British regulators concluded on Thursday that the country's biggest satellite pay-TV group, British Sky Broadcasting, or BSkyB, was "fit and proper" to hold a broadcast license, offering a victory for its biggest shareholder, Rupert Murdoch's News Corporation.
The regulator, known as Ofcom, made the announcement in a statement after months of inquiries about the standing of BSkyB, in which News Corporation holds a stake of around 40 percent.
Mr. Murdoch had been seeking to buy full control of BSkyB when a scandal involving phone hacking by newspaper journalists broke over other parts of his British media outpost, particularly The News of the World tabloid, raising questions about BSkyB's status as a broadcaster.
"Ofcom considers that, on the evidence currently available and having taken into account all the relevant factors, Sky is fit and proper to hold its broadcast licenses," the regulator's statement said.
But it cautioned, "Ofcom's duty to be satisfied that a licensee is fit and proper is ongoing. Should further relevant evidence become available in the future, Ofcom would need to consider that evidence in order to fulfill its duty."
The statement said: "To date, there is no evidence that Sky was directly or indirectly involved in any of the wrongdoing either admitted or alleged to have taken place at News of the World or The Sun," another Murdoch tabloid in Britain. Rupert Murdoch closed The News of the World after the scandal engulfed it in July 2011.
But the regulator also found that James Murdoch, Rupert Murdoch's son who was closely involved in the running of BSkyB from 2003 until his resignation as nonexecutive chairman in April, "repeatedly fell short of the conduct to be expected" of a senior manager in his handling of the hacking scandal. There was no evidence, however, that he deliberately engaged in "widespread wrongdoing" or a cover-up of the scandal.
Ofcom said that, on the evidence currently available to it, Rupert Murdoch did not act in a "way that was inappropriate" in the scandals engulfing his British papers. James Murdoch was the chairman of BSkyB when the regulatory inquiry got under way. He remains on the BSkyB board as a nonexecutive director.
In a statement after the Ofcom ruling, BSkyB said: "Ofcom is right to conclude that Sky is a fit and proper broadcaster. As a company, we are committed to high standards of governance and we take our regulatory obligations extremely seriously. As Ofcom acknowledges, our track record of compliance in broadcasting is good."
"We are proud of our contribution as a broadcaster, the investments we make to increase choice for U.K. audiences and the wider benefits we create for the economy. After a lengthy review process, we are pleased that Ofcom has now reached its conclusion and we look forward to continuing to develop our business for the benefit of customers and shareholders alike."
BSkyB offers a palette of entertainment, news and sports channels, including Sky News.
Last May, a parliamentary panel issued a damning but disputed report on the hacking scandal saying Rupert Murdoch was "not a fit person"' to run a huge international company, adding new momentum to the regulator's scrutiny of his controlling interest in BSkyB, which is one of the most lucrative Murdoch investments.
After the publication of the parliamentary report a month later, BSkyB, distanced itself from News Corporation when Jeremy Darroch, BSkyB's chief executive told reporters: "I would emphasize that it's important to remember that Sky and News Corporation are separate companies."
Police have arrested dozens of Murdoch journalists and managers in a criminal inquiry into phone hacking, computer hacking and bribery of public officials, particularly the police. A separate judicial inquiry is investigating the behavior and practices of the British press and has heard testimony from scores of witnesses, including Rupert and James Murdoch.
By ALAN COWELL 20 Sep, 2012
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Source: http://www.nytimes.com/2012/09/21/world/europe/british-regulator-declares-bskyb-fit-and-proper.html?partner=rss&emc=rss
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