Venezuela May File Appeal Against UK Gold Reserve Freeze Court Order

RIO DE JANEIRO, BRAZIL – The Central Bank of Venezuela (BCV) is entitled to appeal against a British court ruling denying it access to the 31 tons of gold that Venezuela has stored at the Bank of England (BoE).

On July 2nd, the British High Court “unequivocally recognized the opposition leader Juan Guaidó as president,” following the position of the British Foreign Office and denying the government of Nicolás Maduro the right to repatriate BCV’s gold assets. Since late 2018, the Bank of England has refused to return the gold deposited in its vaults, the value of which is estimated at US$1.2 billion (R$6 billion).

BCV’s attorneys announced on Friday that they had secured the appeal, which they welcomed as an important step forward in the case. “It is incredibly rare for a trial judge to appeal his own verdict, and we are pleased that we have been granted a limited appeal,” said Sarosh Zaiwalla, a partner at Zaiwalla & Co law firm, as quoted by Reuters.

The “limited appeal” means that only the part of the judge’s verdict delivered on July 2nd concerning the question of justiciability can be re-examined.

The court of appeals will have to decide whether the judge was allowed to rule that the self-proclamation of the Venezuelan opposition politician Juan Guaidó as “interim president of Venezuela”, which was recognized by the British government, and other of Guaidó’s actions are not “justiciable” in England, meaning that they should not be reviewed even if they were declared illegal by the Venezuelan judiciary.

Zaiwalla expressed his satisfaction with the first step, saying that he would urge the Court of Appeal to accept “a more complete review of the verdict” as he believes there are issues “between law and politics” involved.

During the first trial, Nick Vineall, attorney for BCV’s board of directors, argued that although the London-based government recognizes Guaidó as “constitutional interim president until credible elections are held in 2019,” in practice it maintains “diplomatic relations” with the actual executive branch in Venezuela.

In May, Caracas filed the suit to gain access to the reserves the government plans to sell and transfer the proceeds to the United Nations Development Programme. This is intended to import food, medicines, and medical equipment needed to fight the Covid-19 pandemic.

Although Venezuela is still one of the countries in the region that has so far been least affected by the virus, cases are steadily increasing and the Venezuelan healthcare system, which has been crippled by years of lack of investment and US sanctions, is ill-prepared to contain the pandemic.

Guaido’s legal team has not commented on the appeal. The previously little known opposition deputy proclaimed himself Venezuela’s “interim president” in January 2019 and was recognized by the US and several dozen of its allies.

The government of US President Donald Trump subsequently began blocking Venezuelan national assets abroad, including millions of dollars in bank accounts and Citgo, the US-based subsidiary of the state oil company PDVSA.

Washington also imposed crippling economic sanctions with the aim of overthrowing the Maduro government, including a wide-ranging trade embargo with secondary sanctions against third parties such as the Russian energy company Rosneft and foreign shipping companies.