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MARCH 2021

Venezuelan Government Wins Court Case Over Gold Deposits In The UK


Venezuelan Government Wins Court Case Over Gold Deposits In The UK

Venezuela has been trying to repatriate its gold stored with the Bank of England since 2018

The Venezuelan government won a rare legal victory on Monday in its battle to regain access to gold stored in the Bank of England (BoE).

The English Court of Appeal ruled in favour of the Venezuelan Central Bank (BCV) concerning access to over 31 tons of gold stored in London, overruling a previous High Court decision in July. The BoE has refused to repatriate the Venezuelan gold deposits since late 2018.

In the earlier decision, Judge Nigel Teare ruled against a Venezuelan legal petition to obtain access to the reserves. Teare claimed that the UK Foreign Office had “unequivocally” recognized Juan Guaido as “interim president,” and thus under the “one voice” doctrine the judiciary was bound to the government’s position.

Monday’s decision by Lord Justices Lewison, Males and Phillips called on the UK government to clarify its “recognition” of Guaido.

In this respect it will be necessary to determine whether:

(1) HMG [Her Majesty’s government] recognises Mr Guaido as President of Venezuela for all purposes and therefore does not recognise Mr Maduro as President for any purpose; or

(2) HMG recognises Mr Guaido as entitled to be the President of Venezuela and thus entitled to exercise all the powers of the President but also recognises Mr Maduro as the person who does in fact exercise some or all of the powers of the President of Venezuela.

However, the court stopped short of ruling on the BCV attorneys’ claim that the UK government’s recognition of Guaido violated international law.

In a statement, the BCV welcomed the Appeal Court’s decision.

“The Venezuelan Central Bank will continue carrying out all actions necessary to protect its sovereign international reserves,” the statement read. The BCV further stated that the reserves, valued at $1.8 billion at current gold prices, will be sold and the funds channelled through the United Nations Development Program (UNDP) to boost the country’s Covid-19 response.

Sarosh Zaiwalla, attorney at the Zaiwalla and Co. law firm representing the BCV, also commended the decision as positive for international law, arguing that Guaido is a “virtual prime minister with no real power inside the country.” He had previously warned that a refusal to grant the Venezuelan government control over the deposit would present “a threat to the Bank of England’s reputation abroad as a safe repository for sovereign assets.”

Opposition deputy Juan Guaido proclaimed himself “interim president” in January 2019 and was immediately recognized by the US, the UK and allied countries. In the months that followed, the US and the UK froze most of the assets of the Venezuelan government in those countries, including its US-based oil subsidiary CITGO.

However, despite thte legal victory, the Venezuelan government is still unable to repatriate the gold. In a statement, the Venezuelan opposition personality’s office in the UK noted that the ruling did not change the UK’s official position, stating that the decision over control of the gold would now return to a commercial court. LINK




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