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Oil major Royal Dutch Shell (RDS.A) cannot be sued in London over Nigerian oil spills, the High Court ruled Thursday, heading off any future attempts to request British multinationals to take responsibility at home for their subsidiaries' actions abroad.
The High Court adjudicated that the parent company has no legal responsibility for alleged pollution of fishing areas and farmland by its subsidiary in Nigeria.
“It was agreed by both parties that if my judgment was such that there was no arguable duty of care on the part of RDS to the claimants under English law, then there would not be any cause of action in common law under the law of Nigeria,” reads the conclusion of the judgment.
This case could be a precedent for others who might seek UK multinationals’ accountability for their actions abroad.
If the High Court had ruled in favor of the claimants, others could have been encouraged to pursue legal action against British-based multinationals through the British courts, legal experts have said.
Villagers from the Bille and Ogale communities in the oil-producing Niger Delta in southern Nigeria claim they have been negatively affected by pollution and chose to take action against Shell in London rather than its subsidiary in Nigeria.
King Okpabi, the leader of the Ogale community, said the communities would challenge the decision at the Court of Appeal.
“RDS makes billions of dollars of profit each year from Nigerian oil but our communities which host its infrastructure have been left environmentally devastated. Shell underestimate us if they think this judgement will affect our resolve. We still very much believe in the British justice system and so we are going to appeal this decision,” said Okpabi.
Leigh Day, the law firm representing the villagers, confirmed they would appeal the ruling.
"My clients are very confident they will succeed in an appeal," said Leigh Day partner Daniel Leader, who also represented Nigeria's Bodo community in another oil spill in 2008 and a 2009 claim against Shell that ended in a $55 million settlement in 2015.
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The High Court said the claimants should be able to use Nigerian courts, while the claimants maintain that Nigeria courts are not advanced enough to hear the case. Shell insists that the case is specifically Nigerian and must be heard in Nigeria.
Shell denies responsibility for the spills, which it says were due to sabotage and illegal refining.
Igo Weli, Shell Nigeria’s general manager for external relations, said the firm hoped "the strong message sent by the English court today ensures that any future claims by Nigerian communities concerning operations conducted in Nigeria will be heard in the proper local courts".
While the Niger Delta community suffered a loss in London, later on Thursday documents cited by Reuters revealed that a Nigerian court has ordered Shell and Italian Eni, among others, to temporarily turn over assets and operations related to a disputed oilfield. The asset forfeiture will remain in place until the conclusion of a corruption investigation into how the licenses for this field were obtained in 2011. The block in question is estimated to hold up to 9.23 billion barrels of oil. Neither Shell nor Eni have commented on the court order.
By Damir Kaletovic for Oilprice.com
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Damir Kaletovic is a veteran investigative journalist covering Europe and the Middle East, and a senior consultant for Divergente Research.