Section 40 consultation process ends – the ball is back in the Government's court

Nearly four years on and the Government is finally consulting on whether section 40 should come into effect. In short the provision means that a media organisation which defends a defamation or privacy case could be made to pay both its own and the claimant’s legal costs – even if it wins in court – unless it is a member of an 'approved press regulator'. The only approved press regulator to date is Impress (the Max Mosley funded body) which received recognition from the Press Recognition Panel in October 2016. On the other hand, most publishers, with the exception of a few notable titles (for example the Guardian and the FT which have not endorsed either body), have signed up to the Independent Press Standards Organisation (IPSO), the press-funded body which has not sought official recognition and has declared that it has no intention of doing so.
 
The consultation on section 40, which lasted 10 weeks and closed on 10 January 2017, received in excess of 140,000 responses.
 
Where next for the Government
 
Section 40 has sparked outrage from the media, who have warned that it will "end 300 years of press freedom" by forcing them either to sign-up to a state-backed press regulator or face a sea of baseless claims from claimants. The result, they claim, is the almost inevitable closure of titles and the restriction on free speech in this country. For smaller, local papers and high-risk public interest stories, section 40 may prevent publication altogether.
 
Meanwhile those who argue that section 40 should be implemented (led by the campaign group 'Hacked Off') claim that it will "provide the teeth for the Leveson regulation reforms" and offer protection for ordinary people from press abuse. Responding to the media’s criticism, they point to the specific wording of section 40(3) which provides the court with a discretion under which costs should not be awarded against the successful defendant it if would be “just and equitable in all the circumstances”. They say this provides an important limit on the section 40 litigation threat so that the full force of the section will only be realised in cases where the court is satisfied that the claimant had an arguable case.

In the circumstances the battle between the media and its most vociferous opponents has become increasingly embittered. Some, such as John Wittingdale MP (the former Secretary of State for Culture, Media and Sport) have advocated a position whereby section 40 would remain on the statute books but not be enforced (in effect so the Government can hold an executive ‘Sword of Damocles’ over the press to ensure future good behaviour). Instinctively this feels like an unsatisfactory compromise and will not placate either side. Indeed, whether Karen Bradley MP (the current Secretary of State) is of the same view as her predecessor remains to be seen. In any event there is no doubt that if section 40 is brought into force it will leave the press between a rock and a hard place, leaving them to decide whether to join Impress or accept the potentially harsh consequences of the legislation. What would undoubtedly follow would be a legal challenge through the courts. Watch this space.

If you require further information on anything covered in this briefing please contact Oliver Lock ([email protected]) or your usual contact at the firm on 020 3375 7000. Further information can also be found on the Brand & Reputation page on our website.

This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.

© Farrer & Co LLP, January 2017