COMMISSION STAFF WORKING DOCUMENT IMPACT ASSESSMENT Accompanying the document Proposal for a Directive of the European Parliament and of the Counci on the protection of persons reporting on breaches of Union law
Date: 2018-04-23
Institutions: Directorate-General for Justice and Consumers, European Commission
Subjects: disclosure of information, infringement of EU law, right to information, whistleblowing

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 23.4.2018  SWD(2018) 116 final  COMMISSION STAFF WORKING DOCUMENT  IMPACT ASSESSMENT  Accompanying the document Proposal for a Directive of the European Parliament and of the Counci on the protection of persons reporting on breaches of Union law   {COM(2018) 218 final} - {SWD(2018) 117 final}  
 
 
Table of Contents 

1. 

INTRODUCTION: EU POLICY CONTEXT ............................................................ 1 

2.  PROBLEM DEFINITION .......................................................................................... 4 

2.1   Whistleblower protection as one upstream component of enforcement 

of EU law ........................................................................................................... 4 
2.2   Who is a 'whistleblower' .................................................................................... 6 
2.3   How whistleblowing works – reporting channels ............................................. 9 
2.4   Underreporting of violations of EU law: magnitude of the problem and 

drivers ................................................................................................................ 9 
A.   Fear of retaliation .................................................................................. 10 
B.   Lack of sufficient protection at national and EU level ......................... 12 
Lack  of  effective  implementation:  low  awareness  and  socio-cultural 
C. 
factors .................................................................................................... 14 

2.5  

Identification of acts and areas where whistleblower protection needs 
to be introduced as an enforcement tool of EU law ........................................ 15 
2.5.1.   Acts  and  areas  where  the  added  value  of  EU  whistleblower 
protection as an enforcement tool of EU law is already acknowledged 15 
2.5.2.   Areas where the necessity of introducing EU whistleblowing rules as 
an enforcement tool of EU law is proven ............................................. 15 
2.5.3. Areas  where  the  case  for  introducing  EU  whistleblowing  rules  as  an 
enforcement  tool  of  EU  law  could  be  made  in  the  future  –  need  for 
"future-proof" EU action ....................................................................... 28 
2.6  Baseline scenario ............................................................................................. 28 

3.  NEED FOR ACTION AT EU LEVEL ..................................................................... 29 

3.1  Subsidiarity: why is the EU better placed to take action? ............................... 29 
3.2  Legal bases ...................................................................................................... 30 

4.  OBJECTIVES ........................................................................................................... 32 

5.  POLICY OPTIONS ................................................................................................... 32 

5.1   Design of the policy options – Common minimum level of protection .......... 32 
5.2  Assessed policy options ................................................................................... 37 
5.2.1  Policy option 1: Baseline scenario – maintaining the status quo .......... 38 
5.2.2. Policy  option  2:  Commission  Recommendation  providing  guidance  to 
Member  States  on  key  elements  of  whistleblower  protection 
complemented by flanking measures to support national authorities ... 39 
5.2.3  Policy Option 3: Directive introducing whistleblower protection in the 
area  of  the  financial  interests  of  the  Union,  complemented  by  a 
Communication  setting  a  policy  framework  at  EU  level,  including 
flanking measures to support national authorities ................................. 40 
5.2.4  Policy  option  4:  Directive  introducing  whistleblower  protection  in 
certain areas of EU law ......................................................................... 40 
5.2.5  Policy  Option  4  Sub  option  1:  Directive  under  policy  option  4 
complemented by a Communication setting a policy framework at EU 
level, including flanking measures to support national authorities ....... 41 

I 

 
 
6. 

IMPACT OF THE POLICY OPTIONS: ASSESSMENT ........................................ 43 

6.1   Methodology and baseline ............................................................................... 43 
6.2   Assessment of the Impacts .............................................................................. 45 
6.3   Analysis of the policy options ......................................................................... 48 
6.3.1.   Policy Option 2: Commission Recommendation providing guidance 
to  Member  States  on  key  elements  of  whistleblower  protection 
complemented by flanking measures to support national authorities ... 48 
6.3.2.   Policy  Option  3:  Directive  introducing  whistleblower  protection  in 
the  field  of  the  financial  interests  of  the  Union  complemented  by  a 
Communication providing guidance to Member States on key elements 
of  whistleblower  protection  as  well  as  flanking  measures  to  support 
national authorities ................................................................................ 50 
6.3.3.   Policy  option  4:  Directive  introducing  whistleblower  protection  in 
certain areas of EU law ......................................................................... 52 
6.3.4.   Policy  option  4  Sub  option  1:  Directive  under  policy  option  4 
complemented  by  a  Communication  providing  guidance  to  Member 
States on key elements of whistleblower protection as well as flanking 
measures to support national authorities ............................................... 55 
6.4   How do the options compare? ......................................................................... 56 

7. 

IDENTIFICATION  OF  THE  PREFERRED  OPTION:  OPTION  4,  SUB 
OPTION 1 – ANALYSIS AND OVERALL IMPACTS .......................................... 57 

7.1   Analysis ........................................................................................................... 57 
7.2   A balanced approach ....................................................................................... 58 
7.3  Measures of whistleblower protection granted by the preferred option .......... 59 
7.4  Proportionality of the preferred option ............................................................ 59 
7.5  Legal basis of the preferred option .................................................................. 60 
7.6  Coherence with existing and future EU rules .................................................. 60 
Impact on SMEs .............................................................................................. 60 
7.7 

8.  MONITORING AND EVALUATION ..................................................................... 62 

II 

 
Term or acronym 

Meaning or definition 

Glossary 

ACFE 

Charter 

CJEU 

CoE 

Commission 

Council 

DG TAXUD 

DG JUSTICE 

ECHR 

ECtHR 

EMA 

EPPO 

FCA 

GBES 

GCB 

GDP 

ICC 

MCA 

NHS 

OECD 

OLAF 

OPC 

PCaW 

PWC 

SME 

TEU 

TFEU 

UNODC 

UNCAC 

VAT 

Association of Certified Fraud Examiners 

Charter of fundamental rights of the European Union 

Court of Justice of the European Union 

Council of Europe 

European Commission 

Council of the European Union 

Directorate General for Taxation and Customs Union – European Commission 

Directorate General for Justice and Consumers – European Commission 

European Convention on Human Rights 

European Court of Human Rights 

European Medicines Agency 

European Public Prosecutor Office 

United Kingdom’s Financial Conduct Authority 

Global Business Ethic Survey 

Transparency International Global Corruption Barometer 

Gross Domestic Product 

International Chamber of Commerce 

British Maritime and Coastguard Agency   

United Kingdom’s National Health Service 

Organisation for Economic Co-operation and Development 

European Anti-Fraud Office 

Open Public Consultation 

Public Concern at Work  

Global Economic Crime Survey 

Small and Medium-sized Enterprises 

Treaty on the European Union 

Treaty on the Functioning of the European Union 

United Nations Office on Drugs and Crime   

United Nations Convention against Corruption 

Value Added Tax 

III 

 
1. 

INTRODUCTION: EU POLICY CONTEXT  

The  crucial  importance  of  effective  whistleblower  protection  for  safeguarding  the  public 
interest has generated significant debate at EU level.  

The  European  Parliament,  most  recently  in  its  resolution  of  24  October  2017,  on  legitimate 
measures to protect whistle-blowers acting in the public interest when disclosing confidential 
information  of  companies  and  public  bodies1,  called  on  the  Commission  to  present,  by  end 
2017,  a  horizontal  legislative  proposal  establishing  a  comprehensive  common  regulatory 
framework which will guarantee a high  level  of protection for whistleblowers in the  EU, in 
both  the  public  and  private  sectors,  as  well  as  in  national  and  EU  institutions.  The  Council 
encouraged  the  Commission  to  explore  the  possibility  for  future  action  at  EU  level  in  its 
Conclusions on tax transparency of 11 October 20162. 

Lack of effective protection of whistleblowers as journalistic sources raises growing concerns 
as regards its negative impacts on freedom of expression, enshrined in Article 11 of the EU 
Charter  of  Fundamental  Rights  ("Charter"),  and  on  the  "watchdog"  role  of  investigative 
journalism3. Civil society organisations and trade unions, such as Transparency International, 
Eurocadres, the European Public Service Union and the European Federation of  Journalists, 
have consistently called for an EU-wide legislation on the protection of whistleblowers acting 
in the public interest4.  

The  Commission  has  expressed  its  full  support  for  the  protection  of  whistleblowers  and 
introduced  rules  on  whistleblower  protection  in  different  sectorial  instruments.  In  2016,  it 
announced that it would assess the scope for horizontal or further sectorial EU action with a 
view  to  strengthening  the  protection  of  whistleblowers5.  This  commitment  was  affirmed  by 
President Juncker in the Letter of Intent complementing his 2016 State of the Union speech6 
and in the 2017 Commission Work Programme7.  

Protecting  whistleblowers  helps  detect  violations  and  abuse  of  the  law  harming  the  public 
interest.  Lack  of  whistleblower  protection  can  therefore  lead  to  under-detection  of  these 
violations  and  under-enforcement  of  the  law.  To  address  this,  several  Member  States  have 
introduced  measures  to  protect  whistleblowers.  The  Treaty  does  not  provide  for  a  specific 
legal basis for the EU to regulate in general the legal position of whistleblowers. In particular, 
freedom of expression, as enshrined in the Charter, cannot serve as a standalone legal basis.  

However, the problem of lack of whistleblower protection also has an EU dimension, as it can 
also impair the effective enforcement of EU law. Alongside other means, such as complaints 
and  audits,  reports  by  whistleblowers,  who  are  in  a  privileged  position  to  reveal  violations 

1  
2  
3 

4  

5  

6  
7  

result  of 

2016/2224(INI). 
http://www.consilium.europa.eu/en/press/press-releases/2016/10/11-ecofin-conclusions-tax-transparency/ 
For  instance,  at  the  second  Annual  Colloquium  on  Fundamental  Rights  on  "Media  pluralism  and 
Democracy"  in November 2016, key stakeholders highlighted that whistleblowers need confidentiality of 
their communications with journalists, but also that if their identity is revealed (which is increasingly the 
case  as  a 
they  need  protection  against 
retaliation;.http://ec.europa.eu/information_society/newsroom/image/document/2016-50/2016-
fundamental-colloquium-conclusions_40602.pdf   
A petition launched by Eurocadres gathered over 81,000 signatures and the support of over 80 relevant 
organisations https://act.wemove.eu/campaigns/whistleblowers 
In its Communication of 5 July 2016 on further measures to enhance transparency and the fight against 
tax evasion and avoidance (COM (2016) 451). 
https://ec.europa.eu/commission/state-union-2016_en 
https://ec.europa.eu/info/test-strategy/strategy-documents_en 

surveillance  and  metadata  analysis) 

1 

 
                                                            
from  inside  their  work-based  context,  can  feed  national  and  EU  enforcement  systems  with 
information leading to effective detection, investigation and prosecution of violations of EU 
rules.  

In  its  2016  Communication  on  “EU  Law:  Better  Results  through  Better  Application”8,  the 
Commission noted that enforcing EU law remains a challenge and set out its commitment to 
put "a stronger focus on enforcement in order to serve the general interest". In particular, it 
highlighted that "the effective enforcement of EU rules - from the fundamental freedoms, food 
and  product  safety  to  air  quality  to  the  protection  of  the  single  currency  -  matters  to 
Europeans and affects their daily lives. It serves the general interest. Often, when issues come 
to  the  fore  -  car  emission  testing,  water  pollution,  illegal  landfills,  transport  safety  and 
security - it is not the lack of EU legislation that is the problem but rather the fact that the EU 
law is not applied effectively. That is why a robust, efficient and effective enforcement system 
is needed to ensure that Member States fully apply, implement and enforce EU law […]".  

The EU legislator has introduced whistleblower protection in areas where it appeared urgent 
to ensure the effective implementation of EU law. For instance, following the financial crisis, 
which  exposed  serious  shortcomings  in  the  enforcement  of  EU  rules  on  financial  services, 
measures of protection of whistleblowers were included in the EU financial services  acquis, 
ranging from rules on audit to rules on market abuse9. Further examples are the introduction 
of whistleblower protection in legislation ensuring a high level of safety in civil aviation and 
maritime  transport  and  in  recommendations  related  to  fighting  corruption  addressed  to 
Member States in the context of the European Semester10.  

The  whistleblower  protection  currently  available  across  the  EU  is  uneven.  Whistleblower 
protection standards are set out in international instruments and guidelines11 such as the 2004 
UN Convention against Corruption (UNCAC), to which all Member States as well as the EU 
are  parties,  and  the  1999  Council  of  Europe  Civil  and  Criminal  Law  Conventions  on 
Corruption.  In  its  2014  Recommendation  on  Protection  of  Whistleblowers12,  the  Council  of 
Europe  recommended  that  “member  states  have  in  place  a  normative,  institutional  and 
judicial framework to protect individuals who, in the context of their work based relationship, 
report or disclose information on threats or harm to the public interest" and set out principles 
to guide States when introducing or reviewing such frameworks. 

Some  of  these  principles  have  been  taken  up  by  a  number  of  EU  Member  States  in  recent 
years. However, overall, only ten Member States have in place dedicated legislation covering 
employees  both  in  the  public  and  the  private  sector  in  all  areas  of  national  law13.  In  many 
Member  States,  protection  is  only  provided  in  the  context  of  the  fight  against  corruption  or 
only  for  public  servants.  A  large  number  of  Member  States  are  currently  considering  new 
legislation  with  a  view  to  introducing  or  strengthening  whistleblower  protection.  However, 

8  
9  
10  

11  
12  
13  

2017/C 18/02. 
Communication of 8.12.2010 "Reinforcing sanctioning regimes in the financial services sector".  
https://ec.europa.eu/info/publications/2017-european-semester-country-specific-recommendations-
commission-recommendations_en 
See Annex 7 on relevant provisions and guidelines at international level. 
https://www.coe.int/t/dghl/standardsetting/cdcj/CDCJ%20Recommendations/CMRec(2014)7E.pdf  
The  Member  States  offering  comprehensive  protection  are  France,  Hungary,  Ireland,  Italy,  Lithuania, 
Malta, the Netherlands, Sweden, Slovakia and the United Kingdom. In Cyprus and Latvia whistleblowers 
have practically no protection and in the remaining 17 Member States whistleblowers are only partially 
protected (i.e. only in certain sectors, such as financial services or only in the public sector or only against 
limited forms of retaliation). Annex 6 provides a detailed analysis of national systems of protection. 

2 

 
                                                            
even  the  legislative  projects  envisaged  do  not  point  to  a  convergence  based  on  uniform 
standards across the EU.  

Recent  scandals  with  cross-border  impacts  unveiled  by  whistleblowers,  illustrate  how 
insufficient protection of whistleblowers in a given Member State can have negative impacts 
not only on the functioning of EU policies in that Member State, but also spill-over impacts in 
other Member States and the EU as a whole, considering that violations and abuse of EU law 
reported  by  whistleblowers  typically  are  of  a  cross-border  nature  or,  even  when  purely 
national, have a cross-border impact. Uneven protection of whistleblowers across the EU can  
undermine the level-playing field needed for the internal market to properly function and for 
business  to  operate  in  a  healthy  competitive  environment;  it  can  result  in  unsafe  products 
placed on the internal market, in pollution of the environment or other risks for public health 
and  transport  safety  which  go  beyond  national  borders;  and  it  means  that  whistleblowers  in 
cross-border  situations  can  "fall  through  the  cracks"  and  suffer  retaliation  for  seeking  to 
protect the public interest.  

These  were  also  the  concerns  expressed  in  the  responses  to  the  Commission’s  2017  open 
public  consultation  (OPC)14,  which  revealed  very  strong  support  for  setting  legally  binding 
minimum standards on whistleblower protection in EU law (96% of respondents), particularly 
in  the  areas  of  the  fight  against  fraud  and  corruption;  the  fight  against  tax  evasion  and 
avoidance; the protection of the environment, and the protection of public health and safety.  

Despite any progress that may take place in certain Member States, gaps and unevenness of 
whistleblower  protection  in  areas  where  lack  of  effective  enforcement  has  negative  cross-
border impacts are bound to persist. It is therefore evident that only EU action can ensure a 
consistent high level of protection across the EU.  

It is also clear that the EU legislator needs to act proactively. Typically, Member States have 
introduced whistleblower protection following disasters and scandals which could have been 
prevented if persons who had insider information on threats or harm to the public interest had 
felt  safe  to  report  them15.  The  introduction  of  whistleblower  protection  in  the  EU  financial 
services sector is a similar case. This past experience at national and EU level attests to the 
need to use the potential of whistleblower protection as a component of enforcement of EU 
law  not  only  ex-post  in  areas  where  instances  of  serious  harm  to  the  public  interest  have 
already occurred, but also preventively.  

In  light  of  this  institutional  context  and  of  past  experience  at  national  and  EU  level, 
strengthening whistleblower protection as a means of enhancing the enforcement of EU law is 
justified and proportionate in those areas where i) there is a need to strengthen enforcement; 
ii) underreporting by whistleblowers is a key factor affecting enforcement, and iii) violations 
of EU law that may result in serious harm to the public interest.  

Such an approach will ensure that the intervention focuses on areas with a clear EU dimension 
and where the impact on enforcement is the strongest.  

14  
15  

http://ec.europa.eu/newsroom/just/item-detail.cfm?item_id=54254   
The  1998  UK  law  on  whistleblowing  was  adopted  in  the  wake  of  major  incidents,  where  the  official 
enquiries revealed that workers had known about the  malpractice which had caused them but had been 
too  scared  to  speak up.  The 2014  Irish  law  was  adopted  in  response  to  the  Irish banking  crisis and  the 
Mahon  enquiry  (the  biggest  public  enquiry  ever  held  in  Ireland,  lasting  from  1997  to  2012),  related  to 
corruption of politicians and public servants linked to planning permissions. 

3 

 
                                                            
2. 

PROBLEM DEFINITION 

2.1   Whistleblower protection as one upstream component of enforcement of EU law 

As  set  out  in  the  introduction,  many  recent  scandals  with  cross-border  impacts  derive  from 
lack of effective enforcement of EU law, pointing to the need to strengthen the enforcement 
capacity of EU and national enforcement systems.    

Violations  or  abuse  of  EU  law  which  can  cause  harm  to  the  public  interest  can  take  many 
forms,  such  as  fraud16,  corruption17  or  wrongdoing  –  deliberate  (malpractice)  –  or  not 
(negligence).  

A  number  of  actions  have  been  taken  to  improve  the  EU  and  national  capacity  to  detect, 
prosecute and deter violations of EU law. In 2017, for instance, the EU adopted the Directive 
on the protection  of the financial interests of Union18 aimed  at  ensuring the sound financial 
management  of  EU  funds  and  at  supporting  the  actions  of  the  European  Anti-Fraud  Office 
(OLAF) in combating fraud and irregularities in the implementation of the EU budget.  

Besides reinforcing the legislative framework, the EU has also empowered national and EU 
monitoring  mechanisms  and  enforcement  bodies  –  such  as  the  anti-corruption  bodies  –  to 
conduct  effective  investigations.  The  European  Public  Prosecutor  Office  (EPPO)  was 
precisely created to investigate and prosecute the perpetrators of offences against the Union's 
financial interests and thus reinforce national law-enforcement efforts to counter EU fraud. In 
many sectors, EU enforcement agencies have been created to prevent and detect violations of 
EU  law,  such  as  the  European  Aviation  Safety  Agency  (EASA).  National  enforcement 
authorities  have  been  created  and  supported  through  EU  networks,  such  as  for  instance  the 
European Union Network for the Implementation and Enforcement of Environmental Law. 

Access  to  evidence  triggering  effective  investigations  and  prosecutions  is  one  of  the  pillars 
which enforcement action relies upon. A comprehensive system of collection of evidence is 
thus  a  pre-requisite  for  an  effective  enforcement  of  EU  law.  The  EU  has  provided  citizens 
with  numerous  complaint  mechanisms19  and  has  established  statutory  audits  in  certain 
business  sectors  aimed  at  preventing  or  detecting  malpractices  which  could  distort 
competition  and  more  generally  affect  the  proper  functioning  of  the  internal  market. 
Whistleblowing is one more upstream component of the enforcement system, another tool for 
detecting violations of the law. Available evidence is particularly strong in relation to fraud. 
For  instance,  the  2007  Global  Economic  Crime  Survey  (PWC,  2007)20,  based  on  5.400 
companies  worldwide,  had  found  that  whistleblowers  helped  to  detect  more  fraud  than 
corporate security, audits, rotation of personnel, fraud risk management and law enforcement 
combined.  According  to  a  2016  study  analysing  more  than  2400  cases  of  fraud  in  114 

16  
17  

18  

19  

20  

Fraud is a deliberate act of deception intended for personal gain or to cause a loss to another party. 
Corruption takes many forms, such as bribery, trading in influence, abuse of functions, but can also hide 
behind  nepotism,  conflicts  of  interest,  or  revolving  doors  between  the  public  and  the  private  sectors. 
Although its nature and scope may differ from one Member State to another, it harms the EU as a whole 
by lowering investment levels, hampering the fair operation of the internal market (by creating business 
uncertainty, slowing processes, and imposing additional costs) and reducing public finances.  
Directive (EU) 2017/1371, of the European Parliament and of the Council, of 5 July 2017, on the fight 
against fraud to the Union's financial interests by means of criminal law. 
See, for example, channels established by the OLAF to report about information on fraud or other serious 
irregularities with a potentially negative impact for EU public funds.  
PWC  (2007)  Economic  crime:  people  culture  and  controls,  the  4th  biennial  Global  Economic  Crime 
Survey, http://www.whistleblowers.org/storage/documents/pwc_survey.pdf  

4 

 
                                                            
countries, about 40% of all detected fraud cases are uncovered by whistle-blowers21. OECD 
(2016) found that the type of corporate misconduct most often reported via internal company 
mechanisms  was  fraud  (over  40%).  Between  1986  and  2009,  the  United  States  recovered 
more than US$ 24 billion thanks to the whistleblowing law “False Claims Act”22. According 
to the 2014 and 2016 Global Fraud Reports23, the average percentage of fraud uncovered by 
whistleblowers, across countries and across sectors, is 41%. Whistleblowers were the single 
most effective way to uncover fraud (41%), followed by 31% through external audit and 25% 
through  internal  audit.  Figure  2.1  shows  that  42%  of  companies  use  the  monitoring  of 
whistleblowing hotline reports to assess the effectiveness of compliance programmes. 

Figure 2.1 – Source: PWC (2016) – Adjusting the lens on economic crime. Preparation brings opportunity 
back into focus, Global Crime Survey 2016  

In certain areas, violations of EU law are often difficult to unmask since evidence is difficult 
to  collect.  Reports by whistleblowers with  insider access to such  evidence  can  be crucial in 
those  cases.  Consequently,  ensuring  that  whistleblowers  feel  safe  to  report  can  feed 
enforcement action and enhance its effectiveness (see Figure 2.2). 

The added value of whistleblower protection in terms of increasing reports and detection of 
violations  of  law  is  evidenced  by  Member  States  already  having  a  system  of  whistleblower 
protection.  For  instance,  in  its  last  report  on  implementation  of  its  whistleblower  protection 
law  (The  Public  Interest  Disclosure Act  of  1998),  the  UK  exemplified  that  providing    for  a 
comprehensive system of protection leads to an increase of reports: the law adopted in 1998 
had increased the willingness to report suspected fraud, bribery or corruption and while 54% 
of surveyed senior executives in the rest of Europe said they would report such a case, in the 
UK, the figure was significantly higher (86%)24.  

21  

22  

23  
24  

Association  of  Certified  Fraud  Examiners,  Global  Fraud  Study  2016.  Summary  available  on-line  at 
http://www.acfe.com/rttn2016/about/executive-summary.aspx#  
US  Department  of  Justice,  ‘Justice  Department  Recovers  $  2.4  Billion  in  False  Claims  Cases  in  Fiscal 
Year 2009; More than $ 24 Billion Since 1986’, Press Release, 19 November 2009, 
http://www.justice.gov/opa/pr/2009/November/09-civ-1253.html 
Kroll (2014 and 2016), Global Fraud Report. New York: Kroll. 
Public  Concern  at  Work  (2010):  Where’s  whistleblowing  now?  10  years  of  legal  protection  for 
whistleblowers,  page  15,  available  at:  https://www.pcaw.org.uk/content/4-law-policy/4-document-
library/report-10-year-where-s-whistleblowing-now-10-year-review-of-pida.pdf  

5 

 
 
                                                            
 
In Italy, following the introduction of rules on whistleblower protection in 2015, reports to the 
Anti-corruption  agency  increased  significantly:  from  16  in  2014  to  200  in  2015;  in  the  first 
five  months  of  2017,  already  263  were  received25.  In  Ireland,  Transparency  International 
reports that the enactment of whistleblowing legislation in 2014 was followed by an increase 
of 115% in persons demanding specialist legal advice or guidance since 201126. 

Figure 2.2 – Source: European Commission - The role of whistleblowing in the enforcement chain 

2.2   Who is a “whistleblower” 

There  is  no  common  definition  of  “whistleblowing”  at  international  level  or  between  the 
Member  States  with  adopted  legislation  on  that  topic.  However,  the  baseline  for  defining 
whistleblowers  and  for  setting  EU  standards  can  be  found  in  the  2014  Council  of  Europe 
Recommendation  which  draws  upon  the  case  law  of  the  European  Court  of  Human  Rights 
(ECtHR) on the right to freedom of expression27.  

The  Council  of  Europe  defines  whistleblowers  as  any  person  who  reports  –  within  an 
organisation or to an outside authority – or discloses – to the general public – information on a 
threat or harm to the public interest in the context of their work-based relationship, whether in 
the  public  or  private  sector.  The  material  scope  of  the  protection  is  thus  defined  vis-à-vis 
reporting  acts  or  omissions  that  threaten  or  harm  the  public  interest.  Effective  protection  of 
the public interest requires that the information reported which qualifies for protection (the so-

25  

26  

27  

up 

Speak 

International, 

2017  report  of  the  Italian  Anti-corruption  agency,  available  at:  http://www.ufwhistleblowing.it/wp-
content/uploads/2017/06/ANAC_WB_Rapporto_2017  
Transparency 
https://transparency.ie/sites/default/files/17.12.13_speak_up_report_ie_final.pdf   
The  right  to  freedom  of  expression  is  enshrined  in  Article  10  of  the  European  Convention  on  Human 
Rights (ECHR) – to which all EU Member States are parties – and in Article 11 of the Charter. According 
to  Article  52(3)  of  the  Charter  "in  so  far  as  this  Charter  contains  rights  which  correspond  to  rights 
guaranteed  by  the  Convention  for  the  Protection  of  Human  Rights  and  Fundamental  Freedoms,  the 
meaning  and  scope  of  those  rights  shall  be  the  same  as  those  laid  down  by  the  said  Convention".  The 
interpretation of the right to freedom of expression enshrined in Article 10 ECHRs therefore binding as 
regards the interpretation of the same right enshrined in Article 11 of the Charter. 

available 

report 

2017, 

page 

6, 

at:  

6 

 
 
                                                            
called “protected disclosures”) can be broad, also covering acts or omissions which may not 
be  strictly  illegal,  but  which  nevertheless  represent  a  threat  or  harm  to  the  public  interest 
(“wrongdoing”).  

