Case Summary and Outcome

The Grand Chamber of the European Court of Human Rights ruled that Luxembourg violated the freedom of expression of Raphaël Halet, a former employee of PricewaterhouseCoopers—and a whistleblower involved in the Luxleaks scandal—who faced criminal convictions for disclosing tax-related documents to the media, exposing favorable tax agreements between the Company and Luxembourg authorities. The Court emphasized key criteria for protecting whistleblowers under Article 10 of the European Convention on Human Rights, including the authenticity of disclosed information, good faith, public interest, and a fair balance between public interest and potential harm. Criticizing the national courts’ narrow interpretation of public interest and insufficient consideration of all detrimental effects, the Grand Chamber concluded that the criminal conviction and fine imposed on Halet were disproportionate and not “necessary in a democratic society.” Thus, the Court found a violation of Article 10 and awarded compensation to Halet.

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Facts

Raphaël Halet, the applicant, is a former employee of PricewaterhouseCoopers, a company that provides auditing, tax advice, and management consultancy services. The Company also provided further services such as drawing up tax returns for and on behalf of its clients, and requesting advance tax rulings from the tax authorities also known as “Advance Tax Agreements”, “tax rulings,” or “tax rescripts.” The applicant, while working at the Company, held a position of responsibility, coordinating a team involved in obtaining favorable tax treatment for clients from the Luxembourg tax authorities.

Between 2012 and 2014, numerous Advance Tax Agreements (ATAs) and tax returns prepared by the Company were leaked to the media. These documents highlighted favorable tax agreements between the Company, acting on behalf of multinational companies, and the Luxembourg tax authorities. Following that, an investigation was conducted. It was revealed that on October 30, 2010, a former auditor had copied 45,000 pages of confidential documents, including 20,000 pages of tax-related material. These were handed over to a journalist in 2011. Subsequently, a second internal investigation identified the applicant, who had approached the same journalist in 2012, offering additional documents. This second transfer included fourteen tax returns and two cover letters.

On November 5-6, 2014, the Luxleaks scandal unfolded when sixteen documents were posted online by the International Consortium of Investigative Journalists, causing a challenging year for PricewaterhouseCoopers. On December 2, 2014, a settlement agreement between the applicant and the Company was reached, with the Company limiting its claims to a symbolic one euro and gaining authorization to register a 10 million euro mortgage on the Applicant’s assets. The agreement also outlined the applicant’s dismissal, which occurred on December 29, 2014, after a notice period.

Following the Settlement Agreement, the Company filed a Complaint against the applicant, auditor, and the journalist who published the story. On June 29, 2016, the Luxembourg District Court convicted the auditor and the applicant for theft, fraudulent access to a data processing system, breach of commercial and professional secrecy, as well as money laundering and possession. The Court awarded a 12-month suspension prison term to the auditor and a EUR 1,500 fine, and the applicant was awarded a 9-month suspension prison term and a EUR 1,000 fine. The Court acquitted the journalist on the reasoning that he was found not to have participated as a co-perpetrator or accomplice in breaches of secrecy. 

The applicant and auditor filed an appeal before the Court of Appeal. On March 15, 2017, the Luxembourg Court of Appeal dismissed the appeals filed by the auditor and the applicant against their convictions in the Luxleaks case. The court noted that the charges related to theft from the employer, fraudulent access to a data-processing system, breach of professional secrecy, and laundering of the proceeds. The Attorney-General argued against the application of Article 10 of the Convention, emphasizing the breach of professional secrecy by the defendants. The Court of Appeal upheld the charges of theft, fraudulent access, and breach of professional secrecy while dismissing the charges of breach of commercial secrecy. The court also highlighted the absence of statutory whistleblower protection in Luxembourg and emphasized the importance of balancing freedom of expression with the protection of professional secrecy. The applicant and auditor filed an Appeal before the Court of Cassation.

