A Bahrain prosecutor has ordered retrials in civilian courts for 20 medics sentenced under martial law for crimes they were accused of committing while treating victims from anti-government protests earlier this year.

The announcement followed condemnation from the US and European states as well as global medical bodies and rights groups at the sentences of 5-15 years handed down by a security court last week.

The plight of the medics – two paramedics and 18 doctors from Bahrain's biggest hospital, the Salmaniya Medical Centre (SMC) – had proven to be hugely damaging for Bahrain's rulers, who had launched a relentless crackdown on leaders of a civic rights push it insisted was a sectarian plot backed by Iran.

The foreign secretary, William Hague, said Britain had "serious concerns" about the transparency of the medics' trials, and the forum in which they were held – a star chamber established under martial law.

The Gulf kingdom's attorney general, Ali Bouainain, announced the climbdown on Wednesday.

"The retrial will be conducted before the highest civil court in Bahrain," he said. "The Department of Public Prosecution seeks to establish the truth and to enforce the law, while protecting the rights of the accused. By virtue of the retrials, the accused will have the benefit of full re-evaluation of evidence and full opportunity to present their defences."

Bouainain said the doctors would remain free on bail pending the outcome of the new trials: "No doctors or other medical personnel may be punished by reason of the fulfilment of their humanitarian duties or their political views."

Four of the doctors have this week vehemently denied playing any role in inciting sectarian tensions, where the country's Shia Muslim population majority is ruled by a Sunni Muslim minority.

The doctors allege they have been persecuted for treating victims and for advocating some political views in front of the world's media, which descended on the SMC as hundreds of protesters wounded in clashes with security forces were treated during late February.

By that time, the hospital had become a protest hub for the almost exclusively Shia rights activists who had been ousted from the central Manama roundabout they had been using as a forum to champion their demands for greater access to the establishment.

The six months since has seen failed calls for a national dialogue, a parliamentary boycott by the largest opposition bloc and a purge of protesters from jobs in Bahrain's public and private sectors.

Meanwhile, Bahrain's crown prince, Salman bin Hamad al-Khalifa, who is regarded by the US and Britain as a liberal in the regime's inner sanctum, today called for the business community to help generate unity in Bahrain, which has seen a sharp drop-off in foreign investment and some international companies scaling back operations since the crisis began.

"We are losers if we slip into the cauldron of division, sedition and discrimination," he said in a televised address.

A military court on Wednesday sentenced 19 people, including a 16-year-old Iraqi football player, to up to five years in prison for their part in the protests. The sentences, which can be appealed against, bring the total number of people jailed this week to 81.