On May 19, 2017, Spain entered into the small club of countries with which China has subscribed a bilateral agreement on social security. Up to date, the Asian giant had only entered into this sort of agreement with Canada, Denmark, Finland, France, Germany, the Netherlands, South Korea and Switzerland.The agreement was signed by the Chinese Minister for Human Resources and Social Security, Mr. Yin Weimin, and the Spanish Minister for Employment and Social Security, Ms. Fátima Báñez, during the G20 Employment Ministers in Germany, as a result of the two rounds of meetings held in Madrid and Beijing, respectively, since negotiations started in 2011.
The strong economic bonds between China and Spain have resulted in an increasing number of companies expatriating employees from one country to the other. The rationale for these expatriations is not only economic; they also intend to foster cultural exchange and facilitate the internationalization of the companies involved.
However, expatriation processes imply addressing certain issues, such as avoiding increased costs due to double contributions to both the Spanish and the Chinese social security systems and protecting the expatriated employees’ rights (at least eliminating any negative impact).
In absence of a bilateral agreement, up to date companies intending to expatriate employees from Spain to China, or vice versa, were confronted with certain difficulties, which we hope the bilateral agreement will help overcome.
Stay tuned for more information on the bilateral agreement once it is made public!
By Chesy Chen, Blanca Vives and María Pilar Bover