The High Court is set to rule on who the UK Government recognises as president of Venezuela as part of a battle over one billion US dollars (£800 million) of gold bullion held in the vaults of the Bank of England.

Banco Central de Venezuela (BCV) has taken legal action to release the gold held on its behalf, which it wants to sell to help tackle the country’s coronavirus crisis.

BCV says it has agreed to transfer the funds to the United Nations Development Programme (UNDP) to buy “healthcare equipment, medicines and basic foodstuffs” to address the Covid-19 emergency in Venezuela.

But the Bank of England (BoE) says it is “caught in the middle” of rival claims to the gold: from the BCV board appointed by Mr Maduro and an “ad hoc” board appointed by opposition leader Juan Guaido, who personally asked former BoE governor Mark Carney not to “act on instructions from the Maduro board”.

On Thursday, the High Court will rule on who the UK Government formally recognises as the president of Venezuela, and who therefore has the authority to give instructions in relation to the gold, following a four-day preliminary hearing in June.

At the hearing last month, Nicholas Vineall QC – representing the “Maduro board” of the BCV – said the UK “unequivocally recognises” the government of Mr Maduro despite considering his position to be “illegitimate”.

He added that recognising Mr Guaido as head of state would be “an impermissible intervention in the affairs of Venezuela” and also “unlawful under international law”.

Mr Vineall said the UK Government “does not approve of the Maduro government” but that it “continues to recognise the Maduro government”, sending an ambassador to Venezuela and receiving Mr Maduro’s representative.

Mr Maduro, who became president of Venezuela following the death of Hugo Chavez in 2013, was sworn in for a second term last year amid claims of vote-rigging in the 2018 election, which was boycotted by opposition parties.

Mr Guaido declared himself acting president in January 2019 and, a month later, then foreign secretary Jeremy Hunt said the UK recognised Mr Guaido as “the constitutional interim president of Venezuela until credible presidential elections can be held”.

His lawyers say he must therefore be regarded by the High Court “as the president of Venezuela”.

However, Mr Vineall told the High Court that the response of the UK Government in linked proceedings, involving about £100 million which Deutsche Bank owes to the BCV, “makes crystal clear that the Government does not recognise a Guaido government and continues to recognise the Maduro government”.

In that case, the High Court sent “a written request addressed personally” to Foreign Secretary Dominic Raab, asking for “a written certificate stating who the Government recognised as head of state and/or head of government”.

But, Mr Vineall said, Mr Raab “did not provide a certificate and did not even respond to the letter himself” – the court instead received a letter from a senior civil servant which “simply referred back to the February 2019 statement”.

Andrew Fulton, representing the “Guaido board” of the BCV, said the UK Government “has decided to recognise Juan Guaido as the constitutional interim president of Venezuela and has denounced the ‘illegitimate, kleptocratic Maduro regime’”.

Mr Fulton added: “In the courts of other countries whose governments have chosen to take a different stance to the UK on the legitimacy of Mr Maduro, the members of the Maduro board may enjoy a more sympathetic reception to their assertions that they are entitled to speak for the BCV.

“In England, however, those claims are doomed.”

Mr Justice Teare is due to give his judgment at 10am on Thursday.