Sovio Wines has entered its second day in the High Court calling for the Food Standard Agency to drop a ban on its low alcohol wine.
The company is seeking judicial review against the Food Standards Agency, which claimed the drink, with an alcohol content of just 8%, was illegal under EU law. Sovio lawyers are arguing at London's High Court that the FSA "acted in excess of its jurisdiction" in imposing the ban.
If successful, Sovio could be awarded a six figure sum in damages.
The FSA's Wine Standards Branch imposed a movement control order on the product in August 2007 because the wine had been subjected to spinning cone treatment - a device which strips out alcohol - a practice that is illegal in EU countries.
An FSA spokeswoman told Harpers: "The issue this hinges on is the issue of re-engineering wines and wines that have had their alcohol level artificially lowered. They are not legal in the UK, and we have to enforce EU regulations."