Sky/21st Century Fox: Merger

Debate between Karen Bradley and Ed Miliband

Thursday 16th March 2017 Commons Chamber

[Karen Bradley]

I thank my hon. Friend for his comments. I agree that media plurality is important, which is why I have asked Ofcom to look at the proposed merger and to make a decision, on the grounds set out in the Enterprise Act 2002, about whether it will affect media plurality. Like him, I am optimistic that, following Brexit, the UK broadcasting industry will continue to thrive and to be the world-leading industry that it is today.

[Edward Miliband (Doncaster North) (Lab)]

I welcome the Secretary of State’s decision to refer this bid. Many of us believe that in view of the conduct of the Murdochs and the untrammelled power that they already have, it is not in the public interest for them to take over Sky and have full control.

I want to ask about the question of fitness, which I know the Secretary of State has thought about a lot. The 2011 Ofcom review took 15 months to look at the fitness of the Murdochs, but she expects Ofcom to report back to her within 40 days. There is a question about timescale and powers, as my hon. Friend the Member for West Bromwich East (Mr Watson) has said. Can she assure us that if during this period Ofcom seeks more time, or indeed more powers, to carry out the fitness review, she will grant its request?

[Karen Bradley]

Ofcom has assured me that it has the time and the powers that it needs, and I look forward to seeing its report in due course.

Sky/21st Century Fox: Proposed Merger

Debate between Karen Bradley and Ed Miliband

Monday 6th March 2017 Commons Chamber

[Karen Bradley]

Perhaps I can reassure my hon. Friend the Member for North East Somerset (Mr Rees-Mogg). I am, in a quasi-judicial capacity, looking at the rules as set out in the Enterprise Act 2002. I am very much aware of those rules and I am sticking to the letter of those rules. I want to make sure that the process is scrupulously fair and that all parties have the opportunity to make representations before I make a decision.

[Edward Miliband (Doncaster North) (Lab)]

I welcome the Secretary of State’s coming to the House and her apparently robust intentions. Nevertheless, like my Front-Bench colleague, my hon. Friend the Member for West Bromwich East (Mr Watson), I am worried about the issue of the fit and proper test, and I wish briefly to explain why. The key thing about the test is that it is wider than the test on broadcasting standards. Many of us believe that the Murdochs are in no way fit and proper to have full control of Sky, given their corporate record. Can the Secretary of State clarify something I have not been able to establish on the basis of my correspondence with Ofcom? First, will the fit and proper test that Ofcom is going to conduct take place before the bid can be completed? Secondly, if there is no clarity on that, why does the Secretary of State not do what she can do under the Enterprise Act, which is to specify fit and proper as a third ground for referral to Ofcom, to make sure that such an assessment takes place?

[Karen Bradley]

The Enterprise Act is clear about the grounds on which the quasi-judicial decision can be taken. I can intervene on the grounds of media plurality, range and quality, and genuine commitment to broadcasting standards. The right hon. Gentleman will know that fit and proper is an ongoing test for Ofcom to apply to the holders of broadcasting licences. Although many of the issues that Ofcom would consider in reaching a judgment are also relevant to me in considering genuine commitment to broadcasting standards, the tests are different and apply at different points in time.

Sky: 21st Century Fox Takeover Bid

Debate between Karen Bradley and Ed Miliband

Tuesday 20th December 2016 Commons Chamber

[Edward Miliband (Doncaster North) (Lab)]

(Urgent Question): To ask the Secretary of State for Culture, Media and Sport to make a statement on the timetable of, and the approach of the Government to, 21st Century Fox’s bid to take over Sky now that the bid has been agreed, and whether the Government plan to refer the bid to the competition authorities.

