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Europe's top court strikes down sanctions on Iranian company

John O'Donnell
Thursday, 28 Nov 2013 | 8:53 AM ET

* Ruling may make it harder to impose sanctions

* Decision follows barrage of legal challenges from Iran

* Court demands proof of nuclear link to justify sanction

BRUSSELS, Nov 28 (Reuters) - Europe's highest court struck down EU sanctions against an Iranian power company on Thursday, the latest legal ruling against measures that the European Union has imposed over Iran's nuclear programme.

While sanctions are set to be relaxed under a deal last week in which Tehran promised to limit parts of its nuclear work, the EU is still keen to have the option to impose trade restrictions in the future should Iran waver.

That could be complicated by this decision, the first such judgement by Europe's top court, and previous EU legal rulings.

A lower EU court had already overturned several sanctions due to the refusal by EU states to disclose evidence linking their targets to Iran's nuclear work. The governments argue that doing so may expose confidential intelligence.

That position was rejected once again on Thursday, by five judges at the European Court of Justice who said that if a case is to be made, evidence must be presented.

The ruling overturned sanctions against Fulmen, a company that the U.S. government has named as involved in building a secret uranium enrichment plant in Iran, as well as its majority shareholder, Fereydoun Mahmoudian.

It was one of more than 30 legal challenges from Iran's political elite and industry who have seen assets frozen, visa applications refused and business ties with Europe severed.

Since the previous court rulings, the European Union has reissued sanctions on several Iranian companies using non-confidential evidence, including on Islamic Republic of Iran Shipping Lines.

Last Sunday's agreement between Iran and the United States, France, Germany, Britain, China and Russia offers Tehran limited relief from sanctions in exchange for halting its most sensitive nuclear work which the West fears is aimed at developing nuclear weapons.

(Editing by Robin Pomeroy)