The charge sheet, due Wednesday, would raise concerns about the impact combining Sony Music and Bertelsmann's BMG would have on competition in the recording industry as well as in the emerging market for online music and devices, sources familiar with the case said on condition of anonymity.

Bertelsmann spokesman Rollo Head confirmed that "we are expecting a statement of objections," but declined to elaborate. A Sony spokesman declined to comment.

A statement of objections is a standard step in EU antitrust reviews and usually results in divestitures or other commitments from the companies involved to win approval.

In opening an in-depth probe into the Sony BMG case last February, EU antitrust officials expressed concern that the 50-50 joint venture "might create or strengthen a collective dominant position" in the recorded music market.

They also questioned whether Bertelsmann's television assets or Sony's music downloading services and equipment would be affected by the deal.

Just this month, Sony Corp., parent of Sony Music, launched an online music download service, Sony Connect, which offers more than 500,000 tracks from artists on major and independent labels.

The European Commission briefly suspended its probe last month while it awaited answers to requests for more information from the companies on copyrights, author contracts and record licensing.

Regulators also wanted more clarification on aspects of their music recording and publishing businesses.

The European Commission has until July 22 to decide on the tie-up, which would reduce the number of major music companies to four.

Similar concerns about increased chances for market dominance by a reduced number of majors were a large part of the EU's objections four years ago to a deal between giants EMI Group PLC and Warner Music Group Inc.

story here

http://www.sfgate.com/cgi-bin/article.cgi?f=/news/archive/2004/05/17/financial1042EDT0055.DTL

Why is it the European Union is the only Government worried about this Cartel's Monopoly??

"The charge sheet, due Wednesday, would raise concerns about the impact combining Sony Music and Bertelsmann's BMG would have on competition in the recording industry as well as in the emerging market for online music and devices"

this is the biggest most illogical steaming load i have ever seen!

theyre already colluding, and the current "market" theyre talking about is virtually nonexistent, and WILL die off as long as they continue to try to force funky formats that are "this only" and "that only".

nobody i know is going "yaay.. atrac3.. i want one of those things so they can rheam out my colon with the price of their minidisc players, then change the standard and abandon all support!... yaaaay!"

That's a good question, compmore - one that more people should be asking. I believe that it's because the EU consists of a number of countries. Diversity - good, going along with the mindset of a powerful entity - bad. With more members, there can be more dissenting opinions which can be given more weight. (Also, maybe they're not paid off as easily as some congresspeople in the US)