Brussels, 19/06/2015 (Agence Europe) - Some 76 European building sector trade unions launched a campaign, Stop Letterbox Companies, across 34 European countries on Tuesday 16 June. The campaign targets so-called letterbox companies, which have no real economic activities but are set up in a country to take advantage of favourable tax or social legislation. The unions are calling for a review of the services directive (2006/123/EC), and the implementation of a European registration system for all companies and for each worker in the EU to have a single European social security number. Lastly, they are calling for the draft directive on single member private limited liability companies.
The European Federation of Building and Woodworkers (EFBWW) says that letterbox companies are increasingly being used as a way of avoiding paying social security contributions and dodging collective agreements. “More and more often, unscrupulous people and organisations are setting up fake companies in countries where social security contributions are low and where there are no checks on companies' economic activities or social security payments”, it says, indicating that these countries include Ireland, the UK, Cyprus, Estonia, Bulgaria and Slovenia.
“Since the issue of letterbox companies was basically caused by a poor EU policy, the problem needs to be solved at EU level”, argues the EFBWW.
Among its many proposals, the EFBWW urges European lawmakers to: - insert an enforceable “anti-abuse social clause” in the social security Regulation n° 883/2004; - introduce an unconditional system of chain liability making the main contractor liable for the social abuses and fraud committed by any of the subcontractors; - impose the mandatory use of the Electronic Exchange of Social Security Information (EESSI) by the end of 2016; - revise the services directive; - set up a transparent and accessible business register of all EU-companies; - withdraw the European draft directive of 9 April 2014 (single member limited liability).
The long-running single market issue of letterbox companies (see EUROPE 7970) resurfaces regularly in public debates at both national and European levels. Last year, the topic was keenly debated in the context of the talks on the implementing directive on the posting of workers (see EUROPE 10943).
The draft legislation currently under discussion on new status for single member companies (see EUROPE 11322) is the cause of some disquiet among trade unions and some member states. They argue that, by allowing online registration and accepting minimum capital of €1, the directive could encourage the creation of letterbox companies. (Pascal Hansens)