LONDON, England – Britain has long been a balmy destination site for libel tourism — sought out by litigants ranging from a Rwandan genocide suspect to a Saudi businessman to multinational corporations like McDonald’s and General Electric.

All that could change, however, under new libel reforms proposed yesterday.

Britain has been embarrassed for years about its popularity as a libel tourism destination. American celebrities started flocking here 20 years ago to sue fellow Americans — led by none other than California’s current governor, Arnold Schwarzenegger.

The practice has been used extensively ever since by other foreign plaintiffs, with the genocide suspect suing a human rights group and corporations targeting private citizens in costly legal battles.

Critics say Britain’s current libel law stifles free expression and hampers investigative journalism as well as research into public interest issues such as corruption or health risks.

“Our current libel laws need to achieve a fair balance between allowing people to protect their reputations from defamatory allegations, and ensuring that freedom of expression and the public’s right to know on matters of public interest are not unnecessarily impeded,” said Justice Secretary Jack Straw. “At the moment, we believe that the balance is tilted.”

Three main changes are being considered: creating statutory public interest defences, prohibiting claimants from suing multiple publications over the same material and establishing whether there is just cause to allow foreign claimants to sue in English courts.

A famous libel case was that of McDonald’s, which sued two environmentalists for making damaging allegations about its food, labour practices, advertising and links to environmental degradation. McDonald’s lost key points in the 1997 ruling but the defendants, a former postman and gardener, were ordered to pay more than £60,000 in damages.

Carter-Ruck, one of Britain’s leading libel law firms, yesterday welcomed an overall legal review but rejected claims that the country’s existing libel law stifles free expression. It also supported the right of foreigners to sue in English courts.

“In certain foreign countries, they publish propaganda to undermine their political opponents,” said Nigel Tait from Carter-Ruck, which participated in the committee that led to the Government’s proposals. “That propaganda is beamed into this country with hard copies of newspapers, or on television or the Internet, and political dissidents or businessmen should have the ability to protect their reputations.”

Several US states have introduced laws to protect American citizens from the enforcement of legal settlements in foreign jurisdictions such as Britain. A similar federal law is currently before the US Congress.

Saudi businessman Khalid Bin Mahfouz successfully sued American author Rachel Ehrenfeld over a US-published book about the financing of terrorism that had sold only 23 copies in Britain.

The British Government wants to tighten the rules where the court’s permission is required to serve defamation cases outside England and Wales. This could curb the number of foreign claimants flocking to English courts.

Another proposal could extend the public interest defence in libel cases to people other than journalists. Many journalists already depend on that defence when publishing information they believe could be valuable to the public interest.

“One of the key things for us is having a public interest defence,” said Jo Glanville with the London-based Index on Censorship. “Up until now, there has been a defence that emerged through common law that gave protection mostly to journalists. It’s been considered a less certain or robust defence for non-governmental organisations or freelance writers who have investigated corruption or other issues.”

Human Rights Watch was sued in London by a Rwandan genocide suspect whose mention in one of the group’s reports was blamed for delaying his residency application for the UK. The rights group was mired in costly and lengthy litigation and eventually agreed to clarify some of the evidence in its report. The substance of the report remained unchanged.

More recently, however, General Electric — a British subsidiary of General Electric — sued Dutch radiologist Henrik Thomsen in a London court after he raised concerns over the potentially fatal risks of one of the company’s drugs. He made the claims at a scientific conference at Oxford and is one of a handful of academics or scientists currently being sued in London for libel.

“It’s dangerous for the patient if we can’t frankly exchange views,” he said of the lawsuit filed last year.

A further Government proposal would replace the current multiple publication rule with a single publication rule — people will not be allowed to bring a case against every publication or download of a story repeating the same claims. It would also establish a timeframe when claims could be made after the first publication.

This proposal would be important to defendants who are sued when the material appears in multiple publications.

Schwarzenegger was one of the first so-called libel tourists. In 1990 he sued the American author Wendy Leigh for material in an unauthorised biography that was published in the UK, among other countries, Schwarzenegger accepted undisclosed libel damages from Leigh, who provided material for the News of the World tabloid claiming the actor held Nazi and anti-Semitic views.

Leigh’s book, however, still went to print.

A libel reform bill could be heard by the next Parliament. Britain holds national elections this spring.