Halkbank's Battle at the U.S. Supreme Court: A Clash Over Sovereign Immunity

Halkbank is seeking to overturn a ruling permitting its prosecution for allegedly aiding Iran in circumventing U.S. sanctions. The bank claims 'absolute immunity' under common law, implicating broader concerns about sovereign immunities. This case strains U.S.-Turkey relations and awaits potential review by the Supreme Court.

Turkey's state-owned Halkbank has made a plea to the U.S. Supreme Court to dismiss a lower court's decision that exposes it to criminal charges for allegedly assisting Iran in bypassing U.S. sanctions.

The bank's petition, available on the Supreme Court's website, asserts 'absolute immunity' as a sovereign instrumentality, challenging the precedent set by a federal appeals court in Manhattan that permitted its prosecution. Halkbank denies the charges of fraud, money laundering, and conspiracy linked to facilitated transactions through Iran, Turkey, and the UAE.

The case underscores a diplomatic tension between the U.S. and Turkey, with President Erdogan criticizing the proceedings. Despite a 2023 Supreme Court decision rejecting immunity under the Foreign Sovereign Immunities Act, the debate continues over common law protection. A decision on whether the court will hear the appeal is expected in their October term.

(With inputs from agencies.)