THE Serious Fraud Office is to appeal against a court ruling that it acted unlawfully by dropping an investigation into deals between BAE and Saudi Arabia, it said today.

The SFO said it will tomorrow seek leave to appeal the High Court ruling that it "unlawfully submitted" to "blatant threats" from the Saudis.

Earlier this month the court ruled in favour of anti-bribery campaigners who claimed the SFO should have continued its probe into alleged illegal payments to members of the Saudi royal family.

The Government argued the inquiry put anti-terrorism co-operation with the Saudis under threat.