On January 30, 2013, the court (Rechtbank) in the Hague, The Netherlands, ruled that Royal Dutch Shell can be held partially responsible for pollution in Nigeria's Niger Delta region and ordered it to pay damages to one farmer. The Dutch court dismissed four out of five allegations of the Ogoni people against the oil company. Although Shell blames the oil pollution to sabotage, activists say the case could set a precedent for damage claims related to the foreign activities of multinational companies.
Ogoni is the name of a region in the Niger Delta of southern Nigeria as well as the name of the ethnic group that lives in that region. The region is an important wetland and coastal marine ecosystem and is home to some 31 million people many of whom rely on it for their livelihoods. For the Ogoni and the people of Nigeria, oil and oil companies have brought poverty, environmental devastation and widespread, severe human rights abuses.
John Vidal wrote in his Guardian blog (January, 29, 2013) that in his trip in January to the Delta, people were telling him that if anything, the pollution was getting worse. One of the victims told him: "Spills in the US are responded to in minutes; in the Niger delta, which suffers more pollution each year than the Gulf of Mexico, it can take companies weeks or more".
The case, which has the Dutch environmental justice organization Milieudefensie as co-Plaintiff, was filed in 2008 and had passed through lots of legal hurdles ostensibly set up by Shell before getting to this point of judgment. The plaintiffs, according to Friends of the Earth, Netherlands, opted to drag Shell before a Dutch court because they were said to have lacked confidence in Nigerian courts as hundreds of legal cases allegedly brought by victims of oil pollution have become “stranded in the inefficient and corrupt Nigerian legal system.”
While Royal Dutch Shell Plc, Shell's parents company with headquarters in the Hague, Netherlands, had maintained that it could not be held responsible for the actions of its subsidiary in Nigeria, the subsidiary Shell Petroleum Development Company Nigeria Ltd had insisted that it cannot be tried by the court in the Hague for problems arising from Nigeria. But the Dutch judiciary in 2009 declared itself competent to try the case, mainly because the parent company of Shell owns 100% of its shares of The Shell Petroleum Development Company of Nigeria Ltd.
Shell says the individual spills were caused by sabotage and under Nigerian law, oil companies are not liable to pay compensation for damage caused by sabotage spills. The court claimed that for two oil spills near the village Ikot Ada Udo that Shell Nigeria “has violated a duty of care and shall be held liable for tort of negligence”.
Andy Rowell pointed out in his blog for Oil Change International (January, 30, 2013) that "this is the first time a multinational has been held accountable for the actions of its subsidiaries in its home nation. This could open the flood gates for litigation against Shell or other multinationals in other countries. (...) Despite chronic pollution from Shell’s operations for decades, it was the first time a Dutch-registered company had been sued in the Netherlands for offences by a foreign subsidiary."
In the U.S. Shell has been sued for complicity in the killings or persecution of environmental activists in the Ogoni region. This lawsuit was based on the Alien Tort Statute, a law enacted in 1789 by the first U.S. Congress and aimed mainly at pirates. The statute says U.S. trial courts can hear civil damage suits brought by a foreign national for wrongs "committed in violation of the law of nations or a treaty of the United States." The trial ended in a settlement (see a previous blog by H. Thijssen).
Milieudefensie (Friends of the Earth Netherlands) and the plaintiffs are disappointed that not all the claims were successful, but they plan to appeal about the spill at Goi in Ogoniland, which the court ruled there was “insufficient evidence that it was not cleaned up”.
It is quite difficult to predict how frequently multinationals will have to defend their illegal activities in developing countries during civil suits in courts in their homecountries. Where they used to hide behind their international character, local farmers and indigenous peoples seem to gain, with the help of non-governmental organizations, more access to justice to courts in the mulitnationals' homecountry. It does not mean there is no pressing need to create international regulations implementing the corporate (social) responsibility of multinationals committing environmental crimes, human rights violations and other illegal activities abroad.