The Council of Europe underlines that while the notion of public interest should be generally 
understood  as  the  “welfare”  or  “well-being”  of  the  general  public  or  society  and,  in  many 
areas, such notion would be common between Member States, in other areas there may well 
be a difference of appreciation. Thus, it intentionally refrains from defining what constitutes 
the  public  interest,  providing  instead  a  non-exhaustive  list  of  categories  of  content  that  is 
typically  considered  as  a  subject  of  protected  disclosures.  These  include:  corruption  and 
criminal  activity;  violations  of 
law  and  administrative  regulations;  abuse  of 
authority/public  position;  risks  to  public  health,  food  standards  and  safety;  risks  to  the 
environment; gross mismanagement of public bodies; gross waste of public funds; a cover-up 
of any of the above. 

the 

The  Council  of  Europe  Recommendation  takes  a  broad  approach  to  the  personal  scope  of 
whistleblower protection, noting that the underlying reasons for recommending protection to 
whistleblowers is their position of economic vulnerability vis-à-vis the person on whom they 
depend for work, which goes beyond the classic definition of “employee”.  

Clearly,  employees  are  the  most  vulnerable  category  to  suffer  retaliation,  given  the  definite 
power  imbalance  in  the  employment  relationship.  Retaliation  can  occur  in  many  different 
forms,  including  suspension,  lay  off  or  dismissal;  demotion  or  loss  of  opportunities  and 
transfer  of  duties;  coercion,  intimidation  or  harassment;  ostracism  at  the  workplace; 
discrimination;  blacklisting  on  the  basis  of  a  sector  or  industry-wide  informal  or  formal 
agreement, which entails that the person will not, in the future, be economically active in that 
sector or industry; damage to their reputation and threats of retaliation.  

However,  also  persons  in  other  types  of  work-based  relationship  (such  as  suppliers, 
contractors, self-employed persons providing services, business partners, etc.):  
o  witness malpractice that would be in the public's interest to report28: Evidence suggests for 
instance  that  suppliers  are  more  likely  to  observe  bribery  and  corruption  than  non-
suppliers29,  whilst  in  specific  areas  such  as  product  safety  their  reporting has  high  added 
value, since they are much closer to the source of possible unfair and illicit manufacturing, 
import or distribution practices of non-compliant products, and,  

o  suffer retaliation. This can take the form, for instance, of early termination or cancellation 
of  their  contract  of  services,  licence  or  permit,  loss  of  business,  loss  of  income, 
blacklisting;  damage  to  their  reputation.  Also  these  categories  of  persons  should  have  at 
their disposal remedial measures against such forms of retaliation30.  

28  

30  

in 

the 

Good 

Practices 

Protection 

Besides the Recommendation of the Council of Europe, see for instance UNODC (2015) Resource Guide 
on 
Persons 
of 
https://www.unodc.orgsuppli/documents/corruption/Publications/2015/15-
04741_Person_Guide_eBook.pdf;  OECD  2010  Good  practice  guidance  on  internal  controls,  ethics  and 
compliance; Transparency International (2013) “International principles for whistleblower legislation”. 
The 2016 Global Business Ethics Survey, conducted with  more than 10,000 workers in the private and 
public sector in 13 countries (amongst France, Germany, Italy, Spain and the UK) found that employees 
in  supplier  companies  (i.e.  companies  that  supply  goods  or  services  to  other  organisations)  were  more 
likely to observe bribery and corruption (20%) than employees in non-supplier companies (12%).  
Such  as  action  for  restoring  a  cancelled  licence,  permit  or  contract;  compensation  for  other  suffering 
incurred, for instance for financial loss, or award of damages for suffering or pain caused. 

Reporting 

7 

 
                                                            
The Council of Europe,  therefore, uses  the notion of “work-based relationship” to comprise 
all  individuals  who  by  virtue  of  a  de  facto  working  relationship  (paid  or  unpaid)  are  in  a 
privileged  position  vis-à-vis  the  access  to  information  and  may  witness  or  identify 
wrongdoings at a very early stage. In this notion it includes temporary and part-time workers, 
past  employees,  trainees  and  volunteers,  whilst  recommending  extending  protection  to 
consultants,  freelance  and  self-employed  persons,  contractors  and  sub-contractors31  and  job 
applicants. 

Moreover,  it  is  important  to  make  a  distinction  between  whistleblowers  –  who  report 
violations  which  affect  the  public  interest  –  and  other  categories  of  complainants,  such  as 
aggrieved  workers,  whose  reports  relate  to  personal  grievances  or  breaches  of  individual 
working conditions (public v. private interest). 

Whistleblowers are also to be distinguished from complainants who might be clients or citizen 
bystanders  and  who  do  not  fear  retaliation  in  relation  to  their  complaint.  The  key 
distinguishing  criterion  is  the  lack  of  work-based  connection  between  the  latter  and  the 
reported person. It is because of their work-based relationship and the related risk of sanctions 
– for example, for breaching the duty of confidentiality – that whistleblowers require specific 
legal  protection,  so  that  they  can  feel  safe  to  “raise  the  alarm”.  When  there  is  no  a  power 
imbalance  between  the  reporting  and  the  reported  person,  there  is  no  need  for  protection 
against retaliation. 

Finally,  protection  of  whistleblowers  from  work-related  retaliation  should  be  distinguished 
from protection against threats of physical harm which are most likely to arise in cases where 
they report information related to organised crime. In such cases, protective measures should 
be available to them, but these should be provided by the police or under “witness protection” 
laws relevant for criminal proceedings.  

Figure 2.3 – Source European Commission – Personal scope of whistleblower protection32 

31  

32  

This approach is also taken by Member States. For example, Section 43K of PIDA grants protection to 
employees,  as  well  as  certain  workers,  contractors,  trainees  and  agency  staff  who  raise  concerns  about 
wrongdoing, risk or malpractice which it is in the public interest to disclose. 
Views to be found in Brown, A.J. (2013). Towards “Ideal” Whistleblowing Legislation? Some Lessons 
from Recent Australian Experience. E-Journal of International and Comparative Labour Studies 2(3), pp 
153–82. 

8 

 
 
                                                            
2.3   How whistleblowing works – reporting channels 

Whistleblowers  tend  to  persevere  in  reporting  directly  to  their  employers.  The  majority  of 
workers raise concerns about illegal activities inside the organisation first and they only blow 
the  whistle  outside  the  organisation  if  they  experience  organisational  retaliation  or  the 
concerns are not acted upon. A study for the French Ministry of Labour and representative of 
employees in France found that 57% of workers who reported information disclosed first the 
information to a colleague and 48% to a direct manager33. Within a sample of 1,000 callers to 
their advice line, Public Concern at Work, a UK whistleblowing charity (PCaW), found that 
line managers and managers in higher position are the first recipients of workers’ concerns, in 
74%  of  the  cases  when  the  concern  is  reported  the  first  time,  at  the  second  attempt  higher 
managers play a bigger role34.  

Whistleblowers will often persevere with their reporting if they do not see action being taken.  
PCaW35 found that 56% of whistleblowers report their concern within their organisations on 
more than one occasion. External reporting (i.e. to regulators or independent bodies) increases 
dramatically  at  the  third  attempt,  suggesting  that  reporters  are  facing  forms  of  resistance 
within their organisations. The first report was made internally in 91% of cases, a proportion 
that fell to 73% and 60% in the second and third attempt respectively. A 2015 survey of UK 
National  Health  Service  (NHS)  staff  found  that  96.6%  of  staff  who  raised  a  concern  did  so 
internally  and  concerns  were  raised  on  more  than  one  occasion:  41.7%  of  staff  raised  their 
concern in 2-3 occasions, 15.7% in 4-8 occasions, 6.7% more than 9 times36. 

In terms of areas where reports are made, 13 of the 26 public authorities that responded to the 
2017 Commission’s targeted consultation on whistleblower protection37 reported 7,059 cases 
from the previous 10 years related to tax evasion, tax avoidance, fraud, irregularities or any 
other  illegal  activities  affecting  the  financial  interests  of  the  EU,  money  laundering, 
mismanagement  of  public  funds,  misuse  of  personal  data,  threats  to  public  health  and  the 
environment, violations of human rights in general and violation of financial regulations. 

2.4   Underreporting of violations of EU law: magnitude of the problem and drivers 

As evidenced in Section 2.1, reporting by whistleblowers is one of the upstream components 
of enforcement of EU law, and a means of “feeding” law enforcement with evidence. To this 
extent,  underreporting  by  whistleblowers  translates  into  “missed  opportunities”  of  detecting 
and  preventing  violations  of  EU  law  and  weakens  the  effectiveness  of  its  enforcement.  The 
size of the problem of these “missed opportunities”, as such (i.e. the number of cases where 
violations  of  EU  law  were  not  reported  by  whistleblowers),  is,  by  its  nature,  impossible  to 
quantify. However, indications about its magnitude can be drawn from surveys investigating 
perceptions of the size of underreporting.  

33  

34  

35  
36  

37  

Technologia (2015) Fraudes, malversations, lanceurs d’alerte… Comment réagissent les salariés français? 
http://www.technologia.fr/blog/wp-content/uploads/2015/12/LanceursdAlerteDef.pdf    
Public  Concern  at  Work  (2013)  Whistleblowing:  the  inside  story.  A  study  of  the  experiences  of  1,000 
whistleblowers 
  http://www.pcaw.org.uk/content/4-law-policy/4-document-library/Whistleblowing-the-
inside-story-FINAL.pdf  
Ibid. 
Lewis,  D.,  D’Angelo  A.,  Clarke,  L.  (2015)  The  independent  review  into  creating  an  open  and  honest 
reporting culture in the NHS, quantitative research report, Surveys of NHS staff, trusts and stakeholders 
https://ec.europa.eu/taxation_customs/sites/taxation/files/platfrom_wistlebolowers.docx.pdf  

9 

 
                                                            
In  particular,  according  to  the  2017  Special  Eurobarometer  on  corruption38,  81%  of 
respondents  said  that  they  did  not  report  corruption  that  they  experienced  or  witnessed  (an 
increase of 7 % as compared to the 2014 survey). Only 18% said that they did report it (+6%). 
Also the majority of respondents (85%) to the Commission’s 2017 OPC believe that workers 
very rarely or rarely report concerns about threat or harm to the public interest.  

Further indications can be drawn from data about the magnitude of the drivers of the problem, 
set out below.  

The factors that contribute to the underreporting can be summarized as follows: 

A.  Fear of retaliation39  
B.  Lack of sufficient protection at national and at EU level 
C.  Lack of effective implementation: low awareness and socio-cultural factors. 

A.  

Fear of retaliation  

A.1.  Under-reporting is due primarily to the fear of retaliation  

Fear  of  retaliation  has  a  chilling  effect  on  potential  whistleblowers:  when  protection  is  not 
available or certain, individuals are dissuaded from reporting.  
According  to  the  2017  Special  Eurobarometer  on  Corruption40  around  one  in  three  of  all 
Europeans (29%) think that people may not report corruption because there is no protection 
for  those  reporting  it  –  a  percentage  that  has  only  slightly  decreased  compared  to  the  2014 
survey (31%). In response to the question of the OPC about the reasons why workers do not 
report  wrongdoing,  the  factors  most  commonly  selected  were  fear  of  legal  and  financial 
consequences.  Similarly,  in  response  to  the  question  which  aspects  they  consider  important 
for effective whistleblower protection, respondents mentioned as the most important measures 
to  protect  against  retaliation  at  work.  Transparency  International  France  (2015)  found  that 
39% of employees who did not report did so out of fear of retaliation41. 

Qualitative evidence about this link can be drawn from numerous investigations of disasters, 
where  authorities  found  that  workers  were  aware  of  the  underlying  problems,  but  failed  to 
report them. The official investigation into a rail crash in the UK in 1988, which killed 35 and 
injured 484 people, revealed that an inspector had seen the loose wiring but had said nothing 
because he did not want “to rock the boat”42. The public inquiry into a series of explosions 
that in 1988 destroyed the Piper Alpha oil platform in the North Sea with the loss of 167 lives, 
found  that  “workers  did  not  want  to  put  their  continued  employment  in  jeopardy  through 
raising a safety issue which might embarrass management”43. Another such example was the 
release  in  2010  from  an  industrial  reservoir  in  Hungary  of  800  million  of  litres  of  caustic 

38  

39  
40  
41  

42  

43 

report 

available 

at: 
See 
http://ec.europa.eu/commfrontoffice/publicopinion/index.cfm/Survey/getSurveyDetail/instruments/SPECI
AL/surveyKy/2176 
A more extensive analysis is provided in Annex 8. 
Ibid. footnote 36. 
Transparency  International  (2015),  “Lanceurs  d’alerte”:  quelle  perception  de  la  part  des  salariés? 
https://transparency-france.org/wp-content/uploads/2016/04/R%C3%A9sultats-sondage-Harris-
Interactive.pdf  
Investigation into the Clapham Junction railway accident. Anthony Hidden, Q.C. 1989 
http://www.railwaysarchive.co.uk/documents/DoT_Hidden001.pdf  , accessed on 6 July 2017. 
Cullen,  The  Hon.  Lord  W.  Douglas  (1990),  The  public  inquiry  into  the  Piper  Alpha  disaster.  London: 
H.M. Stationery Office.  

10 

 
                                                            
 
sludge, resulting in environmental disaster and loss of lives, where the employees knew about 
looming problems but had been threatened with dismissal by the plant’s director if they went 
to the authorities44. 

A.2 

Fear of retaliation is often well-founded 

The  first  Global  Business  Ethics  Survey45  conducted  with  more  than  10,000  workers  in  the 
private,  public,  and  not-for-profit  sectors  in  13  countries,  showed  that  33%  of  the  workers 
observed misconduct, of which 59% reported the misconduct, with 36% of these experiencing 
retaliation. Based on the Global Business Ethics Survey, it has been estimated that improving 
whistleblower  protection  would  entail  a  direct  prevention  of  retaliation  of  7%  of  the 
workforce  employed  in  the  sectors  covered  by  the  survey46.  In  the  US,  the  2013  National 
Business Ethics Survey, taken with a representative sample of private sector employees at all 
levels,  found  that  41%  of  workers  said  they  had  observed  misconduct  on  the  job.  Of  these, 
63%  reported  what  they  saw.  Not  all  of  these  are  in  need  of  whistleblower  protection. 
However, of those who reported they saw, 21% said they experienced retaliation47.  

A.3 

Retaliation can take many forms and have severe repercussions on whistleblowers 

As  reflected  in  international  guidelines48  retaliation  can  occur  in  many  different  forms, 
including threat of reprisal, suspension, lay off or dismissal, demotion or loss of opportunities 
and  transfer  of  duties,  coercion,  intimidation  or  harassment,  ostracism  at  the  workplace, 
discrimination,  damage  to  property  dismissal,  destruction  of  property,  assault  and  even 
murder.  Forms  of  retaliation  specific  to  non-employees  in  the  work-based  context  include 
early  termination  or  cancellation  of contract  of  services,  licence  or  permit,  loss  of  business, 
loss  of  income,  blacklisting  on  the  basis  of  a  sector  or  industry-wide  informal  or  formal 
agreement, which entails that the person will not, in the future, find employment in the sector 
or industry they were educated or trained for, with an impact on their future employment or 
damage  to  their  reputation.  Retaliatory  actions  may  also  be  taken  by  co-workers  of  the 
reporting  person  or  against  relatives  of  the  reporting  person  who  are  also  in  a  work-based 
relationship with the reported person.  

Examples  of  different  types  of  retaliation  can  be  found  in  the  ECtHR  case  law  assessing 
whether  such  retaliation  constitutes  interference  with  the  individuals'  right  to  freedom  of 
expression.  For  instance,  in  some  of  these  cases,  retaliation  took  the  form  of  dismissal,  of 
refusal  of  promotion;  a  premature  termination  of  employment  or  non-renewal  of  contract49. 

44 

Transparency  International  (2013),  “Whistleblowing  in  Europe:  Legal  protections  for  whistleblowers  in 
the EU”: 

https://www.transparency.org/whatwedo/publication/whistleblowing_in_europe_legal_protections_for_whistlebl

45 

46  
47  
48  

49  

owers_in_the_eu.  
ECI  (2016),  Global  Business  Ethic  Survey,  Measuring  Risk  and  Promoting  Workplace  Integrity 
http://www.boeingsuppliers.com/2016_Global_Ethics_Survey_Report.pdf.  The  Global  Business  Ethic 
Survey is industry-financed. 
http://www.world-psi.org/sites/default/files/documents/research/en_whistleblower_protection.pdf 
http://www.world-psi.org/sites/default/files/documents/research/en_whistleblower_protection.pdf 
See  for  instance  UNODC  (2015)  Resource  Guide  on  Good  Practices  in  the  Protection  of  Reporting 
Persons https://www.unodc.org/documents/corruption/Publications/2015/15-04741_Person_Guide_eBook 
.pdf; Council of Europe 2014 Recommendation; OECD (2016) 
Dorssemont, F., Lorcher, K., Schomann, I., (2013): The European Convention on Human Rights and the 
Employment Relation (2013), Hart Publishing, Oxford; page 240. Vogt v. Germany 17851/91, judgment 
of  26  September  1995;  Fuentes  Bobo  v.  Spain,  39293/98,  judgment  of  29  February  2000;  D.  Otto  v. 

11 

 
                                                            
 
Typical cases of retaliation are also identified in the study carried out for the Commission by 
Milieu  on  “Estimating  the  economic  benefits  of  whistleblower  protection  in  public 
procurement”50.  

Research demonstrates the severe repercussions that retaliation can have on both the mental 
and  the  physical  health  of  whistleblowers  (e.g.  depression  and  symptoms  analogous  to  post 
traumatic stress, but also physical pain and diseases)51. 

B. 

Lack of sufficient protection at national and at EU level 

B.1 

National level 

The lack of a comprehensive legal framework ensuring effective protection to whistleblowers 
in EU Member States is one of the main factors for underreporting and fear of retaliation. 

Only  ten  Member  States  (FR,  HU,  IE,  IT,  LT,  MT,  NL,  SK,  SE  and  UK)  have  a 
comprehensive law offering a full set of guarantees to ensure that, once whistleblowers report, 
they have legal and procedural tools to avoid or minimise the negative consequences. While 
differences  persist  between  them,  those  countries  provide  for  a  dedicated  legal  framework 
including a majority of best practices and key recommendations of the Council of Europe52. In 
the remaining nineteen Member States53, the protection granted is partial and only granted in 
specific sectors (i.e. financial services), for reporting specific types of violations (i.e. fraud or 
corruption),  only  to  public  or  private  workers  or  only  against  limited  forms  of  workplace 
retaliation  or  is  not  regulated  at  all..  Within  Member  States’  legal  orders,  rules  on 
whistleblower protection are often scattered across different laws (anti-corruption laws, public 
service laws, labour codes, criminal codes and sector-specific laws, such as competition laws 
and  financial/banking  laws).  This  fragmentation  creates  legal  uncertainty  which  has  a 
dissuasive  effect,  as  potential  whistleblowers  cannot  be  confident  that  they  will  enjoy  the 
protection  of  the  law54.  Moreover,  a  large  number  of  Member  States  do  not  require  the 
existence  of  internal  or  external  reporting  channels,  which  makes  very  complicated  the 
protection of confidentiality but also the follow-up of the reports.  

These  gaps  and  this  fragmentation  of  protection  mean  that,  in  many  situations,  individuals 
who  draw  attention  to  a  wrongdoing  they  witness  are  not  effectively  protected  against 
retaliation.  Piecemeal  national  approaches  do  not  offer  sufficient  protection  of 
whistleblowers.  An  example  is  the  Luxembourg  law  which  only  covers  whistleblowing  on 
corruption. This law could not be used to protect the “Luxleaks” whistleblowers. Moreover, 
the different national  courts which assessed their  case outside this framework of protection, 

50 

51  
52 
53 

54  

Germany,    27547/02,  judgment  of  24  November  2005;  T.  Lahr  v.  Germany,  16912/05,  judgment  of  1st 
July 2008; Heinisch v. Germany, 28274/08, judgment of 11 July 2011.  
Milieu  (2017).  As  an  example  of  such  a  case,  a  controller  at  the  National  Forestry  Centre  in  Slovakia, 
who had reported, in 2010, the intended misuse of public funds in the tendering of a project in the value 
of  EUR  700,000,  was  fired  and  remained  unemployed  for  years  as  she  could  not  find  work  in  other 
companies. It was only in 2016 that the courts made a final decision that her dismissal was illegal. She 
was later offered to return to the Centre, but not as a comptroller. 
See in detail in Annex 8. 
On the key aspects of a comprehensive protection provided by the Council of Europe, see Annex 7. 
Annex  6  provides  a  comparative  analysis  of  the  different  national  systems  of  whistleblower  protection 
based on key elements of protection as provided by the Council of Europe.  
The  Commission’s  OPC  investigated  the  significance  of  factors  that  raise  awareness  of  whistleblower 
rights  and  procedures  for  effective  whistleblower  protection.  One  of  the  two  factors  most  commonly 
selected were a clear definition in law of the threats to public interest covered by whistleblower protection 
(75% of individuals and 63% of organisations). 

12 

 
                                                                                                                                                                                          
reached  very  different  conclusions,  which  shows  the  legal  uncertainty  on  the  scope  and 
conditions  for  whistleblower  protection  persisting  in  the  national  level.  Remedying  legal 
uncertainty  was  precisely  one  of  the  main  objectives  of  the  Irish  legislator,  who,  in  2014, 
abandoned  the  previous  sector-by-sector  approach  and  adopted  a  single  comprehensive 
legislative act.  

In  some  Member  States  draft  proposals  for  legislation  on  whistleblower  protection  are 
currently under discussion at government level or in the national Parliaments. However, these 
reforms  are  likely  to  be  incomplete,  incremental  and  uncoordinated.  In  some  cases,  draft 
legislative  proposals,  even  if  adopted,  may  not  result  in  major  changes  or  protection  would 
still be provided on an ad hoc basis through piecemeal provisions within one or more laws. 

Insufficient  protection  within  a  single  Member  States  and  divergence  of  the  national  legal 
frameworks contribute to underreporting and have spill-over impacts on other Member States 
and the EU as a whole. 

Even if a Member State has a comprehensive legal framework, its protection is limited to its 
own  jurisdiction55  while  a  whistleblower  may  choose  a  different  country  to  report  or  the 
information  reported  may  be  passed  across  national  boundaries  by  authorities  in  one 
jurisdiction  to  authorities  in  another  (examples  of  cross-border  whistleblowing  are  the 
employees  of  banks  in  some  Member  States  who  may  wish  to  give  information  to  tax 
authorities of other Member States or situations such as “Luxleaks”). Uneven protection may 
thus dissuade reporting and can result in gaps in the protection of whistleblowers who work 
for foreign based companies or in another Member State than the one whose law governs their 
employment  relationship  and  who  risk  “falling  through  the  cracks”.  Examples:  i)  a  French 
company  moving  to  Greece,  whose  law  on  whistleblower  protection  does  not  apply  to  the 
private  sector,  would  normally  maintain  its  corporate  policy56,  based  on  French  law,  which 
provides for extensive whistleblower protection. But if the employees feel reassured and blow 
the  whistle,  in  the  end,  they  will  remain  unprotected;  ii)  a  person  working  in  France  for  a 
subsidiary  of  a  Greek  company  who  blows  the  whistle  and  suffers  retaliation  from  his/her 
Greek employer would not receive protection under French law.  

Finally, uneven protection across the Member States increases economic costs for companies 
established in more than one EU country, which need to adjust their internal arrangements and 
train their employees accordingly.  

B.2 

European level 

At  EU  level,  the  protection  provided  is  also  piecemeal:  there  are  a  limited  number  of 
legislative instruments57 that provide for reporting channels and certain elements of protection 
in  varying  degrees,  and  only  in  specific  areas  (most  instruments  concern  financial  services, 
others  are  related  for  instance  to  anti-money  laundering,  transport  safety,  environmental 

55  

56  

57  

The protection provided by Member States' laws is in most cases limited to their own jurisdiction or to 
employment  contracts  under  their  own  law.  There  are  some  exceptions  in  countries  such  as  UK  and 
Ireland, whose laws apply to workers with UK/Irish employment contracts regardless of the geographical 
location of the malpractice and regardless of whether the breach of a legal obligation arises under their 
law or the applicable law of another country. 
According  to  the  information  provided  in  the  ICF  study  (Annex  13),  large  businesses  under  the 
jurisdiction  of  third-country  legislation  (e.g.  US-listed  firms)  may  be  compelled  to  have  whistleblower 
arrangements  when  operating  in  the  EU  even  if  that  is  not  required  in  the  Member  State  where  they 
operate. 
See Annex 6 for a detailed analysis. 

13 

 
                                                            
protection  or  the  equality  acquis).  The  sectorial  protection  offered  at  EU  level  is  thus  very 
limited  in  scope,  aimed  at  ensuring  enforcement  of  specific  EU  instruments  and  not  even 
covering the whole areas concerned.  

Moreover,  the  level  of  protection  provided  by  EU  law  is  limited:  the  existing  provisions 
merely seek to encourage whistleblowing by essentially requiring – in most cases – Member 
States: i) to establish  channels for reporting violations of the relevant  rules; ii) to  guarantee 
confidentiality  and  (iii)  to  take  measures  for  the  protection  of  whistleblowers  from 
employment-related  retaliation,  and  other  types  of  unfair  treatment.  They  therefore  do  not 
provide  a  definition  of  the  scope  ratione  personae  of  the  protection,  do  not  define  the 
conditions for granting protection, do not specify the forms of protection to be granted, and do 
not specify the possible remedial measures against retaliation.  

C. 

Lack of effective implementation: low awareness and socio-cultural factors 

A lesson learnt from the existing implementation of national systems is that legislation is not 
enough. It needs to be complemented by measures of awareness and information to the public. 
In the workshops organised by the Commission, Member States' experts underlined the need 
for  awareness-raising  campaigns  and  the  added  value  of  producing  guidelines  to  employers 
and employees.  

Potential whistleblowers who witness illegal activities and who feel safe to report them may 
not  do  so,  simply  because  they  do  not  know  where  and  how  to  report.  The  2017  Special 
Eurobarometer  on  corruption58  found  that  49%  of  respondents  would  not  know  where  to 
report  corruption  if  they  were  to  experience  or  witness  corruption  (an  increase  of  5  points 
compared  to  the  2014  survey).  Just  under  half  (47%)  said  that  they  would  know  where  to 
report it. 

Only 15% of all respondents to the Commission’s OPC had knowledge of existing rules on 
whistleblower  protection  in  their  country  of  residence  or  establishment.  In  response  to  the 
question  about  factors  that  raise  awareness  of  whistleblower  rights  and  procedures  for 
effective whistleblower protection, one of the two factors they most commonly selected were 
state-led information and awareness-raising campaigns on the rights of whistleblowers (75% 
of respondents). 

Further barriers contributing to underreporting by whistleblowers are linked to socio-cultural 
factors such as the belief that reporting the wrongdoing would be futile and not be followed 
up, the loyalty to the employer59 or deep-rooted negative social perceptions of whistleblowers 
as “sneaks”, “informers” and “snitches”, resulting in their harassment and ostracism.60 Asked 
about the reasons why workers do not report wrongdoing, respondents to the OPC identified 
the fear of bad reputation as the third most important reason (45% of respondents)61.   

