HM Treasury v. Ahmed (2010) – Why such a good example?

The UK Supreme Court was established under the Constitutional Reform Act (2005). It replaced the Appellate Committee of the House of Lords as the highest court in the UK. However, it only began operating in 2009, with its first case adjudicated on in October 2009.

HM Treasury v Ahmed was a major early case for the UKSC

In January 2010 the Supreme Court heard a very important case – that of HM Treasury v. Ahmed. This case was significant not just for its ruling, but for the reaction of Parliament following the ruling.

Background to the Case

The case concerned three brothers who had been under investigation by the police for suspected links to terrorist organisations. Importantly, none had been charged with any terrorism related offence. However, on the 2nd of August 2007, they were informed that HM Treasury had reasonable grounds for suspecting that they had links to terrorist organisations. The Treasury informed them that they had been designated under a United Nations Terrorism Order. The Treasury alleged that they had intelligence to suggest that all three had been involved in fund-raising for Al-Qaeda operations in Pakistan.

Al-Qaeda is an Islamist terror organisation that was led by Osama Bin Laden until his death in 2011.

All three denied any associations with Al-Qaeda. However, the Treasury informed the three individuals that they were subject to an ‘asset freeze’, meaning that their monetary assets could not be moved abroad. The reason for doing this was to stop them from continuing, in the Treasury’s view, of funding terrorist acts.

An important aspect of the case was regarding one of the fundamental principles of the rule of law – that of innocence until proven guilty. If any of the three complainants had provable grounds that they were funding terrorism, it stands to reason that they would have been charged under Anti-Terrorism legislation, yet not of them had been charged. However, despite not reaching the threshold for charging, the Treasury had taken the decision to freeze their assets.

The court therefore had to consider whether the balance between individual rights to privacy and the the presumption of innocence with the collective rights of society to protect against the advancement of terrorism.


The Supreme Court Justices in the case ruled that HM Treasury had acted Ultra Vires by imposing the Asset-Freezing order and ruled that it should be overturned by 6-1. In particular, the justices noted that it was unreasonable that the Asset-Freezing order could not be contested in court (as a criminal charge would be).

Reaction of the Government and its significance

The Government was extremely disappointed with the verdict of the Supreme Court. As the UK has no codified constitution the Supreme Court cannot rule an action unconstitutional. Instead, they can only rule that it is ultra vires, meaning that the Government has gone beyond the powers provided for it by Parliament. In Britain, parliament is sovereign, meaning it is the supreme legal authority.

Consequently, the Government, led by Prime Minister Gordon Brown, quickly formulated legislation to deal with this issue in the Terrorist Asset-Freezing Act (2010). This bill proposed to give the government power to freeze assets of suspected terror suspects. The bill went through all its legislative stages within just four days:

The bill passed the House of Commons by 376-56 votes and without a vote (‘nodded through’) in the Lords, clearly indicating that Parliament disagreed with the verdict by the Supreme Court.

This case remains one of the best examples of judicial review, but, even more importantly, an excellent example of parliamentary sovereignty.

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