On 16 April the House of Commons voted on amendments proposed by the House of Lords to the Defamation Bill. In doing so, MPs rejected the Lords' proposal that companies should only be able to launch libel claims if they could show that they had suffered, or were likely to suffer, 'substantial financial loss' as a result of an alleged libel.
The House of Lords' proposed amendment to the Defamation Bill just doesn't reflect the real world.
Business as usual
With the complexity of the modern market place, it is next to impossible for a business to provide clear and direct evidence of substantial financial damage or loss of custom resulting from a libel. The impact on custom or reputation of a negative article is often only truly felt some time after the story has hit the headlines. By contrast, the beleaguered business will want to complain and obtain a correction to mitigate the damage immediately. Where evidence of substantial financial loss may not be immediately forthcoming or difficult to prove, businesses would lose the opportunity of mending their damaged reputations.
Add to that the practical difficulty of gathering evidence at all, not least with customers or suppliers reluctant to act as witnesses to confirm that they have taken their business elsewhere because of a negative reference in the press, and it is clear that this amendment cannot provide a real world solution.
When the economic climate for business in the UK is already far from comfortable, the result of this amendment would be another unwelcome blow. Do we really want to sacrifice the good names of our remaining businesses by removing a reasonable remedy, and in so doing hand the media yet another excuse for even lower standards of journalism?
Charity starts at home
As drafted, the Lords' amendment would impact on any organisation incorporated as a company, including charities and not for profit organisations who rely on their reputation for donations. This may simply be a result of poor drafting, nevertheless any amendment jeopardising the ability of such organisations to protect their reputations is entirely inappropriate.
Show me the evidence
The rhetoric of big boy bullying businesses, chilling the free speech of the media, is one thing. But where is the evidence that this actually happens? It's an easy vote winner to opine that our so-called draconian libel laws prevent proper criticism of companies, but this does not represent the reality. One quick glance at any British newspaper or on the internet is proof of that. In practice, a threat of defamation proceedings is a last resort, which the media knows only too well. It is unsurprising that, in self-service, the media fail to inform the public that this is the case.
The Commons acted sensibly in rejecting the Lords' amendment. Nonetheless, we can expect to see the Lords stir it up again when the Bill goes back before them for debate.Suggest a correction