New law requiring companies to have an Ethical Channel

Today, the Official State Gazette (BOE) published the new Law regulating the protection of people who report regulatory infringements and the fight against corruption, the approval of which means the incorporation, at last, of the Directive (EU) 2019/1937 of the European Parliament and of the Council of 23 October 2019 into Spanish law.

After more than a year’s delay, the Spanish law that establishes the regulations that must govern the configuration of ethical channels (internal information system) in both the public and private sectors and the processing of communications has finally been approved. The law grants protection to those persons who, in a working or professional context, report breaches of EU law or criminal or administrative offences.

Thus, it is established that they must have an internal information system:

• All natural or legal persons with 50 or more employees.
• Certain legal entities operating in the financial sector, or with obligations regarding the prevention of money laundering or the financing of terrorism, transport security or environmental protection, regardless of the number of employees.
• All political parties, trade unions, business organisations and foundations created by them that receive public funds.
• All entities that make up the public sector.
• All constitutional bodies, bodies of constitutional relevance and autonomous institutions analogous to the above.

On this basis, the Law mainly establishes:

• The characteristics that the internal information system must have (such as, for example, the designation of a System Manager or the creation of a register-book) and how the communications received must be handled.
• The configuration of the external reporting channel of the Independent Whistleblower Protection Authority.
• The measures for the protection of whistleblowers.

Although the implementation of these internal information systems will be progressive according to the number of employees (in July for those companies from 250 employees and in December for those with 50 or more employees), there is no doubt that the approval of this Law represents a new step forward in terms of Compliance, with companies having to adapt to this regulation and continue to establish measures for prevention, detection and reaction to the risks that may affect the organisation.

In particular, it is important to adopt internal whistleblowing mechanisms to comply with all the obligations and guarantees imposed by the new Law and to review the protocols and procedures for action. Otherwise, the Law provides for penalties of up to one million euros or a ban on contracting with the public sector.

For further information, please do not hesitate to contact the Compliance Department of Molins Defensa Penal: compliance@molins.eu