Could you be landed with a crippling bill for telling the truth?

It’s hard to believe it could happen in a free country but there’s a serious risk that it could happen here.

A new law which was passed by parliament in 2013, but hasn’t yet been brought into force, threatens in effect to fine newspapers who expose wrongdoing. If it is introduced, it could end your right to know what’s being done in your name, and with your money.

It could stop the media running reports about misuse of public funds, incompetence among authorities, miscarriages of justice or criminal activity.

It is Section 40 of The Crimes and Courts Act.

It’s a small and obscure section of the act, but its effects could be huge and far from obscure.

It is a longstanding tradition in English law that if someone were to sue a newspaper for libel or invasion of privacy, then the losing side would have to pay the cost of the lawyers on both sides.

But under Section 40, if someone sues a newspaper for defamation or invasion of privacy – and even if a court ruled that the newspaper was telling the truth or that the intrusion was in the public interest – then the paper would still have to pay both sets of legal costs.

For many papers, especially local ones, those costs could be disastrous.

The only way a newspaper can avoid this threat is if it signs up to an official Government regulator, a body called Impress. Papers are reluctant to sign up to Impress since it means effectively that the Government gains a modicum of control of the media.

There are lots of examples of cases where newspapers have exposed wrongdoing, have been sued by the wrongdoer and have won.

In 1994 The Guardian exposed how former Conservative MP Neil Hamilton had taken cash from Harrods boss Mohammed Al-Fayed in return for asking parliamentary questions. Hamilton tried to sue The Guardian – but it was proved that the paper was telling the truth.

In 1997 another former Tory MP, Jonathan Aitken, also sued The Guardian for libel. It alleged that his £1,000 hotel bill for staying at the Paris Ritz had been paid by aides of the Saudi royal family, breaking the rules on Government ministers accepting gifts.

His denied this and sued for libel. And his case collapsed when the allegation was proved true.

A famous case from 1978 was a report in the Daily Mail about the practices of the Unification Church, better known as the Moonies.

The paper accused it of brainwashing and breaking up families, was sued by the church and won.

If Section 40 had been in force, then the papers in these cases would have had to pay the legal bills of Hamilton, Aitken or the Moonies, as well as their own bills, even though their claims were true.

Those costs could well have made them stop short of running the stories, and the wrongdoing would have gone unnoticed.

And it is not just an issue for the national media, as Bob Satchwell, executive director of the Society of Editors, points out.

“There are countless reports in local and regional newspapers about the misuse of public funds and inefficiencies in local councils, hospitals, the police and other public authorities, as well as private sector organisations such as buses and trains,” he says.

The Crimes and Courts Act was brought in after the Leveson Inquiry into the phone hacking practices of some parts of the media and Mr Satchwell says: “The sanctions were designed to curb the excesses of some national newspapers.

“But the unintended consequence is that all newspapers and magazines will be affected and some may be put out of business.

“They could face the crippling costs of legal actions even if they win cases in courts by proving they had printed the truth.”

The vast majority of newspaper and magazines, including the News & Star and its sister titles in CN Group, belong to the Independent Press Standards Organisation, or IPSO.

It is an independent body, financed by the newspapers and not the taxpayer, and has a code of conduct all member publications have to abide by.

David Helliwell, editorial director of CN Group, says any move to implement Section 40 would be a perverse move, against a basic principle of justice.

He explains: “If newspapers make errors in what they do, they should admit their mistakes.

“If we don’t, the regulator IPSO has powers to make us run corrections, apologise and even impose fines.

“If we libel or defame an individual we could be taken to court and face potentially huge punishments.

“All of those are accepted as fair and proper checks to ensure that journalists behave responsibly.

But he adds: “What would be completely unfair is if we published a story that correctly made allegations of wrongdoing against an individual, that person took us to court and lost and we still ended up paying all the associated court costs.

“Not only is it unfair, those costs could be potentially ruinous to local newspaper publishers.

“Introducing Section 40 is also a danger to democracy. Any dodgy businessman or official wanting to hush up an investigation into his affairs knows that he has nothing to lose by taking a newspaper to court.

“If newspapers stop these investigations because they can’t take the risk, then who will provide that service for society? It won’t be Facebook or Twitter.”

Nor will it be Impress, adds Mr Satchwell. “Impress is an ‘approved’ regulator, under a Royal Charter imposed on the press,” he warns. “It is the first step towards political control of the press.

“Parliament could easily translate the Royal Charter into full state regulation of the press.”

This is why Index on Censorship feels it can’t support Impress either.

Index on Censorship campaigns for freedom of expression and produces a quarterly magazine. Its chief executive Jodie Ginsberg says: “We won’t sign up to a regulator that has been set up by a state-created body.”

And she adds: “We think Section 40 jeopardises press freedom. We publish writers and artists who would face censorship elsewhere.

“We are a very small organisation, and if we were in a legal dispute and had to pay the legal costs of both sides – even if what we printed was true and in the public interest – we could end up out of business very quickly.”

Can anything be done to stop Section 40? The Department for Culture, Media and Sport is running a consultation on the plans to bring the section into force.

Those who disagree with it have until 5pm today (January 10) to make their views known. Mr Satchwell is hopeful.

“They will take notice of the public who realise they may be prevented from finding out about corruption and other misuse of taxpayers’ money.

"They need to hear from people who are concerned about their right to know and are worried about the future of their favourite local papers.”

Anyone who wants to comment can go to and complete the form or email .