Labour deputy leader Tom Watson says EU Commission raid on Rupert Murdoch's Fox HQ in London throws proposed Sky merger into doubt

  • EU Commission agents searched offices of Fox Networks Group in Hammersmith
  • Probe into alleged sports pay TV cartel has also spread to Dutch channel Ziggo  
  • Investigators want to know if there was a conspiracy to secure sports rights
  • Tom Watson says Fox probe should also end company's £11.7bn pursuit of Sky
  • Sky News could be bought by Disney in a deal aimed at pushing it past watchdog

An EU raid on the London headquarters of Rupert Murdoch's 21st Century Fox over alleged sports TV price fixing should derail his £11.7billion pursuit of Sky, it was claimed today.

The European Commission is probing whether Fox was part of a 'cartel' illegally conspiring with rivals to win the rights to show Premier League football, Formula One and other major sports worth billions to their businesses.

Labour's deputy leader Tom Watson has today written to Britain's competitions watchdog to demand it considers the EU investigation when it makes its ruling on Fox's propsed takeover of Sky, which is expected in the coming months.

Mr Murdoch's business is currently grappling with the UK's competition authority over plans to buy the 61 percent of British pay TV giant Sky that it does not already own.

Tom Watson has warned the European Commission's raid cast further doubt over whether he should be allowed to take full control of the broadcaster Sky.

Tom Watson has warned the raids cast further doubt over whether Rupert Murdoch should be allowed to take full control of the broadcaster Sky.
The London offices of Rupert Murdoch's 21st Century Fox has been raided over an alleged TV sports right conspiracy

Tom Watson has warned the raids over TV sports rights casts further doubt over whether Rupert Murdoch should be allowed to take full control of the broadcaster Sky

London: Last night the European Commission raided Fox in Hammersmith and have taken away documents and computer records as part of its sports TV probe

London: Last night the European Commission raided Fox in Hammersmith and have taken away documents and computer records as part of its sports TV probe

The shadow culture secretary has written to the competitions watchdog to demand it considers the EU investigation when it makes its ruling, which is expected in the coming months.

Britain's Competition and Markets Authority (CMA) regulator provisionally ruled earlier this year that Murdoch's planned takeover was not in the public interest and that a deal would hand him too much power in swaying public opinion. 

Sky News could now be bought by Disney in a deal aimed at pushing 21st Century Fox’s £11.7bn takeover of Sky over the finishing line.

Fox is willing to either sell the news arm of Sky or spin it out into an independent company in a bid to secure the approval it needs from regulators.

Will Sky still be bought up after Disney's Fox takeover deal?

In July last year Karen Bradley delayed her final decision whether to send out Fox's bid to buy Sky for a full review.

An initial Ofcom probe the previous months raised concerns about competition in UK news if 21st Century Fox is allowed to buy Sky outright.

The Culture Secretary said over the autumn she is once again 'minded' to send the deal out to the Competition and Markets Authority for a full review.

The review will now cover concerns about broadcasting standards, as well as media plurality.

Karen Bradley has not set a date for her decision but says it will be made 'as soon as possible'. 

It is likely she may give an initial view in January with a final decision next summer. 

But now Mr Murdoch's shares in Sky will pass to Disney it could see the end of any problems.

Disney and 21st Century Fox will pursue the deal but concerns about plurality are likely to lessen.

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Mr Watson is an arch critic of the Murdoch empire and has repeatedly called for the bid to be blocked because it would leave too much power in the hands of one media empire. 

In a letter to the Competitions and Markets Authority, seen by Mail Online, Mr Watson said: ‘Although the details of the raid are not yet clear it seems to me that a raid by EU officials on Fox’s offices in relation to a potential breach of EU would be intimately connected to the fitness of Fox’s corporate governance structures and their compliance with regulations.

‘I and others have expressed serious concerns about historic corporate governance failures across the Murdoch empire, and particularly at Fox News.

‘If this raid and EU investigation does reveal that Fox has violated EU law that would be another serious notch against their name, and against the proposed merger with Sky'. 

The EU probe today spread from the UK headquarters of Murdoch's Fox to a Dutch rival owned by Vodafone.

Investigators have raided offices in London and in the Netherlands over allegations a 'cartel' to win the rights to show Premier League football, Formula One and other major sports may be operating in Europe. 

Last night the European Commission raided Fox in Hammersmith and have taken away documents and computer records.

Investigators have also raided the offices of Ziggo Sport in Hilversum, north of Amsterdam - a pay TV channel owned by Vodafone.

Both Fox and Ziggo say they are co-operating with the Commission, who said today the raids are linked to possible 'anti-competitive practices'. 

The media companies spend billions of pounds every year to buy up exclusive broadcasting rights to the world's most watched sports, especially Premier League football. 

Fox Sports have exclusive rights to the Premier League while Ziggo Sport has the same for Holland. They deny any collusion

Fox Sports have exclusive rights to the Premier League while Ziggo Sport has the same for Holland. They deny any collusion

Ziggo Sport, a Netherlands-based broadcaster owned by Liberty Global and Vodafone, said it was involved in an investigation by the European Commission into a possible sports-rights cartel.

