Whistleblowing: The Hidden Weapon of EU Antitrust Enforcement

The following article explores the vital weapon of antitrust enforcement that is used to expose cartels, monopolistic practices, and other hard-to-detect violations of antitrust law. Antitrust whistleblowing encompasses the practice of individuals (employees, customers, etc.), companies (suppliers, etc.), or even rivals, reporting suspicious behaviors harming competition law to EU or national competition authorities. Recognizing the relevance of whistleblowing is essential to further elaborations on its impact for antitrust law.

The importance of protecting whistleblowers

Many of the antitrust law violations happen behind closed doors. Due to that secrecy, competition authorities may struggle to detect and react to such violations swiftly. Taking into account the hidden nature of violations, as well as the fact that an average European cartel lasts for more than 8 years, whistleblowing may serve as an efficiency-gaining mechanism allowing competition authorities to spot antitrust law violations early on.

It is important to note that whistleblowers may face retaliation, such as being at risk of losing a job or facing legal action for exposing a trade secret. The European Commission notes that the 2017 Eurobarometer found that 81% of respondents did not report corruption and that fear of legal and financial consequences were some of the main reasons for remaining silent.It is regrettable, especially given the fact that whistleblowers may have internal information regarding internal communications, strategies, (in)formal agreements, and other behaviors. Moreover, whistleblowers may possess valuable documents or give oral testimonies to the competition authorities, which may further support authorities’ investigations. Thus, it is of no surprise that the EU has adopted Directive No 2019/1937 on the protection of persons who report breaches of Union law, which recognizes that whistleblowers “play a key role in exposing and preventing such breaches and in safeguarding the welfare of society.” It protects current, former and future employees who possess information acquired in a work-related context. Moreover, the Directive stresses that without whistleblower protection there will be “lower attractiveness for investment and (...) an uneven playing field for all businesses across the Union.” All of these reasons reflect how vital it is to protect whistleblowers at the EU level.

How does whistleblowing work at the EU level?

Whistleblowing can be done voluntarily in anonymous and non-anonymous ways. The latter can be done via normal email or call. The former can be sent through an anonymous encrypted platform, which ensures that authorities can follow up on a message without revealing the whistleblower’s identity. Relevant evidence includes but is not limited to, internal documentation, emails, testimonies, and meeting notes. A whistleblower report can trigger an entirely new investigation or support an ongoing case with additional evidence.

It is crucial to stress that active participants in cartels need to make a leniency application rather than a whistleblower application due to their engagement in the crime. Unlike whistleblower programs, which allow individuals to report anti-competitive behavior they know of, the leniency program is targeted at businesses actively involved in the cartel which are willing to cooperate with competition authorities. The level of immunity or reduction in fines depends on when and how much the company contributes to the investigation.

---

Conclusion

Whistleblowing allows for increased effectiveness and efficiency for the enforcement of antitrust law in the EU. Moreover, the option for whistleblowers to remain anonymous, encourages increased reporting, which will lead to uncovering unlawful practices. The adoption of the 2019 Directive is an important step in protecting such identity throughout the Community. As awareness and trust in the system grow, whistleblowing may well become a cornerstone of modern antitrust enforcement.

CC: Justyna Michalak