By Ida Nowers (Whistleblowing International Network) and Emanuel Delia (Blogger with a special interest in Malta politics)
In 2019, the European Union adopted a landmark Directive on Whistleblowing requiring Member States to undertake sweeping reforms to encourage and protect individuals who report wrongdoing. EU governments had until 17 December 2021 to ‘transpose’ the Directive into their national legal systems.
The mission to harmonize whistleblower protection across Europe via common minimum standards however is far from realised. As of today (15 December 2021), two days before the official deadline, only a handful of countries have passed new laws - Denmark, Sweden, and Portugal. There have been reports online of a new law in Austria, but there is no official information available. While government delays in implementing Union rules are commonplace, and the transposition period coincided with the challenges of the pandemic, encouraging those with information about potential harm to speak up should have been a priority for EU governments. Putting transposition on the backburner was dangerous given the increased risks both of public safety and corruption during Covid19.
Whistleblowing International Network (WIN) and Transparency International (TI) were aware of these delays and analysed progress and the approach governments were taking just over halfway into the two-year transposition period. Over two thirds (18 of 27) had either not started at all or had made minimal progress. While some countries demonstrated good open practice by engaging in wide stakeholder and public consultation on intentions and draft proposals, this was in stark contrast to the secrecy in others. Malta is a case in point.
Malta’s Bill – a sudden development
On the 15 November 2021 - a month prior to the deadline - Malta published a new Bill entitled ‘Att dwar il-Protezzjoni ta’ Informatur’ or ‘Protection of the Whistleblower Act’. The draft law purports to transpose the Directive by amending the current legislation that has been in place since 2013.
Despite some media reports of progress announced by the Minister for Justice, Edward Zammit Lewis, no official information was publicly available. In fact, until the sudden publication of a draft law last month, Malta was still listed as one of four countries ‘not started’ on the EU Whistleblowing Monitor along with other outliers - Luxembourg, Cyprus and Hungary.
Public institutions in Malta had already highlighted the severe lack of stakeholder consultation when it came to implementing a new legal framework. In 2020, Maltese ombud’s institution, the ‘Uffiċċjutal-Ombudsman Parlamentari,’ stated in its annual report that a new obligation to handle private sector whistleblower reports would conflict with the limited powers it had under the Ombudsman Act to investigate reports within public administration. Commenting again on the lack of consultation for the transposition Bill the 2021 report stated:
“The Ombudsman would be failing if he did not record his disappointment at this complete failure of consultation. This is to prevent such incidents from happening again.”
Despite this, and the repeated public calls from Repubblika - a civil society organisation in Malta focused on the rule of law - for the government to meaningfully engage with stakeholders and civil society, the government did not take heed. As feared, the bill has now been forced through, and early analysis of its provisions does not bode well for protecting whistleblowers in Malta.
Early analysis of the new law is not optimistic
Upon first assessment of the Maltese law, a fundamental flaw may undermine the entire project. The proposed scope of the law would only protect individuals who report to specified formal whistleblowing units. In comparison, the UK which adopted the first dedicated whistleblowing legislation in Europe in 1998, a public interest disclosure internal to the employer is protected if made to ‘any responsible officer’ or anyone ‘reasonably believed to be responsible for the wrongdoing’ allowing for ordinary raising of concerns to line management the same protection as reports made via the whistleblowing procedure. A similar broad approach is found in Ireland and France.
Worse still, the new units to handle disclosure do not have any of the guarantees for independent channels free from conflicts of interest with access to organisational leadership necessary for credibility, and safety for whistleblowers.
Further, Malta’s experience since the introduction of the first Whistleblower Protection legislation in 2013 has shown that the effective control the government has on the competent authority that was set up to decide whether whistleblower ‘status’ is to be awarded to individuals reporting wrongdoing has made the law entirely unworkable. Potential witnesses have faced material consequences as a result of information they provided to support their application for whistleblower status and applications have been rejected, possibly because acceptance would have impacted the interests of those enjoying considerable influence over the decisions of the competent authority. The new law does not correct this serious problem.
