A Liberal Democrat amendment in the House of Lords to the Competition Bill would have put a halt to the practice, which is aimed at putting rivals out of business.

But in the Commons, the committee considering the Bill removed the new clause.

Rupert Murdoch was criticised for price-cutting

Rupert Murdoch's News International has been strongly criticised for cutting the cost of the Times and the Sun to kill off competitor newspapers.

Trade and Industry Minister Ian McCartney told MPs there were already measures in the Bill to prevent predatory pricing by companies which unfairly use their dominant postion in the market.

Protecting the industry

He said that the new clause was unnecessary and could have had a "serious detrimental effect" on the newspaper industry.

"It is hopelessly unclear how the prohibition would operate in practice or what sort of editorial or commercial behaviour would be prohibited," he said.

Supporters of the amendment can still try to revive it when it returns to the floor of the House of Commons for its report stage, but given the government's majority, they are unlikely to be successful.