisions of this Directive:

               (a)

               Article 5(3) in application of Article 18;

               (b)

               Articles 11, 12(1), second sentence, 12(2), 13, 14, 15 and 16(4).

         CHAPTER II

      CONDITIONS OF ADMISSION

   Article 5
   Criteria for admission
   1.   Without prejudice to Article 10(1), a third-country national who applies for an EU Blue Card under the terms of this Directive shall:

               (a)

               present a valid work contract or, as provided for in national law, a binding job offer for highly qualified employment, of at least one year in the Member State concerned;

               (b)

               present a document attesting fulfilment of the conditions set out under national law for the exercise by Union citizens of the regulated profession specified in the work contract or binding job offer as provided for in national law;

               (c)

               for unregulated professions, present the documents attesting the relevant higher professional qualifications in the occupation or sector specified in the work contract or in the binding job offer as provided for in national law;

               (d)

               present a valid travel document, as determined by national law, an application for a visa or a visa, if required, and evidence of a valid residence permit or of a national long-term visa, if appropriate. Member States may require the period of validity of the travel document to cover at least the initial duration of the residence permit;

               (e)

               present evidence of having or, if provided for by national law, having applied for a sickness insurance for all the risks normally covered for nationals of the Member State concerned for periods where no such insurance coverage and corresponding entitlement to benefits are provided in connection with, or resulting from, the work contract;

               (f)

               not be considered to pose a threat to public policy, public security or public health.

         2.   Member States may require the applicant to provide his address in the territory of the Member State concerned.
   3.   In addition to the conditions laid down in paragraph 1, the gross annual salary resulting from the monthly or annual salary specified in the work contract or binding job offer shall not be inferior to a relevant salary threshold defined and published for that purpose by the Member States, which shall be at least 1,5 times the average gross annual salary in the Member State concerned.
   4.   When implementing paragraph 3, Member States may require that all conditions in the applicable laws, collective agreements or practices in the relevant occupational branches for highly qualified employment are met.
   5.   By way of derogation to paragraph 3, and for employment in professions which are in particular need of third-country national workers and which belong to the major groups 1 and 2 of ISCO, the salary threshold may be at least 1,2 times the average gross annual salary in the Member State concerned. In this case, the Member State concerned shall communicate each year to the Commission the list of the professions for which a derogation has been decided.
   6.   This Article shall be without prejudice to the applicable collective agreements or practices in the relevant occupational branches for highly qualified employment.
   Article 6
   Volumes of admission
   This Directive shall not affect the right of a Member State to determine the volume of admission of third-country nationals entering its territory for the purposes of highly qualified employment.
   CHAPTER III

      EU BLUE CARD, PROCEDURE AND TRANSPARENCY

   Article 7
   EU Blue Card
   1.   A third-country national who has applied and fulfils the requirements set out in Article 5 and for whom the competent authorities have taken a positive decision in accordance with Article 8 shall be issued with an EU Blue Card.
   The Member State concerned shall grant the third-country national every facility to obtain the requisite visas.
   2.   Member States shall set a standard period of validity of the EU Blue Card, which shall be comprised between one and four years. If the work contract covers a period less than this period, the EU Blue Card shall be issued or renewed for the duration of the work contract plus three months.
   3.   The EU Blue Card shall be issued by the competent authorities of the Member State using the uniform format as laid down in Regulation (EC) No 1030/2002. In accordance with point (a) 7,5-9 of the Annex to that Regulation, Member States shall indicate on the EU Blue Card the conditions for access to the labour market as set out in Article 12(1) of this Directive. Under the heading ‘type of permit’ in the residence permit, Member States shall enter ‘EU Blue Card’.
   4.   During the period of its validity, the EU Blue Card shall entitle its holder to:

               (a)

               enter, re-enter and stay in the territory of the Member State issuing the EU Blue Card;

               (b)

               the rights recognised in this Directive.

         Article 8
   Grounds for refusal
   1.   Member States shall reject an application for a EU Blue Card whenever the applicant does not meet the conditions set out in Article 5 or whenever the documents presented have been fraudulently acquired, or falsified or tampered with.
   2.   Before taking the decision on an application for an EU Blue Card, and when considering renewals or authorisations pursuant to Article 12(1) and (2) during the first two years of legal employment as an EU Blue Card holder, Member States may examine the situation of their labour market and apply their national procedures regarding the requirements for filling a vacancy.
   Member States may verify whether the concerned vacancy could not be filled by national or Community workforce, by third-country nationals lawfully resident in that Member State and already forming part of its labour market by virtue of Community or national law, or by EC long-term residents wishing to move to that Member State for highly qualified employment in accordance with Chapter III of Directive 2003/109/EC.
   3.   An application for an EU Blue Card may also be considered as inadmissible on the grounds of Article 6.
   4.   Member States may reject an application for an EU Blue Card in order to ensure ethical recruitment in sectors suffering from a lack of qualified workers in the countries of origin.
   5.   Member States may reject an application for an EU Blue Card if the employer has been sanctioned in conformity with national law for undeclared work and/or illegal employment.
   Article 9
   Withdrawal or non-renewal of the EU Blue Card
   1.   Member States shall withdraw or refuse to renew an EU Blue Card issued on the basis of this Directive in the following cases:

               (a)

               when it has been fraudulently acquired, or has been falsified or tampered with;

               (b)

               wherever it appears that the holder did not meet or no longer meets the conditions for entry and residence laid down in this Directive or is residing for purposes other than that for which the holder was authorised to reside;

               (c)

               when the holder has not respected the limitations set out in Articles 12(1) and (2) and 13.

         2.   The lack of communication pursuant to Article 12(2) second subparagraph and 13(4) shall not be considered to be a sufficient reason for withdrawing or not renewing the EU Blue Card if the holder can prove that the communication did not reach the competent authorities for a reason independent of the holder's will.
   3.   Member States may withdraw or refuse to renew an EU Blue Card issued on the basis of this Directive in the following cases:

               (a)

               for reasons of public policy, public security or public health;

               (b)

               wherever the EU Blue Card holder does not have sufficient resources to maintain himself and, where applicable, the members of his family, without having recourse to the social assistance system of the Member State concerned. Member States shall evaluate these resources by reference to their nature and regularity and may take into account the level of minimum national wages and pensions as well as the number of family members of the person concerned. Such evaluation shall not take place during the period of unemployment referred to in Article 13;

               (c)

               if the person concerned has not communicated his address;

               (d)

               when the EU Blue Card holder applies for social assistance, provided that the appropriate written information has been provided to him in advance by the Member State concerned.