58  
59  
60  

61  

See footnote 38. 
See ICF's Study for more details (Annexes 13-14). 
Transparency International (2013), Whistleblowing in Europe: Legal protections for whistleblowers in the 
EU.  
See also the Nyberg Report which investigated the causes of the collapse of the banking sector in Ireland, 
and  identified  the  ostracism  that  workers  and  potential  whistleblowers  faced  as  contributing  to  the 
underlying  causes  of  the  crisis:  “there  may  have  been  a  strong  belief  in  Ireland  that  contrarians,  non-
team  players,  fractious  observers  and  whistleblowers  would  be  informally  (though  sometimes  even 
publicly) sanctioned or ignored, regardless of the quality of their analysis or their place in organisations; 
Nyberg Report (2011), Misjudging risks: causes of the systemic banking crisis in Ireland. Report to the 
Commission of investigation into the banking sector in Ireland 

14 

 
                                                            
 
Identification  of  acts  and  areas  where  whistleblower  protection  needs  to  be 

2.5  
introduced as an enforcement tool of EU law 

EU  policy  areas  and  acts  where  the  introduction  of  whistleblower  protection  would  be 
necessary and proportionate are to be identified based on the following criteria: i) there is a 
need  to  enforcement;  ii)  underreporting  by  whistleblowers  is  a  key  factor  affecting 
enforcement, and iii) violations of EU law may cause serious harm to the public interest. The 
areas  below  are  those  identified  based  on  currently  available  evidence  as  fulfilling  these 
criteria. 

2.5.1.   Acts  and  areas  where  the  added  value  of  EU  whistleblower  protection  as  an 
enforcement tool of EU law is already acknowledged62  

In a number of EU acts and policy areas, the legislator has already acknowledged the added 
value of whistleblower protection as a key tool to encourage reporting and enhance upstream 
the collection of information that enforcement bodies need to detect violations of EU law.  

The  financial  services  are  an  area  where  the  EU  legislator  has  sought  to  provide  for 
whistleblower  protection  in  all  relevant  instruments.  Another  such  area  is  the  prevention  of 
money  laundering  and  terrorist  financing63,  the  EU  legislator  has  sought  to  put  in  place 
systems to facilitate reporting of violations. 

In other areas, elements of whistleblower protection have been introduced in some key acts. 
For  instance,  in  the  area  of  transport  safety,  such  elements  have  been  introduced  in 
instruments  related  to  civil  aviation  and  maritime  transport;  in  the  area  of  environment 
protection, in an instrument related to the safety of offshore oil and gas operations. 

Any  initiative  to  strengthen  whistleblower  protection  at  EU  level  would  need  to  ensure 
consistency amongst existing EU rules and align them to common high standards64. 

2.5.2.   Areas where the necessity of introducing EU whistleblowing rules as an enforcement 
tool of EU law is proven  

(i)    The protection of the EU budget 

The protection of the financial interests of the EU is a core area in which enforcement of EU 
law  needs  to  be  strengthened.  A  lack  of  enforcement  of  financial  rules  not  only  causes  a 
decrease of the revenues or the budget as a whole, which in turn leads to inefficient provision 
of public services, but it can also distort public investments and growth and reduces economic 
performance.  While  at  national  level  fraud,  corruption  and  other  undue  appropriations  are 
types  of  violations  of  law  that  affect  national  expenditure,  they  can  also  heavily  affect  the 
financial  interests  of  the  Union  –  by  affecting  the  collection  of  EU  revenues  (e.g.  fraud  to 

62  
63  

http://www.bankinginquiry.gov.ie/Documents/Misjuding%20Risk%20-
%20Causes%20of%20the%20Systemic%20Banking%20Crisis%20in%20Ireland.pdf 
All these instruments are presented in detail in Annex 6. 
Directive  (EU)  2015/849  of  the  European  Parliament  and  of  the  Council  of  20  May  2015  on  the 
prevention of the use of the financial system for the purposes of money laundering or terrorist financing, 
amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and repealing 
Directive  2005/60/EC  of  the  European  Parliament  and  of  the  Council  and  Commission  Directive 
2006/70/EC  and  Regulation  (EU)  2015/847  of  the  European  Parliament  and  of  the  Council  of  20  May 
2015 on information accompanying transfers of funds and repealing Regulation (EC) No 1781/2006 (OJ 
L 141, 5.6.2015, p. 1–18). 

64   Where these instruments are addressed to Member States and relevant legal bases are compatible. 

15 

 
                                                                                                                                                                                          
  
customs  duties),  the  use  of  EU  expenditures  (e.g.  fraud  to  structural  funds)  or    the 
management of EU assets(e.g. EU buildings)65.  

In 2016, RAND Europe estimated that corruption costs the EU between EUR 179bn and EUR 
990bn  in  GDP  terms  per  year66.  According  to  the  2016  EY  14th  Global  Fraud  Survey  on 
corporate misconduct,67 some EU Member States are within the first 30 top ranking countries.  

The Commission estimated that the financial interests of the Union are potentially adversely 
affected  to  an  amount  of  EUR  4  billion  yearly  due  to  fraud,  corruption  and  other  related 
offences68.  The  total  of  all  offences  against  the  financial  interests  of  the  Union69  in  the 
Member States reported in 2016 (fraudulent or not, regarding EU expenditures or revenues) 
was  17,030  offences,  involving  a  total  damage  of  about  EUR  2.9  billion.  OLAF  opened,  in 
2016, 219 investigations on fraud affecting the EU budget, and concluded 272 investigations, 
which resulted in 346 recommendations for recovery of EUR 631.1million70.  

In  this  area,  whistleblowers  are  one  of  the  sources  through  which  OLAF  receives  reports 
about suspicions of related irregularities. Where the whistleblowers are EU staff, they enjoy 
the  protection  offered  by  the  Staff  Regulations,  including  against  retaliation71.  However,  all 
other  reporting  persons  who  may  suffer  retaliation  from  their  employer  in  connection  with 
their reporting to OLAF are protected in accordance with the applicable national law, when 
such protection exists in national law. 

Acknowledging this deficiency at EU level, the EPPO Regulation encourages Member States 
to provide, in accordance with their national law, effective procedures to enable reporting of 
possible  offences  falling  within  the  EPPO's  competence  and  to  ensure  protection  of  the 
persons  who  report  such  offences  from  retaliation,  and  in  particular  from  adverse  or 
discriminatory employment actions72.  

The  role  of  the  whistleblowers  in  reinforcing  the  fight  against  fraud  and  the  need  to  set  up 
measures enhancing prevention and deterrence was also highlighted by the European Court of 
Auditors in its October 2017 Audit brief on Fighting fraud in EU spending, which mentions 

65  

66  

67 

68  

69 
70 

71 

72 

(2016), 

Corporate 

According to Article 325 TFEU, the obligation to protect the Union's financial interests is shared between 
the EU and the Member States and therefore the power of investigation of EU bodies also encompass the 
enforcement  of national  law not linked with  EU  law (for example  national  law,  against VAT fraud not 
directly  implementing  EU  legislation).  See  further  explanations  at  https://ec.europa.eu/anti-fraud/about-
us/mission_en  
RAND  (2016),  The  Cost  of  Non-Europe  in  the  area  of  Organised  Crime  and  Corruption,  Annex  II  – 
Corruption, 
http://www.europarl.europa.eu/RegData/etudes/STUD/2016/579319/EPRS_STU%282016%29579319_E
N.pdf.  
EY 
individual 
  http://www.ey.com/Publication/vwLUAssets/EY-corporate-misconduct-individual-
consequences/$FILE/EY-corporate-misconduct-individual-consequences.pdf.  
Information provided in the impact assessment for an initiative to protect the financial interests of the EU, 
http://europa.eu/rapid/press-release_IP-13-709_en.htm.  
Annex 10 details further data on fraud and corruption against the EU budget. 
OLAF  Report  2016,  https://ec.europa.eu/anti-fraud/sites/antifraud/files/olaf_report_2016_en.pdf.  This 
figure  is  not  a  direct  indication  of  the  overall  level  of  fraud  in  EU  spending,  but  rather  a  conservative 
estimate, given that the level of recovery recommended by OLAF depends on the scope and scale of the 
investigations concluded in a given year. 
The Staff Regulations of officials and Conditions of Employment of other servants of the European Union 
include, since 2004, rules on whistleblowing, setting out procedures for reporting any fraud, corruption or 
serious irregularity, and providing protection to whistleblowers from adverse consequences. 
Council  Regulation  (EU)  2017/1939  implementing  enhanced  cooperation  on  the  establishment  of  the 
European Public Prosecutor's Office (the "EPPO Regulation"), recital 50. 

consequences,

misconduct 

– 

16 

 
                                                            
that  whistleblowing  measures  are  much  less  costly  and  time‐consuming  than  the  lengthy 
process of fraud detection, investigation and prosecution73.  

Tax evasion and tax fraud of particular revenues linked to the EU budget hamper the financial 
interest  of  the  EU  and  may  also  lead  to  inefficiencies  in  terms  of  competitiveness  of 
businesses across the EU. The Commission has established in the last decade a large number 
of actions aimed at supporting national authorities to investigate and prosecute fraudsters that 
try  to  escape  their  tax  obligations,  taking  advantage  of  the  fact  that  tax  officials  cannot 
recover taxes themselves outside their national borders. Notwithstanding, fraud relating to the 
VAT, one of the sources of income of the EU budget, is still one of the most widespread types 
of tax fraud which go unreported. Even if by nature it is difficult to assess the magnitude of 
VAT fraud, it is estimated that out of the EU VAT gap74 estimated at almost EUR 160 billion 
revenue losses each year75, EUR 50 billion would be due to VAT fraud alone76. . 

(ii)   Areas crucial for the proper functioning of the internal market 

a) Public procurement 

Lack  of  enforcement  of  EU  rules  on  public  procurement  has  two  dimensions.  On  the  one 
hand,  fraud  and  corruption  can  occur  in  the  context  of  procurement  carried  out  by  the  EU 
institutions and bodies (breach of the EU Financial Regulation and its rules on procurement). 
A large share of OLAF’s investigations in 2014-2016 related to fraud in public procurement, 
mainly  in  relation  to  structural  funds  and  external  aid.  The  costs  of  corruption  risk  in  EU 
public procurement across all sectors was estimated at EUR 5 billion per year77. 

On  the  other  hand,  fraud  and  corruption  can  be  linked  to  national  public  procurement.  In 
many  sectors  such  as  energy,  transport,  waste  management,  social  protection  and  the 
provision of health or education services, public authorities are the principal buyers78.While 
insufficient  enforcement  of  rules  on  public  procurement  occurs  at  national  level,  it  creates 
distortions  of  competition  across  the  EU,  increases  costs  for  doing  business,  violates  the 
interests of investors and shareholders and, overall, lowers attractiveness for investment, thus 
affecting  the  proper  functioning  of  the  internal  market.  In  2014,  the  EU  reinforced  rules 
seeking  to  ensure  that  public  contracts  are  consistently  awarded  in  an  open,  fair,  and 
transparent manner across  the EU and introduced minimum harmonised public procurement 
standards for the award of public contracts by or on behalf of Member States’ authorities79. 

Despite these legislative efforts, unlawful practices still occur in public procurement. A 2017 
study  carried  out  for  the  Commission  provides  evidence  on  how  whistleblowers  effectively 
contribute to the detection of such practices by disclosing information that may not be readily 

73 
74 

75 

76  

77 
78 

79 

includes 

financial 

insolvencies 

bankruptcies, 

https://www.eca.europa.eu/Lists/ECADocuments/AB_FRAUD_RISKS/AB_FRAUD_RISKS_EN.pdf  
The VAT gap is an approximation of the government revenue lost to tax evasion and tax avoidance (but 
also 
miscalculations) 
and 
https://ec.europa.eu/taxation_customs/business/tax-cooperation-control/vat-gap_en  
European Commission - Press release VAT Gap: Nearly €160 billion lost in uncollected revenues in the 
EU in 2014 Brussels, 6 September 2016 http://europa.eu/rapid/press-release_IP-16-2936_en.htm 
Study  by  EY,  2015,  Implementing  the  ‘destination  principle’  to  intra-EU  B2B  supplies  of  goods: 
https://ec.europa.eu/taxation_customs/sites/taxation/files/docs/body/ey_study_destination_principle.pdf 
https://ec.europa.eu/taxation_customs/business/tax-cooperation-control/vat-gap_en.  
In  the  area  of  public  procurement,  every  year  over  250,000  public  authorities  in  the  EU  spend  around 
14% of GDP on the purchase of services, works and supplies. 
See  for  example  Directive  2014/24/EU  of  the  European  Parliament  and  of  the  Council  of  26  February 
2014 on public procurement. 

17 

 
                                                            
available80. This study estimated the loss of potential benefits due to a lack of whistleblower 
protection in the area of public procurement alone to be in the range of EUR 5.8 to EUR 9.6 
billion each year for the EU as a whole.  

b) Competition 

EU competition policy aims to protect the efficient functioning of markets from competition 
distortions  whether  originating  from  Member  States  (distortive  State  aid),  market  players 
(distortive  unilateral  or  coordinated  behaviour),  or  mergers  that  would  significantly  impede 
effective  competition.  The  estimated  direct  benefits  of  interventions  by  the  Commission 
during  2017  in  the  cartel  and  merger  areas  alone  range  from  3.9  to  6.2  billion  euros.   This 
illustrates  the  magnitude  of  harm  that  breaches  of  the  EU  competition  rules  have  on  EU 
consumers and public interests.  

The ability to detect infringements of antitrust rules, circumventions of the merger rules (e.g. 
early  implementation  of  a  non-approved  merger)  or  illegal  state  aid  (e.g.  in  the  context  of 
fiscal measures) is crucial to ensure the proper enforcement of EU competition rules. In order 
to increase the detection possibilities, measures have already been undertaken to facilitate and 
incentivise  companies  and 
to  report  potential 
wrongdoings to the Commission. The Leniency Programme has been a very successful tool to 
uncover  secret  cartel  arrangements  that  may  otherwise  go  undetected.  Companies  however 
increasingly weigh the benefits of immunity from fines or leniency reductions against the risk 
of  important  payments  in  follow-on  private  damage  actions.  The  digitalisation  and 
globalisation  of  markets  have  also  resulted  in  complex  business  models  and  distribution 
systems  that  would  nowadays  often  require  insider  knowledge  to  detect  and  successfully 
investigate.  

individuals  with 

information 

insider 

In order to strengthen the fight against cartels and other antitrust violations, the Commission 
introduced  in  March  2017  an  online  tool  that  can  be  used  to  anonymously  alert  the 
Commission  of  breaches  of  antitrust  law81.  This  new  communication  channel  gives 
whistleblowers the possibility to report illegal practices in full anonymity but does not offer 
protection to them if their identity becomes known to those who might take retaliatory action 
against  them.  Moreover,  experience  shows  that  the  ability  to  interact  directly  with  an 
identified  whistleblower  allows  for  a  more  efficient  and  successful  investigative  process. 
Effective protection for whistleblowers would encourage and enable the individuals to come 
forward without fearing retaliation.  

In  the  area  of  antitrust,  the  Commission  shares  the  responsibility  of  enforcing  the  EU 
competition rules with national competition authorities. Only a very limited number of those 
have similar anonymous communication tools in operation. The introduction of protection of 
whistleblowers at Member State level would therefore have a significant impact on the ability 
of  those  authorities  to  detect  and  bring  infringements  of  EU  competition  law  to  an  end.  It 
would also strengthen the incentives for companies to come forward and report cartels under 
leniency programmes themselves rather than risking detection through whistleblowing. 

c) Aggressive tax planning schemes 

80 

81  

Milieu (2017), on “Estimating the economic benefits of whistleblower protection in public procurement” 
https://publications.europa.eu/en/publication-detail/-/publication/8d5955bd-9378-11e7-b92d-
01aa75ed71a1/language-en  
http://www.jonesday.com/European-Commission-Launches-Competition-Law-Anonymous-
Whistleblower-Tool-04-25-2017/?RSS=true 

18 

 
                                                            
Tax schemes that amount to evasion or avoidance negatively affect the proper functioning of 
the internal market.  

Whilst tax evasion involves violations of the law, taxpayers who engage in tax avoidance act 
against the spirit and purpose of the tax provisions with the intention of reducing their tax bill. 
In this context, aggressive tax planning consists in taking advantage of the technicalities of a 
tax  system  or  of  mismatches  in  the  interaction  between  two  or  more  tax  systems  for  the 
purpose of reducing tax liability82. The outcome of such situations could give rise to unfair tax 
competition and  extensive tax evasion, distorting the level-playing  field between companies 
that  manage  to  avoid  paying  their  fair  share  of  taxes  and  other  companies  that  do  not  have 
access  to  the  same  cross-border  tax  planning  possibilities  (mostly  domestic  and/or  smaller 
firms)83. OECD found in 2013 that multinational companies pay as little as 5% in corporate 
taxes thanks to aggressive strategies to reduce tax liability, whilst smaller businesses pay up to 
30%84. Moreover, profit-shifting results in loss of tax revenues for Member States and for the 
EU  as  a  whole  (estimated  to  about  EUR  50-70  billion  per  year)85.  The  “Luxleaks”  scandal 
illustrated the distortions of competition resulting from such tax schemes (as EU companies 
not  located  in  Luxembourg  could  not  benefit  from  these  arrangements)  and  their 
consequences for the overall budget of the EU.  
A 2017 European Parliament study86 estimated that the schemes uncovered by the “Panama 
Papers” had a budgetary impact (revenue loss) of approximately EUR 19 billion across eight 
Member States. The revenue loss for the entire EU-28 was estimated at EUR 109-237 billion, 
with  a  mid-point  of  EUR  173  billion87.  It  estimated  the  volume  of  tax  base  shifted  by 
companies in these eight Member States in 2015 at EUR 88 billion. The cascade effects of tax 
losses for Member States include less public money being available to invest in support for 
economic growth, job creation and public services88.  

82 

83 

84 
85 

86  
87 

88 

For instance, taxpayers may benefit from low tax rates or double deductions or ensure that their income 
remains  untaxed  by  making  it  deductible  in  one  jurisdiction  whilst  this  is  not  included  in  the  tax  base 
across the border either. The increased mobility of capital and persons in the internal market exacerbates 
the opportunities for taking advantage of the way that disparate national tax systems interact with each 
other 
Multinational enterprises in high tax countries pay around 30% less tax than comparable domestic firms 
and benefit from a competitive cost advantage that can allow them to gain market shares and raise entry 
barriers  to  the  detriment  of  other  firms.  https://ec.europa.eu/info/sites/info/files/file_import/european-
semester_thematic-factsheet_curbing-agressive-tax-planning_en.pdf 
http://www.oecd.org/tax/oecd-urges-stronger-international-co-operation-on-corporate-tax.htm. 
Data gathered from European Parliament Study: “Bringing transparency,  coordination  and  convergence 
to corporate tax policies in the European Union – I -Assessment of the magnitude of aggressive corporate 
tax planning at: 
http://www.europarl.europa.eu/RegData/etudes/STUD/2015/558773/EPRS_STU%282015%29558773_E
N.pdf .Taxpayers may try to reduce their tax bill by moving their tax residence and/or assets to a low-tax 
jurisdiction.  Such  practices distort the  market  because  they  erode  the  tax base of  the  State  of departure 
and shift future profits to be subject to tax in the low-tax jurisdiction of destination. If taxpayers move 
their  tax  residence  out  of  a  certain  Member  State,  this  State  will  be  deprived  of  its  future  right  to  tax 
revenues  of  these  taxpayers,  which  in  turn  affects  the  overall  EU  budget  since  Member  States 
contributions are lower. 
http://www.europarl.europa.eu/cmsdata/111503/Riondet%20Europol%20QA%20edited.pdf.  
The  study  focused  on  a  sample  of  eight  Member  States:  Cyprus,  Czech  Republic,  Denmark,  France, 
Germany,  Poland,  Spain  and  United  Kingdom.  The  study  methodology  was  based  on  desk  research, 
stakeholder interviews in Member States and microeconomic simulations using the OECD Orbis dataset 
which contains financial data for over 44 million globally. The study does not estimate the tax revenue 
impact of the schemes revealed in the Panama Papers but makes estimates on similar schemes. 
The  study  provided  a  ‘conservative’  estimate  that  1.5  million  jobs  could  have  been  created  with  the 
budget lost by national authorities. Starting from the average revenue loss of EUR 173 billion, assuming 

19 

 
                                                            
 
Moreover,  aggressive  tax  arrangements  have  in  certain  cases  other  elements  of  criminality. 
Europol89 examined the link between the use of offshore schemes and criminality and found 
3469 probable matches to organised crime and other criminal activities in the Panama Papers 
database. It also found 516 names linked to organised criminal gangs, 388 names connected to 
VAT  fraud  operations  and  116  names  linked  to  suspicion  of  terrorist  activities  in  Europe. 
Many of these schemes are used for money laundering. 

Tax  authorities  often  find  it  challenging  to  detect  tax  schemes  amounting  to  evasion  or 
avoidance. These  are  usually  structured in  several steps and, in  most  cases  the discovery  of 
one step would not allow the authorities to substantiate the existence of an infringement of the 
law or of tax avoidance. The cross-border dimension of many such schemes complicates the 
situation and reduces tax authorities' chances of unilaterally uncovering violations of the law, 
other breaches or harmful elements. As a result, evasion and avoidance can remain undetected 
or may be revealed with such delay that the authorities can no longer react.  

The  Commission  has  recently  proposed  rules  to  improve  transparency  and  the  exchange  of 
information in the field of taxation90 and to create a fairer corporate tax environment within 
the EU91. These initiatives are expected to reinforce the integrity and strengthen the level of 
protection of the internal market against practices that distort competition.  

Recent  scandals  such  as  the  “Panama  Papers”,  the  “Paradise  Papers”  and  “Luxleaks”  have 
shown that whistleblowers can bring substantial volumes of cases of tax evasion or avoidance 
to the knowledge of the tax authorities and beyond. Moreover, empirical evidence shows the 
effect  of  whistleblowing  in  deterring  the  criminal  use  of  offshore  banking  services  and  the 
resulting  tax  evasion.  A  2017  study  investigated  the  effect  of  the  leaks  of  customer 
information from banks in tax havens on the stock prices of banks that are known to provide 
such  services.  Its  findings  suggest  that  such  a  leak  lowered  market  expectations  about  the 
future  earnings  of  tax  haven  banks  that  assist  foreign  customers  with  tax  evasion.  Thus,  an 
increase  in  the  perceived  probability  of  a  leak  should  be  expected  to  deter  the  demand  and 
supply of criminal offshore banking services92. 

EU  whistleblower  protection  would  therefore  be  a  complementary  tool  to  increase  Member 
States'  effectiveness  in  identifying  evasive  and/or  abusive  schemes  that  could  otherwise  go 
undetected  and  would  help  deter  such  schemes,  thus  overall  contributing  to  ensuring  the 
proper functioning of the internal market. 

(iii)  Environmental protection 

89 

90 

91 

92 

an  average  of  EUR  50,000  cost  per  job  and  1:1  basis  into  government  expenditure  to  create  jobs  an 
additional 3.5 million jobs could have been created with the lost revenue. 
https://www.publicintegrity.org/2016/12/01/20500/panama-papers-have-had-historic-global-effects-and-
impacts-keep-coming,https://www.publicintegrity.org/2016/12/01/20500/panama-papers-have-had-
historic-global-effects-and-impacts-keep-coming; 
https://www.theguardian.com/news/2016/dec/01/panama-papers-europol-links-3500-names-to-suspected-
criminals; http://www.europarl.europa.eu/cmsdata/111503/Riondet%20Europol%20QA%20edited.pdf  
Council Directive 2011/16/EU of 15 February 2011 on administrative cooperation in the field of taxation 
and repealing Directive 77/799/EEC(as amended). 
Council Directive (EU) 2016/1164 of 12 July 2016 laying down rules against tax avoidance practices that 
directly affect the functioning of the internal market (as amended); Proposal for a Council Directive on a 
Common Consolidated Corporate Tax Base, COM/2016/0683 final - 2016/0336; Proposal for a Council 
Directive on a Common Corporate Tax Base, COM/2016/0685 final - 2016/0337. 
Johannesen, N, and Stolper, T.B.M., (2017), The deterrence effect of whistleblowing – an event study of 
leaked customer information from banks in tax havens,  http://voxeu.org/article/deterrence-effect-
whistleblowing 

20 

 
                                                                                                                                                                                          
In  order  to  achieve  effective  protection  of  the  environment,  the  EU  legislator  introduced 
dissuasive penalties for environmentally harmful activities, which typically cause or are likely 
to  cause  substantial  damage  to  the  air,  including  the  stratosphere,  to  soil,  water,  animals  or 
plants,  including  to  the  conservation  of  species.  In  2008,  the  EU  adopted  legislation 
establishing common rules on criminal offences and made it possible to use effective methods 
of investigation and assistance within and between Member States. Despite these regulatory 
efforts, undetected malpractices affecting the protection of the environment in the territory of 
the EU remain a challenge93. These are linked to persistent environmental problems, such as 
diffuse water pollution, poor urban air quality, unsatisfactory waste treatment, and species and 
habitats  in  decline.  There  is  also  a  serious  incidence  of  environmental  crime94  and  a  high 
number  of  environmental  complaints  to  the  Commission95  and  petitions  to  the  European 
Parliament. The costs of non-implementation are estimated at 50 EUR billion per year96. 

In the area of the EU waste legislation, illegal trade in waste may account for 10-15% of the 
EU market in waste and violations of waste management legislation accounted, in 2015, for 
20%  of  EU  environmental  infringement  cases97.  Examples  of  breaches  include  non-
compliance of waste facilities with waste permit conditions (e.g. receiving more waste than is 
permitted  or  different  kinds  of  waste  than  are  permitted)  or  illegal  waste  shipments,  often 
under cover of misleading or falsified documentation98.  

Moreover, as evidenced by past environmental accidents, weaknesses in enforcement of EU 
law in one Member State may also have a ricochet effect in the protection of the environment, 
which negatively affects several territories of the EU. The industrial pollution caused by the 
ILVA steel plant in Italy (one of the largest in Europe)99 had direct impacts on the mortality 
rate related to cancer and respiratory diseases in the area100.  

In  January  2018,  the  Commission  acknowledged  that  evidence-gathering,  detecting  and 
addressing  environmental  crimes  remains  a  challenge  and  needs  to  be  supported  and 
reinforced.  It  thus  launched  specific  measures  to  help  national  authorities  promote,  monitor 
and enforce compliance with EU rules on activities that can cause environmental harm101. 

93 

94 

95 

96 

97 

98 

99 

100 

101 

Implementation  Review  http://ec.europa.eu/environment/eir/country-

Commission  Environmental 
reports/index_en.htm. 
Combined estimates from the OECD, the UN Office on Drugs and Crime, UNEP and INTERPOL on the 
monetary value of all environmental crime show that it is the 4th largest international crime.  
According  to  the  report  of  the  2018  Commission  Communication  on  EU  actions  to  improve 
environmental compliance and governance, the number of complaints per year is around 600 or higher. 
http://ec.europa.eu/environment/legal/pdf/COM_2018_10_F1_COMMUNICATION_FROM_COMMISS
ION_TO_INST_EN_V8_P1_959219.pdf  
http://ec.europa.eu/environment/enveco/economics_policy/pdf/report_sept2011.pdf  .  The  cost  elements 
include,  amongst  others,  environmental  and  health  costs,  unrealized  benefits  in  the  green  industries, 
market distortions and administrative costs for industry. 
http://efface.eu/sites/default/files/publications/PB%203%20Case%20Study%20Policy%20Brief%20-
%20Waste%20-%20UniRoma.pdf  
The  “Land  of  Fires”  case  in  Campania  (Italy)  is  an  example  of  the  illegal  dumping  of  toxic  waste 
perpetrated 
crime, 
and 
http://efface.eu/sites/default/files/publications/EFFACE_synthesis-report_final_online.pdf 
The  plant  has  not  always  been  fully  compliant  with  health  and  safety  and  environmental  regulations, 
releasing  pollutants  with  environmental  impacts  on  the  air,  soil  and  water  as  well  as  on  the  health  of 
workers and people living in the area and leading to action by Italian authorities and the Commission.  
Lucifora, A., Bianco, F., Vagliasindi, G.M., (2015), Environmental and corporate miscompliance: A case 
study on the ILVA steel plant in Italy. 
These  actions,  which  will  be  implemented  over  2018-2019,  aim  to  help  inspectors  and  law  officers  to 
combine  forces,  encourage  professional  training  and  improve  information  to  Member  States  and 
practitioners. http://ec.europa.eu/environment/pdf/19_01_2018_news_en.pdf  

organised 

1990s 

1980s 

the 

by 

in 

21 

 
                                                            
The EU legislator had already considered whistleblower protection as a factor contributing to 
better enforcing EU sectorial rules on environment102, but the introduction of such protection 
appears  necessary  to  ensure  effective  enforcement  of  the  majority  of  the  EU  environmental 
acquis, whose violations can cause serious harm to the public interest.  “Dieselgate” showed 
that the lack of whistleblower protection in a single Member State103 can have cross-cutting 
and wide-ranging consequences  across the EU, including on the environment and  on public 
health – with studies calculating, for instance, that excess emissions from rigged diesel cars 
cause about 5,000 premature deaths annually across Europe104. 

