press release
Commission decision on Sky’s ITV stake sets tone for 2008
20 December 2007
The Competition Commission has today confirmed that the
acquisition by British Sky Broadcasting Plc (BSkyB) of a 17.9%
share in ITV Plc restricts competition and therefore operates
against the public interest.
The Commission has recommended that BSkyB reduce its 17.9%
holding in ITV to below 7.5%. It also wants the broadcaster to give
an undertaking that it would not seek representation on ITV's
board.
Fiona Carter, Regulatory Partner at law firm Browne Jacobson,
said:
“The Competition Commission has clearly chosen a "halfway
house" between these two extremes. Whilst ITV may view this as a
"winning score draw" Sky may feel that any financial loss they may
have incurred in the process was probably worth it since it blocked
Virgin Media's proposed acquisition of ITV. It seems highly likely
that John Hutton’s final decision will reflect this
compromise.
“Although many will not be surprised at this proposal, it
does reflect the change in profile being adopted by the OFT. The
OFT’s image as a "remote" regulator is being radically altered as
it shows itself increasingly willing to actively review business
decisions where they appear to directly affect the consumer.
Business and consumers can expect to see a lot more muscle flexing
from the OFT in 2008".
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