The UK has appointed an ambassador to Iran for the first time since 2011, restoring diplomatic relations.
The decision comes nearly five years after Iranians invaded the British Embassy and one year after the British Embassy reopened in Tehran, which reflects gradual thawing of relations in the wake of the Iranian nuclear agreement.
Nicholas Hopton, a Middle East specialist, was appointed UK charge d' affairs in Tehran in December, and his role was upgraded to ambassador, reports the Guardian.
Boris Johnson, the Foreign Secretary on Monday said, "This is an important moment in the relationship between UK and Iran."
"The upgrade in diplomatic relations gives us the opportunity to develop our discussions on a range of issues, including our consular cases about which I am deeply concerned, and which I have raised with foreign minister [Javad] Zarif," he added.
Meanwhile, a key figure in the Iranian nuclear negotiating team, Hamid Baeidinejad, has been appointed the Iranian ambassador to the UK.
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Reports suggest that the move came as British Airways restored direct flights to Tehran six days a week and British banks continued to increase operations.
Iran downgraded its relations with the UK in November 2011 when stronger international sanctions were imposed.
A group of students had also attacked the UK embassy compound in Tehran, damaging property and driving the embassy staff away.