(iv)   Nuclear safety 

Ensuring that Europe has the highest standard of nuclear safety has been a key policy priority 
of  the  Union.  Europe  has  adopted  in  recent  years  one  of  the  most  advanced  nuclear  safety 
regulatory frameworks in the world. While implementation and supervision remains largely at 
national  level,  the impacts  of  nuclear  accidents  are  of  cross-border  nature.  Recent accidents 
outside Europe and reports concerning breaches of standards have weaken public confidence 
in the sector.  

Whistleblower protection is therefore an important tool that would contribute to support the 
prevention and deterring of breaches of Euratom rules on nuclear safety, radiation protection, 
responsible and safe management of spent fuel and radioactive waste. The application of the 
enhanced  whistleblower  protection  in  the  field  of  nuclear  safety  and  radiation  protection 
would  be  complementary  to  the  robust  existing  provisions  of  the  revised  Nuclear  Safety 
Directive  on  the  effective  nuclear  safety  culture,  and  in  particular  Article  8  b  (2)  (a)  which 
requires that the competent regulatory authority and the licence holder to take measures that 
include  in  particular,  management  systems  which  give  due  priority  to  nuclear  safety  and 
promote, at all levels of staff and management, the ability to question the effective delivery of 
relevant safety principles and practices, and to report in a timely manner on safety issues.  

Protecting whistleblowers in the area of nuclear safety would help avoiding situations where 
there  are  delays  in  the  reporting  of  malpractices,  including  defects  in  the  assembly  of  key 
components for the nuclear power plants' safety and safeguards obligations. Delays would be 
avoided  if  employees  were  certain  of  being  protected  against  sanctions  and/or  retaliation 
when  exposing  bad  practices  as  soon  as  they  hear  about  them.  Moreover,  enhanced 
whistleblower  protection  in  this  area  would  also  increase  the  trust  of  the  general  public 
against on the robustness of the safety measures established in Europe.  

(v) 

Product safety, consumer protection, public health 

According to EU legislation, only safe products can be placed into the EU internal market105. 
Businesses must only place products which are safe on the market, inform consumers of any 
risks associated with the products they supply and make sure any dangerous products present 
on  the  market  can  be  traced  so  they  can  be  removed  to  avoid  any  risks  to  consumers.  The 

102 

103 

104 
105 

The Directive on safety of offshore oil and gas operations underlines the importance of establishing and 
encouraging adequate means for confidential reporting and the protection of whistleblower to ensure that 
no safety concerns are overlooked or ignored, in order to reduce the occurrence of major accidents. This 
increases the protection of the marine environment and coastal economies against pollution. 
The case was reported by researchers to US authorities, while investigations point to the fact that internal 
reporting was made but not-followed up. 
https://phys.org/news/2017-09-dieselgate-deaths-europe-year.html#jCp 
Directive  2001/95/EC  of  the  European  Parliament  and  of  the  Council  of  3  December  2001  on  general 
product safety. 

22 

 
                                                            
Commission  keeps  a  list  of  dangerous  products  found  across  Europe  and  information  is 
collected  in  the  Rapid  Alert  System,  which  facilitates  the  rapid  exchange  of  information 
between the national authorities of 31 countries and the Commission on dangerous products 
found on the market. If a manufacturer or distributor finds out that one of their products  on 
sale  is  dangerous,  they  have  to  inform  the  competent  national  authority.  Moreover,  product 
safety is ensured through EU instruments on manufacturing of products106. 

Hence, the primary source of evidence-gathering on safety of products is mainly businesses, 
complemented  by  the  investigations  and  audits  of  competent  enforcement  authorities. 
Information  coming  from employees and suppliers in the area of product safety has, thus, a 
high  added  value,  since  they  are  much  closer  to  the  source  of  possible  unfair  and  illicit 
manufacturing,  import  or  distribution  practices  of  non-compliant  products.  Yet,  there  is 
insufficient reporting in relation to non-compliant products and unfair practices by companies 
that  knowingly  undercut  EU  product  rules107  posing  risks  to  human  life.  To  date,  still  too 
many non-compliant products are placed on the EU market. 78% of respondents in the public 
consultation  on  the  internal  market  for  goods  considered  that  this  is  because  of  companies' 
deliberate  choice  to  exploit  market  opportunities  at  lowest  costs,  33%  ranked  this 
unwillingness to comply even as the main reason for the high non-compliance rates observed.  

An area where lack of enforcement on product safety has proven dangerous to human beings 
is car manufacturing. In 2009, following a fatal accident with a Lexus sedan in the US, Toyota 
issued  several  recalls,  assuring  customers  that  it  was  addressing  the  “root  cause".  The 
automaker later admitted that it had been concealing and minimising related problems108. The 
Dieselgate is another example of how car manufacturing malpractices can have high monetary 
and non-monetary impacts on society. 

Malpractices in the production of medical devices have also been reported as generating high 
risks to human health. A product safety scandal that came to light in 2010 concerned a French 
company that had made breast implants with industrial-grade silicone which had doubled the 
rupture  rate  of  other  implants  and  could  cause  medical  problems.  Press  reports  suggest  that 
about 300,000 women in as many as 65 countries were affected109.  

The  role  of  whistleblowing  in  strengthening  enforcement  of  rules  in  product  safety  was 
clearly acknowledged in the United States, where in the wake of the scandals over lead paint 
found in toys and other toy recalls, the Consumer Product Safety Act was amended, amongst 
others, to include whistleblower protections110. 

Whistleblower protection is also necessary to enhance the enforcement of EU rules related to 
marketing  and  use  of  sensitive  and  dangerous  products,  including  firearms,  explosives 
precursors and defence-related products111. In particular it could address the fraudulent intra-

106 

107 

108 
109 
110 
111  

on 

EU 

product 

addressed 

legislation 

requirements 

to  manufacturers: 

See  wide 
https://ec.europa.eu/growth/single-market/ce-marking/manufacturers_en  
Contribution to the public consultation on the Internal market for goods – Compliance and Enforcement 
initiative  to  reduce  the  number  of  non-compliant  products  in  the  Single  market,  November  2016, 
IndustriAll trade Union, see also: https://news.industriall-europe.eu/Article/64  
http://www.nytimes.com/2010/09/19/business/19autos.html  
http://www.bbc.com/news/health-16391522  
https://www.kmblegal.com/resources/consumer-product-safety  
Council Directive 91/477/EEC on control of the acquisition and possession of weapons; Regulation (EU) 
No 258/2012 implementing Article 10 of the United Nations’ Protocol against the illicit manufacturing of 
and  trafficking  in  firearms,  their  parts  and  components  and  ammunition,  supplementing  the  United 
Nations  Convention  against  Transnational  Organised  Crime  (UN  Firearms  Protocol),  and  establishing 

23 

 
                                                            
 
communitarian  acquisition  of  defence-related  products,  weapons  and  firearms  where 
violations often imply a diversion from the legal to the illegal market. The point of diversion 
originates  in  the  legal  market:  illicit  acts  such  as  an  armourer  who  would  irregularly 
deactivate  weapons  or  who  would  provide  a  fake  deactivation  certificate,  a  trader  making 
false  declarations  of  export  or  a  gun  or  sport  shop  submitting  a  falsified  authorisation  to 
acquire weapons when buying firearms in another Member State. It tends to be facilitated by 
corruption,  forged  documents,  poor  regulation,  monitoring  or  enforcement  and  appropriate 
export control. Persons who acquire insider information about such violations in their work-
related  context  can  facilitate  the  work  of  specialised  investigators  in  this  area  and  more 
generally help detect and prevent such violations.  

Another area where lack of enforcement relates to product safety and public health is the area 
of  tobacco  products.  While  EU  legislation  is  in  place,  shortcuts  in  prevention  of  fraud  are 
persistent.  Fraud  and  illicit  trade  in  cigarettes112  evidences  insufficient  enforcement  of  EU 
legislation on excise duties in tobacco products113 but also negatively affects the compliance 
with the EU Tobacco directive aimed at ensuring the proper functioning of the internal market 
for  tobacco  and  related  products,  while  ensuring  a  high  level  of  health  protection114.  At  the 
same  time,  the  annual  EU-wide  tax  loss  due  to  cigarette  smuggling  is  estimated  to  be 
approximately 11.3 billion euros relating to a loss in the EU excise duties115. 

In the pharmaceutical area, whistleblowers play an important role in unmasking violations and 
supporting enforcement. There have been cases where health care professionals revealed that 
pharma  companies  falsified  manufacturing  protocols,  did  not  comply  with  clinical  trial 
requirements, infringed advertising rules or provided payments to doctors. Some inspections 
of pharmaceutical companies or of their suppliers have been taking place on the basis of such 
information. A relevant example of whistleblowing was the disclosure, in 2009, of problems 
with Mediator, a weight-loss drug, the use of which led to the death of at least 500 people and 
to cardiovascular problems for thousands more people in France116. The public revelation by a 
doctor of the gravity of the Severe Acute Respiratory Syndrome (SARS) virus in 2003 is an 
example  of  whistleblowing  that  potentially  saved  millions  of  lives.  According  to  the  World 
Health Organization, the SARS outbreak led to 8,098 cases and 774 deaths117. 

Since  2013,  the  European  Medicines  Agency  (EMA)  has  received  43  reports  on  various 
issues,  from  the  manufacturing  of  medicines  to  the  conduct  of  clinical  trials118.  To  further 
encourage  such  reports  about,  among  other,  pharmaceutical  malpractices,  EMA  adopted  in 
2017 an internal  policy on handling the information  received by external  sources disclosing 
improprieties that may have an impact on the authorisation, supervision and maintenance of 
medicinal  products  in  the  area  of  EMA  activities119.  This  policy  aims  to  complement  the 

export  authorisation,  and  import  and  transit  measures  for  firearms,  their  parts  and  components  and 
ammunition. 
Data retrieved from Euromonitor International: (2015). “Tobacco Industry Illicit Trade Penetration”.  
Council  Directive  2011/64/EU,  of  21  June  2011,  on  the  structure  and  rates  of  excise  duty  applied  to 
manufactured tobacco. 
Directive 2014/40/EU on the approximation of the laws, regulations and administrative provisions of the 
Member States concerning the manufacture, presentation and sale of tobacco and related products. 
http://eur-lex.europa.eu/legal-content/en/TXT/?uri=CELEX:52013SC0274  
https://www.legifrance.gouv.fr/affichJuriJudi.do?idTexte=JURITEXT000032450774   
OECD (2016), Committing to Effective Whistleblowers Protection, 
http://www.oecd.org/corporate/committing-to-effective-whistleblower-protection-9789264252639-en.htm  
https://www.raps.org/regulatory-focus%e2%84%a2/news-articles/2017/4/ema-board-adopts-new-policy-
on-whistleblowing 
http://www.ema.europa.eu/docs/en_GB/document_library/Other/2017/03/WC500224494.pdf  

112 
113 

114 

115 
116  
117 

118 

119 

24 

 
                                                                                                                                                                                          
 
existing policy on whistleblowing  applying to  EMA staff. One of the policy principles  is to 
ensure confidentiality of information from external sources and protection of personal data.  

(vi) 

Food and feed safety and animal health and welfare 

the  valuable  role  of  whistleblowers 

While  the  General  Food  Law  Regulation120  has  been  found  to  have  achieved  its  core 
objectives, namely a high level of protection of human life and consumers' interests in relation 
to  food  and  the  effective  functioning  of  the  internal  market,121  there  are  still  national 
differences  in  the  implementation  and  enforcement  of  the  EU  legislative  framework.  Past 
experience  has  demonstrated 
in  strengthening 
enforcement  in  the  area  of  food  chain.  In  2016,  the  Commission  became  aware  through 
whistleblowers of illegal practices in the tuna sector and immediately launched several actions 
including through the EU Food Fraud Network. In the cases of contamination of eggs and egg 
products with fipronil in 2017, first information concerning the suspicion of fraud at the root 
of  the  incident  was  communicated  by  a  whistleblower  to  a  national  food  safety  service122. 
Examples  of  retaliation  for  whistleblowing  have  also  been  documented.  For  example,  in 
Germany,  a  truck  driver  gave  information  to  the  police  about  the  transport  of  rotten  meat, 
uncovering  one  of  the  biggest  scandals  of  its  kind.  He  was  presented,  in  2007,  with  the 
Golden Badge for Moral Courage by the Federal Minister for Agriculture but he still lost his 
job123. 

The  added  value  of  whistleblower  protection  in  this  area  has  been  documented  by  some 
Member  States.  The  UK  Food  Standards  Agency,  for  example,  reported  that  in  2012  it  had 
handled  81  cases  originating  from  whistleblowers,  a  marked  increase  from  the  54  cases 
received in 2011, which was largely due to improved procedures for receiving reports124.  

Animal  health  and  welfare  is  another  area  where  protection  of  whistleblowers  is  key  to 
detection  and  prevention  of  violations  of  EU  law  with  high  negative  consequences.  For 
example, during the1990s in Germany, the veterinarian who publicly disclosed the symptoms 
in  cattle  that  suggested  animals  had  the  Bovine  spongiform  encephalopathy,  a  neuro-
degenerative  fatal  brain  disease  that  may  be  passed  to  humans  by  infected  meat  (the  “mad 
cow disease”) lost her job. Her internal reporting was ignored and the infected meat entered 
into  the  food  chain125.  Cases  of  severe  breaches  of  animal  welfare  rules  are  also  typically 
revealed by “insiders” who witness such malpractice126. 

120  

121  

Regulation (EC) No 178/2002 of the European Parliament and of the Council of 28 January 2002 laying 
down  the  general  principles  and  requirements  of  food  law,  establishing  the  European  Food  Safety 
Authority and laying down procedures in matters of food safety, (OJ L 31, 1.2.2002, p.1). 
Commission  Staff  Working  Document,  "The  REFIT  evaluation  of  the  General  Food  Law  (Regulation 
(EC) No 178/2002)", SWD(2018)38 final, dated 15.1.2018. 
https://ec.europa.eu/food/safety/rasff/fipronil-incident_en 
http://www.dw.com/en/whistleblowers-in-germany-loved-hated-poorly-protected/a-19228525 
https://www.food.gov.uk/sites/default/files/multimedia/pdfs/incidents-report-2012.pdf  

122 
123 
124 
125   Deiseroth, D. (2001): “Whistleblowing in Zeiten von BSE: der Fall der Tierärztin Dr. Margrit Herbst” 
126 

For example, in February 2018, Belgian supermarket chains stopped deliveries from a Spanish pork giant 
shocking  animal  abuse  http://www.independent.co.uk/news/uk/home-
following 
news/morrisons-amazon-uk-spanish-sausages-el-pozo-pigs-animal-equality-animal-welfare-farming-
a8195571.html; 
http://www.xpats.com/belgian-supermarkets-pull-ham-following-photos-animal-abuse; 
also  see  case  reported  in  France  on  violation  of  rules  on  space  and  sanitary  requirements, 
http://www.lemonde.fr/planete/article/2017/05/30/nouveau-scandale-sanitaire-dans-un-elevage-de-160-
000-poules-pondeuses_5135716_3244.html;  in  2018  in  Spain  a  case  of  animal  suffering  involving 
products, 
“deformed, 

producing  meat 

revelations  of 

diseased 

dying” 

centre 

pigs 

and 

in 

a 

25 

 
                                                            
 
(vii)  Transport safety 

In  the  area  of  transport  safety,  malpractices  that  remained  hidden  and  led  to  tragedies  have 
been  in  the  origin  of  the  development  of  national  and  EU  legislation  on  whistleblower 
protection.  For  example,  one  of  the  events  triggering  the  adoption  of  the  UK  law  was  the 
capsizing  in  1987  of  a  ferry  operating  between  Belgium  and  the  UK  with  the  loss  of  193 
passengers  and  crew,  where  the  official  inquiry  found  that  workers  knew  about  the 
malpractice that had contributed to the loss of the vessel but were either too scared to speak 
up or the concerns they had expressed had been ignored127.  

In  maritime  transport,  the  EU  has  progressively  developed  policies  of  the  safety  of  both 
passenger and merchant ships in response to several major shipping accidents since the 1990s. 
The EU has also prioritised work on effective aviation safety standards. Regulation 376/2014 
was  designed  to  ensure  a  high  level  of  safety  in  civil  aviation  by  introducing  reporting 
systems  and  providing  for  certain  measures  of  whistleblower  protection.  The  EU  has  also 
created  safety  agencies  dealing  with  the  different  transport  modes:  the  European  Aviation 
Safety Agency, the European Railway Agency and the European Maritime Safety Agency. 

Given  the  acknowledged  added  value  of  whistleblower  protection  in  preventing  transport 
safety  violations,  EU  whistleblower  protection  should  also  be  provided  in  other  transport 
modes,  such  as  road  and  railway  transport.  This  need  is  illustrated  by  investigations  on 
accidents at national level. For example, following the railway accident in 2016 in Croydon, 
UK, in which 7 people were killed and 19 seriously injured, the official investigation report 
found  that  drivers  had  failed  to  report  incidents  amongst  others  because  they  feared 
retaliation, and recommended encouraging a ‘just culture’ inside the organisation128. 

(viii)  Protection of privacy and personal data and security of networks 

Regulation  (EU)  679/2016  on  the  protection  of  personal  data  (General  Data  Protection 
Regulation,  'GDPR')129  and  Directive  2002/58/EC  on  the  protection  of  privacy  in  the 
electronic communications sector130 (so-called 'e-privacy Directive') protect the fundamental 
right to private life with regard to the processing of personal data. 

Despite the robust oversight system put in place by the Union legislation (i.e. through national 
data  protection  authorities  and  the  mandatory  presence  of  data  protection  officers  within 
public  authorities,  and  within  companies  in  certain  cases),  whistleblowers  remain  a 
particularly  valuable  source  of  information  to  unmask  certain  types  of  infringements  which 
are particularly harmful to the public interest - e.g. where the processing is likely to result in a 
high risk to the rights and freedoms of natural persons, or consists in regular and systematic 

127 

128  

129  

http://www.independent.co.uk/news/uk/home-news/morrisons-amazon-uk-spanish-sausages-el-pozo-pigs-
animal-equality-animal-welfare-farming-a8195571.html  
UK  Department  of  Transport,  mv  Herald  of  Free  Enterprise,  Report  of  Court  No.  8074,  Formal 
Investigation,  1987,  pp.  13-14,  www.maib.gov.uk/cms_resources.cfm?file=/hoffefinal.pdf.;  Public 
Concern  at  Work,  UK  Submission  to  Transparency  International  Whistleblower  Protection  Research 
Project (UK: January 2013), pp. 1, 15. 
The  report  of  the  Rail  Accident  Investigation  Branch  (RAIB)  available  at:  https://www.gov.uk/raib-
reports/overturning-of-a-tram-at-sandilands-junction-croydon  
Regulation  (EU)  2016/679  of  the  European  Parliament  and  of  the  Council  of  27  April  2016  on  the 
protection of natural persons with regard to the processing of personal data and on the free movement of 
such data, and repealing Directive 95/46/EC (General Data Protection Regulation), (OJ L 119, 4.5.2016, 
p. 1–88). 

130   Directive  2002/58/EC  of  the  European  Parliament  and  of  the  Council  of  12  July  2002  concerning  the 
processing of personal data and the protection of privacy in the electronic communications sector (OJ L 
201, 31.07.2002, p. 37–47). 

26 

 
                                                                                                                                                                                          
monitoring  of  data  subjects  on  a  large  scale,  or  consists  of  processing  on  a  large  scale  of 
“special  categories  of  data”  pursuant  to  Article  9  of  the  GDPR  (such  as  data  revealing 
political opinions, religious or philosophical beliefs, racial or ethnic origins, sex life or sexual 
orientations, etc.). 

The  recent  Cambridge  Analytica  scandal  shows  by  itself  the  scale  of  harm  to  the  public 
interest that breaches of the EU data protection rules (e.g. acquisition of data without consent 
of  the  –  tens  of  millions  -  individuals  concerned,  use  of  the  personal  data  for  a  different 
purpose  than  the  one  for  which  it  was  collected)  can  entail131.  The  scandal  came  to  light 
thanks to the revelations made to The Guardian and to The Observer by whistleblower who 
was a former Cambridge Analytica employee. 

As  to  the  security  of  networks,  the  ongoing  digital  transformation,  which  allows  both 
European  consumers  and  business  to  benefit  from  better  services  and  significant  cost-
reductions, poses as well new threats to the security of the European society and economy. A 
2016 study revealed that the number of security incidents across all industries rose by 38% in 
2015,  which  accounted  as  the  biggest  increase  since  2004,  while  at  least  80%  of  European 
companies have experienced at least one cybersecurity incident132.  
Directive  (EU)  2016/1148  on  the  security  of  network  and  information  systems133  (so-called 
'NIS Directive') is aimed at building EU resilience to cyber-incidents and better protecting the 
internal market. It promotes a culture of risk management by introducing incident notification 
and security requirements  for companies providing  essential services across many sectors134 
and  sub-sectors  (e.g.  energy,  health,  transport,  banking)  and  providers  of  key  digital 
services135.  

Whilst the Directive introduces the possibility for businesses to establish structural dialogues 
with  public  authorities  about  cyber-security  vulnerabilities136,  economic  operators  are  often 
reluctant to share potentially disruptive vulnerabilities and report significant incidents, due to 
the  concern  that  their  reputation  could  be  harmed  and  the  value  of  the  company  decreased. 
For  example,  in  2016  Yahoo  disclosed  that  three  years  before  a  data  breach  compromised 
more than 1 billion accounts. However, only one year after, Yahoo shared the actual size of 
the attack, revealing that the data theft affected 3 billion accounts137.  

For this reason, whistleblowers informing public authorities responsible for the enforcement of the 
NIS  Directive  about  cyber-malpractices,  unmanaged  vulnerabilities  or  significant  incidents  could 
facilitate a timely and complete sharing of information by companies. As a result: (i) private entities 
could be further incentivised to invest into securing their network and information systems; (ii) public 
authorities could contribute to incident response and risk mitigation in a more effective manner; (iii) 

131  

132  

The Trump campaign was allegedly able to harvest raw data from up to 87 million Facebook profiles to 
direct its messaging and influence voters. 
PWC,  Global  State  of  Information  Security  Survey,  2016  and  http://news.sap.com/pwc-study-biggest-
increase-in-cyberattacks-in-over-10-years/   

133   Directive  (EU)  2016/1148  of  the  European  Parliament  and  of  the  Council  of  6  July  2016  concerning 
measures for a high common level of security of network and information systems across the Union 
134   Annex  II  of  the  NIS  Directive  covers  entities  active  in  the  sectors  of  electricity,  oil,  gas  provision,  air 
transport, rail transport, water transport, road transport, banking, financial market infrastructures, health 
sector, drinking water supply and distribution, digital Infrastructure.  

135   Annex  III  of  the  NIS  Directive  covers  entities  providing  online  marketplace,  online  search  engine  and 

cloud computing service. 
For instance, by enabling operators to voluntary notify cyber-security incidents. 
https://www.nytimes.com/2017/10/03/technology/yahoo-hack-3-billion-users.html  

136  
137  

27 

 
                                                            
public  authorities  could  acquire  a  more  comprehensive  overview  of  risks  and  incidents  hampering 
the economy and take appropriate counter-measures.  

2.5.3.  Areas where the case for introducing EU whistleblowing rules as an enforcement tool 
of EU law could be made in the future – need for "future-proof" EU action 

The  present  identification  of  EU  acts  and  areas  where  the  introduction  of  whistleblower 
protection appears necessary is based on currently available evidence. It is possible that, in the 
future,  evidence  comes  to  the  fore  substantiating  the  need  for  whistleblower  protection  as  a 
means of strengthening the enforcement of EU law also in other EU areas or legislative acts 
(including future acts).  

For this reason, any EU action should be “future-proof”, e.g. it should allow for flexibility in 
this regard, providing for a review process. 

2.6 

Baseline scenario  

Maintaining the status quo would entail no new action taken at EU level. EU Member States 
would  be  the  primary  source  of  protection  of  whistleblowers  and  the  existing  sectorial 
instruments of EU law as implemented. Any improvements would be left to the discretion of 
the  Member  States.  The  Commission  would  pursue  the  monitoring  of  the  transposition  and 
the enforcement of existing sectorial rules; continue monitoring the developments at national 
level in the context of the EU Semester and continue supporting research and promoting the 
exchange of good practices.  

As illustrated in the subsection 2.4.B above, gaps in national protection and legal uncertainty 
resulting from fragmentation and divergence of protection across the EU persist and are not 
addressed  in  a  satisfactory  way  by  the  existing  EU  or  national  rules  on  protection  of 
whistleblowers.  

Some  of  the  gaps  in  protection  identified  are  expected  to  be  addressed  in  the  future,  as  a 
number  of  Member  States138  are  currently  considering  adopting  legislation  with  a  view  to 
introducing or improving whistleblower protection.  

However, in the absence of any EU action guaranteeing minimum harmonisation across the 
Member  States,  it  is  likely  that  reforms  in  the  Member  States  will  be  incomplete  and 
uncoordinated,  maintaining  the  current  uneven  level  of  protection  and  divergences  between 
countries,  as  well  as  legal  uncertainty.  As  illustrated  by  recent  unsuccessful  attempts  to 
introduce new rules on whistleblower protection in various Member States139, it is not certain 
that all envisaged reforms  will succeed. Secondly,  the scope and impact of the reforms will 
vary. In some cases, the draft legislation, if adopted, will result in comprehensive coverage of 
both  the  public  and  the  private  sector.  In  other  cases,  however,  the  draft  proposals,  even  if 
adopted, may not result in major changes or protection would still be provided on an ad hoc 
basis through piecemeal provisions within one or more laws140.  

The transposition and implementation by Member States of sectorial EU law introducing rules 
on whistleblower protection might have a spill-over effect resulting in the setup of reporting 

138  

139  
140  

The Member States currently in the process of preparing legislation/amending their existing one: BE, BG, 
CZ, HR, EL, ES, LV, PL and SK. 
Recent attempts to adopt new legislation in Bulgaria, Denmark and Germany were unsuccessful.  
For instance, the amendments to the Belgian Federal law on Integrity and Ethics currently pending before 
the parliament would only extend the personal scope of the law–which only applies to public servants – to 
the police sector. 

28 

 
                                                            
channels  or  provision  of  protection  also  in  other  areas  not  covered  by  these  instruments. 
However, there are no indications about the likelihood of such a development.  

Hence, under the baseline scenario, due to the increase of the national sectorial legislation in 
the  next  5  years,  the  number  of  employers  in  the  EU  that  provide  whistleblower  support 
(including reporting channels) to their employees on a voluntary basis is expected to increase 
between 5% and 15% in the next 5 years141.  

