Britain's reputation for "libel tourism" is driving American and foreign publishers to consider abandoning the sale of newspaper and magazines in Britain and may lead to them blocking access to websites, MPs have been warned.

Publishers, human rights groups and campaigners have expressed "substantial and increasing concern" because comments that would be protected under the freedom of speech in the US constitution are actionable in London courts once published here, no matter how small the readership.

A memorandum submitted to a Commons select committee, ahead of a meeting with US publishers, states: "Leading US newspapers are actively considering abandoning the supply of the 200-odd copies they make available for sale in London – mainly to Americans who want full details of their local news and sport. They do not make profits out of these minimal and casual sales and they can no longer risk losing millions of dollars in a libel action which they would never face under US law. Does the UK really want to be seen as the only country in Europe – indeed in the world – where important US papers cannot be obtained in print form?"

The submission, on behalf of a number of US media outlets, including the Los Angeles Times, the New York Times and MacMillan (US), as well as Human Rights Watch, Global Witness US and Greenpeace International, added: "The consequences of making media organisations liable for putting articles – perfectly lawful by the law of their own domicile – on websites which are occasionally accessed in England should be obvious. The cost of fighting libel actions may lead internet publishers to build 'fire walls' against access from the UK, in order to avoid such actions."