May 12, 2017

This article was first published in Entertainment Law Review, 2017,  issue 3 and is reproduced in agreement with the Publishers.

Press regulator, IMPRESS, has been granted recognition by the Press Recognition Panel (PRP), the independent body created by Royal Charter to oversee press regulation. Following what the PRP press release called “a robust assessment process”, the PRP Board decided that IMPRESS met all the recognition in Sch.3 to the Royal Charter, which means that, amongst other things, IMPRESS was in its view “independent of the print and online publishers it regulates, and is appropriately funded”. There has been a strong and polarised reaction to the decision, showing that there is still a huge divide between the majority of the national and regional newspapers and magazine publishers, which support self-regulation and groups representing press abuse victims, who support reglation underpinned by the state. Further adding to the discord, the Government announced a Consultation on the Crime and Courts Act

2013 s.40 (the costs penalties designed to “strongly encourage” regulation by a recognised regulator), which has been enacted by Parliament but not commenced, and on whether it is still in the public interest to continue with Pt 2 of the Leveson Inquiry, which covers wrongdoing in the press and the police.

Background

Following the Leveson Inquiry, Parliament reached a cross-party agreement on a new mechanism for press self-regulation, which was enshrined in a Royal Charter. This established a new independent body, the Press Recognition Panel, for approving press self-regulators to become a “recognised regulator” if they met specific criteria in areas such as independence, funding and appointments.

In 2014, in response to the Leveson Inquiry report, the majority of publishers (national and regional newspapers and magazines) pronounced the Independent Press Standards Organisation (IPSO) to be their new regulator, in place of the Press Complaints Commission. IPSO is financed by the Regulatory Funding Company, funded by IPSO’s members. The FT and the Guardian elected to self-regulate.

In December 2014, the Independent Monitor for the Press (IMPRESS) was launched with the announcement of its inaugural Board. IMPRESS was to be an alternative self-regulator to IPSO. Its major funder is the Independent Press Regulation Trust, a charity in turn funded by a trust fund set up by Max Mosley in the name of his late son, Alexander. Max Mosley has been one of the leading voices calling for tighter regulation of the press after he won a privacy case against the News of the World following a sex exposé. The IMPRESS Board began work in January 2015. IMPRESS currently has around 50 member publications, consisting mostly of small local newspapers and independent magazines. Unlike IPSO, IMPRESS decided to seek recognition as an independent press regulator under the Royal Charter.

The recognition process

The meeting of the PRP Board to consider IMPRESS’s application took place in public on 25 October 2016. The PRP is keen to state its commitment to openness and transparency, and therefore made a recording of the meeting available online and on 21 November 2016 published a report of Board’s decision along with the documentation considered by the Board when making its decision.

As part of the assessment process the PRP provided three opportunities for the public and third parties to review IMPRESS’s application and provide feedback to the PRP. The PRP says that “several people and organisations took up the opportunity”, and that it received further submissions in the lead up to the meeting. All relevant information was considered by the PRP Board when making its decision and will be published on the PRP’s website in due course, alongside the IMPRESS application, the PRP’s assessment report and the Board’s final decision.

Reaction

Hacked Off, the group that campaigns on behalf of press abuse victims, welcomed the decision and called on the Government to deliver promised free speech protections.

Hacked Off ’s Joint Executive Director Dr Evan Harris said:

“By passing the PRP’s audit, IMPRESS is the first regulator to have proven its independence and effectiveness under the Leveson system of independent assessment. The days of failed industry-controlled regulators like the PCC and its sham replacement IPSO are numbered. IPSO members’ desperate attempts to derail the Leveson process with further delays and aggressive threats of legal action against the PRP, have failed yet again today.

“This decision makes IMPRESS the only regulator which the public, readers and victims of press abuse can trust to regulate newspapers and safeguard freedom of the press, while offering redress when they get things wrong.”

Walter Merricks CBE, Chair of IMPRESS, said:

“The PRP decision is good news for the press and good news for the public. This is the next important step  in  building  a  new  era  of  trust  between journalists and the public and a significant moment in the history of press regulation in this country. For the first time news publishers, both large and small, have the choice to join an independent press regulator which is not controlled by major publishers …

We believe that independent press regulation meets a real public need. As a truly independent regulator, that is not part of the newspaper industry, we can put decent standards and accuracy at the heart of news publishing, dealing with complaints fairly and with impartiality.”

