Spain's Supreme Court on Monday upheld embezzlement charges against Catalan secessionist leader Carles Puigdemont, effectively overruling an amnesty agreed by politicians in the country .

Puigdemont is accused of misappropriating public funds as part of Catalonia's 2017 independence referendum, which went ahead despite being declared illegal by the Supreme Court.

Spain's parliament passed an amnesty bill in May that was meant to pardon Catalan separatists while establishing two exceptions for embezzlement. The agreement was a crucial part of Prime Minister Pedro Sanchez forming a government with support from a pair of Catalan parties after an indecisive election.

What did the court say?

The court said in a statement that judge Pablo Llarena "issued an order declaring the amnesty is not applicable to the crime of misuse of public funds."

It said that it agreed to keep in place an arrest warrant against Puigdemont, as well as against former Catalan Health Minister Antonio Comin and Culture Deputy Lluis Puig.

Judge Llarena said that the conduct of Puigdemont, Comin and Puig "fully fits with the two exceptions contemplated in the law."

The judge argued that the three politicians obtained financial gain by funding the 2017 independence referendum with money from the regional treasury.

He said that the referendum would have affected the European Union's financial interests in damaging Spain's tax collection and gross national income.

Puigdemont now has three days to lodge an appeal.

The Catalan leader fled to Belgium following the 2017 independence bid and currently lives in southern France.

Arrest warrant could affect Sanchez coalition

Spanish Prime Minister Pedro Sanchez took office for a second term late last year after general elections resulted in a hung parliament.

In order to form government, he relied on the support of Puigdemont's Junts party and the separatist Republican Left of Catalonia (ERC).

After the Spanish parliament approved the amnesty law on May 30, judges were given two months to apply the law. They must do so by dismissing charges and cancelling arrest warrants against separatists.

However, the amnesty will be a lengthy process, as the courts must apply the amnesty on a case-by-case basis. 

Many judges have spoken out against the amnesty law. Spain's right-wing and far-right opposition has staged months of protests against it, some of which have turned violent. It has also caused deep divisions in Spanish society and even within Sanchez's own ruling Socialist Party.

sdi,dh/msh (AFP, Reuters)