In summary, even if in the medium short-term Member States are expected to further develop 
legislation due to national developments or transposition of EU law, there is still a clear risk 
that those Member States which do not have effective complete frameworks of protection in 
place will not remedy the drivers described in the section above. Protection provided in law to 
whistleblowers would not be consistent across Europe, and would not effectively achieve the 
objectives of combating under-reporting and fear of retaliation.  

In terms of protection of the financial interests of the Union, in absence of a reinforced system 
of  protection  of  whistleblowers,  the  ‘VAT  gap’  (among  other  loss  in  EU  revenues),  in  the 
Member States, is estimated to amount to EUR 175 billion in 2017 and is expected to rise to 
EUR 217 billion by 2027.  

As ancillary negative effect, businesses operating in several EU countries would continue to 
experience unfair competition due to insufficient enforcement.  

3. 

NEED FOR ACTION AT EU LEVEL 

3.1 

Subsidiarity: why is the EU better placed to take action? 

The rationale for an EU initiative aimed at reinforcing whistleblower protection would be to 
improve enforcement of EU law so as to enhance the proper functioning of the internal market 
and the implementation of certain EU policies and to safeguard the financial interests of the 
Union  and  the  EU  budget  at  large.  Section  2  evidences  that  the  existing  whistleblower 
protection at  national  and  EU  level  is  not  sufficient  to  address  underreporting  as  one  of  the 
causes of weak enforcement of EU law. Currently most Member States offer protection only 
in  a  piecemeal  way  and  the  level  of  protection  varies.  The  protection  at  EU  level  is  also 
limited, as existing rules only apply to specific sectors and offer limited protection.  

Insufficient protection of whistleblowers in a given Member State can have a negative impact 
on the functioning of various EU policies in that Member State, but also spill-over impacts in 
other Member States, as set out in section 2.2. The following table summarises the strength of 
potential spill-over impacts of insufficient enforcement in the areas identified as necessitating 
the introduction or the strengthening of whistleblower protection.  

Table 3.1 Strength of spill-over impacts of breaches of Union law 

Areas 

Strength of spill-over impacts in other Member States 

Protection 
interests of the Union 

of 

financial 

Very strong, as the revenues and expenditure of the Union itself are affected.  

Proper  functioning  of  the 
internal market 

Public procurement and competition rules: strong, given resulting distortions 
of  competition  in  the  single  market,  increase  in  costs  for  doing  business, 

29 

 
 
                                                            
 
violation  of  the  interests  of  investors  and  shareholders,  decrease  of 
attractiveness for investment. 

Financial  services  including  prevention  of  money  laundering  and  terrorist 
financing: strong, given negative impacts on safety, stability and integrity of 
financial markets and security. 

Aggressive tax planning schemes: strong, as aggressive tax planning schemes 
give rise to unfair tax competition, distorting the level-playing field between 
companies or amongst Member States and resulting in loss of tax revenues for 
Member States and for the EU budget as a whole. 

Environmental 
and nuclear safety 

protection 

Strong,  given  that  risks  to  the  health  of  citizens  and  the  environment  go 
beyond national borders.  

Product  safety,  food  safety, 
animal  health  and  welfare, 
consumer  protection 
and 
public health 

Strong,  given  that  related  risks  go  beyond  national  borders  due  to  free 
movement of goods within the single market. 

Transport safety 

Strong,  given  that  related  risks  go  beyond  national  borders  due  to  free 
movement of persons and goods within the single market. 

Protection  of  privacy  and 
personal data and security of 
network  and 
information 
systems 

Strong,  given  that  related  risks  go  beyond  national  borders  due  to  free 
movement of data in a digital single market. Given the inter-connections in the 
current digital landscape, also threats from cyber-incidents can affect entities 
providing essential services across the EU and the damage the EU society and 
economy overall.  

While,  as  described  under  the  baseline  scenario,  the  situation  in  some  Member  States  is 
expected  to  improve,  gaps  and  unevenness  of  protection  will  persist,  as  even  these 
improvements  will  be  limited  to  certain  areas  or  types  of  wrongdoing,  leading  to  different 
types and levels of protection from one Member State to the other. This means that the cross-
border  impacts  will  also  persist.  It  is  therefore  clear  that  only  EU  action  can  address 
unevenness of protection, ensuring a consistent high level of protection across the EU.  

Also  as  regards  the  protection  of  financial  interests  of  the  Union,  it  is  clear  that  fraud  and 
illegal  activities  affecting  them  cannot  be  dealt  with  by  Member  States  acting  alone.  The 
Treaty  itself  presumes,  in  Articles  310(6)  and  325(1)  and  (4)  TFEU,  the  necessity  of  EU 
legislative  action  for  setting  out  equivalent  and  deterrent  measures  to  protect  EU  financial 
interests against illegal activities. Hence, EU action is warranted. 

For  the  above  reasons,  the  improvement  of  enforcement  of  EU  law  cannot  be  sufficiently 
achieved  by  Member  States  acting  alone  or  in  an  uncoordinated  manner.  This  can  only  be 
achieved  by  action  at  EU  level,  providing  minimum  standards  of  harmonisation  on 
whistleblower  protection.  Moreover,  only  EU  action  can  provide  coherence  and  align  the 
existing EU sectorial rules on whistleblower protection.  

3.2 

Legal bases 

As  indicated  above,  there  is  no  legal  basis  in  the  Treaties  specifically  allowing  the  EU  to 
regulate whistleblower protection in general.  

In particular, an initiative based on the protection of fundamental rights, notably freedom of 
expression, cannot be pursued since the EU Charter of Fundamental Rights cannot serve as a 

30 

 
standalone legal basis142. Moreover, although fraud and corruption are rather common types 
of violations of EU law which cause harm to the public interest in key policy areas and have 
clear spill-over impacts in terms of hampering the proper functioning of the internal market, 
the fight against those type of violations has no self-standing legal basis in the Treaties.  

However,  certain  Treaty  articles  can  serve  as  legal  basis  for  instruments  aimed  at 
strengthening whistleblower protection as a means of improving the enforcement of EU law: 
Articles 292, 50, 325 and 114 TFEU143. Article 153(1)(a) and (b) TFEU could also be used to 
regulate  aspects  of  whistleblower  protection  relating  to  the  improvement  of  the  working 
environment to protect workers’ health and safety and to working conditions. The initiatives 
based on these Articles are summarised as follows:  

Table 3.2 Summary of the scope of the initiatives that could be based on available legal bases 

Type of 
initiative 

Focus of 
the 
initiative 

Personal 
scope 

Art. 292 TFEU 

Art. 50 TFEU 

Art. 114 TFEU 

Art 325 TFEU  

Art. 153 TFEU 

Non-regulatory  

Legislative 

Legislative  

Legislative 

Legislative  

Encourage  Member 
States 
to  protect 
whistleblowers 
across the board  

Protect  the  integrity 
of the private sector 
the 
through 
establishment 
of 
reporting channels 

of 

the 

proper 
Enhance 
functioning 
the 
internal  market  through 
the  establishment  of 
reporting  channels  and 
whistleblower 
protection 

Protect 
employees’  health 
and well-being  

Protect  the  financial 
interests  of  the  Union 
the 
through 
establishment 
of 
channels 
reporting 
and 
whistleblower 
protection  

Broad  definition  of 
workers:  employees 
and 
self-employed 
(contractors, 
suppliers, etc.) 

Limited  definition 
of 
workers: 
protection  granted 
only  to  employees 
stricto sensu  

definition 

Broad 
of 
workers: employees and 
self-employed 
(contractors,  suppliers, 
etc.) 

Broad  definition  of 
employees 
workers: 
and 
self-employed 
(contractors, 
suppliers, etc.) 

Limited  definition 
of 
workers: 
protection  granted 
only to employees 
stricto sensu 

Activity 
sectors 

Private  and  public 
sector 

Private sector 

Private 
sector 

and 

public 

Private  and  public 
sector  

Private and public 
sector  

Protected 
disclosures 

Violations  or  abuse 
of  EU  and  national 
rules 

Violations  or  abuse 
affecting  investors’ 
interests 

Violations  or  abuse  of 
EU  law  affecting  the 
proper  functioning  of 
the internal market 

Fraud 
illegal 
or 
activities affecting the 
financial  interests  of 
the Union  

Violations 
or 
abuse  of  EU  and 
national rules  

142   Nonetheless, any policy initiative to strengthen whistleblower protection is bound to have positive effects 
on  freedom  of  expression  as  well  as  on  the  respect  of  other  fundamental  rights,  in  the  context  of 
implementation of EU law 
For  a  specific  analysis  on  the  legal  bases,  see  Annex  9.  Depending  on  the  scope  of  application  of  the 
future initiative, they could be combined with Treaty articles related to other areas, such as Articles 16, 
33, 43, 50, 53(1), 62, 91, 100, 103, 109, 168, 169, 192 and 207 TFEU and the provisions of the Treaty 
establishing the European Atomic Energy   

143  

31 

 
 
 
 
 
                                                            
4. 

OBJECTIVES 

Objectives 

General     To address underreporting of breaches of EU law leading to serious harm to 
the  public  interest  in  areas  where  strong  whistleblower  protection  can 
significantly contribute to expose, prevent and deter such harm. 

Specific     To strengthen the protection of whistleblowers and avoid retaliation against 

them;  

  To provide legal clarity and certainty;  

  To  support  awareness-raising  and  fight  against  socio-cultural  factors 

leading to underreporting. 

The general objective (increasing the reporting rate of violations of EU law) will be achieved 
by  providing  legal  clarity  and  certainty  on  the  legal  framework  and  ensuring  effective 
protection against retaliation in all Member States. When compared to the baseline scenario, 
this  is  expected  to  lead  to  a  reduction  of  the  level  of  violations  of  EU  law,  as  more  illegal 
activities will be prevented, reported, investigated and prosecuted.  

The  general  objective  will,  in  turn,  have  ancillary  benefits  such  as  support  of  good 
governance, increase of businesses’ competitiveness, of transparency in the EU, as well as of 
protection of fundamental rights under the Charter. In this respect, any implementation of the 
general  objective  would  enhance  freedom  of  expression,  as  well  as  increase  reporting  and 
deterrence of fundamental rights violations within the implementation of EU law.  

5. 

POLICY OPTIONS 

5.1   Design of the policy options – Common minimum level of protection 

In light of the enforcement challenges identified in section 2, the main differences of design 
of  the  policy  options  revolve  around  the  material  scope  of  application,  e.g.  what  can  be 
reported  in  terms  of  violations  or  abuses  of  EU  law  that  would  trigger  the  protection  of 
whistleblowers.  

All the other elements, e.g. (1) personal scope, (2) obligation to establish reporting channels, 
(3) safeguards for the reporting and the reported persons, (4) measures against retaliation (5) 
measures to ensure the effectiveness of the framework for whistleblowers, are common to all 
the policy options.  

The rationale is that, besides establishing in which areas of EU law enforcement needs to be 
reinforced  by  whistleblower  protection,  all  policy  options  need  to  counter  the  drivers  of 
underreporting as established in Section 2. In particular: 

 

fear of retaliation is addressed by the measures of protection against retaliation. Some of 
these  are  aimed at preventing retaliation,  such as  the overall obligation to  set up a  clear 
legislative  framework  prohibiting  retaliation;  the  obligation  to  provide  for  internal  and 
external reporting channels; to guarantee confidentiality; to ensure access to information 
and  impartial  advice.  Others  are  targeted  to  the  situation  where  the  whistleblower  has 
already suffered retaliation and aim at providing as full a remedy as possible.  

32 

 
 
 

 

lack of knowledge of where and how to report is countered by the obligations to establish 
reporting channels and to ensure access to information and independent advice;   
the  sense  of  futility  that  has  a  dissuasive  effect  on  whistleblowers  is  addressed  by  the 
obligations imposed on national authorities to follow up on the reports and give feedback.  

Therefore, any policy option should promote or provide for minimum standards, ensuring that 
Member States introduce essential components of an effective and balanced legal framework 
that  protects  whistleblowers  who  genuinely  aim  to  safeguard  the  public  interest  whilst 
safeguarding the rights interests of persons that may be prejudiced by the reports.  

Accordingly, every policy option introduces the same common elements of protection based 
on the principles provided in the Council of Europe Recommendation144 and the ECtHR case-
law on freedom of expression enshrined in Article 10 ECHR, as well as further international 
standards and good practices145 and EU fundamental rights and rules (e.g. data protection)146. 

1.  Personal  scope  (Principles  3  and  4  of  the  CoE  Recommendation):  the  retained  options 
have a broad personal scope. They cover both the public and the private sector and grant 
protection both to workers in standard employment relationships as well as to part-time 
workers,  fixed-term  contract  workers  or  persons  with  a  contract  of  employment  or 
employment relationship with a temporary agency, and to a wider population of persons 
in  a  work-based  relationship,  such  as  self-employed  persons  providing  services, 
freelance,  contractors,  sub-contractors  and  suppliers,  given  that,  as  indicated  in  Section 
2.2, these broader categories can be key for exposing violations of the law and may suffer 
different forms of retaliation. Shareholders and persons in managerial bodies will also be 
included for the same reasons.  

The personal scope will also include further categories of reporting persons who do not 
rely  on  their  work-related  activities  economically  but  who  may  nevertheless  suffer 
retaliation,  such  as  volunteers  and  unpaid  trainees.  More  generally,  the  options  would 
ensure  that  the  need  for  protection  is  determined  by  reference  to  all  the  relevant 
circumstances and not merely by reference to the nature of the relationship, so as to cover 
the  whole  range  of  persons  connected  in  a  broad  sense  to  the  organisation  where  the 
breach has occurred, including in particular candidates for employment or for providing 
services to an organisation who acquired the information on breaches of law during  the 
recruitment process or other pre-contractual negotiation stage.  

2.  Obligation to establish reporting channels (Principles 12 to 17). Member States should:  

  ensure  that  private  entities  and  public  authorities  establish  internal  reporting 
mechanisms  (including  following  consultations  with  workers’  representatives  where 
appropriate),  meeting 
the  Council  of  Europe 
recommendation;  

the  requirements  set  out 

in 

  provide  for  external  reporting  channels  to  competent  national  authorities  or  the 

competent EU authority where relevant;  

144  

145  

Some of the principles contained in the Council of Europe Recommendation are not taken up, as they are 
not relevant for the EU legislator but rather addressed to the national ones (for instance, on providing a 
special scheme for reporting information related to national security – Principle 5 –). 
These include standards reflected in the UN Convention against Corruption, in the G20 Compendium of 
best practices and guiding principles for legislation on the protection of whistleblowers and in the OECD 
(2016) Report Committing to Effective Whistleblowers Protection. 

146   A  table  presenting  in  detail  the  correspondence  with  the  principles  of  the  Council  of  Europe 

Recommendation can be found in Annex 12. 

33 

 
                                                            
These  obligations  will  ensure  that  the  information  gets  to  those  people  most  able  to 
investigate and with powers to deal promptly with the problem. 

3.  Safeguards for the reporting and the reported persons (Principle 18), in particular: 

  ensuring the confidentiality of the data of the reporting person: reassuring workers that 
they  will  be  protected  may  not  always  be  enough,  thus  offering  confidentiality  can 
provide the added reassurance someone may need to speak up;  

  protection of the personal data of both the reporting and the reported person; 

  respect of the rights of defence of the reported person (including the right to access to 
the  file,  the  presumption  of  innocence,  the  right  to  be  heard  and  to  seek  effective 
remedy):  this  is  crucial  in  order  to  avoid  unfair  treatment  or  reputational  damages 
(Principle 10);  

  a  tiered  use  of  reporting  channels  (principles  14,  17  and  24):  the  reporting  persons 
should be required to first use the internal channels, i.e. report to their employer; only 
if  this  does  not  work  –  or  could  reasonably  not  be  expected  to  work  –  report  to  the 
competent  authorities,  and  only  as  a  last  resort  to  the  public/media.  This  safeguard 
aims to ensure that the information gets to the persons who can contribute to the early 
and effective resolution of risks to the public interest as well as to prevent unjustified 
reputational  damages  from  public  disclosures147.  At  the  same  time,  it  provides  the 
necessary  flexibility  for  the  reporting  person  to  choose  the most  appropriate  channel 
depending  on  the  individual  circumstances148  and  allows  for  the  protection  of  public 
disclosures  taking  into  account  democratic  principles  such  as  transparency,  and 
fundamental  rights  such  as  freedom  of  expression  and  media  freedom,  whilst 
balancing the interest of employers to manage their organisations and to protect their 
interests149 with the interest of the public to be protected from harm, in line with the 
criteria developed in the ECtHR case-law150; 

  to  enjoy  protection,  the reporting  persons  should  reasonably  believe the  information 
they  disclose  to  be  true  (Principle  22):  This  is  an  essential  safeguard  against 
malicious/abusive  disclosures,  ensuring  that  those  who  deliberately  and  knowingly 
report  false  information  do  not  enjoy  protection.  At  the  same  time,  it  ensures  that 
protection is not lost solely on the basis that the reporting person was mistaken as to its 

148  

147   Along these lines, the Parliamentary Assembly of the Council of Europe has asserted that there should be 
protection  from  penalty  for  public  disclosures  “where  internal  channels  either  do  not  exist,  have  not 
functioned  properly  or  could  reasonably  be  expected  not  to  function  properly  given  the  nature  of  the 
problem raised by the whistleblower”; Resolution 1729, adopted 29 April 2010, arts. 6.1.2, 6.2.3.  
The  Council  of  Europe  Recommendation  (Principles  8  and  17)  encourages  internal  reporting  and 
reporting to regulators, as they are the ones closest to the problem and best able to address it, but does not 
establish  an  order  of  priority  between  the  different  channels,  noting  that,  in  the  end,  the  individual 
circumstances of each case will determine the most appropriate channel. At the same time, according to 
Principle 24, where an employer has put in place an internal reporting system and the whistleblower has 
made a disclosure to the public without resorting to the system, this may be taken into consideration when 
deciding on the remedies or level of protection to afford to the whistleblower.  
Businesses and business associations taking part in the Commission’s OPC and Business Europe (in its 
position paper of 20 July 2017) argued strongly in favour of a tiered use of channels so that the employer 
has the opportunity to address the issue before any external disclosure.  
The criteria developed in this case law for determining whether retaliation against whistleblowers making 
public disclosures interferes with freedom of expression are: whether the person who made the disclosure 
had at his/her disposal alternative channels for making the disclosure; the public interest in the disclosed 
information; the authenticity of this information; whether the disclosure is made in good faith; detriment 
to the employer; the severity of the sanction imposed on the whistleblower and its consequences. 

149  

150  

34 

 
                                                            
import or that the perceived threat to the public interest has not materialised, provided 
he/she  had  reasonable  grounds  to  believe  in  its  accuracy;  in  a  similar  vein,  the 
reporting persons should be entitled to protection under an EU legislative initiative if 
they reasonably believe that the information they report falls within its scope. 

4.  Ensure the protection of reporting persons against retaliation  

  Remedial  measures  against  work-related  retaliation  (Principles  21  and  26):    It  is 
important  to  ensure  that  the  reporting  persons  have  at  their  disposal  legal  actions 
(“remedial  measures”)  which  provide  them  with  effective  access  to  legal  review, 
decision  and  remedy  for retaliation broadly  defined, e.g.  against  any act or  omission 
occurring in the work-based context which causes them detriment. 

As  mentioned  in  detail  in  Section  2.2,  retaliation  can  take  many  forms  and  varies 
depending on the legal nature of the work-based relationship. The appropriate remedy 
will be determined by the kind of retaliation suffered. Typical remedial measures (the 
types  of  remedy  will  vary  between  legal  systems)  include  actions  for  reinstatement, 
compensation  for  financial  loss,  award  of  damages.  Of  particular  importance  for 
whistleblowers  are interim remedies pending  the resolution of legal proceedings that 
can be protracted. These could be ordered by a court to stop threats or continuing acts 
of retaliation, or prevent forms of retaliation that might be difficult to reverse after the 
lapse of lengthy periods, such as dismissal, and that can ruin financially the individual;  

  reversal  of  burden  of  proof,  i.e.  in  a  prima  facie  case  of  retaliation,  the  person  who 
took  the  adverse  measure  against  the  reporting  person  carries  the  burden  to 
demonstrate that this was not related to the reporting (Principle 25); 

  prohibition  of  “gagging  clauses”:  no  term  or  clause  in  any  contract  or  agreement 
between individuals and the person or body for whom they are working can be relied 
on  to  preclude  them  from  reporting  or  penalise  them  for  having  done  so  (Principle 
11); 

  right of the reporting persons to rely on having made a report in accordance with the 
rules of the Directive as a defence in proceedings against them under civil, criminal or 
administrative  law,  for  instance  for  breach  of  confidentiality,  copyright,  data 
protection, defamation151 (Principle 23).  

It  should  be  kept  in  mind  that  the  choice  of  legal  remedies  is  based  on  the  specific 
risks faced by whistleblowers. Under certain national frameworks and in certain cases, 
there  are  administrative  processes  to  protect  and  compensate  reporting  persons 
suffering  retaliation152.  Notwithstanding  such  possibilities,  it  is  important  that 

151  

Such a defence is provided in the form of a “qualified privilege” in some Member States (ex. UK) whilst 
in others it is even given the title of a "whistleblower status” (ex. Greece). 

152   An  example  of  such  processes  is  Slovakia’s  law,  according  to  which  employers  may  take  no  action 
against  a  “protected  reporter”  without  the  employee’s  consent  as  well  as  permission  from  the  Labour 
Inspectorate. Employers must demonstrate there is no link between the action and the employee having 
reported misconduct. The Inspectorate must decide on cases without “undue delay” or within a maximum 
of 30 days. Employers and employees have the right to appeal. On the other hand, the so-called status of 
“public  interest  witness”  provided  for  under  Greek  law  is  in  fact  merely  a  procedural  defence  for 
whistleblowers  reporting  corruption,  in  cases  of  complaints  lodged  against  them  for  the  offences  of 
perjury,  false  accusation  and  defamation.  The  relevant  provision  of  the  Code  of  Criminal  Procedure 
provides that, if the whistleblower provided information that contributes substantially to the revealing and 
prosecution  of  corruptions,  was  not  personally  involved  in  any  way  in  the  offences  and  did  not  aim  to 
benefit  him/herself  by  reporting  the  wrongdoing,  the  public  prosecutor  can  designate  him  as  “public 

35 

 
                                                            
 
whistleblowers have at their disposal judicial relief and remedies, so as to contest the 
retaliatory actions in court, whereby it falls upon the courts to decide, based on all the 
individual  circumstances  of  the  case,  whether  they  meet  the  conditions  of  the 
applicable rules. 

5.   Ensure the effectiveness of the framework for whistleblowers: 

  Imposition  of  sanctions  against  persons  who  hinder  reporting;  retaliate  against 
reporting  persons;  bring  vexatious  proceedings  against  reporting  persons  or  breach  the 
duty  of  maintaining  the  confidentiality  of  the  identity  of  reporting  persons,  as  well  as 
sanctions  against  reporting  persons  who  make  malicious  or  abusive  reports  including 
measures for compensating persons affected by a malicious or abusive report; 

  obligation of those who receive reports through internal or external channels to follow 
up on the reports within a certain timeframe and give feedback to the whistleblowers: this 
is  necessary  to  reassure  potential  whistleblowers  that  the  system  is  actually  working 
(Principles 19 and 20)153; 

  Obligation of national authorities to publish information on the legislative framework 
in place for the protection of whistleblowers (Principle 27)154;  

  Provision  for  review  by  national  competent  authorities  of  their  procedures  for 
receiving reports and their follow-up regularly and for review by the Commission of the 
implementation of the initiative (Principle 29). 

As all the above are minimum standards,  in all the options, Member States would retain the 
possibility of adopting higher standards of protection for the reporting persons.  

In  addition,  in  all  the  options,  Member  States  would  retain  the  possibility  to  apply  further 
measures  to  facilitate  or  encourage  whistleblowing,  which  go  beyond  the  core  standards 
promoted by the ECtHR/CoE, such as rewards.  

Notably,  in  some  non-EU  jurisdictions  the  reporting  is  encouraged  by  monetary  rewards  to 
persons who report information that leads to successful actions  (one well-known example is 
the US Securities and Exchange Act). However, such systems have not been adopted in the 
majority155 of Member States156, because they are seen as shifting the purpose of the reporting 
away  from  the  public  interest  to  the  personal  gain  of  whistleblowers,  thus  making 
whistleblowing  appear  as  a  commercial  transaction,  which  may  discredit  whistleblowers  in 
general157.  Additionally,  the  introduction  of  such  rewards  might  be  considered  as  running 

153  

interest witness” and abstain from prosecution, if it is deemed that such prosecution would not serve the 
public  interest.  This  protection  is  extremely  limited,  as  it  only  concerns  criminal  prosecution  and  not 
claims for civil damages, for example, for defamation.   
The obligation of authorities to follow-up on reports can be perceived as a form of protection, as it shifts 
the  burden  of  responsibility  to  pursue  the  matter  from  the  reporting  person  to  the  competent  authority. 
Timely and regular feedback is also considered as an important aspect of protection; see UNDOC (2015). 
154   Whilst EU legislative initiative could oblige national authorities to publicize the relevant rules, promoting 
awareness  raising  more  generally  or  training  judges  and  competent  authorities  could  be  the  subject  of 
recommendations and flanking support measures. 
155   One Member State that provides for rewards is Slovakia 
156  

By way of example, the report on the review of the UK law on whistleblower protection explicitly states 
that such a system of rewards "would not change the cultural landscape in a positive way". 
Stakeholders consulted, including whistleblowers themselves, were against introducing such standards at 
EU  level  for  similar  reasons,  taking  into  account  also  the  particularly  negative  perceptions  of 
whistleblowers in some national contexts, which date back to social and political circumstances resulting 

157  

36 

 
                                                                                                                                                                                          
 
counter  to  ECtHR  case  law,  according  to  which  whistleblowing  “motivated  by  a  personal 
grievance  or  a  personal  antagonism  or  the  expectation  of  personal  advantage,  including 
pecuniary gain, would not justify a particularly strong level of protection”158. 

5.2 

Assessed policy options 

As evidenced by the problem definition, beyond the specific scope of protection and measures 
to  combat  retaliation,  the  impact  assessment  needs  to  ascertain  in  which  areas  of  EU  law 
introducing  whistleblower  protection  is  necessary  to  strengthen  enforcement  and  whether 
such objective could be fulfilled through regulatory or non-regulatory actions.  
The following policy options have been assessed159: 

1.  Policy option 1: Baseline scenario - maintaining the status quo; 
2.  Policy  option  2:  a  Commission  Recommendation  providing  guidance  to  Member 
States  on  key  elements  of  whistleblower  protection  complemented  by  flanking 
measures to support national authorities; 

3.  Policy  option  3:  a  Directive  introducing  whistleblower  protection  in  the  area  of  the 
financial  interests  of  the  Union  complemented  by  a  Communication  setting  a  policy 
framework at EU level, including flanking measures to support national authorities ;  
4.  Policy option 4: a Directive introducing whistleblower protection in specific areas of 

EU law; 

a.  Sub option of policy option 4: a Directive under policy option 4 complemented by 
a  Communication  setting  a  policy  framework  at  EU  level,  including  flanking 
measures to support national authorities; 

Discarded options 

Further policy options were discarded following a preliminary assessment:  

- A legislative initiative based on Article 50(2)(g) TFEU aimed at enhancing the integrity of 
the private sector by introducing minimum standards for setting up reporting channels.  