IPSO, on the other hand, gave a very short official statement, saying simply, “We have been regulating the overwhelming majority of the UK’s newspapers, magazines and news websites for the last two years and will continue to do so”.

However, a few days before the PRP’s decision, Sir Alan Moses, Chairman of IPSO, speaking at the Society of Editors’ conference, warned his audience of what was at stake in terms of the thorny subject of press regulation: “a vibrant local and regional press which bears the true mark of what makes it viable and precious … its independence”. Independence is what readers value most, Sir Alan said, and “it is they and all of us, who have most to lose and who will suffer without a press free from control, regionally and nationally”.

Sir Alan continued: “You should be very wary, very wary indeed of anything that looks like an attempt to corral you into submission: government, the powers that be, want to goad you, prod you into doing what they want”.

Sir Alan was, of course, also referring to the Crime and Courts Act 2013 s.40, which provides that a newspaper that is not a member of an approved regulator risks having to pay a claimant’s court and legal costs even if the newspaper wins the case. This has not yet commenced and, in fact, the Government has launched a consultation on it (see below). Sir Alan said that the:

“real and underlying danger of section 40 … lies not in the purpose which it proclaims … that your regulator should be recognised by a body paid for by the State … but a far more fundamental and underlying current: that it is intended to herd you, force you into something you do not want to do.”

In Sir Alan’s view, “the essence of successful press regulation … is that it is voluntary”.

The News Media Association’s response to the PRP decision was also negative. Lynne Anderson, NMA Deputy Chief Executive, said:

“We are disappointed by the PRP’s decision to recognise Impress, a regulator funded by Max Mosley and set up in order to trigger punitive costs sanctions against Britain’s press. However, we welcome reports that the Government has decided to pull back from implementing Section 40 of the

Crime and Courts Act, which would inhibit a free press and have a crippling effect on regional and local newspapers.

“Over 90 per cent of UK newspapers and magazines—over 1500 print and 1100 online titles—have voluntarily signed up to a system of self-regulation under IPSO which has been found to be both effective and independent of the industry. A   small   number   of   micro   businesses  and multi-author blogs have been persuaded to join Impress quite unnecessarily, given they are excluded from the definition of relevant publisher. Not a single significant national or regional newspaper or magazine has signed up to the state-sponsored system of regulation under the PRP.”

Government consultation

At the same time as all of this was going on, the Government announced a consultation on the Leveson Inquiry and its implementation in order to “make sure the UK has a free and vibrant press but one which is held fully accountable when things go wrong, as set out in the manifesto”.

A consultation is needed, the Government says, because since evidence of phone-hacking emerged in 2011, “there have been major changes to the way newspapers conduct and regulate themselves in the UK”, and because the relationship of the press with the public, police and politicians has changed. Further, according to the Government, the majority of the recommendations from the first part of the Leveson Inquiry have now been implemented.

The Government is seeking views on: (i) the implementation of s.40; and (ii) whether proceeding with Pt 2 of the Leveson Inquiry, which covers the relationship between the press and the police, is still appropriate, proportionate and in the public interest.

Crime and Courts Act s.40

Crime and Courts Act s.40(3) says:

“If the defendant was not a member of an approved regulator at the time when the claim was commenced (but would have been able to be a member at that time and it would have been reasonable in the circumstances for the defendant to have been a member at that time), the court must award costs against the defendant unless satisfied that—

(a)        the issues raised by the claim could not have been resolved by using an arbitration scheme of the approved regulator (had the defendant been a member), or

(b)        it   is   just   and   equitable   in   all   the circumstances of the case to make a different award of costs or make no award of costs.”

On s.40, the consultation seeks views on the following options:

• keep s.40 under review

Given the changes that the press industry has gone through over the last four years, it has not been considered appropriate to commence s.40. One option is to conclude that the time is not right now, but to continue to keep commencement of s.40 actively under review;

• fully commence s.40

The Government could make a commencement order to bring s.40 into force in its entirety. Some argue this will maximise incentives to join a recognised self-regulator and that newspapers that choose not to join in these circumstances are voluntarily laying themselves open to additional legal costs. Others argue that the potential financial impact on publishers outside a recognised regulator if s.40 is commenced would be significant and could put publishers, particularly small, local newspapers, out of business. As such, the Government says that it is keen to understand the evidence around commencement for all those affected, including individual publishers and the industry as a whole;

