1. Introduction
The Hakamp judgment (C-203/24) of 4 September 2025 contains the response of the Court of Justice of the European Union (CJEU) to a preliminary ruling referred by the Supreme Court of the Netherlands.
It follows from Article 13(1) of Regulation (EC) No 883/2004 that, for workers who are employed in more than one Member State, the social security system of the Member State where the workers have their residence will apply if the workers perform a substantial part of the work in this Member State.
Article 14(8) of Regulation (EC) No 987/2009 seeks to further clarify this and stipulates that “a substantial part” should be considered as a share of 25% or in terms of working time and remuneration. This is the famous 25% rule. Until recently, however, it was unclear what (and if) additional factors, on top of working time or remuneration, might play a role in assessing this concept.
The above regulations were designed to ensure that employers and workers would not have to pay contributions in different member states. This would, after all, undermine the free movement of persons.
The preliminary ruling provides an answer to the question of what is meant by the concept of “substantial part of the activities” and whether criteria other than remuneration and working hours can be taken into account when designating a social security system.
2. Facts of the case
KN lived in the Netherlands in 2016. Between 4 February and 31 December 2016, he worked as a skipper on an inland vessel registered in the Netherlands. A shipping company registered and based in the Netherlands owned and operated the vessel. KN carried out work in Belgium, Germany and the Netherlands. According to the vessel's logbook, in 2016 it sailed approximately 22% of its total sailing time in the Netherlands. During the period in question, KN was on the payroll of an employer in Liechtenstein.
The case concerns KN’s challenge against the Sociale Verzekeringsbank (Social Security Bank - SVB), which in 2019 designated Dutch legislation as applicable to his employment situation. The SVB reasoned that KN carried out a substantial part of his work in the Netherlands, considering his residence, the ship’s registration, and its Dutch ownership and operation. KN’s appeal was also dismissed, with the Dutch court ruling that less than 25% of work in a Member State can still count as substantial if supported by other indicators. KN then appealed in cassation to the Dutch Supreme Court (Hoge Raad), arguing that the lower courts wrongly applied EU Regulations 883/2004 and 987/2009 by relying on irrelevant factors and by ignoring that his employer was based in Liechtenstein and that the ship’s operations were linked to Belgium rather than the Netherlands.
3. Questions referred for a preliminary ruling
In the context of the above circumstances, the referring court wonders which circumstances or types of circumstances are appropriate for the assessment of whether a person performs a substantial part of his work in the Member State of residence in a case where it is established that he performs work there for 22 per cent of his working time. In this regards, it asks whether a circumstance must:
directly relate to the work itself,
indicate where the work is carried out, and
allow for measuring how much of the person’s total work was done in their country of residence.
Furthermore, the referring court wonders whether account may be taken of:
the place of residence of the employee,
the place of registration of the inland waterway vessel on which the employee performs his work,
the place of establishment of the owner and operator of the inland waterway vessel,
the place where the vessel sailed during other periods when the employee was not working on it and was not yet employed by the employer
the place of establishment of the employer, and
the place where the employee embarks and disembarks from the vessel.
Finally, the referring court wonders which period should be used to assess whether an employee performs a substantial part of his work in his country of residence and whether the competent institution of a Member State has discretion in determining the applicable legislation with regard to the concept of “substantial part of his work”.
4. Assessment by the CJEU
The Court first notes that the referring court's doubts arise from the wording of the Dutch version of Article 14(8) of Regulation No. 987/2009. This version uses the term “mede” (also), which could imply that the Regulation merely provides indicative criteria (working time and remuneration) that are not exhaustive. In other words, other criteria could also be taken into account in this case. The Court notes that various other language versions of the Regulation do not contain the word “also”. Furthermore, a single provision from a specific language version cannot serve as a the formal interpretation, as this would be contrary to the mandatory uniform application of EU law. The general structure and objective of the Regulation, of which the provision forms part must always be taken into account.
In the light of the objectives of the aforementioned regulations, Article 14(8) of Regulation No 987/2009 must be interpreted as referring to working time and/or remuneration in order to determine whether a quantitatively substantial part of all the employee's work is performed in a Member State. Paragraph 8 expressly refers to ‘the above criteria’, i.e. remuneration and working time, to the exclusion of any other criterion. The fact that this assessment of the criteria mentioned is carried out in the context of a general assessment of the situation of the employee concerned does not mean that other criteria may be added, but that all the activities carried out by that employee in paid employment must be taken into account.
The Court therefore considers that if it were accepted that an employee who has performed less than 25% of his total salaried work in the territory of the Member State in which he resides could be subject to the legislation of that State, this would create uncertainty in the application of the conflict rules. It must therefore always be verified whether the threshold of 25% is reached on the basis of working time and/or remuneration, without taking other criteria into account.
As regards the question of the period to be taken into account, the Court considers that Article 14(10) Regulation No 987/2009 provides that the institutions concerned must take into account the situation expected in the following 12 calendar months. According to the Court, it is clear from the wording of that provision that it refers to the following twelve months, since no provision of that regulation refers to the past situation of the worker concerned. Since Article 14(8) and (10) of that regulation apply only in cases where a worker is employed in two or more Member States, the Court considers that it must be established that that period begins when the worker starts working in two or more Member States.
5. Key Findings
In conclusion, the CJEU in Hakamp provided much-needed clarity on how to determine the applicable social security legislation for migrant workers employed in multiple Member States.
The Court held that the decisive criterion is whether at least 25% of the work, assessed in terms of working time or remuneration, is carried out in the worker’s country of residence. Importantly, other factors such as the employee’s residence, the registration or operation of the vessel, the employer’s place of establishment, or the points of embarkation and disembarkation cannot compensate if this threshold is not met. By setting out this strict and quantifiable rule, the Court rejected broader interpretations that could have led to inconsistent applications across Member States. This approach reinforces legal certainty, prevents overlapping obligations, and ensures that the coordination of social security systems operates in line with the principle of free movement of workers, which remains a cornerstone of EU law.
The Court furthermore concluded that the relevant reference period is the 12 months following the start of employment in two or more Member States, and that only the expected future situation, not the past, should be taken into account.
Source:CJEU 4 September 2025, C-203/24, ECLI:EU:C:2025:662, ‘Hakamp’