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The PRP Board’s indicative view on some elements of the Royal Charter

The following section outlines the Board’s indicative view on interpretation and meaning of some terms and elements of the Royal Charter.

A key aim of the Charter is to encourage and facilitate independent self-regulation. The PRP’s role is to apply the criteria in the Charter to applications for recognition and in doing so we will not adopt an overly restrictive approach to interpretation. We recognise that there might be more than one way of meeting each criterion, although each one of them must be satisfied in order for an applicant regulator to be recognised.

Eligibility to be considered for recognition

The PRP does not consider that the Charter’s definition of a regulator in Schedule 4 precludes a body from being eligible for consideration for recognition on the basis of the number and size of its members. A regulator being formed ‘by or on behalf of’ relevant publishers could include a situation where the regulator is formed on behalf of any publishers that might later choose to join.

Membership of a regulator

Given that the costs protections afforded by Section 40 of the Crime and Courts Act only arise if the publisher is a member of an approved regulator, publishers may choose to wait for a regulator to be approved before joining. The PRP does not interpret the Charter criteria as requiring the regulator to have current members in order to be eligible for consideration for recognition. However, an applicant regulator will need to show that they have the relevant procedures in place and that they are ready and able to operate those procedures.

Requirements of the regulator’s funding arrangements (Criterion 6)

In relation to criterion 6, we do not interpret the provision for funding for the system ‘being settled in agreement between the industry and the Board’ as requiring positive agreement to the funding arrangements with the whole of (or any particular minimum threshold of) the news publishing industry. This is because:

  1. The Charter envisages that there can be more than one regulator,
  2. Such a requirement could allow publishers an effective veto over the recognition of a regulator when they have no wish to become a member of that (or any recognised) regulator; and
  3. Given the sheer scale and diversity of ‘relevant publishers’ it would be impracticable to identify or contract all the relevant publishers that could or might be affected.

However, we bear in mind that the regulator has to ‘take into account the … commercial pressures on the industry’ and is required by criterion 23 to ensure that membership is open to all publishers on fair, reasonable and non-discriminatory terms….’. In those circumstances we consider that criterion 6 does, as a minimum, require some form of consultation that the wider industry could respond to if it wished.

We also consider that criterion 6 requires the regulator to provide a rationale for the decisions taken following the consultation including for example, how the regulator will ensure that certain types or sizes of publishers are not precluded from joining at a later stage (and therefore excluded from cost protection) because the fees do not sufficiently reflect the commercial pressures on the industry.

Given that criterion 6 refers to ‘funding for the system’ being agreed and not just the ‘regulatory fees’, we also consider that consultation should be on the whole of the funding arrangements, including any proposals to take funding from third parties.

There is nothing in the criteria or the Charter which precludes funding for the regulator being provided via or from a third party and such funding does not preclude an application or mean that a regulator is automatically not ‘independent’. It would be possible for third party funding to compromise the independence of a regulator, but whether it does so will be a question of fact and will depend on the safeguards that were put in place to protect independence, such as the terms of the agreement between the funder and the regulator and the regulator’s governance arrangements.

Constitution of the Code Committee (Criterion 7)

We consider criterion 7 as permitting serving editors to be part of the Code Committee and, if they are, to play an important (but not decisive) role in such a committee. However, we do not interpret the criterion as requiring such participation in light of the words ‘may comprise both independent members of the board and serving editors’ in the first sentence. If the criterion had intended a minimum requirement for serving editors this would have been stated more clearly, and we bear in mind our general approach of not implying additional restrictions into the criteria.

Use of the Editors’ Code (Criterion 8)

The Board has considered the interaction between the wording of the preamble to the Charter which states that ‘the independent regulatory body which is intended to be the successor to the Press Complaints Commission should put forward the Editors’ Code of Practice as its initial code of standards’ and criterion 8 which requires the PRP to assess the regulator’s code. We bear in mind that the criteria are legally operative whereas the preamble simply explains the Charter’s background (providing, at most, an aid to interpretation). Whilst there is nothing in the Charter to prevent a regulator from putting forward the text of the current Editors’ Code as its own code, we would still need to assess that submitted code against criterion 8 (even the preamble only talks of ‘putting forward’).

We do not consider it part of the PRP’s role to determine any dispute over ownership of the Editors’ Code (or any other code which an applicant submits) provided that that the criteria are met in relation to the standards code which an applicant regulator has properly adopted.