BERLIN (Reuters) - Chancellor Angela Merkel’s coalition government is working on a new immigration law to tackle labor shortages in Germany by attracting skilled workers from countries outside the European Union.

Here are the key points of a position paper agreed by senior officials from the Labour, Economy and Interior ministries.

WHAT IMMIGRATION RULES EXIST?

Germany already has one of the most liberal immigration systems, making it the second-most popular country for immigrants after the United States, according to the OECD.

As citizens from other European Union countries enjoy free labor movement in the bloc, Germany’s new law mainly aims to relax the rules for professionals from outside Europe.

Germany has a “blue card” system in place that makes it easier for companies to hire foreign academics and professionals with an annual salary of at least 50,800 euros ($59,300).

For understaffed professions, where authorities see a special need for foreign workers, there is a lower threshold of 39,600 euros. Those professions include doctors, scientists, mathematicians, engineers and IT specialists.

WHAT CHANGES ARE PLANNED?

The three coalition parties have agreed in the outline of their new immigration law that companies will be allowed to recruit workers in all professions, regardless of the official list of sectors suffering labor shortages.

The paper also proposes that the government will no longer insist that companies give preference to German citizens in filling vacancies before looking for non-EU foreigners.

In addition, foreign graduates and workers with vocational training will have an opportunity to come to Germany to look for a job within a certain period of time if they meet certain qualification and language requirements.

They will not have access to social welfare benefits during that period but will be allowed to work in jobs for which they are overqualified so they can earn some money, the paper added.

Qualification recognition procedures in Germany will become faster and easier, the paper said, adding that the government is planning an advertising campaign in selected countries.

WHY IS THE NEW LAW CONTROVERSIAL?

Labour unions and opposition parties such as the leftist Die Linke or the far-right Alternative for Germany say firms should improve pay and conditions for locals instead of increasing labor market competition through higher immigration.

Other opposition parties such as the business-friendly Free Democrats say the new immigration law does not go far enough. They say the recognition of foreign professional qualifications is likely to remain too bureaucratic.