On January 11, 2018, the Luxembourg Court of Cassation dismissed the applicant’s appeal on points of law, affirming the Court of Appeal’s rejection of whistleblower status. The Court of Cassation found the Appellate Courts’ assessment of the relevance of the documents handed over by the applicant to be sufficient and free of contradiction. However, in a contrasting decision, the Court of Cassation allowed the appeal of the auditor, quashing the Court of Appeal’s judgment. The Court of Cassation held that whistleblower status should be recognized for all offenses related to the exercise of the right guaranteed by Article 10 of the Convention, leading to the auditor’s acquittal for offenses related to documents handed over to the journalist. In response, the Court of Appeal acquitted the auditor under Article 10 for the offenses connected to documents handed over to the journalist in 2011 but upheld the previous judgment for offenses related to internal training documents.

The applicant applied to the European Court of Human Rights (ECtHR). The Third Chamber of the ECtHR found no violation of the right to freedom of expression under Article 10 of the European Convention of Human Rights (Convention/ECHR). The ECtHR determined that the applicant could be considered a whistleblower under the Court’s case law. The Chamber evaluated whether the national Courts adhered to the criteria outlined in the case of Guja v. Moldova, (2018), focusing on the balancing of public interest against the harm to the employer and the severity of the penalty.

It concluded that, despite no dispute on the first four criteria, the Court of Appeal’s assessment of the disclosed documents as lacking essential new information was reasonable. The Chamber found that the Court of Appeal carefully considered the evidence and, in light of established criteria, reasonably determined that the disclosed documents did not sufficiently justify the harm caused to the Company. Regarding the severity of the penalty, the Chamber deemed the imposed fine relatively mild, leading to the conclusion, by a majority vote, that there was no violation of Article 10 of the Convention.

Subsequently, the case was decided by the Grand Chamber of the ECtHR.

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Decision Overview

Justice Robert Spano of the Grand Chamber wrote the majority opinion. Justice Georges Ravarani, Justice Stéphanie Mourou-Vikström, Justice Lado Chanturia, and  Justice Raffaele Sabato wrote a joint dissenting opinion. Justice Jon Fridrik Kjølbro wrote a separate dissenting opinion. The primary issue before the Grand Chamber was to determine whether the criminal conviction amounted to a disproportionate interference with the applicant’s right to freedom of expression under Article 10 of the Convention.  

The applicant contended that the domestic courts, particularly the Court of Appeal, failed to properly apply the criteria established in the Guja judgment to determine his whistleblower status. He criticized the Court of Appeal’s sequence of examination, asserting that it first verified the constituent elements for whistleblower protection before concluding that he did not qualify as a whistleblower. The applicant contended against the Court of Appeal’s isolated application of the “Guja criteria,” stressing the need for a global analysis based on Article 10 that considers all relevant criteria. He challenged the Court of Appeal’s interpretation of the “detriment to the employer” criterion, arguing that this standard, applied to private-sector employees, may unjustly favor the employer’s interests over the whistleblower’s freedom of expression. The applicant called for the Court to abandon the “detriment to the employer” criterion, suggesting that the main risk to whistleblowers is criminal rather than disciplinary sanctions and proposing a definition of whistleblowers along with a presumption in their favor. Moreover, he urged the Court to go beyond the Guja case law, emphasizing the need for a comprehensive definition of whistleblowing and a genuine whistleblower status. 

Furthermore, the applicant emphasized aligning the Court’s interpretation with the European Union Directive on the protection of whistleblowers, which does not link protection to harm caused to the employer. He contended that the Court should play a role in reviewing the grounds and criteria used by domestic courts, asserting that the Court of Appeal did not appropriately consider the interaction between whistleblower protection as lex specialis and Article 10 as lex generalis. Finally, the applicant contended that accepting the Court of Appeal’s findings would seriously undermine the effectiveness of whistleblower protection under Article 10 of the Convention.

On the other hand, the Government rejected the applicant’s request for a modification of the Court’s whistleblower case law, asserting that the existing criteria, particularly those outlined in the Guja judgment, were appropriately applied by the domestic courts. It contended that the national margin of appreciation was respected, and the domestic courts scrupulously adhered to the Court’s requirements for whistleblower protection. The Government argued that the balancing exercise performed by the domestic courts, specifically regarding the fifth “Guja criterion” concerning the public interest versus employer detriment, was correctly executed. They highlighted the limited public interest in the applicant’s disclosures and emphasized that the damage inflicted on the employer’s rights, professional secrecy, and protection of reputation justified the criminal conviction, refuting any violation of Article 10 of the Convention. Additionally, the Government opposed the applicant’s suggestion that the protection of whistleblowers should extend to subsequent disclosures, arguing that the exceptional nature of whistleblower protection, as defined by the Court, should be maintained to prevent unwarranted breaches of confidentiality and contractual relations. Finally, they asserted that the Court’s principle of subsidiarity should be upheld, and the domestic courts’ decisions, based on exhaustive examination and in-depth investigations, should be respected unless there were weighty grounds for intervention.