The main reasons for which this option is discarded are its limited scope of application and of 
the  protection  granted.  Setting  up  reporting  channels  based  on  minimum  standards  would 
reassure workers that it is safe and acceptable for them to internally raise concerns and would 
likely increase the ability of those in charge of the organisation to take steps in time to prevent 
damages  to  the  company’s  economic  performance  and  business  reputation.  However,  while 
such  legislative  initiative  would  facilitate  the  early  detection  of  wrongdoing,  and  may  even 
have a dissuasive effect on potential wrongdoers and enhance consumers’ trust and protection, 
only the private sector actors would be covered. In addition, a legislative initiative in this area 
would  only  allow  to  require  setting  up  of  internal  reporting  channels  within  private  law 
entities, while the availability and design of external reporting channels (i.e. to the competent 
authorities) and the availability and forms of protection of whistleblowers against retaliation 
would  be  left  to  the  discretion  of  Member  States  laws.  This  outcome  would  undermine  the 
overall effectiveness and rationale of the measure in light of the shortcomings identified in the 
problem definition. 

in  distrust  towards  ‘informers’.  Business  associations  were  also  against  them  on  the  grounds  that  they 
would encourage abusive reports and create mistrust in the workplace. 
ECtHR, No. 28274/08, Case Heinisch v. Germany, Judgement of 21 July 2011, para. 69. 
The options analysed in this impact assessment differ from the options examined in the ICF study (Annex 
14), to the extent that the latter are formulated without reference to specific Treaty Articles. 

158  
159  

37 

 
                                                                                                                                                                                          
- A legislative initiative under Article 153(1)(a) and (b) TFEU has also been discarded. Such 
initiative  would  regulate  aspects  of  whistleblower  protection  relating,  respectively,  to  the 
improvement  of  the  working  environment  to  protect  workers’  health  and  safety,  and  to 
working conditions and would provide protection to workers reporting on violations of both 
national and EU law.  

The  personal  scope  of  such  an  initiative  would  be  very  limited.  It  would  only  cover 
employees and would leave unprotected other types of potential whistleblowers, such as self-
employed  persons,  contractors  or  suppliers,  who,  according  to  evidence  available160  and 
international standards161 , also need protection against retaliation. It would also not allow for 
protection  of  all  the  different  categories  of  persons  referred  to  in  the  Council  of  Europe 
Recommendation.  The  limited  personal  scope  would  thus  constitute  a  main  gap  in  the 
protection of whistleblowers at EU level. By excluding from protection crucial categories of 
potential whistleblowers, such an initiative would also have limited effectiveness in terms of 
improving the enforcement of EU law.  

The limited personal scope would not be compensated by a more extensive protection. Article 
153  TFEU  would  not  offer  any  additional  protection  in  comparison  to  the  policy  options 
retained in this Impact Assessment and, in particular, an initiative based on this Article would 
not  allow  providing  for any  further  measure  against  retaliation.  On  the contrary, the  overall 
protection  offered  under  Article  153  TFEU  might  be  even  more  limited,  as  rules  for  the 
protection  for  whistleblowers  against  criminal,  civil  and  administrative  proceedings  could 
only  be  granted  if  required  to  protect  the  safety  and  health  of  employees  in  the  working 
environment. Moreover, obligations on Member States to put in place reporting channels or to 
properly investigate the reports would seem to  go beyond the proper  scope of the notion of 
safety and health at work.  

Article 153 TFEU  would also not  be a suitable legal basis  for harmonising Member States’ 
rules defining what constitutes legitimate whistleblowing.  

Finally,  an  initiative  based  on  Article  153  TFEU  could  result  in  imposing  burdens  on 
employers  which  would  not  be  justified  by  the  resulting  ancillary  benefits  in  terms  of 
improving  enforcement  of  EU  law.  The  focus  on  the  protection  of  the  workers'  health  and 
well-being  and  their  working  conditions  could  mislead  employees  and  entail  a  substantial 
increase of the number of reports on work-related individual grievances (and thus higher costs 
for the employer linked to the investigation of such reports), while it would not translate into a 
higher rate of detection of breaches of EU law.  

Overall,  a  legislative  initiative  based  on  Article  153,  extending  protection  also  to  situations 
where  there  is  no  cross-border  dimension  or  other  spill-over  impact,  where  there  is  no 
connection with EU law or with the financial interests of the EU, would be a far-reaching – 
and  consequently  also  quite  costly  –  EU  regulatory  intervention,  which  does  not  appear  to 
meet the requirements of proportionality.  

5.2.1  Policy option 1: Baseline scenario – maintaining the status quo 

Maintaining  the  status  quo  would  entail  no  new  action  taken  at  EU  level.  Member  States' 
legislations  would  be  the  primary  source  of  protection  of  whistleblowers  together  with  the 
existing  sectorial  instruments  of  EU  law.  The  Commission  would  pursue  the  monitoring  of 

160  
161  

See in detail above, sections 1 and 2.2. 
See notably the Recommendation of the Council of Europe, the UN Resource guide on good practices in 
the protection of reporting persons, and position expressed by stakeholders in consultations.  

38 

 
                                                            
the  transposition  and  the  enforcement  of  existing  sectorial  rules;  continue  monitoring  the 
developments  at  national  level  in  the  context  of  the  EU  Semester  and  its  anti-corruption 
policy, and continue supporting research and promoting the exchange of good practices.  

If, on the one hand, some Member States are currently reviewing or adopting new legislation 
on whistleblower protection, on the other hand, the national reforms are not coordinated and a 
number  of  Member  States  still  have  weak  or  no  whistleblower  protection.  The  gaps  in 
protection and the legal uncertainty resulting from fragmentation and divergence in protection 
across  the  EU  would  not  be  addressed  in  a  satisfactory  way  by  the  existing  EU  rules  on 
protection of whistleblowers, which are sectorial and mainly in place to ensure enforcement 
of specific EU instruments whilst providing for varying and rather limited protection. 

Maintaining  the  status  quo  would  therefore  not  address  the  fear  of  retaliation,  the  lack  of 
sufficient protection at national and at EU level and the lack of effective implementation, so 
ultimately  it  would  not  resolve  the  problem  of  underreporting.  A  detailed  explanation  is 
contained in Section 2. 

5.2.2.  Policy option 2: Commission Recommendation providing guidance to Member States 
on key elements of  whistleblower  protection complemented by flanking measures to support 
national authorities 

This  option  would  consist  of  a  Commission  Recommendation  to  Member  States  aimed  at 
setting out key standards (notably drawn from the Council of Europe 2014 Recommendation) 
and promoting best practices identified at national and international level. The main objective 
would seek to overall raise the level of protection of whistleblowers in the Member States and 
promote  greater  convergence  of  national  approaches.  The  Commission  would  monitor  the 
implementation  of  the  Recommendation  and  assess  deficiencies  in  implementing  national 
measures through specific country recommendations under the European Semester. 

In  order  to  bring  added  value  as  compared  to  the  Council  of  Europe  Recommendation,  the 
Commission  would  complement  the  initiative  with  flanking  initiatives  to  support  national 
authorities  in  implementing  its  Recommendation.  These  measures  would,  in  particular, 
address  the  sense  of  futility  that  may  dissuade  individuals  from  reporting,  the  lack  of 
awareness on how and where to report and the legal uncertainty about their rights if they blow 
the whistle, as well as increase trust in the effectiveness of the framework on whistleblower 
protection.  

A further measure targeted to combat the above drivers of under-reporting would be involving 
the European Network of Ombudsmen. In a large number of cases where corruption is carried 
out by public officials, reports by whistleblowers may not trigger a proper investigation due to 
deficiencies  in  the  independent  auditing  system  and  follow-up  of  the  reports.  In  case  of 
inaction  by  national  authorities,  whistleblowers  may  not  be  aware  of  the  further  steps  to 
follow and may need independent advice and guidance. 

As part of its strategy for an effective enforcement of EU rules, set out in its Communication 
"EU Law: Better Results through Better Application", the Commission will support effective 
national remedies to EU citizens and strengthen its cooperation with the European Network of 
Ombudsmen.  The  members  of  this  Network  could  handle,  according  to  their  competence, 
complaints in cases of maladministration for failure to act upon whistleblower reports, namely 
in cases where reports by whistleblowers did not trigger a proper investigation and follow-up 
at  national  level.  The  European  Ombudsman  could  draw  a  report  on  the  information  that 
Network's  members  may  provide  to  it  regarding  activities  and  inquiries  on  whistleblower 
protection and forward that report to the Commission and the European. 

39 

 
5.2.3  Policy  Option  3:  Directive  introducing  whistleblower  protection  in  the  area  of  the 
financial  interests  of  the  Union,  complemented  by  a  Communication  setting  a  policy 
framework at EU level, including flanking measures to support national authorities  

Policy  option  3  would  consist  of  a  Directive  based  on  Article  325  TFEU  aimed  at 
strengthening  the  protection  of  the  financial  interests  of  the  Union  and  would  set  out 
minimum  standards  of  harmonisation  on  reporting  channels  and  protection  to  individuals 
reporting  fraud,  corruption  and  other  illegal  activities  affecting  the  financial  interests  of  the 
Union.  The  rationale  of  this  policy  option  is  to  enhance  enforcement  in  a  core  competence 
area of the EU: introducing whistleblower protection would enhance upstream the reporting 
of illegal activities and facilitate their detection by national and EU enforcement mechanisms. 
It would also complete the system of protection of the financial interests of the Union, built on 
the EPPO's criminal investigations and prosecutions and OLAF administrative investigations.  

While  the  Directive  would  include  all  the  measures  of  protection  listed  in  Section  5.1,  the 
protected  disclosures,  i.e.  the  cases  in  which  whistleblowers  would  be  granted  protection, 
would be limited to fraud, corruption and other violations of the EU budget.  

Moreover,  the  Commission  would  accompany  the  Directive  with  a  Communication  setting 
out  flanking  measures  to  support  effective  whistleblower  protection  and  promoting  best 
practices identified at national and international level (similarly as under option 2).   

5.2.4  Policy option 4: Directive introducing whistleblower protection in certain areas of EU 
law 

Policy option 4 would consist of one single Directive based on Articles 114 and Article 325 
TFEU162  setting  out  minimum  standards  of  harmonisation  of  whistleblower  protection  and 
affording  protection  not  only  to  individuals  reporting  fraud,  corruption  and  other  illegal 
activities affecting the financial interests of the Union (Option 3) but also to those reporting 
about violations of EU law related to the proper functioning of the internal market as well as 
in other areas such as in the field of environmental protection, food safety, animal health and 
welfare,  product  and  transport  safety,  consumer  protection,  public  health  and  protection  of 
privacy and personal data.  

Option 4 would thus be targeted at those violations of EU law which could result in serious 
harm  to  the  public interest  in  the  form  of  detriment  to  the  financial interests  of  the  EU  and 
more  generally  the  finances  of  the  Member  States  (EU  budget,  EU  funds,  tax  evasion  and 
avoidance, public procurement, competition, financial services) or to the welfare of the public 
at  large  (environmental  protection,  nuclear  safety,  food  safety,  animal  health  and  welfare, 
product  and  transport  safety,  consumer  protection,  public  health,  protection  of  privacy  and 
personal data and security of network and information systems).  

Option 4 has thus the broadest scope of all options assessed: it covers all the areas in which 
whistleblower  protection  has  been  identified  as  necessary  to  reinforce  the  detection, 
investigation  and  prosecution  of  violations  of  EU  law  that  can  lead  to  serious  harm  to  the 
public interest. It would also fill the gaps and bring consistency to the existing EU legislation 
providing  whistleblower  protection  in  the  financial  services  sector.  It  would  also  strengthen 
the  enforcement  of  EU  law  in  the  field  of  privacy  and  data  protection,  environmental 
protection,  nuclear  safety  and  transport  safety,  where  few  instruments  contain  rules  on 

162  

Combined with Treaty articles related to the relevant specific areas, i.e. Articles 16, 33, 43, 50, 53(1), 62, 
91,  100,  103,  109,  168,  169,  192  and  207  TFEU  and  the  provisions  of  the  Treaty  establishing  the 
European Atomic Energy 

40 

 
                                                            
whistleblower  protection,  as  well  as  in  the  areas  of  public  procurement,  tax  evasion  and 
avoidance,  food  and  product  safety,  public  health  and  consumer  protection,  protection  of 
privacy and personal data and security of network and information systems, where currently 
there are no such rules but where whistleblower protection is proven to be necessary.  

5.2.5  Policy  Option  4  Sub  option  1:  Directive  under  policy  option  4  complemented  by  a 
Communication  setting  a  policy  framework  at  EU  level,  including  flanking  measures  to 
support national authorities 

Under  this  sub-option,  the  Commission  would  accompany  the  legislative  instrument  under 
option 4 with a Communication and flanking non-regulatory measures as under option 3. The  
Communication  will  promote  an  effective,  comprehensive  approach  to  whistleblower 
protection and thus encourage Member States to ensure coherence and legal certainty within 
the national legal frameworks, based on the principles developed by the Council of Europe in 
its 2014 Recommendation on Protection of Whistleblowers, and the case law of the European 
Court of Human Rights on the right to freedom of expression. 

41 

 
5.3 Summary of the policy options 

protection provided  

‘++’ significant comprehensive protection  

‘0’   no significant protection 
‘+’   moderate protection only in certain areas 
‘(..)’ uncertain effect in the level of  

Protected 
disclosures 

Sector of 
application 

Personal scope 

Reporting 
channels 

Safeguards for 
the reporting and 
the concerned 
persons 

Protection of 
reporting persons 
against retaliation 

Ensuring 
effectiveness of 
the framework 

Illegal activity affecting the financial interests of the Union 
Violations of EU rules which can cause harm to the public interest, in the area of the financial 
interests of the Union, in areas related to the proper functioning of the internal market, and in the 
areas of environmental protection, food, product and transport safety, consumer protection and 
public health  
Private sector  
Public sector 
Employees   
Contractors, suppliers or other self-employed persons providing services  
Dedicated channels for the employees to report within their organisation 
Channels for external reporting to competent authorities  
Confidentiality of the data of the reporting person 
Protection of the personal data of the reporting and the concerned person 
Respect of the rights of defence of the concerned person 
Protection only to persons who reasonably believe the information to be true 
Sanctions against persons who deliberately report information they know to be untrue  
Tiered  use of reporting channels 
Remedial measures against work-related retaliation  
Access to information and independent advice on remedies and procedures available  
Reversal of burden of proof 
Prohibition of “gagging clauses” 
Sanctions against persons who hinder reporting, who take retaliatory measures or bring vexations 
proceedings against a whistleblower and those who breach the duty of confidentiality vis-à-vis a 
whistleblower 
Right of the reporting persons to rely on having made a report in accordance with the applicable 
rules on whistleblowing as a defence in judicial proceedings  
To follow up on the reports within a certain timeframe and give feedback to the whistleblowers 
To regularly publish data on whistleblower reports 
To publicise information on available channels and protection 
To train public servants, legal practitioners and law enforcement 
To raise awareness about the legislative framework in place for the protection of whistleblowers 

Status 
quo 
0 
0 

Option 
2 
(+) 
(+) 

0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 

0 

0 
0 
0 
0 
0 

++ 
++ 
++ 
++ 
(+) 
(+) 
(+) 
(+) 
(+) 
(+) 
(+) 
(+) 
(+) 
(+) 
(+) 
(+) 
(+) 

(+) 

(+) 
(+) 
(+) 
(+) 
(+) 

Option 3  Option 4 

++ 
+ 

++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 

++ 

++ 
++ 
++ 
(+) 
(+) 

++ 
++ 

++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 

++ 

++ 
++ 
++ 
0 
0 

Option 4 
sub option 1 
++ 
++ 

++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 
++ 

++ 

++ 
++ 
++ 
(++) 
(++) 

42 

 
 
 
6.  IMPACT OF THE POLICY OPTIONS: ASSESSMENT   

6.1   Methodology and baseline 

The following criteria have been used in order to determine the impacts of each policy option: 

  Effectiveness in meeting the policy objectives: to which extent the policy options address 

the general and specific objectives established in Section 4.  

  Economic  costs:  (i)  impact  on  the  legal  system  of  Member  States  and  (ii)  economic 
burdens  for  public  and  private  employers  as  well  as  for  Member  States  in  terms  of 
adapting to the new legislation.  

  Feasibility: legal and non-legal constraints to implement effectively the policy option.  

The  effectiveness  of  each  of  the  options  is  measured  towards  the  fulfilment  of  the  general 
objective  as  established  in  the  problem  definition,  i.e.  to  address  under-reporting  so  as  to 
improve  the  enforcement  of  EU  law.  This  parameter  is  in  turn  measured  as  regards  the 
achievement  of  the  specific  objectives:  (i)  increase  the  protection  of  whistleblowers,  (ii) 
enhance legal certainty and clarity and (iii) reinforce awareness. The fulfilment of the specific 
objectives would lead to, in the medium to long term, to an increase of the reporting rate and 
unmasking of wrongdoings by ensuring effective whistleblower protection.  

The quantification of the impacts (i.e. economic costs and benefits) of each policy option is 
limited,  due  to  lack  of  information.  A  specific  external  study163  has  been  commissioned  to 
assess  the  impacts  of  the  implementation  of  each  of  the  policy  options  both  in  terms  of 
qualitative  quantitative  impacts.  Moreover,  information  on  overall  impacts  of  the  policy 
options,  particularly  in  certain  aspects  of  the  internal  market,  is  complemented  by  other 
information sources164. 

While all employees and other types of categories of individuals on a work-based context can 
be  offered  protection  provided  report  a  protected  disclosure,  not  all  the  private  entities  will 
have  the  obligation  to  establish  internal  reporting  channels.  Accordingly,  the  reference  to 
“employer”  in  this  section  refers  to  public  authorities  as  well  as  large  and  medium-sized 
companies and costs have been calculated only taking into account the impacts on this type of 
companies. Generally, the proposed measures are not expected to have an impact on medium-
sized  enterprises  (see  detailed  analysis  on  the  SME  test  in  Section  7  and  Annex  11). 
Businesses in the private sector with less than 50 employees are excluded  a priori from the 
obligations  to  establish  internal  reporting  channels  in  accordance  with  the  Commission’s 
better regulation principles165, with the exception of small and micro companies operating in 
the area of financial services or those vulnerable to money laundering and terrorist financing. 

This  section  defines  costs  in  two  areas:  (a)  estimating:  the  main  administrative  costs  for 
Member  States  (i.e.  cost  for  transposition  and  enforcement  of  the  legislation)  and  (b) 
implementation  costs  (compliance with  the  requirements  provided  by  the  new  legislation  as 
employers in the public and private sector).  

The quantification of the administrative costs for Member States is calibrated to the current 
legal  situation  (i.e.  baseline  scenario)  in  each  Member  State.  Therefore,  the  new  legal 
requirements  under  the  policy  options  would  not  impose  additional  costs  to  those  Member 

163  
164  

165  

See Annexes 13 – 14, for the overall results of the study, including Section on costs and benefits.  
See, for example, the report of Milieu on a detailed analysis of the benefits of whistleblowing in the area 
of public procurement,  https://publications.europa.eu/en/publication-detail/-/publication/8d5955bd-9378-
11e7-b92d-01aa75ed71a1/language-en, as well as specific information relating to national data provided 
in the preparatory impact assessments of national legislation on whistle protection in Ireland and Sweden  
See in Section 7.7 a further explanation on the exemption of obligations to small companies.  

43 

 
                                                            
States whose national law already mirrors the specific requirements of the policy option. For 
those Member States are currently preparing new legislation on whistleblower protection, the 
quantification  has  been  made  as  regards  the  status  quo,  without  taking  into  account  future 
developments,  since  the  outcome  of  the  legislative  procedures  is  uncertain  and  could  be 
minimal.  

The implementation (i.e. compliance) costs relate to the obligation of employers in the private 
and public sector to establish effective reporting channels as well as to follow-up on reports 
received.  These  costs  are  divided  into  one-off  implementation  costs  and  recurrent 
implementation costs based on estimates of the duration of time that employers will spend on 
tasks  related  to  the  changes  in  the  legislation  and  following-up  on  reports.  The  costs  have 
been estimated for private employers and public sector employers by multiplying the number 
of employers affected by the legislation by the cost factors described above (time is costed at 
the labour cost of the amount of time taken for each activity).  

The one-off costs related to implementation of new legislation are divided as follows:  

  The cost to employers to interpret the new legislation and develop workplace policies 

which align with the legislation; 

  The cost to employers to set-up internal reporting channels to comply with the new or 

amended legislation; and 

  The cost to develop or amend training materials to ensure staff is aware of reporting 

channels and what constitutes a protected disclosure. 

The annual operational costs are determined according the following parameters:  

  Providing  internal  reporting  channels  (estimated  to  cost  one  hour  of  staff  time  per 
report;  the  number  of  reports  per  person  is  assumed  to  increase  as  the  strength  of 
protection increases); 

  Providing  outsourced  internal  reporting  channels  (estimated  to  cost  €1.5  per  person 

 

per year, based on consultations with hotline providers and other experts); 
Investigating  and  managing  cases  (estimated  to  take  an  average  of  two  days  of  staff 
time per report for both internal and outsourced internal reporting channels); and 
  Providing annual training that ensures that potential whistleblowers are aware of how 
to  report  and  are  confident  that  they  will  not  be  retaliated  against  for  reporting 
(estimated at half an hour of training per worker per year). The proportion of workers 
who  receive  training  to  ensure  they  are  aware  of  the  violations  of  law  and  reporting 
channels is assumed to vary by the strength of protection available in a Member State. 

As regards the benefits, there is no data available in the EU quantifying the specific benefits 
due to a causality link between whistleblower protection and better enforcement of law. The 
data presented is,  thus, based on modelling with a series of presumptions assuming that  the 
positive  impact  of  increasing  whistleblower  protection  will  in  turn  increase  the  number  of 
reports  and  will  improve  enforcement  of  EU  law,  with  a  certain  degree  (i.e.  percentage)  of 
recovery of misused revenues of the EU budget. In terms of benefits, data modelling focused 
on those areas where violations of EU law lead to economic loss for public finances. In the 
area  of  public  procurement,  for  example,  data  modelling  is  based  on  a  combination  of 
different  parameters,  including  the  index  of  level  of  fraud  in  a  Member  State,  the  average 
level  of  public  funds  spent  and  most  accepted  presumption  of  international  research  studies 
(i.e. Global Fraud Report) which advocate that whistleblower protection can uncover 40% of 
corruption or fraud.  

44 

 
The increase of the number of reports is based on data provided by research166 and estimated 
as  regards  2022  to  allow  for  (a)  time  for  legislation  to  be  adopted  and  then  transposed  into 
national laws and (b) time for reporting channels to be set up and  publicised. However, it is 
assumed that not all the reports will lead to cases relating to effective violations. 

6.2   Assessment of the Impacts 

While the degree of their social and economic impacts may vary from one option to the other, 
all options have positive impacts in the following dimensions: 

Social impact 

The major social impact of reinforcing a system of protection of whistleblowers at EU level is 
better enforcement of EU law and deterrence of illegal or abusive activities167 by increasing 
the  reporting168.  Besides  preventing  and  addressing  ensuing  risks,  reinforcing  protection  of 
whistleblowers  will  contribute  to  better  working  conditions  and  well-being  of  workers.  The 
positive  outcome  is  reinforced  if  effective  accompanying  measures  –  awareness-raising, 
promotion and training – are deployed. 

  Impact on citizens 

Based  on  the  Global  Business  Ethics  Survey,  it  has  been  estimated  that  improving 
whistleblower  protection  would  entail  a  direct  prevention  of  retaliation  of  7%  of  the 
workforce  employed  in  the  sectors  covered  by  the  survey169.  If  it  is  assumed  that  this 
percentage  remains  the  same  for  the  workforce  in  the  areas  covered  by  the  policy  options 
under  this  impact  assessment,  especially  options  3  and  4,  moving  to  a  stronger  or  more 
extensive  obligation  would  enhance  the  level  of  protection.  The  introduction  of  strong 
protection  will  concern,  on  average,  40%  of  the  total  workforce  who  were  previously 
unprotected (around 60 million workers) and improves the level of protection for nearly 20% 
of the workforce (around 26 million workers). Overall, the largest increase in the number of 
employers providing protection is in Germany, Poland and Spain170. This is due to the large 
number of employers in these countries and the lack of coverage of the national legislation in 
the baseline scenario171.  

  Impact on businesses 

Although  the  set  of  measures  linked  to  the  creation  of  an  EU  system  of  protection  for 
whistleblowers would involve specific costs to public and private employers, the large scale 

166   According  to  the  information  provided  by  Transparency  international  to  the  European  Commission, 
following the adoption of legislation in IE, there was an increase of 240% of the number of individuals 
requesting for advice. 

167    The  study  “Whistleblower  laws  and  corporate  fraud:  Evidence  from  the  US”  (Adriana,  S.,  Cordis, 
Elizabeth  M.  Lambert,  Department  of  Accounting,  Finance  and  Economics,  Winthrop  University,  US, 
2017)  analysed  whether  whistleblower  laws  which  protect  private  employees  from  retaliation  are 
effective for deterring corporate fraud. The comparison was made between US States with different levels 
of protection and indicated that whistleblower laws that protect private employees reduce the prevalence 
of corporate fraud by increasing the probability that corporate malfeasance is detected and punished. The 
deterrent effect of whistleblower laws is broadly consistent with standard arguments from the economic 
theory of crime. 
See data under Section 2, on national experiences after introducing a comprehensive system of protection.  
http://www.world-psi.org/sites/default/files/documents/research/en_whistleblower_protection.pdf 
Italy was initially included in the gathered by ICF. However, policy options will no longer have a large 
impact in Italy due to the recent adoption of legislation on 15 November 2017. 
See Annex 14, on the ICF study, Section 6.5.2. 

168  
169  
170   

171  

45 

 
                                                            
of  the  benefits  outweigh  the  costs.  Among  other  factors,  it  would  contribute  to  a  healthy 
competitive business environment at EU level, by making it harder for companies to acquire 
competitive  advantages  through  inappropriate  methods.  Law-abiding  companies  will, 
therefore, find it easier to compete and their attractiveness for investors would increase.  

Positive  impacts  on  good  governance  and  long-term  organisation  performance  are  also 
expected to materialise. The legislative options ought to have a positive impact in the long run 
on organisational performance in those Member States where they raise the level of protection 
provided to whistleblowers in law. Moreover, they would reinforce the ability of companies to 
prevent as well as repair damage to their reputation to a significant extent by publicly clearing 
up any misunderstandings about what might have happened, or by describing steps taken as 
follow up to the whistleblowing. One fifth (20%) of business organisations responding to the 
open  public  consultation  cited  improvements  to  companies’  economic  performance  as  a 
benefit of rules obliging public and private organisations to protect whistleblowers. 

The  costs  linked  to  a  disproportionate  increase  of  the  number  of  reports  to  be  assessed  are 
mitigated by the fact that whistleblower protection remains linked to the public interest. The 
reference to serious harm to the public interest makes clear that reports related to individuals' 
personal  grievances  or  working  conditions,  where  there  is  no  wider  public  interest,  do  not 
qualify for protection.  

Economic impact 

A comprehensive system of whistleblower protection will have a positive impact in terms of 
recovery  of  illicit  activities  against  the  EU  budget.  While  it  is  not  possible  to  ascertain  the 
exact benefit of whistleblower protection in terms of recovery of revenues, an estimation of 
the  potential  benefits  putting  in  place  a  robust  whistleblower  regime  could  amount  to 
EUR1.75 billion over 10 years172. 

