BSkyB facing 'fit and proper' test by Ofcom

Ofcom is investigating whether British Sky Broadcasting (BSkyB) should still hold a broadcast licence in its current form in the wake of the phone-hacking scandal.

The Financial Times has obtained minutes of Ofcom board meetings via a Freedom of Information request after asking if the regulator is "considering the status of News International and/or James Murdoch as being 'fit and proper' persons to own the BSkyB licence".

Ofcom has confirmed to Journalism.co.uk that it launched a dedicated team to scrutinise evidence from the Leveson inquiry, ongoing police investigations and parliamentary committees.

In assessing whether BSkyB is a "fit and proper" licence holder, Ofcom "will take into account any relevant misconduct of those who manage and control the licensee," according to its rules.

James Murdoch stepped down from his role as executive chairman of News International last week but remains on the board of BSkyB, of which News Corporation, parent company of News International, is a majority shareholder.

If Ofcom finds that BSkyB fails the "fit and proper" test, it is likely that James Murdoch will be asked to stand down as chairman of BSkyB and News Corporation told to sell off a proportion of its shares to a level where Ofcom is satisfied that it is no longer in control.

Ofcom, which has posted the board meeting minutes on its website, discussed the "fit and proper" probe in September and November board meetings, code-named "Project Apple" from January.

The broadcast regulator today said in a statement that it has a duty "to be satisfied that any person holding a broadcasting licence is, and remains, fit and proper to do so", adding that "new evidence is still emerging" in relation to the hacking and corruption allegations.

"Ofcom is continuing to assess the evidence – including the new and emerging evidence – that may assist it in discharging these duties."

The regulator has also "written to, met and is in dialogue with the various authorities investigating the allegations", including "the police, the relevant parliamentary committees and MPs".

In a letter sent to Liberal Democrat MPs in July, Ofcom expresses concern that "News Corporation’s current shareholding of 39.14 per cent gives it material influence over BSkyB.

Labour MP Harriet Harman, shadow secretary of state for culture, media and sport responded in a statement, welcoming Ofcom's investigation.

"We await Ofcom's findings on this matter and their wider review into media ownership, but the important thing for the future is that never again must we have such concentration of power or monopolistic ownership across or within sectors of our media."

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