The Anglo-Iranian Oil Company had been drilling for oil in Iran since 1913. In 1908, a British venture capitalist discovered oil in southern Iran. Throughout the early 20th century, the ruling Pahlavi government made various concessions with the British that gave the UK control over certain elements in the Iranian economy. The 1901 D'Arcy Concession being the earliest of these oil concessions. In 1933, another concession was made which extended the terms of the D'Arcy Concession by 32 years, from 1961 until 1993 and altered how revenue was allocated. The concession would later stoke discontent within Iran. When Mohammad Mosaddeq became Iran's prime minister in 1951, his National Front party sought to nationalize Iran's oil industry and succeeded in doing so. This then led to the case of United Kingdom v. Iran being taken up by the International Court of Justice.
Facts of the Case
The UK alleged that the Iranian oil nationalization act of 1951 was counter to a convention agreed upon by the Anglo-Persian Oil Company and Iran in 1933. This granted the Anglo-Iranian Oil Company a 60-year license to mine oil in of Iran in return for a percentage royalty. On 26 May 1951, the UK took Iran to the ICJ, demanding that the 1933 agreement be upheld and that Iran pay damages and compensation for disrupting the UK-incorporated company's profits. The ICJ quickly issued a temporary ruling, proposing to supervise the operations of the oil company by a board of 5 — two from each state and a fifth from a third — until the legal question had been resolved. The UK accepted, whereas Iran declined as a matter of principle, arguing that the ICJ had no jurisdiction over this case. The UK lodged a formal complaint to the Security Council, claiming that Iran jeopardized world peace by rejecting the temporary ruling out of hand, but the UK was unable to gain enough votes.
People involved
Sitting judges
Representatives
Name
Role
Hossein Navab
Agent
Mohammad Mosaddegh
Agent
Nasrollah Entezam
Advocate
Henri Rolin
Advocate
Allahyar Saleh
Counsel
Ali Shayegan
Counsel
Mozaffar Baghai
Counsel
Kazem Hassibi
Counsel
Mohamad Hossein Aliabadi
Counsel
Marcel Sluszny
Counsel
Name
Role
Eric Beckett
Agent
Lionel Heald
Counsel
Humphrey Waldock
Counsel
H. A. P. Fisher
Counsel
D. H. N. Johnson
Counsel
A. D. M. Ross
Expert Adviser
A. K. Rothnie
Expert Adviser
Judgment
On 22 July 1952, the ICJ decided that because Iran had conceded to ICJ jurisdiction only in cases involving treaties agreed upon after 1932 and as the only treaty cited by the UK after that date was between Iran and a foreign company, it had no jurisdiction in this matter.
Aftermath
The outcome of this case may have left the UK with little legal recourse to reclaim control of Iran's oil fields. The United States and UK then began an oil boycott against Iran as a means of isolating it economically. Following this, the UK's intelligence service, MI6 requested assistance from the United States' newly-formed Central Intelligence Agency to overthrow Mosaddeq. What followed was a series of disruptions and eventually Mosaddeq was overthrown in a coup in August 1953. Mohammad Reza Shah returned to Iran and solidified his authority backed by the U.S.
Hossein Navab
Henri Rolin
Eric Beckett