Blackstone leads fight against Govt’s role in dropped BAE case

Blackstone Chambers is to launch the first legal action against the Serious Fraud Office (SFO), the Attorney General and Prime Minister Tony Blair over the decision to drop an investigation into BAE Systems’ involvement with a Saudi Arabian defence contract.

As first reported on (18 December), a heavyweight team from Blackstone, which includes Dinah Rose QC and top judicial review silk David Pannick, has applied for judicial review with Leigh Day & Co partner Richard Stein.

Stein has been instructed by the Campaign Against the Arms Trade (CAAT) and environmental and social justice movement The Corner House to launch the claim, which has three main aspects.

The claimants allege that the SFO’s decision to drop the probe into BAE was unlawful because it took into account international relations with Saudi Arabia, which is in breach of the Organisation for Economic Co-operation and Development (OECD) Anti-Bribery Convention.

They also claim that the Prime Minister’s advice to the SFO was unlawful for the same reason and that it amounted to a direction rather than pure advice.

The firm gave the defendants until 2 January to respond to its letter before claim. However, the deadline has been extended to 19 January following a request by the Treasury Solicitor.

SFO director Robert Wardle announced that the two-year, £2m investigation into allegations that BAE bribed Saudi officials to win the Al Yamamah defence contract was being dropped on 14 December last year (2006).

The decision followed advice given to the SFO by the Attorney General Lord Goldsmith and the Prime Minister. BAE was advised by Allen & Overy.

CAAT spokesman Symon Hill said: “We’re looking for a declaration that the Government acted illegally in curtailing the investigation into BAE Systems. We’re looking to ensure that BAE Systems cannot be placed above the law.”

Article 5 of the OECD Anti-Bribery Convention states that “investigation and prosecution of the bribery of a foreign public official… shall not be influenced by considerations of national economic interest [or] the potential effect upon relations with another state”.

In June 2005 the OECD evaluated the UK’s implementation of the convention and expressed concern at the potential for ‘national interest’ considerations to influence decisions on investigations.

The Attorney General assured it that “none of the considerations prohibited by Article 5 would be taken into account as public interest factors not to prosecute”.