Britain's competition regulator says the planned takeover of Sky by Rupert Murdoch's Twenty-First Century Fox is not in the public interest because it would give the media mogul too much influence, but set out possible remedies that could allow the $18.82 billion deal to go ahead.

Key points: Regulator says deal would give Murdoch too much control over provision of news

Regulator says deal would give Murdoch too much control over provision of news Regulator suggests Sky News could be spun off, divested or insulated from Fox News

Regulator suggests Sky News could be spun off, divested or insulated from Fox News Government will receive the regulator's judgement on the takeover on May 1

The initial ruling complicates a plan by Walt Disney Co to buy many of Mr Murdoch's assets, including the pan-European satellite business Sky.

Disney had hoped that Mr Murdoch would have taken full control of Sky by the time the US group completed its takeover.

But Britain's Competition and Markets Authority said on Tuesday that the deal as proposed went against the public interest because it would give the Murdoch family too much control over the provision of news.

The CMA said possible ways to resolve its concerns about Mr Murdoch's influence in Britain could include spinning off or divesting Sky News, or insulating Sky News from Fox's influence.

A third option is to block the deal outright.

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It did, however, clear Mr Murdoch on the issue of broadcasting standards, saying that recent allegations of sexual harassment at his Fox News organisation in the United States did not call into question his commitment to upholding standards in Britain.

Labour Party deputy leader Tom Watson praised the regulator's ruling, tweeting that it was "the right decision for the UK".

The Government, which will make the final decision on the takeover, will now receive the regulator's judgement on the takeover on May 1, which is later than expected.

Reuters