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BT's planned broadband TV joint venture with the BBC and ITV could be subject to an investigation from media regulator Ofcom.

Project Canvas will enable consumers to access on-demand content over the internet to watch on traditional TV sets.

However, Ofcom has warned that the proposals could face close attention from the authorities following the Competition Commission's ruling on Project Kangaroo earlier this year.

The failed project was disbanded after the commission ruled the on-demand plan would contravene competition legislation and reduce choice for consumers.

Ofcom's partner for strategy and market development Peter Phillips raised these concerns in a letter sent to the BBC Trust and seen by the Guardian.

"We understand that issues relating to the compliance of Canvas with all relevant competition obligations will be considered within the trust's assessment, including those arising from arrangements specific to the BBC and also those arising as a result of competition, merger and state aid law," he said.

"In that regard we recognise that there may be a future role for the OFT and/or Ofcom to assess the arrangement under relevant merger or competition law."

The BBC Trust launched the first stage of its public consultation on Project Canvas in February and is expected to publish the results by June before a final decision is delivered in July.

If approved, the organisation suggests that the service could be available from as early as 2010.

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