The controversial regime of control orders, which restricts the day-to-day activities of terrorist suspects, was watered down by the law lords yesterday, but they ruled that overall the system was legally sound.

Britain’s most senior judges ruled that the most draconian power of an 18-hour curfew breached the human right to liberty but held that 12 hours was acceptable. They also opened the way to defendants subject to control orders being given access to some of the key evidence against them.

Although sensitive intelligence would be generally protected against disclosure, the principle of non-disclosure should not be so sweeping that it deprived the suspect of a fair hearing, the judges said.

Any move to allow suspects to see the evidence against them will be strongly resisted by the security services, which are anxious to protect their methods of gathering information and their sources.

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The lords also held that in some cases control orders have breached civil fair trial procedures, because secret evidence was withheld from the suspects and their lawyers.

Ministers were pleased with the ruling, which they feared could have been much worse and could even have declared the system, introduced in 2005, unlawful.

Jacqui Smith, the Home Secretary, said that she would consider a 16-hour curfew ceiling – a move likely to trigger further legal challenges.

“I am pleased that the law lords have upheld the control orders regime and judged that no existing control orders need to be weakened,” Ms Smith said. “I am disappointed that they have found against control orders containing 18-hour curfews, which I feel was required to protect national security. I believe that today’s ruling could allow us to impose curfews of up to 16 hours.”

The cases considered by the law lords involved nine terror suspects placed under control orders, including at least two who are on the run. In the High Court and the Court of Appeal the nine successfully argued that the measures violated their right to liberty and a fair trial. One of the alleged terrorists, Bestun Salim, vanished before police could issue him with a replacement order and is still at large.

Salim is accused of having links to Abu Musab al-Zarqawi, the late leader of al-Qaeda in Iraq.

In a crucial victory for the Government, all five law lords agreed that the regime did not amount to a criminal punishment – and therefore did not need to abide by ordinary court procedures.

Shami Chakrabarti, of the human rights group Liberty, said the judgments did not solve fundamental problems with the system. “These decisions will cause few celebrations at Liberty or the Home Office, and fully satisfy neither fairness nor security,” she said.

Six years of wrangles

September 2001 Attacks on World Trade Centre in New York and Pentagon, Washington

October 2001 David Blunkett publishes AntiTerrorism, Crime and Security Bill allowing indefinite detention of foreign terror suspects without charge or trial

December 2001 Act becomes law. Eight suspects detained

July 2002 Special Immigration Appeals Commission rules that the law is discriminatory and unlawful

October 2002 Appeal Court overturns the ruling

December 2004 Law lords rule rule that law is incompatible with the European Convention on Human Rights

February 2005 Charles Clarke publishes new Prevention of Terrorism Bill allowing terror suspects to be tagged and curfewed

March 2005 Control orders come in as an emergency measure

April 2006 High Court rules that control orders are an affront to justice

June 2006 High Court says antiterror law breaches human rights

October 2007 Law lords rule 18-hour curfew is breach of human right of liberty but 12 hours is not

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