Anyone who has ever attended one of our courses or webinars knows that LuxLeaks was one of the triggers for the European directive to protect whistleblowers. The European Court has now fully acquitted both LuxLeaks whistleblowers.
In 2014, Antoine Deltour and Raphaël Halet of PwC leaked confidential information about favourable tax deals by multinationals in Luxembourg to journalists. Through these secret so-called ‘tax rulings’, multinationals such as IKEA, Apple, Amazon, AIG, Deutsche Bank, Pepsi and many others managed to save billions in taxes. PwC helped multinationals set up complex structures and obtained more than 500 ‘tax rulings’ between 2002 and 2010.
As Deltour and Halet had breached their confidentiality clauses by disclosing this information to journalists, they were prosecuted. At first instance, they were sentenced to 12 and 9 months in jail respectively, as well as to pay EUR 1,500 in fines. On appeal, the jail sentence was reduced to a suspended sentence. They then took the case to the European Court of Human Rights, where both have now finally been acquitted in full. However, this did take almost 10 years.
At first, this looked to be a typical whistleblower story, with companies acting illegally or unethically, receiving large fines and legislation being changed under public pressure. As such, the European Commission tried to roll back a number of regulations, which was not always successful. However, partly in response to LuxLeaks, some 130 countries did agree in 2021 that they would, going forwards, charge a minimum tax rate. The impact of the whistleblowers’ action was significant, but the whistleblowers themselves ended up rather poorly.
For Deltour and Halet, it became a matter of principle to challenge their punishment to the highest instance, supported in part by funds raised by activists for this purpose. The European Court eventually ruled that the public interest and freedom of expression were more important than the confidentiality clauses in this case. And Luxembourg was ordered to pay Halet’s legal costs of EUR 55,000.
In 2018, when the European Commission published its proposal for a European directive to protect whistleblowers, explicit reference was made to LuxLeaks. But also to Dieselgate, the Panama Papers and the Facebook/Cambridge Analytica scandal. All brought to light by whistleblowers with major societal consequences. The aim of the EU Directive and the Whistleblowers Protection Act is therefore to better protect the honest people of Europe, so that serious wrongdoing can be discovered and dealt with at an earlier stage. And whistleblowers like Deltour and Halet should no longer be prosecuted or face other forms of retaliaton.
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