MercoPress. South Atlantic News Agency

UK Court ruling to decide on Venezuelan gold's fate

London recognizes Guaido as President but has an active embassy in Caracas handling affairs with Maduro's regime

The UK's Supreme Court is expected to rule Monday on the fate of 31 tons of Venezuelan gold which is currently in the hands of the Bank of England. The Venezuelan central bank turned to the British justice system in 2020 to resolve the issue.

The judicial decision is to determine whether the gold will be handed over to the Government of President Nicolas Maduro or to Juan Guaido, who claims to have been appointed acting President by the National Assembly following fraudulent elections on which Maduro bases his authority.

Maduro was re-elected in May 2018, but Guaido, Speaker of the National Assembly of Venezuela, claims that the election was flawed and that he is the legitimate leader. London recognizes Guaido as interim president.

Both parties have created management committees of the Central Bank of Venezuela (BCV), “which have given divergent instructions on the country's international reserves” of gold, of which the Bank of England holds around $1 billion worth, the Supreme Court said in a statement.

The high court in London initially ruled in favour of Guaido, but a Court of Appeals endorsed Maduro's stance. Guaido is now challenging that decision in the Supreme Court, Britain's highest court.

The judges have to decide whether the British government has recognized Guaido as head of state of Venezuela and, if so, “whether any challenge to the validity of Mr Guaido's appointments to the Board of the Central Bank of Venezuela is justiciable in an English court.”

Maduro wants to recover the gold, but access has so far been denied because he is not seen as Venezuela's legitimate head of state. Around 50 countries, including the United States, accept Guaido's claim and do not recognize Maduro's re-election in 2018.

The Supreme Court heard three days of arguments in July, and is due to give its final decision Monday. Maduro's lawyers argue that the UK, in reality, recognises their client is president, notably through diplomatic relations and insist that gold could help finance Venezuela's fight against COVID-19. Guaido says the money would instead be used to repress the people or would end up in the pockets of a “kleptocratic” regime.

London has reiterated its support for Guaido, who holds no power in the country, but in order to keep channels open with Caracas, the UK also maintains its embassy there with a reduced diplomatic presence. The Court of Appeal was more convinced by the latter argument when it ruled in October 2020, saying that a government statement was less important that the reality of its day-to-day dealings with the Maduro administration.

Should the Supreme Court rule in favor of Guaido, it would set a precedent that he would use to try and recover other Venezuelan assets in various European banks. The US has already entrusted management of the oil-rich country's assets to Guaido.