The US has turned down an extradition request for the woman charged over the death of 19-year-old Harry Dunn.
A US State Department spokesperson confirmed that the UK’s extradition request for Anne Sacoolas, the wife of an American diplomat, had been denied.
“At the time the accident occurred, and for the duration of her stay in the UK, the US citizen driver in this case had immunity from criminal jurisdiction,” they said.
“If the United States were to grant the UK’s extradition request, it would render the invocation of diplomatic immunity a practical nullity and would set an extraordinarily troubling precedent.
“The United States has a history of close law enforcement cooperation with the United Kingdom, and we value that relationship.
“The United States government again expresses its sincere condolences and sympathy to the Dunn family for the loss of their son.”
Mr Dunn died in a head-on crash with a car on 27 August last year near to RAF Croughton in Northamptonshire.
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The driver of the car, Mrs Sacoolas, claimed diplomatic immunity and returned to the US, where she has been since Harry died.
Mrs Sacoolas, 42, was charged with causing his death by dangerous driving, by the Crown Prosecution Service in December.
The Home Office said it was “disappointed” by the US Secretary of State Mike Pompeo’s rejection of the extradition request.
In a statement a Home Office spokeswoman said the decision “appears to be a denial of justice”, adding: “We are urgently considering our options.”
Mr Dunn’s family have said they are “not surprised” and had “expected this all along”, according to Sky News correspondent Lisa Dowd.
They said they would react fully to the announcement later on Friday, but insisted “the fight goes on” for justice for their son.
Lawyers acting on behalf of the Dunn family have said it is the first time in the 100-year history of the extradition treaty that such a request had been turned down by the US.
However, Boris Johnson has previously described the chances of America handing over Mrs Sacoolas as “very low”.
Spokesman for the Dunns, Radd Seiger, said the family’s constituency MP Andrea Leadsom had called him on Thursday evening to inform him of Mr Pompeo’s decision.
He told Sky News: “She told me an email had dropped in to the government this evening from Secretary Pompeo declining the extradition request.
“It was not a surprise and there was no reason given.”
Mr Seiger continued: “This changes absolutely nothing, we completely factored in this development into our planning – we knew it was coming all along. Secretary Pompeo made his position clear right from the start that she was never going back.”
Ms Leadsom is due to meet the US ambassador Woody Johnson in London on Friday to discuss the case.
The decision comes after the commander of a US military base, Colonel Bridget McNamara of RAF Croughton in Northamptonshire, said all staff must take a “driver safety course” and pass a written exam based on UK driving laws.
At the weekend, police revealed that diplomatic cars were driven on the wrong side of the road in two separate incidents near the base.
Footage has emerged of one of the incidents, showing a blue BMW involved in a near-miss.
The base, which is used as a communications station for the US Air Force, has come under scrutiny since Mr Dunn’s death.
In reaction to the statement from Col McNamara, Mr Dunn’s family said it was the first time they had heard from the colonel for five months.
Mr Seiger said the base had a “blatant disregard for the safety of the community” and said their statement was “the opposite of the truth”.