SKY is not “fit and proper” to hold a broadcast licence if taken over by 21st Century Fox given the likely influence of Rupert Murdoch on its news output, the High Court heard yesterday.

Fox is currently making a second bid to acquire complete control of Sky, which is being assessed by the competition regulator on media plurality grounds.

The Avaaz Foundation is challenging Ofcom’s decision that a merged Sky/Fox entity would be “fit and proper” to hold a broadcast licence.

George Peretz QC, for Avaaz, said the case was “the latest instalment in a long-running saga” of the Murdoch family’s attempt to “acquire complete control of Sky,” after the last takeover bid “ended in ignominy” following revelations of “widespread” phone hacking at News International in 2011.

He said Fox’s current bid raised concerns given the “very serious and disturbing allegations of sexual and racial harassment and discrimination” against its former chairman Roger Ailes and “star presenter” Bill O’Reilly, and the “wholly reprehensible handling” of those allegations.

Mr Peretz said Ofcom “failed to look in detail at the extensive evidence” detailing the “corporate culture and behaviour of Fox,” and had taken “shortcuts” to reach a “positive conclusion in favour of Sky/Fox.”

He said Ofcom failed to recognise broadcasters must provide “impartial and accurate broadcast news and current affairs,” noting Sky Australia had moved “towards a ‘Foxified’ current affairs programming” after News Corporation acquired 100 per cent control.

Avaaz also said Ofcom did not properly take account of the fact that James Murdoch would be CEO of Sky/Fox, given its concerns in 2012 over his handling of the phone-hacking scandal.

Ofcom contends that its approach was “correct in law” and its conclusion was “plainly reasonable.”

The hearing continues.