Official confirms talks with UK over frozen talks over frozen

Iran and Britain are discussing the possible release of about £400 million (Dh1.9 billion) held by London since the 1979 Islamic revolution, an Iranian official acknowledged yesterday.

Britain and Iran denied any link between the possible money transfer and the detention of Nazanin Zaghari-Ratcliffe, a British-Iranian woman who is serving a five-year prison sentence for allegedly planning the “soft toppling” of Iran’s government while travelling with her young daughter.

However, a similar US transfer to Iran happened at the same time American prisoners were released last year.

British foreign minister Boris Johnson has faced enormous criticism at home over his handling of Ms Zaghari-Ratcliffe’s case. Iranian media have speculated that he may visit Iran soon.

Iranian foreign ministry spokesman Bahram Ghasemi was quoted by the semi-official Isna news agency as saying that the £400m held by London is a payment Shah Mohammad Reza Pahlavi made for Chieftain tanks that were never delivered. The shah abandoned the throne in 1979 and the Islamic revolution soon installed the clerically overseen system that endures today.

Sanctions between the countries have stopped the money being returned.

Mr Ghasemi said Tehran has pursued the refund of the money through long and broad talks with Britain for some time. He denied any connection between the payment and Ms Zaghari-Ratcliffe’s case.

“The case of Ms Zaghari-Ratcliffe and paying debt are two separate issues and there is no link between them,” Mr Ghasemi said.

He said that she received her prison sentence after the “necessary legal procedure”.

London’s Daily Telegraph reported yesterday that the money might be part of a bargain to free Ms Zaghari-Ratcliffe. It described the payment as a goodwill gesture between Britain and Iran and said authorities in London continued to consult with experts over whether the payment could be made under current US and UN sanctions.

But the foreign office said it was “wrong to link a completely separate debt issue with any other aspect of our bilateral relationship with Iran”.

“This is a longstanding case and relates to contracts signed over 40 years ago with the pre-revolution Iranian regime,” it said.