For  example,  a  reinforced  system  of  protection  of  whistleblowers  would  contribute  to 
diminishing  the  “VAT  gap”  in  the  Member  State,  which,  as  explained  in  Section  2,  is 
estimated to amount to EUR 175 billion in 2017 and to rise to EUR 217 billion by 2027 in the 
absence of policies addressing this issue. In terms of customs duties, limited data is available.  

In addition to the benefits relating to the fraud against EU revenues, in terms of fighting 
corruption, the potential gains are also substantial. In 2014, the European Commission 
estimated that the total cost of corruption in the EU is of EUR 120 billion per year. More 
recent estimates, based on a different methodology, raise this figure to EUR 817 billion – 
EUR 990 billion, which is 4.9% – 6.3% of GDP173. Whistleblower protection is a key element 
of a successful anti-corruption framework, as it can help overcome problems related to 
detection and act as a deterrent. In a scenario where EU legislation on whistleblowing is 
effectively implemented, the level of corruption across the EU will reduce the current risk 
estimated at EUR 179 billion – EUR 256 billion.  

172  

173  

ICF  data  on  the  external  study  indicates  that  recovery  of  revenues  through  an  effective  system  of 
protection of whistleblowers could help recovering an amount up to 40% of the total loss.  
European Commission (2014). EU Anti-Corruption Report; RAND (2016), The Cost of Non-Europe in 
the  area of Organised  Crime  and  Corruption, Annex  II  – Corruption.  RAND developed  an  approach to 
modelling costs of corruption in terms of lost economic output. 

46 

 
                                                            
Impact on fundamental rights174 

With the exception of the baseline scenario, all policy options aimed at increasing the current 
level  of  protection  for  whistleblowers  will  have  a  positive  impact  on  fundamental  rights  as 
provided by the Charter, especially with regard to:  

  Freedom  of  expression  and  right  to  information  (Article  11  of  the  Charter): 
Insufficient protection of whistleblowers against retaliation discourages citizens from 
reporting. In consequence the public’s right to access information is affected. Media, 
and especially investigative journalism, depend on others to provide the information 
they  later  convey  to  the  public.  Those  sources  who,  due  to  their  position  inside 
companies  and  public  bodies,  have  first-hand  knowledge  about  the  threats  to  the 
public  interest  risk  retaliation  if  exposed.  Therefore  a  stronger  protection  of 
whistleblowers should increase the legal certainty and encourage whistleblowing also 
to the media. Even if direct public disclosures (including whistleblower reports to the 
media)  are  to  be  limited  only  to  certain  specific  scenarios  (i.e.  only  the  situations 
when use  of  usual reporting channels internally and/or  externally  is not possible or 
would  not  achieve  a  desired  goal),  strengthening  the  protection  of  whistleblowers 
from  retaliation  and  clarifying  the  conditions  of  protection  should  overall  support 
freedom of expression. 

  Any of the policy options will also have a positive impact on the right to fair and just 
working  conditions  (Articles  30  and  31  of  the  Charter)  because  a  higher  level  of 
protection  for  whistleblowers  would  be  secured  through  establishing  of  reporting 
channels  and  improving  protection  against  retaliation  in  the  work-based  context. 
Depending  on  the  scope  of  the  measures  and  as  far  as  they  increase  reporting  and 
preventing  illegal  activities  there  may  be  impacts  on  health  care  (Article  35  of  the 
Charter), environmental protection (Article 37 of the Charter), consumer protection 
(Article 38 of the Charter) and the general principle of good administration.  

The  higher  level  of  protection  of  fundamental  rights  as  described  may  interfere  with  the 
protection  of  other  fundamental  rights.  In  this  regard  a  balanced  approach  is  necessary  to 
maintain the right to private life and to the protection of personal data (Articles 7 and 8 of the 
Charter) of whistleblowers but also of the reported persons, the presumption of innocence and 
the rights of defence of the latter (Articles 47 and 48 of the Charter). The freedom to conduct 
a business (Article 16 of the Charter) might also be affected by any of the initiatives imposing 
obligations that come with implementation costs to employers. However, any of the potential 
limitations those fundamental rights resulting from the policy options would comply with the 
conditions provided for in Article 52(1) of the Charter175. 

Finally,  through  the  implementation  of  policy  options  3  and  4,  the  EU  will  establish  the 
necessary  link  through  secondary  EU  legislation  to  monitor  compliance  of  the  Charter 
(Article 51(1) of the Charter). These options are thus bound to have positive effects also on 
the respect of all fundamental rights, in the context of implementation of EU law. 

174  

The impacts on fundamental rights are examined in particular in light of the Fundamental Rights "Check 
List" in the Communication from the Commission on the Strategy for the effective implementation of the 
Charter by the European Union (COM (2010)573 of 19 October 2010). 

175   Any limitations of fundamental rights must be provided for by law, respect the essence of those rights and 
freedoms, meet objectives of general interest recognised by the Union or the need to protect the rights and 
freedoms  of  others  and  comply  with  the  principle  of  proportionality,  i.e.  they  must  be  appropriate  and 
necessary to meet the objective. 

47 

 
                                                            
6.3   Analysis of the policy options 

6.3.1.   Policy Option 2: Commission Recommendation providing guidance to Member States 
on key elements of  whistleblower  protection complemented by flanking measures to support 
national authorities 

A. Views of stakeholders 

Few of the stakeholders consulted consider this option to address fully the problem definition 
and its drivers. Existing non-regulatory measures set by international organisations such as the 
Council  of  Europe  have  not  triggered  a  high  overall  increase  of  national  legislation  in  EU 
Member  States.  While  prompting  some  changes  in  certain  Member  States,  the  Council  of 
Europe Recommendations have not triggered policy responses in others.  

While some stakeholders have noted that non-regulatory measures may contribute to improve 
the  implementation  of  existing  national  legislation  by  bringing  clarity  and  awareness-
raising176  and  could  potentially  also  guide177  those  Member  States  currently  envisaging 
national legislation on whistleblower protection, the  majority of stakeholders  underlined the 
lack of enforceability as the main factor reducing the effectiveness of this policy initiative178. 
In the workshops organised by the Commission with Member States' experts and in response 
to the OPC, a few Member States expressing a clear preference for EU soft-law measures and 
promotion of good practices. 

B. Effectiveness in meeting the policy objectives 

Policy  option  2  could  improve  the  status  quo,  since  it  would  draw  upon  and  promote  key 
principles already established in international instruments while at the same time proposing a 
broader range of standards and further guidance. It would moreover aim at influencing new 
legislation  in  Member  States  and  encouraging  uptake  of  good  practices,  especially  in  those 
countries that are actively seeking to extend and improve their legislation in this area. It could 
encourage  more  consistent  systems  of  protection  and  reduce  the  uneven  protection  among 
Member States.  

The  Recommendation  would  also  raise  awareness  about  the  added  value  of  whistleblowing 
and support showcasing the contribution of whistleblowers to exposing threats or harm to the 
public  interest,  thus  helping  to  fight  negative  social  perceptions.  It  would  thus  contribute to 
tackling the socio-cultural factors contributing to underreporting by whistleblowers.  

Nonetheless,  a  Recommendation,  even  if  supplemented  by  flanking  measures,  comes 
inevitably with the risk of low up-take by the Member States and only limited improvement in 
deterrence for illegal activities related to the internal market of the EU would be expected179. 

176 

177 

178 

179 

For example, amongst business associations responding to the Commission’s OPC, support for EU legally 
binding minimum standards was not as high as amongst other stakeholders’ groups. Out of a total of 40 
responses, 20 selected EU legislation as preferred option, 14 solely national law and 5 considered that no 
legislation is needed. Some business organisations put forward that legislation at EU level would bring an 
added  value  to  existing  national  legislation  and  voluntary  company-level  compliance  measures  which 
already provide sufficient and carefully balanced protection. 
National experts from a large number of Member States which are currently in the process of considering 
or drafting legislation on whistleblower protection were keen to have the European perspective. 
Participants at the experts’ workshop of 7 June noted, for instance, that non-regulatory measures such as a 
Commission recommendation would not be suitable or sufficient to address the problems resulting from 
lack of adequate whistleblower protection. 
The  conclusion  is  drawn  from  the  evolution  of  the  implementation  of  other  non-binding  pieces  of 
legislation under international law, such as the 2014 Council of Europe Recommendation.  

48 

 
                                                            
A non-regulatory approach alone is not expected to significantly add value because there are 
other similar soft law international instruments by international organisations (e.g. Council of 
Europe) and these have not triggered harmonisation across the EU.     

A  non-regulatory  action  is  only  expected  to  increase  by  8%  the  number  of  reports  of 
wrongdoings  across  the  EU  in  the  next  5  years  (until  2022)180.  The  protection  of 
whistleblowers  would  remain  largely  different  depending  on  the  sector,  the  type  of 
wrongdoing and depending on the country where the disclosure is made.  

C. Economic impacts 

(i) 

Impact on the legal system of Member States.  

Assuming that the Recommendation is taken up only by those Member States already having 
a  broad  system  of  protection  or  those  Member  States  who  are  currently  in  the  process  of 
drafting legislation, the cost to public authorities to provide regulatory and advisory functions 
is assumed to remain the same as in the current baseline scenario i.e. EUR 15 million. 

(ii) 

Costs: economic burdens for public and private employers as well as for Member 
States in terms of adapting to the new legislation.  

The costs are summarised as follows: 

Type of Cost  

One-off implementation costs  

Annual operational costs 

Public sector 

Private sector 

TOTAL 

EUR 2.6 million 

EUR 50.8 million 

EUR 53.4 million 

EUR 9.6 million 

EUR 89.2 million 

EUR 98.8 million 

The highest cost is related to training, which amounts to a total of EUR 88 million181 for both 
the public and the private sector, including annual training. However, it is not certain that all 
employees under this policy option, and particularly those working in the public sector, would 
need  a  new  training  each  year,  which  would  accordingly  decrease  substantially  the  total 
amount of costs.  

Additional costs under this policy option are also expected to arise linked to the divergences 
in national legislation on whistleblower protection across the EU. Due to the maintenance of 
the level of legal fragmentation across the EU, the compliance costs of companies operating 
in multiple Member States (facing additional legal complexity and need to adjust their internal 
policy and training) would increase. Moreover, as evidenced in Section 2, there would be no 
improvement towards a healthy competition in the internal market, so that related costs due to 
corruption and bribery, albeit difficult to quantify, would persist.   

D. Feasibility  

The legal constraints of this policy option are marginal, since non-regulatory tools do not need 
the  agreement  of  EU  institutions  (i.e.  Council  of  the  EU  or  the  European  Parliament). 
However, due to its non-binding nature, its overall impact will be limited.  

180 
181 

See Annex 4 on analytical methods on how this % was calculated. 
The amount is composed by EUR 23 million for development of training materials (internal time costs) 
and EUR 65 million for delivery of annual training (cost of employee time). 

49 

 
 
                                                            
6.3.2.   Policy  Option  3:  Directive  introducing  whistleblower  protection  in  the  field  of  the 
financial  interests  of  the  Union  complemented  by  a  Communication  providing  guidance  to 
Member States on key elements of whistleblower protection as well as flanking measures to 
support national authorities 

A. Views of stakeholders 

In the Commission OPC, when asked about negative impacts for other EU countries and the 
EU  as  a  whole  resulting  from  uneven  whistleblower  protection,  respondents  identified  the 
protection of financial interests  of the EU as one of the two top areas (60% of respondents) 
where such impacts materialise. In response to the general question about areas in which rules 
on  whistleblower  protection  are  beneficial,  whistleblower  protection  was  cited  by  82%  of 
respondents  as  contributing  to  the  proper  management  of  public  (national  and  EU)  funds. 
Similarly, on the specific question about the areas in which the EU should offer more support 
to  Member  States  for  the  protection  of  whistleblowers,  84%  of  respondents  cited  the  good 
management of (national and EU) funds. 

Participants at the Member  States' expert workshops of June and November 2017  could see 
the added value of enlarging whistleblower protection to report on wrongdoings related to the 
financial interests of the EU but  considered that this option could lead to different rules  for 
national  and  EU  funds,  which  might  create  legal  complexity  and  uncertainty  for 
whistleblowers.  More  generally,  pursuing  such  a  sectorial  approach  would  not  address 
fragmentation. 

B. Effectiveness in meeting the policy objectives  

By enhancing the fight against fraud and illegal activities affecting the financial interests of 
the Union, policy option 3 addresses the shortcomings identified in Section 2 with respect to 
the lack of investigation and prosecution of core offences against the EU budget. This policy 
option  would  be  consistent  with  the  general  objective  of  improving  the  enforcement  of  EU 
legislation with a particular focus on fighting corruption and fraud. At the same time, option 3 
would  cover  an  area  where,  as  indicated  in  Table  3.1.,  spill-over  impacts  of  insufficient 
enforcement are very strong. 

According to the data of the external study, under this policy option, the Directive envisaged 
would  have  as  a  consequence  that  over  250,000  employers  would  move  from  having  no 
protection  measures  in  place  to  providing  a  strong  protection  for  whistleblowers  and  would 
cause  an  additional  150,000  employers  that  already  provide  some  protection  to  enhance  it 
further.  By  facilitating  and  encouraging  reporting,  the  Directive  under  option  3  would 
enhance upstream the reporting of suspected fraud cases and other unlawful acts affecting the 
Union's  financial  interests  and  facilitate  their  detection  by  national  and  EU  enforcement 
mechanisms, 
investigations  and  prosecutions  and  OLAF 
administrative investigations. Such an instrument would substantially increase the number of 
reports  related  to  the  fight  against  fraud  and  corruption  against  all  EU  revenues  and 
expenditures covered by or due to the EU budget.  

including  EPPO  criminal 

Data from the external study established that under this policy option, the annual number of 
reports  of  wrongdoing  (in  the  area  of  the  protection  of  the  financial  interests  of  the  Union) 
would multiply by 185% in 5 years (2022), from EUR 1.3 million to EUR 2.4 million.  

However,  the  Directive  under  this  option  would  be  yet  another  sectorial  EU  legislation  and 
would not meet the specific objective of addressing the current legal fragmentation and legal 
uncertainty  for  whistleblowers.  This  uncertainty  and  the  fear  of  retaliation  in  case  the 
information  reported  would  not  qualify  for  protection  are  likely  to  decrease  the  overall 

50 

 
effectiveness  of  the  measure,  limiting  the  potential  benefit  in  terms  of  increasing  reporting 
rates. 

This  Directive  could  give  rise  to  a  dual  level  of  protection  (EU  versus  national  budget),  if 
Member  States  would  not  align  national  provisions  on  the  reporting  of  illegal  activities 
affecting  their  national  budget  as  well.  This  factor  could  be  mitigated  by  the  guidance  that 
could  complement  the  legislative  instrument,  in  the  sense  that  national  authorities  could, 
based  on  this  guidance,  extend  protection  to  other  areas  of  EU  law  but  also  to  fraud  and 
corruption linked to the national budget. The effectiveness in other areas outside the financial 
interests  of  the  Union,  in  the  same  terms  as  under  policy  option  2,  remains  uncertain.  The 
non-regulatory measures would have the same impacts on socio-cultural factors contributing 
to underreporting as under option 2.  

C. Economic impacts 

(i) 

Impact on the legal system of Member States.  

As described above, a number of Member States already provide for some form of protection 
in the area of fraud and/or corruption, and national anti-corruption authorities already function 
as an external channel for reporting wrongdoing related to fraud to EU and national budget. 
Nonetheless  Member  States  would  need  to  implement  further  reporting  channels  for  tax 
avoidance and provide for protection when the wrongdoing relates to this issue. However, the 
increase of costs as regards the expenditure on the overall justice system is not expected to be 
high;  it  is  estimated  at EUR  34  million,  which is  nearly  EUR  19  million  higher  than  in  the 
baseline scenario. The largest costs are estimated to be in Spain182, Latvia and Cyprus, since 
these  are  the  Member  States  which  currently  do  not  have  in  place  any  legal  framework  for 
whistleblowing and will need to introduce a large number of legislative changes. The UK and 
France, given the strength of their legislation, will be the countries with less associated costs. 

(ii) 

Costs: economic burdens for public and private employers as well as for Member 
States in terms of adapting to the new legislation.  

In terms of one-off implementation costs for employers in the public and the private sector 183 
the costs for the public sector would amount to EUR 204.7 million while for the private sector 
(large and medium-sized companies) they would amount to a total of EUR 542 million184.  

The annual operational costs to introduce internal reporting channels for the public sector and 
the private sector would amount to EUR 284.4 million and EUR 916 million respectively. The 
costs are summarised as follows: 

Type of Cost 

One-off implementation costs  

Annual operational costs 

Public sector 

Private sector 

EUR 204.7 million 

EUR 284.4 million 

EUR 542 million 

EUR 916.5 million 

TOTAL 

EUR 746.7 million 

EUR 1,200.9 million 

182 

183 
184 

The costs to employers in Spain are based taking into account national legislation, and do not include an 
assessment of any regional law on whistleblower protection. Therefore the number of employers affected 
in Spain may be an over-estimate of the true number. 
For a detailed explanation of the numbers, see Section 6.4 of the ICF report Annex 14.  
These  costs  would  not  however  affect  public  bodies  and  private  companies  in  the  same  manner  in  all 
Member States. For example, the fact that a Member State such as France is closely aligned would not 
entail costs for the employers located in that Member State. 

51 

 
                                                            
The total amount of one-off costs for both the public and private sector is EUR 764.7 million 
while the annual implementing costs amount to EUR 1.2 billion. This amount includes a cost 
of providing training of EUR 722 million, which is based in asking each employee to spend 
30 minutes per year on training about what to do when wrongdoing is observed or suspected. 
This costs, which corresponds to a substantial aggregate cost is destined at combating lack of 
awareness and other socio-cultural factors. However, it is not certain that all employees under 
this  policy  option,  and  particularly  those  in  the  public  sector,  would  need  a  new  training 
annually, which would accordingly decrease, substantially, the total amount of costs.  

Feasibility 

For the adoption of a legal instrument, Article 325 TFEU only requires a qualified majority at 
the  Council.  Moreover,  since  a  large  majority  of  Member  States  have  already  in  place 
legislation  regarding  whistleblower  protection  in  the  area  of  fraud,  the  legal  challenges  to 
adopt this policy initiative are not significant. Implementation would be moreover facilitated 
by the Communication including guidance to national authorities.  

6.3.3.   Policy option 4: Directive introducing whistleblower protection in certain areas of EU 
law 

A. Views of stakeholders 

The  overwhelming  majority  of  stakeholders  are  in  favour  of  a  legislative  EU  instrument 
which would have the broadest possible scope. Stakeholders have also drawn attention to the 
specific EU policy areas where enforcement weaknesses have been identified in this impact 
assessment.  

In the Commission’s OPC, in response to the question in which areas the EU should support 
Member States to better protect whistleblowers, the top four areas cited by respondents were: 

fight against fraud and corruption (95% of respondents); 
fight against tax evasion and avoidance (93% of respondents); 

 
 
  protection of environment (93% of respondents); and 
  protection of public health and safety (92% of respondents). 

In the targeted consultation conducted by the Commission in 2017 with the members of the 
Platform on tax good governance concerning whistleblowing in the field of taxation, fourteen 
out  of  the  eighteen  responses  indicated  that  whistleblowing  in  tax  matters  should  not  be 
protected only through tax-specific rules, rather respondents would instead prefer horizontal 
legislation across all sectors, whether this is addressed by EU legislation (10 respondents) or 
national legislation (4 respondents). 

As  mentioned  in  section  1,  the  European  Parliament  has  repeatedly  called  for  a  horizontal 
legislative proposal establishing a comprehensive common regulatory framework, whilst in in 
the  area  of  taxation,  the  Council  encouraged  the  Commission  to  explore  the  possibility  for 
future action at EU level. 

In the workshops organised by the Commission with Member States' experts and in response 
to the OPC, a few Member States drew attention to the need for any EU legislative initiative 
to  respect  the  principle  of  subsidiarity,  raising  concerns  about  the  existence  of  a  legal 
competence for a horizontal approach.  

52 

 
 
 
B. Effectiveness in meeting the policy objectives 

As indicated previously, the Treaties do not provide a legal basis for regulating the protection 
of whistleblowers in a horizontal way. By providing whistleblower protection in a large area 
of the internal market and other core EU policy areas (as described in Section 5) as well as in 
the area of protection of the financial interests of the Union, the EU legislator would address 
the enforcement weaknesses identified which can cause serious harm to the public interest. In 
addition  to  contributing  to  the  proper  functioning  of  the  internal  market  and  the  effective 
realisation of other EU policies, it would also overall enhance transparency and accountability 
(both  of  the  private  and  the  public  sector)  and  contribute  to  fair  competition  and  a  level-
playing field in the internal market.  

Policy  option  4  targets  through  its  broad  scope  the  specific  policy  objectives  of  increasing 
legal  clarity  and  certainty,  increasing  the  level  of  reporting  and  reducing  retaliation  If 
legislation was adopted in 2017, targeted data of the external study provides for an expected 
increase of more than 200% in the annual number of reports made by whistleblowers in 2022.  

The Directive under this option would bring consistency across the existing EU sectorial rules 
on whistleblower protection, in particular in the field of financial services. Moreover, it would 
contribute  to  better  enforcement  in  those  areas  where  EU  sectorial  legislation  needs  to  be 
complemented  or  where  there  is  no  protection  of  whistleblowers  at  all.  It  is  thus  clear  that 
such  a  legislative  instrument  with  a  broad  scope  is  particularly  apt  to  address  the  current 
fragmentation.  

Moreover, contrary to the discarded option consisting of an instrument aimed at safeguarding 
workers'  health  and  well-being,  option  4  is  clearly  focused  on  key  EU  interests,  so  that  its 
scope can be considered balanced and proportionate. In fact, option 4 would cover, in addition 
to an area where, as indicated in Table 3.1, spill-over impacts of insufficient enforcement are 
very strong (financial interests of the Union), also further areas where such spill-over impacts 
are strong (because they affect the proper functioning of the internal market or result in risks 
that go beyond national borders).  

The  benefits  of  whistleblower  protection  in  each  and  every  specific  area  are  difficult  to 
quantify due to the lack of specific data. The positive impact on the fight  against fraud and 
corruption has already been quantified in Option 3. Some other EU sectorial legislation in the 
area of the internal market provides for estimations of data in terms of benefits. For example, 
in the impact assessment of the implementing Directive providing whistleblower protection as 
a tool to enforce the Market Abuse Regulation, it was estimated that annual benefits in terms 
of  reduction  of  market  abuse  would  reach  EUR  2.7  billion  annually.  Annual  costs  were 
estimated  at  EUR  300  million  (plus  in  the  first  year  estimated  one-off  costs  of  EUR  320 
million to comply with the information obligations)185. 

The  amount  of  fraud  to  public  procurement  that  countries  could  recover  potentially  if  a 
system of effective protection was in place is illustrated in the figure below. For example, in 
the  case  of  the  UK,  the  amount  of  public  funds  that  could  be  potentially  recovered  with  an 
effective whistleblower protection, are estimated between EUR 1.7 and 2.9 billion annually. 

185 

Commission’s impact assessment accompanying the proposal for a Directive of the European Parliament 
and  of 
insider  dealing  and  market  manipulation, 
http://ec.europa.eu/internal_market/securities/docs/abuse/SEC_2011_1217_en.pdf  

the  Council  on  criminal  sanctions 

for 

53 

 
 
 
                                                            
Figure 6.1: Estimated potential benefits (EUR millions) by country 

The benefits of a better enforcement of EU law in other non-financial areas are more difficult 
to quantify since consequences may take the form of risks for the environment, public health 
etc.  By  way  of  example,  in  the  area  of  environmental  protection,  the  Deepwater  Horizon 
disaster  demonstrated  how  far-reaching  the  consequences  of  a  single  accident  can  be, 
particularly as regards maritime and coastal pollution: 11 people lost their lives, an estimated 
4.9  million  barrels  (660,000  tonnes)  of  oil  were  spilled  into  the  sea  and  a  state-of-the-art 
drilling rig, valued at US 560 million, was written off as a total loss in the disaster. The oil 
spill occasioned a response effort involving 48,000 people, 6,500 vessels and 125 aircraft at 
its peak. Total damages are estimated to reach tens of billions of dollars. In early 2011, BP 
estimated  its  costs  related  to  the  accident  (including  costs  incurred  by  the  end  of  2010  and 
estimated obligations for future costs) at 40.9 billion dollars. The company committed to pay 
US$20 billion over a three and a half year period into a Trust Fund out of which legitimate 
claims are met186.   

This policy option, nonetheless, does not target the drivers of underreporting linked to lack of 
awareness and hostile social perceptions towards whistleblowers (see Section 2). 

C. Economic impacts 

(i) 

Impact on the legal system of Member States.  

Although  the  material  scope  of  application  is  different  from  option  3,  the  number  of 
employers that would be targeted by both measures across the EU would be similar187. This is 
why  the  increase  of  costs  as  regards  the  expenditure  on  the  overall  justice  system  is  not 
expected to be high, and would also amount to EUR 34 million under policy option 4. 

As in option 3, the largest costs are estimated to be in Spain, Latvia and Cyprus. 

(ii) 

Costs: economic burdens for public and private employers as well as for Member 
States in terms of adapting to the new legislation.  

The amount of one-off implementation costs for employers in the public and the private sector 
are  similar  both  in  options  3  and  4.  This  is  due  to  the  fact  that  the  number  of  private  and 
public companies caught by both policy options would be similar.  

186 

187 

Impact  assessment  accompanying  the  proposal  for  a  Directive  on  safety  of  offshore  oil  and  gas 
operations. 
For a detailed explanation of the number, see Section 6.4 of the ICF report – Annex 14.  

54 

 
 
                                                            
However, options 3 and 4 diverge regarding the annual operational costs, as a broader scope 
of application entails a broader scope for violations of law to be reported and, potentially, a 
higher number of cases to be analysed and followed up by employers. On this basis, the costs 
for both the public sector and the private sector would amount  EUR 1,336.6 million, which 
represents an increase of 11% of the costs as compared to option 3.  

The costs are summarised as follows: 

Type of Cost 

Public sector 

Private sector 

One-off implementation 
costs  

Annual operational 
costs 

EUR 204.9 million 

EUR 319.9 million 

EUR 542.9 million  

EUR 1,016.7 million 

TOTAL 

EUR 747.8 million 

EUR 1,336.6 million 

The total amount of one-off costs for both the public and private sector is EUR 747.8 million 
while  the  annual  implementing  costs  amount  to  approximately  EUR  1.34  billion.  This  later 
amount  also  includes  a  cost  of  providing  training  of  EUR  722  million,  and  similar 
considerations should be as described under option 3. 

D. Environmental impact 

Effective  whistleblowing  channels  and  protection  that  increase  the  probability  of  violations 
being reported are expected to have a positive environmental impact, in particular by: 

-  Reducing  the  risk  of  specific  events  that  result  in  environmental  damage,  such  as 

negligence or malpractice that causes large scale pollution of water, air or soil; 

-  Reducing  the  loss  of  habitat,  impact  on  wildlife  protection,  and  other  environmental 
damage  caused  by  corruption  and  other  violations  related  to  the  protection  of  the 
natural environment, management of waste, protection of animal welfare, illegal trade 
in wildlife, etc. 

E. Feasibility 

The feasibility of the legal instrument should not be considered as legally complex. The legal 
bases  envisaged  provide  for  an  ordinary  procedure  of  adoption  under  qualified  majority. 
Moreover, this  policy  option  follows  the  approach  adopted so  far  in  existing  instruments  of 
EU  law,  which  is  to  facilitate  whistleblowing  and  protect  whistleblowers  as  a  means  of 
strengthening  compliance  with  EU  law.  In  addition,  the  broad  scope  of  this  policy  option 
would address the expectations of stakeholders and other EU institutions.  