         Article 10
   Applications for admission
   1.   Member States shall determine whether applications for an EU Blue Card are to be made by the third-country national and/or by his employer.
   2.   The application shall be considered and examined either when the third-country national concerned is residing outside the territory of the Member State to which he wishes to be admitted or when he is already residing in that Member State as holder of a valid residence permit or national long-stay visa.
   3.   By way of derogation from paragraph 2, a Member State may accept, in accordance with its national law, an application submitted when the third-country national concerned is not in possession of a valid residence permit but is legally present in its territory.
   4.   By way of derogation from paragraph 2, a Member State may provide that an application can only be submitted from outside its territory, provided that such limitations, either for all the third-country nationals or for specific categories of third-country nationals, are already set out in the existing national law at the time of the adoption of this Directive.
   Article 11
   Procedural safeguards
   1.   The competent authorities of the Member States shall adopt a decision on the complete application for an EU Blue Card and notify the applicant in writing, in accordance with the notification procedures laid down in the national law of the Member State concerned, as soon as possible and at the latest within 90 days of the application being lodged.
   National law of the relevant Member State shall determine any consequence of a decision not having been taken by the end of the period provided for in the first subparagraph.
   2.   Where the information or documents supplied in support of the application are inadequate, the competent authorities shall notify the applicant of the additional information that is required and set a reasonable deadline for providing it. The period referred to in paragraph 1 shall be suspended until the authorities have received the additional information or documents required. If additional information or documents have not been provided within the deadline, the application may be rejected.
   3.   Any decision rejecting an application for an EU Blue Card, a decision not to renew or to withdraw an EU Blue Card, shall be notified in writing to the third-country national concerned and, where relevant, to his employer in accordance with the notification procedures under the relevant national law and shall be open to legal challenge in the Member State concerned, in accordance with national law. The notification shall specify the reasons for the decision, the possible redress procedures available and the time limit for taking action.
   CHAPTER IV

      RIGHTS

   Article 12
   Labour market access
   1.   For the first two years of legal employment in the Member State concerned as an EU Blue Card holder, access to the labour market for the person concerned shall be restricted to the exercise of paid employment activities which meet the conditions for admission set out in Article 5. After these first two years, Member States may grant the persons concerned equal treatment with nationals as regards access to highly qualified employment.
   2.   For the first two years of legal employment in the Member State concerned as an EU Blue Card holder, changes in employer shall be subject to the prior authorisation in writing of the competent authorities of the Member State of residence, in accordance with national procedures and within the time limits set out in Article 11(1). Modifications that affect the conditions for admission shall be subject to prior communication or, if provided for by national law, prior authorisation.
   After these first two years, where the Member State concerned does not make use of the possibility provided for in paragraph 1 regarding equal treatment, the person concerned shall, in accordance with national procedures, communicate changes that affect the conditions of Article 5 to the competent authorities of the Member State of residence.
   3.   Member States may retain restrictions on access to employment, provided such employment activities entail occasional involvement in the exercise of public authority and the responsibility for safeguarding the general interest of the State and where, in accordance with existing national or Community law, these activities are reserved to nationals.
   4.   Member States may retain restrictions on access to employment activities, in cases where, in accordance with existing national or Community law, these activities are reserved to nationals, Union citizens or EEA citizens.
   5.   This Article shall be applied without prejudice to the principle of Community preference as expressed in the relevant provisions of the Acts of Accession of 2003 and 2005, in particular with respect to the rights of nationals of the Member States concerned to access the labour market.
   Article 13
   Temporary unemployment
   1.   Unemployment in itself shall not constitute a reason for withdrawing an EU Blue Card, unless the period of unemployment exceeds three consecutive months, or it occurs more than once during the period of validity of an EU Blue Card.
   2.   During the period referred to in paragraph 1, the EU Blue Card holder shall be allowed to seek and take up employment under the conditions set out in Article 12.
   3.   Member States shall allow the EU Blue Card holder to remain on their territory until the necessary authorisation pursuant to Article 12(2) has been granted or denied. The communication under Article 12(2) shall automatically end the period of unemployment.
   4.   The EU Blue Card holder shall communicate the beginning of the period of unemployment to the competent authorities of the Member State of residence, in accordance with the relevant national procedures.
   Article 14
   Equal treatment
   1.   EU Blue Card holders shall enjoy equal treatment with nationals of the Member State issuing the Blue Card, as regards:

               (a)

               working conditions, including pay and dismissal, as well as health and safety requirements at the workplace;

               (b)

               freedom of association and affiliation and membership of an organisation representing workers or employers or of any organisation whose members are engaged in a specific occupation, including the benefits conferred by such organisations, without prejudice to the national provisions on public policy and public security;

               (c)

               education and vocational training;

               (d)

               recognition of diplomas, certificates and other professional qualifications in accordance with the relevant national procedures;

               (e)

               provisions in national law regarding the branches of social security as defined in Regulation (EEC) No 1408/71. The special provisions in the Annex to Regulation (EC) No 859/2003 shall apply accordingly;

               (f)

               without prejudice to existing bilateral agreements, payment of income-related acquired statutory pensions in respect of old age, at the rate applied by virtue of the law of the debtor Member State(s) when moving to a third country;

               (g)

               access to goods and services and the supply of goods and services made available to the public, including procedures for obtaining housing, as well as information and counselling services afforded by employment offices;

               (h)

               free access to the entire territory of the Member State concerned, within the limits provided for by national law.

         2.   With respect to paragraph 1(c) and (g) the Member State concerned may restrict equal treatment as regards study and maintenance grants and loans or other grants and loans regarding secondary and higher education and vocational training, and procedures for obtaining housing.
   With respect to paragraph 1(c):

               (a)

               access to university and post-secondary education may be subject to specific prerequisites in accordance with national law;

               (b)

               the Member State concerned may restrict equal treatment to cases where the registered or usual place of residence of the EU Blue Card holder, or that of the family member for whom benefits are claimed, lies within its territory.

