BERLIN (Reuters) - A German far-right party's legal challenge against the German postal service over its refusal to deliver the party's magazine will be decided in the Federal High Court in September.

A leader in the far-right National Democratic Party (NPD) said on Friday the challenge on freedom of speech grounds was raised by NPD deputies in the Saxony state assembly, one of two state assemblies in Germany where the far-right party has seats.

Holger Szymanski, a spokesman for the NPD in the Saxony parliament, said the party believes its constitutional rights to free speech are being violated by the postal service's refusal to distribute its newsletter, "Klartext".

"From our perspective, 'Klartext' is quite obviously a magazine," said Szymanski, whose party is seen by police agencies as the most significant neo-Nazi party in Germany since the end of the Third Reich.

The postal service is the latest company to run into a legal challenge from the NPD. Since 2008 it has refused to send out "Klartext" in the Leipzig region.

Lower state and district courts in Saxony have backed the postal service's position regarding "Klartext" and said it should not be considered a magazine but rather propaganda intolerant of different opinions. The high court said on Thursday it would issue its ruling in September.

Under German law, all newspapers must be distributed by the postal service in accordance with the principles of free speech and freedom of information.

"Political content does not play a role in the juridical decision," said Joachim Bornkamm, chief justice at the High Court of Justice, in comments that opened the trial on Thursday.

Because 'Klartext' is distributed to non-subscribers, much like advertising pamphlets, its status as a newspaper has come under question. Many Germans view it as a vehicle for nationalist propaganda rather than a news source.

This dispute is only the latest in a series as German companies attempt to avoid interactions with the NPD. In 2003, Sparkasse Bank, a savings bank, attempted to shut down the party's bank account, but was overruled by the Federal Court.

(Reporting by Sophie Duvernoy; Editing by Michael Roddy)