The European Commission has sent a statement to the music units of Japan's Sony Corp. and Germany's Bertelsmann AG, objecting to a proposed merger between the two units, a Sony official said Tuesday.

The so-called statement of objections lays out why the European Union's executive body believes the proposed merger between Sony Music Entertainment Inc. and Bertelsmann's BMG would be unacceptable under the EU's competition law.

The Sony official said that the New York-based Sony Music Entertainment has received the statement -- but declined to reveal the specific reasons outlined by the commission.

"The European Commission raised several points it believes pose problems under the EU's competition policy," the spokesman said.

Last December, Sony Music Entertainment, the world's No. 2 music group, and BMG, No. 5, reached a final agreement to set up a 50-50 joint venture that will be called Sony BMG.

On Jan. 9, Sony and Bertelsmann sought EU approval for the plan.

The deal would create an entity that would hold about 25 percent of the global music market, trailing behind Universal Music Group of the United States.

In February, the European Commission began studying the proposal, saying the deal might "create or strengthen a collective dominant position" in the world music market.

Sony Music Entertainment and BMG have about two weeks to reply to the European Commission's latest statement in writing. The commission has set July 22 as a deadline on whether to accept the deal, to prohibit it or to attach conditions to it.

In a news release issued after the European Commission's latest action, Sony Music Entertainment said the statement of objections "does not prejudge the outcome of the proceeding."

"We remain confident that the European Commission will ultimately find that the Sony BMG joint venture is a procompetitive response to the challenges faced by the recorded music industry," Sony Music Entertainment said.

If the commission endorses the deal, the number of major music groups in the world will drop to four -- Universal Music Group, Warner Music Group, EMI Group and Sony BMG.

The market in question consists of signing artists, recording songs, marketing artists and their work, and selling CDs. But the joint venture excludes music publishing and CD production as well as Sony's music business in Japan.

The merger plan follows a recent slump in the global music industry, which has been hit hard by music piracy, weak retail sales and increasing competition in the entertainment industry, industry officials say.

Major music companies, including Universal Music Group and EMI Group, are reportedly against the proposed joint venture between Sony and Bertelsmann.

A group of independent record labels has also raised strong objections to the plan.

Three years ago, the European Union scuttled a deal between EMI Group and Warner Music Group.

Software assets wanted

Sony Corp. is interested in pursuing a deal with Hollywood studio Metro-Goldwyn-Mayer Inc. for its rich software assets, Sony Chairman Nobuyuki Idei said in an interview published Tuesday.

"We would like to capitalize on MGM's software assets," Idei told the Nihon Keizai Shimbun on Monday. "A software business consists of assets from past products and future movies, but the importance of software made in the past is growing now that many sales channels are available, including broadcasting, DVDs and the Internet.

"The acquisition would give us MGM's production and distribution rights for future films as well," he said. "If we decide to ink the deal, the purchase price will not be as large as some people may estimate."

Sony Corp. is reportedly in talks to acquire MGM for around $5 billion.

Separately, Idei said Sony plans to introduce in 2006 a television featuring a high-performance chip it is developing with IBM Corp. and Toshiba Corp.