         Paragraph 1(g) shall be without prejudice to the freedom of contract in accordance with Community and national law.
   3.   The right to equal treatment as laid down in paragraph 1 shall be without prejudice to the right of the Member State to withdraw or to refuse to renew the EU Blue Card in accordance with Article 9.
   4.   When the EU Blue Card holder moves to a second Member State in accordance with Article 18 and a positive decision on the issuing of an EU Blue Card has not yet been taken, Member States may limit equal treatment in the areas listed in paragraph 1, with the exception of 1(b) and (d). If, during this period, Member States allow the applicant to work, equal treatment with nationals of the second Member State in all areas of paragraph 1 shall be granted.
   Article 15
   Family members
   1.   Directive 2003/86/EC shall apply with the derogations laid down in this Article.
   2.   By way of derogation from Articles 3(1) and 8 of Directive 2003/86/EC, family reunification shall not be made dependent on the requirement of the EU Blue Card holder having reasonable prospects of obtaining the right of permanent residence and having a minimum period of residence.
   3.   By way of derogation from the last subparagraph of Article 4(1) and Article 7(2) of Directive 2003/86/EC, the integration conditions and measures referred to therein may only be applied after the persons concerned have been granted family reunification.
   4.   By way of derogation from the first subparagraph of Article 5(4) of Directive 2003/86/EC, residence permits for family members shall be granted, where the conditions for family reunification are fulfilled, at the latest within six months from the date on which the application was lodged.
   5.   By way of derogation from Article 13(2) and (3) of Directive 2003/86/EC, the duration of validity of the residence permits of family members shall be the same as that of the residence permits issued to the EU Blue Card holder insofar as the period of validity of their travel documents allows it.
   6.   By way of derogation from the second sentence of Article 14(2) of Directive 2003/86/EC, Member States shall not apply any time limit in respect of access to the labour market.
   This paragraph is applicable from 19 December 2011.
   7.   By way of derogation to Article 15(1) of Directive 2003/86/EC, for the purposes of calculation of the five years of residence required for the acquisition of an autonomous residence permit, residence in different Member States may be cumulated.
   8.   If Member States have recourse to the option provided for in paragraph 7, the provisions set out in Article 16 of this Directive in respect of accumulation of periods of residence in different Member States by the EU Blue Card holder shall apply mutatis mutandis.
   Article 16
   EC long-term resident status for EU Blue Card holders
   1.   Directive 2003/109/EC shall apply with the derogations laid down in this Article.
   2.   By way of derogation from Article 4(1) of Directive 2003/109/EC, the EU Blue Card holder having made use of the possibility provided for in Article 18 of this Directive is allowed to cumulate periods of residence in different Member States in order to fulfil the requirement concerning the duration of residence, if the following conditions are met:

               (a)

               five years of legal and continuous residence within the territory of the Community as an EU Blue Card holder; and

               (b)

               legal and continuous residence for two years immediately prior to the submission of the relevant application as an EU Blue Card holder within the territory of the Member State where the application for the long-term resident's EC residence permit is lodged.

         3.   For the purpose of calculating the period of legal and continuous residence in the Community and by way of derogation from the first subparagraph of Article 4(3) of Directive 2003/109/EC, periods of absence from the territory of the Community shall not interrupt the period referred to in paragraph 2(a) of this Article if they are shorter than 12 consecutive months and do not exceed in total 18 months within the period referred to in paragraph 2(a) of this Article. This paragraph shall apply also in cases where the EU Blue Card holder has not made use of the possibility provided for in Article 18.
   4.   By way of derogation from Article 9(1)(c) of Directive 2003/109/EC, Member States shall extend to 24 consecutive months the period of absence from the territory of the Community which is allowed to an EC long-term resident holder of a long-term residence permit with the remark referred to in Article 17(2) of this Directive and of his family members having been granted the EC long-term resident status.
   5.   The derogations to Directive 2003/109/EC set out in paragraphs 3 and 4 of this Article may be restricted to cases where the third-country national concerned can present evidence that he has been absent from the territory of the Community to exercise an economic activity in an employed or self-employed capacity, or to perform a voluntary service, or to study in his own country of origin.
   6.   Article 14(1)(f) and 15 shall continue to apply for holders of a long-term residence permit with the remark referred to in Article 17(2), where applicable, after the EU Blue Card holder has become an EC long-term resident.
   Article 17
   Long-term residence permit
   1.   EU Blue Card holders who fulfil the conditions set out in Article 16 of this Directive for the acquisition of the EC long-term resident status shall be issued with a residence permit in accordance with Article 1(2)(a) of Regulation (EC) No 1030/2002.
   2.   In the residence permit referred to in paragraph 1 of this Article under the heading ‘remarks’, Member States shall enter ‘Former EU Blue Card holder’.
   CHAPTER V

      RESIDENCE IN OTHER MEMBER STATES

   Article 18
   Conditions
   1.   After eighteen months of legal residence in the first Member State as an EU Blue Card holder, the person concerned and his family members may move to a Member State other than the first Member State for the purpose of highly qualified employment under the conditions set out in this Article.
   2.   As soon as possible and no later than one month after entering the territory of the second Member State, the EU Blue Card holder and/or his employer shall present an application for an EU Blue Card to the competent authority of that Member State and present all the documents proving the fulfilment of the conditions set out in Article 5 for the second Member State. The second Member State may decide, in accordance with national law, not to allow the applicant to work until the positive decision on the application has been taken by its competent authority.
   3.   The application may also be presented to the competent authorities of the second Member State while the EU Blue Card holder is still residing in the territory of the first Member State.
   4.   In accordance with the procedures set out in Article 11, the second Member State shall process the application and inform in writing the applicant and the first Member State of its decision to either:

               (a)

               issue an EU Blue Card and allow the applicant to reside on its territory for highly qualified employment where the conditions set in this Article are fulfilled and under the conditions set out in Articles 7 to 14; or

               (b)

               refuse to issue an EU Blue Card and oblige the applicant and his family members, in accordance with the procedures provided for by national law, including removal procedures, to leave its territory where the conditions set out in this Article are not fulfilled. The first Member State shall immediately readmit without formalities the EU Blue Card holder and his family members. This shall also apply if the EU Blue Card issued by the first Member State has expired or has been withdrawn during the examination of the application. Article 13 shall apply after readmission.

         5.   If the EU Blue Card issued by the first Member State expires during the procedure, Member States may issue, if required by national law, national temporary residence permits, or equivalent authorisations, allowing the applicant to continue to stay legally on its territory until a decision on the application has been taken by the competent authorities.
   6.   The applicant and/or his employer may be held responsible for the costs related to the return and readmission of the EU Blue Card holder and his family members, including costs incurred by public funds, where applicable, pursuant to paragraph 4(b).
   7.   In application of this Article, Member States may continue to apply volumes of admission as referred to in Article 6.
   8.   From the second time that an EU Blue Card holder, and where applicable, his family members, makes use of the possibility to move to another Member State under the terms of this Chapter, ‘first Member State’ shall be understood as the Member States from where the person concerned moves and ‘second Member State’ as the Member State to which he is applying to reside.
   Article 19
   Residence in the second Member State for family members
   1.   When the EU Blue Card holder moves to a second Member State in accordance with Article 18 and when the family was already constituted in the first Member State, the members of his family shall be authorised to accompany or join him.
   2.   No later than one month after entering the territory of the second Member State, the family members concerned or the EU Blue card holder, in accordance with national law, shall submit an application for a residence permit as a family member to the competent authorities of that Member State.
   In cases where the residence permit of the family members issued by the first Member State expires during the procedure or no longer entitles the holder to reside legally on the territory of the second Member State, Member States shall allow the person to stay in their territory, if necessary by issuing national temporary residence permits, or equivalent authorisations, allowing the applicant to continue to stay legally on their territory with the EU Blue Card holder until a decision on the application has been taken by the competent authorities of the second Member State.
   3.   The second Member State may require the family members concerned to present with their application for a residence permit:

               (a)

               their residence permit in the first Member State and a valid travel document, or their certified copies, as well as a visa, if required;

               (b)

               evidence that they have resided as members of the family of the EU Blue Card holder in the first Member State;

               (c)

               evidence that they have a sickness insurance covering all risks in the second Member State, or that the EU Blue Card holder has such insurance for them.

