A debt that has been stuck since the seventies... Why does Britain refuse to pay it to Iran?

LONDON

- "Give us our money back," a phrase repeated by more than one Iranian official in every meeting with Iranian officials, the last of which was during the meeting that brought together the British and Iranian diplomatic delegations in New York on the sidelines of the United Nations meetings, during which many files were raised, including the necessity of London repaid the debt owed by it to the Iranian treasury.

It is related to an arms deal dating back more than 4 decades, concluded during the reign of the Shah of Iran, before the Islamic Revolution in Iran led to the freezing of this deal, leaving hundreds of millions of dollars in dispute between Tehran and London, and despite the dispute reaching the highest courts in the United Kingdom and in Europe, This dispute has not been resolved.

The biggest arms deal of the 1970s

The Shah of Iran was an admirer of British and American weapons, and in the seventies of the last century, two arms deals, which were the largest at the time, were concluded between the International Military Services (IMS) of the British Ministry of Defense, and what was then known as the Imperial Persian Army.

The deal - which took place in 1976 - stipulates that Iran will obtain 1,500 "Chefton" tanks, which were at the time one of the most advanced tanks in the world, in addition to more than 250 armored vehicles used to withdraw damaged tanks from the battlefield, known as "AVR" (AVR). The deal was worth $800 million, which the Iranian government paid in advance even before acquiring the weapons.

However, the fall of the Shah’s regime led to the obstruction of the deal, after the United Kingdom decided to ban the export of arms to the Islamic Republic, and London had only delivered 185 tanks and armored vehicles, and more than that, the rest was sold to Saddam Hussein for use in the Iran-Iraq war.

What did the European courts say?

The legal battle between London and Tehran began more than 3 decades ago, and in 2001 the Paris-based International Chamber of Commerce announced that Iran had the right to receive the half-billion dollars in funds owed by the British International Military Services Company.

Indeed, the British government agreed to pay the agreed amount to the court in 2002, but an appeal by the United Kingdom to the Supreme Court of the Netherlands led to a reduction of the agreed amount by a few tens of millions of dollars, but it did not achieve the Kingdom what it wanted from a greater reduction of the amount.

Then London justified its delay in paying the amount by saying that the Iranian Ministry of Defense was subject to European Union sanctions.

In 2013, Iranian officials tried to obtain an order to implement the ruling of the International Trade Court, but the British authorities canceled their visas to prevent them from entering the country.

The International Chamber of Commerce announced that Iran is entitled to the remaining funds from the British International Military Services Company (Getty)

What do the British courts say?

Iran is demanding the receipt of about half a billion dollars, in addition to the interest on the amount, and the matter reached the British Supreme Court, which is the highest stage of litigation in the United Kingdom, and its decisions are not subject to appeal.

And last April, the hearing of the two parties was postponed, which is the 11th time - since 2003 - in which the session between the Iranian Foreign Ministry and representatives of the British Ministry of Defense and the British International Military Services Company has been postponed. This issue.

Why was the issue delayed?

Many media reports link the issue of debts owed by London and those detained in Iran with dual nationals (with British citizenship), the most famous of which is the British-Iranian researcher Nazanin Zaghari-Ratcliffe, who is still detained in Iran on charges of espionage.

Although Iran officially denies the existence of any link between the two files, as well as London, many leaks talk about Iran bartering the release of the British researcher, for the release of Iranian funds.

London also does not want to risk taking any step in this regard until after the black and white thread emerged regarding the Iranian-American nuclear negotiations.

Is there an imminent solution to the crisis?

In 2017, the British newspaper The Independent revealed that the government had already decided to pay the amount owed to Iran, before reversing the decision.

According to the proposed formula for repaying the debts, London wants to put this money in a trust account supervised by independent trustees, thus joining the nearly one billion dollars of Iranian assets frozen in Britain pending the lifting of sanctions on Tehran.

It is not yet known what are the reasons that prompt the Supreme Court to postpone the hearings during all these years, and the British side, as well as the Iranian side, refuses to comment on the court's decision.