The editor of The Standard, Nevhanji Madanhire and reporter Nqaba Matshazi were charged with criminally defaming, Reserve Bank advisor Munyaradzi Kereke.
This was after the paper published a story alleging that Green Card Medical Aid Society faced viability problems.
Kereke, a senior adviser to the Reserve Bank governor Gideon, owns the medical insurance firm.
In her ruling, the magistrate, Sandra Mupindu said Section 96(1) contravened freedom expression and particularly infringed on journalists’ and the media’s right to carry out their duties.
Representing the journalists, Advocate Eric Morris successfully argued that criminal defamation laws were archaic and most democracies had decriminalised defamation.
Morris said Britain, from which Zimbabwe adopted its penal code, had struck off criminal defamation from its constitution because it was found to infringe on freedom of expression.
For the State, Tapiwa Kasema had argued against the case being referred to Supreme Court, saying the application was frivolous and vexatious.
He argued that the case could be tried by the lower court.