The Iranian Ministry of Economy has published the details of letters of credit (L/Cs) that Iranian banks allocated over the past few years. The country’s international trade picked up considerable pace when the sanctions against Iran were lifted. According to the ministry’s report, Bank Melli Iran allocated 154 letters of credit worth $42.71 million over a four-year period (2013-16). During 2013-16, Bank Keshavarzi opened 19,253 L/Cs worth over $10.5 billion. It also played an important role in issuing 21 bank guarantees valued at $15 million. Bank Mellat also issued 32 export guarantees worth $15.4 million and four import guarantees worth $13.5 million. Export Development Bank of Iran opened 550 L/Cs and issued more than 1,750 bank guarantees during 2013-15 to emerge as one of the main forces in the Iranian economy.
Iran's Bank Mellat is suing the British government for almost $4 billion in damages after the Supreme Court quashed sanctions imposed against it over alleged links to Tehran's nuclear programme. The lender wants compensation for the "significant pecuniary loss" and substantial reputational damage it sustained as a result of sanctions imposed in 2009, according to a claim filed in London's High Court. It claims the UK government also successfully lobbied other authorities to impose their own sanctions that ultimately caused and continue to cause the loss of profitable business, customers, banking relationships and dealing services.
Iran's Bank Mellat filed an application for a judicial review against the UK Government in the Administrative Court on 16 April 2014. In its final ruling last June, the UK Supreme Court found that by imposing domestic sanctions against Bank Mellat, the UK Government acted both “unlawfully and irrationally”. Following the UK Supreme Court decision, Bank Mellat had asked the UK Government to withdraw its 2010 listing proposal to the EU Council. It was hoped that this may have been sufficient to convince the EU Council to give up on its own sanctions against the bank. However, the UK Government has refused to withdraw the proposal. The UK Government has also now applied for permission to intervene in support of the EU Council’s appeal against the first European Court decision.
The Banking Regulation and Supervision Agency (BDDK) approved expansion requests from Bank Mellat last month in light of the U.S. and the UN Security Council loosening economic sanctions. Afterwards, applications from the Iranian banks Pasargad and Tejarat to set up shop in Turkey were approved by the Ministry of Foreign Affairs. Bank Mellat has operated in Turkey through its three branches in Izmir, Istanbul and Ankara. Turkey and Iran have reportedly come to an agreement allowing an increase in banking transactions between the two countries. Earlier this year, Turkish Prime Minister Recep Tayyip Erdogan made a visit to Iran aimed at strengthening economic ties between the neighboring countries.
Iran's Bank Mellat seeks to file a claim of at least 500 million pounds (USD 820 million) in compensation against the British government for loss of business caused by illegal sanctions on Tehran over its nuclear energy program. It is the first time that an Iranian lawsuit over sanctions has reached the stage of claiming compensation. On June 19, 2013, Britain’s Supreme Court overturned a ruling against Bank Mellat over its alleged links to Tehran's nuclear energy program. The European Union General Court decided in January to quash sanctions imposed against Bank Mellat in July 2010.
The British government is seeking to renew sanctions against Iran's Bank Mellat regardless of a court ruling branding the ban as unlawful. Britain's Treasury is now attempting to intervene in the European Union Council's appeal against a decision by the EU General Court in January to quash sanctions imposed against the Iranian bank. This comes after reports that Bank Mellat intends to make a legal claim of 500 million pounds against the UK government for loss of business caused by US-engineered illegal sanctions on Tehran between 2009 and 2013. Earlier on June, Britain’s Supreme Court also overturned a ruling against Bank Mellat over its alleged links to Tehran's nuclear energy program, saying the British government was wrong to have imposed sanctions on the bank.
Iran's Bank Mellat is claiming GBP500 million ($782 million) from the U.K. Treasury after a London court ruled against a British decision to sanction the bank. In June, the U.K.'s highest court ruled against sanctions that had been imposed on Bank Mellat as a result of its alleged links to Tehran's nuclear program. The London ruling follows a similar decision in favor of Bank Mellat at a European Union court. But it won't lead to an end to restrictions against the bank for now because EU sanctions remain in place on Mellat. The U.K. sanctioned Mellat in 2009, banning its operations in the country and freezing its assets after it was accused of facilitating Iran's nuclear program. The measure was expanded to the rest of the European Union the following year.
Iranian Bank Mellat appealed against a decision upholding measures taken by the Treasury to restrict its access to the UK financial market. The Treasury had directed that all persons operating in the UK financial sector were prohibited from having any commercial dealings with the Appellant or its UK subsidiaries. The Appellant argued the Treasury had failed to give adequate reasons for its decision. The High Court and Court of Appeal both dismissed the appeal, however the Supreme Court allowed it. One of the central issues raised was that the lower courts found that the justification for the order was not a problem specific to the Appellant, but a problem with Iranian banks in general. However, the order made no attempt to impose restrictions on other Iranian banks. In that regard, the measure was arbitrary, irrational and disproportionate. The order was also found to be invalid on various procedural grounds.
After the European Union imposed sanctions on Iran-based Bank Mellat and removed them in January, the EU Council has now launched an appeal against the decision of the court. However, Bank Mellat is at present considering applying to the EU Court to strike out the EU Council’s appeal on the grounds that the appeal was filed too late. According to Sarosh Zaiwalla, senior partner at Zaiwalla & Co, the EU Council appealed the decision due to political pressure from the United States government to reinstate sanctions. He stressed the importance of an independent court system in order to deal with businesses who have disputes criss-crossing legal borders.
Managing-Director of Bank Mellat Ali Divandari announced that his bank has been removed from the European Union's sanctions list. The EU Council had listed Bank Mellat and its then-chairman Dr Divandari in the designated list in July 2010 on the basis that it was a legitimate part of its regime of sanctions designed to stop the Iranian nuclear program. Both the bank and Dr Divandari challenged the sanctions in the European Court which finally declared a ruling in support of Bank Mellat.
The Iranian Bank Mellat plans to sue the European Union governments for damages after a European court annulled sanctions against the company. The reasons for the court's decision are that the EU failed to provide enough evidence that Bank Mellat was linked to Iran's disputed nuclear progamme. However, EU governments may appeal the decision. Bank Mellat now plans to resume trading in Europe although broader European sanctions against Iranian banks could still limit Bank Mellat's ability to function there.
The European Court of Justice annulled the European Union (EU) sanctions imposed against the Iranian Bank Mellat in July 2010. According to the bank's Managing-Director Ali Divandari, the Court also required the EU to cover the costs of legal procedures. Additionally, Bank Mellat will receive all legal expenses as well as compensation from the EU for losses incurred because of these sanctions. Divandari also said vague reasons were used by the EU to impose the sanctions two and a half years ago.
Bank Mellat prooved to have the the biggest increase in profits among all banks active in Turkey over the first six months of the year. It had profits in Turkey of 32.6 million liras ($18.5 million) in the first half, a 217% increase over last year's figure for the same period of 10.3 million and the biggest increase among banks in Turkey.
Fredrik Dahl and Parisa Hafezi reported on 18 February in Forbes about the floatation of a 5 % stake in Bank Mellat, Iran. Market environment was not supportive with a fall of 30 % of share prices since last August.
A Tehran Stock Exchange (TSE) official said investors bought 340 million, or around 52 percent, of the 655 million Bank Mellat shares on offer, and suggested the price had been set too high in view of the difficult market conditions.
Iran's economy is dominated by the state but the government has been seeking to speed up privatisations after the constitution was changed to encourage the sale of assets.