Another worrisome loophole which threatens now to undermine whistleblower rights in Malta is found in problematic provision for evidential proof requirements to be successful in enforcing rights. Whilst the Directive is clear that burdens of proof should be reversed so that the onus is on the employer to show any detrimental treatment was not in any linked to the reporting of wrongdoing, the specific qualified exclusion of retaliation where it is “justifiable for administrative or organisational reasons” that is specifically included in the Maltese law is an easy claim for most employers to prove, thus failing to offer the protection foreseen by the EU Directive.
Whilst the new law may seem an improvement to the current system on paper, loopholes as significant as those set out above will undermine trust and confidence in the protection, with people more likely choosing to stay silent or suffering for speaking up and creating a chilling effect on potential whistleblowers in the future.
Malta’s legislative whistleblower protection framework has so far proven entirely ineffective. The law was only applied once in a case which failed to lead to any convictions of the wrongdoers and was severely criticised by the courts as forensically baseless, and from outside the courts as a politically motivated attempt to discredit an opposition MP. Potential whistleblowers in major corruption scandals involving senior government officials including Malta’s prime minister, have either been denied whistleblower protection or have said they have been advised not to rely on the level of protection provided by law.
In September, the Network of European Integrity and Whistleblowing Authorities NEIWA - of which no Maltese authority is a member - adopted a declaration calling on EU legislatures to ensure correct transposition of the Directive, specifically recommending that external reporting channels set up by the competent authorities have the sufficient organisation and financial resources and autonomy needed to perform their functions robustly and where protection status is foreseen under national law, ensure reporting persons are granted it. The case of Jonathan Ferris highlights the dilemma faced by potential witnesses to wrongdoing in Malta who risk punishment ranging from dismissal from their employment to imprisonment if they reveal information that could lead to the prosecution of corruption before they are granted whistleblower protection.
The EU Rule of Law reports on Malta for 2020 and 2021 both observed that there has been a “rather limited” use of the framework which suggests it is inadequate in meeting its core objective of protecting potential whistleblowers from the risk of retribution. The new Bill does not address these fundamental concerns.
Tom Devine, Legal Director of the Government Accountability Project based in Washington DC and a founding member of WIN states:
“Whilst the new Maltese transposition legislation is sophisticated, it is like a train with all the bells and whistles but a defective, dangerous engine. As a whistleblower adviser for 43 years, I would warn anyone that relying on these rights is like spending time and money to hammer the last nail in their own professional coffin. Behind all the gaudy cosmetics, this law is a Trojan horse.”
Whistleblower protection is a matter of fundamental human rights
It is worth noting that the legal protections enshrined in EU Directive exist in parallel to the whistleblowing rights which have evolved under the European Convention of Human Rights (ECHR) and jurisprudence of the Court (ECtHR). Whistleblowers are afforded special protection under Article 10 ECHR rights to freedom of expression and the public’s right to know. The Directive explicitly draws upon the case law of ECtHR as well the principles developed by the Council of Europe in the Committee of Ministers Recommendation (CM/Rec/2014/7) on the protection of whistleblowers. All 27 EU member states are also members of the Council of Europe, including Malta.
The Council of Europe Recommendation is clear that there should be few barriers to reporting concerns about wrongdoing or risks internally, that protection against retaliation should be as close to automatic as possible (see Principle 15 and paragraph 63 of the Explanatory Memorandum) and that the choice of channels for reporting or disclosing information must be flexible to the individual as each set of circumstances will be different (Principle 14). It also makes it clear that reports or disclosures should be investigated promptly, and the results acted on by the employer, appropriate regulatory body, law enforcement or supervisory body in an efficient and effective manner (see Principle 19). The Recommendation has been in place since 2014 and it is time for Malta to take the protection of whistleblowers seriously as a matter of freedom of expression and democratic accountability.
