ENIM releases guidelines on French social security legislation

In early 2017, the French government published Decree no 2017-307, which cemented the government’s view on the social security affiliation of seafarers residing in France and working on non-French flagged vessels. The Decree provided that all crewmembers employed on foreign-flagged vessels deemed to be French residents are at risk of being subject to the French social security system for seafarers (ENIM). 

The legislation, which has been having a detrimental impact on the yachting industry in the South of France, was then amended to allow seafarers to register with other systems offering protection equivalent to, or greater than, that provided by the French system. While this amendment was a step forward, many felt the changes were not significant enough to lure yachts back to France and subsequently restore maritime trade to previous levels.

This week, however, ENIM has published guidelines on its website that offer a more favourable view on non-resident crew working on foreign-flagged vessels in France. In summary, the length of stay in France leading to the application of social security provisions has been clarified as six months. Furthermore, periods during which a vessel is present is in a shipyard, or undergoing any works that effectively 'immobilise' the vessel, are excluded. 

“It is welcome clarification on multiple grounds,” explains Jean-Philippe Maslin, senior associate at Ince & Co France. “Firstly, the very short period of three months that would determine a crewmember as French resident has been extended to six months over the last 12 months. This is a much more flexible time frame for yacht crew.” 

Industry associations including the ECPY, as well as various companies including La Ciotat Shipyards and other legal experts, have been actively involved in the negotiations with the French government. During the discussions leading to this update, the French authorities were informed that, for yachts wintering and undertaking refits in France, six months would still be too stringent and may well mean a continued negative impact on the industry. What is quite significant is that this update confirms a complete exemption from the social security obligations for non-resident crew on yachts undergoing refits in French shipyards, and on yachts that are 'immobilised', whatever the duration of the stay. 

Maslin points out, however, there is still the question of what qualifies a vessel as being 'immobilised', and whether this definition includes yachts undergoing minor maintenance work in French marinas. “The update doesn’t, for example, specifically address yachts that are simply wintering in French marinas, but we are hopeful that ENIM will have an open interpretation,” he adds. “Unfortunately, although we will do everything possible to have ENIM put in writing that yachts wintering in marinas would also count as vessels 'immobilised' for works, it is going to be difficult to obtain further clarification from the authorities."

Maslin adds that the update was perhaps a bit premature and would have benefitted from some further discussion and feedback from the maritime sector. “The update does, however, mean that we are close to having a definitive position on what this legislation actually means for yachts and crew in France,” he concludes. “It is not the added costs or added regulations that drives yachts away, it is the uncertainty. And this clarification is coming at a good point at the start of the summer season.”
 
While perhaps the best move for the yachting industry would be abolition of the legislation altogether, this would be unlikely at this stage. The update is, at least, welcome clarification of the finer points of the provisions, which look to be more flexible than originally thought.

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Ince

La Ciotat Shipyards

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