No protection for whistleblowers – The EU is once again siding with the big multinational tax evaders

With 503 votes in favor and 131 against the european parliament approved a new European directive that protects multinationals from “digital crime”. The new directive can be used to penalize any activity done by online journalists and activists such as  The International Consortium of Investigative Journalists/Panama papers, Wiki Leaks, Luxleaks, Anonymous, and any other media that  publicize such leaked revelations.

Who voted in favour and who against the directive? According to our sources, this is how the different political groups in the EU parliament voted: left (GUE/NGL) against, Greens against, centre-left Socialists & Democrats (S&D) in favour, liberals (ALDE) are divided, centre-right (EPP) in favour, conservatives (ECR) in favour with some exceptions, EFDD – the Italian 5 star movement and British UKIP – against, and the group “Europe of Nations and Freedoms” (French National Front and allies), in favour.

The European Commission that proposed the directive, represented by MEP Constance Le Grip (EPP) argued that the directive “protects the professional expertise and intangible heritage of businesses and that this directive is aimed at protecting small businesses that do not have strong data protection systems ‘. The proposed Directive on Trade Secrets Protection is meant to repress industrial espionage, write Corporate Europe Observatory & Co-signatories.

But under its Draconian provisions, punitive lawsuits, jail sentences and €350,000 fines await journalists, campaigners and whistle-blowers. The proposed EU legislation on ‘Trade Secrets Protection’ creates excessive secrecy rights for businesses. It is a direct threat to the work of journalists and their sources, whistle-blowers, employees’ freedom of expression and EU citizens’ rights to access public interest information – on medicines, pesticides, car emissions, etc.

This directive given to the member states and its incorporation into national legislation aims to assist national courts in the fight against “unfair” use of corporate information and to ensure compensation for the “victims of such illegal practices,”. This is how the initiators justified this directive. Clearly all they want to protect is the multinationals, where they should be protecting the common interest and the interests of the people they were voted by. It is at least hypocritical to claim that they are trying to protect the small businesses! So far they have done nothing to protect the small businesses, why should they start caring now?

And is it a coincidence that this directive comes out right after the Panama Papers revelations? Who the European Commission really protecting? Because it is definitely not the small businesses…. or the small people.

With this directive, from now on, all disclosures will be considered illegal wiretapping and intercept activity and those who reveal or disclose tax evasion cases for example, will be officially prosecuted, according to EU legislation. Noted that all the lists of tax evaders already circulating in Greece will be by law considered products of wiretapping and therefore illegal, inadmissible and condemnable.

We had no doubt that fraud and tax evasion is a strategic choice and fundamental practice of capitalism and neoliberalism.  In this historical time where totalitarian neoliberalism is attacking the middle  and working class in Europe, the EU officials, instead of protecting their citizens and fighting for more transparency, they serve as puppets of big money, by protecting corporate interests and helping impose austerity policies that harm the majority of the people.

As journalists, lawyers, researchers, consumers and citizens we are very concerned about the considerable legal uncertainties created by the proposed EU Directive on Trade Secrets Protection.

This text is meant to repress industrial espionage but abuses its purpose by applying to the whole of society legal remedies that should only apply to economic entities (competitors). Indeed, many member states today criminalise trade secrets theft within an unfair competition legal framework.

Draconian Transatlantic suppression of citizens’ rights

Aren’t trade secrets usually defined as “a secret formula, method, or device that gives one an advantage over competitors”?

Unfortunately, the definition chosen by the European Commission, in line with the TRIPS agreement and the US regime, derives from an intellectual property legal framework and is blind to context and intentions. In that sense, the ‘harmonisation’ sought by the European Commission derives much more from the US regime than what currently dominates among EU member states.

Indeed a comparable text is currently going through the US Congress, which would lead to a de facto legal harmonisation of trade secrets protection legislation on both sides of the Atlantic and facilitate the negotiations of the TTIP chapter on intellectual property.

According to the draft directive, a ‘trade secret’ is an information which is secret, and whose secrecy has commercial value and has been reasonably well protected. It means: “information which meets all of the following requirements:

(a) is secret in the sense that it is not, as a body or in the precise configuration and assembly of its components, generally known among or readily accessible to persons within the circles that normally deal with the kind of information in question;

(b) has commercial value because it is secret;

(c) has been subject to reasonable steps under the circumstances, by the person lawfully in control of the information, to keep it secret;”

This definition is so broad that it can include almost any internal information, pending the settling of case law.

By the corporations, for the corporations?

Therefore, the text would create a situation where secrecy is the legal norm for companies’ internal information and transparency the exception.

It would offer private companies a right to sue anyone who would acquire, use or publish any information or document they consider a trade secret even if this person has no economic intention or motives.

This is not needed to fight industrial espionage, but is rather a big gift offered to all companies to prevent independent scrutiny of their products and behaviour.

The fact that this text was drafted at the request of and with considerable help of multinational companies, but in the complete absence of public debate and participation, might explain this situation.

The consequence would be that judges will have to balance crucial political rights and considerations, such as employees’ mobility, innovation, press freedoms and the right and need to access and publish certain proprietary information in the public interest (whistle-blowers but also scientists willing to test the safety of products on the market) with the economic interests of trade secret owners.

Since the European Commission published its initial proposal, additional protections and exceptions have been added by the European Parliament to try to better protect, notably, employees’ mobility, journalists and whistle-blowers. However, these exceptions are insufficient in the sense that they do not prevent the opening of lawsuits on grounds of trade secrets violation.

As intellectual property lawyers put it: “with the EU Trade Secrets Directive, we will need to wait for rulings from the [European Court of Justice] to see whether the exceptions will present serious problems for trade secret owners.” And this will take many years, during which the legal situation will remain unclear.

Not maximum, but minimum penalties

What will be the risks for the persons prosecuted? This Directive only sets minimum standards and member states are free to go further.

The scandalous criminal measures (jail term and €350,000 fine) foreseen by the French government in January 2015, when it tried to introduce key elements of this Directive into French law, could be re-introduced at member state level with this text, with opportunities for companies to use the most favorable national regime for legal action in the EU.

With companies protecting their reputation more and more aggressively, whistle-blowers are becoming the last sources of inside information on the brutality of corporate practices. As the recent Panama Papers demonstrated, such sources of information can be immensely useful to the public interest.

Is this the Europe we want…?