Government refers Fox's Sky bid to Ofcom

17 Mar 2017

Karen Bradley, the United Kingdom’s Secretary of State for Culture, Media and Sport, yesterday (16 March) issued a European intervention notice requesting local telecoms regulator Ofcom to report on the effects of the proposed transaction under which Twenty-First Century Fox is seeking to acquire those shares in Sky plc that it does not already own.

Having been given until 16 May 2017 to submit its report (including its recommendation and a summary of stakeholders’ proposals) and any other relevant material to the Secretary of State, the regulator has called for comments by interested parties, setting a deadline of 30 March for written submissions.

Under the notice, Ofcom will examine the proposed deal with a specific focus on two key areas, namely: ‘the need, in relation to every different audience in the United Kingdom or in a particular area or locality of the United Kingdom, for there to be a sufficient plurality of persons with control of the media enterprises serving that audience’ (the ‘plurality public interest consideration’); and ‘the need for persons carrying on media enterprises, and for those with control of such enterprises, to have a genuine commitment to the attainment in relation to broadcasting of the standards objectives set out in section 319 of the Communications Act 2003’ (the ‘broadcast standards public interest consideration’).

Meanwhile, Ofcom noted that the public interest assessment that it has been asked to make by the Secretary of State and its ongoing duty under the Communications Act to assess whether a licensee is fit and proper are separate legal processes. Moreover, it notes that the issues it is tasked to consider in the public interest assessment may overlap with its own consideration of Sky’s fitness to hold broadcasting licences in the event of a change of control. As such, it has proposed considering these matters within the same timeframe for which it will report to the Secretary of State on the public interest assessment.

United Kingdom, Department for Digital, Culture, Media & Sport (DCMS), Ofcom, Sky