Britain to refer Rupert Murdoch's Sky bid to competition regulator

Rupert Murdoch's £11.7bn bid to take full control of Sky is to be referred to the competition regulator for further investigation, the UK's Culture Secretary has said.

Karen Bradley has been assessing thousands of responses following a consultation about the proposal from 21st Century Fox.

After weeks of deliberation, Ms Bradley confirmed she intends to ask the Competition and Markets Authority (CMA) in Britain to conduct a fuller investigation into the bid on the grounds of media plurality.

She added she is also now minded to refer the merger to the CMA on the grounds of "genuine commitment to broadcasting standards".

Ms Bradley outlined her decision on whether to refer the bid for a six-month investigation to the CMA in a statement in the Commons.

She said: "Turning to the question first of media plurality, I can confirm that none of the representations received have persuaded me to change my position.

"Accordingly I can confirm my intention to make a referral on the media plurality ground to the CMA."

On broadcasting standards, Ms Bradley said Ofcom had been asked to provide further advice before telling MPs: "I have taken careful account of all relevant representations and Ofcom's advice and have today - as required by the legislation - written to the parties to inform them I am now minded to refer the merger to the CMA on the grounds of genuine commitment to broadcasting standards."

Ms Bradley said the legal threshold to refer a bid to the CMA is low, and she has the power to do so if she believes there is a non-fanciful risk of a merger operating against specified public interests.

She said the first concern was around Fox's compliance procedures for the broadcast of Fox News in the UK, noting the company only took action to improve its approach after Ofcom expressed concerns.

Ms Bradley said: "Ofcom has now confirmed it considers this to raise non-fanciful concerns but which are not sufficiently serious to warrant referral.

"I consider that these non-fanciful concerns do warrant further consideration.

"The fact that Fox belatedly established such procedures does not ease my concerns, nor does Fox's compliance history.

"Ofcom was reassured by the existence of the compliance regime which provides licensees with an incentive to comply.

"However, it is clear to me that Parliament intended the scrutiny of whether an acquiring party has a 'genuine commitment' to attaining broadcasting standards objectives to happen before a merger takes place."

Ms Bradley said concerns were also raised about the "Foxification" of Fox-owned news outlets internationally.

She said: "On the evidence before me I am not able to conclude that this raises non-fanciful concerns.

"However, I consider it important that entities which adopt controversial or partisan approaches to news and current affairs in other jurisdictions should, at the same time, have a genuine commitment to broadcasting standards here.

"These are matters the CMA may wish to consider in the event of a referral."

Ms Bradley said Ofcom had concluded concerns over corporate governance failures do not warrant a referral, adding: "I agree that corporate governance issues at Fox raise non-fanciful concerns, but in my view it would be appropriate for these concerns to be considered further by the CMA.

"I agree with the view that, in this context, my proper concern is whether Fox will have a genuine commitment to attaining broadcasting standards objectives.

"However, I am not confident that weaknesses in Fox's corporate governance arrangements are incapable of affecting compliance in the broadcasting standards context.

"I have outstanding non-fanciful concerns about these matters and I am of the view that they should be further considered by the CMA."

Broadcasting giant Sky, which is listed on the FTSE 100 Index, saw its shares fall 3% after the announcement.

More in this Section

Permanent TSB defends plan to sell tens of thousands of mortgages

Lloyds cheers 'landmark year' after profits jump

Economic Outlook looks good for Ireland, says Bank of Ireland

Kerry boss upbeat despite near 5% share slide

Today's Stories

China in our hands as Irish exports hit heights

On Brexit, the rubber hits the road for UK car firms

Shares worry focus on US rates

Brexit will hurt bad but let’s not overstate the costs


The biggest cancer killer will take your breath away

Hopefully she had an idea...

Power of the press: Meryl Streep and Tom Hanks discuss 'The Post'

More From The Irish Examiner