UK govt nears Fox, Sky decision

The UK government has received the latest piece of guidance from local media regulator Ofcom as it prepares to give its verdict on whether to allow 21st Century Fox’s takeover of Sky.

Rupert Murdoch

UK culture secretary Karen Bradley received advice from Ofcom regarding the decision on August 25 and subsequently sought clarification from the regulator on some aspects of the guidance.

Bradley received a response yesterday and will now “carefully consider the advice” before making her decision “on the referral on the basis of all the evidence before her, as soon as is reasonably practicable,” the Department for Digital, Culture, Media & Sport said in a statement.

Bradley’s requests to Ofcom will be published “in due course” and the regulator intends to publish its advice at the same time, the department added.

Bradley initially referred the £11.7bn (US$15.1bn) deal to Ofcom in March and since then a series of setbacks have frustrated Fox.

Ofcom subsequently confirmed that Sky and Fox would be ‘fit and proper’ holders of broadcast licences, but Bradley sent the deal to a phase two enquiry amidst fears of its effect on media plurality in the UK.

Fox chief Rupert Murdoch already owns The Times and The Sun newspapers in the UK and there are fears his 100% ownership of Sky, including its Sky News operation, could hand him too much influence. Fox has proposed some undertakings to Ofcom, including setting up a separate editorial board for Sky News and retaining the news division’s current funding levels for five years.

While Ofcom said the remedies would mitigate the plurality risk, Bradley said she was not inclined to accept the changes.

The delays are allowing critics of the takeover, who fear it would hand Fox’s Rupert Murdoch too much power over the UK’s news agenda, more time to raise their objections.

The US media giant has already written to the UK government urging it to ignore “political pressure” from those who oppose the proposed takeover of the European satcaster.

If regulators have not completed their investigations by August 15 next year, the deal will be called off, forcing Fox to pay a £200m break-clause fee.

Fox aborted its previous attempt to buy Sky in 2011 following the phone-hacking scandal that hit Murdoch’s UK newspaper empire.

Its most recent takeover attempt has already received the green light from the European Commission’s competition authorities, which said its market investigation had found the proposed transaction “would raise no competition concerns,” and from media watchdogs in Ireland.

Sky agreed to sell the remaining 61% of its business not owned by Fox late last year.