ICJ denies Iran release of US frozen central bank funds

Europe 1 with AFP 18:58 p.m., March 30, 2023

The UN's top court on Thursday rejected Iran's request to release nearly $2 billion in assets belonging to its central bank, frozen by the United States in retaliation for alleged terror attacks. The International Court of Justice (ICJ), which sits in The Hague, ruled that it had no jurisdiction over this request but also ruled that Washington had "violated" the rights of Iranian companies and nationals whose assets were also frozen.

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Funds seized to compensate Americans victims of terrorist attacks

The US justice system said in 2016 that the seized funds should be used to compensate Americans who were victims, according to it, of terrorist attacks fomented or supported by the Islamic Republic. Washington referred in particular to the death of 241 American soldiers killed on October 23, 1983 in two suicide bombings that hit the American and French contingents of the Multinational Security Force in Beirut. Tehran denies any responsibility for these actions and maintains that the US seizure of its financial assets is illegal.

"The court, by ten votes to five, upholds the objection of lack of jurisdiction raised by the United States of America," ICJ Judge Kirill Gevorgian said. Iranian and U.S. delegations declined to comment on the verdict after the hearing before the ICJ, which was set up after World War II to adjudicate disputes between UN member states.

Crucial funds for Tehran

Iran initiated the procedure in 2016, saying the blocked funds were crucial for the country, which is facing economic difficulties after sanctions imposed by the West over its nuclear program. In its petition, Iran invoked a bilateral treaty signed between Tehran and Washington in 1955, which predates the 1979 Islamic Revolution that overthrew the pro-US shah and led to the end of diplomatic relations between the two countries. Shortly after its withdrawal in 2018 from the Iran nuclear deal, Washington announced that it was officially ending the 1955 treaty.

Iran was seeking the return of $1.75 billion belonging to Iran's Central Bank, or Bank Markazi, plus interest, plus assets belonging to Iranian nationals and companies. But the ICJ ruled that Iran's central bank did not count as a company, contrary to Tehran's claims, and that only companies were protected under the treaty.

24 months to reach an agreement

The court gave the two countries 24 months to agree on compensation for affected companies and individuals. Its judgments are binding and without appeal, but the court has no way of enforcing them. Countries can, however, turn to the UN Security Council if another state does not obey a decision. The ruling comes amid fresh tensions between the two countries after recent U.S. airstrikes targeting pro-Iranian groups in Syria and Tehran's support for the Russian invasion of Ukraine.

Iran has called US airstrikes targeting pro-Iranian groups in Syria a "terrorist attack" in response to a drone strike that killed at least 19 people, mostly Syrians, according to the Syrian Observatory for Human Rights. Washington said it carried out the strikes after an "Iranian-origin" drone attack on a US-led international coalition base in northeastern Syria, which killed a US contractor.