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In July The European Court of First Instance overturned the European Commission's approval of the merger, granting a motion by the Independent Music Publishers and Labels Association (Impala). This argued that the deal would concentrate power in the music business into a small cartel of industry giants and harm competition.

The courts unexpected ruling compelled the

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Commission to hold a new investigation into the merger and also threatened the proposed merger of two of the other big five record companies, EMI and Time Warner.

BMG said in a statement that together with Sony it believes that the Commission's approval 'was correctly decided on both the law and the facts'.

The appeal will be heard by the European Court of Justice in Luxembourg and is expected to last more than a year.

The appeal will not affect the Commission's re-investigation of the merger. Bertelsmann said in its statement that it will soon supply the information that the Commission has asked for.

'In connection with that process, the parties will be providing current market data and other information requested by the Commission in the next few weeks,' the company said.

The Commission will re-examine several questions, including the potential impact on competition in the music market. Any concerns that it has may be passed on to Sony and BMG, with a request for possible remedies.