Owners of Sun, Telegraph and Daily Mail say they may set up own watchdog if government opts for statutory underpinning

Three of the country's biggest newspaper groups, including the owners of the Daily Mail and the Sun, are threatening to boycott the government and set up their own regulatory body if the Conservatives yield to Labour demands for the statutory underpinning of a new press watchdog.

As parliament prepared for a knife-edge vote on press reforms on Monday, the culture secretary, Maria Miller, declared hopes of reaching a deal which would avoid a humiliating Tory defeat. But the publishers have warned that it will be a hollow victory if the political compromise is a new law.

Sources say "active discussions" between Daily Mail owner Associated Newspapers, the Telegraph Media Group and News International have been held in the past week about launching their own successor to the Press Complaints Commission amid warnings from some industry figures that a Leveson law, as proposed in Lord Justice Leveson's report on the press, would take the country back 300 years to a time when newspapers were licensed.

"We wouldn't join the regulator. It would challenge the government to go for full state licensing," said a source. "This is definitely under active consideration: to stand up against the politicians and for the media and say 'we'll go it alone and what are you going to do about it?' They will just end up fighting for years and newspapers might rediscover a common purpose around press freedom and become a beacon of liberty. This is definitely a fallback position."

The Guardian, the Financial Times and the Independent, which broke ranks with other newspaper groups earlier this month in an attempt to end the deadlock over press regulation, are not believed to be party to the discussions about a boycott.

The prospect of a breakaway regulator will infuriate the pressure group Hacked Off, which has been fighting a determined campaign for a Leveson law on behalf of victims of press intrusion.

The author JK Rowling pleaded on Sunday with Labour and the Liberal Democrats to vote for statutory underpinning: "I believed David Cameron when he said that he would implement Leveson's recommendations 'unless they were bonkers'. I did not see how he could back away, with honour, from words so bold and unequivocal. Well, he has backed away, and I am one among many who feel they have been hung out to dry.

"Monday's vote will make history one way or another; I am merely one among many turning their eyes towards Ed Miliband and Nick Clegg and hoping that they have the courage to do what Cameron promised, but which he failed to deliver."

There is nothing in last November's Leveson report to stop newspapers setting up their own system. He recommended "an independent self-regulatory body". However, this was coupled with the threat of punitive or exemplary damages for breaches of privacy or defamation to be imposed on any publisher who did not opt in to be subject to the regulator's rules. They would also have to foot claimants' legal costs even where a newspaper was found not guilty of committing an offence.

But the three dissenting groups, which have deep pockets and determined proprietors, are prepared to do battle, reflecting the strength of their opposition to statutory underpinning and to the influence of Hacked Off.

The Labour party has been accused of cynically supporting Hacked Off's campaign to force through a statutory basis for press regulation by hijacking government legislation including the defamation bill and the enterprise and regulatory reform bill.

Harriet Harman, the party's deputy leader, has said that Labour is working "very closely" with Hacked Off but is not "the political wing of Hugh Grant".

Newspapers involved in the talks know they are playing hardball on the eve of key vote, but it is not the first time they have warned that any threat of a Leveson law would entangle the government in messy legal battles for years.

Lord Black, the Tory peer and executive director of the Telegraph Media Group, has been a key player behind the scenes. During the Leveson inquiry, he warned that the rulings of a new press adjudicator would be constantly challenged in law if it was underpinned by statute.

Much may depend on what constitutes a "statutory underpinning" and the spin put on any deal by the parties, who have been locked a war of words over Leveson for three months.

The prime minister has said a press law would be "crossing the Rubicon" but it is understood that a "dab of statute" which would underpin a royal charter and ban the privy council from amending any charter would be acceptable to Associated, News International and the Telegraph.

John Whittingdale, the chairman of the culture, media and sport select committee, said he was opposed to any legislation but a "dab of statute" could be a price worth paying for the "greater prize" of a robust regulator.

guardian.co.uk © Guardian News and Media 2013


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