* Iran bank says will seek damages for loss of business
* Case is rare loss for the EU
* Multiple sanction cases are ongoing
LONDON/BRUSSELS, Jan 30 Iran's Bank Mellat plans
to sue European Union governments for damages after a European
court ruled to annul sanctions against the company, lawyers said
Europe's General Court said on Tuesday the EU had failed to
provide enough evidence that Bank Mellat was linked to Iran's
disputed nuclear progamme when the bloc targeted it with
sanctions in July 2010, and ordered the measures annulled.
EU governments may appeal the decision, and diplomats said
broader European sanctions against Iranian banks could still
limit Bank Mellat's ability to function in Europe.
But lawyers for the bank, the biggest private sector lender
in Iran, said the ruling meant it could resume trading in
Bank Mellat "will now be able to commence trading
internationally and try and draw back the losses incurred over
the last three years since the sanctions were imposed," law firm
Zaiwalla & Co said in a statement.
"Furthermore, the bank will now look to claim damages from
the EU Council."
Sarosh Zaiwalla, who represented Bank Mellat, said being put
on the sanctions list resulted in a freeze on all the bank's
assets in the EU and its international trade was effectively
suspended for three years.
The EU argued in 2010, when it decided to impose the
sanctions, that the bank facilitated Tehran's disputed nuclear
programme and provided financial services to companies or
institutions targeted by international sanctions.
Tehran says its nuclear work has only peaceful purposes but
the United Nations Security Council has ordered it to suspend
uranium enrichment, concerned that its ultimate goal is to
provide Iran with an atomic bomb.
The case is one of a handful involving Iranian companies
that the EU has lost in the court in the last year and will add
to concerns among many European diplomats that legal rulings
could undermine the bloc's sanctions policy against Iran.
Iranian companies and individuals have nearly 50 cases
outstanding in the court.
Beside failing to prove that the bank knowingly committed
wrongdoing, the court said that the Council of the European
Union failed to show the bank reasons for its listing, hampering
its defence, and had erroneously claimed it was a state-owned
bank in its original sanction decision.
An EU diplomat said the Council provided evidence to the
court to avoid compromising the sources of its information.
The General Court also ordered the Council to pay Bank
Mellat's legal costs.
Bank Mellat was formed through the merger of 10 banks in
1980 and boasts 1,800 branches in Iran as well as branches in
Turkey, South Korea, London and Dubai. It has also appealed to
the UK Supreme Court to overturn a ban on its operations.
That case is due to be heard in March.
The EU side has two months to appeal Tuesday's ruling. There
was no immediate comment from the Commission or Council.
(Reporting by Steve Slater in London and Ethan Bilby in
Brussels; Editing by Tom Pfeiffer)