The European Parliament’s Directive on whistleblowing

On 16 April 2019, the European Parliament adopted a Directive on reporting certain irregularities and on protection of the informant in such cases.

Whistleblowers reporting on breaches of EU law in a number of sectors, in particular public procurement, financial services, prevention of money laundering, product safety and transport, nuclear safety, public health, consumer protection and personal data protection will be offered special measures against retaliation. Distinct protection will be extended not only to employees who become aware of violations in the course of their employment, but also to other persons, including those who perform work (also self-employed) or functions in entities (such as members of the management board) or shareholders. It is also to be afforded to persons supporting them. 

According to EU guidelines, in particular companies employing more than 50 employees will be required to introduce internal procedures that meet specific framework guidelines, including, inter alia, transparent rules for reporting information in the organisation, a three-level system for reporting irregularities and feedback to the whistleblower. In some cases, it will also be possible for whistleblowers to report outside the organisation or to publicly disclose irregularities.

The implementation of the Directive by the Member States should take place within two years. This will undoubtedly mean significant changes for entrepreneurs, additional obligations and a common need to establish internal procedures of procedure and respond to received notifications. National laws implementing EU guidelines will be key to assessing the impact on business.