TEHRAN: Israel has refused a Swiss court order to pay compensation to Iran in an arbitration case, it emerged Wednesday. The court ordered the Eilat Ashkelon Pipeline Company to transfer $1.1 billion to the Islamic Republic in a ruling over oil supply agreements dating back to before Tehran’s 1979 Islamic Revolution.
“Under the laws of trade we cannot transfer funds to an enemy country,” a statement issued by the Finance Minister said Wednesday.
A judicial official said that Israeli firm registered in Panama, was ordered earlier this month to pay the compensation to the National Iranian Oil Company, in a legal tussle dating back to 1989.
In 1968, the Eilat Ashkelon Pipeline Company was established as a joint Israeli-Iranian venture to carry Asian oil from Eilat to Europe via a network of pipelines that reach from Eilat to Ashkelon and up the length of Israel’s coast to Haifa.
According to the EAPC website, the company currently operates 750 kilometers of pipeline in Israel.
As relations between Israel and Iran were severed in the wake of the Islamic Revolution, the Tehran partner dropped out of the arrangement and the company is now managed only by the Israeli side.
However, for years Iran has continued to demand that Israel pay back debts acquired when the arrangement was still valid.
