An international arbitration court in the Hague ruled that the British government must pay back $650 million to Iran, after a huge arms deal from the 1970s was cancelled, British news sources said Sunday.
According to the reports, the UK government approved the court's ruling and announced that the funds are available.
Weapons ordered by the Iranian Shah between 1971 and 1976 lie behind the affair. These deals included 1,500 Chieftain tanks and 250 military vehicles, at a cost of $650 million.
The deal was cancelled due to the Islamic revolution in 1979, and as a result Iran decided to claim a refund on the deposit. According to the UK newspaper the Independent, Britain has accepted the main claims after a protracted legal case, and will have to part with some £400 million.
The newspaper said that the agreement between the Iranian Ministry of Defense and IMS, the company through which the UK's Ministry of Defense made the original deal with the Shah's regime, will be finalized in the coming weeks.