The Magazine

Of Mullahs and Lawyers

Iranian success in European courtrooms.

Feb 24, 2014, Vol. 19, No. 23 • By ANDREW SOUTHAM and TED R. BROMUND
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The EU’s losing streak could portend wider disaster. Since 9/11, the United States has emphasized using the international financial system to raise the costs that bad actors have to pay to do business. The most significant result of Iran’s European victories is that they threaten to make the EU reluctant to impose sanctions anywhere. And while the United States is indeed better at using its intelligence-gathering to inform its sanctions process, it is too easy to argue that the Europeans merely need a legal system that can make effective use of classified evidence.

It tells you a lot about the supposedly independent Iranian firms that their European victories were hailed in supposedly independent press releases from Fars. In the West, we think of the public and private sectors as separate. The basis of the U.K. Supreme Court’s judgment was that Bank Mellat had not been treated with the fairness owed any complainant in the tradition of English common law.

But believing in the probity of the Iranian banking sector is like relying on the Fars News Agency: It’s not a safe bet. It is not that there are no legitimate businesses in Iran; it is that, under any lawless regime, it is impossible to draw the line with certainty. Courts overstep their boundaries when they fail to give governments discretion to draw that line when matters of national security are involved. Majedi’s call to put energy beyond politics is just another effort to exploit Western confusion about how business works in a totalitarian system.

The irony is that the damage European courts are doing to sanctions only makes them a less attractive alternative to using force. Europe’s judges might remember that the rule of international relations is reciprocity. Until European firms (and Iranian citizens) can go to an Iranian court and receive a fair hearing, Iranian firms are the fruit of a closed and corrupt system, and they should be judged accordingly.

Ted R. Bromund is a senior research fellow in the Heritage Foundation’s Margaret Thatcher Center for Freedom. Andrew Southam is a British writer on judicial cooperation and a former Home Office case officer.

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