• repeal s.40

This option would seek to repeal s.40 in the next appropriate legislative vehicle on the basis that the incentive is no longer required. There is a range of views on the likely effectiveness of s.40 in encouraging membership of a recognised self-regulator. Given Parliament has legislated to create s.40, if there is no intention to commence it, or it is viewed as no longer of practical benefit, it should be repealed from the statute book; or

• partially commence s.40

A further option now that IMPRESS has been recognised by the PRP is for the Government      to      commence     the sub-sections of s.40 that would give protections to members of a recognised self-regulator. This would mean publishers within a recognised self-regulator would be protected from the adverse costs arising from legal action brought by powerful claimants.  Those  outside  a  recognised self-regulator would not share those benefits. The elements of s.40 that apply to those outside a recognised regulator could either remain on the statute book and be kept under review, or repealed.

Part 2 of the Leveson Inquiry

As for Pt 2 of the Leveson Inquiry, which was designed to look at wrongdoing in the press and the police, the Government notes that the terms of reference for Pt 2 were drafted before Pt 1 had started. Since then, three police investigations—Operations Elveden, Tuleta and Weeting (including Operation Golding) —have investigated a wide range of offences at a total cost of more than £43 million. The Government is therefore considering whether undertaking Part 2 is still in the public interest.

The options the Government is consulting on are:

• continue with the Inquiry, either on the original terms of reference or amended terms of reference

Given that it appears that many elements of the terms of reference have already been covered by the criminal investigations and Pt 1 of the Inquiry, the Government is interested to hear views on whether continuing the Inquiry based on the 2011 terms of reference is still proportionate and in the public interest; and

• terminate the Inquiry

The police service in England and Wales has undergone significant reform since the Leveson Inquiry, particularly in its relationship with the media. Similarly, the press has undergone significant changes. The Government wants to understand whether the reformed institutional structures in both the police and the press mean holding Pt 2 of the Inquiry is no longer appropriate or in the public interest.

The consultation closes on 10 January 2017. Sir Brian Leveson has already indicated that he would not want to chair Pt 2 of the Inquiry if it proceeds.

Comment

Putting to one side the political issues, s.40 is horribly drafted, giving scope for considerable litigation on its interpretation. Currently, the rules on costs recovery (set out in the Civil Procedure Rules Pt 44) are that the court has discretion as to whether costs are payable by one party to another. If the court decides to make an order about costs the general rule is that the unsuccessful party will be ordered to pay the costs of the successful party but the court may make a different order. In reaching its decision, the court will, currently, have regard to all the circumstances and Pt 44 sets out the sort of conduct which will be taken into consideration, namely the party’s conduct before, as well as during, the proceedings and in particular the extent to which the Practice Direction on Pre-Action Conduct was followed or any relevant pre-action protocol; whether it was reasonable for the party to raise, pursue or contest a particular allegation or issue; the manner in which the party has pursued or defended its case or a particular allegation or issue; and whether a claimant who has succeeded in the claim, in whole or in part, exaggerated its claim.

The wording of s.40(3) says that, in the case of a publisher regulated by a non-approved regulator, the court “must” award costs against the defendant unless it is just and equitable in all the circumstances to make a different award. The section is clearly intended to displace the rules on costs recovery and the usual way in which a judge is to decide the just and equitable position but it does not explain how. Does “must” mean that the court must ignore the factors that the court would take into consideration?

On the face of it, s.40 means that a claimant can bring proceedings  against   a   publisher   regulated   by   a non-recognised regulator, make no attempt to settle the claim using ADR or using the conciliation services of the non-regulated regulator, commence proceedings on a claim that has no merits at all, plead it badly, run it to trial with no attempt to settle it, lose all interim applications on the way and lose at trial, yet have its costs paid.

There are other issues to resolve with s.40 too, such as whether conditional fee agreements that provide for success fees can be valid where there is no risk to a claimant that they will not recover their costs.

Even if s.40 is brought into force it seems unlikely that many publishers who have decided to self regulate or join IPSO would consider IMPRESS instead, so resolute are they not to be regulated under the Royal Charter. There is no easy solution and the divide between the two sides, between the stridently independent press and those keen to see heavier regulation such as campaign group Hacked Off, is not becoming any narrower.