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Newspaper publishers express concern that Leveson press regulation deal may open claims floodgates

By Gordon Young, Editor

January 11, 2013 | 5 min read

A newspaper industry meeting has heard that the proposed new press regulatory body and arbitration service could lead to a ‘landslide of complaints’ which will have a disproportionate impact on regional, weekly, magazine and smaller publishers generally.

As a result some publishers argued at the meeting - which was organised by Lord Hunt of Wirral, who is coordinating the industry’s response to Leveson - that the new regulatory framework may not offer any economic benefits that will encourage them to sign up.

The government is maintaining pressure on the industry to either set up a new regulatory body that will implement most of the Leveson recommendations, or face statutory control. Publishers are scrambling to have detailed proposals in place by the end of this month, before Labour and the Liberal Democrats, who favour statute, force a parliamentary vote on the issue.

If the industry can agree the detail of a new body, it could be up and running by the middle of this year. And although consensus has been reached on the general way forward the workings of the proposed new arbitration service could be a sticking point.

A central Leveson recommendation was the need for efficient, fast and – perhaps – free access to justice. A new arbitration arm is proposed which may deal with matters such as libel, harassment and privacy which otherwise would have gone through the courts. This new body could rule that publications pay compensation.

Such an arrangement may suit national newspapers, as it could cut the cost they are currently paying to defend expensive court actions. But, on the other hand, it is likely to encourage more people to seek compensation – particularly because it will now be cost effective to launch claims for very modest amounts - which will have an impact on smaller publishers.

One newspaper owner told the meeting: “Every time somebody trips over a paving slab in my area the council pays them £250 to avoid getting involved in some long drawn out process. I am concerned the same thing could happen to us.”

Another added: “Our teams of journalists are already operating at full stretch. I am concerned that our editors might be overwhelmed by claims through the arbitration system.”

Meanwhile a large regional publisher told The Drum outside the meeting: “This could be the point where the whole thing unravels. I do not think I will be able to get my directors to sign up to this. They may take the position that as we are rarely referred to the PCC, we might simply be better off outside the system. Our titles are trusted by the readers. We are really being asked to pay for the sins of the few.”

The issue focuses attention on what will happen to publishers who do not sign up to the new PCC. Government say that they will move to ensure that non-compliant publishers will be hit with costs and exemplary damages if a case against them ever went to court. In fact, even if they successfully defended such an action, they may still be forced to pay the claimant's costs.

However, the industry meeting was told it was the view of media lawyers that such a position would be challenged through the European Courts – as the same law applying to different groups with varying degrees of severity is contrary to basic principles of justice.

It was just one of several fundamental questions raised about the government position. The other key concern was that despite initially saying it did not want to regulate the press via statute, the government has announced plans that any new body should be monitored by Royal Charter, which would require statute.

One industry association told members in a briefing: “A Royal Charter is a worse scenario than a press law. It can be changed by a small group of Government ministers and defines who needs to be in the new regulatory system.”

However, the meeting was told that the industry was to propose an alternative structure where the new body could be monitored by a charitable trust.

The meeting was also told that the complexities of such a new system do not come cheap. At the moment the current Press Complaints Commission costs on average around £2.1m per year. It is anticipate the new body will cost around £1m extra per year. Again some organisations, such as magazine publishers – who only account for 4.4% of PCC complaints, despite contributing 6.5% of the costs – will baulk at contributing any more money.

Said a magazine industry representative: “We do not want to overpay for a system we do not heavily use.”


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