The “vital public interest” in protecting an anonymous source for British journalists was finally upheld – by European judges eight years after UK courts unlawfully ordered disclosure.

The facts of Financial Times Ltd and Others v UK, decided by the European Court of Human Rights earlier this month, provide another example of British judges earnestly grappling with the concept of journalistic freedoms yet getting it so wrong that their decision breached the media’s right to freedom of expression under Article 10 of the European Convention on Human Rights.

In 2001, Goldman Sachs prepared a report regarding a possible takeover of South African Breweries plc by Belgian brewing company Interbrew, which formed the basis of a confidential presentation submitted to Interbrew’s mergers and acquisitions team.

The presentation was leaked via an unknown source to the Financial Times, The Times, Reuters, The Guardian and The Independent. The ensuing news coverage significantly affected the share price of Interbrew and SAB.

Interbrew did not seek an injunction prior to publication of the news reports.

The company subsequently claimed the leaked document contained fabrications maliciously inserted by the source. It was keen to identify the source in order to take legal action for breach of confidence and prevent further leaks.

Its security and risk consultants, Kroll, tried to trace the source, without success.

Interbrew then managed to persuade a High Court judge to order the news organisations to hand over the leaked documentation “together with the envelopes or packaging in which they were delivered”. This risked identifying the journalists’ source, indirectly.

On appeal, the Court of Appeal upheld the High Court’s disclosure order. Lord Justice Sedley, usually known for his sure-footed approach in media cases, said for him the critical factor was that the source’s purpose in leaking the information was “maleficent”. The House of Lords refused to hear a further appeal.

However, the media organisations refused to comply with the disclosure order, risking contempt proceedings. They appealed to the ECtHR, claiming a breach of Article 10 of the Convention which protects the right to receive and impart information without interference by public authority.

Importantly, Article 10 also says this right may be restricted insofar as is “necessary in a democratic society” for protecting the rights of others and preventing the disclosure of information received in confidence.

The ECtHR said a source’s maleficent purpose should never be a “decisive” factor justifying disclosure; it was merely one of various factors to be weighed in the balance.

It held that the High Court’s interference with the media’s freedom of expression had not been “necessary in a democracy society” as required by Article 10, even though the disclosure order satisfied a legitimate aim of protecting Interbrew’s private rights and preventing disclosure of confidential information.

The ECtHR reiterated that freedom of expression is one of the essential foundations of a democratic society.

It added that disclosure orders “have a detrimental impact not only on the source in question, whose identity may be revealed, but also on the newspaper against which the order is directed, whose reputation may be negatively affected in the eyes of future potential sources by the disclosure, and on the members of the public, who have an interest in receiving information imparted through anonymous sources and who are also potential sources themselves”.

It emphasised a chilling effect on free speech will arise wherever journalists are seen to assist in the identification of anonymous sources.

The case adds to previous guidance given by the ECtHR in 1996, in Goodwin v UK, in which another disclosure order by the High Court (again unsuccessfully appealed to the Court of Appeal and House of Lords) was held to have breached Article 10.

Goodwin, a trainee journalist on a magazine, received confidential financial information about a company from a source who wished to remain anonymous. He was ordered to hand over his notes and divulge the source’s identity.

He refused, and was fined £5,000 for contempt. The ECtHR again held that the High Court’s disclosure order breached Article 10.

Reporters and sources will welcome the additional guidance of the ECtHR in the Interbrew case, which re-emphasises the importance of freedom of expression in a democracy.

It is time our judges recognised the vital public interest in protecting sources and journalistic freedoms with the same clarity and perspective as their European counterparts in Strasbourg.