BRUSSELS - Thwarted in its bid to acquire Dutch peer TNT (>> TNT EXPRESS) three years ago, U.S. package delivery company UPS (>> United Parcel Service, Inc.) took its case to court on Wednesday, asking judges to overturn the EU veto because of "manifest errors" made by antitrust regulators.

While TNT has since moved on with its tie-up with FedEx (>> FedEx Corporation), the UPS challenge is important because it allows Europe's second-highest court to rule on key merger principles that could affect other problematic deals.

The world's biggest package delivery company wanted to expand its presence in the fast-growing Asian and Latin American markets through the 5.2-billion-euro (4 billion pounds) deal.

But the takeover was blocked by the European Commission because it said UPS had not offered sufficient concessions to fend off competition concerns. The EU competition enforcer in January this year cleared the FedEx and TNT deal without setting any conditions.

The Commission's decision is riddled with mistakes and weak legal arguments, UPS is expected to tell the Luxembourg-based General Court.

"The Commission committed an error of law and a manifest error of assessment when examining the likely price effects of the concentration," the company said, according to a filing in the Commission's Official Journal.

"By setting an arbitrary standard for verifiability of efficiencies, the Commission erred in law and diverged from the standard set by the case law."

UPS also accused the Commission of not giving it access to relevant and exculpatory evidence.

Such merger appeals are rare, said Tobias Caspary, a partner at London-based Fried, Frank, Harris, Shriver & Jacobson.

"The merger would have resulted in a 4 to 3 (major industry players) scenario that often attracts substantial scrutiny by the EC (Commission). Interestingly, TNT's subsequent acquisition by FedEx was cleared unconditionally. Comparing these two scenarios offers an interesting insight into which cases fall across the prohibition line and which don't," he said.

The court is expected to rule in the coming months. The case is T-194/13 United Parcel Service v Commission.

(Reporting by Foo Yun Chee; Editing by Mark Potter)

By Foo Yun Chee

Stocks treated in this article : FedEx Corporation, United Parcel Service, Inc., TNT EXPRESS