EU negotiators reached an agreement on rules to protect whistle-blowers, setting up safe mechanisms for reporting breaches and measures against retaliation.

On Monday, Parliament and Council negotiators reached a provisional agreement on the first EU-wide rules on protecting whistle-blowers when they report on breaches of EU law in a wide range of areas including tax fraud, money laundering, public procurement, product and transport safety, environmental protection, public health, consumer protection, data protection.

Safe reporting channels

To ensure that potential whistle-blowers remain safe and that the information disclosed remains confidential, the new rules allow them to provide information on breaches using internal and external reporting channels. Depending on the circumstances of the case, whistle-blowers will be able to choose whether to first report internally to the legal entity concerned or directly to competent national authorities, as well as to relevant EU institutions, bodies, offices and agencies.

In cases where no appropriate action was taken in response to the whistle-blower’s initial report, or if they believe there is an imminent danger to the public interest or a risk of retaliation, the reporting person will still be protected if they choose to disclose information publically.

New system to protect and encourage reporting of breaches of EU law

Safeguards against reprisals

The agreed text explicitly prohibits reprisals and introduces safeguards against a whistle-blower being suspended, demoted, intimidated or other forms of retaliation. Those assisting whistle-blowers, such as facilitators, colleagues, relatives and investigative journalists are also protected.

Member states should provide whistle-blowers with comprehensive and independent information on reporting channels and alternative procedures, advice free-of-charge as well as legal, financial and psychological support.

Whistle-blower protection is fragmented or only partial across member states, with only 10 EU countries (France, Hungary, Ireland, Italy, Lithuania, Malta, Netherlands, Slovakia, Sweden and UK) providing comprehensive legal protection. In the remaining countries, protection is only partial or applies to specific sectors or categories of employee.

A 2017 study carried out for the Commission estimated the loss of potential benefits due to a lack of whistle-blower protection, in public procurement alone, to be in the range of €5.8 to €9.6 billion each year for the EU as a whole.

“This text was one of my biggest priorities as an MEP and I am glad to see it succeed. We have had to fight to get a final text that meets expectations: whistle-blowers must be protected, whilst choosing the best means to be heard and to defend the interests of the citizens,” said Virginie Roziere (S&D).

Loss of potential benefits just in EU public procurement, due to lack of protection, is between €5.8 to €9.6 billion each year

“We reached a good deal for both whistle-blowers and companies. While the former will be free to speak up if they know about a malpractice affecting the public interest such as corruption in public procurement, a threat to public health or a tax fraud, the latter will not lose their good names due to false accusations,” said Geoffroy Didier MEP, the EPP Group’s Spokesman on the topic.

The new legislation makes sure that whistle-blowers will benefit from protection and that there will be a guaranteed follow-up of their reports. At the same time, the rules clearly define penalties for false or malicious reporting in order to damage someone’s reputation or as a means of business competition.

“We encourage whistle-blowers to report internally as, according to empirical studies, more than 90% of whistleblowers feel more at ease reporting within the organisation where they work. However, they are free to go directly to the public authorities (external channel) if they consider this necessary. Internal and external channels are the best ways to relay the information on infringement to those concerned who can contribute to the early and effective resolution of any damage to the public interest,” explained Geoffroy Didier.

The Directive will apply to national and local public administrations in cities with more than 10,000 inhabitants and all companies with more than 50 employees.

The provisional agreement will need to be confirmed by member states’ ambassadors (Coreper) and the Legal Affairs committee before being put to a final vote by the full House and Council. The directive will enter into force twenty days after being published in the EU Official Journal.