On November 26, Directive (EU) 2019/1937 of the European Parliament (EP) and of the Council of October 23 (the “Directive“) on the protection of persons who report breaches of Union law was published in the Official Journal.
Background
In light of recent information scandals including Cambridge Analytica, the Panama Papers and Luxleaks, the European Commission (EC) sought to introduce a unified measure granting protection to persons who report breaches of Union Law. These scandals have highlighted how crucial whislteblowers can be in uncovering unlawful activities, and the European Union (EU) has introduced the Directive to strengthen the enforcement of Union law and protect the freedom of expression of the whistleblower when interviewed on this topic, as explained by Maria Mollica, the EU Commission’s Policy Officer. While various Member States have addressed whistleblower protection in their own national legislation, the protection is often restricted to specific areas and thus the Directive attempts to unify and harmonize the approach taken by all Member States.
The Directive
Protection is afforded to whistleblowers to the extent they fall within the definition of “reporting person,” a natural person who reports or publicly discloses information on breaches acquired in the context of his or her work-related activities (Article 5(7)). In turn, this disclosure extents to information “including reasonable suspicions, about actual or potential breaches, which occurred or are very likely to occur in the organization in which the reporting person works or has worked or in another organization with which the reporting person is or was in contact through his or her work, and about attempts to conceal such breaches.” “Breaches” refers to any act or omission that is unlawful and relate to the Union or defeat the object or purpose of the rules in the Union (Article 5(1) and (2)).
It applies to businesses which employ at least 50 employees and they are required to implement internal channels to facilitate the reporting.
In terms of its scope, the Council of the European Union (EUCO) explains in a press release that “the new rules will cover areas such as public procurement, financial services, prevention of money laundering, public health, etc. For legal certainty, a list of all EU legislative instruments covered is included in an annex to the directive.” Further, regarding the protection awarded to reporting persons, it is stated that “the rules introduces safeguards to protect whistle-blowers from retaliation, such as being suspended, demoted and intimidated. Those assisting whistle-blowers, such as colleagues and relatives, are also protected. The directive also includes a list of support measures which will be put in place for whistleblowers.”
Next Steps
On November 26, the directive was published in the Official Journal and it will enter into force on December 16. Member States then have two years from that date to implement its terms and transpose its requirements into national legislation. Press Release. Legislative Text.