President Obama yesterday signed into US law legislation aimed at protecting American authors, journalists and academics from Britain's libel laws.

The Securing the Protection of our Enduring and Established Constitutional Heritage Act, known as the SPEECH Act, makes libel judgments against US writers in foreign territories unenforceable if they are perceived to counter the First Amendment right to free speech.

The British-based Libel Reform Campaign has expressed concern that Britain's reputation is being damaged internationally due to what it calls "our restrictive, archaic and costly libel laws, which cost 140 times the European equivalent."

The SPEECH Act is inspired by the Libel Terrorism Protection Act passed by the New York State assembly in February 2008, after American academic Dr Rachel Ehrenfeld was sued in London by an Arab businessman Sheikh Khalid bin Mahfouz.

Only 23 copies of her book Funding Evil were sold in Britain compared to thousands distributed in the US. Mahfouz did not launch an action in the US courts because of First Amendment protection.

Jo Glanville, editor of Index on Censorship, said: "The US's response to our libel laws has already played a key role in advancing the campaign for reform in the UK.

"I'm hopeful that the government's draft bill will address the issue of libel tourism, which has a clear chilling effect on freedom of speech, and make it harder for claimants from outside the EU to bully publishers, NGOs, bloggers and investigative journalists into silence."

And Jonathan Heawood, the director of English PEN said: "It's hugely embarrassing that other countries are passing laws to protect their citizens from libel actions in our high court.

"English libel lawyers claim that libel tourism is not a problem, if this is the case why has President Obama just signed into law a measure to protect his citizens from our courts?"

Sources: Reporters' committee for freedom of the press/Libel Reform Campaign