         4.   The second Member State may require the EU Blue Card holder to provide evidence that the holder:

               (a)

               has an accommodation regarded as normal for a comparable family in the same region and which meets the general health and safety standards in the Member State concerned;

               (b)

               has stable and regular resources which are sufficient to maintain himself and the members of his family, without recourse to the social assistance of the Member State concerned. Member States shall evaluate these resources by reference to their nature and regularity and may take into account the level of minimum national wages and pensions as well as the number of family members.

         5.   Derogations contained in Article 15 shall continue to apply mutatis mutandis.
   6.   Where the family was not already constituted in the first Member State, Article 15 shall apply.
   CHAPTER VI

      FINAL PROVISIONS

   Article 20
   Implementing measures
   1.   Member States shall communicate to the Commission and the other Member States if legislative or regulatory measures are enacted in respect of Articles 6, 8(2) and 18(6).
   Those Member States which make use of the provisions of Article 8(4) shall communicate to the Commission and to the other Member States a duly justified decision indicating the countries and sectors concerned.
   2.   Annually, and for the first time no later than 19 June 2013, Member States shall, in accordance with Regulation (EC) No 862/2007, communicate to the Commission statistics on the volumes of third-country nationals who have been granted an EU Blue Card and, as far as possible, volumes of third-country nationals whose EU Blue Card has been renewed or withdrawn, during the previous calendar year, indicating their nationality and, as far as possible, their occupation. Statistics on admitted family members shall be communicated in the same manner, except as regards information on their occupation. In relation to EU Blue Card holders and members of their families admitted in accordance with Articles 18, 19 and 20, the information provided shall, in addition, specify, as far as possible, the Member State of previous residence.
   3.   For the purpose of the implementation of Article 5(3) and, where appropriate, 5(5), reference shall be made to Commission (Eurostat) data and, where appropriate, national data.
   Article 21
   Reports
   Every three years, and for the first time no later than 19 June 2014, the Commission shall report to the European Parliament and the Council on the application of this Directive in the Member States, in particular the assessment of the impact of Articles 3(4), 5 and 18, and shall propose any amendments that are necessary.
   The Commission shall notably assess the relevance of the salary threshold defined in Article 5 and of the derogations provided for in that Article, taking into account, inter alia, the diversity of the economical, sectorial and geographical situations within the Member States.
   Article 22
   Contact points
   1.   Member States shall appoint contact points which shall be responsible for receiving and transmitting the information referred to in Articles 16, 18 and 20.
   2.   Member States shall provide appropriate cooperation in the exchange of the information and documentation referred to in paragraph 1.
   Article 23
   Transposition
   1.   Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 19 June 2011. They shall forthwith inform the Commission thereof.
   When Member States adopt those provisions, they shall contain a reference to this Directive or shall be accompanied by such reference on the occasion of their official publication. Member States shall determine how such reference is to be made.
   2.   Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field covered by this Directive.
   Article 24
   Entry into force
   This Directive shall enter into force on the day following its publication in the Official Journal of the European Union.
   Article 25
   Addressees
   This Directive is addressed to the Member States, in accordance with the Treaty establishing the European Community.

      Done at Brussels, 25 May 2009.

            For the Council

            The President

         J. ŠEBESTA

      (1)  Opinion of 20 November 2008 (not yet published in the Official Journal).

      (2)  Opinion of 9 July 2008 (not yet published in the Official Journal).

      (3)  Opinion of 18 June 2008 (not yet published in the Official Journal).

      (4)  OJ L 375, 23.12.2004, p. 12.

      (5)  OJ L 289, 3.11.2005, p. 15.

      (6)  OJ L 157, 15.6.2002, p. 1.

      (7)  OJ L 105, 13.4.2006, p. 1.

      (8)  OJ L 149, 5.7.1971, p. 2.

      (9)  OJ L 124, 20.5.2003, p. 1.

      (10)  OJ L 255, 30.9.2005, p. 22.

      (11)  OJ L 16, 23.1.2004, p. 44.

      (12)  OJ L 251, 3.10.2003, p. 12.

      (13)  OJ L 199, 31.7.2007, p. 23.

      (14)  OJ C 321, 31.12.2003, p. 1.

      (15)  OJ L 304, 30.9.2004, p. 12.

      (16)  OJ L 158, 30.4.2004, p. 77, as corrected by OJ L 229, 29.6.2004, p. 35.

      (17)  OJ L 18, 21.1.1997, p. 1.


Avis juridique important

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31997L0009

Directive 97/9/EC of the European Parliament and of the Council of 3 March 1997 on investor-compensation schemes

