British judges declare halt of Saudi arms probe 'unlawful' (Roundup)

Apr 10, 2008, 14:38 GMT

London - A British court ruled Thursday that a government-backed decision to drop a corruption inquiry into a multi-billion arms deal with Saudi Arabia in 2006 was unlawful.

The High Court in London said that the Serious Fraud Office (SFO) acted unlawfully when it stopped the investigations into the 1985 Al- Yamamah arms deal totalling 43 billion pounds (85.2 billion dollars).

'No-one, whether within this country or outside, is entitled to interfere with the course of our justice,' the judges ruled.

But the two judges did not specify whether the fraud probe should be reopened, saying they would have to listen to further arguments from all sides concerned.

But anti-arms trade campaigners, who had brought the challenge, hailed the court ruling as a 'landmark victory' and called for the SFO investigations to be reopened 'immediately.'

Leading British defence contractor BAE Systems had been accused of making illegal payments to Saudi officials over the contract, but the firm maintained it acted in accordance with the law.

'The case was between to campaign groups and the director of the SFO. It concerned the legality of a decision made by the director of the SFO. BAE Systems played no part in that decision,' a statement from the arms company said.

BAE has always insisted that the Al-Yamamah deal was signed between the governments of Saudi Arabia and Britain, implying that responsibility for alleged bribery payments also fell to the government.

The SFO, the watchdog for the City, London's financial district, said it was 'carefully' considering the implications of the judgement, but had no further comment to make.

At the time the investigations were halted, the SFO said continuation of the probe would undermine Britain's national security.

It was a view echoed by the then Labour government of Tony Blair, which was widely seen as having ordered the end of the investigations.

Thursday's High Court verdict represents a major victory for campaign groups who had brought the challenge, Corner House and the Campaign Against Arms Trade (CATT).

CATT in particular had argued that the decision was illegal under an international anti-bribery convention.

The Paris-based Organization for Economic Co-Operation and Development (OECD) said last month it was launching its own investigation into the decision to drop the SFO inquiry.

Blair said at the time that the Saudis had privately threatened to suspend anti-terrorism cooperation if the investigations were not stopped. He also argued that British jobs would be at stake.

Saudi Arabia was also reported to have threatened to cancel a further deal with BEA to supply it with Eurofighter Typhoon aircraft and withdraw diplomatic cooperation.

The Al-Yamamah deal, which goes back to the Conservative government of Margaret Thatcher, provided for the supply of Tornado and Hawk jets plus other military equipment.