Venezuela’s $2 Billion Gold Case in UK Sent Back to Lower Court

(Bloomberg) -- President Nicolas Maduro’s quest to gain control of roughly $2 billion in Venezuelan gold held in the UK suffered a setback Friday when the English Court of Appeal dismissed his administration’s appeal and sent it back to the Commercial Court.

The Court of Appeal dismissed an appeal introduced by the Maduro government and said the Commercial Court needed to determine the future course of the case, on the grounds that opposition leader Juan Guaidó is no longer recognized by the UK government as the president of Venezuela, according to the decision. 

The gold, which is stored in the vaults of the Bank of England, represents a significant chunk of Venezuela’s $5.2 billion in international reserves, excluding special drawing rights with the International Monetary Fund which the country can’t currently access. 

Maduro and Guaidó have been fighting in court to gain control of the gold. The legal battle grew complicated after Guaidó, who in 2019 was recognized as Venezuela’s legitimate president by dozens of governments worldwide, was removed from his post by allies in January, creating uncertainty over who represents the country’s interests.

Maduro received permission in September to appeal a London judge’s ruling holding that decisions by Venezuela’s Supreme Court, which backed the government-controlled central bank board’s rights to access the gold, could not be recognized. The change to Guaidó’s recognition doesn’t alter that decision, the appeals court said Friday.

“The clear next step is for the Commercial Court to consider the impact of these changed circumstances including Her Majesty’s Government de-recognition of Mr. Guaido following the recent political events in Venezuela,” said Sarosh Zaiwalla, Senior Partner at Zaiwalla & Co., who is representing Maduro’s appointed central bank board in the case. 

The situation calls for an enquiry to establish who, in the absence of a formal recognition from the UK government, is to be regarded as governing Venezuela, he added.

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