Bank ruling to trigger wave of suits over Iran sanctions
A European court has potentially fired the starting gun on landmark litigation over EU relations with Iran by ruling earlier this week that one of country's leading banks was unfairly caught in Brussels-dictated sanctions.
Lawyers for Bank Mellat said yesterday that they were preparing to sue EU governments for damages following the court ruling, according to the Reuters news agency.
Reuters reported that Europe’s first instance court ruled the EU had failed to provide sufficient evidence that the bank was linked to Iran’s alleged nuclear power programme. Europe hit the bank with sanctions more than two years ago – but the court has ruled those restrictions should be lifted.
According to a statement from the bank’s law firm, London-based Zaiwalla & Co, the ruling – which the EU could appeal to the Court of Justice – will have far reaching international implications. The firm maintained that the judgment ‘gives a clear message ... that European Institutions do not have the unfettered discretion to impose sanctions on whomsoever they like. This win reminds the institutions that they too are subject to the rule of law, which provides that the imposition of sanctions upon and individual or entity requires evidence’.
The firm said the EU sanctions were imposed on the bank on the grounds that it was state owned. However, the firm maintains Tehran owns only 20 per cent of Mellat, and that there is no evidence of ‘any wrongdoing or links with Iran’s nuclear programme on the part of the bank’.
Sarosh Zaiwalla, the law firm’s senior partner, commented said the European court had ‘concluded that fairness and the rule of law are more important than temporary political objectives. Bank Mellat is a private bank, and the Council of the European Union has provided no evidence for justifying its sanctions. Bank Mellat should never have suffered simply because it happens to be based in a country of whose government the EU disapproves’.