Official Journal L 084 , 26/03/1997 P. 0022 - 0031

DIRECTIVE 97/9/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 3 March 1997 on investor-compensation schemesTHE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,Having regard to the Treaty establishing the European Community, and in particular Article 57 (2) thereof,Having regard to the proposal from the Commission (1),Having regard to the opinion of the Economic and Social Committee (2),Having regard to the opinion of the European Monetary Institute (3),Acting in accordance with the procedure laid down in Article 189b of the Treaty (4) in the light of the joint text approved by the Conciliation Committee on 18 December 1996,(1) Whereas on 10 May 1993 the Council adopted Directive 93/22/EEC on investment services in the securities field (5); whereas that Directive is an essential instrument for the achievement of the internal market for investment firms;(2) Whereas Directive 93/22/EEC lays down prudential rules which investment firms must observe at all times, including rules the purpose of which is to protect as far as possible investor's rights in respect of money or instruments belonging to them;(3) Whereas, however, no system of supervision can provide complete protection, particularly where acts of fraud are committed;(4) Whereas the protection of investors and the maintenance of confidence in the financial system are an important aspect of the completion and proper functioning of the internal market in this area; whereas to that end it is therefore essential that each Member State should have an investor-compensation scheme that guarantees a harmonized minimum level of protection at least for the small investor in the event of an investment firm being unable to meet its obligations to its investor clients;(5) Whereas small investors will therefore be able to purchase investment services from branches of Community investment firms or on the basis of the cross-border provision of services as confidently as from domestic investment firms, in the knowledge that a harmonized minimum level of protection would be available to them in the event of an investment firm being unable to meet its obligations to its investor clients;(6) Whereas, in the absence of such minimum harmonization, a host Member State might consider itself justified, by considerations of investor protection, in requiring membership of its compensation scheme when a Community investment firm operating through a branch or under the freedom to provide services either belonged to no investor-compensation scheme in its home Member State or belonged to a scheme which was not regarded as offering equivalent protection; whereas such a requirement might prejudice the operation of the internal market;(7) Whereas although most Member States currently have some investor-compensation arrangements those arrangements do not in general cover all investment firms that hold the single authorization provided for in Directive 93/22/EEC;(8) Whereas, therefore, every Member State should be required to have an investor-compensation scheme or schemes to which every such investment firm would belong; whereas each scheme must cover money and instruments held by an investment firm in connection with an investor's investment operations which, where an investment firm is unable to meet its obligations to its investor clients, cannot be returned to the investor; whereas this is entirely without prejudice to the rules and procedures applicable in each Member State as regards the decisions to be taken in the event of the insolvency or winding-up of an investment firm;(9) Whereas the definition of investment firm includes credit institutions which are authorized to provide investment services; whereas every such credit institution must also be required to belong to an investor-compensation scheme to cover its investment business; whereas, however, it is not necessary to require such a credit institution to belong to two separate schemes where a single scheme meets the requirements both of this Directive and of Directive 94/19/EC of the European Parliament and of the Council of 30 May 1994 on deposit-guarantee schemes (6); whereas, however, in the case of investment firms which are credit institutions it may in certain cases be difficult to distinguish between deposits covered by Directive 94/19/EC and money held in connection with investment business; whereas Member States should be allowed to determine which Directive shall apply to such claims;(10) Whereas Directive 94/19/EC allows a Member State to exempt a credit institution from the obligation to belong to a deposit-guarantee scheme where that credit institution belongs to a system which protects the credit institution itself and, in particular, ensures its solvency; whereas, where a credit institution belonging to such a system is also an investment firm, a Member State should also be allowed, subject to certain conditions, to exempt it from the obligation to belong to an investor-compensation scheme;(11) Whereas a harmonized minimum level of compensation of ECU 20 000 for each investor should be sufficient to protect the interests of the small investor where an investment firm is unable to meet its obligations to its investor clients; whereas it would therefore appear reasonable to set the harmonized minimum level of compensation at ECU 20 000; whereas, as in Directive 94/19/EC, limited transitional provisions might be required to enable compensation schemes to comply with that figure since this applies equally to Member States which, when this Directive is adopted, do not have any such scheme;(12) Whereas the same figure was adopted in Directive 94/19/EC;(13) Whereas in order to encourage investors to take due care in their choice of investment firms it is reasonable to allow Member States to require investors to bear a proportion of any loss; whereas, however, an investor must be covered for at least 90 % of any loss as long as the compensation paid is less than the Community minimum;(14) Whereas certain Member States' schemes offer levels of cover higher than the harmonized minimum level of protection under this Directive; whereas, however, it does not seem desirable to require any change in those schemes in that respect;(15) Whereas the retention in the Community of schemes providing levels of cover higher than the harmonized minimum may, within the same territory, lead to disparities in compensation and unequal conditions of competition between national investment firms and branches of firms from other Member States; whereas, in order to counteract those disadvantages, branches should be authorized to join their host countries' schemes so that they may offer their investors the same cover as is provided by the schemes of the countries in which they are located; whereas it is appropriate that, in its report on the application of this Directive, the Commission should indicate the extent to which branches have exercised that option and any difficulties which they or the investor-compensation schemes may have encountered in implementing those provisions; whereas the possibility that home Member States' schemes should themselves offer such supplementary cover, subject to the conditions such schemes may lay down, is not ruled out;(16) Whereas market disturbances could be caused by branches of investment firms established in Member States other than their Member States of origin which offer levels of cover higher than those offered by investment firms authorized in their host Member States; whereas it is not appropriate that the level or scope of cover offered by compensation schemes should become an instrument of competition; whereas it is therefore necessary, at least during an initial period, to stipulate that neither the level nor the scope of cover offered by a home Member State's scheme to investors at branches located in another Member State should exceed the maximum level or scope offered by the corresponding scheme in the host Member State; whereas any market disturbances should be reviewed at an early date, on the basis of the experience acquired and in the light of developments in the financial sector;(17) Whereas a Member State must be able to exclude certain categories of specifically listed investments or investors, if it does not consider that they need special protection, from the cover afforded by investor-compensation schemes;(18) Whereas some Member States have investor-compensation schemes under the responsibility of professional organizations; whereas in other Member States there are schemes that have been set up and are regulated on a statutory basis; whereas that diversity of status poses a problem only with regard to compulsory membership of and exclusion from schemes; whereas it is therefore necessary to take steps to limit the powers of schemes in that area;(19) Whereas the investor must be compensated without excessive delay once the validity of his claim has been established; whereas the compensation scheme itself must be able to fix a reasonable period for the presentation of claims; whereas, however, the fact that such a period has expired may not be invoked against an investor who