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Iran Bank scores victory over UK Treasury

|By TAP Staff| Iran’s Bank Mellat, one of the most high-profile private entities sanctioned in 2009 for alleged links to Iran’s nuclear programme, won a morale-boosting victory against the British Treasury this week when a Court of Appeal upheld its demand for greater disclosures about the charges being leveled against it.

The verdict was based on the principle that the accused has a right to know what is being alleged against it. This fundamental principle is based on the premise that disclosure of sufficient material is essential for the accused to effectively counter the accusations.

The decision of the Court of Appeal concerns the application made by Bank Mellat for disclosure by the UK government of the gist of the closed material held by the government against the bank. The bank’s application for the disclosure was made on the ground that the bank was unable to prepare evidence for the hearing of its claims, in which it was challenging its designation by the UK Government in 2011 and 2012, on grounds of proportionality and discrimination.

The bank’s case was that it was unable to understand, let alone refute, the treasury’s open case and that the allegations were advanced in such general terms that the bank could not provide adequate instructions to the special advocates.

This Judgment is landmark on the issue of how much and what information the government should disclose to a defendant in closed material cases, it was stated on behalf of Zaiwalla & Co Solicitors, which appeared on behalf of the bank.

The idea that it might be possible to have a fair trial even without knowing any of the evidence was left open by a House of Lords decision in 2007. Subsequently, a number of High Court judges found it very difficult to apply but the possibility was upheld by the Court of Appeal in October 2008. In February 2009, however, the European Court of Human Rights ruled in a series of cases that there was an absolute right to disclosure of some of the secret evidence under article 5(4) of the European Convention on Human Rights (ECHR).

In 2013, Zaiwalla & Co. successfully lifted the sanctions on the Bank, as the UK Supreme Court ruled the UK Government’s listing of the Bank to be “irrational” and “arbitrary”. Zaiwalla & Co., on behalf of the Bank, is now filing a £2.3billion ($4billion) damages claim against HM Treasury.