On July 1, 2024, an agreement with the Republic of Moldova on cooperation in the field of social security has entered into force. The agreement regulates a person's social insurance if person goes to work in another country, the right to indemnity or social benefits, however, the agreement affects the field of pensions the most, because according to the terms of the agreement, each contracting country pays out pensions for its own insurance periods.
The right to a Moldovan pension for persons living in Latvia
According to the agreement, residents of Latvia have the opportunity to claim a pension from the Republic of Moldova for periods of work or equivalent periods in the territory of Moldova, if a pension from the Republic of Latvia has not already been granted for these periods. Moldovan old-age pension can be claimed by persons who have reached the retirement age set in Moldova.
In order to request a pension for periods of work and equivalent periods in Moldova, a person must contact the SSIA department and submit a pension request, documents certifying periods of work and equivalent periods in the territory of Moldova, as well as other documents necessary for granting a specific type of pension. The received request and documents will be sent to the competent authority of Moldova for consideration. If the Moldovan pension will be granted, it will be paid to the bank account indicated in the request of the person in the Latvian credit institution. Moldovan pensions granted before the date of entry into force of the agreement shall not be revised in accordance with the provisions of this agreement.
The right to a Latvian pension for persons living in Moldova
Persons living in Moldova are entitled to a Latvian old-age pension if they have reached the retirement age set by law in Latvia and have accumulated the required insurance periods. The agreement also provides the possibility of receiving a disability pension, survivor's pension, funeral allowance, allowance for the deceased pensioner's spouse and, from July 1, 2024, also for the pensioner's partner.
Moldovan insurance periods approved by the competent Moldovan institution are considered only for determining the right to a Latvian pension, if the Latvian insurance period is insufficient to grant a pension. If a person's Latvian insurance period is less than one year, the Latvian institution does not have to grant an old-age pension for this period.
Insurance periods
For residents of Latvia who will retire after the date of entry into force of the agreement, the Latvian insurance period for which the pension is paid will no longer include the periods of work in Moldova and equivalent periods, even for citizens of Latvia, because the pension for these periods must be granted by the competent institution of Moldova in accordance with the national legislation of Moldova.
The exception is if a citizen of the Republic of Latvia lives in Latvia and his only accumulated period in Moldova before January 1, 1991 is a period of military service, then this period is considered both for the determination of the right to a Latvian pension and also for the calculation. Work and equivalent periods accumulated in the territory of third countries (for Latvia until December 31, 1990, for Moldova until December 31, 1991) and which both countries could simultaneously count in accordance with their national legislation, are taken into account by the country which a person who has requested to grant or recalculate a pension lives in.
Payment of pension due to change of residence
The legal norms provide that the pension recipient, after leaving for permanent residence in Moldova, must continue to receive the Latvian pension. In order to receive a pension in Moldova, the pension recipient must submit a request for permanent residence in Moldova to the SSIA department before leaving Latvia. Upon arrival at the new place of residence, the person must declare and inform SSIA about his euro currency account number in the Moldovan bank, to which the Latvian pension will be transferred. When a person moves to live permanently in Moldova, supplements to old-age and disability pensions for insurance period until December 31, 1995 are stopped. If the recipient of a Moldovan pension will move to Latvia, then the competent authority of Moldova will continue to pay out the granted pension. In order to continue the payment of pension, insurance indemnity or allowance, the recipient must submit a proof of life to the competent institution of the respective country. Thus, the recipient of a Latvian pension or insurance indemnity living in Moldova applies to SSIA for the extension of pension or insurance indemnity payment every year with a certificate from the competent institution of Moldova that he or she is alive, in accordance with Cabinet Regulation No. 542. A person can submit an application to SSIA for the extension of pension or insurance indemnity payment using other methods provided for in the mentioned regulations, for example by submitting an application signed with a secure electronic signature or visiting the SSIA department in person.
State social security benefit
Moldovan citizens living in Latvia who have been issued a temporary residence permit in Latvia will have the right to receive state social security benefit in case of old age and disability. Until now, state social benefits were granted only to persons permanently living in Latvia.
In order to be granted a state social security benefit, one must have lived in Latvia for a total of at least 60 months or five years. The contract stipulates that when determining this period, not only the time spent in Latvia, but also the time spent in Moldova will be taken into account, if it is insufficient in Latvia.
Example: A citizen of Moldova, who has been issued a temporary residence permit in Latvia, has been living in Latvia for the last 20 months, but for the remaining 40 months necessary to determine the right, he lived and worked in Moldova. A person has the right to a state social security benefit because he has lived in Latvia and Moldova for a total of 60 months.
Compensation insurance in connection with accidents at work or occupational diseases
According to the terms of the contract, insurance compensation is granted by the country where the accident at work occurred or the work that caused the occupational disease occurred.
If a person lives in Latvia and Latvia has a certain disability, but an accident at work occurred in Moldova or an occupational disease was detected at a Moldovan employer, then Moldova is the competent country for awarding compensation.
When arriving in person at SSIA, a person must submit a free-form written application for insurance compensation, addressed to the competent authority of Moldova. The submission must state:
- (personal) identification number in Moldova,
- the employer where the work accident occurred in Moldova,
- the date of occurrence of the work accident,
- credit institution account number,
- confirmation that you receive or do not receive a pension from another country.
VSAA will prepare the documents and send them to the competent authority in Moldova. The compensation will be awarded and paid by Moldova, by transfer to the Latvian credit institution account indicated by the person.
On the other hand, if a person lives in Moldova and has a certain disability in Moldova, but the accident at work happened in Latvia, then Latvia is the competent country for awarding compensation. Even if a person's death has occurred due to an accident at work in Latvia, then the family members of this person who are unable to work, who were fully or partially supported by him, have the right to compensation for the loss of a breadwinner. In that case, after receiving the documents from Moldova, Latvia will grant and pay the insurance compensation to a person living in Moldova, transferring it to the account of the Moldovan credit institution indicated by the person every month in euro currency.
Issuance of Certificate on Applicable Law
The contract determines which country's legislation is applicable:
- if the employer has sent the person to perform work in the territory of the other country for a certain period of time;
- if a person works in the territories of both countries, for example, persons employed in international transport,
- if the person works in one country, but the employer is registered in the territory of the other country.
A person is subject to the laws of the country in whose territory he works as an employed or self-employed person. This means that the state social insurance contributions must be made in the country where the person actually works. This also applies to the situation when the employer is registered in the territory of the other country.
If a Latvian company operating in Latvia sends its employees to work on the territory of Moldova for a period of time not exceeding 24 months, then Latvian legislation shall apply. Consequently, the employer continues to make social insurance contributions in Latvia for these employees. No contributions are required in Moldova.
The agreement stipulates that the 24-month period can be extended for another 12 months, if it is in the interests of the employees, upon mutual agreement between the competent authorities of Latvia and Moldova.
The conditions apply if employees are assigned starting from July 1, 2024.
VSAA issues a certificate to an employer who sends an employee to work in Moldova, which certifies that the person is covered by Latvian social security legislation during the period specified in the certificate and social insurance contributions for this person must be made in Latvia.