Implementing the New EU Whistleblower Directive

Implementing the new EU Whistleblower Directive: _____A Transposition Guide for Journalists Published by the EUROPEAN FEDERATION OF JOURNALISTS (EFJ), the largest organisation of journalists in Europe, representing over 320,000 journalists from 70 journalists’ associations in 44 countries EUROPEANJOURNALISTS.ORG Written by Mary Inman, Carolina Gonzalez and Claudia Quinones International Whistleblower Practice of Constantine Cannon LLP in London. CONSTANTINECANNON.COM Cover by Jonathan Hadlow This report is supported by a grant from the Open Society Initiative for Europe within the Open Society Foundations Implementing the new EU Whistleblower Directive: A Transposition Guide for Journalists1 Introduction The Directive on the protection of persons who embourgish law, even though the disclosures dealt report breaches of Union Law (“EU Whistleblower with a breach of EU law (adoption of secretive tax Directive” or “Directive” ) was approved by the EU advantage agreements defeating the object and Parliament on 16 April 2019 and by the Council on purpose of corporate tax laws). Although Perrin 25 September 2019.2 Member States now have was ultimately acquitted, the Luxleaks case dis- until December 2021 to implement and comply with played the existing discrepancy among Member its terms, a process commonly referred to as trans- States on whistleblower protections and spurred position into national law. The EU Whistleblower the adoption of the Directive. Directive lays down “common minimum standards” for the protection of whistleblowers reporting cer- The adoption of the Directive in its current form is tain violations of EU law, thereby seeking to mini- a testament to considerable outreach efforts by mize inconsistent application of laws at a national various public interest groups, including journalist level. However, it is important to note that the Di- organizations, that sought to highlight the essential rective adopts a sectoral approach, which means it role whistleblowers and journalists play in disclos- affords protection to persons reporting on breach- ing information on matters of paramount impor- es of certain areas of EU law and where there is al- tance to the public. The Luxleaks, Panama Papers, ready sector-specific whistleblower protections in and Football Leaks scandals are telling examples place, its provisions do not apply. For instance, EU of why protecting whistleblowers is crucial for Eu- employment law does not fall under the scope of ropean democracy. Indeed, in Recital 46, the Direc- this Directive. tive recognizes the importance of whistleblowers as journalistic sources, noting: “Whistleblowers are, in particular, important sources for investigative The EU Whistleblower Directive takes a more ex- journalists. Providing effective protection to whis- pansive view of the type of people who may be tleblowers from retaliation increases legal certainty protected. In addition to reporting persons (whis- for potential whistleblowers and thereby encour- tleblowers), the Directive protects from retaliation ages whistleblowing also through the media. In this “facilitators” or individuals who assist the reporting respect, protection of whistleblowers as journalis- person. While on its face this seems positive for tic sources is crucial for safeguarding the ‘watch- journalists who appear to be covered by the term dog’ role of investigative journalism in democratic facilitator, use of this term could be problematic giv- societies.” en the negative connotations it has under the national legislations of many Member States, where, This transposition guide aims to provide journal- broadly defined, a “facilitator” can be deemed as ists with information on how the Directive may af- an accomplice to potential wrongdoing - criminal- fect their profession and how protections against ly or otherwise. In the Luxleaks case, for example, retaliation apply to them and their sources. It also French investigative journalist Edouard Perrin was highlights areas where journalists may seek to charged as an accomplice of whistleblower Ra- undertake further outreach efforts at the national phael Halet in his alleged violation of trade secrets level to improve how the directive is transposed, and professional secrecy regulations under Lux- including, for instance, the interplay between the 1. Whistleblower Directive and the Trade Secrets form, the Directive is meant to combat whistleblow- Directive. As one of the key public interest groups er vulnerability and respond to existing deterrents who successfully advocated for the adoption of preventing whistleblowers from coming forward the EU Whistleblower Directive, journalists now to report cases of fraud and corruption involving have an equally important role to play in advocating breaches of EU law. Other related concerns include for further improvements as the Directive is trans- the connection between whistleblower protection posed into the national laws of 27 Member States. and fundamental rights and the role of the media in providing the public with necessary information. This guide provides analysis and recommendations for journalists summarized as follows: Freedom of the press and freedom of expression are fundamental rights recognized by the Europe- + Reporting persons (whistleblowers) are pro- an Court of Human Rights (ECHR) and the Europe- tected provided their disclosures pertain to an Charter of Fundamental Rights. A responsible breaches of certain areas of EU law; media is therefore a linchpin of democratic societies. A core pillar of journalism is the protection of + The Directive does not override the applica- sources, as without anonymity and confidentiality, tion of certain laws of Member States (i.e., nation- most people would be reluctant to come forward al security ); with information. In the case of whistleblowers, there is an added fear of retaliation and even indus- + The Directive protects against retaliation facil- try blacklisting. The Directive recognizes the key itators who assist reporting persons, and the term role whistleblowers play in exposing and alerting “facilitator” is broad enough to include journalists. stakeholders about threats or harm to the public However, the term “facilitator” might carry poten- interest and seeks to incentivise whistleblowers by tial negative connotations according to the na- protecting them from retaliation. tional legislation of Member States if understood as an accomplice to wrongdoing; Whistleblowers are in a privileged position to un- cover breaches of EU law through their work-re- + Although internal reporting is no longer man- lated activities. However, current legislation on datory, public disclosure to the media is not out- the subject is fragmented across Member States. right as whistleblowers still need to show compli- Germany and Spain, for example, provide whis- ance with what could be deemed as burdensome tleblowing protection through employment legisla- and labyrinthine conditions; and tion. Other countries like the United Kingdom and, more recently, France offer broad protection. The + The Directive ensures confidentiality but does common minimum standards established by the Di- not contemplate anonymous reporting. rective attempt to level the playing field by protecting whistleblowers and their “facilitators” from retaliation. Overall, journalist organizations should consider engaging in targeted outreach efforts at the nation- Journalists must be aware of the potential gaps and al level aimed at surpassing the common minimum limitations present in the Directive, which need to be standards set out by the Directive while addressing addressed at the national level when transposition certain problematic provisions we explain below. takes place before the December 2021 deadline. The following section analyses the most relevant articles of the Directive for journalistic practice (Ar- Background ticles 2, 3, 4, 5, 6, 15, 16, 19, 21, 22 & 25) and provides some recommendations. The Directive’s legislative history3 demonstrates how a lack of uniform whistleblower protection among Member States has negatively impacted the functioning of EU policies, amounting to billions of euros in yearly losses, and led to negative spill- over effects between Member States. In its current 2. 3. Analysis Article 2: Only breaches of certain areas of EU law are cov- In lieu of comprehensive coverage, the Directive ered by the Directive. opted for a sector-specific approach in which only select areas of EU law are covered, as evidenced Material scope by the Directive’s reference to an Annex that con- tains a list of several legal instruments the Directive 1. This Directive lays down common minimum would expressly cover. This sectoral approach, standards for the protection of persons report which encompasses a limited range of wrongdoing, ing the following breaches of Union law: has the potential to create uncertainty for would-be whistleblowers, ultimately resulting in under-re- a. Breaches falling within the scope of the porting or no reporting at all. According to Trans- Union acts set out in the Annex that concern parency International, if whistleblowers feel that the following areas: they do not meet the legal criteria, they will remain silent, leaving governments and the public unaware i. public procurement; of misconduct that can harm their interests.4 ii. financial services, products and markets, and prevention of money laundering and terrorist The Directive provides a base threshold, which financing; means that Member States

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