The Court also noted the third-party submission by Maison des Lanceurs d’alerte, Media Defence, and Whistleblower Netzwerk EV. Maison des Lanceurs d’alerte expressed concern about the potential impact on whistle-blower protection if domestic Courts were allowed to assess the disclosure based on the criteria of “essential, new, and previously unknown information.” Maison des Lanceurs d’alerte argued that such criteria would create legal uncertainty for whistle-blowers, making it practically impossible for them to comply and undermining the effectiveness of whistle-blower protection. Maison des Lanceurs d’alerte highlighted the importance of effective whistle-blowing to effective media coverage, as it often served as a necessary precondition for initiating public-interest debates. It emphasized the need for intelligibility and predictability in whistle-blower protection systems, asserting that the proposed criteria would hinder the watchdog role of whistle-blowers and long-term institutional changes.

Media Defence underscored the significant impact the case could have on investigative journalism, particularly in light of increasing pressures on journalistic sources. It emphasized the crucial role whistle-blowers play as journalistic sources, disclosing information vital to the public interest. Media Defence pointed to an OECD report highlighting whistle-blower protection as the ultimate line of defense for safeguarding the public interest. They stressed the importance of a clear and coherent legal protection framework for whistle-blowers to avoid any chilling effect on investigative journalism.

Whistleblower Netzwerk E.V. (WBN) contended that the “essential, new, and previously unknown” criterion was contrary to international protection standards and the Court’s existing case law, potentially stripping whistle-blowers of their legal protection and introducing legal uncertainty. WBN acknowledged the need for clarification of the “Guja criteria” in light of increasing whistle-blowing cases but insisted on preserving the existing protection framework. They also highlighted differences between the Court’s case law and the European Directive, suggesting that conflicting interpretations might weaken the force and effectiveness of Convention law. WBN emphasized the essential role of legal certainty in protecting whistle-blowers from severe retaliation.

The Court observed that both parties acknowledged that the conviction of the applicant constituted an interference with the applicant’s freedom of expression. The interference, the Court held, was prescribed by law and it pursued at least one of the legitimate aims listed in Article 10 (2) of the Convention, namely the protection of the reputation or rights of others, in particular the protection of the Company’s reputation and rights. The Court noted that the crucial question for the Court was to determine whether the interference was deemed “necessary in a democratic society.”

The Court referred to Hertel v. Switzerland, (1998) and Steel and Morris, (2005) to outline the established principles regarding the necessity of interferences in a democratic society with the exercise of freedom of expression. It noted that freedom of expression is a cornerstone of a democratic society, applicable not only to favorable or uncontroversial information but also to that which may offend or disturb. The Court highlighted the need for restrictions to be construed strictly, with any interference requiring a convincing demonstration of a pressing social need. The Court’s supervisory jurisdiction included assessing whether restrictions are proportionate, considering the content of statements, and examining the context in which they were made.

The Court further delved into general principles concerning freedom of expression within professional relationships. It established that Article 10 protection extends to the workplace, emphasizing that the genuine exercise of freedom of expression may require positive protective measures [Kudeshkina v. Russia, (2009)]. The Court identified a set of criteria, first introduced in the Guja case, to assess whether disclosures of confidential information by employees or civil servants merit protection under Article 10. These criteria include the availability of alternative channels for disclosure, the public interest in the disclosed information, the authenticity of the information, the detriment to the employer, the whistle-blower’s good faith, and the severity of the sanction. The Court noted the duty of loyalty, reserve, and discretion in employment relationships and recognized a positive obligation of states to protect freedom of expression, even against interference by private entities. [Bucur and Toma v. Romania, (2013); Gawlik v. Liechtenstein, (2021); and Heinisch v. Germany, (2011) ]

The Court underscored the importance of a fair balance between freedom of expression and the limits imposed by loyalty and discretion in employment contracts. It clarified that in cases where no issues of loyalty, reserve, and discretion arise, the Court does not inquire into alternative channels for disclosure. Additionally, the Court highlighted the distinction between genuine whistle-blowing and disclosures made without privileged or exclusive access to information, without apparent secrecy obligations, and repercussions at the workplace. 

