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BAE probe reprieve

LONDON: In what’s turning out to be a seemingly unending legal wrangle, the British government was on Thursday granted leave to appeal against a recent High Court ruling that sharply criticised its decision to drop a corruption investigation into a multi-billion pound defence deal with Saudi Arabia.

Earlier this month, the High Court held that the government acted unlawfully in calling off the probe on grounds of national security. The judges called the government’s action an “abject surrender” to pressure from the Saudi government, which had threatened to stop sharing terror-related intelligence and scrap a pending arms contract if the inquiry went ahead. The ruling, on a petition by pressure groups, Corner House Research and the Campaign Against the Arms Trade (CAAT), prompted calls for the inquiry to be reopened. But the government argued that such a course would undermine national security, and on Thursday it won the right to take its case to the House of Lords, the highest court of appeal.

The case relates to allegations that the BAE Systems — Britain’s biggest arms supplier — paid millions of pounds in secret commissions to obtain a £43-billion arms contract from Saudi Arabia in 1985. It was alleged that BAE paid up to £1 billion to Prince Bandar bin Sultan, a former Saudi Ambassador to the U.S., for his role in negotiating the contract, known as the Yamamah Deal signed by the then Tory Prime Minister Margaret Thatcher.

The Serious Fraud Office was investigating the allegations, but in December 2006, the former Prime Minister, Tony Blair, sparked a controversy when he intervened to halt the probe, claiming that it would have a “devastating” effect on Britain’s relations with Saudi Arabia, a key ally in the “war” against terrorism. Prince Bandar has denied receiving any “improper” payments. BAE also denied any wrong-doing.

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