In our view, Malta is in particular need of an effective whistleblower protection framework that encourages those who witness wrongdoing to speak up and to expose suspicions of illicit or unethical practices. Whistleblower protection is a key tool in any meaningful effort to combat corruption. Whistleblowing has been found to be the single most effective method to uncover fraud – in its impact assessment for the Directive, the Commission calculated that the lack of whistleblower protection in the area of public procurement alone amounted to in the range of 5.8 and 9.6 Billion euro annually. It is estimated that total cost of corruption across the EU is between 179 and 990 billion in GDP each year.
Over the last few years Malta has earned a reputation as being unwilling or unable to combat institutionalised corruption particularly in the public sector. It has been said that Malta has a ‘shadow economy’ and has experienced a ‘corruption nosedive’ scoring just 53% on TI Corruption index. Malta is considered a gateway to EU, yet it is estimated that it loses at least 11 % of its GDP to corruption every year and the country has been grey-listed by the Financial Action Task Force.
If Malta remains unable to clean up its act, a vulnerability exists for the global financial system and particularly for the EU. In order to stop Malta being exploited as a backdoor to Europe for financial criminals and international organised crime, whistleblowers who expose weaknesses in controls or complicity in wrongdoing must be fully protected.
In its 2019 evaluation report on Malta, the Council of Europe’s GRECO urged Malta to review its whistleblower protection rules. The recommendations by GRECO are not reflected in the new Bill.
The assassination of the Maltese journalist Daphne Caruana Galizia on 16 October 2017 was a wake-up call in Europe and an horrific reminder of Malta’s vulnerability to organised crime, a damaging culture of collusion and cover-up linked to the highest political levels. This means there are serious risks to people who work to expose uncomfortable truths, including whistleblowers. At the time it presented its proposal for a new directive to protect whistleblowers, Frans Timmermans, the Vice-President of the European Commission stated in April 2018 that the proposals would help to ensure that freedom of expression and freedom of the media are defended in Europe and protect those who act as sources for investigative journalists. In relation to this we recall the experience of Maria Efimova, one of Daphne Caruana Galizia’s sources who had to flee Malta because of the risk to her safety after she blew the whistle on the wrongdoing of her employer Pilatus Bank. Maria Efimova has been awarded special recognition for her whistleblowing yet she remains ineligible for whistleblower protection in Malta and is still being pursued by the Maltese authorities.
Urgent intervention is needed today
Repubblika, with the support of the EU Whistleblowing Monitor partners, the Whistleblowing International Network, Transparency International EU and Eurocadres, express their dismay at the actions of the Maltese Government to push through flawed amendments that do not meet the standards nor fulfil the spirit of the EU Directive to protect whistleblowers. We jointly call on the Maltese authorities to urgently conduct a broad, transparent, and effective consultation on what is needed to protect whistleblowers in Malta and ensure a correct transposition of the EU Directive.
The text of the EU Directive can be read here.
Addendum: Other countries criticised for their approach to transposition.
In the Netherlands, civil society have urged for quality over speed and serious concern for the Dutch approach to implementation, which had ignored all comments and consultation recommendations to fix significant damaging effects of the minimalistic approach and resulting hybrid reporting framework. Legal experts in other countries have warned of legal absurdities such a ‘verbatim’ transposition would create and experts are now publicly urging for the Dutch draft to be sent back for significant revision. The Commission have already stated that provisions to allow for exceptions in the obligations on corporate groups to establish confidential channels, as seen in the Danish Bill, equate an ‘incorrect transposition.’
This article was first published 24 March 2021 was the first in a series of blog posts to launch Transparency International & the Whistleblowing International Network's joint report Are EU Governments Taking Whistleblower Protection Seriously? Progress Report on Transposition of the EU Directive. By Marie Terracol, Transparency International and Ida Nowers, Whistleblowing International Network
Whistleblowers are the heroes of our troubled times and whistleblowing is one of the most effective ways to uncover corruption and other harm to the public interest. Yet all too often, those who speak up face personal risk and retaliation in the form of dismissal, blacklisting, legal harassment and even physical harm.
