A legal challenge brought by the Campaign Against the Arms Trade (CAAT) claimed ministers allowed £2.8bn (€3.4bn, $3.8bn) worth of arms sales to be sold to Saudi Arabia since March 2015, despite a "growing body of evidence" to suggest Saudi-led air strikes in Yemen had caused widespread civilian deaths.

This included, CAAT said, attacks on schools and hospitals. A hearing at the High Court on Thursday (30 June) granted a three-day judicial review into whether arms export licences – granted by Department for Business, Innovation & Skills (BIS) – had broken UK and EU laws.

Andrew Smith, of CAAT, said: "This is a historic decision and we welcome the fact that arms exports to Saudi Arabia will be given the full scrutiny of a legal review, but they should never have been allowed in the first place.

"The fact that UK aircraft and bombs are being used against Yemen is a terrible sign of how broken the arms export control system is. For too long, [the] government has focused on maximising and promoting arms sales, rather than on the human rights of those they are used against."

The judicial review, which would compel the government to give evidence over how it processed arms sales to its ally Saudi Arabia, will be held before 1 February next year.

The announcement comes more than a year after an international coalition led by Saudi Arabia – including the United Arab Emirates, Egypt, Bahrain, Kuwait, Qatar, Morocco, Jordan and Sudan – first launched air strikes to put down a Houthi-led rebellion in Yemen. The conflict has since been blamed for causing thousands of civilian casualties.

Saudi Arabia has become the UK's biggest customer of arms sales. Under current rules, export licences cannot be granted if there is a "clear risk" it would be used to break international humanitarian law.

The UK government has always insisted sales to Saudi Arabia are legal, with Foreign Secretary Philip Hammond saying the UK operated "one of the strictest export licensing regimes in the world".

Rosa Curling, from the human rights team at Leigh Day, which is representing CAAT, said: "Our clients are delighted the court has recognised this important claim must now progress to a full substantive hearing.

"The decision taken by the Secretary of State to continue to grant new licences for the sale of arms to the Kingdom of Saudi Arabia, is unlawful. There is overwhelming evidence that the Saudi led coalition has committed serious breaches of international humanitarian law in Yemen.

"The UK government must ensure it is not allowing weapons from this country to be provided where there is such a clear risk they will be involved in the tragic and horrific events taking place in Yemen."

A spokesman for BIS said it would not comment on the granting of a judicial review "due to the ongoing legal procedures".