for good reason has not been able to present his claim within the time allowed;(20) Whereas informing investors of compensation arrangements is an essential element of investor protection; whereas Article 12 of Directive 93/22/EEC required investment firms to inform investors, before doing business with them, of the possible application of a compensation scheme; whereas, therefore, this Directive should lay down rules on informing such intending investors regarding the compensation schemes covering their investment business;(21) Whereas, however, the unregulated use in advertising of references to the amount and scope of a compensation scheme could affect the stability of the financial system or investor confidence; whereas Member States should therefore lay down rules to limit such references;(22) Whereas in principle this Directive requires every investment firm to join an investor-compensation scheme; whereas the Directives governing the admission of any investment firm the head office of which is in a non-member country, and in particular Directive 93/22/EEC, allow Member States to decide whether and subject to what conditions to permit branches of such investment firms to operate within their territories; whereas such branches will not enjoy the freedom to provide services under the second paragraph of Article 59 of the Treaty, or the right of establishment in Member States other than those in which they are established; whereas, accordingly, a Member State admitting such branches must decide how to apply the principles of this Directive to such branches in accordance with Article 5 of Directive 93/22/EEC and with the need to protect investors and maintain the integrity of the financial system; whereas it is essential that investors at such branches should be fully aware of the compensation arrangements applicable to them;(23) Whereas it is not indispensable in this Directive to harmonize the ways in which investor-compensation schemes are to be financed given, on the one hand, that the cost of financing such schemes must, in principle, be borne by investment firms themselves and, on the other hand, that the financing capacities of such schemes must be in proportion to their liabilities; whereas that must not, however, jeopardize the stability of the financial system of the Member State concerned;(24) Whereas this Directive may not result in the Member States or their competent authorities being made liable in respect of investors if they have ensured that one or more schemes for the compensation or protection of investors under the conditions prescribed in this Directive have been introduced and officially recognized;(25) Whereas, in conclusion, a minimum degree of harmonization of investor-compensation arrangements is necessary for the completion of the internal market for investment firms since it will make it possible for investors to do business with such firms with greater confidence, especially firms from other Member States, and make it possible to avoid any difficulties caused by host Member States applying national investor-protection rules that are not coordinated at Community level; whereas a binding Community Directive is the only appropriate instrument for the achievement of the desired objective in the general absence of investor-compensation arrangements corresponding to the coverage of Directive 93/22/EEC; whereas this Directive effects only the minimum harmonization required, allows Member States to prescribe wider or higher coverage if they desire and gives Member States the necessary latitude as regards the organization and financing of investor-compensation schemes,HAVE ADOPTED THIS DIRECTIVE:Article 1 For the purposes of this Directive:1. 'investment firm` shall mean an investment firm as defined in Article 1 (2) of Directive 93/22/EEC- authorized in accordance with Article 3 of Directive 93/22/EEC,or- authorized as a credit institution in accordance with Council Directive 77/780/EEC (7) and Council Directive 89/646/EEC (8), the authorization of which covers one or more of the investment services listed in Section A of the Annex to Directive 93/22/EEC;2. 'investment business` shall mean any investment service as defined in Article 1 (1) of Directive 93/22/EEC and the service referred to in point 1 of Section C of the Annex to that Directive,3. 'instruments` shall mean the instruments listed in Section B of the Annex to Directive 93/22/EEC;4. 'investor` shall mean any person who has entrusted money or instruments to an investment firm in connection with investment business;5. 'branch` shall mean a place of business which is a part of an investment firm, which has no legal personality and which provides investment services for which the investment firm has been authorized; all the places of business set up in the same Member State by an investment firm with headquarters in another Member State shall be regarded as a single branch;6. 'joint investment business` shall mean investment business carried out for the account of two or more persons or over which two or more persons have rights that may be exercised by means of the signature of one or more of those persons;7. 'competent authorities` shall mean the authorities defined in Article 22 of Directive 93/22/EEC; those authorities may, if appropriate, be those defined in Article 1 of Council Directive 92/30/EEC of 6 April 1992 on the supervision of credit institutions on a consolidated basis (9).Article 2 1. Each Member State shall ensure that within its territory one or more investor-compensation schemes are introduced and officially recognized. Except in the circumstances envisaged in the second subparagraph and in Article 5 (3), no investment firm authorized in that Member State may carry on investment business unless it belongs to such a scheme.A Member State may, however, exempt a credit institution to which this Directive applies from the obligation to belong to an investor-compensation scheme where that credit institution is already exempt under Article 3 (1) of Directive 94/19/EC from the obligation to belong to a desposit-guarantee scheme, provided that the protection and information given to depositors are also given to investors on the same terms and investors thus enjoy protection at least equivalent to that afforded by an investor-compensation scheme.Any Member State that avails itself of that option shall inform the Commission accordingly; it shall, in particular, disclose the characteristics of the protective systems in question and the credit institutions covered by them for the purposes of this Directive, as well as any subsequent changes to the information supplied. The Commission shall inform the Council thereof.2. A scheme shall provide cover for investors in accordance with Article 4 where either:- the competent authorities have determined that in their view an instrument firm appears, for the time being, for reasons directly related to its financial circumstances, to be unable to meet its obligations arising out of investors' claims and has no early prospect of being able to do so,or- a judicial authority has made a ruling, for reasons directly related to an investment firm's financial circumstances, which has the effect of suspending investors' ability to make claims against it,whichever is the earlier.Cover shall be provided for claims arising out of an investment firm's inability to:- repay money owed to or belonging to investors and held on their behalf in connection with investment business,or- return to investors any instruments belonging to them and held, administered or managed on their behalf in connection with investment business,in accordance with the legal and contractual conditions applicable.3. Any claim under paragraph 2 on a credit institution which, in a given Member State, would be subject both to this Directive and to Directive 94/19/EC shall be directed by that Member State to a scheme under one or other of those Directives as that Member State shall consider appropriate. No claim shall be eligible for compensation more than once under those Directives.4. The amount of an investor's claim shall be calculated in accordance with the legal and contractual conditions, in particular those concerning set off and counterclaims, that are applicable to the assessment, on the date of the determination or ruling referred to in paragraph 2, of the amount of the money or the value, determined where possible by reference to the market value, of the instruments belonging to the investor which the investment firm is unable to repay or return.Article 3 Claims arising out of transactions in connection with which a criminal conviction has been obtained for money laundering, as defined in Article 1 of Council Directive 91/308/EEC of 10 June 1991 on prevention of the use of the financial system for the purpose of money laundering (10), shall be excluded from any compensation under investor-compensation schemes.Article 4 1. Member States shall ensure that schemes provide for cover of not less than ECU 20 000 for each investor in respect of the claims referred to in Article 2 (2).Until 31 December 1999 Member States in which, when this Directive is adopted, cover is less