Since the COVID-19 emergency began, constant concerning reports of threats against health care professionals speaking out about the realities of the pandemic have emerged across Europe, from Poland to the Czech Republic to Slovenia. Widespread corruption in health care and public procurement during the pandemic highlights just how much we need whistleblowers to expose abuses to safeguard public health and funds. With government spending going through the roof, from millions of euros to purchase health equipment to billions in economic stimulus packages, it is more essential than ever to ensure public funds are allocated democratically and reach intended beneficiaries.
In times of crisis, wrongdoing costs lives, and normal oversight and accountability mechanisms are seriously weakened. It is important and urgent, to ensure that those who become aware of misconduct speak up, without fear of retaliation, and that these concerns are acted on.
Robust legislation is vital to protect whistleblowers and ensure reports of harm are addressed. In 2019, the European Union adopted a Directive on Whistleblower Protection. 27 EU Member States have until 17 December 2021 to comply with its standards, by “transposing” it into their national law. The Directive contains many ground-breaking provisions that, if properly implemented, will improve weaknesses and fill important gaps in protection across most EU countries.
However, EU governments must avoid a minimalistic (or verbatim) approach to the transposition. Member States should seize this opportunity to go beyond the minimum standards required by the Directive and adopt comprehensive national legislation that meets international best practice principles. This is the only way to commit to protecting every single whistleblower speaking up in the public interest.
Minimal, delayed or even incorrect implementation of the Directive could further endanger and discourage whistleblowers. To ensure governments take whistleblower protection seriously, Transparency International and the Whistleblowing International Network are monitoring the transposition process across all 27 Member States closely, and today published a report looking at progress one year and two months into the two-year timeframe.
By 17 February 2021, two-thirds (18) of member states had not started or had made minimal progress towards implementing the Directive. And it is uncertain whether any EU country will complete transposition by the December deadline.
This lack of urgency is concerning. Corruption and other serious harm to the public exposed during the pandemic, and the huge amounts of relief funds at stake, should spur EU member states into immediate action. Unfortunately, they seem to have done the opposite. Whilst it is understandable that governments are currently dedicating significant resources to dealing with COVID-19, it would be a mistake to think implementing whistleblowing legislation is not a high priority during a health emergency. The very purpose of such legislation is to enhance the enforcement of law and policies, thus preventing loss or harm and preserving the rule of law. Critical times, such as those we are living through today, only accentuate that need.
With less than nine months left until the deadline, all EU countries, and especially those which have made minimal or no progress towards transposing the Whistleblower Directive, must intensify their efforts.
A sense of urgency, however, should not mean governments rush through flawed legislation just to meet the deadline, skipping important steps and ignoring stakeholders. In several countries, transparency and inclusiveness in the transposition process is seriously lacking. Without proper consultation with all relevant stakeholders – including civil society organisations, trade unions and journalists’ associations – national legislation is unlikely to offer effective protection in practice.
It is worrying that some countries are not fully embracing the recommendation of the EU Commission and whistleblowing experts and seize the opportunity to adopt comprehensive and coherent legislation.
The Czech Republic, Denmark and Sweden are to be commended for adopting a broad scope, but still fall short of best practice when defining what whistleblowers will be able to safely report. Estonia and Latvia are leading the way in that regard by deciding, so far, in favour of legislation covering a wide and coherent scope of whistleblowing situations. Serious debates on the issue of scope are ongoing in other countries, such as Germany and Finland.
In the Netherlands, the draft bill curiously foresees parallel reporting procedures for breaches of EU law and breaches of national law, with different obligations for those handling them.
EU governments must urgently adopt whistleblowing laws which provide high-level protection, beyond the minimum standards of the Directive, to ensure every single whistleblower is encouraged and supported in speaking up in the public interest. They should also prioritise a transparent and inclusive transposition process. Only then can whistleblower protection laws across the EU be fit-for-purpose and live up to the promise of the Directive.
Read Transparency International and WIN’s report Are EU Governments Taking Whistleblower Protection Seriously? Progress Report on Transposition of the EU Directive.
Marie Terracol is the Whistleblower Protection Lead at Transparency International and Ida Nowers is the Law and Policy Coordinator at Whistleblowing International Network.