European Commission reflects on establishment of whistleblower program as a tool to combat cartels

Written on 1 Oct 2015

The European Commission has indicated that it is currently deliberating the introduction of a new whistleblower program. The program would allow informants to channel information regarding cartel behaviour through an independent agency to the Commission. Speaking at a conference on 30 September 2015, the Commission’s director of cartels, Eric Van Ginderachter, stated that the Commission will be making a decision as to whether it wishes to adopt a new program in the coming months; he recognised that having an open dialogue with informants in the context of cartel tip offs provides more value than the current model.

As the process currently stands, informants can tip off the Commission by contacting them directly. However, the Commission cannot then follow up with the whistleblower as their identity remains anonymous. Under the new proposals, the informant would disclose the information to an independent agency and a dialogue between the Commission and the informant could then take place. This approach would protect the identity of the whistleblower while allowing the Commission to access valuable information and assess whether a full investigation should be launched. This model has already been successfully adopted by a number of countries, including Germany and Denmark.

Currently, the majority of the Commission’s investigations into cartel behaviour are triggered under its leniency program, whereby the first company engaged in a cartel to “blow the whistle” (i.e. provide comprehensive information on the cartel to the Commission) will be given full immunity from fines. However, this new program may mean that cartel behaviour can be discovered through third party tip-offs without any of the cartelists involved having the opportunity of applying for full immunity.

It is equally plausible that this type of leniency program may increase the overall number of third party tip-offs, as dealing with an independent agency coupled with the reassurance of their identity being protected may encourage more individuals to come forward.

Further announcements are expected from the Commission in the coming months on whether a new leniency program will be adopted.