Iran to challenge US sanctions at top UN court

TEHRAN - Iran's legal challenge against renewed sanctions by the United States goes before the UN's top court Monday, as Tehran seeks to avert painful punitive measures that could hurt its still fragile economy.

Tehran filed a suit against US President Donald Trump's decision to reimpose economic sanctions at the Hague-based International Court of Justice last month.

After unilaterally pulling out of a historic hard-won deal aimed at curbing Iran's nuclear programme in May, Trump slapped a first round of sanctions on the country in early August.

And a second round is set to come into effect in early November, this time blocking Iran's valuable oil and energy sales.

But Tehran argues that Washington is "besieging" its economy, has no right to reinstate such measures and is calling on the ICJ to order the US to "immediately suspend" them.

It is also demanding compensation.

The ICJ is expected to take a couple of months to decide whether to grant Tehran's request for a provisional ruling, while a final decision in the case could actually take years.

International sanctions against Iran were lifted in 2015 when it a struck a landmark accord with the US, Britain, China, France, Germany, Russia, agreeing to rein its nuclear ambitions.

But Trump described it as a "horrible one-sided deal (that) failed to achieve the fundamental objective of blocking all paths to an Iranian nuclear bomb."

And even though all of the other parties pleaded with him not to abandon the pact, Trump pulled out and announced he would reinstate sanctions with the support of Iran's regional rivals Saudi Arabia and Israel, who had argued that the deal did little to curb Tehran's nuclear aspirations and instead was encouraging Iran's interference in neighbouring states.

Does Tehran have a case?

Tehran argues that the move violates a little-known Treaty of Amity and Economic Relations signed by the two countries in 1955, which provides for "friendly relations" between the two countries, encourages mutual trade and investment and regulates consular relations. 

However, there has been no formal diplomatic ties between Tehran and Washington since the regime of the US-backed Shah (raised to power after a CIA-backed coup) was deposed by Iran's Islamic revolution in 1979.

Iran says that the new sanctions are already hurting its economy. And its currency, the rial, has lost around half its value since April.

A raft of international companies -- including France's Total, Peugeot and Renault, and Germany's Siemens and Daimler -- have already suspended operations in Iran in the wake of the US move.

Washington "is besieging Iran economically, with all the dramatic consequences that a siege implies for the besieged population," Tehran said in court papers.

Iran "requests that, pending final judgement in the case, the Court indicate... that the USA shall immediately take all measures at its disposal to ensure the suspension of the implementation of all the May 8 sanctions," it said.

Eric De Brabandere, professor of international dispute settlement at Leiden University in the Netherlands, said that the support of many European states for the nuclear deal meant that "Iran's position is strengthened."

According to De Brabandere, the case has two main elements.

Firstly, "Iran genuinely considers the re-imposition of sanctions a violation of international law."

Secondly, "Iran has the support of many European states on the question of sanctions, politically speaking," De Brabandere argued.

And the publicity generated by Iran filing a lawsuit at the ICJ could work in Iran's favour, the expert suggested.

"One of the objectives is to publicly denounce the acts of the United States," De Brabandere said.

'Malign' activities

For its part, the US will likely "argue that the court has no jurisdiction, as they did in a separate case launched against the US two years ago," said De Brabandere.

Washington could invoke two arguments.

One is that the 1955 treaty is no longer in force, because it is a "treaty of friendship" between two nations which have been adversaries for the last four decades.

Secondly, US representatives could say that the dispute was "not about the treaty, but about sanctions and Iran's alleged terrorist activities," De Brabandere said.

"The US is likely to argue that the dispute is about something much broader than a treaty," for instance Tehran's nuclear ambitions, the expert said.

Furthermore, there is a clause in the 1955 treaty which allows the states to take "any measures to protect essential security interests."

In his executive order, Trump argued that the sanctions would turn up the financial pressure on Tehran to come to a "comprehensive and lasting solution" regarding the activities that the international community regarded as "malign", such as its "ballistic missile programme and its support for terrorism."

But earlier this month, Iran's supreme leader Ayatollah Ali Khamenei appeared to rule out any immediate prospect of talks, saying "there will neither be war, nor negotiations," with the US.

Meanwhile, both the US and close ally Israel have called on European countries to do more to pressure Iran.

A separate 2016 complaint lodged by Iran against the US for freezing around $2 billion of its assets abroad is due to begin in October, when the United States will argue the ICJ has no authority to hear the case.