Case Summary and Outcome

A Luxembourg Court  handed down suspended jail sentences and fines in the trial of Antoine Deltour and Raphaël Halet, two French whistleblowers who were former employees of PricewaterhouseCoopers (PwC) responsible for exposing Luxembourg’s giant system of tax avoidance for multinationals.

Columbia Global Freedom of Expression could not identify official legal and government records on the case and information on the case was derived from secondary sources. Global FoE notes that media outlets may not provide complete information about this case. Additional information regarding legal matters will be updated as an official source becomes available.

Facts

Antoine Deltour and Raphaël Halet, both former employees of PricewaterhouseCoopers (PwC), leaked documents which exposed the numerous tax avoidance arrangements that Luxembourg’s authorities had struck with some 340 companies including corporate giants such as Ikea, Pepsi, Walt Disney and Apple. [3] These arrangements helped these companies save billions of dollars in taxes, according to the leaked documents and in some cases tax payments were minimized to 1% or less. Edouard Perrin, a French journalist who hosted a television program called ‘Cash Investigation’ was the first to report the information from the leaks. [4]

In 2014, the leaked documents were published by the International Consortium of Investigative Journalists (ICIJ), revealing a huge scandal which implicated authorities all the way up to Jean-Claude Juncker, the former Luxembourg Prime Minister and current President of the European Commission. [1] The revelations caused EU regulators to expand tax subsidy probes, propose new laws to fight corporate tax evasion and create a committee to investigate fiscal deals all across the European Union. [3]

In the wake of the revelations, Deltour, Halet, and Perrin were charged in this case that was soon labeled the Luxleaks case. Perrin was charged with violating business secrecy and confidentiality,whilst Deltour and Halet were charged with theft, breach of confidentiality and business secrecy, computer fraud, laundering, and disclosure of business secrets.[1]

At trial, prosecutors argued that Deltour was an “anti-capitalist” and demanded a sentence of up to 18 months in prison. PwC was also present at trial and pressed for a conviction on the grounds that what had occurred constituted theft and not whistleblowing. [2] The prosecutors also argued that with regard to Perrin, journalistic freedom of expression should be subordinate to professional secrecy even when it bears witness to questionable practices. [1]

[1] Le Monde, LuxLeaks: suspended sentence for French whistleblowers, (Jun. 30, 2016), http://www.lemonde.fr/europe/article/2016/06/29/luxleaks-au-luxembourg-verdict-attendu-pour-les-trois-lanceurs-d-alerte-francais_4960591_3214.html

[2] The Guardian, LuxLeaks whistleblower avoids jail after guilty verdict, (Jun. 29, 2016), https://www.theguardian.com/world/2016/jun/29/luxleaks-pwc-antoine-deltour-avoids-jail-but-is-convicted-of-theft

[3 ] RT, LuxLeaks trial: Corruption watchdog says sentence increases fears for whistleblowers, (Jul. 3, 2016), https://www.rt.com/news/349343-luxleaks-whistleblowers-jail-fine/

[4] RSF, RSF deplores jail terms for LuxLeaks whistleblowers, (Jun. 30, 2016) https://rsf.org/en/news/rsf-deplores-jail-terms-luxleaks-whistleblowers

Decision Overview

The Luxembourg Court found Deltour guilty of both theft and violating Luxembourg’s professional secrecy laws. He was given a suspended sentence of 12 months in prison and fined €1,500. Halet was convicted of the theft of fewer tax deal papers and received a suspended sentence of nine months and fine of €1,000. [2] The court acquitted Edouard Perrin holding that he was lawfully doing his work as a journalist. [1]

The convictions notwithstanding, the Court acknowledged that the revelations by Deltour and Halet had contributed to greater transparency and fiscal equity, and that they had acted in the general interest and against the practices of morally questionable tax optimization and could thus be considered whistleblowers. [1]

[1] Le Monde, LuxLeaks: suspended sentence for French whistleblowers, (Jun. 30, 2016), http://www.lemonde.fr/europe/article/2016/06/29/luxleaks-au-luxembourg-verdict-attendu-pour-les-trois-lanceurs-d-alerte-francais_4960591_3214.html

[2] The Guardian, LuxLeaks whistleblower avoids jail after guilty verdict, (Jun. 29, 2016), https://www.theguardian.com/world/2016/jun/29/luxleaks-pwc-antoine-deltour-avoids-jail-but-is-convicted-of-t