Zaiwalla acts in landmark Court of Appeal case relating to USD 1.8 billion Central Bank of Venezuela gold reserves

May 25 2023

Zaiwalla and Co has acted on behalf of the Central Bank of Venezuela ("BCV") in a landmark case in the Court of Appeal.

The dispute began in May 2020, with the Zaiwalla team issuing a claim on behalf of the BCV against the Bank of England when it refused to act on the BCV's instructions to transfer €1bn of gold to the United Nations Development Programme to assist in securing humanitarian aid, medicine and equipment necessary to support Venezuela’s response to the Covid-19 pandemic.

The appeal follows a 2022 High Court trial directed by the United Kingdom Supreme Court as to whether the BCV may rely on certain judgments of the Venezuelan Supreme Tribunal ("STJ") of Justice invalidating purported decrees by Juan Guaidó (formerly recognised by the UK Government as an "interim President" of Venezuela) which had appointed a so-called "ad hoc Board of the BCV". The UK Supreme Court earlier held those decrees to be "Acts of State" that could not be challenged in the English Court given the UK Government's recognition of Mr Guaidó. However, as an exception to this, the Court may take into account the illegality of the decrees pursuant to STJ judgements, if  capable of being recognised in this jurisdiction under English private international law rules.

This unprecedented case, about who ultimately will have authority to deal with the 32 tons of Venezuelan sovereign gold in the Bank of England, has seen further novel developments since the UK Government's decision, in the intervening period between the trial and the appeal, to formally withdraw its recognition of Mr Guaidó.  The effect of this significant development is one of the several issues argued this week in the Court of Appeal.

The appeal was heard from 23 - 24 May 2023.

Judgment is currently reserved.

This case has been covered in MSN, hereInvesting.comhere and here, and in Yahoo! Finance, here.

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