In the context of the Guja criteria and their application, the Court underscored the importance of stability and foreseeability in its case law for legal certainty. Thus, the Court acknowledged the evolving role of whistle-blowers in democratic societies and the developments in the European and international legal framework for their protection. The Court seized the opportunity presented by the referral to the Grand Chamber to confirm and refine these principles.

On the first criterion from the Guja case i.e., the channels used for disclosure, the Court emphasized the priority given to internal reporting channels, stating that disclosure should initially be made to the person’s superior or other competent authority. The internal hierarchical channel is deemed the best means to reconcile the duty of loyalty with the public interest served by disclosure. However, the order of priority is not absolute, and the Court recognized circumstances justifying the direct use of external reporting. These circumstances include unreliable or ineffective internal reporting channels, potential exposure to retaliation, or when the disclosed information is crucial to the employer’s activities. The Court, following the jurisprudence it set in Gawlik v. Liechtenstein, left open the question of whether the obligation to use internal reporting channels first is absolute, referring to guiding principles that don’t establish a strict order of priority between reporting channels. The assessment of the reporting channel is to be done in light of the specific circumstances of each case.

On the second criterion from the Guja case i.e., the authenticity of the disclosed information, the Court underscored its pivotal role in evaluating the necessity of interference with a whistle-blower’s freedom of expression. While acknowledging the duties and responsibilities accompanying freedom of expression, the Court clarified that whistle-blowers cannot be obligated, at the time of reporting, to definitively establish the authenticity of disclosed information. Emphasizing the inherent challenges faced by individuals in possessing the full picture, the Court aligned with the principle that subsequent investigations might reveal a whistle-blower’s initial information to be mistaken. Despite such uncertainties, the Court advocated for protecting whistle-blowers against retaliation, especially when disclosing information based on a reasonable belief that later proved to be incorrect. The Court asserted that diligent verification efforts by whistle-blowers should warrant protection under Article 10 of the Convention, even if the information is subsequently proven inaccurate. The Court also referenced the concept of good faith, highlighting that whistle-blowers acting with reasonable grounds to believe in the accuracy of their disclosure, without pursuing unlawful objectives, should be considered to have acted in good faith. The responsibility lies with whistle-blowers to act responsibly by seeking to verify the authenticity of the information before making it public, thereby ensuring they qualify for the protection granted by Article 10 of the Convention.

On the third criterion of the Guja case i.e., good faith, the Court reiterated the significance of the motive behind a reporting employee’s actions in determining the protection of a particular disclosure. The Court consistently examined whether the whistle-blower was motivated by personal advantage, held grievances against the employer, or had any ulterior motives. Assessing good faith involved scrutinizing the content of the disclosure, ensuring it lacked gratuitous personal attacks. The Court also considered the addressees of the disclosure, appreciating instances where the whistle-blower sought internal remedies before resorting to public attention. The criterion of good faith was closely linked to the authenticity of the disclosed information, with the Court emphasizing the importance of the whistle-blower’s belief in the truth of the information and its public interest. However, the Court held that a lack of evidence to support allegations could undermine a claim of good faith, as seen in specific cases like Soares v. Portugal, (2016).

On the fourth criterion of the Guja case i.e., the public interest in the disclosed information,  the Court underscored the importance of assessing whether the information disclosed by a whistle-blower was in the “public interest.” The Court established that the concept of public interest should be evaluated considering both the content of the disclosed information and the principle of its disclosure. It broadened the scope of information deemed of public interest, encompassing matters related to political debate, improper conduct by high-ranking officials, government surveillance practices, suspicions of serious offenses, institutional care shortcomings, and controversial conduct by armed forces. The Court emphasized that the public interest assessment should consider national, European, or international levels, acknowledging the varying degrees of interest in different situations. Importantly, the Court highlighted that the public interest cannot be determined solely on a national scale, recognizing the potential relevance of certain information at supranational levels. This comprehensive approach aimed to ensure a nuanced evaluation of whether the disclosure served a legitimate public interest, emphasizing a case-specific analysis.