[The Secretary of State for Culture, Media and Sport (Karen Bradley)]

As hon. and right hon. Members know, Sky plc announced on Friday 9 December that it had received an approach from 21st Century Fox Inc. to acquire the 61% of shares in Sky plc that it does not already own. The Minister for Digital and Culture, my right hon. Friend the Member for West Suffolk (Matt Hancock), made a statement on 12 December about the proposed bid and the process that would need to be followed. I recognise that this is an issue of significant interest to the public and that it has raised a lot of interest in Parliament, as well as being a significant issue for the parties concerned. It is very important I make it clear that the role I will play in this process is a quasi-judicial one. As the Secretary of State, I am able to intervene in certain media mergers on public interest grounds, as set out in the Enterprise Act 2002. Government guidance on the operation of the public interest merger provisions under the Act gives an indication of how the intervention regime will operate in practice and of the approach I will aim to take. The most important concern for me is that the integrity of the process is upheld. The guidance makes it clear that I will aim to take an initial decision on whether to intervene on public interest grounds within 10 working days of formal notification of the merger to the relevant competition authority.

No such formal notification has yet been made. Unless and until a formal notification is made to the relevant competition authority, I will not be taking any decisions in relation to the bid. It is for the parties formally to notify the relevant competition authorities. It is at that point that I will need to consider whether any of the public interests specified in the legislation merit an intervention. My decision on whether or not to intervene will be a quasi-judicial one, and it is important that I am able to act independently and that the process is scrupulously fair and impartial. Given that, it would be inappropriate for me to comment further on this proposed bid at this point if the integrity of the process is to be protected and everyone’s interests are to be treated fairly.

What I can say is that I understand the significant public and parliamentary interest in this matter, and I do not for a minute underestimate it. This is also clearly a significant issue for the parties to the bid. It is therefore crucial that the integrity of the process is protected. I will not be making any further comment on the process or the merits of the bid today, but I can confirm that this matter is being treated with the utmost seriousness and that, should the parties formally notify the bid to the relevant competition authorities, I will act in line with the relevant legislation, the guidance and the quasi-judicial principles.

[Edward Miliband]

I thank the Secretary of State for her reply. The urgency of the House considering this matter today is that we are going into recess until 9 January, and the bid may be notified to the Government at any time.

It is very important that the House understands the reality that in even launching this bid for 100% of Sky, the Murdochs are seeking to turn the judgment of this House, the regulator and indeed the country on its head. In 2011, this House unanimously urged the withdrawal of the bid for Sky by Rupert Murdoch. In 2012, Ofcom published a damning assessment of James Murdoch’s behaviour in the running of News International. That report stopped short of declaring Sky as unfit and improper to hold a licence only on the basis that the Murdochs were a minority—not 100%—owner of Sky, and that James Murdoch was no longer playing an executive role at Sky.

Today James Murdoch is back, as chairman of Sky and chief executive of 21st Century Fox. This bid shows the Murdochs have learned nothing and think they can get away with anything. If it was wrong for the Murdochs to own 100% of Sky in 2011 and 2012, it is wrong today. We have seen the convictions of their senior employees for phone hacking and perverting the course of justice, and of police and public officials for taking payments from News International employees. We are still yet to have part 2 of Leveson, which was supposed—I am quoting its terms of reference—to examine the

“corporate governance and management failures at News International”.

Why? Because this Government are seeking to ditch part 2 of Leveson. We all said across this House in 2011 that never again would we allow the Murdochs to wield unfettered power, yet here we are all over again.

May I ask the Secretary of State: first, has she read the Ofcom report of 2012 into James Murdoch, and will she tell us what she thought of its contents; secondly, will she tell us how this bid can even be considered to be in the realm of reality when part 2 of Leveson, specifically tasked with looking at the failures of News International, has not taken place; and thirdly, will she hear the message loud and clear that if the House were to return on 9 January to find the waving through of this bid, that would be totally and utterly unacceptable and fly in the face of the expressed will of the House and the country? Will she assure us today that this will not happen?

On the steps of Downing Street, the Prime Minister said she would stand up to the powerful. If ever there was a chance to prove it, it is today.

[Karen Bradley]

I do not for one second underestimate the huge public and parliamentary interest in this proposed merger, nor the importance of the issue to the parties concerned. But I must ensure, given my quasi-judicial role, that I protect the integrity of the process and ensure that, as and when a formal notification is given—if it is—it is properly considered. I will be making no further comments on the merits of the bid at this stage.