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Project Canvas Clears OFT Scrutiny In Strange Ruling

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The Office of Fair Trading has taken two months to rule that… it is not supposed to investigate the BBC’s proposed Project Canvas connected TV joint venture.

Though Canvas referred itself to the OFT in March, the agency says it actually “does not have jurisdiction” to investigate because “none of the JV partners (including the BBC) is contributing a pre-existing business”. The full announcement is below.

The BBC Trust gave Canvas provisional approval back in December but deferred a final conclusion, following consultation, until after the ruling by the OFT, to which the JV had referred itself.

I would now expect a positive conclusion shortly from the trust. But opponents including BSkyB (NYSE: BSY) may be tempted to pursue other avenues, since, in the OFT’s words, “This decision does not preclude the application of other provisions of competition law and other relevant legislation.”

OFT’s statement

“The OFT has today concluded that Project Canvas, the proposed joint venture (JV) between the BBC, ITV (LSE: ITV), Channel 4, Five, BT (NYSE: BT), Talk Talk and Arqiva, does not qualify for investigation under the merger provisions of the Enterprise Act 2002.

“Project Canvas involves a proposal to build an open internet-connected television platform with common technical standards. The BBC started the project, contributing existing research and development. The contributions of the other JV Partners will be primarily financial.

The OFT has decided that it does not have jurisdiction to review Project Canvas under the merger provisions of the Enterprise Act 2002, in particular because none of the JV partners (including the BBC) is contributing a pre-existing business (