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Editors around the world have opposed the draft Royal Charter and the role of the state in the regulator.
Mr Hollands warned that newspapers which have rejected the Royal Charter will likely form their own group to fill the void which will be left by the Press Complains Commission.
the prospect of heavy fiscal penalties, a maximum of 1 per cent of turnover or up to 1 million, to fund further investigations. Another problem is that under the charter any changes to the regulator rest almost exclusively with the government.
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The draft was released after the newspaper industry had its own proposed Royal Charter rejected by the Privy Council late last week.
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Newspaper Works chief executive officer Mark Hollands said he was troubled by the developments in Britain.
"After more than 300 years of society with a free press, the notion that British Parliament should now interfere with freedom of expression is deeply concerning," Mr Hollands said.
"It sends the wrong signals about a free press and democracy to other nation's whose embrace of democratic principles is less established."
string of negative reactions to the draft Royal Charter, as pitched by Parliament and released last week, was London Mayor Boris Johnson, who warned the government was challenging the foundations of press freedom in his column in The Daily Telegraph.
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The recognition panel would be in charge of appointing the regulator in which serving editors are excluded, but former editors, senior and academic journalists are included.
The proposed draft Royal Charter on press regulation in the United Kingdom has been denounced around the world, with some editors and politicians urging a boycott of the proposed charter on the basis of the role of government in its establishment and ongoing hand in the role of the regulator.
Charter to disaster
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