Frances Ball 19 Jun 2019 12:46pm

UK government settles lawsuit with Iran’s Bank Mellat

The British government has settled out of court over a damages claim brought by Iran’s largest private bank.

The Iranian government holds 20% of Bank Mellat, with the rest privately owned. In a victory for Tehran, the UK has now settled for an undisclosed sum, bringing an end to a lawsuit that has lasted for 10 years.

The UK Treasury imposed sanctions on Bank Mellat for its alleged involvement in financing firms related to Iran’s nuclear programme. The bank has always denied those allegations.

Six years ago, the UK supreme court ruled that the sanctions were unlawful, “arbitrary and irrational”, and “disproportionate”.

The bank argued that the sanctions had damaged its reputation, causing significant losses.

The Treasury has released a short statement, announcing that, “Bank Mellat’s claims have been concluded on terms confidential to the parties.”