The British government has settled a 1.25 billion pound ($1.6 billion) damages claim brought by Iran’s largest private bank in an 11th-hour, out-of-court deal following a dispute over sanctions.
Bank Mellat, which is 20% owned by the Iranian government and 80% privately held, said on Tuesday the legal row had been resolved for an undisclosed sum on the first day of a trial to assess its damages at London’s High Court, Reuters reported.
That comes six years after the UK Supreme Court ruled that sanctions imposed on the bank in 2009 were unlawful and that the government had been “irrational” and “disproportionate”. It referred the case back to the High Court, according to Financial Tribune.
Bank Mellat had argued that sanctions had damaged its reputation and goodwill in Britain and internationally, and caused significant loss.
The government’s treasury department issued a brief statement, saying: “Bank Mellat’s claims have been concluded on terms confidential to the parties.”
Sarosh Zaiwalla, a lawyer and founder of London-based Zaiwalla & Co, the law firm represented Bank Mellat.
Earlier this month, Iran's Bank Mellat said it would sue the UK Treasury for compensation over financial restrictions that were imposed on the lender in the UK in 2009, This Is Money reported.
Ex Labour Chancellor Alistair Darling had also been summoned to the court as the sanctions were imposed under him.