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The reference has been made in proceedings between Mr Salemink, a Netherlands national who had worked on a gas-drilling platform on the continental shelf adjacent to the Netherlands and was resident in Spain, and the Raad van bestuur van het Uitvoeringsinstituut werknemersverzekeringen (Management Board of the Employee Insurance Agency), concerning its refusal to grant Mr Salemink invalidity benefit.

Mr Salemink, a Netherlands national has worked on a gas-drilling platform of the company Nederlandse Aardolie Maatschappij. The platform is located outside the Netherlands’ territorial waters, on the continental shelf adjacent to the Netherlands, approximately 80 km from its coast. He moved his residence to Spain. After his move, Mr Salemink no longer satisfied the residence condition laid down in Dutch legislation and, therefore, he was excluded from the compulsory insurance, in particular from insurance against incapacity for work. He failed to take out voluntary insurance. After reporting sick, Mr Salemink applied for a Dutch incapacity benefit. That application was refused by the Employee Insurance Agency on the ground that, on the date on which he had become incapacitated for work, he was not compulsorily insured. Since Mr Salemink had resided outside the Netherlands, it took the view that he was no longer compulsorily insured as from that date.

When the case reached the Amsterdam Court, it decided to stay the proceedings and to ask the Court of Justice whether the provisions of Regulation 1408/71 and Article 39 EC must be interpreted as precluding an employee, working on a fixed installation on the continental shelf adjacent to a Member State, from being in a position in which he is not compulsorily insured under national statutory employee insurance in that Member State solely on the ground that he is not resident there but in another Member State. In that connection, under Article 13(2)(a) of Regulation 1408/71, a person employed in the territory of one Member State is to be subject to the legislation of that State even if he resides in the territory of another Member State. However, the Netherlands Government and the UWV submitted that the territorial scope of Regulation 1408/71 is restricted to the national territory. The national court was also uncertain whether EU law is applicable to the continental shelf in question.

In that regard, the ECJ made reference to the rules and principles of international law relating to the legal regime applicable to the continental shelf. Citing the International Court of Justice and the provisions of the Convention on the Law of the Sea, the Court held that, since a Member State has sovereignty over the continental shelf adjacent to it, work carried out on fixed or floating installations positioned on the continental shelf, in the context of the prospecting and/or exploitation of natural resources, is to be regarded as work carried out in the territory of that State for the purposes of applying EU law. A Member State which takes advantage of the economic rights to prospect and/or exploit natural resources on that part of the continental shelf which is adjacent to it cannot avoid the application of the EU law provisions designed to ensure the freedom of movement of persons working on such installations.

Being established that EU law, and in particular Regulation 1408/71, is applicable to the continental shelf adjacent to a Member State, these provision could be applied to the situation of Mr Salemink. Article 13(2)(a) of Regulation 1408/71 expressly provides that a person employed in the territory of one Member State is to be subject to the legislation of that State ‘even if he resides in the territory of another Member State’. That provision would not be complied with if the residence condition laid down by the legislation of the Member State in whose territory the person is employed for affiliation to the compulsory insurance scheme which it establishes could be relied on against the persons referred to in Article 13(2)(a). With regard to those persons, the effect of that provision is to replace the residence condition with a condition based on employment in the territory of the Member State concerned.

Consequently, national legislation which lays down that it is the residence criterion which determines whether or not an employee working on a gas-drilling platform on the continental shelf adjacent to a Member State may benefit from compulsory insurance in that Member State is contrary to Article 13(2)(a) of Regulation 1408/71. Moreover, the option of taking out voluntary insurance open to Mr Salemink cannot invalidate that conclusion. The steps which non-resident workers wishing to take out voluntary insurance must take on their own initiative, and the constraints associated with such insurance, such as complying with time-limits for applying for insurance, are factors which place non-resident workers – who have the option only of voluntary insurance – in a less favourable position than resident workers, who are covered by compulsory insurance.