Bosses at record giant SONY BMG have won a ruling at Europe's highest court - throwing out a challenge to the 2004 merger of two of music's biggest labels.

Sony and Bertelsmann Media Group won the decision in The European Court of Justice on Thursday (10Jul08) - overturning a 2006 decision.

The proceedings determined a lower court had made "errors of law" by ruling against the merger.

Legal battles have ensued since the companies joined forces in 2004 - after independent labels complained that the shrinking number of major music firms would reduce competition.

The media group's lawyer John Boyce insists the decision won't have a "real commercial impact" on Sony BMG, although the decision helped to clarify the European Union's merger process.

Approval for the media group to combine its music units led to the creation of the world's second largest record label.

The formation of Sony BMG has joined labels including Arista, Jive, Epic and Columbia and houses artists including Shakira, George Michael and Avril Lavigne.