Iranian Speaker’s Advisor Asks Britain to Pay Back Long-Overdue Debt

Amir Abdollahian referred to his Sunday meeting with British Ambassador to Tehran Rob Macaire in a tweet, and said, “We had frank and constructive talks.”

He noted the British ambassador’s demand for further negotiations with the Islamic Republic in this regard, and said during the talks, “I emphasized that London would be better off to take action based on its delayed undertakings as negotiations for negotiations is a worn-out and fruitless game”.

Yet, Amir Abdollahian pointed out that Iran and Britain enjoy abundant potentials for cooperation, implying that the problem with regard to the delayed payback of the long-overdue debt is an impediment to the further expansion of ties and cooperation between the two states.

In September, the British government confirmed the country’s debt to the Islamic Republic of Iran over the purchase of Chieftain tank under a deal that had been struck before the victory of the Islamic Revolution.

The Iranian defense ministry in a statement in the same month asked London to pay its debt to Tehran.

The defense ministry said that the authorities in Britain have refused to pay the debt under various pretexts such as unlawful and cruel sanctions, causing damage to their reputation in the international arena.

While the British Defense Secretary acknowledges the Britain’s 40-year debt to Iran to honor international regulations and to ensure Iran’s national rights, London is expected to take practical and immediate steps to make up for the past so that the Iranians’ dissatisfaction with Britain will not continue, it noted.

The debt is based on an independent legal case that has nothing to do with the release of the prisoner and other matters, and the verdicts had been issued years before the case of the imprisoned offenders, the statement added.

With regard to the amount of the debt, the unreal figures published in the media are far from reality, and according to the time of payment, the final figures will be calculated with the corresponding interest, it said.

The debt is related to the purchase contract of tanks in 1971 signed by the British Ministry of Defense and the Pahlavi regime according to which the Britain was supposed to deliver 1,500 tanks and armored vehicles to Iran.

The debt, or court award, originated from the non-delivery of contracts to the Iranian ministry of defense of Chieftain tanks dating back to before 1979.

Britain refused to complete the contract after the Shah was deposed, even though Iran had paid the money fully in advance.

The marathon court battle is meant to enforce an international court order dating back to 2012 awarding Iran £400m over the British government’s non-completion of the contract to provide Iran with Chieftain tanks.

Britain has put nearly £500m into court as a surety for the award, but insists it cannot make the payment, let alone pay any interest accrued since 2008, on the grounds that Iran’s Defense Ministry is a sanctioned entity.

Iran has two major routes left to unlock the cash put into court by Britain. The first is a request to the Treasury’s office of sanctions implementation (OFSI) to accept voluntarily that the £400m can be paid to the Central Bank of Iran and not to Iran’s Defense Ministry. The Central Bank is not an EU-sanctioned entity.

Iran lodged its appeal in writing two years ago, but no ruling has emerged from the OFSI.

Iran is due to seek a British court judgment in a case set for directing Britain to pay the £400m award into the coffers of the Central Bank. Lawyers for the British government in court made clear to Justice Phillips that they will resist any requirement to pay the money to the Central Bank either in cash or kind since the ultimate beneficiary will in effect be the Ministry of Defense.