Former Formula 1 boss Max Mosley, who sued after a tabloid made allegations about his involvement in a "sick Nazi orgy", has called for the creation of a press tribunal with powers to fine a newspaper group up to 10% of its turnover.
The wealthy businessman told the Leveson Inquiry into journalistic ethics that the tribunal should be underpinned by statute and given power to deal with "privacy, defamation, media harassment and accuracy".
He told the inquiry that the tribunal would have authority over the printed press, press agencies and the internet and have powers to impose fines, award damages and order corrections.
Mr Mosley was the subject of a News of the World article alleging that he took part in a "sick Nazi orgy". He was awarded a record £60,000 in privacy damages at the High Court after taking legal action following the March 2008 story, which he denied.
Mr Mosley told the inquiry a number of "major problems" had to be solved.
"First, litigation for breach of privacy or defamation is beyond the means of all but the richest, be they newspapers or individuals. Justice is thus denied to most of the population," he said, in a written statement to the inquiry.
"Second, a section of the British press has for many years repeatedly gone well beyond the bounds of civilised behaviour, routinely breaking the law, ignoring rules devised by the newspaper industry itself and adopting a bullying and dishonest approach to litigation."
Mr Mosley said watchdog the Press Complaints Commission (PCC) had not been able to enforce rules.
"We need to resolve these problems without in any way restricting public interest and serious investigatory journalism - the freedom of the press," he added. "The proposed solution is to create an entirely new body, the Press Tribunal, to mediate and where necessary enforce the rules, while keeping the existing rule-making body, the PCC, albeit in modified form, as the Press Commission."
Mr Mosley gave evidence to the Leveson Inquiry in November, when he accused the Government of having been "completely in the thrall of" newspaper bosses. He has returned as inquiry chairman Lord Justice Leveson analyses options for newspaper regulation.