On the fifth criterion of the Guja case, focusing on the detriment caused, the Court emphasized the need to weigh the employer’s interests against the public interest in the disclosed information. Acknowledging that disclosures could harm public authorities, state-owned companies, and private entities, the Court expanded the scope of the detriment criterion. The Court considered the potential damage to professional reputation, business interests, and public confidence in institutions. Importantly, it recognized that disclosures could have broader consequences affecting public interests such as the wider economic good, protection of property, and citizens’ confidence in the fairness of state policies. The Court refined the balancing exercise, considering the overall detrimental effects of the disclosure, including financial, reputational, and other potential consequences. Relevant case laws in this context referenced by the Court include Guja, Bucur and Toma, Heinisch, and Steel and Morris. [para. 145-148] 

On the sixth criterion of the Guja case, focusing on the severity of the sanction, the Court recognized that sanctions against whistle-blowers could manifest as professional, disciplinary, or criminal measures. It highlighted the serious nature of dismissal without notice, acknowledging its adverse impact on the whistle-blower’s career and the chilling effect on other employees. The Court underscored the gravity of criminal penalties, emphasizing the need for restraint in resorting to criminal proceedings. It noted that the use of criminal proceedings to punish whistle-blowers might be incompatible with freedom of expression, considering its repercussions on individuals and the chilling effect on others. The Court referred to its jurisprudence in Gawlik, Guja, Bucur and Toma, Stoll, Bédat, Marchenko, and Wojczuk, and emphasized the importance of considering the nature and severity of the imposed penalties in assessing the proportionality of interference with the right to freedom of expression.

Applying the principles, the Court evaluated how domestic courts implemented whistle-blower protection under Article 10 and ruled on its compatibility with established principles and criteria in its case law. The Court noted that the Court of Appeal’s assessment of the facts revealed a subsidiary review conducted with diligence and a clear acknowledgment of the direct effect of the Convention in domestic law. The Court underscored its role in ensuring that national courts apply Convention principles consistently and observed an increased expectation for national courts to consider its case law, particularly when it provides substantial and stable guidance. The Court emphasized the importance of detailed reasoning by domestic courts and a careful examination of facts in light of established human rights standards.

The Court recognized the Court of Appeal’s efforts in applying its case law on the protection of whistle-blowers’ freedom of expression. It commended the Court of Appeal for faithfully applying the Guja criteria, even leading to the acquittal of certain charges against the applicant. The Court emphasized that the national authorities endeavored to provide detailed reasoning, taking into account the principles established in its case law.

Regarding the implementation of the Guja criteria, the Court addressed each criterion successively, starting with the existence of alternative channels for disclosure. It affirmed that in situations where an employer’s activities are legal but may be of public interest, direct recourse to external reporting channels, including the media, may be necessary for effective whistle-blowing. The Court praised the Court of Appeal’s finding that the applicant had no realistic alternative and that informing the public through the media was justified.

The Court confirmed the authenticity of the disclosed information, the applicant’s good faith, and his lack of intent to harm the employer. The Court then turned to the balancing of the public interest in the disclosed information against the detrimental effects of the disclosure. The Court clarified that, in this case, the conflict was not between rights but rather required an examination of the fair balance between competing interests. The Court insisted on the importance of a global analysis of all Guja criteria, without establishing a hierarchy between them. It asserted that its role was to ascertain whether the domestic Courts struck a fair balance between the public interest in disclosed documents and the harmful effects arising from their disclosure. The Court reiterated that the domestic authorities must provide sufficiently detailed reasons for their decisions. In examining the context of the impugned disclosure, the Court considered the background as crucial in assessing the weight of the public interest. It rejected the requirement that the disclosed information must be “essential, new, and previously unknown,” emphasizing that ongoing public debates may draw on additional information.

On the issue of conducting a detailed analysis of the balance between the public interest in the disclosure of information and the potentially detrimental effects resulting from the actions of the whistleblower, the Court began by emphasizing the general principle that taxation is a matter of public interest, citing previous cases that acknowledged the relevance of information about taxation data to public debate. The Court acknowledged the Court of Appeal’s conclusion that the whistleblower’s revelations were of public interest, contributing to a broader discussion on corporate taxation, tax transparency, and fairness. The Court disagreed with the applicant’s assertion that the Court of Appeal had restricted the scope of public interest in the disclosure and emphasized that the purpose of whistleblowing is not only to reveal information but also to bring about change.

