The largest private bank in Iran, Bank Mellat, has been successful in its challenge against the Iranian sanctions regime, defeating both the UK Supreme Court and EU Court respectively of their unlawful sanctions on the Bank.

It is a high profile legal case and the first major legal success for an Iranian corporation challenging the Iran sanctions regime, paving the way for others to do the same.

Sanctions against Iran have been in place since the Iranian Revolution of 1979, severely damaging the economy. On 16 January 2016, the UN lifted sanctions against Iran following an agreement reached in April of last year between the P5+1 and Iran.

On 18 February, the European Court of Justice upheld the decision that Bank Mellat had been unfairly sanctioned, citing a lack of evidence to back the contention that Bank Mellat was involved in Iran’s nuclear and ballistic missile programs. These charges were based on the fact the Iranian bank was the parent company of another sanctioned entity called First East Export. The Court of Justice confirmed the annulment of the fund-freezing measures in place against Bank Mellat since 2010.

Consequently, the Iranian bank is claiming $4bn in damages from HM Treasury and the UK Supreme Court.

The removal of sanctions has allowed Iran to access frozen assets abroad, estimated by US-based Moody’s Investors Services to total $150bn, and enables the use of global banking systems such as Swift, in order to trade with the rest of the world. Iran was reconnected to the Swift banking system on 17 February.