Sky bid faces another hurdle as Avaaz wins right to legal challenge

A campaigning group opposed to Rupert Murdoch’s takeover of Sky has won permission to launch a legal challenge to the media regulator’s ruling that the broadcaster would remain “fit and proper” to hold a UK licence if it was owned by 21st Century Fox.

A high court judge has said that the activist group Avaaz will have its case for a judicial review of Ofcom’s decision that Rupert Murdoch and his sons would be “fit and proper” owners of Sky heard before 30 June.

“The case is arguable and may raise some important points of principle,” said Justice Morris. “Permission is hereby granted.”

Avaaz has argued that Ofcom’s process and decision was flawed in a number of ways, including that it is too easy for subjects of fit and proper tests to be cleared.

It also claimed the regulator had made errors when assessing 21st Century Fox’s compliance with the UK broadcasting code, drew “wrong conclusions” from allegations of sexual and racial harassment at Fox News, and ignored the role Murdoch’s son, James, would play as chief executive of 21st Century Fox.

The judge said that it is not necessarty for the outcome of Avaaz’s court case to be known before the UK competition regulator publishes its final verdict on whether to clear Fox’s £11.7bn takeover of Sky in April.

The deal is being scrutinised because it raises media plurality issues, as full ownership of Sky would give them control of Sky News as well as the Sun and the Times.

The Competition and Markets Authority is looking at options regarding the future of Sky News, including whether it needs to be sold, spun off or just made editorially separate from Sky in order to resolve the media plurality issue.

If Avaaz were to win its case then Ofcom would be forced to reconsider its fit and proper decision, which could provide yet another hurdle for the Murdochs.

An Ofcom spokesman said: “We will defend our ‘fit and proper’ assessment, which was independent, expert and based on the evidence.”