Those who want a Dutch residence permit can actually rent it for a few thousand euros a month. According to research by BNR, payroll companies ignore the warnings of the IND and assist in the creation of fictitious pay legal constructions.
Russian programmer Aleksy P. stayed in the Netherlands for at least a year on such a visa. P., currently a suspect in a major money laundering case, worked before coming to the Netherlands for an IT company that allegedly supported the Russian secret services in cyber warfare.
This “lifestyle visa” is the result of the flexible Dutch policy towards knowledge migrants, well-paid employees from abroad. Companies that want to hire highly skilled migrants have to go through a process that takes at least a few months. Subsequently, they themselves are responsible for selecting and screening the foreign nationals they employ. More than 9,000 companies in the Netherlands have a so-called “recognised sponsor” status.
P. “assumed” himself to legally reside in the Netherlands
In the Netherlands, Russian P. was formally employed by such a recognized sponsor – the Amsterdam payroll company Expatrix. However, Expatrix was itself paid for by an American company in which P. himself was a co-owner. So he was “hired through his own company in a roundabout way”, according to Martine Boerlage, prosecutor in the case against P.
However, according to the Immigration and Naturalization Service (IND), this construction is prohibited. Two weeks before Aleksy P.’s arrest, the service published a newsletter warning against doing business this way. However, BNR’s research shows that there are payroll companies that have no problem facilitating this type of dummy construction.
BNR called three IND-approved sponsors and posed as a Canadian businessman who wanted to work for his company through a payroll company in order to obtain a residence permit. The responses have been gracious. In a few minutes, a representative calculated how much it would cost him to pay his salary each month and thus obtain the residence permit. The sales clerk of a payroll company in Randstad added that “other agencies in the Netherlands will probably tell you the same thing.” Only one of the payrolls refused the request. Not because of the fake construction (which has been described as “theoretically possible”), but because this company has not done business with companies without a Dutch Chamber of Commerce number.
“I want to move to Holland, I have money, but I don’t want to work”
The “lifestyle visa” is expensive. Those who hire him must pay the employer’s costs on the notional income of at least 5,000 euros per month and several hundred euros to the payroll company: a total of around 3,000 euros per month. Subsequently, the tax is also due on the salary paid. Despite this price, the method enjoys a reputation beyond national borders. For example, an IT entrepreneur living in Rotterdam explains in a thread on Russian technology platform VC.ru (archive) that payroll through his own company is “one of two” ways to enter the Netherlands. Below the post are more than a dozen responses from interested parties. “Can you give me as much detail as possible about this payroll visa?” writes a Russian woman. “I want to move to Holland, I have money, but I don’t want to work.”
Flexible regulation also benefits the Netherlands a lot
Such excesses are a thorn in the side of other payroll companies. “I knew it was happening – it’s called a ‘lifestyle visa’ back then – but I’m shocked how easily some companies push the rules aside,” says Johan Opperman. Opperman is CEO and founder of Parakar, with a turnover of almost 200 million euros in 2022, one of the largest players in global labor outsourcing in the Netherlands. He fears that such abuses jeopardize a well-functioning system. “The fact that you can start working here as a foreign employee within a month is something no other country can match.”
The knowledge migration program therefore generates a lot of money for the Netherlands. Immigration specialists point out that wage constructions are used precisely in situations where a large economic advantage can be achieved. ‘Think of an American company that opens a new branch in the Netherlands and wants to send quartermasters here,’ says Bram van Melle, partner at Everaert Advocaten, one of the best known specialists in the field of immigration law. ‘If you then apply for recognized patronage at the IND, it will be three months later, and often even longer for new companies. It is therefore easier for such a company to temporarily work with an early-stage payroll company, after which they can still become sponsors themselves.’
IND: only ‘very small’ offenders punished
The IND says it first encountered construction where a highly skilled migrant hires themselves through a payroll company in 2019. The service has since struggled to take a stand against the gimmick. The IND checks only later and not often the tens of thousands of highly skilled migrants in our country (nearly 16,000 registered in 2021 alone). “Recognized sponsor” status is rarely revoked, says the IND. Last year was the first time a payroll company has been banned for providing a “lifestyle visa”. Stronger action is hampered by a shortage of staff, the IND says. “Proceeding with suspension or withdrawal is legally complex,” writes a spokesperson. “Because of this complexity, such investigations are labor intensive and require a lot of skill.”
The P. case suggests that checks on highly skilled migrants are considerably less stringent than those on asylum seekers. Before coming to the Netherlands, P. worked as an IT specialist for a Russian company which was placed on a sanctions list by the US authorities for involvement in Russian cyber warfare. Moscow-based Digital Security is linked in a US Treasury Department statement to, among other things, the spread of NotPetya, a virus that crippled Ukrainian society in 2017.
Research platform Investico has already written in 2021 about the fraud sensitivity of the regime of highly skilled migrants. The Ministry of Justice has therefore launched an investigation that could lead to a change in the rules. The results will be presented to the minister in the ‘first half of 2023’, writes a spokesman. Furthermore, “an interdepartmental process” deals specifically with “unwanted knowledge and technology transfer”.
Expatrix, P.’s formal employer, informed BNR that it terminated the employment contract with him shortly after his arrest, in consultation with the FIOD and the IND. The Expatrix CEO says his company never accepts clients who want to work for his company, “but we can’t control everything, of course.”
In response to BNR, P.’s wife says that her husband only worked on digital security for six months after graduation and did not work there in any way for the Russian government: “He carried out security checks, just like all the others there. I don’t think they even know who’s there anymore.”
Source: BNR
Fernando Dowling is an author and political journalist who writes for 24 News Globe. He has a deep understanding of the political landscape and a passion for analyzing the latest political trends and news.
