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Supreme Court rules financial restrictions on Iranian bank unlawful

19/06/13

A nine judge Supreme Court today upheld on both substantive and procedural grounds Bank Mellat's challenge to a Treasury Order under the Counter Terrorism Act 2008 imposing financial restrictions. The effect of the Order was effectively to close down Bank Mellat's UK operations. It was imposed to disrupt the Iranian nuclear weapons and ballistic missile programme. The Order was quashed.

The Court ruled, by a bare majority of 5-4, that the Order - which singled out Bank Mellat and left other Iranian banks untouched - was irrational and disproportionate. It also held, by a differently constituted majority of 5-4, that the Order was vitiated by a demonstrably unfair procedure because it failed to give the bank notice of its intention to make the Order or an opportunity to make representations. The leading judgment was given by Lord Sumption.

In a separate judgment, the Court gave its reasons for holding (by a majority of 6-3) that it had jurisdiction to hold a closed hearing; and for deciding (by a majority of 5-4) to exercise that jurisdiction.

The judgment is here.

The Supreme Court YouTube summary is here.

Martin Chamberlain QC was Special Advocate for the bank. He made submissions on its behalf in both the open and closed hearings.