than ECU 20 000 may retain that lower level of cover, provided it is not less than ECU 15 000. That option shall also be available to Member States to which the transitional provisions of the second subparagraph of Article 7 (1) of Directive 94/19/EC apply.2. A Member State may provide that certain investors shall be excluded from cover by schemes or shall be granted a lower level of cover. Those exclusions shall be as listed in Annex I.3. This Article shall not preclude the retention or adoption of provisions which afford greater or more comprehensive cover to investors.4. A Member State may limit the cover provided for in paragraph 1 or that referred to in paragraph 3 to a specified percentage of an investor's claim. The percentage covered must, however, be equal to or exceed 90 % of the claim as long as the amount to be paid under the scheme is less than ECU 20 000.Article 5 1. If an investment firm required by Article 2 (1) to belong to a scheme does not meet the obligations incumbent on it as a member of that scheme, the competent authorities which issued its authorization shall be notified and, in cooperation with the compensation scheme, shall take all measures appropriate, including the imposition of penalties, to ensure that the investment firm meets its obligations.2. If those measures fail to secure compliance on the part of the investment firm, the scheme may, where national law permits the exclusion of a member, with the express consent of the competent authorities, give not less than 12 months' notice of its intention of excluding the investment firm from membership of the scheme. The scheme shall continue to provide cover under the second subparagraph of Article 2 (2) in respect of investment business transacted during that period. If, on expiry of the period of notice, the investment firm has not met its obligations, the compensation scheme may, again having obtained the express consent of the competent authorities, exclude it.3. Where national law permits, and with the express consent of the competent authorities which issued its authorization, an investment firm excluded from an investor-compensation scheme may continue to provide investment services if, before its exclusion, it made alternative compensation arrangements which ensure that investors will enjoy cover that is at least equivalent to that offered by the officially recognized scheme and has characteristics equivalent to those of that scheme.4. If an investment firm the exclusion of which is proposed under paragraph 2 is unable to make alternative arrangements which comply with the conditions imposed in paragraph 3, the competent authorities which issued its authorization shall withdraw it forthwith.Article 6 After the withdrawal of an investment firm's authorization, cover under the second subparagraph of Article 2 (2) shall continue to be provided in respect of investment business transacted up to the time of that withdrawal.Article 7 1. Investor-compensation schemes introduced and officially recognized in a Member State in accordance with Article 2 (1) shall also cover investors at branches set up by investment firms in other Member States.Until 31 December 1999, neither the level nor the scope, including the percentage, of the cover provided for may exceed the maximum level or scope of the cover offered by the corresponding compensation scheme within the territory of the host Member State. Before that date the Commission shall draw up a report on the basis of the experience acquired in applying this subparagraph and Article 4 (1) of Directive 94/19/EC referred to above and shall consider the need to continue those provisions. If appropriate, the Commission shall submit a proposal for a Directive to the European Parliament and the Council, with a view to the extension of their validity.Where the level or scope, including the percentage, of the cover offered by the host Member State's investor-compensation scheme exceeds the level or scope of the cover provided in the Member State in which an investment firm is authorized, the host Member State shall ensure that there is an officially recognized scheme within its territory which a branch may join voluntarily in order to supplement the cover which its investors already enjoy by virtue of its membership of its home Member State's scheme.If a branch joins such a scheme, that scheme shall be one that covers the category of institution to which the branch belongs or most closely corresponds in its host Member State.Member States shall ensure that objective and generally applied conditions are established concerning branches' membership of all investor-compensation schemes. Admission shall be conditional on a branch meeting the relevant membership obligations, including in particular the payment of all contributions and other charges. Member States shall follow the guiding principles set out in Annex II in implementing this paragraph.2. If a branch which has exercised the option of voluntary membership under paragraph 1 does not meet the obligations incumbent on it as a member of an investor-compensation scheme, the competent authorities which issued its authorization shall be notified and, in cooperation with the compensation scheme, shall take all measures necessary to ensure that the branch meets the aforementioned obligations.If those measures fail to ensure that the branch meets the obligations referred to in this Article, after an appropriate period of notice of not less than 12 months the compensation scheme may, with the consent of the competent authorities which issued the authorization, exclude the branch. Investment business transacted before the date of exclusion shall continue to be covered after that date by the compensation scheme of which the branch was a voluntary member. Investors shall be informed of the withdrawal of the supplementary cover and of the date on which it takes effect.Article 8 1. The cover provided for in Article 4 (1), (3) and (4) shall apply to the investor's aggregate claim on the same investment firm under this Directive irrespective of the number of accounts, the currency and location within the Community.Member States may, however, provide that funds in currencies other than those of the Member States and the ecu shall be excluded from cover or be subject to lower cover. This option shall not apply to instruments.2. Each investor's share in joint investment business shall be taken into account in calculating the cover provided for in Article 4 (1), (3) and (4).In the absence of special provisions, claims shall be divided equally amongst investors.Member States may provide that claims relating to joint investment business to which two or more persons are entitled as members of a business partnership, association or grouping of a similar nature which has no legal personality may, for the purpose of calculating the limits provided for in Article 4 (1), (3) and (4), be aggregated and treated as if arising from an investment made by a single investor.3. Where an investor is not absolutely entitled to the sums or securities held, the person who is absolutely entitled shall receive the compensation, provided that that person has been or can be identified before the date of the determination or ruling referred to in Article 2 (2).If two or more persons are absolutely entitled, the share of each under the arrangements subject to which the sums or the securities are managed shall be taken into account when the limits laid down in Article 4 (1), (3) and (4) are calculated.This provision shall not apply to collective-investment undertakings.Article 9 1. The compensation scheme shall take appropriate measures to inform investors of the determination or ruling referred to in Article 2 (2) and, if they are to be compensated, to compensate them as soon as possible. It may fix a period during which investors shall be required to submit their claims. That period may not be less than five months from the date of the aforementioned determination or ruling or from the date on which that determination or ruling is made public.The fact that that period has expired may not, however, be invoked by the scheme to deny cover to an investor who has been unable to assert his right to compensation in time.2. The scheme shall be in a position to pay an investor's claim as soon as possible and at the latest within three months of the establishment of the eligibility and the amount of the claim.In wholly exceptional circumstances and in special cases a compensation scheme may apply to the competent authorities for an extension of the time limit. No such extension may exceed three months.3. Notwithstanding the time limit laid down in paragraph 2, where an investor or any other person entitled to or having an interest in investment business has been charged with an offence arising out of or in relation to money laundering as defined in Article 1 of Directive 91/308/EEC, the compensation scheme may suspend any payment pending the judgment of the court.Article 10 1. Member States shall ensure that each investment firm takes appropriate measures to make available to actual and intending investors the information necessary for the identification