Dutch Court Can Rule On Oil Leaks Case Shell Nigeria

By Maarten van Tartwijk Of DOW JONES NEWSWIRES

AMSTERDAM -(Dow Jones)- A Dutch court Wednesday said it has jurisdiction to rule on alleged oil spills by Royal Dutch Shell PLC’s (RDSB) subsidiary in Nigeria, a ruling which could set a legal precedent for multinationals in the Netherlands.

The ruling is “an initial victory for all Nigerians that have been fighting for years for a cleaner habitat and justice”, Friends of the Earth Netherlands said in a statement.

Four Nigerians, in conjunction with Friends of the Earth Netherlands, want compensation from Shell, saying they have lost their livelihoods after oil from Shell’s leaking pipelines streamed over their fields and fishing ponds.

They want to sue both Shell in the Netherlands and the oil major’s Nigerian subsidiary, saying the mother company has direct control on the activities of its units abroad and that Nigeria’s legal system is inadequate to handle the case.

At a hearing in The Hague earlier this month, Shell disputed the court’s jurisdiction to rule on its Nigerian subsidiary and said that such a case should be handled by a Nigerian court. The oil giant also said it cannot be held accountable for the oil leaks as they were caused by sabotage.

However, the court said Wednesday that, in order to handle the case properly, both Shell and its Nigerian unit should be heard. It also said that “it is not unusual” in the Dutch jurisprudence to rule on events that happened outside the Netherlands.

The trial will continue in February next year.

“We are disappointed by the court ruling”, a Shell spokesman told Dow Jones Newswires. “There are good arguments on which the court could have concluded it lacks jurisdiction. This [case] is a pure Nigerian matter.”

The case was also a matter of principle for Friends of the Earth Netherlands, as it might set a legal precedent for Dutch multinationals. “In many countries, including Nigeria, the legal system is inadequate, and it is thus crucial that a company can also be brought to trial elsewhere”, the environmentalist group said recently.

-By Maarten van Tartwijk; Dow Jones Newswires; +31-20-5715-200; [email protected]

(END) Dow Jones Newswires

December 30, 2009 09:29 ET (14:29 GMT)

Copyright (c) 2009 Dow Jones & Company, Inc.

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