The EU Whistleblower Protection Directive – How are member states handling the transposition?
With less than 6 months now to go until the 17th December 2021 deadline for EU member states to transpose the Whistleblower Protection Directive (2019/1937), progress is still very mixed.
Just one of the 27 member states – Denmark – has completed transposition of the Directive, with the new Whistleblower Protection Act (Lov om beskyttelse af whistleblowere) passed on 24th June 2021. Of the remaining 26 member states, 21 of them have begun the process of transposition but are at various stages of the legislative process, from presentations of draft laws and readings of proposed bills, to conducting public consultations. A small number of member states have not yet indicated that work to transpose the Directive into national law has commenced.
Obstacles to transposition
There are a number of factors that have contributed to the slow pace of transposition, both across all member states and in certain individual cases.
Covid-19 has obviously had a big impact – most countries have deferred legislative efforts in many areas in order to focus on the pandemic response. Perhaps ironically though, the response itself – in particular the manner in which large-scale procurement was conducted outside of normal channels – has drawn additional scrutiny and highlighted the need to protect whistleblowers reporting potential corruption issues, even in times of public crisis.
Bureaucracy is a slow process…
Some countries either already have, or may soon experience problems in passing legislation during current legislative periods. This creates a risk that long-winded legal processes may not be completed in time and will have to start again, effectively from scratch, eliminating any possibility of transpositions being completed before the December deadline. An example of this can be seen in Czechia (Czech Republic), where parliamentary elections are due in early October. There is a similar situation in Germany, where elections will be held in September.
To expand or not to expand…
Perhaps the biggest obstacle to transposition however has been the debate around whether member states should expand the scope of new laws to go beyond the minimum requirements laid out in the Directive. The EU has repeatedly encouraged member states to implement standards above-and-beyond the minimum requirements, particularly with regard to protecting those who report breaches of national law, not just EU law.
Note: The EU has no authority to legislate on national law. It was restricted to drafting a Directive that would only cover the protection of whistleblowers in the area of EU law, with provisions and recommendations included that would enable member states to expand the scope of transposition beyond the “minimum requirements” designed to create an initial common standard.
This obstacle has largely manifested itself in conflicts of interest between the parties involved. For example,in Germany, business- and justice-orientated groups have been unable to agree on the scope of the transposition, with the former resisting attempts to expand the scope of legislation beyond the minimum requirements. Indeed, the draft law presented to the German parliament in December 2020 was subsequently rejected in April 2021, the central argument for which was the supposed burden it would place on companies. For more information on the transposition in Germany, please contact us so that we can introduce you to our WhistleB partner network in Germany.
What might “expanding the scope” look like?
Many questions remain over the final scope of national transpositions. Whether or not countries will take a “verbatim” approach, applying only the minimum requirements laid out in the Directive, or whether they will, as recommended, take the opportunity to expand the scope and create a more robust framework, remains to be seen.
Probably the most important choice for member states to make is whether transpositions of the Directive should cover breaches of national law, as well as EU law. This is a very significant distinction, as failure to expand the scope in this way risks creating an unbalanced system, where better protection is afforded to those reporting minor breaches of EU law than to those who report serious breaches of national law.
Some countries though are looking to make the most of this opportunity and expand the scope of protection even further. Romania, for example, has proposed that their transposition should cover “any breach of a legal obligation as well as to actions and omissions that contradict the object or purpose of the law, including non-compliance with ethical and professional rules”. For more information about the transposition in Romania please contact us so that we can introduce you to our WhistleB partner network in Romania.
Sweden is another example, where the proposed transposition would protect those who report breaches against Swedish law, as well as those who provide information about misconduct that is not a breach of law but for which it is in the public interest that the circumstances be known. Please contact us so that we can introduce you to our WhistleB partner network in Sweden.
The issue of anonymous reporting has also been widely debated. Although the Directive makes clear that anonymous whistleblowers should be afforded the same level of protection as anyone else, it does not include any obligation for organisations to actually respond to and investigate reports from anonymous sources.
Note: Historically, the argument that reports from anonymous sources are too difficult to investigate and substantiate may have had merit. Now though, technological advances alone, such as the ability to provide two-way encrypted communications, mean that following up on anonymous reports and obtaining further information from the whistleblower, without compromising their anonymity, is easily achievable.
Other significant areas that are being debated by various member states include:
- Measures to protect whistleblowers reporting in the areas of national security and defence (e.g. Estonia)
- Provisions for financial and psychological support for whistleblowers (e.g. France)
- The introduction of personal liability for those persons who retaliate against whistleblowers (e.g. Bulgaria)
- Expanding the definition of who can be a whistleblower(e.g. Portugal)
What have the Danes done?
Now that Denmark has just become the first member state to enact the Directive in national law, the rest of the EU will no doubt have their eyes on the standards and potential precedent being set when completing their own transpositions.
The legislation strikes a bit of a balance between interested parties, expanding the scope in some areas while implementing only the minimum requirements in others. As a result, the new Danish Whistleblower Protection Act:
- Covers reporting on breaches of not just EU law, but also national law and infringements of a serious nature (including bribery, corruption, sexual harassment).
- Provides protection for whistleblowers who choose to report publicly in certain circumstances (for example, if there is an imminent threat).
- Does not include protection for reports related to issues of national security, matters covered by legal privilege, or health information covered by the Health Act.
- Does not include any requirements for organisations to respond to or investigate reports from anonymous whistleblowers.
For more information, about the Danish transposition, please contact us so that we can introduce you to our WhistleB partner network in Denmark.
What happens now?
It’s quite likely that over the next few months we’ll see quite a flurry of activity from member states as they push to complete transposition before the deadline. Whether or not all countries will manage to achieve this remains to be seen.
Even if not transposed however, the minimum requirements of the Directive will still apply in each member state from 17th December. The WhistleB solution adheres to these minimum requirements, including confidentiality, security, prompt feedback, diligent case management and GDPR compliance.
The EU has not given any indication that this deadline will be extended, so organisations should act accordingly and take the opportunity to establish processes that incorporate global best practices, ensuring they are prepared for whatever happens.
For more information on the Directive and tips on how to prepare, take a look at the WhistleB resource centre on the EU Whistleblower Protection Directive or visit https://www.navexglobal.com/en-gb/campaigns/2021-year-of-the-whistleblower.
You might also be interested in a free trial of the WhistleB system to find out how it can help you comply with the EU Whistleblower Protection Directive.