Who should implement the Whistleblower Protection Procedure?

The Whistleblower Protection Act of June 14, 2024, introduces new rules for protecting individuals who report legal violations (so-called whistleblowers). These rules impose obligations on a wide range of entities, both in the public and private sectors.

Unfortunately, the legislator has not explicitly indicated the catalog of entities required to implement the procedures. Therefore, it is necessary to refer to the regulations mentioned in the various provisions of the Act, including, in particular, the Anti-Money Laundering and Terrorist Financing Act of March 1, 2018.

Below, we will discuss who is obligated to implement the procedures and outline the legal basis for the new regulations.

Legal Basis

The primary legal basis for the Whistleblower Protection Act is the Directive (EU) 2019/1937 of the European Parliament and Council of October 23, 2019, on the protection of persons who report breaches of Union law (the so-called Whistleblower Directive). The Directive aims to ensure protection for individuals reporting irregularities in various areas of EU law, such as public procurement, environmental protection, public health, consumer rights, data protection, and combating money laundering and terrorist financing.

In Poland, the implementation of this Directive occurred through the adoption of the national Whistleblower Protection Act, which came into force on September 25, 2024. Additionally, a significant complement to the provisions regarding whistleblower protection is the Anti-Money Laundering and Terrorist Financing Act of March 1, 2018. Both laws impose obligations on financial, legal, and other entities that may be witnesses or participants in reporting legal violations.

Who Does the Whistleblower Protection Act Apply To?

The Whistleblower Protection Act applies to a range of entities, including private companies, public sector units, and individuals performing regulated professions. Here’s a detailed review:

1. Private Companies

According to Article 23, paragraph 1 of the Whistleblower Protection Act, all companies employing at least 50 employees are required to implement internal procedures for receiving reports of irregularities. However, according to Article 23, paragraph 3 of the Act, the employment threshold does not apply to entities operating in particularly sensitive sectors, such as:

1. providing services, products, and financial markets;
2. counteracting money laundering and terrorist financing;
3. transport safety;
4. environmental protection;
5. covered by the scope of EU legal acts listed in parts I.B and II of the annex to Directive 2019/1937.

2. Public Sector Units

Article 23, paragraphs 4-5 of the Act imposes the obligation to implement procedures for reporting irregularities on all public sector units, including administrative offices, educational units, health protection units, and cultural institutions. Each public unit must designate a person responsible for receiving reports and ensure appropriate communication channels.

3. Entities Subject to AML Obligations

As previously mentioned, the list of entities that should implement whistleblower procedures is derived, among others, from the Anti-Money Laundering and Terrorist Financing Act (AML).

Certain professionals, such as notaries, lawyers, legal advisers, foreign lawyers, tax advisors, accountants (under the AML Act), as well as insurance intermediaries, currency exchange businesses, real estate brokers, postal operators, and pawnshop operators, are subject to these obligations.

Additionally, procedures should be in place for:

1. Foundations that receive or make cash payments equal to or exceeding the equivalent of 10,000 euros, whether the payment is a single transaction or several transactions that appear to be linked;
2. Legal entities that receive or make payments for goods in cash equal to or exceeding the equivalent of 10,000 euros, whether the payment is a single transaction or several transactions that appear to be linked;
3. Entrepreneurs who receive or make payments for goods in cash equal to or exceeding the equivalent of 10,000 euros, whether the payment is a single transaction or several transactions that appear to be linked.

The entities listed above are required to have appropriate procedures for reporting violations in their organizations, especially regarding financial or legal irregularities. The Anti-Money Laundering Act further strengthens the obligation to report violations related to financial crimes.

The catalog in the Act is much broader. If you know that you are subject to AML-related obligations, refer to the Anti-Money Laundering Act and ensure that you are not required to implement whistleblower protection procedures in your case.

4. Financial Institutions

Banks, insurance companies, and credit institutions are particularly obligated to comply with whistleblower protection regulations. The Anti-Money Laundering Act additionally imposes the obligation to report suspicions of financial crimes and protect individuals who report these violations.

Obligations Arising from the Whistleblower Protection Act

All entities subject to the Act must fulfill several obligations:

1. Implementation of reporting channels – legal entities must implement secure and confidential channels for reporting irregularities.
2. Designation of a person responsible for reports – persons responsible for receiving and considering reports must be appointed.
3. Protection against retaliation – whistleblowers must be protected against retaliation by the employer or entity with which there is a legal relationship for the provision of work, services, or legal functions in or on behalf of the legal entity;
4. Registration and reporting of reports – according to Article 17 of the Act, entities must maintain records of reports and report cases of violations.

Summary

The Whistleblower Protection Act of June 14, 2024, together with the Anti-Money Laundering Act, imposes obligations on businesses, public institutions, and professionals in so-called liberal professions or regulated professions.

If you are wondering whether you should implement procedures in your company, please contact us.

In our previous article on whistleblower protection, you will find answers to basic questions. You can find the link to the article here.

Contact

If you need legal assistance, contact our office at the phone number: +48 690 009 732

Write us an email: info@walawski.com

You can also write to us on Facebook: Our Facebook profile