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Ofcom to investigate proposed 21st Century Fox Sky merger
MUMBAI: UK media watchdog Ofcom will investigate the proposed merger between 21st century Fox and Sky, worth $14.6 billion.
The Secretary of State issued a European Intervention Notice, confirming that she is intervening in the merger on the two grounds of media plurality and commitment to broadcasting standards.
Ofcom will now prepare a report on the public interests specified, and the Competition and Markets Authority (CMA) will prepare a report on jurisdictional issues. They both have 40 working days, by midnight 16 May, to complete and submit these reports.
21st Century Fox said in a statement that it welcomes a thorough and thoughtful regulatory review.
“We believe this transaction is in the interest of the UK, its creative economy and its consumers. For the past 30 years, 21CF and Sky have been broadcasters of good standing in the UK, a responsibility we take seriously. The UK has a thriving creative and media sector that is becoming increasingly more plural and we are confident that this transaction would not result in there being insufficient plurality in the UK. We will continue to work with all relevant regulatory authorities in assisting their reviews.”
It responded regarding the European Intervention Notice issued by the UK Department for Culture, Media and Sport saying, “21st Century Fox looks forward to working with UK authorities in their reviews of our proposed transaction to combine with Sky. We are confident that a thorough review of our track record over 30 years will underscore our commitment to upholding high broadcast standards, and will demonstrate that the transaction will not result in there being insufficient plurality in the UK. The media market has changed dramatically in recent years, as has our business. We believe our proposed £11.7 billion investment will benefit the UK’s creative industries. We look forward to continuing to work with all stakeholders and are confident that the transaction will be approved.”
On 9 December 2016 Sky had announced that it had received an approach from 21st Century Fox to acquire the 61% share of Sky which it does not already own.
Under the powers set out in the Enterprise Act 2002, the Secretary of State for Culture, Media and Sport is able to intervene on the basis of specified media public interest considerations, which refer to the need for there to be a sufficient plurality of media ownership, for the availability of a wide range of high-quality broadcasting and for those with control of media enterprises to have a genuine commitment to broadcasting standards objectives. This responsibility is discharged in a quasi-judicial capacity.
On 3 March 2017 the European Commission confirmed that it had received formal notification of the proposed merger. On the same day, the Secretary of State wrote to the parties and issued a press statement confirming that she was minded to intervene on two public interest grounds – media plurality and commitment to broadcasting standards objectives and invited further representations for consideration before coming to a final decision. She made a statement in the House, to this effect, on 6 March.