Policy paper

Economic Crime and Corporate Transparency Act: strategic lawsuits against public participation (SLAPPs)

Updated 1 March 2024

1. Background

SLAPPs are legal actions typically brought by corporations or individuals with the intention of harassing, intimidating and financially or psychologically exhausting opponents via improper use of the legal system. SLAPPs are typically framed as defamation cases brought by wealthy individuals (including Russian oligarchs) or corporations to evade scrutiny in the public interest. They can occur across a broad spectrum of issues including data protection, privacy and environmental law. Actions are typically brought against investigative journalists, writers and publishers, and are designed to silence criticism.

SLAPPs characteristics include, but are not limited to, large numbers of aggressive pre-action letters, targeting a financially weak defendant and bringing claims simultaneously in multiple jurisdictions. At their heart SLAPPs fundamentally undermine freedom of speech and the rule of law.

SLAPPs are common around the world with claimants relying on many claims in different jurisdictions to cause as many problems for defendants as possible.

The United Kingdom has an international reputation for upholding the rule of law and is a global centre for court-based dispute resolution and international arbitration, this is in part due to the quality and independence of our world-renowned judiciary and legal practitioners. Litigants from across the globe choose the UK to resolve their dispute due to this. Our legal system, which attracts parties to the UK to resolve their legal disputes, makes a very significant contribution to the UK economy.

The government is committed to upholding transparency and the rule of law to ensure the UK legal system remains world-leading. Abuse of the system will not be tolerated. The Defamation Act 2013 introduced stricter requirements on cases being brought in the UK to curb ‘libel tourism’, making sure this is the right forum to proceed and hear claims.

SLAPPs are a rising problem and amount to abusive proceedings. We are legislating to protect defendants from this type of activity.

The government is committed to balancing individuals’ rights to protect their reputation with the right to free speech and access to justice.

2. Why is legislative action on SLAPPs needed?

The UK does not currently have any anti-SLAPP legislation. SLAPPs present a growing problem as claimants explore new ways to suppress legitimate reporting.

The Ministry of Justice’s SLAPPs Call for Evidence ran from March to May 2022 and provided an evidence base which informed the government’s legislative intentions. We received evidence about the severe psychological and financial impact these actions have on SLAPP victims.

There is no statutory definition of SLAPPs which creates legal uncertainty. Our new provisions in the Economic Crime and Corporate Transparency Bill will give SLAPP defendants, regulators and legal professionals clarity which will help in identifying and challenge these actions through the courts.

3. What do the government’s amendments seek to do?

The government is tabling amendments in the Economic Crime and Corporate Transparency Bill at Lord’s report stage to tackle SLAPPs that feature economic crimes. The overall intention of the provisions is to provide defendants with greater protection when faced with SLAPPs in this field.

Defendants will be able to use a new early dismissal mechanism where their case falls within the statutory definition of SLAPPs as determined by the court. Where a SLAPP case is allowed to proceed, a new costs protection regime will apply, meaning defendants will not face the risk of excessive cost burdens.

4. What action has the government taken to date on SLAPPs and media freedom?

The government is working proactively with international partners to address the challenge posed by SLAPPs. The UK is an elected member of the upcoming Council of Europe Working Group on SLAPPs which will produce a draft recommendation for Member States by December 2023. The UK is also working closely with the Organisation of Security and Cooperation in Europe’s Representative on Freedom of the Media team to highlight UK domestic efforts to combat legal threats.

The government is taking action to support freedom of expression and to safeguard the work of journalists holding the powerful to account. For example, forthcoming online safety legislation will enshrine in law protections for journalistic content and free debate. The Foreign Commonwealth and Development’s Office’s Media Freedom Coalition has 47 nations as signatories to its ‘Media Freedom Pledge’.

In addition, HM Treasury’s Office for Financial Sanctions Implementation (OFSI) is responsible for implementing the UK’s financial sanctions regulations. Their approach to the licensing of legal expenses to date reflects the fact that the right to legal representation is a fundamental one and it is therefore important that Designated Persons are still able to access legal representation. However, in this context, it is the government’s view that in most cases, the use of frozen funds for payment of legal professional fees for defamation cases is not an appropriate use of funds, and in many cases will be against the public interest. Whilst still reviewing each individual application on a case-by-case basis, OFSI will, in future, take a presumption that legal fees relating to defamation and similar cases will be rejected. The Russian and Belarussian Legal Services General Licence has also been amended so that it no longer authorises legal fees for defamation and similar cases.

5. Q&A

How many SLAPPs cases take place in this jurisdiction?

While precise figures are difficult to pin down, SLAPPs are on the increase – provisional data from the Coalition Against SLAPPs in Europe (CASE) estimate there were 14 in England and Wales in 2021, up from 2 in both 2020 and 2019 and 1 case in 2018.

For context, CASE report that over the last 10 years there were 570 cases in Europe. CASE have not released any data for 2022.

How many SLAPPs cases concern economic crime?

At least 70% of the cases referenced in a report about SLAPPs, published in April 2022 by the Foreign Policy Centre and ARTICLE 19, were connected to financial crime and corruption. ^{[footnote 1]}

Why is the government only tackling SLAPPs relating to economic crime?

The government is committed to urgent action on SLAPPs. The Economic Crime and Corporate Transparency Bill presents the earliest opportunity to pursue reforms that address a significant proportion of SLAPP activity featuring economic crime. The bill’s scope is restricted to economic crime-focused provisions.

The government is considering future legislative options to introduce comprehensive anti-SLAPP measures as soon as parliamentary time allows.

What is being done to prevent abuse of the legal system and how are lawyers being regulated?

Professional obligations require that when lawyers are advising on bringing disputes, their duties to their client do not override their public interest obligations and duties to the court.

Advising clients to use SLAPPs so as to bring cases without legitimate basis, sufficient merit, or proper intent is a misuse of the legal system and may be considered misconduct which warrants disciplinary proceedings.

The Solicitors Regulation Authority (SRA) published guidance on SLAPPs reminding solicitors and law firms of their duties and the serious consequences of breaches of these duties. The SRA are stepping up spot checks and investigations to monitor and enforce compliance.

The SRA issued a warning notice to its regulated professionals on 28 November 2022, particularly addressing correspondence in these actions.

How will you control the costs of SLAPPs?

SLAPPs are used by the very wealthy to target journalists and campaigners who often have limited assets, by threatening them with having to pay high legal costs. They use this fear of unaffordable costs to intimidate and oppress and silence those who would wish to investigate their affairs.

We will cap costs via secondary legislation. We will work with the Civil Procedure Rules Committee to introduce a costs protection scheme to stop costs from racking up and address the stark inequality of arms in SLAPPs cases.

How does the UK’s approach to SLAPPs compare to other jurisdictions?

Several foreign jurisdictions have taken action to curtail the use of SLAPPs, including Australia’s Capital Territory, three Canadian provinces, and more than 30 US states. These, however, are limited to specific territories / states, and are not national legislation.

While the European Union is considering an EU-wide Directive, no EU state has currently enacted anti-SLAPP legislation.

Footnotes

1. ‘London Calling’: The issue of legal intimidation and SLAPPs against media emanating from the United Kingdom, a report by Foreign Policy Centre and ARTICLE 19 published in April 2022. ↩