Myanmar police Wednesday arrested three journalists after their paper criticised the financial management of Yangon's government, which is overseen by a protege of leader Aung San Suu Kyi, in the latest case to spark concern over press freedom.

Rights groups criticised the detention of the three from Eleven Media, which comes as the latest in a long series of cases brought against the media under vague and outdated laws.

Executive editors Kyaw Zaw Lin and Nayi Min and chief reporter Phyo Wai Win were hauled in before a Yangon court in handcuffs on Wednesday morning to hear the charges against them before being carted off to jail.

Defence lawyer Kyee Myint told AFP the case was filed over an article published Monday about the funding behind the city's bus network, a scheme run by Yangon chief minister and Suu Kyi confidant Phyo Min Thein.

"All three of them were sent to Insein prison this morning after a case was filed against them under section 505(b)," defence lawyer Kyee Myint told AFP.

The trio could be fined and jailed for up to two years if a court rules that their story was published with intent to cause -- or was likely to cause -- "fear or alarm to the public".

Their arrest is an "affront to press freedom" and a sign the government is "close to becoming an authoritarian regime," Ravi R. Prasad from the Vienna-based International Press Institute said.

"The whole media industry is under threat," said Hlaing Thit Zin Wai, founder of the Protection Committee for Myanmar Journalists.

"I even have a bag packed at home as we cannot predict when it will be our turn," he added.

The arrests came just a few weeks after the sentencing of two Reuters journalists to seven years in jail at the end of what was widely seen as a sham trial, during which a police officer testified that they had been set up.

Wa Lone, 32, and Kyaw Soe Oo, 28, had been investigating the extrajudicial killing of Rohingya men during a violent military crackdown last year against the stateless minority.

Civilian leader Suu Kyi -- a figure once lionised by the international community for her commitment to human rights -- has caught ire over the jailing, with the UN blasting Myanmar for waging "a political campaign against independent journalism".

In an interview with Japanese news outlet NHK published Tuesday, Suu Kyi said "there is a lot of press freedom in Myanmar", and suggested that those criticising her government "study what the press is doing from day to day in the country".

It is not the first time Eleven Media Group has been targeted by the authorities.

In November 2016, the paper's then editors were jailed over a column that accused a government official of receiving a watch worth $100,000 from a businessman who later won plum contracts.

Yangon authorities said they were unable to comment on the latest charges at this stage.

The next hearing will be on October 17.