It comes hence as little surprise that, in the wake of the Covid-19 pandemic and the flexibilisation of work that came with it, the number of digital nomads, not only from third countries but also from the EU, has increased considerably. In light of these circumstances, Spain has lost no time in passing a regulatory framework to encourage the attraction of international talent to Spain and enable digital nomads to stay in our country.
Accordingly, on 21 December 2022, Spain adopted Law 28/2022 on the promotion of the start-up ecosystem, now known as the “Startup Law”. This law introduced a regulatory framework which allows for digital nomads from non-EU countries to obtain a residence and work permit, if they decide to work for their foreign employers remotely from Spain. The new regulation on international remote work was the topic of a previous article on our blog.
However, this regulation does not apply to digital nomads within the EU. Accordingly, a regulatory framework to organise such international remote work (or teleworking) within the EU clearly needed to be established.
Therefore, on 30 June 2023, Spain signed the “Framework Agreement concerning the application of Article 16(1) of Regulation (EC) No 883/2004 in cases of habitual cross-border teleworking” together with 17 other EU countries.
By virtue of the said Framework Agreement, as of 1 July 2023, cross-border remote workers may choose Spain as temporary residence and benefit, among other things, from the advantages of our climate. Provided that the remote work carried out in Spain accounts for less than 50% of the total working time, they may request to continue to be subject to the social security regulations in the place of business of the company employing them, by virtue of art. 16.1 of Regulation 883/2004. Under this regime, they would continue to pay social security contributions in the EU country where the registered offices of their employer are located. However, the said country must be a signatory state to the Framework Agreement, a pre-condition which, as things stand today, neither the United Kingdom nor the Republic of Ireland meets.
Nevertheless, if an EU citizen wanted to settle permanently in Spain to work remotely for his or her foreign employer, he or she would not be able to invoke the aforementioned regulation. For this reason, in such cases, both the company and the worker should first carry out the necessary steps to formalise a contract in accordance with Spanish law.