of the investor-compensation scheme of which the investment firm and its branches within the Community are members or any alternative arrangement provided for under the second subparagraph of Article 2 (1) or Article 5 (3). Investors shall be informed of the provisions of the investor-compensation scheme or any alternative arrangement applicable, including the amount and scope of the cover offered by the compensation scheme and any rules laid down by the Member States pursuant to Article 2 (3). That information shall be made available in a readily comprehensible manner.Information shall also be given on request concerning the conditions governing compensation and the formalities which must be completed to obtain compensation.2. The information provided for in paragraph 1 shall be made available in the manner prescribed by national law in the official language or languages of the Member State in which a branch is established.3. Member States shall establish rules limiting the use in advertising of the information referred to in paragraph 1 in order to prevent such use from affecting the stability of the financial system or investor confidence. In particular, a Member State may restrict such advertising to a factual reference to the scheme to which an investment firm belongs.Article 11 1. Each Member State shall check whether branches established by an investment firm the head office of which is outwith the Community have cover equivalent to that prescribed in this Directive. Failing such cover, a Member State may, subject to Article 5 of Directive 93/22/EEC, stipulate that branches established by an investment firm the head office of which is outwith the Community shall join investor-compensation schemes in operation within its territory.2. Actual and intending investors at branches established by an investment firm the head office of which is outwith the Community shall be provided by that investment firm with all relevant information concerning the compensation arrangements which cover their investments.3. The information provided for in paragraph 2 shall be made available in the manner prescribed by national law in the official language or languages of the Member State in which a branch is established and shall be drafted in a clear and comprehensible form.Article 12 Without prejudice to any other rights which they may have under national law, schemes which make payments in order to compensate investors shall have the right of subrogation to the rights of those investors in liquidation proceedings for amounts equal to their payments.Article 13 Member States shall ensure that an investor's right to compensation may be the subject of an action by the investor against the compensation scheme.Article 14 No later than 31 December 1999 the Commission shall submit a report to the European Parliament and to the Council on the application of this Directive together, where appropriate, with proposals for its revision.Article 15 1. The Member States shall bring into force the laws, regulations and administrative provisions necessary for them to comply with this Directive no later than 26 September 1998. They shall forthwith inform the Commission thereof.When the Member States adopt those measures, they shall contain references to this Directive or shall be accompanied by such references on the occasion of their official publication. The methods of making such references shall be laid down by the Member States.2. The Member States shall communicate to the Commission the texts of the main provisions of national law which they adopt in the field covered by this Directive.Article 16 Article 12 of Directive 93/22/EEC shall be repealed with effect from the date referred to in Article 15 (1).Article 17 This Directive shall enter into force on the day of its publication in the Official Journal of the European Communities.Article 18 This Directive is addressed to the Member States.Done at Brussels, 3 March 1997.For the European ParliamentThe PresidentJ. M. GIL-ROBLESFor the CouncilThe PresidentM. DE BOER(1) OJ No C 321, 27. 11. 1993, p. 15 and OJ No C 382, 31. 12. 1994, p. 27.(2) OJ No C 127, 7. 5. 1994, p. 1.(3) Opinion delivered on 28 July 1995.(4) European Parliament opinion of 19 April 1994 (OJ No C 128, 9. 5. 1994, p. 85), Council common position of 23 October 1995 (OJ No C 320, 30. 11. 1995, p. 9) and European Parliament Decision of 12 March 1996 (OJ No C 96, 1. 4. 1996, p. 28). Decision of the Council of 17 February 1997 and Decision of the European Parliament of 19 February 1997 (OJ No C 85, 17. 3. 1997).(5) OJ No L 141, 11. 6. 1993, p. 27.(6) OJ No L 135, 31. 5. 1994, p. 5.(7) First Council Directive 77/780/EEC of 12 December 1977 on the coordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the business of credit institutions (OJ No L 322, 17. 12. 1977, p. 30). Directive as last amended by Directive 89/646/EEC (OJ No L 386, 30. 12. 1989, p. 1).(8) Second Council Directive 89/646/EEC of 15 December 1989 on the coordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the business of credit institutions and amending Directive 77/780/EEC (OJ No L 386, 30. 12. 1989, p. 1). Directive as last amended by Directive 92/30/EEC (OJ No L 110, 28. 4. 1992, p. 52).(9) OJ No L 110, 28. 4. 1992, p. 52.(10) OJ No L 166, 28. 6. 1991, p. 77.ANNEX I LIST OF EXCLUSIONS REFERRED TO IN ARTICLE 4 (2) 1. Professional and institutional investors, including:- investment firms as defined in Article 1 (2) of Directive 93/22/EEC,- credit institutions as defined in the first indent of Article 1 of Council Directive 77/780/EEC,- financial institutions as defined in Article 1 (6) of Council Directive 89/646/EEC,- insurance undertakings,- collective-investment undertakings,- pension and retirement funds.Other professional and institutional investors.2. Supranational institutions, government and central administrative authorities.3. Provincial, regional, local and municipal authorities.4. Directors, managers and personally liable members of investment firms, persons holding 5 % or more of the capital of such investment firms, persons responsible for carrying out the statutory audits of investment firms' accounting documents and investors with similar status in other firms within the same group as such a firm.5. Close relatives and third parties acting on behalf of the investors referred to in point 4.6. Other firms in the same group.7. Investors who have any responsibility for or have taken advantage of certain facts relating to an investment firm which gave rise to the firm's financial difficulties or contributed to the deterioration of its financial situation.8. Companies which are of such a size that they are not permitted to draw up abridged balance sheets under Article 11 of the Fourth Council Directive 78/660/EEC of 25 July 1978 based on Article 54 (3) (g) of the Treaty on the annual accounts of certain types of companies (1).(1) OJ No L 222, 14. 8. 1978, p. 11. Directive as last amended by Directive 94/8/EC (OJ No L 82, 25. 3. 1994, p. 33).ANNEX II GUIDING PRINCIPLES (referred to in the fifth subparagraph of Article 7 (1)) Where a branch applies to join a host Member State's scheme for supplementary cover, the host Member State's scheme will bilaterally establish with the home Member State's scheme appropriate rules and procedures for the payment of compensation to investors at that branch. The following principles will apply both to the drawing up of those procedures and in the framing of the membership conditions applicable to that branch (as referred to in Article 7 (1)):(a) the host Member State's scheme will retain full rights to impose its objective and generally applied rules on participating investment firms; it will be able to require the provision of relevant information and be entitled to verify such information with the home Member State's competent authorities;(b) the host Member State's scheme will meet claims for supplementary compensation after it has been informed by the home Member State's competent authorities of the determination or ruling referred to in Article 2 (2). The host Member State's scheme will retain full rights to verify an investor's entitlement according to its own standards and procedures before paying supplementary compensation;(c) the host Member State's and the home Member State's schemes will cooperate fully with each other to ensure that investors receive compensation promptly and in the correct amounts. In particular, they will agree on how the existence of a counterclaim which may give rise to set-off under either scheme will affect the compensation paid to the investor by each scheme;(d) the host Member State's scheme will be entitled to charge branches for supplementary cover on an appropriate basis which takes into account the cover funded by the home Member State's scheme. To facilitate charging, the host Member State's scheme will be entitled to assume that its liability will in all circumstances be limited to the excess of the cover it has offered over the cover offered by the home Member State regardless of whether the home Member State actually pays any compensation in respect of claims by investors within the host Member State's territory.