Cross-Border Digital Services Guide for EU Freelancers

The Basics of Cross-Border Service Contracts

When you work with a client in another EU member state, your service contract needs to address a few additional elements that don't arise in domestic work. Chief among these is governing law: which country's law governs the agreement and which courts have jurisdiction in the event of a dispute. The EU Rome I Regulation provides default rules for contractual obligations, but specifying your preferred governing law explicitly in your contract is always cleaner.

For most EU-to-EU B2B service contracts, the parties are free to choose the governing law. Most freelancers default to their home country law, which is entirely reasonable. Ensure your contract templates are updated to include an explicit governing law clause before your next cross-border engagement.

VAT Treatment for Cross-Border B2B Services

The reverse charge mechanism is your primary tool for cross-border B2B invoicing. When your client is a VAT-registered business in another EU member state, you invoice without VAT and include the note "VAT reverse charged under Article 196 of Council Directive 2006/112/EC." Your client self-accounts for VAT in their country.

Verify your client's VAT number via the EU VIES system before issuing the zero-rated invoice and keep a record of the verification. Use Arbeitly's invoicing platform to ensure reverse charge language is automatically included on eligible cross-border invoices.

Currency and Payment Considerations

If your client pays in a currency other than your home currency, decide upfront whether you'll quote and invoice in their currency or yours. Quoting in the client's local currency reduces friction and is often expected by clients in larger economies. However, it introduces currency risk that you must manage.

For project-based work, consider hedging by invoicing milestone by milestone rather than all at delivery, reducing your exposure to adverse currency moves over the project duration. Track multi-currency income accurately through your financial dashboard.

Intellectual Property and Cross-Border Assignments

IP law varies across EU member states despite harmonization efforts. When assigning IP rights to a cross-border client, specify the scope of the assignment explicitly in your contract — worldwide vs. EU only, perpetual vs. time-limited, all media vs. specific use cases. Vague IP clauses create disputes; precise ones prevent them.

Data Protection in Cross-Border Engagements

If your work involves processing personal data belonging to EU citizens, GDPR applies regardless of where you or your client are established. Ensure your data processing agreements are in place for any engagement that involves handling client customer data, employee data, or other personal information. This isn't just good practice — it's a legal requirement with significant potential penalties.