The Court considered the information disclosed, including tax returns, as contributing to the transparency of multinational companies’ tax practices. It emphasized the importance of the ongoing debate on tax evasion, transparency, and tax justice triggered by the initial disclosures. The Court found that the disclosed information provided fresh insight and contributed significantly to public opinion on complex issues related to corporate taxation. Regarding the detrimental effects, the Court held that the damage sustained by the whistleblower’s employer should not be assessed solely based on the financial impact. It acknowledged reputational damage but noted that no long-term damage had been established. The Court also examined whether other interests were affected, including those of the Company’s clients and the public interest in maintaining professional secrecy.

The Court criticized the Court of Appeal for not considering all detrimental effects and focusing solely on the harm to the Company. It emphasized the potential prejudice to the private interests and reputations of the multinational companies whose names were revealed. Additionally, it recognized the public interest in preventing and punishing theft and respecting professional secrecy. In the balancing exercise, the Court concluded that the public interest in the disclosure of the information outweighed all detrimental effects. It underscored the importance of the information to the national and European debate on tax practices. The Court also highlighted the relative weight of the disclosed information, considering its nature and the risk associated with its disclosure. Finally, the Court addressed the severity of the sanction imposed on the whistleblower. It expressed concern about any undue restriction on freedom of expression, particularly in the context of whistleblowers, and emphasized the potential chilling effect on future revelations. The Court considered the criminal conviction and fine of EUR 1,000 disproportionate, especially in light of the legitimate aim pursued and the conclusion reached after weighing up the interests involved.

After considering all relevant interests and evaluating the nature, severity, and chilling effect of the applicant’s criminal conviction, the Court concludes that the interference with his freedom of expression, particularly the freedom to impart information, was not deemed “necessary in a democratic society.” Thus, the Court held that there had been a violation of Article 10 of the Convention and awarded 15,000 Euros (16,360 USD approximately) to the applicant.

Joint Dissenting Opinion of Justice Georges Ravarani, Justice Stéphanie Mourou-Vikström, Justice Lado Chanturia, and  Justice Raffaele Sabato

In the joint dissenting opinion of Justice Ravarani, Mourou-Vikström, Chanturia, and Sabato, the judges expressed their disagreement with the majority’s finding of a violation of Article 10 of the Convention in the case of Halet v. Luxembourg. The dissent acknowledged agreement with certain aspects of the majority’s judgment, particularly the need to revisit the criteria for whistle-blower protection outlined in the Guja case law. However, the dissenting judges expressed reservations about the expansion of the concept of “public interest” in the majority’s decision, particularly concerning the disclosure of information about the functioning of public authorities. They argued that the new criterion is excessively vague and risks undermining professional secrecy without providing clear guidelines for potential whistle-blowers and prosecution authorities.

The dissenting judges criticized the majority for departing from established principles, devaluing professional secrecy, and creating confusion in the criteria for whistle-blower protection. They argued that the majority’s judgment unnecessarily introduced uncertainty and failed to provide clarity, leaving both whistle-blowers and prosecution authorities with difficult choices and uncertain outcomes. Furthermore, the dissent questioned the majority’s assessment of the specific facts of the case and suggested that the domestic courts, in their application of the Guja criteria, remained within their margin of appreciation and did not breach Article 10 of the Convention.

Dissenting Opinion of Justice Jon Fridrik Kjølbro

In Judge Kjølbro’s dissenting statement, he expressed his disagreement with the majority’s finding of a violation of Article 10 of the Convention, specifically concerning the “second Guja criteria” regarding the public interest in disclosed information. Justice Kjølbro opposed the Court’s expansion of protection for whistle-blowers to include information that sparks debate and controversy about potential harm to the public interest. He further emphasized his disagreement with the majority’s application of this new general principle to the specific circumstances of the present case. Despite his dissent on these points, Justice Kjølbro opted not to provide additional legal arguments and confined his statement to a “declaration of vote.”

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