The alleged leak of documents that fuelled a conflict of interest controversy around Premier Denis Napthine is being investigated by the Local Government Investigation and Compliance Inspectorate.
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On Friday the Inspectorate confirmed that after receiving a complaint it was investigating whether the Local Government Act had been breached.
The Warrnambool council documents, obtained by The Age earlier this year, raised questions about Dr Napthine's involvement in the expansion of a food processing plant owned by local businessman Colin McKenna.
Reporters from The Age and the Warrnambool City Council have been interviewed by investigators.
The editor-in-chief of The Age, Andrew Holden, said the interviews focussed on the information used in the reporters' stories. "They made it very clear to the investigation that under no circumstances would The Age reveal any information that might identify the source," he said.
A Local Government Investigation and Compliance Inspectorate spokesman said not all breaches of the Act carried penalties, and that breaches without penalties did not constitute an offence and were therefore not able to be prosecuted.
"If a section of the Act stipulates a penalty, then breaching this section is an offence and may result in prosecution. As this is an ongoing investigation no further comments will be made by the Inspectorate," the spokesman said.
