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EU Takes UK to Court for Lack of Migrant Benefits

Passengers at Heathrow
Suzanne Plunkett | Bloomberg | Getty Images
Passengers at Heathrow

The European Commission has referred the U.K. to the EU's Court of Justice for not allowing citizens of the Union residing in the U.K. to receive social security benefits which they are entitled to under EU law.

The Commission says that the U.K. fails to apply the "habitual residence" test to EU nationals residing in the country, instead applying "right to reside" to the individuals, thus allowing the U.K. to avoid paying specific entitlements, like child benefit.

The law in question was unanimously reaffirmed by EU member states in 2009 as part of an update to the EU's rules on social security coordination. Individuals who have "moved their center of interest to a Member State" and can be confirmed as genuinely residing in a new territory in the EU are guaranteed social security benefits as a "habitual resident."

(Read More: 'It's Horrible Here,' UK May Tell EU Migrants)

The European Commission has received several complaints from EU nationals that, while they are habitually resident within the U.K. have been denied benefits because they do not meet the "right to reside" condition under UK law. The benefits in question are: child benefit, child tax credit, jobseeker's allowance, state pension credit and employment and support allowance.

The European Commission first raised this issue with the U.K. in 2011 when it said the U.K.'s "right to reside" test unfairly discriminated against non-U.K. nationals coming from other EU states as U.K. citizens passed the test automatically.

The Commission's decision to send the matter to the EU's Court of Justice comes at a time when the issue of immigration and Britain's membership in the EU has come into question. In local elections in the U.K. in May, the United Kingdom Independence Party (UKIP) made significant gains and put pressure on Prime Minister David Cameron to bring a referendum on Britain's EU membership forward or at least make a vote guaranteed within law. A referendum is planned, if the Conservative Party wins the 2015 election, for 2017.

(Read More: EU Battle Heats Up: '50% Chance UK Out in 5 Years')

The issue of immigration is a key component of the U.K. debate on EU membership. Prime Minister Cameron wants to guarantee some reforms from the EU before heading into a referendum, and according to an Open Europe/ComRes poll 55 percent of U.K. voters said "allowing the U.K. to have its own immigration policy" was a priority in any negotiations.

Eurosceptic think tank Open Europe Research Director Stephen Booth said, "The European Commission has thrown a hand grenade into an already intense debate about the U.K.'s continued EU membership. At a time when public support for both the EU and immigration are wafer thin, this is the worst possible issue the Commission could have sought to challenge, at the worst possible time."

Back in March, Cameron announced plans to toughen up the habitual residence test by strengthening the range of questions asked.

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