The House of Lords are pushing for the implementation of Section 40 of the Crime and Courts Act
The change proposed to legislation currently going through the House of Lords would have effectively implemented measures contained within Section 40 of the Crime and Courts Act 2013 for digital publishers, as opposed to newspapers.
It would have meant online news sites not signed up to an officially recognised regulator footing the legal costs of both sides in libel and privacy actions brought against them.
The amendment to the Digital Economy Bill during its committee stage was the latest in a series of moves by campaigners to force the Government to act on press regulation.
The costs provision, recommended by the Leveson Inquiry, has yet to be implemented – much to the frustration of victims of press abuse.
My hope is for a free and responsible press
A consultation by the Government on implementing Section 40 and whether to proceed with part two of the Leveson Inquiry is now the subject of a legal challenge.
Impress, part-funded by Max Mosley, the former motor racing boss who was a victim of a newspaper sting, has been recognised as the official regulator.
But most newspapers have signed up to the Independent Press Standards Organisation, the press-funded body which did not seek official recognition.
The provisions for media outlets to pay both sides' legal costs were laid out in the Leveson Inquiry
Proposing the amendment, independent crossbencher Baroness Hollins, whose family was the victim of press intrusion, said they had gone through the "traumatic process" of giving evidence to Lord Justice Leveson because of an expectation his recommendations would be acted upon.
She was supported by Labour former deputy prime minister and phone hacking victim Lord Prescott.
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He said: "It's not to create a new piece of legislation, it is in fact to implement what both Houses of Parliament agreed is the law of the land."
Max Mosley is the main financial backer of Impress, the state-recognised press regulator
Opposition spokesman Baroness Jones of Whitchurch said Labour supported the amendment.
Responding for the Government, Lord Keen of Elie said: "There is obviously a great strength of feeling about this matter."
He realised some peers "are frustrated by what they see as a lack of progress by government on Section 40".
However, he also highlighted the opposition against the measure because of concerns over its impact on the freedom of the press.
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1952: Jovial Queen Elizabeth having left Buckingham Palace in the Irish State coach for Westminster for the State Opening of Parliament
And he argued the "press self-regulatory landscape" had changed over the four years since the Leveson Inquiry reported.
He said: "It is right the Government takes stock, looks at the changes which have already taken place and seeks the views of all interested parties on the most effective way to ensure the inexcusable practices … can never happen again."
Lord Keen said more than 140,000 responses had been received to the consultation, but no decision would be taken until the legal action had been resolved.
Arguing against the amendment, he said: "Bringing in a law that effectively mirrors Section 40 but for relevant digital publications only would create an incoherent regime, applying different rules depending on the mechanism by which an article has been published."
House of Lords peers are campaigning for a 'free and responsible' press
But he said the continued actions of peers in raising the issue had "not gone unnoticed in government".
Lady Hollins said: "My hope is for a free and responsible press, but what is most disappointing for the public is over the last four years of inertia and of the press failure to establish a proper regulator, countless more individuals have been affected by press abuse."
She said she was "disappointed" at the minister's response and while withdrawing her amendment, said she planned to return to it again at a later stage of the Bill.