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James Murdoch warns No 10 not to shun Fox's Sky bid in Brexit run-up

The Guardian logo The Guardian 14/09/2017 Graham Ruddick
James Murdoch said inward investment in the UK creative economy is important as Britain leaves the EU. © Bloomberg via Getty Images James Murdoch said inward investment in the UK creative economy is important as Britain leaves the EU.

James Murdoch has issued a stark warning to the government not to turn its back on 21st Century Fox’s bid for Sky as the UK prepares to leave the European Union, claiming Brexit makes it more important than ever that the country attracts investment.

Murdoch said he was looking forward to going through the regulatory process on the deal if the UK “truly is open for business”.

The chief executive of Fox was speaking at the Royal Television Society convention in Cambridge after Karen Bradley, the culture secretary, confirmed that the government was referring the Fox and Sky deal to the Competition and Markets Authority on the grounds of media plurality and broadcasting standards, dealing a blow to the Murdochs.

However, in comments that will be interpreted as a warning to the government, Murdoch said: “There is a huge opportunity for companies and countries willing to act decisively and capitalise on the economic and social benefit that this industry can create. Inward investment in the UK creative economy and the positive signal it sends to companies around the world is more important than ever as the UK prepares to chart its course outside the EU.

“Indeed, the soft power of the UK’s creative identity is going to be a big part of that story. So if the UK truly is open for business post-Brexit we look forward to moving through the regulatory review process and this transformational transaction for the UK creative sector becoming an affirmation of that claim.”

Murdoch also launched a robust defence of Fox and Sky’s record in the UK, saying that record “has to count for something” with the government and regulators.

He said Fox dealt with allegations of sexual harassment at Fox News against Roger Ailes, the former boss, within two weeks of him learning of the claims and also said he welcomed the “mystery” about his own views, claiming he was seen as a “raging liberal treehugger” in the US and a “rightwing demon who is going to Foxify everything” in the UK.

Earlier, Sharon White, the chief executive of Ofcom, defended the media regulator after Bradley overruled it to refer Fox’s proposed takeover of Sky on the grounds of media plurality and broadcasting standards.

Ofcom had said the evidence available did not justify a broadcasting standards investigation and that Fox and Sky had a record of compliance in line with other major broadcasters.

However, Bradley referred it to broadcasting standards after raising concerns about a lack of compliance procedures at Fox News and corporate governance at the Murdoch’s companies.

Fox is controlled by Rupert Murdoch and his sons Lachlan and James. If the Fox bid is successful and it owns all of Sky then the satellite broadcaster will join the Sun, the Times and talkRadio in the Murdochs’ wider British media empire, giving the family a bigger reach than any news provider apart from the BBC.

White said it had been a “very detailed and rigorous process” and that Bradley had legal discretion to go against Ofcom’s recommendations.

“What is great about it is that there is transparency – it is clear at each stage the exam question that has been set and the advice that we have given,” she said.

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