Nonetheless,  unlike  options  2  and  3,  this  policy  option  would  not  be  accompanied  by  a 
Communication  by  the  Commission  and  measures  to  support  implementation,  which  could 
affect the overall effectiveness of the measure.   

6.3.4.   Policy  option  4  Sub  option  1:  Directive  under  policy  option  4  complemented  by  a 
Communication  providing  guidance  to  Member  States  on  key  elements  of  whistleblower 
protection as well as flanking measures to support national authorities 

This  sub-option  would  provide  for  effective  implementation  of  whistleblower  protection  at 
national  level.  The  proposed  Directive  would  be  accompanied  by  a  Communication  which 
would encourage Member States to ensure coherence and legal certainty within the national 
legal  framework  and  promote  measures  that  can  contribute  to  effective  protection  on  the 
ground. The non-regulatory measures would have the same impacts on socio-cultural factors 
contributing to underreporting as under options 2 and 3.  

55 

 
In  the  short  term,  the  increase  in  awareness  and  knowledge  on  how  to  report  violations  or 
abuse of EU law, alongside increased knowledge of the protection afforded to whistleblowers, 
is  expected  to  lead  to  an  increase  in  the  number  of  reported  cases188.  This  increase  in  the 
reporting  of  violations,  alongside  the  rise  in  the  number  of  trained  individuals  who  can 
investigate  cases,  will  lead  to  an  increase  of  investigations  and  prosecutions/actions  against 
violation or abuse of EU law. The increase in knowledge of the whistleblowers' rights is also 
likely to increase the number of whistleblowers who contest retaliatory actions against them. 

The  situation  is  expected  to  evolve  further  over  time.  The  increase  in  prosecutions  and 
punishment for violations of EU law and for retaliation against whistleblowers is expected to 
have  a  dissuasive  effect  both  on  future  violations  and  on  retaliation  against  whistleblowers. 
This  will  ultimately  lead  to  a  relative  decrease  in  the  number  of  reported  cases  and 
investigations and prosecutions/punishment for violations of EU law and retaliation. 

6.4   How do the options compare? 

The  table  below  compares  the  impacts  of  the  policy  options  rated  in  accordance  with  the 
following criteria: 

Criteria 

Effectiveness 

Efficiency meeting 
the specific 
objectives 

Rationale for the assessment 

  To fight underreporting of violations of EU law leading to serious harm to the public 
interest where strong whistleblower protection can significantly contribute to expose, 
prevent and deter such harm 

  To strengthen the protection of whistleblowers and avoid retaliation against them;  

  To provide legal clarity and certainty;  

  To  support  awareness-raising  and  fight  against  socio-cultural  factors  leading  to 

under-reporting; 

Economic costs 

  Administrative costs for public authorities. 

  Administrative and compliance costs for businesses. 

Fundamental 
rights 

  Impacts on the following fundamental rights: protection of personal data; respect for 
private and family life; freedom of expression; freedom to conduct a business; right 
to fair and just working conditions; health care; environmental protection; consumer 
protection,  right  of  defence,  right  to  an  effective  remedy  and  to  a  fair  trial  and  the 
general principle of good administration. 

Proportionality189 

  Overall  adequateness  of  each  of  the  options  towards  the  problem  definition, 

including trade-offs between subsidiarity and costs 

Limitations: 

  For  the  calculation  of  the  benefits  derived  from  an  increase  of  enforcement  of  EU 
legislation  and  a  consequent  reduction  of  violations,  the  conversion  into  points  of  the 
qualitative  assessment  of  the  impacts  transformed  is  used  for  the  sole  purpose  of 
comparing options. Therefore, the total value of benefits derived from an increase on the 
reporting  rate  for  a  given  policy  option  must  be  interpreted  in  relation  to  the  other 

188 

189  

This  is  evidenced  by  data  provided  by  national  authorities  responding  to  the  targeted  stakeholders' 
consultation.  
The legislative options retained (as compared to the discarded options) do not present issues in terms of 
subsidiarity and therefore, subsidiarity has not been included as a criterion to compare the options (i.e. all 
options  would  score  the  same).  The  trade-offs  between  the  areas  covered,  the  costs  and  the  protection 
granted  in  terms  of  overall  citizens  covered  by  the  policy  option  are  analysed  under  the  parameter  of 
proportionality. 

56 

 
                                                            
options, rather than as an accurate estimate of the actual increase of enforcement of EU 
law that a given policy option would cause.  

  The  assumptions  have  a  certain  degree  of  approximation  and  subjectivity.  To  mitigate 
this  shortcoming,  the  methodology,  the  model  and  the  input  data  were  discussed  and 
validated with external experts190.  

Score 

Impact level 

+2.5 to +3.0  Highly positive impact (e.g. the option is likely to result in substantial improvements of the 

capacity to investigate and prosecute violations or abuse of EU law) 

+1.5 to +2.0  Moderate  positive  impact  (e.g.  sectorial  improvement  of  enforcement  of  EU  law,  broader 

increase of protection, etc.) 

+1 

Small positive impact (e.g. limited impact only in very specific sectors) 

-0.5 to +0.5  Very uncertain or insignificant impact 

-3 to -1 

Negative impact (e.g. high increase of the legal complexity or high costs associated)  

The table below summarises the qualitative scores for each main assessment criteria and each 
option. All criteria were given the same weight.  

Policy Option /Cost 

Status 
Quo* 

Policy 
Option 2 

Policy 
Option 3 

Policy 
Option 4 

Policy Option 
4, sub option 
1 

Effectiveness/social 
impact 

Efficiency meeting the 
specific objectives 

Costs 

Impact on fundamental 
rights 

Proportionality 

Total 

0 

0 

0 

0 

0 

0 

+0.5 

+0.5 

-0.5 

+0.5 

+1.5 

+ 2.5 

+2 

+2 

- 2 

+1.5 

+2 

+5.5 

+2.5 

+2.5 

-2.5 

+2.5 

+2.5 

+7.5 

+3 

+3 

-3 

+2.5 

+3 

+8.5 

7. 

IDENTIFICATION  OF  THE  PREFERRED  OPTION: OPTION 4,  SUB  OPTION 1 – ANALYSIS 
 AND OVERALL IMPACTS 

7.1   Analysis  

The analysis in the Section above evidences that Option 4, sub option 1, is the most suitable 
option  to  address  underreporting  and  at  the  same  time  lack  of  protection  and  legal 
fragmentation as well as lack of awareness, and to fulfil the overall objective of ensuring the 
protection of whistleblowers as an upstream component of the enforcement of EU law.  

The scope of Option 4, sub option 1, covers all areas where whistleblower protection has been 
identified as necessary and justified to better enforce EU law and where violations of EU law 

190  

The methodology of the external contractor's study is set out in detail in Annex 3 and Annex 15. 

57 

 
 
                                                            
can cause serious harm to the public interest. The aim of establishing minimum standards of 
protection of whistleblowers is to enhance the proper functioning of the internal market and 
prevent and deter serious harm to the public interest caused by violations of financial services, 
EU competition rules and distortions of competition in public procurement, tax evasion and 
tax avoidance and violations of EU law in core policy areas of importance for the completion 
of  the  internal  market,  such  as  environmental  protection,  nuclear  safety,  food  and  product 
safety,  consumer  protection,  public  health  and  transport  safety,  protection  of  privacy  and 
personal  data  and  security  of  network  and  information  systems.  Additionally,  this  option 
contributes  to  the  fight  against  corruption  and  fraud  affecting  the  financial  interests  of  the 
Union.  The  overall  ancillary  benefit  would  be  that  of  promoting  a  healthy  competitive 
businesses  environment,  transparency  across  the  EU  and  the  protection  of  EU  fundamental 
rights.  

The  legislative  instrument  envisaged  would  also  ensure  consistency  within  the  existing  EU 
sectorial rules already providing for elements of whistleblower protection, particularly in the 
financial  services  area  and  prevention  of  money  laundering  and  terrorist  financing,  while 
preserving, where relevant, the specificities of these instruments. The compliance costs of the 
preferred option, as compared to the other policy options, are the highest. However, Section 6 
explains that it would also generate the highest benefits, which would outweigh the costs191.  

7.2   A balanced approach 

The Directive providing for minimum standards of protection for whistleblowers will include 
all those areas of EU law where: 

1.  there is a need to enhance enforcement; 
2.  there is a causality link between introducing whistleblower protection and increasing 

the reporting rate of violations or abuse of EU law; 

3.  violations or abuse of EU law correspond to serious harm the public interest. 

The  Commission  Communication  will  promote  good  practices  at  national  level  and  set  out 
flanking  measures,  to  promote  the  effectiveness  of  the  whistleblower  protection.  This 
combination  of  regulatory  and  non-regulatory  action  would  thus  respond  to  each  and  every 
single  driver  which  currently  leads  to  a  high  level  of  underreporting  by  potential 
whistleblowers. The right balance would be achieved by combining the benefits of all policy 
options: 

  The benefits of specifically targeted non-regulatory actions under option 2; 
  The  emphasis  on  the  protection  of  the  EU  budget  and  feeding  relevant  national  and  EU 

enforcement mechanisms, under option 3; 

It  is  also  the  only  one  that  can  bring  consistency  in  existing  EU  sectorial  legislation  and 
enhancing enforcement in core areas related to the proper functioning of the internal market 
and  in  the  field  of  environmental  protection,  nuclear  safety,  food  safety,  animal  health  and 
welfare,  product  and  transport  safety,  public  health  and  consumer  protection,  protection  of 
privacy and personal data and security of network and information systems, where spill-over 
impacts of violations of EU law are strong. 

191  

In the US, research estimates that between 1997 and 2001, the ratio of benefits to costs of whistleblower 
provisions was between 14/1 and 52/1, with a mean of 33/1. While the US system is not identical as in the 
preferred option and may include additional incentives for whistleblowers, those figures give an idea of 
the  order  of  magnitude  of 
the  net  benefits.  See  available  data  at:  http://www.world-
psi.org/sites/default/files/documents/research/en_whistleblower_protection.pdf  

58 

 
                                                            
Moreover,  the  preferred  option  best  addresses  the  concerns  expressed  by  stakeholders, 
including an overwhelming majority of the citizens and the European business organisations 
who contributed to the Commission’s OPC192.  

A balanced approach is also ensured in terms of burdens on national authorities. The focus on 
the enforcement of EU law (unlike the discarded option based on Article 153 TFEU) means 
that  individual  reports  about  issues  that  are  not  related  to  the  public  interest  would  not  be 
encouraged, as they would not be considered protected disclosures.   

7.3  Measures of whistleblower protection granted by the preferred option 

The Directive would in one single instrument introduce the minimum common standards set 
out in detail in Section 5.1, summarised under the main categories: 

o  Obligations to establish reporting channels;  
o  Safeguards for the reporting and the concerned persons;  
o  Protection of reporting persons against retaliation;  
o  Ensuring the effectiveness of the framework for protection of whistleblowers. 

The  Communication  would  promote  good  practices  at  national  level  and  set  out  flanking 
measures  to  be  taken  by  the  Commission,  so  as  to  significantly  contribute  to  ensuring  the 
effectiveness of the whistleblower protection.  

7.4 

Proportionality of the preferred option 

The preferred option is consistent with the principle of proportionality: 

  The Impact Assessment shows that enhancing protection of whistleblowers will have 
an overall positive impact on the enforcement of EU law and the revenues of the EU 
through an increased detection of fraud of VAT, customs and other EU revenues; 

  The main current gaps at national and EU level resulting in a fragmented and obscure 
system not providing for an effective protection of whistleblowers will be addressed; 

  The  costs  of  implementation  (i.e.  compliance  with  the  requirement  to  establish 
internal  channels)  for  the  medium-sized  and  large  businesses  are  to  be  considered 
minimal  (see  Section  7.7),  while  the  benefits  in  terms  of  competitiveness  and 
compliance with the law Appear to be substantial. Small and micro-companies will 
be exempted from the obligation to establish internal reporting channels193. Potential 
whistleblower  working  for  those  types  of  companies  will  be  nevertheless  protected 
and will be able to report externally to national authorities directly;  

  Administrative costs for Member States will be relatively small due to the low cost 
of  implementation  of  the  legal  provisions,  since  a  large  majority  of  Member  States 
already have  in  place a sectorial legal framework  and competent authorities, where 
applicable.  Non-regulatory  measures  facilitating  an  effective  implementation  of  the 
legislative instrument will also contribute to reducing this type of costs; 

192  
193  

See Annex 2 for a detailed description on the consultation with stakeholders.  
See the analysis below on SMEs, where costs are not disproportionate and benefits are overall presented 
in terms of competitiveness and reduction of costs of medium and large businesses operating in different 
EU Member States linked to compliance of divergent legal systems.    

59 

 
                                                            
7.5 

Legal basis of the preferred option 

The Directive under the preferred option will be based on Articles 114(1) and 325 TFEU in 
combination with Articles 16, 33, 43, 50, 53(1), 62, 91, 100, 103, 109, 168, 169, 192 and 207 
TFEU and the provisions of the Treaty establishing the European Atomic Energy. These legal 
bases would allow to enhance the enforcement of Union law:  

(i) 

by  introducing  new  provisions  of  whistleblower  protection  so  as  to  safeguard  the 
proper  functioning  of  the  internal  market,  the  correct  implementation  of  Union 
policies related to product safety, transport safety, protection of the environment, food 
safety,  animal  health  and  welfare,  public  health,  consumer  protection,  protection  of 
privacy  and  personal  data  and  security  of  network  and  information  systems,  and  the 
financial interests of the Union;  

(ii) 

to  ensure  consistent  high  standards  of  whistleblower  protection  in  sectorial  Union 
instruments where relevant rules already exist. 

7.6 

Coherence with existing and future EU rules  

Existing EU sectorial rules on whistleblower protection seek to encourage whistleblowing as 
a means of improving enforcement of EU law in the areas concerned by essentially requiring 
Member States: 

(i) 

(ii) 

to  establish  channels  for  reporting  violations  of  the  relevant  rules  guaranteeing, 
amongst others, confidentiality for the individuals concerned;  

to  take  measures  for  the  protection  of  whistleblowers  from  employment-related 
retaliation, referring to threats or hostile action, adverse or discriminatory employment 
actions and other types of unfair treatment.  

The Directive would reinforce the protection provided in all these instruments.  

Finally, while the preferred option covers areas where, based on the data currently available, 
strengthening  whistleblower  protection  is  justified  to  enhance  enforcement  of  EU  law,  this 
coverage  may  need  to  be  reviewed  in  the  future.  To  ensure  that  the  scope  of  the  Directive 
under the preferred option remains up to  date, the Commission  would monitor any possible 
need, in any future Union law where whistleblower protection is relevant and could contribute 
to more effective enforcement, to extend its scope to further areas or Union acts. If evidence 
emerges  which  substantiates  the  need  for  extending  whistleblower  protection  also  to  other 
areas  and  legislative  acts  (including  future  acts),  the  Directive  will  allow  for  the  necessary 
flexibility, by providing for a review process. This will also be given consideration when the 
Commission  reports  on  implementation  of  the  Directive,  explained  under  Section  8  of  this 
Impact Assessment. 

7.7 

Impact on SMEs 

Under  the  preferred  option,  while  whistleblowing  protection  is  offered  to  all  persons  in  a 
work-based context reporting information within the scope of application of the Directive, the 
obligation  to  establish  internal  channels  in  the  private  sector  would  be  imposed  only  to 
medium-sized and large businesses.  

As a general principle, micro and small companies would be exempted from the obligation to put in 
place  internal  reporting  channels.  Notwithstanding,  where  companies’  annual  business  turnover  or 
annual  balance  sheet  exceeds  EUR  10  million  or  where  small  and  micro  companies  operate  in  the 
area  of  financial  services  or  are  vulnerable  to  money  laundering  or  terrorist  financing,  they  will  be 
obliged  to  establish  internal  channels.  This  exclusion  from  the  general  exemption  is  based  on  the 

60 

 
special  case  of  small  companies  with  and  annual  turnover  or  balance  sheet  exceeding  EUR  10 
million,  which  are  de  facto  considered  as  medium-sized  companies.  Moreover,  the  Union 
financial services acquis194 and the Anti-money laundering Directive already provide for the 
obligation to establish internal channels to companies in their respective fields, irrespective of 
their size or annual turnover, due to the specific nature of these companies and the risks of their 
activities.  The  cost  for  those  undertakings  is  minimal  (sunk  costs)  since  they  are  already 
obliged to establish internal reporting channels under existing EU rules.  

Moreover, Member States may also enlarge the list of cases, other than those referred to in the 
paragraph  above,  in  which  small  companies  should  be  obliged  to  set  up  internal  channels. 
However, considering the burdens that such inclusion may entail, the decision of the Member 
States  should  base  its  decision  on  an  appropriate  risk  assessment,  taking  into  account  the 
nature of activities of the entities and the ensuing level of risk, and should communicate such 
decision  to  the  Commission  which  should  be  duly  motivated  with  the  criteria  of  the  risk 
assessment used195.  

The fact that small and micro companies are exempted from including internal channels does 
not  entail  that  individuals  working  in  those  types  of  businesses  would  not  be  protected. 
Rather, due to the size of the company, it is more adequate for the individual to directly report 
externally to competent authorities.  
The  costs/benefits  analysis  of  the  preferred  option196  for  medium-sized  companies  can  be 
summarised as follows: 

  Average costs per medium sized enterprise can be broken down into two types: average 
implementation  cost  (one-off)  amounting  estimated  at  EUR  1,374  and  average  annual 
operational cost estimated at EUR 1,054.6197.  

  While overall costs appear significant, the individual cost per business does not appear to 
be highly burdensome in economic terms (with incremental annual costs estimated at less 
than  0.01%  for  the  average  EU  added  value  medium-sized  enterprise  turnover  in  all 
Member States)198.  

  The  benefits  on  the  other  hand  are  expected  to  be  highly  counted.  The  employers  will 
benefit from improved disclosure of violations of EU law and the long-run performance 
and  productivity  gains  associated  with  good  governance  standards,  where  now  they  are 

194  

195 

196 
197 

198 

See  for  example,  the  obligations  under  Directive  2014/56/EU  of  the  European  Parliament  and  of  the 
Council  of  16  April  2014  amending  Directive  2006/43/EC  on  statutory  audits  of  annual  accounts  and 
consolidated accounts. 
This  option  allows  for  flexibility  of  the  future  Directive  to  the  regimes  of  whistleblowing  protection 
already established at national level. For example, under the Swedish Law small and micro companies are 
not automatically excluded from the obligation to provide for internal channels and need to perform a risk 
assessment to evaluate its needs in the light of its activities. Depending on the nature of these activities, 
the  employer  may  have  to  put  in  place  specific  measures  to  facilitate  internal  reporting.  In  the 
Netherlands,  the  system  allows  for  reporting  to  the  trade  unions  as  an  alternative  measure  to  internal 
reporting channels for small and micro companies.  
For a detailed explanation of the specific costs, see the section relating to the SME test under Annex 11. 
See,  in Annex 11,  a  specific  case study  for  Sweden, based  on  the  information  provided  in  their  impact 
assessment  when  drafting  the  national  law  on  whistleblower  protection.  While  the  figures  of  the  case 
study differ from the ones presented in the Impact assessment due to a different calculation of the labour 
costs, the Swedish case also evidences that the impact on medium-sized companies would be low. 
Added value of medium-sized companies is estimated according to the Commission to amount up to EUR 
5.568.737.  The  EU28  data  on  SME 
is  available  at 
http://ec.europa.eu/DocsRoom/documents/22382/attachments/10/translations  

(non-financial  business  economy) 

61 

 
                                                            
lacking. Moreover, the working conditions will improve, which for workers means higher 
feeling  of  security  and transparency  and  thus  higher  health and  wellbeing.  An  enhanced 
system  of  protection  of  whistleblowers  will  generally  result  in  a  reduction  of  costs 
generated  by  fraud,  bribery  and  lack  of  legal  compliance,  which  overall  increases  the 
competitiveness in the Internal Market.  

8.  MONITORING AND EVALUATION 

In  the  proposed  legislation,  the  Commission  will  include  a  commitment  to  submit  an 
implementation report assessing the situation of transposition to the European Parliament and 
the  Council  2  years  after  the  deadline  of  transposition.  This  will  ensure  that  there  is  a 
sufficient period of time to evaluate the new legislation and that data is collected to determine 
the level of implementation of Member States as well as the effective EU added value.   

An  additional  report  evaluating  the  effectiveness,  efficiency  and  overall  coherence  in 
enforcing EU law would be submitted 6 years after the deadline for transposition, taking into 
account the implementation report cited above and statistics submitted annually by Member 
States. The report shall allow for a review also as regards the material scope of application of 
the Directive. This way, if, in the future, evidence comes to the fore substantiating the need 
for whistleblower protection as a means of strengthening the enforcement of Union law also 
in other areas and legislative acts (including future acts) the Commission will consider, within 
this report, the need for additional measures, including, where appropriate, amendments with 
a view to extending whistleblower protection to further areas or Union acts 

In  order  to  carry  out  an  evaluation  in  this  regard,  benchmarks  are  established  to  reflect 
progress both in the transposition and in the implementation of the future Directive: 

  Benchmark  as  regards  the  state  of  transposition  of  the  Directive  in  the  Member  States 
between years 1 to 3, after the transposition deadline: 30% of the Member States should 
correctly  transpose  and  implement  the  Directive.  This  benchmark  will  be  mainly 
measured based on the transposition report due on the second year after transposition as 
well as the reports coming from the civil society organisations and internal organisations  

  Benchmark as regards the increase of the number of reports between years 1 to 5 after the 
deadline of transposition: 10% increase of the number of reports. This benchmark will be 
mainly  measured  based  on  the  annual  data  submitted  by  the  Member  States  and 
complemented with the data provided by other actors, such as OLAF.  

  Benchmark  as  regards  the  outcome  of  the  whistleblower  cases  reported,  particularly  as 
regards cases of retaliation: a decrease of retaliation cases 5-10%  from  year 1 to  5 after 
transposition deadline. This benchmark will be mainly measured based on the annual data 
submitted  by  the  Member  States  and  complemented  with  the  data  provided  by  other 
actors, such as OLAF. 

  Benchmark  as  regards  perceptions  on  the  futility  of  reports  as  established  in  the  EU 
Eurobarometer on Corruption: 10% decrease from years 1-5 after transposition deadline. 

  Benchmark  as  regards  the  awareness  of  citizens  on  the  existence  of  a  system  of 
whistleblowing protection and where to report in their Member State: 10% increase from 
years 1-5 after transposition deadline. 

Benchmarks  cannot  be  established  as  regards  the  baseline  scenario  since  currently  Member 
States  do  not  –  or  very  rarely  –  collect  data  on  whistleblower  protection.  Therefore 
benchmarks are established from the first year after the transposition deadline.  

62 

 
In order to feed the future implementation report and to assess the targeted benchmarks, the 
future Directive will include an obligation to Member States to collect data on the number of 
whistleblowers  reports,  on  the  numbers  of  procedures  triggered  as  a  result  of  reporting  by 
whistleblowers, on the areas of law concerned, as well as on the outcome of the procedures 
and their economic impact in terms of recovery of funds and on reported cases of retaliation. 
This set of data will in turn feed the current reports of OLAF and could be complemented by 
the reports of EPPO and the EU Ombudsman.  

Secondly, the above data collection will be complemented by other relevant sources of data, 
such  as  the  Commission’s  Eurobarometer  on  Corruption  and  the  implementation  reports  of 
the existing EU sectorial legislation providing whistleblower protection.  

Finally,  other  tools  provided  by  external  stakeholders,  such  as  NGOs,  think  tanks  and 
consultants,  will  also  be  used,  if  relevant.  Independent  academic  research  and  studies  on 
whistleblowing  in  the  EU  can  usefully  complement  the  data  collection  exercise  in  order  to 
have a contextualised set of information. 

Furthermore,  in  the  evaluation  report  the  Commission  would  include  a  list  in  which  its 
specified: a) between years 1 to 5 of transposition, the Union instruments not included in the 
Directive  that  had  included  a  reference  to  the  applicability  of  the  Directive  and  (ii)  list  of 
areas that would need to be included in the scope of application of the Directive, since there is 
a need to enhance enforcement and whistleblowing protection is yet not provided in that area. 
For point (ii), in order to determine the areas, the Commission could base its assessment in the 
sectorial reports on implementation or impact assessments. 

All  these  tools  and  gathering  of  data  would  enable  the  Commission  to  evaluate  the 
effectiveness and efficiency of the new system of protection of whistleblowers, contributing 
to the general assessment of whether support on implementation is further needed in order to 
ensure an effective, proportionate and dissuasive action against violations of EU law. 

63 

 
Table 8.1. Monitoring of specific and operational objectives 

Objectives 

Monitoring indicators 

Sources of data 
and/or collection 
methods 

Actors 
responsible for 
data collection 

  To  address  underreporting  of 
violations  of  EU  law  leading  to 
serious harm to the public interest 
in 
strong 
can 
whistleblower 
significantly contribute to expose, 
prevent and deter such harm. 

where 
protection 

areas 

  To strengthen the protection of 
whistleblowers and avoid 
retaliation against them; 
  To provide legal clarity and 

certainty;  

  To support awareness-raising and 
fight against socio-cultural factors 
leading to underreporting. 
  To fill the legal gaps in the 

protection of whistleblowers 
across the EU. 

  To implement measures to ensure 
effective support and protection of 
whistleblower. 

  To implement measures to ensure 
effective support and protection of 
whistleblower. 

General 

Specific 

Operational 

  Number of reports submitted to public authorities by 

whistleblowers and type of concerns raised; 

  Number of administrative and criminal investigations 
that have been triggered with information provided by 
whistleblowers; 

  Number of administrative and criminal investigations 
that had been feed with information provided by 
whistleblowers; 

  Number of administrative  and criminal sanctions that 
have been triggered or have been supported by the 
action of whistleblowers;  

  Number of cases resulting in criminal prosecutions that 
have been triggered or have been supported by the 
action of whistleblowers. 

  Percentage of whistleblowers who, after reporting have 

experienced some form of retaliation. 

  Percentage of workers who, when suspecting 

violations of EU law, would be willing to report 

  Number of Member States adopting or amending 

existing legislation. 

  Number and type of dedicated internal and external 
channels established by law and measures to protect 
from retaliation; 

  Number and type of actions aimed at awareness-raising 
carried out by Member States and EU institutions. 

64 

  Annual reports 
of OLAF and 
EPPO; 

  Commission’s 
surveys on 
corruption 
addressed to 
both companies 
and citizens. 

  European 

Commission; 

  OLAF, based 

on information 
submitted 
annually by MS 
authorities and 
law 
enforcement; 

  Civil society.  

 

Information on 
transposition 
and 
implementation 
provided by the 
national 
authorities after 
deadline. 

  European 

Commission;  

  Member States’ 
authorities and 
law enforcement;  

  Civil society. 

Benchmarks 

  Between years 1 to 5 after the deadline 
of transposition: 10% increase of the 
number of reports; 

  Between years 1 to 5 after the deadline 
for transposition: 10% decrease of the 
perceptions of EU citizens relating to 
the futility of reports as established in 
the EU Eurobarometer of Corruption. 

  Between years 1 to 5 after the deadline 
for transposition: decrease of 5-10% of 
cases of retaliation due to the reporting. 
  Between years 1 to 5 after deadline for 
transposition: increase of 10% the 
awareness of citizens who know of the 
existence of a system of whistleblowing 
protection and where to report.  

  Between years 1 to 3 after the deadline 
for transposition: 30% of the Member 
States should correctly transpose and 
implement the Directive