Disney's deal to buy Fox - what does it mean?

What is Disney buying?

The mega deal gives Disney film businesses including Twentieth Century Fox, Fox Searchlight Pictures and Fox 2000, which together are the homes of Avatar, X-Men, Fantastic Four and Deadpool. 

On the television side, Disney will get Twentieth Century Fox Television, FX Productions and Fox21, with shows including 'The Simpsons' and 'Modern Family.'

Disney will also get the National Geographic cable channels and Asian giant Star India.

If 21st Century Fox's deal to buy Sky goes ahead Disney will also have a massive European business for the first time.

Disney has already has announced plans to create its own streaming service in 2019 to compete with Netflix. 

Disney will now be able to beef up that offering with additional video from Fox. 

The Disney-branded service will have classic and upcoming movies from the studio, shows from Disney Channel, and the 'Star Wars' and Marvel movies.

Disney will also win majority control of Hulu, both its live-TV service and the older service with a big library of TV shows.

Before the buyout, 21st Century Fox will separate the Fox Broadcasting network and stations, Fox News Channel, Fox Business Network, FS1, FS2 and Big Ten Network into a newly listed company.

Will the Disney deal stop Fox's planned takeover of Sky?

The Government has said that it will make a decision on it this year - but Disney's future ownership could help it go through.

There have been concerns that allowing Mr Murdoch's US entertainment company to buy up Sky was dangerous on competition grounds.

But this issue will change once Disney buys it up this year.

This is because Disney will be taking on all of Rupert Murdoch's shares meaning his own media power will be reduced. 

Fox said today it will press ahead with attempts to buy the 61% of broadcaster Sky it does not already own before the Disney deal closes. 

Culture Secretary Karen Bradley was first asked to make a decision on Murdoch's proposed takeover of Sky in July and will come back this year.

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'We have been informed that the European Commission is inspecting several media companies in Europe, including Ziggo Sport,' the company said on Wednesday.

'Ziggo Sport is cooperating fully with the European Commission's inspection and is unable to comment further at this stage.'

The Commission on Tuesday raided the offices of a number of companies involved in sports broadcasting rights, including a unit of Rupert Murdoch's Fox.  

Commission agents began searching the offices of Fox Networks Group in Hammersmith, West London yesterday.

In a statement, the Commission said: 'The Commission has concerns that the companies involved may have violated EU antitrust rules that prohibit cartels and restrictive business practices'.

'Unannounced inspections are a preliminary step into suspected anticompetitive practices. [It] ... does not mean that the companies are guilty of anti-competitive behaviour nor does it prejudge the outcome of the investigation itself.'

It added: 'Officials carried out unannounced inspections in several Member States at the premises of companies active in the distribution of media rights and related rights pertaining to various sports events and/or their broadcasting'.

Sports broadcasting has become a huge business in Europe and the United States, with networks spending billions of pounds to secure exclusive rights to show games in top-flight leagues to attract viewers.

Fox Networks Group (FNG), a unit of Murdoch's 21st Century Fox Inc, had said earlier today that it was cooperating with the inspection. 

They are also believed to still be at the offices, where it is expected they will remain until as late as Thursday.

FNG is an operating unit of Fox, which distributes TV and cable channels and content around the world.

It is part of the Murdoch empire's entertainment arm, distinct from News Corp, which owns The Times and The Sun newspapers among others.  

The Commission is invested with the power to investigate firms they believe are abusing their market dominance or are involved in price fixing with other companies.   

It comes after 21st Century Fox proposed selling rolling TV channel Sky News to Disney earlier this month in order to finally seal control of pan-European satellite broadcaster Sky.

Fox - which for a long time has sought to buy the 61 per cent of British pay TV giant Sky that it does not already own - has also offered to ring-fence the 24-hour news channel instead, it said in a statement, as it looked to allay concerns over Murdoch's increasing media influence.

Netherlands: Investigators have also raided the offices of Ziggo Sport in Hilversum (pictured), north of Amsterdam - a pay TV channel owned by Vodafone.

Netherlands: Investigators have also raided the offices of Ziggo Sport in Hilversum (pictured), north of Amsterdam - a pay TV channel owned by Vodafone.

Britain's Competition and Markets Authority (CMA) regulator provisionally ruled earlier this year that Murdoch's planned takeover was not in the public interest and that a deal would hand him too much power in swaying public opinion.

'We believe that the enhanced firewall remedies we proposed to safeguard the editorial independence of Sky News addressed comprehensively and constructively the CMA's provisional concerns,' Fox said in a statement on April 3.

New York-listed entertainment titan Fox has already bid £11.4 billion for the 61-per cent of Sky it does not already own but in Britain concerns linger over the strengthening influence of Australian-born US tycoon Murdoch.

At the same time however, Disney announced last December that it would buy Fox for $52.4 billion.

Fox stressed that Disney would in any case purchase Sky News even if it didn't buy Murdoch's group.    

The CMA had also stated in January that its media plurality concerns would fall away on completion of Disney's Fox takeover.

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