The European Court of Justice has heard Sony and Bertelsmann's appeal against a ruling last year to annul the original 2004 Sony BMG merger.

Representatives from Bertelsmann, Sony Corp and Europe's independent music community met yesterday in the Luxembourg-based court to put both sides' arguments over the amalgamation of Sony and BMG's recorded music businesses.

The European Commission's competition authority first approved the deal in 2004, but a European Court of First Instance ruling in July 2006 meant the Commission was required to conduct a new investigation into the enlarged company. On Oct. 3 the Commission cleared the merger for the second time.

Pan-European independent labels' trade body Impala had described the EC's October decision to approve the deal without remedies as "indefensible," claiming it had ignored the Court of First Instance's ruling.

Legal counsel for Bertelsmann and Sony Corp yesterday called on the Court of Justice to reject Impala's application for annulment of the Commission's decision or, alternatively, to have the case referred back for reconsideration to the Court of First Instance. Sony and Bertelsmann also called for Impala to pay the costs of the present proceedings.

Brussels-based Impala made the case that the Sony and Bertelsmann appeal is "in any event unfounded and unjustifiable." In a statement issued today, Impala added, "The parties are trying to reopen the facts which the court rules do not allow. An appeal can only be made on points of law."

Impala and Beggars Group chairman Martin Mills called for the July 2006 court ruling to be upheld "in the interests of Europe's consumers, music fans, and entrepreneurs."

A Sony BMG spokesman could not be reached for comment.

The Court of Justice competition hearing, case number C-413/06 P, was heard by the Grand Chamber of the Court of Justice. Only those cases deemed "particularly complex or important" are heard by the full court, which numbers 13 judges.

The European Court of Justice's Advocate General, Juliane Kokott, is expected to deliver an opinion on Dec. 13. If it is decided that the case raises no new questions of law, the court may decide after hearing Kokott to give judgment without an opinion.

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