BERLIN (CNN) -- In a ruling expected to strain Germany's diplomatic relations with Iran, a German court Thursday convicted four men in the 1992 murders of dissident Iranian-Kurdish leaders in a Berlin restaurant and found that the killings were ordered by the "highest state levels" in Iran's capital. CNN's Jackie Shymanski reports: The judges convicted two men of murder and two others of being accessories to murder in the September 17, 1992, deaths of Iranian-Kurdish leader Sadiq Sarafkindi and three of his colleagues. Presiding Judge Frithjof Kubsch said the men had no personal motive but were following orders. Without naming names, Kubsch said the gangland-style murders had been ordered by Iran's Committee for Special Operations, to which Iran's president and spiritual leader belonged. Prosecutors had contended that Iran's powerful spiritual leader, Ayatollah Ali Khamenei, and Iranian President Hashemi Rafsanjani had personally ordered the killings. Germany said it was expelling four Iranian diplomatic staff. "The participation of Iranian state agencies, as found in the court verdict, represents a flagrant violation of international law," the German foreign ministry said in a statement. Iranian speaker calls verdict 'political' The verdict is sure to anger Iran's leadership, which has in the past denied any responsibility for the assassination. Speaker of the Iranian parliament Ali Akbar Nateq-Nouri Thursday dismissed the verdict as "political." He said the accusations were untrue and demanded evidence. "We have asked the German leadership many times if there is any evidence and if so to present it to us," Nouri said. "But until now they haven't. The trial had a political tinge." The ruling is expected to sour relations between the two countries. Germany is Iran's biggest Western trading partner, with between $1 billion and $2 billion worth of investments in Iran; about 500 German citizens live in Iran. Until now, trade has encouraged the German government to hold what it calls a "critical dialogue" with Iran, raising issues of terrorism and human rights while continuing to do business. Germany has maintained this policy despite criticism from the United States, which has pursued an isolationist policy with Iran. The judges found Kazem Darabi, an Iranian who worked as a grocer in Berlin, and a Lebanese man, Abbas Rhayel, guilty of murder and sentenced them to life in prison. Two other Lebanese, Youssef Amin and Mohamed Atris, were convicted of being accessories to murder. Amin was given 11 years and Atris five years and three months. The fifth defendant, Atallah Ayad, also Lebanese, was acquitted. Iran, Germany recall ambassadors Both Germany and Iran announced they were recalling their respective ambassadors following the verdict. The Iranian foreign ministry said it had recalled its ambassador to Germany for "certain consultations," Iranian state television said. German officials were braced for post-trial consequences ranging from a diplomatic row to a terrorist attacks against German targets at home and abroad.In preparation for possible retributions, security around the Berlin courtroom was tightened. The German government has also warned its citizens against traveling to Iran unless absolutely necessary, and it advised all German citizens in Iran to stay in close contact with the German embassy in Tehran. Meanwhile, hundreds of Iranian dissidents, who arrived early Thursday morning for the trial's outcome, danced euphorically when the verdict was read. Carrying huge banners, they celebrated, cheered, and played music in the streets. Pro and con on 'critical dialogue' policy Leaders of the Iranian opposition said they still wanted a better guarantee that Germany would review its critical dialogue policy and drop it, following the lead of the United States and other Western governments in cutting off contact with a regime that sponsors state terrorism. "There is now absolutely no justification for the continuation of the 'critical dialogue' policy and for the appeasement of this regime," said Massoud Radjavi, chairman of the National Council of Resistance of Iran. But one prominent Bonn politician, Free Democrat deputy Juergen Moellemann, said Germany should now intensify its controversial "critical dialogue" with Tehran rather than give it up.=20 "A Berlin judge cannot decide how we organize our relations with countries around the world," he said. "If there are problems, one should actually intensify the dialogue." Germany had already issued an arrest warrant for Iran's minister of intelligence in connection with the crime. Correspondent Jackie Shymanski contributed to this report. German court ruling puts Iran ties to test April 10, 1997 In this story: Iran denies responsibility for killings. Strongly worded protests expected. DUBAI, United Arab Emirates (Reuter) - A German court ruling on Thursday accusing "Iran's political leadership" of ordering the 1992 murders of dissident Iranian Kurdish leaders in Berlin puts Iran's ties with its best European friend to the test. There was no immediate reaction from Iran to the ruling. Residents in the Iranian capital said the German embassy was closed although it is usually open on Thursdays, but they did not see any extra security measures at the embassy building in central Tehran. The Berlin court avoided citing names but gave the positions of the Iranian officials it believed were behind the murders as members of a committee for special operations who it said were the state president, Iran's religious leader, the intelligence minister and other security officials. Iran's state news agency IRNA reported the verdicts against the defendants, including a life sentence against an Iranian, but did not mention that part of the ruling accusing the Iranian leadership. Iran's ties with Bonn were strained by German charges that spiritual leader Ayatollah Ali Khamenei and President Akbar Hashemi Rafsanjani ordered the murders of Kurdish opposition leader Sadegh Sharafkandi, two associates and a translator. Iran denies responsibility for killings Bonn has issued an arrest warrant for Intelligence Minister Ali Fallahiyan, whom they accuse of masterminding the murders. Iran denies all responsibility for the killings, which it blamed on infighting among opposition groups. It has condemned the trial as politically motivated, citing the fact that a main witness was Abolhassan Banisadr -- Iran's first president who fled to France after being deposed in 1981 and is accused by Tehran of hijacking and other crimes. Foreign Minister Ali Akbar Velayati said on Wednesday a "negative" verdict could damage ties with Bonn and denied reports that the 500 German nationals living in Iran were at risk. "These are nothing but baseless allegations. ... We support human values and German nationals will have full security," he said. "But a negative verdict by the ... trial will have a negative impact on political and economic ties between Tehran and Bonn." "We will react to the verdict based on ... Islamic dignity, the interests of the Muslim nation and wisdom," he said. He was reacting to reports that pro-Iranian groups might attack German interests or that the lives of German nationals in Iran were under threat if the court backed charges by German prosecutors that Tehran ordered the killings. Velayati said Iran had good relations with Germany and drew a distinction between the court and the Bonn government. Strongly worded protests expected Germany is Iran's main trading partner. It has resisted pressure, mainly from the United States and Britain, to shun Iran, which they accuse of state terrorism, a charge Iran denies. Bonn has been the driving force behind the European Union's policy of "critical dialogue" with Tehran. Iranian analysts said they believed Iran would issue strongly worded protests against the court's ruling but doubted it would go as far as jeopardizing its vital ties with Germany. They referred to comments by Khamenei late last year as the row broke that the United States and Israel were Iran's main enemies and disputes with other countries were secondary. They said the comments looked like an attempt to defuse the row. The court gave life sentences to Kazem Darabi, an Iranian, and Abbas Rhayel, a Lebanese. Two other Lebanese got prison sentences of between five and 11 years as accomplices It found a fifth man innocent of the complicity charges. The German Foreign Ministry has warned Germans not to travel to Iran unless absolutely necessary and to remain in constant contact with the embassy in Tehran. In November, protesters marched on the embassy, pelted it with eggs and stones and called for the death of German state prosecutor Bruno Jost