You may have heard that the Belgian Overseas Social Security Office’s regime (“OSSO”) is up for some changes. After earlier study, the Belgian Government started in 2012 with the concrete analysis of possible changes to the scheme through the appointment of a special Government commissioner. This commissioner has recently finished his exploration and presented his report. Based on this, the OSSO has confirmed that the scheme will be reformed in 2015. The OSSO will change as to its organisation, but also content-wise.
What is OSSO (1)?
The OSSO-regime provides social protection to individuals who:
- are employed outside of the European Economic Area (“EEA”) and Switzerland; and
- are either an EEA or Swiss national or, regardless of their nationality, are employed by:
- the Belgian State, the Regions, the Communities; or
- a company with registered office in Belgium.
The employee (/ self-employed worker) as well as the employer, on the employee’s behalf, can affiliate to the regime on a voluntary basis. The amount of the monthly contributions can also be freely determined taking into account the legal minimum and maximum amount of contributions.
The regime consists of a general scheme which can be completed by one or more complementary insurance contracts. The general scheme includes pension insurance (old age as well as widower’s pension), sickness and invalidity insurance and, after 16 years of contribution payments, medical coverage. The complementary insurance contracts cover medical care, accidents at work and accidents in private life. Unemployment benefits and child allowances are not covered under the OSSO-regime.
Almost the entire population of OSSO-affiliates has the nationality of an EEA-state. Congo, China and the US are the states within which most OSSO-expats are employed.
The organisation and content of OSSO will change
Both the administrative organisation and the substantive conditions of the social protection for expats will change.
- Single point of contact
It has been confirmed that expats will still have a single point of contact under the future regime. In this way, it is ensured that the processing and follow-up of current files will encounter no difficulties.
- New institutional framework
SSO will be merged with the National Social Security Office of the Provincial and Local Governments (“RSZPPO”/”ONSSAPL”) (2) and will preserve its autonomy as a public institution serving expats.
- Preservation of acquired rights
OSSO confirms that, ‘at this stage’, social security rights which have been built up until now will be maintained.
- Substantial changes unknown
There has been no communication on how the future regime will look like. It is certain that the rights of non-EEA and non-Swiss nationals will change (see below). Earlier propositions have suggested the voluntarily affiliation with the statutory Belgian social security regime (RSZ/ONSS) and the qualifying condition of a prior insurance period under that latter regime. Such scenario already raised questions as to the personal scope and the EU-compatibility of the future regime. However, it has to be awaited which scenario will be produced as a follow-up to the Government commissioner’s report.
Our view on the upcoming reform
While the organisational reform is expected to have a limited impact for companies and their expats, this will probably turn out differently as regards the content of the protection and the possibility to affiliate.
Non-EEA and non-Swiss nationals who are employed by a company with registered seat outside of Belgium are no longer accepted to participate in the OSSO-regime, notwithstanding the fact that such affiliations were accepted in the past. This former rather liberal approach towards new affiliations was already put to an end in 2009. It is not excluded that the personal scope of the system will be narrowed down further for non-EEA and non-Swiss citizens.
With regard to the exact content of the future regime, we will have to wait for the concrete proposals for amendment. However, a further change in the affiliation policy can be expected. Moreover, it is highly probable that the new regime will be more expensive than the current scheme. Although the exact impact is still unknown, it is thus advisable to already prepare for the possible budgetary implications of sending employees abroad (worst case scenario: contributions equalling the RSZ/ONSS contributions). As the affiliation to OSSO will remain voluntary, the available alternatives are worth to be explored. Finally, it will be important to follow up whether grandfathering rules will be provided for people affiliated before the entry into force of the reform.
